Privatization Sucks

Financial Justice Ideas and Issues Wade's World

New Orleans      The problem Donald Cohen and Allen Mikaelian faced in writing a book about privatization became obvious as I read it.  Once you start listing the ways that private companies have ripped and run through the US public sector purse and services, where do you stop?  The stories and cases in point are endless.  How could they get all of the horror in between the covers on one volume?

In their new book, The Privatization of Everything:  How The Plunder of Public Goods Transformed American and How We Can Fight Back, they addressed the problem by organizing the rip-offs into big buckets like public health, transportation, public safety, the social safety net, public institutions, education, science, and research.  Sadly, if they had the time or energy or thought the reader could bear the weight, they could have kept going endlessly.  One story led to another; one scandal was topped in another city and state, as the torrent of terrible tales just kept exploding from page to page.

I’ve known Cohen for some years, though it had been a minute since we first met.  I had first met him in San Diego decades ago when In The Public Interest was a smaller outfit, and we were first breaking ground to organize there in a partnership between ACORN and Gamaliel to see what might happen if we could combine organizing models collaboratively.  Cohen had done some great research on living wages and other issues, including the threats of privatization to public sector jobs, and we were introduced by the head of the SEIU local at the time, which had recently merged with several employee associations with other workers.  Now, the organization says it is housed in Oakland, Cohen works out of Los Angeles, and one of the great ACORN organizers, Claire Crawford is still based in San Diego and another ACORN stalwart is the political director of that same SEIU local.  Small world, great work!

All of this made it fun to talk to Cohen on Wade’s WorldThe heart of Cohen’s argument is that there is essentially no way that turning over public goods, the heart of governmental services, to private actors and corporations is ever going to end well because by definition they are unelected and therefore unaccountable to the very public the services were designed to benefit.  As I warned, the examples are abundant of how the private sector promises there will be no harm, no foul, and no cost to the public, and then, later, hands them the true bill.   In so-called public-private partnerships, which almost all mayors and governors tout, the public too often is the mark and eventual loser.

There’s no worse example than the Chicago parking meter scandal.  Desperate for cash, Chicago worked an upfront payment on a long-term contract to allow a private operation to run its meters and collect the bulk of the cash.  In the bamboozle, the city guaranteed the new operator a level of profit and repayment for lost revenue.  You can see where this going, right?  When they tried to create bike lanes, that meant paying the company.  When they repaved streets, that meant paying the company.  In essence, wherever there had been meters, the private company had usurped Chicago’s ability to make traffic and transportation policy without paying the piper, so they were stuck and ripped raw.

Cohen argues there’s a way to fight back and win, but as too many of us know, we are fighting twin demons.  On one hand, conservatives that want to starve public goods and the government and ideologically believe private is always better than public.  On the other hand, already starving and unwilling, or unable, to make the case to citizens under economic pressure to pay for public goods, too many elected officials are led into these choices between the devil and the deep blue sea.

Nonetheless, Cohen’s book and their nonprofit organization, are key allies on this battlefield, and help all of us to stay “in it to win it!”