Why Privatization and Govt Contracting Is Wrong

Privatization keeps popping up as a solution to our economic woes, and you may be surprised to learn I am against it.  Let's look to wikipedia for a quick synopsis of the pro and con:

Proponents of privatisation believe that private market factors can more efficiently deliver many goods or service than governments due to free market competition. In general, it is argued that over time this will lead to lower prices, improved quality, more choices, less corruption, less red tape, and quicker delivery. Many proponents do not argue that everything should be privatised. According to them, market failures and natural monopolies could be problematic. However, some Austrian school economists and anarcho-capitalists would prefer that every function of the state be privatised, including defense and dispute resolution.

Opponents of privatisation dispute the claims concerning the alleged lack of incentive for governments to ensure that the enterprises they own are well run, on the basis of the idea that governments are proxy owners answerable to the people. It is argued that a government which runs nationalized enterprises poorly will lose public support and votes, while a government which runs those enterprises well will gain public support and votes. Thus, democratic governments do have an incentive to maximize efficiency in nationalized companies, due to the pressure of future elections.

Of course the fundamental problem is that a state defined as a territory with a monopoly on violence has no intrinsic right to exist, since violence is wrong, and one cannot derive good by doing evil.  Given that, it has not right to privatize or not.  Such a system cannot be reformed, with or without privatization.


Now I would call "corporatization" a process like privatization in which all of the stakeholders are givena share of a governmental entity, for them to do with as they wish, since the government, on its way to extinction, would be turning over its assets to private propoerty owners.   For example, the US Postal Service would have all of its assets and liabilities turned over to all those presently working for the system, or otherwise drawing value (pensioners, etc.)  The USPO would be told "in 24 months you lose your monopoly of first class mail, and any other association with government." All of the people, assets and liabilities, of the USPO would then be in competition with any and all entities who wish to compete.


The same process would apply to say school districts.  All of the assets and liabilities of the district would be deeded to teachers past and present, pro rata, and they would lose their ability to tax and otherwise draw on the community by force.


The result would be more innovation, plus more better cheaper faster on the commodities.






violence....

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