Costs of Privatization?

[GGT]

Sort of the inverse of "Costs of Government".

There are all sorts of problems and prices associated with privatizing things that benefit the public at large. Toll roads so expensive that only certain people (or corporations) can afford to use them. Education costs that exclude large swaths of a population. Medical care that's only afforded to/by upper income groups. The expensive R & D that wouldn't be done, etc.

I've never really seen the Small Government, Low Tax, Free Market, Libertarian proponents discuss the "costs" of privatization, or what that kind of society would look like.

*I've never seen the PRO-PRIVATE people make their case in affirmative ways. It's usually been framed as anti-public, anti-tax, anti-government. But being against something doesn't explain much.*

[Loki]

I can't afford my own private jet. Capitalism is evil!

[GGT]

I can't afford my own private jet. Capitalism is evil!

You're mixing metaphors, and being hyperbolic.

Could you have "afforded" your K-12, college, and post-graduate education....if it was entirely privatized?

[Loki]

If my parents weren't paying the taxes that they presumably wouldn't need to pay if those things weren't paid for by the government? And if the government didn't restrict the amount of private schools, which artificially inflates prices? Probably.

[Aimless]

I'm surprised by how often the old Communist argument of "it's never been tried in its entirety the way it's meant to" comes up in discussions of privatised vs. socialised healthcare. However, many individual aspects have been studied and privatization does in itself seem to often come with increased costs due to bad and uncoordinated healthcare. That's not to say that the alternative is problem-free, it's just a recognition of the difficulties of keeping costs down in healthcare using half-assed free-market ideas. I have no idea about schools, I imagine you guys could fund them all by taxing churches

[GGT]

If my parents weren't paying the taxes that they presumably wouldn't need to pay if those things weren't paid for by the government? And if the government didn't restrict the amount of private schools, which artificially inflates prices? Probably.

Do you think your parents paid NY taxes that exceeded the cost of a totally private education? I find that hard to believe, since private K-12 tuition is at least $20,000/year. If teh NY state government restricts the amount of private schools, you could easily have attended across the river in NJ, or skipped over to CT.

You ended up at an Illinois university, but not paying high out-of-state tuition rates. Instead, you used gov't grants and loans, or the university itself was able to offer you stipends or paid TA positions....because of public tax dollars.

[Loki]

Private tuition is that high only because of massive barriers to entry (including an outright ban on new schools most of the time). It could easily fall to half that for most decent schools.

Actually, I am "paying" out of state tuition in Illinois, but seeing that I have a job, the department pays the tuition. I get no funding from the government of Illinois. The university also gets a minimal percentage of its money from the government of Illinois, which also has a tendency to not pay large parts of its bill.

[GGT]

Be careful in thinking the whole world operates like New York, or NYC. Most states and urban hubs don't have "outright bans" on new schools.

That said, private schools (especially those not associated with wealthy churches) are expensive because they have costs associated with property, facility management, and higher teacher salaries (to offset union benefits like healthcare and pensions). They're also more likely to offer "expensive" amenities of boarding, summer school, semesters abroad, dining rooms vs cafeterias, etc. They don't cut art or sports programs, or close the library when budgets get tight...they simply raise tuition and/or enroll more students.


You might say your education could be reproduced without any public funding behind it, but I'd say that's nonsense. And just so this doesn't turn into a strictly education thread.....

How many flights abroad could you have afforded, without the benefit of public tax-subsidized airports? And could you have gotten to those airports without using public roads or bridges, trains or buses?

[Loki]

You're blatantly ignoring the fact that the reason those schools have high expenses is before they target the children of the rich. The schools that don't do that (and there would be far more of them without the current restrictions) would have all the incentive to keep expenses down.

Have you seen what percentage of a plane ticket goes to tax? You really need to move to some socialist utopia where your ideas are put into full practice. I hear Venezuela is available.

[GGT]

Sorry if stepping out of your orthodox world view makes you uncomfortable and hissy.....but you're not really addressing the core of the topic, Loki.

Instead of demonizing the Costs of Government (ie, taxation, regulations, limitations) or insinuating that any government intervention is a cloaked version of sssocialist utopian ideology --- I was hoping for affirmatives for privatization. Explain why privatization of public goods and services might be better than what we have now.

As I said, I've never really seen that type of pro-privatization argument, with any specifics.

[Aimless]

Instead of demonizing the Costs of Government (ie, taxation, regulations, limitations) or insinuating that any government intervention is a cloaked version of sssocialist utopian ideology --- I was hoping for affirmatives for privatization. Explain why privatization of public goods and services might be better than what we have now.

As I said, I've never really seen that type of pro-privatization argument, with any specifics.

If that's what you wanted and were hoping for you might want to edit that info into the OP for the benefit of coming readers

[Loki]

Let's flip the question around. If privatization is bad, then surely nationalization is good. Are you in support of nationalizing the financial sector, GGT? How about the transportation sector? Manufacturing?

[GGT]

If that's what you wanted and were hoping for you might want to edit that info into the OP for the benefit of coming readers

Okay, edit made.

Let's flip the question around. If privatization is bad, then surely nationalization is good. Are you in support of nationalizing the financial sector, GGT? How about the transportation sector? Manufacturing?

I never said privatization is "bad". Just that it comes with certain costs.

[Loki]

But those costs are apparently not worth the benefit. So why not nationalize more industries? Then we'd forego those extortionate costs!

[GGT]

Those "costs" of privatization refer to a nation with an unhealthy, uneducated (or under-educated) demographic. And growing. An economically and geographically immobile part of the populace. And growing. A tiered culture where "opportunity" only applies to a distinct group...who can pay for private education, private healthcare, or get private loans.

[Loki]

Again, if the costs are so high, why not nationalize more industries?

[GGT]

Again, if the costs are so high, why not nationalize more industries?

If privatization is so great, why not dismantle local/sate/federal police forces, and just hire private contractors? Why not hand immigration and border security over to private militia or private security firms? How about we replace our military forces with private contractors?

[Loki]

Thank you for your usual non-answer.

[RandBlade]

Not entirely privatised per se but this government just over a year ago changed the law so that virtually any group or individual could found a semi-independent not-for-profit school that would be ran by them but paid by the state on the same costs as state-schools are. Call it a voucher system if you will.

Since the law was changed to permit that there have been LOTS of requests to open new schools. I believe over a dozen are opening this year and many, many more are in the pipeline for the next few years.

The state doesn't need to run everything even if it pays for it, you can mix the two and have a competitive but state-financed environment. Just normally the state doesn't permit it. Especially in big cities (which generally get the worst results in state facilities) I'd be quite content to see all state schools become semi-"privatised" and independent of state control with a voucher system for payments. Let parents choose were to send their children and let the schools compete for money that way. The better a school's reputation becomes, the more parents will want to send their kids there and standards overall will improve - competition in action.

[Veldan Rath]

If privatization is so great, why not dismantle local/sate/federal police forces, and just hire private contractors? Why not hand immigration and border security over to private militia or private security firms? How about we replace our military forces with private contractors?

Because that IS what the government is for. Why do you keep ignoring this?

[Flixy]

To some extent that is being done anyway, private security firms are often hired to assist the military (Blackwater etc.) or take over tasks that the police can't/won't do anymore (for example, police used to do security at rock shows).

[Aimless]

Since the law was changed to permit that there have been LOTS of requests to open new schools. I believe over a dozen are opening this year and many, many more are in the pipeline for the next few years.

Okay and the significance of that is? Apart from "people want money" I mean.

[Veldan Rath]

Okay and the significance of that is? Apart from "people want money" I mean.

That more private schools can become available, thus competition, thus schools aiming for any students not just the 'rich' ones, thus being more affordable.

[Aimless]

That more private schools can become available, thus competition, thus schools aiming for any students not just the 'rich' ones, thus being more affordable.

Yeah but what's the goal of all that competition??

[Loki]

To improve the quality of the schools. The ones currently serving poor children are terrible.

[ar81]

Privatizing profit and socializing losses bring certain doom to a nation. If you bring something that bring losses and no public benefit, that's fine, but if it brings public benefit or revenue to government, it is wrong to privatize, specially if government has defeicit and debt. If you see privatization processes, you will see that this wrong privatization takes place.

Here some examples of privatization:
FRANCE: http://www.cbc.ca/fifth/deadinthewater/france.html
NORTH AMERICA: http://www.cbc.ca/fifth/deadinthewater/america.html
ARGENTINA: http://www.cbc.ca/fifth/deadinthewater/argentina.html
CALIFORNIA: http://www.cbc.ca/fifth/deadinthewater/california.html
SOUTH AFRICA: http://www.cbc.ca/fifth/deadinthewater/africa.html

If privatization is so great, why not dismantle local/sate/federal police forces, and just hire private contractors? Why not hand immigration and border security over to private militia or private security firms? How about we replace our military forces with private contractors?

If you hire a guy using public money, you only pay a salary. If you hire a company with public money to have this guy, you are paying his salary, plus some company profit.

[Veldan Rath]

Yeah but what's the goal of all that competition??

?

Yes, the end result for the investors of the schools will most likely be $$$, but most likely not at the OMG WE RICH level of return. Capital investments like this are LONG GAME (years) to cover costs and show a profit (however minor or even a minor loss) for the first few years then as the big bills are paid off, the return is better (until the next 'upgrade' to the facilities) then repeat.

I think you are gonna see that the backers of these requests are people actually desiring to educate kids (cause it's a win win for them).

[Aimless]

To improve the quality of the schools. The ones currently serving poor children are terrible.

I'm just trying to figure out how that will play out with the expected rapid proliferation of [ostensibly] non-profit private schools. I mean, if you're not competing for profit and if you're not competing for reimbursement for meeting "standards", then what would you compete for? Getting what's left of the bad students and teachers? What are the realistic expected outcomes?

I'm a great believer in the motivational power of doing social good--eg. by better serving educationally shafted kids--and getting more control over your work situation--eg. by starting your own school--but I dunno. The Swedish experiences with privatizing the educational and healthcare sectors have been mixed, to put it mildly. Still, turning a few churches into schools for the poor would be a nice thing to do I suppose, private or otherwise.

[Aimless]

?

Yes, the end result for the investors of the schools will most likely be $$$, but most likely not at the OMG WE RICH level of return. Capital investments like this are LONG GAME (years) to cover costs and show a profit (however minor or even a minor loss) for the first few years then as the big bills are paid off, the return is better (until the next 'upgrade' to the facilities) then repeat.

I think you are gonna see that the backers of these requests are people actually desiring to educate kids (cause it's a win win for them).

I want to believe. In Sweden, education--and, to a far greater extent, healthcare (esp. the care of the elderly and disabled)--has led to a veritable gold rush for venture capitalists and others keen on making quick money. I'm beginning to think that the people for whom caring for others is a calling are not the people who come to the forefront when it comes setting up a business or similar organisations.

[Loki]

I'm just trying to figure out how that will play out with the expected rapid proliferation of [ostensibly] non-profit private schools. I mean, if you're not competing for profit and if you're not competing for reimbursement for meeting "standards", then what would you compete for? Getting what's left of the bad students and teachers? What are the realistic expected outcomes?

I'm a great believer in the motivational power of doing social good--eg. by better serving educationally shafted kids--and getting more control over your work situation--eg. by starting your own school--but I dunno. The Swedish experiences with privatizing the educational and healthcare sectors have been mixed, to put it mildly. Still, turning a few churches into schools for the poor would be a nice thing to do I suppose, private or otherwise.

The company tries to make profit. But since all of them are trying to make a profit, they have to find a way to attract buyers. That means either lower cost, a better product, or some combination of the two.

And yet your do-gooder approach is producing terrible results in said areas. Meanwhile, there have been several cases of privately run school in the same areas getting astounding results. Looks like people actually respond to incentives. Who knew.