12-31-2016, 12:06 PM
(12-31-2016, 04:11 AM)Galen Wrote:(12-30-2016, 05:45 PM)Warren Dew Wrote:(12-30-2016, 02:32 PM)TeacherinExile Wrote: The ideological support for privatization rests largely on the specious premise that the "market knows best." But we now have much evidence to the contrary when it comes to introducing a profit motive into the delivery of common goods: education, utilities, national defense, and so on. Think of the bankruptcies of not a few for-profit charter schools and universities; think of the tainted water (lead)scandal in Flint, MI.
That bad private schools go bankrupt rather than sticking around and miseducating more kids as bad public schools do is a good thing, not a bad thing, and illustrates exactly why education is an area where the market would work better. The Flint water supply was also publicly run; privatization couldn't have made things worse there, and might have made them better.
This is the primary advantage of the market over the state. What the state tends to do is indefinitely subsidize failure.
What examples of subsidizing "failures" can you cite? Do we presume that you're referring only to government expenditures on the common welfare? Let me cite a few in the private sphere that could clearly be labeled failures. How about we start with the most obvious one: the bailouts that followed the financial crash of 2008--Chase, Citigroup, Goldman Sachs, Morgan Stanley, GM, private enterprises all, which according to the strict dictates of the "free market" should have been allowed to fail. Shouldn't the years-long quantitative easing (QE) and zero-interest-rate policy (ZIRP) of the Federal Reserve be considered a subsidy as well? ZIRP allowed the very financial institutions that caused the crash in the first place to borrow funds at virtually no cost and loan them back to the federal government by buying risk-free Treasuries. Interest arbitrage, a sweet deal indeed. And aren't the taxpayers paying a subsidy of sorts to defense contractors like Lockheed, whose "yuge" cost overruns on the F-35 we're all paying for? Many programs and institutions that serve the public--Medicare, USPS, Amtrak--were never intended to make a profit in the first place. In the case of Medicare, it's way more efficient in delivering health care with its much lower administrative overhead than the private health insurance industry as a whole.