Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Privatisation has been a costly failure in Britain

economist.com

Post reply on HN
Print view View original

531–540 of 609 posts

Re: Privatisation has been a costly failure in Britain

#531

Post by chimprich »

iso1631 wrote: post #419
chimprich wrote: post #207

Earlier quoted context omitted.

I'm unclear what your argument is here. Having rail be so expensive or badly run that people decide to use roads instead doesn't seem like a win for privatisation. Encouraging people onto roads or even flying is also a disaster for tackling climate change.

Since privatisation in 1994 to pre-covid 2019, rail usage increased from 36 billion km to 80 billion km, more than doubling. Road increased from 666 to 741 bkm, increasing 11%.

An interesting data point to discuss, but not much of a vote for privatisation (which I assume the implication is). In that time we have seen significant urbanisation, which means both more people living in cities and people having to commute to cities to work. Both of these (and limited road capacity) mean more rail travel.

In theory this extra cash and economies of scale should have been an ideal situation whereby rail transport could be significantly improved. In practice we've seen above-inflation fare rises and (in my experience) dreadful services.

Re: Privatisation has been a costly failure in Britain

#532

Post by darkclouds »

lostlogin wrote: post #509
darkclouds wrote: post #487

Earlier quoted context omitted.

>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 it…

> They way they make profit is to degrade service and raise prices. No one is going to install a competing water system.

So that other technologies, like rainfall capture systems and water filtration systems can be become financially viable through economies of scale. If you have a roof you can top up water tanks, water filtration systems clean the water and can recycle the water. Reverse Osmosis filtration which deionises the water is about as pure as you can get, so pure nothing can grow in it, which is why colony forming units (CFU's) aka TVC's are so low, lower than spring water.

https://www.gov.uk/guidance/spring-water-rules-for-local-aut...

This article explains why Thames Water is in the news. https://www.theguardian.com/environment/shortcuts/poll/2013/... "after 2025, Thames Water believes more drastic measures will be needed"

Not long to go.... standby for some more "engineered" news.

>The Economist has a political bent,

Whilst its easy to say, privatise problems, Thames water has its own unique problems, but when looking at something like the coal miners, what did it do? It shifted people away from using coal to other less large airborne particulate laden forms of fossil fuel, the latest being air source heat pumps 1w in 4watts out at best, solar power 15-22% efficiency, and nuclear with the debate over the use of different nuclear fuels, like plutonium and thorium. Sort by Specific Energy (MJ/Kg) at this link https://en.wikipedia.org/wiki/Energy_density#In_nuclear_reac...

Anyway some things are engineered including things in the news like Thames Water.... Someone's getting a shake down!

Re: Privatisation has been a costly failure in Britain

#533

Post by darkclouds »

smcl wrote: post #506
darkclouds wrote: post #487

Earlier quoted context omitted.

>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, o…

> 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.

Carefully chosen words, someone has done their research!

Thats what happens when new standards come into force and improve upon the old standards.

https://environment.data.gov.uk/portalstg/home/item.html?id=...

"The purpose of this dataset is to present a summary of bathing water compliance in England between 1988 and 2014 against the old bathing water directive (76/160/EEC), which was repealed on the 31/12/2014"

However I'm not against better standards, but I am against some of the "engineered" methods used to gain those standards....

https://www.ciwem.org/the-environment/how-should-water-and-e....

As I was saying, some things are engineered....

Re: Privatisation has been a costly failure in Britain

#535

Post by lostlogin »

dffdsa432 wrote: post #265
cycomanic wrote: post #240

Earlier quoted context omitted.

The USPS is "loosing" money because it was told to prefund it's Healthcare having to set aside $100 billion in 10 years (unlike any other company) . Moreover, it's much more a service than a business, e.g. it can not really set its own prices. https://www.barrons.com/articles/usps-louis-dejoy-post-offic...

I don't get it. The USPS has lost billions due to government policies and can't enforce prices due to government policies. They are forced to deliver to unprofitable routes and have prices set to inflation due to government policies. Private delivery services like Amazon and Fedex are generally profitable and don't have these issues. Why is a government alternative better?

Wait until you hear how much money the US military has lost.

Re: Privatisation has been a costly failure in Britain

#536

Post by ukoki »

mnd999 wrote: post #82
mrfumier wrote: post #62

Earlier quoted context omitted.

"And you don't extract profits from a rail line by offering the best service." So how do you extract profits then?

Minimise investment to maximise profits, which you take, whilst running the minimum service required to avoid contract penalties or publicity so adverse you lose your contract. Then threaten to go bust and get bailed out by the government when the infrastructure starts to break a few years later. At least that’s they playbook they’re all using.

>avoid contract penalties

I expect the maximum profit sweet spot actually includes a small amount of penalties. If you don't get any penalties at all, you are probably leaving money on the table re service cuts.

Re: Privatisation has been a costly failure in Britain

#537

Post by ClumsyPilot »

wolframhempel wrote: post #9

I am a deep believer in free markets as the most efficient mechanism for distributing goods and services, creating better offerings and lower prices through competition and encapsulating risk in innovation. Unfortunately, none of these apply to the privatization of inherently public commodities that run on top of an underlying network infrastructure. This can be streets, railway tracks or water pipes - whenever there…

> am a deep believer in free markets

There are more people proffesing their beliefs in this thread, than in most discussions about the Catholic church.

In this entire thread noone considered - "let us have a look, which country has best railways" and maybe learn from Spain and China.

In public discourse, ecomomy is treated like a religion.

Re: Privatisation has been a costly failure in Britain

#538

Post by ClumsyPilot »

iso1631 wrote: post #480
ClumsyPilot wrote: post #453

Earlier quoted context omitted.

they literally tell yoy which stations are accessible and which ones arent.

"get off the train in a wheelchair" Nothing to do with accessible stations, where they simply look up entries in a database and will have very little personal knowledge.

I dont think this is true, but suppose it was - so what? If I am travelling eith my daughter I often need advice from the ticket office folks. It does not matyer how they aquire it.

Additionally, often the ticket office gives better rates -

https://twitter.com/CraigJordanBak1/status/16786743395735101...

The fact that you dont know this, betrays the fact that you havw no idea how the UK ticket prices are actually set

Re: Privatisation has been a costly failure in Britain

#539

Post by rcarr »

Gareth321 wrote: post #310
Puts wrote: post #287

Earlier quoted context omitted.

No there is a middle ground called socialism.

Do you mean socialism or democratic socialism? They're very different and people tend to use the terms interchangeably. Socialism is an authoritarian system of social control which requires that the means of production, distribution, and exchange be owned or regulated by the community as a whole. Democratic socialism is, in effect, restrictions on free markets and democratic control over tax redistribution. Most West…

This is how the majority of the planet outside of the USA, Russia and former USSR states names these ideologies:

authoritarian capitalism -> fascism

democratic capitalism -> capitalism

democratic socialism -> socialism

authoritarian socialism -> communism

From the mixed economy wikipedia:

> Common to all mixed economies is a combination of free-market principles and principles of socialism.[5]

From the socialism page of wikipedia:

> While no single definition encapsulates the many types of socialism,[13] social ownership is the one common element,[6][14] and is considered left-wing.[15]

If you don't have to pay tolls for the majority of the roads that you drive on, you are living a mixed economy because those toll free roads are owned by the state, not by private companies or individuals, and are paid for by taxes. Which makes them a socialist element, most likely within a majority capitalist system. Which makes what you live in a mixed economy. The vast majority of countries on the planet are mixed economies.

It astounds me how this keeps coming up on HN over and over again.

Re: Privatisation has been a costly failure in Britain

#540

Post by jacquesm »

ilikerashers wrote: post #255
auggierose wrote: post #190

Earlier quoted context omitted.

> Too much money is required and they can't just seize the assets. But they can. That's why they are the government.

Are there any examples in modern economies? I know banks were temporarily nationalised but that wasn't a long-term plan.

Absolutely. Recently lots of Russian assets got nationalized in Germany on account of German national security in light of the energy crisis and the war with Ukraine. In NL we nationalized a bank (SNS bank) that failed, and one that would have failed (ABN). In Japan, in the wake of the Fukushima disaster there was an energy company nationalized. The USA (though they don't like to call it that) nationalized a bunch of stuff in the wake of the financial crisis.
Post reply on HN