DOTC: Beware Of Govt Privatization
Here's why Dan of the Community doesn't fall for privatization when it comes for government:
From long experience, I’m always very leery of the push to privatize services that otherwise would be provided by the public sector. It usually costs more in the long run because any private provider has to add in their profit margin into the costs before they provide even the first speck of service. To keep the initial price “competitive” they have to cut employee salaries and benefits. It’s simple math. At first blush that might sound like a good thing but those employees, if they still have a job, now have less to spend at local merchants, and may now qualify for various public assistance programs to boot. None of that is good for the local economy or property taxpayers. More here.
Question: Can you think of an example when government privatization worked?