One of the most overlooked aspects of the Enron scandal has been the continued failure of the ideology of privatization. Since the rise of Reaganomics, conservative planners have sought to privatize just about everything that the government provides for its citizens, everything from schools to prisons to electricity, even water.
Enron is perhaps the most visible example of the mistaken ideology which holds that private, for-profit business can provide public services for absolutely everything better than government can. After opening California's electric grid to private business, the results were not lower rates and better service, but rather skyrocketing rates and rolling blackouts. In dramatic fashion, California discovered what happens when public accountability is replaced with unbridled private profit motive.
The LA Times ran a feature story over the weekend about the failure of for-profit water companies servicing California communities. Since privatization of water services, Californians have been dealing with unsafe drinking water and outrageous rate hikes of more than 1,000% (yes, one thousand percent).
Most Californians are well aware of the debate over voucher programs and charter schools. S chool maintenance, transportation, and school food services have been outsourced to for-profit companies in yet another example of privatization's growing reach. The for-profits suggest that the free market can provide education better than public schools. Of course, in free markets, there are necessarily winners and losers. And in California, we cannot leave any child in a failing school.
As we move ahead, progress requires looking long and hard at people who tell us that privatization is a panacea for all the problems with public services. When the Republicans tried to privatize Social Security, the nation spoke out and cried foul. This was the beginning of the end for the privatizers. While public providers of services can have problems, they pale in comparison to the problems caused by Enron and their for-profit ilk. A better solution involves taking policy makers to task and getting real, publically accountable solutions. Privatization cannot always be the best way to acheive our dreams.
UPDATE: 6/1 2:47PM
This just in. Even the government's effort to collect taxes is undergoing some privatization -- IRS recordkeeping has just gone to the lowest bidder.
From the Courage Campaign.
I'd just like to make a point about the wording used in the update. The IRS is contracting out part of their officekeeping to the "lowest bidder". Frankly I am suprised this needed to even be mentioned. What other bidder are they going to use? The highest bidder? I sure don't buy the most expensive pizza at the store, I buy the lowest cost pizza that meets my standards. Frankly the worst thing about this story is that the IRS may well end up being a more efficient tool of political oppression than it has been in the past.
Thane, thanks for your important comment.
I think that the point you raise, however, is a bit of a quibble. The government should probably not contract out or privatize the business of the IRS in the first place. And the bidding process wherein the lowest bidder gets the job often causes all kinds of quality problems whenever the cost of business is a bigger concern than quality of the job -- as it appears in this case.
I reject the notion that the lowest bidder is necessarily any more effecient than a government operation, but you're right in that the IRS will continue to be a tool of oppression for sure.
Thanks again and welcome to the blog, Thane.