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 TAXATION BY ANOTHER NAME: OUR DEVOTION TO PRIVATIZATION WILL COST US
 
[https://portside.org/2018-02-06/taxation-another-name-our-devotion-privatization-will-cost-us]


 

 John Atcheson 
 February 4, 2018
Common Dreams
[https://www.commondreams.org/views/2018/02/04/taxation-another-name-our-devotion-privatization-will-cost-us]


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 _ In the end, Trump’s infrastructure plan is simply another in the
long line of policies designed to benefit the private sector, and keep
the public sector sufficiently small and ineffective that it can be
controlled and contained by plutocrats. _ 

 Smith Aerial, In Florida, investors get guaranteed payments for
privatized highways while taxpayers get stuck with the bill if revenue
falls short. 

 

Trump used the State of the Union address last week to ballyhoo his
infrastructure initiative, and folks jumped all over it, and rightly
so.

What the critics are missing is that all the problems they identify
with the infrastructure plan, are just specific examples of what’s
wrong with the small-government/market-friendly policies embraced by
both major parties.

Ever since St. Ronnie Reagan declared that government was the problem
not the solution, Republicans have been gutting government like it was
a fresh-caught fish. But the DLC Democrats – now the neoliberal
elitists – essentially embraced the same general philosophy, even if
they didn’t carry it to the same lunatic extremes as Republicans. 
Remember, it was Clinton who declared the end of the era of big
government, deregulated Wall Street and the big banks, cut welfare,
forged corporate-friendly trade agreements, and turned the media over
to the likes of Fox and Clear channel by neutering the FCC.

The justification for all this was that business could and would
perform functions more cheaply and more efficiently than government,
and that unshackling it from regulations was the engine of economic
growth.

It’s worth taking a look at the specifics of how Trump’s
infrastructure plan would fail to deliver to see how and why this
whole approach is symptomatic of what’s wrong with the
neoliberal/conservative assumptions underlying our perceptions on the
role of government in society.

The big idea in Trump’s plan—one championed by Democrats in other
contexts—is to use a small amount of federal money to attract other
capital, mostly from the private sector.  For example, Trump claims
his plan would use $200 billion in federal money to put some $1.5
trillion into new infrastructure projects.

There are three big problems with the scheme.

First, private interests will only invest in the kinds of
infrastructure which provide a profitable return.  That’s why toll
highways, parking meter administration, private prisons and such are
so popular with the private sector.

Second, we pay for their profits.  Government may “save” money,
but you and I won’t. For example, tolls doubled
[http://www.chicagotribune.com/news/opinion/commentary/ct-infrastructure-privatize-tolls-fees-costs-perspec-0613-md-20170612-story.html]
on the Indiana Toll Road the day after government subsidies ended and
the concessionaire began “extracting the full cost from travelers”
as the _Chicago Tribune_ put it.  As a result, too often, services
which had been available to all when funded with tax dollars, become
available only to those with enough money to pay out of pocket. 

It turns out that privatizing public functions, over time, almost
always costs more on net.  In a study examining the costs of
privatizing government functions, the Project on Government Oversight
(POGO) found that it cost more to contract out functions in
thirty-three out of the thirty-five job classifications they examined
than it would to keep them in government. On net, POGO found
[http://pogoblog.typepad.com/pogo/2011/09/by-dana-liebelson-the-us-governments-increasing-reliance-on-contractors-to-do-work-traditionally-done-by-federal-empl.html]
that contracting out services to the private sector cost twice as much
as doing the function in-house with government workers.

In short, you can pay relatively less taxes to have a function done or
managed by government—an entity that is answerable to you at every
election; or more to have it overseen and performed by a private
entity who is likely to do a poorer job, one that isn’t answerable
to you. You’re paying “taxes” either way.  Government taxes are
simply more transparent, less costly, and more accountable than the
“taxes” you pay to private entities.

Finally, the private sector will determine which projects get funded,
and which don’t. That means the most profitable venture is likely to
be the one to get done, not the most needed.  It also skews public
policy from ventures which don’t offer a clear opportunity for
profit, or investments that are inherently less profitable—things
like storm drains, flood control projects, or bridges on less
travelled roads.

This last issue is a big deal.  We the people won’t get to set the
public agenda.  In essence, we will be accepting a measure of
corporate tyranny in exchange for … well … not much.  Certainly,
no net savings, and certainly not a better infrastructure.  In fact,
we may end up paying more for the wrong infrastructure investments.

Again, Chicago’s experience with privatizing the administration of
parking meters provides an example.  As the _Huffington Post_ noted
[https://www.huffingtonpost.com/2009/06/23/city-leased-the-streets-a_n_219590.html],
a report found that the agreement with the private entity running the
parking meters completely compromised the city’s ability to do
comprehensive transportation planning.  Virtually anything which
might decrease traffic was essentially off the table for planners
trying to manage traffic and congestion.

But none of this is unique to infrastructure. As POGO found, most
services are performed better by public entities than private ones;
most private interests don’t do an effective job at representing
public interests.

Remember, Medicare and Medicaid—with administrative costs of
approximately 2%—provide better health outcomes and higher customer
satisfaction rates than private insurance does with administrative
costs that average more than 7 times as much.

Countries that tried to privatize Social Security-like functions such
as Chile, found that overhead costs were more than four times as high,
and customer satisfaction was low. In fact, the system collapsed.

So when the Republicans try to privatize these functions, hold onto
your wallet.  Your taxes might go down a tad, but your net
out-of-pocket expenses will skyrocket, as once again, the private
sector extorts more money for less service.

"There’s a link between why we have an idiot in the White House, and
the fact that both parties have given up on government and embraced
the private sector."

In the end, Trump’s infrastructure plan is simply another in the
long line of policies designed to benefit the private sector, and keep
the public sector sufficiently small and ineffective that it can be
controlled and contained by plutocrats.

Now, there’s a link between why we have an idiot in the White House,
and the fact that both parties have given up on government and
embraced the private sector.  People understand at a very basic level
that we need an effective government, and that many roles are
performed best by government.  They know that corporations and the
rich have taken over government and used that power to feather their
own nests.

They also know that neither party is willing to stand up to the
Oligarchs and Plutocrats that control government today.  The
Republican’s enslavement to corporations and the uber rich is on
full display—obvious enough that only a little over 27 percent of
eligible voters backed Trump.

But the Democrat’s embrace of the Oligarchy is a little less
transparent.  For example, in 2016 Hillary Clinton claimed to take
climate science seriously—which would mean leaving 80% of the fossil
fuels we’ve already found in the ground to have a ghost of a chance
at avoiding catastrophe—but she backed industry fracking
initiatives, backed the XL pipeline, and advocated oil exploration for
new fossil fuels on federal lands.

This kind of duplicity is emblematic of neoliberal Democrats, and
it’s this kind of chicanery made enough voters choose to stay home
or simply not to vote for the Democratic candidate that Trump was able
to win with about 27 per cent of the rabid, angry and deluded.  A
study of voting in 33 states  found that 1.7 million voters
[https://www.commondreams.org/views/2017/12/29/year-will-live-ignominy] who
did turn out, voted for down ballot candidates but  simply refused to
vote for President.

And that is why the 27 percent of the voters who are passionately
ignorant could put an ignoramus in the White House.

If Democrats want to win, they will have to embrace a new New Deal.
One rooted in progressive values and a willingness to divorce
themselves from the Oligarchy and embrace the power of the government
to do good.  In Virginia—a southern state—where Democrats ran a
slate of candidates whose progressivism went beyond rhetoric,
Democrats kicked butt. 

It’s time to put this worship of and enslavement to the private
sector to rest. It’s not only a bad idea for infrastructure, it is:
a bad way to govern; causing us to pollute ourselves to near death;
making us fight endless wars with no real rational; and shredding the
principals our Constitution was founded upon.

Oh yeah, it will also cost us a lot of money.

This work is licensed under a Creative Commons Attribution-Share Alike
3.0 License 

JOHN ATCHESON [https://www.commondreams.org/author/john-atcheson] is
author of the novel, _A Being Darkly Wise
[http://www.amazon.com/A-Being-Darkly-Wise-ebook/dp/B006ZGQE8U]_, and
he has just completed a book on the 2016 elections titled, _WTF,
America? How the US Went Off the Rails and How to Get It Back On Track
[https://www.amazon.com/s/ref=nb_sb_noss?url=search-alias%3Daps&field-keywords=WTF+America+How+the+US+Went+Off+the+Rails+and+How+to+Get+It+Back+on+Track]_,
available from Amazon. Follow him on Twitter @john_atcheson
[https://twitter.com/john_atcheson]

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