From what ive read, consumers are definitely not the beneficiaries in such arrangements. Why do governments do this then? Why give up ownership and control of vital stuff (e.g. water, utilities, highways, etc.) to private – and often – foreign entities?
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The main reason behind it is money. But not as a cost saving measure as it’s sold to the public.
A politician has donors. Donors are rich and own companies. Companies that can be used to gain contracts of govt services. So that donor hires a lobbyist, the lobbyist hires a think tank to make up some reasons why a particular service should be privatized that includes massive cost savings to the govt. The lobbyist hands that report to the politician with a wink and a nudge and promises to get him re-elected. The politician shows his or hers party and they all salivate over the “savings” (donations), and start to push for it. Constantly blaming govt for its inherent failures in the process.
If it finally gets privatized, pockets are lined, the donors stock portfolio takes a massive jump, and everyone pats each other on the back imagining how much money the tax payers will save with the new streamlined services.
Eventually, in the name of profits, because corporations care about profits, not services, the quality of the privatized service starts to diminish. Interestingly though, the politicians don’t complain about the inefficient contractors. Instead they stay quiet. Eventually the service is purchased by a new corporation that now must recover the costs incurred by the purchase, so even worse services.
Eventually people start to question the privatized services because it’s no longer what it once was, and the govt buys back the services from the corporation and funds the services with tax dollars.
It’s a basic corporate money grift straight from taxpayers pockets. Kind of like that scene in Goodfellas where the mob forces a restaurant owner to hand over the keys to his establishment because they’ve bled him dry, and then the mob burns it down for insurance money. Except in this case it can’t be burned down, and now it’s a taxpayer burden with much higher overhead than it ever was before it was privatized.
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