Costs of Privatization?

[Aimless]

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.

RB mentioned not-for-profit schools popping up in the UK. Here we haven't seen so much in the way of lower costs (for taxpayers) or better results, rather the opposite. Hence my skepticism.

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.

You must not be paying attention. I was specifically referring to Sweden's disappointing experiences with trying to get "astounding results" by privatizing the school and some areas of the healthcare system. Dread keeps mentioning Sweden as a positive example when it comes to schools so I just assumed everyone knew that Sweden has been trying this for years now and that it hasn't been as amazing as everyone hoped after accounting for selection bias etc. You make it sound like incentives are magic when we all know that successfully incentivising various aspects of learning and teaching isn't easy or simple. Or has there been some sort of sea change in this area of research in the past year?

[Loki]

RB mentioned not-for-profit schools popping up in the UK. Here we haven't seen so much in the way of lower costs (for taxpayers) or better results, rather the opposite. Hence my skepticism.

A) According to whom? Some do far better, others do worse.
B) This is not the model I was referring to. The parents don't actually pay for the school. What incentive do they have to shop around?

You must not be paying attention. I was specifically referring to Sweden's disappointing experiences with trying to get "astounding results" by privatizing the school and some areas of the healthcare system. Dread keeps mentioning Sweden as a positive example when it comes to schools so I just assumed everyone knew that Sweden has been trying this for years now and that it hasn't been as amazing as everyone hoped after accounting for selection bias etc. You make it sound like incentives are magic when we all know that successfully incentivising various aspects of learning and teaching isn't easy or simple. Or has there been some sort of sea change in this area of research in the past year?

Having some imperfect incentives is preferable to a system with lifetime tenure, salaries based on length of tenure, and zero accountability. The problem with many private schools is that they're run by people who have no idea how the education field works. The ones who do understand it tend to do a pretty good job.

[Lebanese Dragon]

A) According to whom? Some do far better, others do worse.
B) This is not the model I was referring to. The parents don't actually pay for the school. What incentive do they have to shop around?



Having some imperfect incentives is preferable to a system with lifetime tenure, salaries based on length of tenure, and zero accountability. The problem with many private schools is that they're run by people who have no idea how the education field works. The ones who do understand it tend to do a pretty good job.

For their kid's sake, it's not unheard of parents switching districts for the better schools their. Or attempting to enroll their kids in other schools (sometimes outside their districts even).

[Loki]

We wouldn't be in the mess we're in now if most parents made that choice. Furthermore, many public school districts make it very difficult and frequently illegal to enrol your child in a school outside of their immediate neighborhood.

[Lebanese Dragon]

I don't want to exclude our youth from education due to financial barriers. That is unacceptable to me, and furthermore I would contend that it is bad for our society, there are large positive externalities from an educated populace. I do agree our current set up is flawed, and we need a system that rewards based on performance of both teachers and principals.

[RandBlade]

RB mentioned not-for-profit schools popping up in the UK. Here we haven't seen so much in the way of lower costs (for taxpayers) or better results, rather the opposite. Hence my skepticism.

Source? Because our scheme is specifically following in the footsteps of the "tremendous success" of this scheme in Sweden.

We wouldn't be in the mess we're in now if most parents made that choice. Furthermore, many public school districts make it very difficult and frequently illegal to enrol your child in a school outside of their immediate neighborhood.

Same here in the UK. In order to be "fair" you have to be in your local schools "catchment area" as that way the state pays for everyone and there's no advantages. 94% of British students go to state schools.

However its not fair. Rather than paying for school fees, good parents merely end up paying ... to buy a new home in a good schools area. Of course

[Dreadnaught]

You must not be paying attention. I was specifically referring to Sweden's disappointing experiences with trying to get "astounding results" by privatizing the school and some areas of the healthcare system. Dread keeps mentioning Sweden as a positive example when it comes to schools so I just assumed everyone knew that Sweden has been trying this for years now and that it hasn't been as amazing as everyone hoped after accounting for selection bias etc. You make it sound like incentives are magic when we all know that successfully incentivising various aspects of learning and teaching isn't easy or simple. Or has there been some sort of sea change in this area of research in the past year?

I've been looking for some summary of what exactly you think is going wrong, I'm really curious.

[Aimless]

Source? Because our scheme is specifically following in the footsteps of the "tremendous success" of this scheme in Sweden.

Which is funny because the only thorough investigation with remotely current information was published late last year and that report concluded that there is too little evidence to support any strong conclusions about the success--or total failure--of the school reform, while also pointing out some of the problems that have cropped up. The govt. has recently instated a commission tasked with investigating these matters; we have news reports to work with in the meantime. For the sake of simplicity I'll refer to all schools not run by state/municipal/county as "private", although there's really a wide range of owners.

http://www.dn.se/nyheter/politik/bjo...r-om-friskolor

Minister of education criticises private schools for failing to provide school libraries, school nurses and counselors. (law was or is being changed to fix this problem)

http://www.dn.se/sthlm/fa-elever-ger-kris-pa-friskolor

Not even half of the 120 privately run highschools have managed to fill even half of their spots. This is partly because Swedes stopped having babies but also partly because of handing out too many licenses to run schools. A school with too few students risks being underfunded relative to its needs of course, and what does that mean for quality?

http://www.dn.se/sthlm/skolinspektio...riskoleskandal

Three highschools run by serious criminals who've served time for sex-crimes against children, pimping and financial crime. Why? Because we weren't particularly careful about watching out for these things.

http://www.dn.se/nyheter/sverige/har...-med-overbetyg

List of the ten most generous private schools in Sweden, assessed by the percentage of students who received a significantly higher final grade than they should have gotten based on their performance on recent (= within a few weeks of receiving final grade) standardised national tests. I like it when schools consider overall performance throughout the year when setting a student's grades but the investigations into these cases suggest that that's not the whole story. This is esp. worrying when a student receives a good grade in a subject a couple of weeks after failing a standardised test on the same subject. The significance of these practices are unclear, but one possible explanation can't be discounted: these schools have strong incentives for inflating students' grades as well as for hiding problems.

http://www.dn.se/nyheter/sverige/fri...r-skarp-kritik

Schools criticised for serious problems.

http://www.dn.se/nyheter/sverige/bri...-nya-friskolor

A quarter of private schools approved between 2008-2009 were subsequently found to not live up to the requirements on which their approval hinged (not to mention the promises they made in their application). Some of these were esp. crappy, leading to further investigations and some revoked licenses. Good thing they were evaluated at all of course!





Just so we're clear, I'm not principally opposed to letting others run schools. I take issue mostly with the naïve and unconsidered approach Sweden has taken to the school reform (actually, all privatization reforms) that has prevented us from evaluating results and addressing problems.

85% of all companies in the school sector only run one school and direct profits in the sector as a whole average around 5%. That's not a lot, but you can hide profits in many ways. Apart from salaries there're the time-honoured practices of buying overpriced services/goods from sister companies and exploiting tax laws to minimise losses incurred by sister companies. These are esp. popular among the three largest managers of private schools in Sweden, all owned by venture capital firms. Venture capitalists are crucial to many businesses but it's an approach that's ill suited to the school sector.

Re. the healthcare sector, esp. the care of the elderly and the disabled... there've been a lot of reports recently--by journalists, whistleblowers, patients and their relatives, by healthcare workers--esp. in the last year or so. To summarise, costs remain high, profits for the owners are high but aren't being reinvested properly (are rather being funneled out to tax havens), and the safety of both carers and patients is being compromised regularly. In several cases the municipalities have been forced to cancel contracts and reacquire extremely mismanaged institutions. Never mind dignity and integrity, I'd almost be happy if half-starved old people didn't get hospitalised due to severe infections just because their carers have been instructed to eg. not change diapers as often as needed.

What's bizarre is that the companies that fuck things up so badly keep getting these contracts. It's esp. frustrating when naïve (or sneaky ) municipal/county politicians repeatedly fail to negotiate properly, leading to huge profits for the private sector and a waste of public funds.

[Aimless]

Oh yeah, if you look at profits in the "proper" private school sector (the part that's run by companies) they're much higher. Just a few years ago they were at around 16%. 19% for the healthcare sector. I'm not sure if that's a good sign of competition doing the work we expect it to do. Looking at things like number of teachers per student, privately run for-profit schools have the highest number of students per teacher, in Sweden.

[ar81]

The problem of talking about privatization as equivalent of capitalism is that it ignores the fact that sometimes profit is undesirable, and sometimes profit should not prevail over people welfare. For example, in health sector, profit is undesirable.

In a normal market profit is desirable and that leads companies to try to have as much demand as possible so they can have as much profit as they can. Health economy does not work like other markets and this is why this is one of the most complex fields of economy so it is often for spacialities and master degree and above.

The problem of health market is that price is inelastic (people pay whatever price to stay alive) and there is a problem of asimetric information (people do not know if what a doctor says is right or wrong) and therefore a customer cannot evaluate quality. So these factor make the idea of competition to bring efficiency to markets useless.

Also, increasing demand in health market means having more people with health problems. So the more sick people are, the more profitable business is.

Unfortunately, people use to think health market is just like any other market, and apply popular wisdom on capitalism so the result is awful.

[GGT]

For their kid's sake, it's not unheard of parents switching districts for the better schools their. Or attempting to enroll their kids in other schools (sometimes outside their districts even).

We wouldn't be in the mess we're in now if most parents made that choice. Furthermore, many public school districts make it very difficult and frequently illegal to enrol your child in a school outside of their immediate neighborhood.

Families are limited to housing they can afford, regardless of how good/bad the schools are. What family wouldn't want to "buy" into the best school district? Switching districts is impossible if the local housing market has tanked, or a mortgage is underwater. Not all areas have mixed-housing (rentals and apartments) since the ex-urban/suburban sprawl took off about 20 years ago.

Enrolling kids outside their residential district depends on local or state laws, and property tax allocation. I'm not aware of it being illegal anywhere, but it can be too expensive when the school can charge "full cost" (since their school portion of property tax didn't contribute to the district). Our public schools are 70% funded from local property taxes, and those taxes are assessed on 100% of a property's market value (since a law change back in the mid-00's). That's the problem.



<I tried switching districts before my first child entered kindergarten. Lived in a great city neighborhood we loved, with relatively high property taxes (that offset the inner-city poverty and low revenue). The "designated" public schools were over-crowded, extra classrooms were in trailers in parking lots, the buildings were old and crumbling (one even had the water fountains turned off because the pipes were leaking lead ), the "playgrounds" were painted areas on asphalt....and even scarier: the teachers were overworked, visibly exhausted, trying to use teacher aides for classes of 38-45, some kids in wheelchairs were just sort of "parked" in the room, and there didn't seem to be much learning amid the chaos.

The "better" school district would let us enroll, but we'd have to pay ~$25,000 per year in tuition. That was in the late 90's, no idea what the fees would be now. That was higher than the best for-profit Private school, and much higher than the Catholic schools charged non-parishioners. We ended up moving into the "better" school district, and our property taxes fell almost in half.>

[GGT]

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

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).

Plus military contracts with private companies like Halliburton, etc. The state of VA has a booming economy because of these government-sponsored entities, particularly anything high-tech related. Been going on since the 70's (as AR81 says in later post).


*State cuts back on fire-fighting departments, in essence enlarging their response area beyond capability...and is forced to let "certain" structures burn.

However, the very wealthy can buy private fire services, from sprinkler systems to water-tanker response teams. They can purchase extra insurance products to cover hotels/transportation, and total replacement value for structure/out-buildings/grounds/personal valuables. They likely have the best health insurance coverage too, and a visit to the ER for 'smelling smoke' would be paid in full.



Veldan, you hit on the larger question of what is government FOR....but I was trying to ask that from the other side, by looking at privatization. I should have made a better title or OP but the gist is still there.

[Flixy]

Plus military contracts with private companies like Halliburton, etc. The state of VA has a booming economy because of these government-sponsored entities, particularly anything high-tech related. Been going on since the 70's (as AR81 says in later post).


*State cuts back on fire-fighting departments, in essence enlarging their response area beyond capability...and is forced to let "certain" structures burn.

However, the very wealthy can buy private fire services, from sprinkler systems to water-tanker response teams. They can purchase extra insurance products to cover hotels/transportation, and total replacement value for structure/out-buildings/grounds/personal valuables. They likely have the best health insurance coverage too, and a visit to the ER for 'smelling smoke' would be paid in full.



Veldan, you hit on the larger question of what is government FOR....but I was trying to ask that from the other side, by looking at privatization. I should have made a better title or OP but the gist is still there.

You say that like it's necessarily a bad thing (and keep in mind I'm fairly leftwing, but also realistic). All things, including fire-fighting, come down to cost-benefit at some point. You can place ten times more firefighters and ten times more expensive equipment , but if it won't have a big impact on fire safety, it isn't money well spent. I'm not saying cuts are good either, but you can't expect unlimited funding either. You need to find a good balance (which might be off where you live, I wouldn't know). I would like to add that letting certain structures burn isn't usually because of too low funding. Once a building is a 'total loss' anyway, there's not too much value in fighting the fire instead of a controlled burn. And keep in mind that firefighting is dangerous, so if the building is a total loss anyway, why risk lives?

Now, as long as the general fire fighting is adequate, I don't see anything wrong with buying better fire services, or health insurance, for yourself. Why not? Over here there is mandatory basic coverage for health care, and if you want better coverage, you're free to get better insurance as long as you pay for it. I don't see anything wrong with that, as long as it doesn't go at the expense of the standard service of course. You think it's wrong as well that industrial plants have their own fire fighters? Hell, even my university has their own fire department. Or what about security at the mall, or patrolling industrial sites at night? The police can't handle all that (nor is it supposed to), so what's wrong with people paying for extra security themselves? It's their money, their choice.

[GGT]

Flixy, I was referring to real events that have been in the news the couple of years. In CA, where homeowners had paid taxes for firefighting, deep budget cuts meant closing departments and "sharing" coverage for expanded areas, with fewer trucks and personnel. Calling 911 for fires -- even in densely populated neighborhoods -- met with non-response, and people trying to douse their own fires with garden hoses. Not a great idea when CA has so many wildfires to begin with, fires jump into hundreds of acres burning, and turns into massive (and expensive) evacuations.

There've been other reports where homeowners had paid what was considered county fire protection, but turned out to be more like "donations" to volunteer fire departments, and response wasn't guaranteed. Other stories (mostly in the south) where people who were delinquent on their $50 annual "fee" were put on a no-response list. Or firefighters show up at a home ablaze, with a hydrant right there or water in a tanker, but won't intervene because it's 'outside their district', so they stand around doing nothing. (I think Lewk posted a similar story about fire/rescue not helping a drowning person because it wasn't in their 'jurisdiction', or something.)

I wouldn't call any of that adequate, moderate or balanced firefighting. But I also think public fire protection is a crucial service, and should only be left to private/volunteer/on-your-own attitudes in remote or very rural areas. And only if people clearly understand that. Our public funding and zoning is all over the map, between states and counties. Some of our medical emergency response (ambulance service) comes via fire departments. A call for a fire may not be answered, but if you're burned in that fire...they'll send an ambulance. That can mean dispatching EMTs in a municipal fire dept vehicle, or a "volunteer" fire department, or a "private" ambulance company.

Funding isn't unlimited, of course. And we definitely need to restructure how these public services are funded and provided. But budget cuts shouldn't mean folks trying to put out fires with a garden hose, or only getting help after they've been hurt in the attempt. That's just crazy.

[GGT]

addendum: I looked at my annual municipal tax bill that's predominantly "Fire Protection". It's a Real Estate tax, separate from our School Tax (also a Real Estate tax). Imbedded in both are things like road maintenance, snow and leaf removal, new road construction, administration costs, public employee benefits, etc. Public water, sewer, and trash removal are billed separately.

My public fire protection tax is a four digit figure, but still ~ 1/4 of school taxes. I don't mind paying for great public services, even paying more for those who can't afford it. But it's stunning to learn my "counterpart" in MN has a total RE tax bill, that funds public education/fire/police/infrastructure....that's less than my fire protection bill. They don't have added taxes to explain the disparity, but they do get more funding from the state coffers than we do.

[Dreadnaught]

So I missed all of this whilst on my Socialist Sojourn. But thank you for putting all of this down. I guess my top-level response is: aren't these stories a sign that things are mostly working?

The schools are screwing up in various ways (some minor, some less minor). This is natural in any organization. The difference is the problems are being exposed and action is being taken in most cases, without an ossified bureaucracy needing to lumber itself to doing things differently.

One of the principles behind privatization is that large organizations will always mess things up. And they will always try to do things differently. But the course, in the long term, is pushed in the right direction because of the risk of losing the right to conduct business; the risk of regulatory/financial sanction; the risk of negative media scrutiny; and the risk of collapsing as a business.

Which is funny because the only thorough investigation with remotely current information was published late last year and that report concluded that there is too little evidence to support any strong conclusions about the success--or total failure--of the school reform, while also pointing out some of the problems that have cropped up. The govt. has recently instated a commission tasked with investigating these matters; we have news reports to work with in the meantime. For the sake of simplicity I'll refer to all schools not run by state/municipal/county as "private", although there's really a wide range of owners.

http://www.dn.se/nyheter/politik/bjo...r-om-friskolor

Minister of education criticises private schools for failing to provide school libraries, school nurses and counselors. (law was or is being changed to fix this problem)

http://www.dn.se/sthlm/fa-elever-ger-kris-pa-friskolor

Not even half of the 120 privately run highschools have managed to fill even half of their spots. This is partly because Swedes stopped having babies but also partly because of handing out too many licenses to run schools. A school with too few students risks being underfunded relative to its needs of course, and what does that mean for quality?

http://www.dn.se/sthlm/skolinspektio...riskoleskandal

Three highschools run by serious criminals who've served time for sex-crimes against children, pimping and financial crime. Why? Because we weren't particularly careful about watching out for these things.

http://www.dn.se/nyheter/sverige/har...-med-overbetyg

List of the ten most generous private schools in Sweden, assessed by the percentage of students who received a significantly higher final grade than they should have gotten based on their performance on recent (= within a few weeks of receiving final grade) standardised national tests. I like it when schools consider overall performance throughout the year when setting a student's grades but the investigations into these cases suggest that that's not the whole story. This is esp. worrying when a student receives a good grade in a subject a couple of weeks after failing a standardised test on the same subject. The significance of these practices are unclear, but one possible explanation can't be discounted: these schools have strong incentives for inflating students' grades as well as for hiding problems.

http://www.dn.se/nyheter/sverige/fri...r-skarp-kritik

Schools criticised for serious problems.

http://www.dn.se/nyheter/sverige/bri...-nya-friskolor

A quarter of private schools approved between 2008-2009 were subsequently found to not live up to the requirements on which their approval hinged (not to mention the promises they made in their application). Some of these were esp. crappy, leading to further investigations and some revoked licenses. Good thing they were evaluated at all of course!





Just so we're clear, I'm not principally opposed to letting others run schools. I take issue mostly with the naïve and unconsidered approach Sweden has taken to the school reform (actually, all privatization reforms) that has prevented us from evaluating results and addressing problems.

85% of all companies in the school sector only run one school and direct profits in the sector as a whole average around 5%. That's not a lot, but you can hide profits in many ways. Apart from salaries there're the time-honoured practices of buying overpriced services/goods from sister companies and exploiting tax laws to minimise losses incurred by sister companies. These are esp. popular among the three largest managers of private schools in Sweden, all owned by venture capital firms. Venture capitalists are crucial to many businesses but it's an approach that's ill suited to the school sector.

Re. the healthcare sector, esp. the care of the elderly and the disabled... there've been a lot of reports recently--by journalists, whistleblowers, patients and their relatives, by healthcare workers--esp. in the last year or so. To summarise, costs remain high, profits for the owners are high but aren't being reinvested properly (are rather being funneled out to tax havens), and the safety of both carers and patients is being compromised regularly. In several cases the municipalities have been forced to cancel contracts and reacquire extremely mismanaged institutions. Never mind dignity and integrity, I'd almost be happy if half-starved old people didn't get hospitalised due to severe infections just because their carers have been instructed to eg. not change diapers as often as needed.

What's bizarre is that the companies that fuck things up so badly keep getting these contracts. It's esp. frustrating when naïve (or sneaky ) municipal/county politicians repeatedly fail to negotiate properly, leading to huge profits for the private sector and a waste of public funds.

[GGT]

....
Re. the healthcare sector, esp. the care of the elderly and the disabled... there've been a lot of reports recently--by journalists, whistleblowers, patients and their relatives, by healthcare workers--esp. in the last year or so. To summarise, costs remain high, profits for the owners are high but aren't being reinvested properly (are rather being funneled out to tax havens), and the safety of both carers and patients is being compromised regularly. In several cases the municipalities have been forced to cancel contracts and reacquire extremely mismanaged institutions. Never mind dignity and integrity, I'd almost be happy if half-starved old people didn't get hospitalised due to severe infections just because their carers have been instructed to eg. not change diapers as often as needed.

What's bizarre is that the companies that fuck things up so badly keep getting these contracts. It's esp. frustrating when naïve (or sneaky ) municipal/county politicians repeatedly fail to negotiate properly, leading to huge profits for the private sector and a waste of public funds.

We've had the same scandals over here. Some originated in the judicial system --- like the juvenile court judge found guilty of sentencing troubled youth to a private institution for kick-backs (or he gained profit as a shareholder in the corporation, I can't remember specifics). Kids that didn't even need to be 'institutionalized'.

The elderly Medicaid patients in my area have only one county-run facility, sort of the "last resort" for the destitute, and there's a waiting list. The rest are either placed in private group homes (notorious for elder abuse and/or neglect, health board violations, etc.) or can get sporadic home-assistance -- if they're living with family that's also destitute or below federal poverty levels.

We don't seem to do a very good job at combining public funding with private care providers. Not in quality, safety, management or oversight, or cost-containment. Our childrens' foster care system has an especially bad reputation that way, despite the success stories of some truly great foster parents. I think one of our mistakes is not having enough professional, well-paid public social workers who can act as real Case Managers, and make routine home-evaluation visits. Because we're loathe to have public workers of any kind....?? I don't really know

[Aimless]

So I missed all of this whilst on my Socialist Sojourn. But thank you for putting all of this down. I guess my top-level response is: aren't these stories a sign that things are mostly working?

The schools are screwing up in various ways (some minor, some less minor). This is natural in any organization. The difference is the problems are being exposed and action is being taken in most cases, without an ossified bureaucracy needing to lumber itself to doing things differently.

One of the principles behind privatization is that large organizations will always mess things up. And they will always try to do things differently. But the course, in the long term, is pushed in the right direction because of the risk of losing the right to conduct business; the risk of regulatory/financial sanction; the risk of negative media scrutiny; and the risk of collapsing as a business.

Given the abysmal results we're seeing from the system as a whole I wouldn't say that we're getting our money's worth in the short or in the long term. The issue is with the claims of this system being much better on the whole--a "tremendous success"--compared to the alternatives, claims that don't have much evidence to back them up at the moment. The lack of evidence to support the positives, along with the evidence for important problems--apart from the articles, things like how one in three highschoolers now finish highschool without complete grades and one in five ninth graders fail the national test in maths--should make us more cautious in our endorsement of this system. It is not a system that constantly pushes all actors to become better. Rather it is a system where many actors are exploiting various strategies to ensure survival and considerable profitability while barely being "good enough".

It's proven surprisingly difficult to expose problems in this system. Or perhaps it's not so surprising given the strong incentives for schools to hide problems and for politicians to ignore problems or--better yet--to simply not find problems that need to be ignored. Sanctions, negative press and voting with your feet work when problems are reliably uncovered and consistently addressed and where the "consumers" are powerful. Most kids and families--esp. the growing group of the not-well-off--aren't all that free to switch highschools in search of perfection because they live in the real world rather than a model world of perfect information and perfect freedom, so they'll put up with "barely good enough". We're now beginning to appreciate the true social costs.

There are other ways to open up the school sector. Sweden is fairly unique in Europe in letting its school system be plagued by venture capitalists and shortsighted shareholders. I imagine the Dutch system may be a little better but I don't know enough about that system. I'm not opposed to opening up the school sector, I'm just opposed to the naïve, blind, deaf and dumb approach.

[Dreadnaught]

Not that I'm intimately familiar with the long-term education history of Sweedistan at all, but I'm detecting a bit of an assumption here: that it was easier to measure results and expose problems under the old system, and that the voucher system provides more incentive to do shitty things.

Any state-managed approach leads to substantial bureaucracies "exploiting various strategies to ensure survival and considerable profitability". But, because they exist with a de-facto monopoly and operate within the realm of the government, it is much harder to expose and tackle these problems. That's the reality I live in on the other end of the school choice spectrum.

[Aimless]

Helped no doubt by attempts to incentivise schools eg. by making their reimbursement contingent on students' performance on standardised tests

Re. the assumption, I have no idea whether or not it was easier but, now that you raise the point, I would not be surprised if it indeed were easier before the insanely rapid proliferation of new privately run schools in this tiny country with its fairly strong tradition of recording and making public more or less everything done by or at its public institutions. If nothing else this proliferation alone--almost 700 new approvals per year at its peak before strong public criticism--means far more to do for any agency responsible for oversight. However, if it is easier to investigate and to evaluate under the current system--if, indeed, that transparency is one of the sought-after benefits--then the failure to thoroughly investigate and to evaluate is truly damning.

For politicians there will always be mixed incentives wrt how they portray education. No-one wants voters to hold them responsible for fucking things up, but everyone wants voters to think there are problems left that only they can solve. From the PoV of.schools in a state that highly prioritises socialised education, there are incentives for emphasising their problems, problems that can only be fixed with better funding so pls give moar. For the record, prior to the reform almost all schools in Sweden were run by the municipalities. These are tragic but not very large bureaucracies where you know the person you're working with/against.

There were good reasons for the school choice reform--eg. popular support--but those reasons did not in themselves mandate exposing the sector to the folly of shareholders or to the practices of venture capitalists, to whom harmful incentives may be stronger than positive incentives such as wanting to do good. I've heard of alternative approaches in Europe, perhaps eg. Flixy can expound on those with his impressions of the Dutch system.

[ar81]

Paul Krugman writes about privatization...

Prisons, Privatization, Patronage
http://www.nytimes.com/2012/06/22/op...patronage.html

Very often people say that privatizing leads to more efficiency and competition. But if you read Krugman, you will realize how untrue it is.

[Loki]

So the problem is not with privatization but with crony privatization...

[ar81]

It is more likely that privatization become crony than the opposite. There is no incentive to do the right thing. Non crony privatization is just utopia.

[Loki]

This must be why Britain and most of Western Europe, which all privatized numerous industries in the 1980s and 1990s, are such corrupt crapholes.

[GGT]

It is more likely that privatization become crony than the opposite. There is no incentive to do the right thing. Non crony privatization is just utopia.

There's just as much "cronyism" in the private sector as there is in the public sector. It's just another word for Favoritism. Taken to its extreme, it's just another word for Collusion. I'm not convinced that private entities are less susceptible to that behavior than anyone else. At least unions have a group of members they purportedly represent. Much like legislators are supposedly representing their constituents and/or donors.

But when money is the end-all and be-all, everyone and anyone can be bought. That's what's fucked up.

[Veldan Rath]

While money is part of it, it's not the totality.

It's power.

When you give these igits incredible power over other people THAT is why they are corruptible, and THEN money comes into play.

[ar81]

There's just as much "cronyism" in the private sector as there is in the public sector. It's just another word for Favoritism. Taken to its extreme, it's just another word for Collusion. I'm not convinced that private entities are less susceptible to that behavior than anyone else. At least unions have a group of members they purportedly represent. Much like legislators are supposedly representing their constituents and/or donors.

But when money is the end-all and be-all, everyone and anyone can be bought. That's what's fucked up.

There's just as much "cronyism" in the private sector as there is in the public sector. I have worked for both. If you remove the ability of money to be exchanged for goods, all the world economy would be just a videogame. It seems silly that people die, get killed or mistreat other people just for money. It would be like doing so because of a score in Pacman. I came to the conclusion that when people stop being human and become videogame avatars, it is when you may call them greedy and corrupt.

[GGT]

While money is part of it, it's not the totality.

It's power.

When you give these igits incredible power over other people THAT is why they are corruptible, and THEN money comes into play.

Money is the driver and facilitator, though. Money = power. Power can be bought when it starts as "campaign donations", since the only way to run for elected office requires LOTS of those "donations". To complicate matters even further, "free speech" has been equated with money, and corporations have been equated with people.

Therefore, in theory, one mega-billionaire = one mega-billionaire corporation = one citizen. Since one citizen = one vote, money doesn't really matter in the scheme of power plays, right? That's a most absurd denial of our modern age, a denial of concentrated wealth and power, and naive assumptions about our "representative" democracy.

[Veldan Rath]

Again, you willfully ignore the point. If the politicians didn't have something worth bribing for (power) the wouldn't be bribed in the first place!

And to quote a favored villain on this forum: Power is power.

[GGT]

Veldan, I'm not ignoring your point. I just don't agree.