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Privatisation has been a costly failure in Britain

economist.com

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Re: Privatisation has been a costly failure in Britain

#11

Post by pydry »

rob74 wrote: post #5

The Economist, publishing an article (even just an opinion piece by a guest author) about privatisation being a failure? Wow...

The failures of this one have become a bit too obvious to deny.

The Economist is a bit like RT - denying that everything is going wrong in Kharkiv to a point but beyond a certain threshold they eventually stopped and admitted reality.

I'd be curious to see what their views were about Thames Water privatization were in the past before all this stuff came out. That'll give a clearer picture of their true views.

Re: Privatisation has been a costly failure in Britain

#14

Post by Lockyy »

Is this surprising? People have been crying out about the effects of privatisation for years. When basic services mandatory for modern human life like water, ISPs and energy are privatised you end up with funds that could end up going towards investment or towards funding other public services are instead funnelled out towards shareholders.

The generational wealth the UK had in the form of North Sea oil passed off to private interests for their own profit rather than used for the creation of a sovereign wealth fund like the ones Norway has is a perfect example of the sort of backwards situation you end up in. That oil could have been used for the benefit by every member of the UK public and instead is used only for the benefit of the few while the public suffers under outrageous energy and cost of living increases.

edit: added missing word, "has" after Norway

Re: Privatisation has been a costly failure in Britain

#15

Post by mnd999 »

rob74 wrote: post #5

The Economist, publishing an article (even just an opinion piece by a guest author) about privatisation being a failure? Wow...

It’s reached the point where it’s not credible to say otherwise. That doesn’t seem to stop the government though.

Re: Privatisation has been a costly failure in Britain

#18

Post by brutusborn »

PartiallyTyped wrote: post #6
tnel77 wrote: post #3

When profit becomes the main motivator, quality of services always seem to drop. I get that the government can be annoying, but I feel like there are many services that we should aim to provide as a society where profit isn’t the goal. For example, you don’t need to price gouge people for electricity, but charging enough to cover expenses and future infrastructure upgrades is fine and to be expected. No costly CEO or…

Add education to that too. It should be pretty obvious to everyone that quality education is a matter of national security but here we are, with people proudly uneducated, who - in their wilful ignorance - harm others. Thank you to everyone who flagged me and now I can't respond or comment in this thread <3

I think education is actually case where the free market would solve a lot of issues. Making schools compete for students would incentivise schools to provide a more valuable education.

Re: Privatisation has been a costly failure in Britain

#19

Post by jack_riminton »

tnel77 wrote: post #3

When profit becomes the main motivator, quality of services always seem to drop. I get that the government can be annoying, but I feel like there are many services that we should aim to provide as a society where profit isn’t the goal. For example, you don’t need to price gouge people for electricity, but charging enough to cover expenses and future infrastructure upgrades is fine and to be expected. No costly CEO or…

Exactly. Fake competition in utilities and services makes no sense. The "privatisation" of the UK railways is a prime example. I use quotation marks because it's just privatising the profits and socialising the losses.

"from March 2020 to February this year, the Government paid out more than £7.3 billion in operational support to private train operators" - https://bylinetimes.com/2021/05/18/7-billion-covid-bailout-f...

Re: Privatisation has been a costly failure in Britain

#20

Post by maxboone »

smcl wrote: post #4

> Since then the sector has accumulated £53bn in debt while distributing £72bn to shareholders, the majority of whom are international investors someone who is good at the economy please help me budget this. my family is dying

It's been a while, but iirc you increase leverage of a company (by putting the company in debt) to be able to deduct taxes using tax shields on the interest.

Infamous example are leveraged buyouts, i.e. finance the takeover of a company by putting the company in debt. I think Twitter was an LBO.

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