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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

#501

Post by mnd999 »

tialaramex wrote: post #152
mnd999 wrote: post #42

Earlier quoted context omitted.

Just to keep jobs? No. To ensure resiliency of supply? maybe. Probably moot as this point though since we should be getting away from coal anyway.

Sure, Margaret Thatcher accidentally did us a favour by killing the coal unions. But just in case you thought "Good, no more coal" the Tories actually authorised a brand new coal mine not so long ago, because sure, it's a terrible idea but it will make somebody wealthy and as we see here, their priority is to make the wealthiest people even wealthier.

The new coal mine is actually a green energy scheme. They plan to attach a dynamo to Maggies corpse - the expectation is it will be spinning pretty rapidly in her grave.

Re: Privatisation has been a costly failure in Britain

#502

Post by aeyes »

BoiledCabbage wrote: post #450
refurb wrote: post #258

Earlier quoted context omitted.

Not really, it works really well for truly free markets like cosmetic surgery and vision correction. The “free market” healthcare in the US isn’t free at all, there are a ton of regulations many of which make it worse, not better.

No, it's because those aren't essential services that people need with little option to competitively shop for. People can choose not to get cosmetic surgery, or postpone it significantly, or shop attorney between many different options. They frequently can't for their health decisions. Again, it's 'market competition' amidst healthy consumer choice, not 'free markets' that are beneficial for society.

And the healthcare providers make it hard to even see their prices up front. It's like going into a grocery store without price tags. You can't really compare prices.

Re: Privatisation has been a costly failure in Britain

#503

Post by censor_me »

pydry wrote: post #99
markus_zhang wrote: post #83

Earlier quoted context omitted.

Privatization of public sector has nothing to do with free market. Free market has been dead since the 19th century.

In the 19th century the cult of the free market was used to justify exporting all of Ireland's food while the Irish starved to death. The cult has only grown in influence since then.

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Re: Privatisation has been a costly failure in Britain

#504

Post by inconceivable »

twobitshifter wrote: post #360
lotsofpulp wrote: post #202

Earlier quoted context omitted.

How are shareholder returns and profit different?

You can return value to shareholders that doesn’t come out of profits. For example, selling off your assets doesn’t make you profit, but gives you cash on hand. If that money is returned to shareholders, you’ve changed your balance sheet, but haven’t made any profit. An even simpler example is just selling the company to someone else. The shareholders get whatever the agreed on price was to take it private.

> For example, selling off your assets doesn’t make you profit

if it's on the balance sheet and you sell it for more than it cost you, then you have to book it as non-operating income, i.e. capital gains, i.e. profit.

Re: Privatisation has been a costly failure in Britain

#505

Post by nucleardog »

pydry wrote: post #120
jack_riminton wrote: post #19

Earlier quoted context omitted.

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.…

Even in markets with competition, competition from the public sector is an excellent way of exerting market discipline on dysfunctional markets. If you compare the average quality of housing in, for example, Singapore (where 90% of housing is public) and the UK it's like night and day. UK private landlords are among the laziest and most entitled in the entire world, the land use efficiency is terrible and the buildin…

My favorite example of this is telecoms in Canada. Both public competition and dysfunctional markets.

Saskatchewan has SaskTel. It’s a public telecom that provides internet (DSL, fiber, wireless)/POTS/cellular. They and their subsidiaries (e.g., SaskTel International) provide all sorts of other services.

When the CRTC removed rules about charging for data overages and things, they didn’t implement any additional charges because their mandate is to serve the people of the province not extract the most profit for shareholders.

They contribute money back into the government coffers every year while also being the sole telecom covering large swathes of the province, working through a FTTH rollout, etc.

When I went to sign up for a cellular plan with a different provider, the person on the phone kept telling me the plan didn’t exist—they had the same plan, but it was $30/mo more than what I was telling them.

Because they had the wrong province selected. All of that provider’s plans were 30-50% cheaper in my province due to the competition from the (profitable) public telecom.

I’ve been away a while, it’s probably gone to shit by now (when I left the government was trying to sell it off for a quick buck _again_), but at the time it was magical to live in the only place in the entire country with an even relatively sane cellular market.

Re: Privatisation has been a costly failure in Britain

#506

Post by smcl »

darkclouds wrote: post #487
rightbyte wrote: post #241

Earlier quoted context omitted.

CEOs have almost no competitive pressure. They are mostly recruited within the upper class. Paying more won't net you a better one.

>CEOs have almost no competitive pressure. Yes they do, from rival businesses, superior and new technology, just look at Chat-GPT potentially putting programmers out of work, or telegrams being made redundant by pagers, and text messages and email. @arethuza >CEOs of corporations of the same size quite often have to find and retain customers in competitive markets - which is hardly the case with Thames Water? Water c…

I don't think you understand what these companies do if you believe Thames Water is in competition with Evian or Brita. Remember they're not just providing drinking water but handling the treatment, recirculation and safe disposal of wastewater too. So in addition to having inadequate fresh water storage for some parts of England and cutting back maintenance to the extent that they lose an enormous amount in leaks, one of the bigger problems is how they're failing to adequately dispose of wastewater. As a consequence of this there are some rivers, lakes and beaches in England + Wales that are now unsafe but which weren't before they were privatised.

Re: Privatisation has been a costly failure in Britain

#507

Post by lhnz »

hgomersall wrote: post #490
lhnz wrote: post #177

The UK is increasingly resembling the rest of the world's rentpig. The UK government has made Britain into one massive investment vehicle for foreign capital -- our utilities, leading firms, football teams, landmarks and property all serve to enrich sovereign wealth funds in the Middle East and Asia. These foreign investors have all received lavish incentives and grants, and in return we have been allowed to live way…

The problem in your analysis is that you are thinking about the money rather than thinking about the resources. All those people haven't gone anywhere and all the capital (as run down as it is) still exists. The wealthy are not very useful when it comes to contributing, because they don't have that much more to contribute than anyone else (even purloining their additionally consumed resources doesn't contribute very…

  > In truth, what needs to happen is the government needs to realise that
  > what limits our wealth is our resource constraints and enact policies 
  > on that basis, instead of fussing about artificial financial constraints.
Indeed, the government must understand that wealth hinges on available resources, not financial limits. Policies should reflect this.

Yet, the UK seems hesitant to utilise natural resources, develop housing/infrastructure, or encourage investment in capital or innovation.

We've been rich and industrialised for so long we have forgotten that wealth isn’t created out of nothing. Our attitude towards fossil fuels is particularly indicative of this. Coal made this country an industrial superpower. We forgot that the key to our economic power started and will always start with energy -- and that this is often dirty.

Today we a country of financial services and coffee shops, because we believe we are above the truly productive sectors of the economy.

Re: Privatisation has been a costly failure in Britain

#508

Post by censor_me »

hgomersall wrote: post #490
lhnz wrote: post #177

The UK is increasingly resembling the rest of the world's rentpig. The UK government has made Britain into one massive investment vehicle for foreign capital -- our utilities, leading firms, football teams, landmarks and property all serve to enrich sovereign wealth funds in the Middle East and Asia. These foreign investors have all received lavish incentives and grants, and in return we have been allowed to live way…

The problem in your analysis is that you are thinking about the money rather than thinking about the resources. All those people haven't gone anywhere and all the capital (as run down as it is) still exists. The wealthy are not very useful when it comes to contributing, because they don't have that much more to contribute than anyone else (even purloining their additionally consumed resources doesn't contribute very…

[dead]

Re: Privatisation has been a costly failure in Britain

#509

Post by lostlogin »

darkclouds wrote: post #487
rightbyte wrote: post #241

Earlier quoted context omitted.

CEOs have almost no competitive pressure. They are mostly recruited within the upper class. Paying more won't net you a better one.

>CEOs have almost no competitive pressure. Yes they do, from rival businesses, superior and new technology, just look at Chat-GPT potentially putting programmers out of work, or telegrams being made redundant by pagers, and text messages and email. @arethuza >CEOs of corporations of the same size quite often have to find and retain customers in competitive markets - which is hardly the case with Thames Water? Water c…

> Yes they do

In the examples here, no, CEOs don’t face real competition. Water companies are sold off public utilities. They way they make profit is to degrade service and raise prices. No one is going to install a competing water system. No AI is going to do that anytime soon.

The Economist has a political bent, but they are clear on how privatisation has gone: ‘Dogmatic adherence to privatisation in the face of its sustained failure suggests ideology, not pragmatism, was the motivation.’

> Water companies are delivering a minimum standard of water

No they aren’t. That’s a key point in the article.

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