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Privatized Hell
June 28, 2003
By Ernest Partridge, The Crisis Papers

In colonial Philadelphia, firefighters were employed by private insurance companies which, of course, had financial incentives to minimize damage to their clients' properties. Plaques with the insurance company's insignia were placed on buildings, so that the fire fighters would know whether or not it was their business to put out the fires on the premises. (These plaques are often found today in antique shops). If the wrong plaque was on the building, well, that was just tough luck. Of course, with their attention confined to a single building, fire fighters were ill-disposed to prevent a spreading of the fire to adjacent non-client structures.

Occasionally, when the building's insurance affiliation was in some doubt, competing fire companies would fight each other for the privilege of putting out the fire, resulting in more water aimed at fire fighters than at burning buildings.

Eventually, the absurdity and outright danger of this system led one prominent Philadelphia citizen to come up with the idea of a publicly funded and administered fire department.

His name was Benjamin Franklin: America's first anti-free-enterprise commie pinko nut-case.

Franklin's subversive left-wing ideas were extended to include libraries, post offices, and public schools, and, if we are to believe some of today's self-described "conservatives," [Note 1] it's been downhill ever since.

These conservatives contend that virtually all economic and social institutions are better managed when privatized and unregulated. According to this libertarian theory, the greed (i.e., profit motive) of investing private individuals is, in virtually all cases, mystically transformed into the optimum public good. The exceptions are the police, the military, the courts and the legislatures which, they concede, are properly confined to the public sector [Note 2].

However, today even these exceptions are succumbing to creeping privatization, as the hyphen in military-industrial complex erodes, as members of Congress are clearly more beholden to their corporate sponsors ("contributors") than to their constituents, and as conservative judges routinely rule that corporate property rights trump personal injury suits and civil liberties. Critics such as William Greider charge that the Bush Administration and the Republican Congress wish to take America back to the days of William McKinley. It appears that they have miscalculated by more than a century. Instead, it seems that the right-wing ideologues in charge of our government want to take us back to the days before Benjamin Franklin. (As an added bonus, this would be before the American Revolution, and those troublesome documents, the Declaration of Independence, the Constitution, and the Bill of Rights.) So now that Ben Franklin's socialist dispositions have come to light, surely Tom Delay will propose that William McKinley's image replace that of Franklin on the $50 bill.

But is it just possible that old Ben Franklin had a point? Are we not all better off now that the fire department doesn't first look for the insurance medallion on our homes before they turn on the hoses? Isn't the function of the military to defend the country - all of us, rich and poor, male and female, white and "other" - from foreign enemies, rather than enrich the industries that supply the armed forces? And shouldn't the members of Congress represent the public at large, and not the private corporations and individuals that finance their campaigns?

The issue turns on the question of whether or not there are such things as "public goods" - in fact, on whether there is such a thing as a "public" (or society) at all. Dame Margaret Thatcher, Ronnie Reagan's favorite Brit, apparently didn't think so when she famously wrote "There is no such thing as society, there are only individuals and families." (Thatcher)

As noted above, fire protection is clearly a public good, since fires are without conscience and completely oblivious to the concept of property or property boundaries.

As further evidence of the existence of public goods and (contra Thatcher) society, consider a parable.

Two communities are situated on opposite banks of a great river: on the right bank is "Randville," and on the left bank is "Rawlsburg." Randville is populated entirely by libertarians - rugged individualists all, who shun collective activity and who assume full responsibility for their personal safety, welfare and property. Rawlsburg is comprised of individuals who are properly covetous of their personal rights, yet fully aware of the desirability of promoting public goods and of acting collectively in the face of common emergencies.

News arrives at both communities from (gulp!) a government bureau, that a great flood is approaching from upstream. The citizens of Randville immediately get to work piling sandbags around each of their individual dwellings. Across the river in Rawlsburg, brigades of citizens are hard at work building a levee around the entire town.

Come the flood, the puny separate efforts of the rugged Randville individualists prove to be futile, while the substantial communal levee surrounding Rawlsburg holds firm and the community is spared.

"Now hold on!," the libertarian retorts. "Surely, faced with this common emergency, the folks at Randville would volunteer to build a levee. That's just common sense."

Very well, but what about those Randvillians who say: "you guys go right ahead and build that levee. I'd rather stay at home - I have other priorities." Surely the good libertarians wouldn't want to force anyone to contribute to the common defense?

And so we have the well-known "free rider problem," whereby an individual gains unearned and cost-free advantage from the labor of others. A profound injustice on the face of it. The solution? What else than to coerce a contribution to the common effort, either by labor or, failing that, cash assessments.

In other words, taxes.

So it comes to this: The only way for the Randvillians to deal with the free riders is to coerce labor on the levees, or assess taxes in lieu of labor. They must do so in behalf (are you ready for this?) of the "common good" of the community-as-a-whole. Just as the Rawlsburgers are doing across the river.

The free rider problem exemplifies a larger conundrum, well-known to political philosophers back to Aristotle (and presumably beyond): the tragedy of the commons - famously reiterated by Garrett Hardin. Here is how the tragedy plays out: in numerous cases, an aggregate of individuals who rationally seek advantage for themselves, bring ruin upon all. Hardin's example was of an overstocked pasture, the productivity of which is destroyed as each private farmer attempts to increase his personal wealth by adding livestock to the pasture. Substitute the common atmosphere, or fish stocks in the common ocean, and you have a similar situation. Or consider antibiotics. The overuse thereof is commonly known to decrease their potency. Yet it is clearly to my advantage to take antibiotics for even a trivial bronchial infection - good for me, but minimally bad for everyone else who takes antibiotics. Multiply the separate personal advantages by millions, and eventually the antibiotic becomes effectively useless to all.

Put simply, good for each, bad for all (e.g., antibiotics) . And conversely, bad for each, good for all (e.g., taxes).

Hardin's solution (along with Aristotle, Hobbes, Rawls, and many others) is "mutual coercion, mutually agreed upon." In other words, government. And if we must have government, then by all means let it be a democratic government, under rule of law, and protective of the rights of all citizens. The sort of thing that our founding fathers had in mind when they ratified the Constitution and Bill of Rights.

To the contrary, the libertarian doctrine behind the radical right-wing declares that government is the enemy - that the free market and the self-interested use of private property will, via Adam Smith's"invisible hand, invariably result in the best result for society at large. Good for each, good for all; bad for each, bad for all.

The absurdity of uncompromising privatism and market absolutism is on full display when applied to environmental policy. The libertarian Robert J. Smith writes:

"The problems of environmental degradation, pollution, overexploitation of natural resources, and depletion of wildlife all derive from their being treated as common property resources. Whenever we find an approach to the extension of private property rights in these areas, we find superior results." (R. Smith, 42-3, my emphasis)
It thus follows that I own, not only my property, but also the atmosphere above it and the ground below it. Can I then prohibit fly-overs by aircraft? Can I sue if the inflow to the aquifer beneath me is contaminated? Who, then? Are the "owners" of the insects that pollinate my orchards entitled to charge me for the service? The mind boggles. And it gets even worse (as I elaborate in Section III of my "With Liberty for Some" ).

The privatization regime being imposed by the Bush administration is inherently unstable, unequal, and eventually oppressive. Wealth and power act in behalf of and enhance wealth and power, ever loosening the constraint of checks and balances, as it proceeds to absorb government and make it an instrument in behalf of wealth and power. The statistics tell it all: today, the average CEO of a Fortune 500 company earns in half a day, what his median worker earns in a year (a ratio of 500 to 1). Twenty years ago, the ratio was 40 to 1. Today, one percent of the US households own almost 40% of the nation's wealth - twice that of the 1970s. (United for a Fair Economy). With the coming abolition of taxes on estates, dividends and capital gains, that inequality can only accelerate, as Leona Helmsley's maxim - "taxes are for the little people" - achieves full fruition.

Furthermore, the privatizers' celebration of "competitive enterprise" is essentially hypocritical. Capitalists hate competition, as they relentless strive to build monopolies and crush their competitors. All that stands in their way are anti-trust laws and the courts - which is to say, government.

But let us stop well short of the deep end. Privatization and free enterprise, constrained by popular government, are fine ideals, the applications of which have undoubtedly yielded great benefits to mankind. Moreover, government regulation can often be excessive and a damned nuisance to the private entrepreneur. Private enterprise should surely count for something. But not for everything. Adam Smith was right: the invisible hand of the market place can, without plan or intention, "promote ... the public interest." But we put ourselves in great peril if we fail to acknowledge the back of the invisible hand - the tragedy of the commons - whereby the unregulated pursuit of self interest by the wealthy and powerful becomes parasitic upon, and eventually destroys, the well-ordered society of just laws, common consent, and an abundance of skilled and educated workers who produce and secure that wealth.

Both the radical anarchism of the Busheviks and the communism of Lenin and Stalin share the attribute of uncompromising dogmatism: in both cases, these are doctrines which are assumed, apart from experience and common sense, to apply to the real world, fully formed and fully ready to be imposed upon that reality. These are dogmas for which pragmatism and corrective feedback have no part. Both libertarianism and communism err in proposing extreme, simplistic and doctrinaire prescriptions for conditions that are necessarily complex: communism by condemning all property, and libertarians by condemning all public governmental functions, other than that of the "watchmen" (police and military) and the courts. (Cf. "Two Lessons from Russia").

The complex arena of human economic and social behavior has no place for such simplistic dogmas. Throughout our illustrious and prosperous history, the United States has developed a society and an economy that is a splendid mix of private enterprise, civic association and public service. We have learned how to progress through the trials, errors and successes of countless policy experiments, all leading to refinements and compromises amongst competing parties and interests, with the excesses of both government and private interests constrained by the rule of law and finely honed checks and balances.

Now all that is about to be thrown away. The Bush administration has no use for these complexities, caveats and constraints. They are comfortable in their assurance that they already have all the answers. All that remains is for them to serve their sponsors, and, as GOP activist Grover Norquist crudely puts it, drown the beast (namely our constitutional republic) in the bathtub.

With that demise we will see the end of Social Security, Medicare, Head Start, the Environmental Protection Agency, to just begin a recitation of a very long list. Vouchers will drain support and funding from the public schools, and the crippled social services will be forced to attach themselves to religious organizations in order to qualify for faith-based funding. The privatized replacement for the current government social services - the insurance companies, the HMOs, the private schools, etc. - will, of course, have as their prime objectives, the enrichment of their stockholders and corporate officers, rather than service to the public. And oversight and reform of these private institutions will be out of reach of political institutions: elections, legislatures, and the courts.

This will be a very different country, virtually unimaginable to most American citizens today, but familiar to those who are acquainted with third world kleptocracies in Central America, Africa and Asia.

This will be a country that the public at large will not want. But when, to their great regret and sorrow ,they discover this, it will be too late to turn back.

The founders of our republic, let us never forget, recognized the inalienable rights to life, liberty and the pursuit of happiness (rather than simple "property").. Furthermore, they acknowledged that "to secure these rights, governments are instituted among men, deriving their just powers from the consent of the governed." And among the six functions of government enumerated in the Preamble to our Constitution are, "to insure domestic tranquility" and "to promote the general welfare."

This government - our government - is what the Bush and his supporters wish to drown in a bathtub. They desire this, firm in the conviction that a disconnected aggregate of self-serving private individuals, in absolute control of their private property, will serve us better.

Are you willing to allow these radical anarchists to try out this bold experiment on the rest of us?

If not, what do you propose to do about it?


Dr. Ernest Partridge is a consultant, writer and lecturer in the field s of Environmental Ethics and Moral philosophy. He publishes the website, The Online Gadfly and co-edits the progressive website The Crisis Papers.


NOTES and REFERENCES

1. Simply put, those who call themselves "conservatives" aren't. They are in fact radical anarchists. Authentic conservatives, revere our founding documents (e.g., the Bill of Rights) and respect the rule of law. (See my "Conscience of a Conservative" )

2 The (self-described) "conservatives" thus exemplify the core libertarian doctrine that the only legitimate function of government is to protect the fundamental human rights to life, liberty, and property. Hence, the only legitimate institutions of government are the military, the police, and the courts. (Bayes, Hospers) Right wing "conservatives" thus agree with libertarian economic dogma. They disagree on matters of personal conduct such as drug use, gay rights and abortion. The right wing would "take government off our backs and put it in our bedrooms," while the libertarians would keep government both off our backs and out of our bedrooms. (For my extended critique of libertarianism, see "With Liberty for Some" . For my critique of "free market absolutism, see "The New Alchemy" and follow the links).

William W. Bayes, What is Property?, The Freeman, July 1970, p. 348.

Garrett Hardin, "The Tragedy of the Commons", Science, 162: 1243 (13 De. 1968).

John Hospers,. "What Libertarianism Is", The Libertarian Alternative, (ed.) Tibor R. Machan, New York: Nelson Hall.

Robert J. Smith, "Privatizing the Environment," Policy Review, Spring, 1982, p. 11.

Margaret Thatcher, The Downing Street Years, Harper Collins, London. P. 626.

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