Eli5: How does privatization of an essential public good/service/infrastructure work and what are the reasons behind it?

712 views

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?

In: 142

25 Answers

Anonymous 0 Comments

MPA here. The short version is that it saves money, at least in the short term, both by reducing the public infrastructure support needed to run it, as well as (theoretically) incentivizing the private entity to do a good job or get replaced.

And all of those qualifier words are necessary because it often works as well as communism in practice: the humans involved *will* fuck it up. Knowing this, why does it keep happening?

The other part that the general public either doesn’t know or refuses to acknowledge is that there’s often not really a choice. Most districts (since cities tend to consolidate these days, also to save money) are broke. They couldn’t possibly pay salaries and states are heavily pressuring them to keep as few people on public payrolls as possible because of the clusterfuck that lifetime pensions are causing after retirement. They’re bonded out so far that they don’t even know what their budget is going to be when they *start* paying down the bonds.

So, yeah: if you don’t like it, pay more taxes and make sure those taxes go toward whatever service you want to keep public (good luck with that). There’s really no other fix.

You are viewing 1 out of 25 answers, click here to view all answers.