Privatization, Non-Profits, and Disinheriting the Public

26 06 2012

Privatization has been accelerating at break-neck speed (and in ludicrous ways) the last thirty years or so, in part because of the decline in government revenues and the general growth of the neoliberal consensus that assumes the profit motive brings with it ideal efficiency. It is also an efficient means of weakening the labor movement, because employees of a government contractor are covered by a different, considerably weaker, set of labor laws than employees of a state actor.

But privatization isn’t new; in fact, privatization of public services was quite common back in the day, and by back in the day I mean ancient Rome.

The late Roman Republic grew quickly as a result of conquests and voluntary ceding. There was no time to inculcate Roman civic values and grow the necessary institutions to ensure administration along Roman lines. Instead, what the Roman Senate, Consuls, and other governing bodies did to guarantee the provisioning of necessary public services and the gathering of taxes was to contract powerful local men, called Publicans, to provide these services and gather these taxes.

The Publicans in turn grew immensely wealthy with these government contracts, and thus were able to flex significant political muscle in Rome itself, through the buying of tribal leaders in elections and the funding of foreign adventures for ambitious soldiers and politicians. It was a textbook rent-seeking loop.

The privatization craze may be leading to similar results in the U.S. (hopefully without the foreign adventures, although, you know; military-industrial complex). Stories have been popping up with increasing frequency indicating that privatizing the provisioning of public goods is creating wealth, but not, you know, provisioning public goods any more efficiently.

First, here’s Paul Krugman on the privatization of the prison industry–he touches on several of the key points, so I’m quoting at length:
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The Error of an Era: The End of Elections

8 06 2012

The failure of Tom Barrett to beat Scott Walker in Tuesday’s recall election was probably about a lot of things. For social historians of this era, though, it will be this: a miscalculation of epic proportions, an error that defines the post-Citizens United era.

The public rage after Governor Walker instituted his de facto recission of public workers’ collective bargaining rights was palpable and widespread. It was by no means universal, but it brought together lots of people who felt targeted, misled, and who saw the legislation as an existential threat to their economic security and well-being. Wisconsin’s public sector after all is storied–Wisconsin passed the country’s first public worker collective bargaining law–and public sector workers in that state came from all partisan stripes and economic classes.

The direct action that resulted, occupation of the capitol building, was a reasonable response. The decision to turn all of that activist energy into an election campaign was fatally misguided.

I argued, on the heels of the Citizens United decision, that the left could finally admit that elections are not a feasible method of obtaining particularly economic goals, and that it should begin exploring alternative, direct action methods; particularly, occupations, work stoppages, and boycotts:

With the electoral process eliminated as a viable strategy, resources can finally be diverted to organizing at the community and workplace level. All this decision does is remind us that a small number of corporations–by no means corporations generally–have accumulated much too much power and wealth.

On the single issue of collective bargaining rights, hundreds of thousands of Wisconsinites were united on an activist level. Millions more agreed in spirit, if not enough to take any sort of direct action. The conditions were ripe for some kind of direct action that would have forced the government’s hand–a work stoppage, boycotts of public services, occupations of facilities. The millions of dollars and the thousands of hours of activist energy spent on an election campaign, if diverted to direct action, could not only have ground the machinery of the state to a halt, but would also have created a well-organized, on-the-ground organization of activists who have worked together, fought together, and developed invaluable social relationships. The attendant electoral advantage would have expressed itself naturally in November and again in subsequent elections.

Elections are no longer a fruitful means for progressive change. Citizens United cemented in fact something that was already more or less true: the wealthy, both corporations and individuals, have an outsize influence on elections that is nearly impossible to overcome. President Obama’s 2008 election campaign, soaked as it was in Wall Street cash, was not an exception to this fact but an expression of it. Public intellectuals and activists who advocate for elections as a way to achieve any fundamental reform are wrong in every instance. Increasingly, their only arguments will be negative ones–“The other side is worse”–and, with each passing election, we’ll see that even where elections are won, the power of the ultra-wealthy will be such that public relations campaigns and lobbying smother legislative initiatives in the crib.

Corporate power has purchased the electoral process. Pouring any more money and energy into it is not worthwhile at all. It’s over. Volunteering for or giving money to an election campaign is a waste of that time and money in every instance. Debate and discussion about the variable merits of candidates, the positioning of candidates on issues, fundraising, relative strength in different states and among different demographics, is not a serious use of anybody’s time or intellect.

For the foreseeable future, in other words, electioneering and election work–fundraising, door-knocking, blogging, running for office, whatever it is–is in no way progressive or left wing, in each and every instance. To the contrary; it’s essentially the political equivalent of playing the lottery, a habitual distraction predicated on infinitesimally small chances of achieving anything, and in that way it diverts resources from real change and is inherently conservative, biased towards the status quo.

Wealth, or capital, engages in direct action all the time: capital flight and strike threats are the basis for almost every piece of nasty legislation, and every corporate welfare or tax giveback, that state, local, and the federal government have passed for years. All the talk about “increasing confidence” for “job creators,” is a different way of saying appeasing striking capital. It’s the direct action that makes the change. The left for some reason has become hypnotized by chimera of electoral change, and we see the result: even when the left wins an election, they can achieve little, rebalance power not at all, and income inequality and debt peonage grows and grows.

Gas and Cigarettes and Addiction Funding

25 05 2012

So here’s an interesting problem for students of how cities operate.

Public health and public transportation are two of the marquee issues for planners, and they’re intertwined. Land use planners have recently turned towards policies that encourage walkability, bikeability, and “transit-oriented development.” Mayor Emanuel’s administration is currently undertaking an impressive, ambitious plan to introduce more than 100 miles of protected bike lanes, of the type found on Kinzie Avenue between Jefferson and Wells. Decreasing reliance on cars is a public health issue because it makes it easier for people to be active, and decreases vehicle emissions that pedestrians encounter as they move around the city. Similarly, the Affordable Care Act had provisions for public/private community health facilities with a focus on patient outcomes rather than fee-for-service models that merely encourage remedial care.

Two of the main sources of funding for public transportation and public health (particularly as the latter is undergirded by state Medicaid) are gasoline and cigarette taxes, respectively. You can see the immediate problem; the better transportation and health systems are designed, the more they must compromise the source of their funding. With transportation, this creates the most immediate problem: with increased volatility of gasoline taxes and a sharp increase in ridership, ill-equipped public transportation systems need more and more money to handle the increase (the fares are never enough to capitalize increased infrastructural capacity).

A brief by the American Public Transportation Association touches on this problem; as public transportation ridership increases, capacity needs increase even while revenues drop. Because fares will never be sufficient for real expansion of capacity, there’s a systemic knot that can’t be untied without a federal-state-local approach to overhauling the funding system.

Obviously, there’s a similar problem with the vice-and-obesity taxes on things like cigarettes, alcohol, and fast and junk food. Where these revenues are meant to fund necessities–community health care in particular–the fact that the tax exists as a “disincentive” to unhealthy decision making implies the outcomes we want–healthier city living–are not really priorities. The addiction persists.

The Domestic Infection of Empire

27 03 2012

“Our security will require…being ready to strike at a moment’s notice in any dark corner…and our security will require all Americans to be forward-looking and resolute, to be ready for preemptive action when necessary to defend our liberty and to defend our lives…”

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