The Problem Is Privatization

[Plaid Adder]

The real issue that the port sale is bringing to light is the collision between privatization and globalization. If you take the approach--as Bush et al. do--that absolutely everything is for sale to the highest bidder (which is what privatization means, in a nutshell), then ultimately you no longer control your own territory. The third world found this out a long time ago: those who own you rule you. We have not had to confront this because until fairly recently we had most of the money. Now that we are deeply in the red, it would behoove us to rethink this privatization thing.

The basic point to emphasize here is that privatizing the infrastructure transfers control from the government to the corporations who buy the rights to operate and maintain it--and that these corporations are not accountable to us. Now, in many ways, this is a problem whether the corporation is American-owned or not, because corporations are so structured that the bottom line is always more important than ethical, moral, or political considerations. (This is actually legally encoded into the corporate structure, which lays its members under a fiduciary duty to the shareholders which requires them to maximize profits at all costs.) Many of us have been trying to point this out for a long time, but of course nobody cares, because to question the dominance of American corporations just makes you a Communist who hates America.

Well, we're reaching a point where a lot of the corporations who want a piece of our infrastructure are not American-owned. In 2004 Mayor Daley 'leased' the Chicago Skyway, the main artery that connects Chicago to northwest Indiana, for 99 years to a Spanish company called the Cintra Macquarie Consortium. Nobody worries that Spain is going to smuggle dirty bombs along the tollway, of course; but they have raised the toll rates and will undoubtedly do it again, and they are not under any special obligations to actually maintain the damn thing.

Once you decide you're going to privatize something you can't get picky about who buys it without flying in the face of the sacred principles of free-market capitalism. According to these core principles, the fact that the company that used to operate these ports has been acquired by a corporation owned by the UAE government is just business as usual and there's no reason to fret over it or try to prevent it. Dubai Ports World has the right to buy whatever it wants, and surely they will be rational and do the best job they can of running the ports because that will make other people more excited about selling them more stuff and thus contribute to their financial health and growth.

And you know what, who knows, maybe that's what will happen. Maybe it's not. The point is, it will be up to Dubai Ports World to maintain what they've bought. If they decide not to operate these ports in a manner conducive to national security, well, there's kind of fuck-all we can do about it, since the Republicans have spent the past 35 years trying to make it harder and harder for the federal government to control what corporations do.

The real opportunity here, beyond making Bush look bad, is to use the port sale to educate Americans about the problems created by privatization and deregulation. Thanks to all the fearmongering, national security and terrorism are about the only things the Fox crowd understands or cares about, so this is our only chance to explain to them why the Bush team's lust for privatization is bad for them.

C ya,

The Plaid Adder

[Karenina]

1. Bingo!

:yourock:

[Lydia Leftcoast]

2. Yup, it's all about cushy deals for one's friends

The MSM derided the Russian profiteers who looted the formerly state-owned factories and facilities after the end of Communist rule, but aren't the privatizers doing the same thing?

[unblock]

3. piratization is the new patronage

used to be you had to lean on government officials to hire your buddies.
now that everything's piratized, you just steer the contract to your buddies, bypassing the bidding process if need be.

so much easier this way, and so much more money available for piratization this way.

[sui generis]

4. Kind of like toll roads

You don't have to use the toll road that is privatized out to a foreign company, but the alternative is to drive through endless sidestreets, school zones and residential neighborhoods.

Permanent toll roads are a regressive tax, and the excess funds from operating a toll road "are under no obligation" to go back into road building and maintenance in Texas.

I imagine that port management fees, or whatever a port authority charges and profits from are subject to exactly the same free market issues that drive profit everywhere.

You either arbitrarily declare higher fees, change the threshold and shipping types upon which you charge various fees, or you lower the cost of your maintenance to give you enough spread to achieve a profit.

I recently changed my license plate on one of my cars and didn't notify our Tollway authority, and ran about 125 tolls (charged without incident) but was charged $25 per gate access for not telling them I had changed my license plate for a whopping total of $3,125 dollars in fines (fought and dropped).

I can't imagine that every possible means of generating 'profit' won't be similarly employed at our ports. Hey, your ship is painted the wrong color. $100,000 fine.

:shrug:

What else occurs to me? Imported labor. Discuss. Are they under any obligation to pay their port employees according to U.S. labor standards? What else does that imply?

[Mandate My Ass]

5. Cheap labor definitely

That's why prison privatization has turned into a nightmare on so many levels. They pay very little and require little or no training and the guards and health care workers are inept at best, totally incompetent or corrupt at worst. The lawsuits against them are mounting, but there is nothing the government can do to alleviate the problem because there's no accountability. And while there have been some successful lawsuits when a case of abuse or incompetence was particularly egregious, it's back to business as usual the next day. They change some of the faces but nothing of significance changes.

Oh and when the incompetence leads to a prison break or riot, the taxpayers pick up the tab for increased manpower needed to alleviate the situation. Plus, they usually require a "minimum" head count to keep their prices low, so now you can see why we're the number one jailer in the world.

edited to add link and snip:

http://www.correctionsproject.com/corrections/pris_priv.htm

DOES THIS MEAN THE PUBLIC PROFITS FROM PRIVATIZATION?
Although the predominant myths about PRIVATIZATION (whether of prisons or anything else) claim that privatization means tax savings for the public, it actually costs us more. Even though on paper a private agency or corporation may present a lower figure to do the same job, once that money has been taken out of the public's hands, it no longer remains ours.

In the public sector, tax money tends to make more of itself, meaning that each public dollar paid through one social service will spend itself four to eight times more elsewhere within the public sector. Once public money goes into private hands however, that money stays there and is gone for good. This is especially true if we consider that privatization corporations are usually given handsome tax breaks and "incentives," in the form of what some people call "corporate welfare," which means we are even less likely to see that money again.

And finally, if we remember that the people who privatize are generally wealthy, this reminds us of an old story where the rich get richer and the poor get poorer -- where the hard earned tax money from each of us is funneled into the hands of the wealthy few for their own personal gain. While we each like to think we don't live in a society like that, today this is justified to us through the myth that "free markets" are the same thing as democracy; that if everything is privatized and ruled by the law of the dollar then democracy will be ensured.

[Karenina]

6. Great post!

:thumbsup: