Open Thread - June 22, 2016- Overview of the Impacts of Privatization
In one of my first essays in this series on neo-liberalism, I referenced an excellent article titled What is Neoliberalism? This article was written by Elizabeth Martinez and Arnoldo Garcia and published by Corp Watch. This article provided an excellent definition of neo-liberalism as well as a listing of the five characteristics of neo-liberalism. Among the five characteristics of neo-liberalism is the concept of privatization.
PRIVATIZATION. Sell state-owned enterprises, goods and services to private investors. This includes banks, key industries, railroads, toll highways, electricity, schools, hospitals and even fresh water. Although usually done in the name of greater efficiency, which is often needed, privatization has mainly had the effect of concentrating wealth even more in a few hands and making the public pay even more for its needs.
In my last essay on neo-liberalism, I wrote about the lack of empathy in our society, especially as it relates to the neo-liberal ideology. The extent to which neo-liberalism has permeated all aspects of our lives has made us a more selfish and self centered society. We clearly lack empathy toward each other, toward others in far away countries, and toward the very earth and all living things upon it. The ideology of neo-liberalism is de-humanizing in a time in which we need far more humanity than ever before.
When the public owns the facilities and services that they use, each member of the public has a stakeholder investment in maintaining those public facilities and services at the optimal level. Privatization takes the concept of public ownership for the common good and transfers it to a private faceless corporation whose main concern is the maximization of profits for the shareholders. The net result is often worse service and higher costs when public facilities and services are privatized and the sense of pride of ownerngship by the citizens is lost. Public ownership is a powerful concept that builds a sense of community among the citizenry.
In August 2013, Juan Cole of Informed Consent, republished Neoliberalism Fail: Top 8 Ways Privatization has Harmed us All written by Paul Buchheit. In this article Buchheit lists the ways in which privatization promoted by the neo-liberal ideology has negatively affected our society. Those include the following: (1) Healthcare; (2) Water; (3) Internet, TV and Phone; (4) Transportation; (5) Banking; (6) Prisons; (7) Education; and (8) Consumer Protection.
Looking broadly at each of these impacts of privatization individually, we can easily see what has been lost to the citizenry especially when compared to the outcomes of other nations.
(1) Healthcare - Even with the Affordable Care Act, not much has been done to contain costs and make medical care affordable. AS of 2013, the United States spent over 17% of GDP on health care compared to the next highest country, France at 11.6%. What the Affordable Care Act did first and foremost is solidify the insurance companies role as middle men in our healthcare system. Insurance is not healthcare when the most affordable plans have high deductibles, far too high for the poorest citizens to be able to afford to go to the doctor. As for outcomes, among eleven western industrialized nations, the United States ranked dead last in overall healthcare.
Our private health care system is by far the most expensive system in the developed world. Forty-two percent of sick Americans skipped doctor's visits and/or medication purchases in 2011 because of excessive costs.
(2) Water - Water has become a commodity that some analysts believe may rival that of precious metals, agricultural products and even oil. Further, water is something that should be a basic right for every human being, but companies are allowed to pollute our rivers and ground water with chemical discharges that can poison an entire population as evidenced in Flint, Michigan.
Numerous examples of water privatization abuses or failures have been documented in California, Georgia, Illinois, Indiana, New Jersey, Texas, Massachusetts, Rhode Island — just about anywhere it's been tried. Meanwhile, corporations have been making outrageous profits on a commodity that should be almost free.
(3) Internet, TV, and Phone - Deregulation was supposed to provide better service at lower prices. However, such services in Europe and many Asian countries are both far less expensive and higher quality.
(4) Transportation - Public high speed rail systems are prominent in most European countries. Many critics have said that the US is too large geographically for such a system and yet China is on a fast track to build the largest high speed rail system in the world. As the world speeds ahead, the US falls behind in its public transit infrastructure. Add to that, the debacle of privatizing formerly public facilities.
With privatization comes automatic rate increases. Chicago surrendered its parking meters for 75 years and almost immediately faced a doubling of parking rates. California's experiments with roadway privatization resulted in cost overruns, public outrage, and a bankruptcy...
(5) Banking - Need we say any more? Banking has become a casino gambling establishment where the house always wins thanks to deregulation. Matt Taibbi of Rolling Stone has written extensively on the subject of the banks. This is one of the areas in which neo-liberalism has literally destroyed lives and it remains basically unfettered as of today. Banking deserves its own essay beyond just this summary.
This is all the result of free-market deregulated private business. The best-known public bank, on the other hand, is the Bank of North Dakota, which remains profitable while serving small business and the public at low cost relative to the financial industry.
(6) Prisons - The get tough on crime legislation and three strikes you're out led to mass incarceration which gave an opening to the private prison industry. Most private prison contracts require that the facility remain filled or the state pays a penalty. This creates an incentive on the part of the state to keep these facilities full. The poorest and weakest of our citizens are the most vulnerable to be incarcerated for relatively minor crimes such as marijuana offenses.
The need to fill privatized prisons has contributed to mass incarcerations for drug offenses, with African Americans, who make up 13% of the population, accounting for 53.5 percent of all persons who entered prison because of a drug conviction. Yet marijuana usage rates are about the same for Blacks and whites.
(7) Education - This is an area which deserves greater in depth exploration in a separate essay. The hijacking of our educational system does a massive disservice to our children. We see privatization of our education system through charter schools, extensive testing, and private for profit schools. Each of these funnels money off from public education into corporate profits while failing to provide quality education. Privatization of education also destroys our future by preventing our children from reaching their full potential and being able to contribute their best to our society.
Just as with prisons and hospitals, cost-saving business strategies apply to the privatization of our children's education. Charter school teachers have fewer years of experience and a higher turnover rate. Non-teacher positions have insufficient retirement plans and health insurance, and much lower pay.
(8) Consumer Protection - This is an umbrella impact of privatization. The effect of loosening consumer protection laws enables greater corporate profits while transferring the burden of corporate misdeeds to the public. Most of consumer protection laws and rules are intended to prevent corporations from endangering the general public. Many of the negative impacts that we are now dealing with were a result of deregulation.
Deregulation not only deprives Americans of protection, but it also endangers us with the persistent threat of corporate misconduct.
The above essay is a just a brief summary of the eight greatest impacts of privatization as analyzed by Paul Buchheit. In the future, I hope to write more detailed essays on long ranging effects of some of these impacts.
For those who may be interested, below are links to the previous essays in the neo-liberalism.
Week 1 - The Curse of Neo-liberalism
Week 2 - Neo-liberalism Part 2
Week 3 - The Neo-liberal Myth of Meritocracy
Week 4 - Characteristics of Neo-liberalism
Week 5 - Neo-liberalism - Obama and the Clintons
Week 6 - Neo-liberalism - The Legacy of Bill Clinton
Week 7 - Neo-liberalism - Lack of Empathy
As always, this is an open thread, so feel free to comment on whatever you wish.
Comments
Thank you for this extensive and comprehensive
series on neo-liberalism. The fact that privatization has failed and continues to fail the people, yet creates enormous profits for the capitalists, is enough to convince a reasonable person that this system is organized greed and, at its core, anti-social.
The high stakes testing in our public schools are designed to have a high rate of failure for those forced to take them. It also is a failure for public school teachers because the results - foreordained - often result in the closing of schools to be replaced by charter schools where make-it-up-as-you-go-along rules education - as long as the profits roll in. It is legal for students to opt-out of the high stakes tests but teachers have been disciplined for telling parents and/or students about that right. Of course, the copyrighted tests themselves are a large generator of profits.
One last comment: You point out how much the USA pays for health care and that insurance is certainly not health care. Studies that I have seen quoted say that the amount the USA spends on this malfunctioning system will double with a decade. Obamacare seems to have been conceived as a short term raid on the public before the whole system implodes.
Once again, many thanks.
"The justness of individual land right is not justifiable to those to whom the land by right of first claim collectively belonged"
Thank you, duckpin!
Healthcare, Education, and perhaps Banking may be subjects of future individual essays. Other essays on privatization may also be in the works. I will see how the research carries me on it. Thank you for your reading and always insightful comments.
Do I hear the sound of guillotines being constructed?
“Those who make peaceful revolution impossible will make violent revolution inevitable." ~ President John F. Kennedy
You're welcome
If you address banking, I would like to learn about the old post office banking system that served the country so well for a long period of time. Also, I've read positive things about the North Dakota State Bank, ND being the only state will its own bank. I understand that this bank weathered the financial crash very well.
The USA used to do things well but the "fault" was that it didn't generate private profits so many things had to go.
"People Before Profits" is an old saying but I think it's apt today.
"The justness of individual land right is not justifiable to those to whom the land by right of first claim collectively belonged"
Add in globalization and things get worse.
My local electric and gas company (not a cooperative) got sold to a company in Spain. Spain. Bottom line is all. NYS just agreed to new rate increases to of course be passed along to customers, individuals paying higher unit costs than industry, of course.My daughter lives in a small village where electricity is somehow cooperative but the power lines ang gas supplies are operated by the company in Spain.
Hey! my dear friends or soon-to-be's, JtC could use the donations to keep this site functioning for those of us who can still see the life preserver or flotsam in the water.
Globalization
Globalization is another one of the characteristics of the neo-liberal ideology. Good morning, riverlover!
Do I hear the sound of guillotines being constructed?
“Those who make peaceful revolution impossible will make violent revolution inevitable." ~ President John F. Kennedy
Good Morning, gulfgal and
all!
Thank you for the continuing neoliberalism ed, gulfgal, and the Open Thread.
Just dropped in to pass out a few thumbs up.
Happy Wednesday everybody!
Good Morning, O'Linda!
Thumbs up are always appreciated! Thank you for dropping by.
Do I hear the sound of guillotines being constructed?
“Those who make peaceful revolution impossible will make violent revolution inevitable." ~ President John F. Kennedy
This is a great article. Thanks for all the info.
I'm afraid for our health care for the reasons you give, and how high costs will go up. But also, right now a disturbing trend is how much they are lower than expected:
http://www.vox.com/2016/6/21/11981610/health-spending-slowdown-obamacare
I fear that Bernie's figure of 40,000 people per year, many of whom are insured, dying because they don't go to the docs in time for the medical problems they have, is rising precipitously right now. I certainly think twice about going because of the copays. But a lot of people have very high yearly deductibles while they can barely afford the exorbitant price of the insurance to begin with.
On a different note, the small city of Bath, NY, located in a firmly republican district, has its own publicly owned utility company. I don't know much about it, but the people pay a lot less for their power than I do, just about 50 miles east of there.
Thank you, sfern!
And thank you for the valuable link too. You may see it referenced in a future essay.
My hometown has a publicly owned electric utility. At one point during the push for privatization, some of the city commissioners wanted to sell the utility. The public was up in arms over that prospect even though our electric bills were no lower than those of privately owned companies. The public had a sense of ownership and control that they did not want to relinquish. Thankfully the city commissioners listened.
Do I hear the sound of guillotines being constructed?
“Those who make peaceful revolution impossible will make violent revolution inevitable." ~ President John F. Kennedy
Neoliberalism in the news ...
Teachers in the Mexican state of Oaxaca are protesting Neoliberal education "reform," eight have been shot dead. Education reform, in the form of charter schools and for-profit "universities," has been embraced by both major parties in the US.
We wanted decent healthcare, a living wage and free college.
The Democrats gave us Biden and war instead.
People are dying
as a result of neo-liberalism and its very close cousin neo-conservatism. It is shocking that the value of human lives has become far less than that of the insatiable greed that neo-liberalism has spawned worldwide.
Do I hear the sound of guillotines being constructed?
“Those who make peaceful revolution impossible will make violent revolution inevitable." ~ President John F. Kennedy
Good morning gg
Thanks for your informative and timely series. As to Azazello's comment, I caught a good article this morning that might be of interest: http://www.counterpunch.org/2016/06/22/the-cntes-battle-for-education/
As a retired teacher, the education aspects are near and dear to my heart. Another factor in the privatization is the outright purchase of departments and schools at Universities by the likes of the Koch Brothers.
https://www.publicintegrity.org/2014/03/27/14497/inside-koch-brothers-ca...
The quarter million given to Troy University in Alabama established a department dedicated to taking out Alabama's quite good pension system:
Our retirement system makes money for our state. We (the retirement system) established a profitable golf trail, and have helped the state repeatedly. But the Koch's don't want the gov't providing a decent retirement for the state workers. It's all too much.
Well thanks again for your work on this important topic gg!
“Until justice rolls down like water and righteousness like a mighty stream.”
I think I am correct in saying George Mason U., in VA,
was one of the first to welcome billionaire money to fund professorial chairs and let the funder(s) pick the professors. It's a bastardization of academic traditions.
There's a big push among the Wealthers to defund English, comparative literature and sciences like sociology and anthropology because these disciplines don't serve the uncritical thinking neo-liberalism needs from its workers. (A recent study I saw quoted reveals that liberal arts majors start out making less per year than math, physics or engineering grads but by the time a person reaches 45 or 50 the income level is the same or higher.)
"The justness of individual land right is not justifiable to those to whom the land by right of first claim collectively belonged"
My alma mater,
Florida State University has been bought out by the Koch brothers too.
While I did not mention it in my overview, I do intend to address the buying off of our education system by wealthy donors through endowed chairs. While other aspects of the impacts of privatization are easily seen today in the form higher costs, to me, the most important impact of the eight enumerated is the impact of privatization upon education. I definitely want to write a single essay on that subject.
Thank you for your great comment and the links, Lookout!
Do I hear the sound of guillotines being constructed?
“Those who make peaceful revolution impossible will make violent revolution inevitable." ~ President John F. Kennedy
Hello and Thank You
for your extensive and clear analysis! This is a wonderful undertaking and I look forward to reading your future essays.
On the subject of the "de-naturing" of the American educational system, I would suggest that the demise began before neoliberalism per se took hold of our politics, economy and social mind-set.
I thought that Chris Hedges' interviews with Sheldon Wolin were both really informative and, in a lot of ways, very sympathetic. Wolin has passed away since these interviews were posted. He was a professor of political science. The interviews include discussions of how his intellectual activity--both publishing and even his own thinking--were subject to outside pressure right from the beginning of his career (after WWII).
In case you aren't already familiar with these, here's a link:
Hedges and Wolin
Have a nice evening!
Mrs. Zello is also a retired teacher,
K-3 mostly, 30-some years in the trenches. We live in AZ, which was ground-zero for education reform, back when it was strictly a Republican issue. The demonization of public school teachers, which is always a pre-requisite for the privatizers, has been going on here for decades and the privatization of public education is one of the things that motivated me to start blogging in the first place.
We wanted decent healthcare, a living wage and free college.
The Democrats gave us Biden and war instead.
Public schools
The American system of universal, free, compulsory education is one of our triumphs. I never thought I'd see the system, and its teachers, dragged through the mud and dismantled.
School teachers have been a loyal Democratic bloc but that's not good enough for the money junkies who now run things. They want to squeeze every dollar they can from local taxes, fire school teachers who have state pensions, and set up phony charter schools.
Louisiana used the hurricane disaster to close all public schools in New Orleans and privatize the system. I wonder if anyone can tell me how this is working out.
Obama, through Arne Duncan, comes off as a villain in this area.
"The justness of individual land right is not justifiable to those to whom the land by right of first claim collectively belonged"
Jakkalbessie and I are both retired AustinTX HS teachers.
We introduce ourselves as 'Recovering Educators.'
The 2008 economic fail was used by the disaster capitalists to gut Texas Schools, cut teacher numbers, and roll back many of the gains we had made over the years.
Now the retiree health benefit which was never fully funded as was all other State Employee benefits is in huge financial trouble, needs to be fully funded but proposed is huge premium increase etc.
A truth of the nuclear age/climate change: we can no longer have endless war and survive on this planet. Oh sh*t.
Public school teachers were always underpaid.
Teaching used to be the lowest paid profession but I guess now with the corporate clampdown gathering steam. teaching is no longer considered a profession and teachers are just so much expendable dross.
It's a sorry situation.
"The justness of individual land right is not justifiable to those to whom the land by right of first claim collectively belonged"
Good morning gg and all you beautiful c99ers :)
There is nothing which I dread so much as a division of the republic into two great parties.. This...is to be dreaded as the greatest political evil under our Constitution.--John Adams
Good Morning, kharma!
I hope you are doing well today. My husband just told me that Rubio (the truant senator) is back running for his old Senate seat. https://www.washingtonpost.com/news/powerpost/wp/2016/06/22/marco-rubio-...
Do I hear the sound of guillotines being constructed?
“Those who make peaceful revolution impossible will make violent revolution inevitable." ~ President John F. Kennedy
Good Morning, gulfgal, and hi, JtC, I think the neoliberalism
series of gg deserves a link on the right hand side. It's just that good and we should be able to access the series with one click ...
(for the mental click challenged like me....)
I rec. your neo-liberalism series hundred times if I could. What you call a summary is to me the way I like to learn about a subject. Straight forward enough to not get distracted. Thank You.
Just a little link to show how much chickenshit some states are imposing on little people's chickens. May be those urban chicken farmers should take their chickens and let them shit all over the statehouse, where those glorious laws have been written. Jeez.
Michigan Loses ‘Right To Farm’ This Week: A Farewell To Backyard Chickens and Beekeepers
It's easy to see that food shortage and water shortage will be a "revolution and rebellion causing catalysts", even in this "biggest and best banana republic of the world". Sorry, don't want to offend, but all of that is real utter shit. Y ou don't even want to own land anymore, if everything is getting regulated away under your nose for your local business community and towards corporate farming entities. Can't even have a couple of chickens and rabbits? Why? Because some city slickers are offended by some cocks who wake them up early or by some wind towers "destroying" their views? How darn stupid.
So, where do I go to raise my chickens now? And my sheep? And my little piggy?
https://www.euronews.com/live
Good morning, mimi!
Thank you for the nice comment. I am including links to my previous essays in this series with every Wednesday post.
The issue of keeping farm animals in the city has always been a sensitive one. In my home town, we had ordinances that went back many decades that prevented people from doing so. Chickens could be kept, but not roosters. I do not believe we regulated rabbits as they were seen as being pets. I personally do not object to chickens or rabbits. Larger animals do present a problem if there is not sufficient land to support them.
In the end, people need to be able to feed themselves somehow. There should be a healthy medium between the health and safety issues versus the simply aesthetic ones.
Do I hear the sound of guillotines being constructed?
“Those who make peaceful revolution impossible will make violent revolution inevitable." ~ President John F. Kennedy
I think, if you have half an acre, you can feed your family
really well, if you know how to grow vegetables, have some chickens (no rooster) and some rabbits and may be a little pond with some fish.
My parents lot was around 1 acre. The previous owner took in several wwII disabled German soldiers after 1945 and she fed all of them from what she grew on that acre. My parents took it over in 1954 and fruit trees, potato rows, and vegetables were plentiful. The lot had also two wells with groundwater (still working, but not anymore allowed to use alone, have to have city municipal water - but heh some laws are made to break them) and heating was with coal .
Enough to survive and feed a bunch of people. Today it's all gone but one or two fruit and nut trees. It's a shame.
https://www.euronews.com/live
A book from 1935
called "Five Acres and Independence" delves into this sustainable life choice. It's still in print, I believe.
"The justness of individual land right is not justifiable to those to whom the land by right of first claim collectively belonged"
Hey mimi
I still live that way - eating out of the garden and putting up much of our food. During WWII the concept of a victory garden in every yard was promoted. Also people recycled everything they could. Why does it take tragedy to promote good ideas and help each other? Wish I could share a tomato out of the garden with you. They are just coming in and we're eating them seems like every meal. We'll be tired of them in a couple of months. All the best!
“Until justice rolls down like water and righteousness like a mighty stream.”
I remember very well
the year my husband grew several plants of yellow squash and zucchini. We had two kinds of squash every night for dinner and I was making zucchini bread on the side along with giving much of it away. After a month of squash, zucchini, squash, zucchini, and more zucchini, I declared that I had had enough. It was a long time before I ate either squash or zucchini. LOL
Do I hear the sound of guillotines being constructed?
“Those who make peaceful revolution impossible will make violent revolution inevitable." ~ President John F. Kennedy
Thank you GG!
I can't believe how much we've gone off the rails.
I will be away for a week. Going kayaking camping in a caldera. Dear friends are staying at our house with the pooties.
When I get back, I should have a "pay check" ready for me and I'll be snail mailing JtC some very grateful moolah.
"Love One Another" ~ George Harrison
Have a great trip DJ!
Don't let the volcano blow while you're there!
[video:https://www.youtube.com/watch?v=d8RnhHMiXMU]
“Until justice rolls down like water and righteousness like a mighty stream.”
My volcanic lair, and sharks with frikken lasers on their heads
We had to evacuate Mt. St. Helens when I was a child. I think my family can kiss my ass for making me camp in a caldera. Also it means I have ginormous cajones for doing so
But we love this place. Went there two times last summer. But it is kinda skeery when you stop and think about it... so we try not to think 
Paulina Lake in the Newberry Volcanic Monument - it's amaze balls
"Love One Another" ~ George Harrison
Have fun DJ and fam!
Hey! my dear friends or soon-to-be's, JtC could use the donations to keep this site functioning for those of us who can still see the life preserver or flotsam in the water.
Good Morning, DJ!
I hope you have a wonderful time on your kayaking trip. Stay safe and enjoy your time away. We will be here for you when you get back.
Do I hear the sound of guillotines being constructed?
“Those who make peaceful revolution impossible will make violent revolution inevitable." ~ President John F. Kennedy
Whoa, please please, where? Inquiring minds want to know.
We love flatwater kayaking. Is it Crater Lake? Nicaragua?
Seriously, have a great time!
A truth of the nuclear age/climate change: we can no longer have endless war and survive on this planet. Oh sh*t.
Paulina Lake in OR
Newberry National Volcanic Monument. There's two lakes, Paulina and East, in the caldera.
"Love One Another" ~ George Harrison
Sounds like heaven, DJ.
Don't know if Raggedy Andy and I will be able to get away this summer. I'm so jealous of joe shikspak's trip - looks like so much fun!!! Raggedy Andy and I used to take our grandkids to Cape Cod when they were small. We kayaked in the bay and had so much fun! I miss those days.
"The “jumpers” reminded us that one day we will all face only one choice and that is how we will die, not how we will live." Chris Hedges on 9/11
Good morning 99%er's.
Thanks GG I'm enjoying this series. Maybe enjoying is the wrong word given the subject matter. It's amazing to me that so many people not only accept this state of affairs but in many cases believe that neoliberalism/globalism is a good thing. It's inevitable and irreversible as it's the natural order of humans. Endless growth and endless war. Capitalism on steroids gets tied to freedom. "There is no such thing as a free lunch." People just want free stuff. How did we get to the point?
The common good of people has been replaced with a global order that's sole purpose is keeping the giant entities profitable. ROI. It really seems ass backwards to me as the whole point of this viscous economic system is anti- humanistic and destructive to both society and the planet. I remember George the First saying we were an ownership society. It now seems that humans are not allowed to own anything including the means to feed themselves unless it feeds the beast of unfettered global capitalism.
I've been planting a vegetable garden. I'm finding it connects me with nature and my community/neighborhood. I have been mainly working in the evenings as it's cooler then. Last night I socialized with my neighbors on the sidewalk. We talked fruit trees and that evolved into communities/neighborhoods being destroyed by investment, developers and real estate. I was surprised that all of us were aware and alarmed about what's happening to this city and yet none of us had a solution to this destruction our community. We ranged in age from early 30's old to 70's. It was hopeful and yet it's really clear that the people who live here have no say in matters of the public good. community is another threat to profit and growth. I think I'm going to go to the next neighborhood association meeting. Might not do any good but who knows. Perhaps 'the owners of the place' really have gone too far for even relatively comfortable middle class people to accept.
I call it channeling their inner Hillary
We've seen all this squared this election season as Hillary supporters can see, hear, speak, or smell no evil done by she who would be queen:
What happened to the Party of the People? (well, you've been answering that question in your fine series)
'What we are left with is an agency mandated to ensure transparency and disclosure that is actually working to keep the public in the dark' - Ann M. Ravel, former FEC member