Privatization Has Been a Colossal Flop
Let’s get this straight. I am a penny pincher, who hates waste and wants a lean and efficient government.
But, that said, we have to face the fact that our massive privatization of what once were government functions has been a failure. There are some public services that get really loused up when done privately and for profit.
This is a classic mismatch of wonderful theory and disastrous practice. The privatization theory is compelling. Government is inherently bloated, lazy, wasteful, dumb and inefficient because it does not have to face the discipline of the marketplace. Put public services up for private bidding and you will get the lower costs and greater efficiency that comes with free market competition.
But privatization practice is often a disaster. An inefficient government monopoly is replaced by an even more inefficient private monopoly that is more expensive, wasteful and lacking in accountability or responsibility for serving the public good.
The selection of private contractors is often rife with the corruption of political sweetheart deals. The profit motive consistently trumps public interest And shareholders and executives benefit at public expense, while public services deteriorate.
Let’s do a quick review of the scorecard.
Mental Health: De-institionalization and the privatization of community mental health centers allowed the states to off-load responsibility for the severely mentally ill so that now about 300,000 are in prison and a like number are homeless.
Medical Health: Our chaotic, profit-driven system delivers poor health outcomes even though it costs about twice as much per person as the more government regulated systems in the rest of the developed world. People who don’t need it get too much medical care because it is profitable to providers, while one in seven people lack any coverage at all.
Defense: We pay outrageously padded bills to private military contractors who deliver poor services with —> Read More