The public cost of privatization

By Susan Jhirad

The Boston Globe |

December 3, 2004

http://www.boston.com/news/globe/editorial_opinion/oped/articles/2004/12/03/the_public_cost_of_privatization?mode=PF

AS BIG DIG holes leak taxpayer dollars by the gallon,

as Halliburton overbills the Pentagon by millions, as

Enron CEOs go to jail for defrauding stockholders, and

as HMOs provide less and less health care for higher

and higher fees, it is time to reexamine that great

myth spawned by the Reagan revolution: the myth of

privatization.

For too long, Republicans have been able to promote,

unchallenged, the notion that the private sector can

deliver goods and even public services more

efficiently, more cheaply, and better.

"Privatization" has meant a variety of things: from

giving corporations taxpayer money with little

government oversight, as in the Big Dig, to turning

public schools into for-profit charters, to forcing

community colleges like my own to rely less on state

funding and more on private fund-raising, including

raising student fees in order to survive. Whatever its

form, privatization is based on the general concept

that business is good, government is bad.

In the presidential debates, George W. Bush was proud

to claim (falsely) that Senator John Kerry wanted to

impose "another big government healthcare program, like

in France or Canada." Never mind that countries with

national health plans like Canada, France, and England,

wouldn't dream of trading their free universal

coverage, with all its imperfections, for our system,

where millions lack any healthcare at all.

Never mind that Social Security is actually solvent and

supporting millions of Americans. Since President Bush

is now recommending that we privatize Social Security,

we need to be clear on the realities. Although it faces

challenges from the baby boomer generation, Social

Security has always been self-sustaining and has

actually been tapped as a source of revenue for other

government programs.

Never mind that my own community college, even with

slashed funding, manages to provide a quality

education, raise money, and stay within budget. Never

mind a recent federal study showing that in Texas, 98

percent of the public schools met state performance

standards while only 66 percent of charter schools did.

"Privatization" is ideology, not fact.

Consider the Big Dig as a poster child for what happens

when "big government" steps aside. Years ago, when it

was reported that Bechtel/Parsons Brinckerhoff both

executed and monitored the preliminary design of the

Big Dig, my alarm bells rang. With little interest in

reining in costs, the price of the Big Dig escalated by

billions, creating the greatest overruns in the history

of US public works. Now we hear that the project itself

may be seriously flawed.

How did this occur? There may be blame enough to go

around, but let us remember, a series of Republican

governors -- Weld, Cellucci, and Swift, all firm

believers in privatization -- allowed Bechtel to run

its own show. When two members of the Massachusetts

Turnpike Authority, Jordan Levy and Christy Mihos,

protested, Governor Swift moved to fire them.

In short, the Big Dig is a classic example of private

corporations abusing public funds for private profit.

This occurs all the time with military procurement. Yet

now, when politicians choose to vote against overpriced

military equipment or the faulty missile defense

program, they are branded as antidefense or even

unpatriotic.

We are now facing the largest deficit in our nation's

history, in part driven by tax cuts, in part by the

open-ended war in Iraq. Large corporations like Bechtel

are grabbing a "piece of the pie" in what will be a

protracted, expensive task of reconstructing a country

we are spending billions to bomb. Meanwhile, our

president warns that Social Security is in trouble, and

we need to "reform" it.

But in all these matters, who will pay and who will

profit? Does privatization really deliver better goods

and services at lower cost, or does it just transfer

public wealth into private pockets? Are we gradually

eliminating all public services, replacing them with a

system of pay-as-you-go benefits that serve only the

wealthy?

Although America is a capitalist country, we have

accepted, since the New Deal and even before,

government's role in reining in corporate excess and

taking care of the needy. Most Americans believe that

Social Security, unemployment insurance, Medicare, and

child labor laws are beneficial, although all were

instituted against the opposition of big business. Now

the Bush administration, closely allied with major oil,

defense, and drug companies and with control of

Congress, appears bent on privatizing the entire

country. We can only wonder, what will happen to us

then?

Susan Jhirad is chairwoman of the English Department at

North Shore Community College.

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