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> The private corporations will quickly increase prices while reducing services. > This is fairly simplistic It is a simple view that summarizes really well wh

> The private corporations will quickly increase prices while reducing services. > This is fairly simplistic It is a simple view that summarizes really well what happens when public services are privatized. There is more nuance to it, but the main effects are "de-investment", "increase in price", "reduction of service". > "politicized government can't run services well". I understand your statement as "a polarizing/corrupt government" as I guess that all governments are politicized, it is in their job title.

bhupy 6y ago
> It is a simple view that summarizes really well what happens when public services are privatized. There is more nuance to it, but the main effects are "de-investment", "increase in price", "reduction of service". It's simplistic because "increase in price" and "reduction of service" have not been observed to happen in private sector services today. If you look at the vast majority of goods & services across the board, prices have decreased over time, and service has improved dramatically. This is because the pricing system and competition act as a downward pressure on price and an upward pressure on service quality. This is obviously not always the case (eg. monopolies), but it is the case for the vast majority of goods & services. Food, clothing, transportation, information technology, electronics, appliances — have all gotten cheaper over time (even relative to inflation), have seen an increase in investment over time, and an increase in quality over time. Another concrete example: NASA's planned SLS moon mission is a bit of a disaster — way over budget and way behind schedule. Because the boosters aren't reusable, each launch is expected to cost $1B (with a B) dollars — EACH launch! Meanwhile SpaceX's target cost-per-launch is $50M. Central planning almost never yields the optimum allocation of resources (there are certainly exceptions), whereas the decentralized pricing system almost always does (there are certainly exceptions). While it's simplistic to say that "government doesn't run services well", it's just as simplistic to suggest that "privatization results in price increases and service decreases". > I understand your statement as "a polarizing/corrupt government" as I guess that all governments are politicized, it is in their job title. Correct, which suggests that "government can't run services well" will always be true, for as long as governments are polarized/corrupt. Democracy doesn't yield the best results when you're participating in that democracy with people who violently disagree with you. Governments can be good at running things if everyone agrees on how it should be run, and even then there's no guarantee because central planning usually doesn't yield optimum resource allocation, due to the economic calculation problem.

bhupy 6y ago

> It is a simple view that summarizes really well what happens when public services are privatized. There is more nuance to it, but the main effects are "de-investment", "increase in price", "reduction of service". It's simplistic because "increase in price" and "reduction of service" have not been observed to happen in private sector services today. If you look at the vast majority of goods & services across the board, prices have decreased over time, and service has improved dramatically. This is because the pricing system and competition act as a downward pressure on price and an upward pressure on service quality. This is obviously not always the case (eg. monopolies), but it is the case for the vast majority of goods & services. Food, clothing, transportation, information technology, electronics, appliances — have all gotten cheaper over time (even relative to inflation), have seen an increase in investment over time, and an increase in quality over time. Another concrete example: NASA's planned SLS moon mission is a bit of a disaster — way over budget and way behind schedule. Because the boosters aren't reusable, each launch is expected to cost $1B (with a B) dollars — EACH launch! Meanwhile SpaceX's target cost-per-launch is $50M. Central planning almost never yields the optimum allocation of resources (there are certainly exceptions), whereas the decentralized pricing system almost always does (there are certainly exceptions). While it's simplistic to say that "government doesn't run services well", it's just as simplistic to suggest that "privatization results in price increases and service decreases". > I understand your statement as "a polarizing/corrupt government" as I guess that all governments are politicized, it is in their job title. Correct, which suggests that "government can't run services well" will always be true, for as long as governments are polarized/corrupt. Democracy doesn't yield the best results when you're participating in that democracy with people who violently disagree with you. Governments can be good at running things if everyone agrees on how it should be run, and even then there's no guarantee because central planning usually doesn't yield optimum resource allocation, due to the economic calculation problem.