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Privatization is a rip-off |
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Written by Rozalyn Sherman
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Friday, 09 February 2007 |
Published in The Daily Targum (Rutgers)
Click here for link to published letter
I, like so many others, have been reading about the various privatization options being offered up by Trenton to ease our budget deficit. With all of the news articles about possible sales, I have noted a lack of information about what the downside of these deals might be.
I recently received a publication in which they mentioned several privatization deals made throughout the country and what the consequences of those deals have been, and it really opened my eyes.
New Jersey is not alone in the privatization mania. Indiana, Washington D.C. and Illinois privatized their lottery. Virginia, Illinois and Texas privatized their toll roads. Florida and New Mexico privatized prisons.
We all know no company is offering those big bucks for a losing business proposition. Privatized firms can expect so much money in the future because they can do things the politicians might not be able to get away with if the decisions were subject to democratic accountability. They can raise tolls without a political debate or use marketing or employment practices that would be stopped in their tracks if the job was still being done by the public sector.
Most toll road privatizations assume sharp increases in tolls in the future under the control of private firms that won't be held politically responsible for those decisions.
Private lotteries will no longer be subject to present political restraints. Such firms will likely advertise more aggressively, especially among people susceptible to gambling addiction and those who can least afford to lose money on lottery tickets. Similarly, private contractors can profit from lower wages and poor treatment of employees in a way the public sector generally cannot, in full-time employees being replaced by more part-time workers.
But that's the beauty of privatization - out of sight, out of mind, except for the contractor's profit sheets. The short-term relief will wind up being long-term headaches and problems for New Jersey residents, and our children and grandchildren.
Is it possible what keeps these deals going across the country is that the money to be made by private contractors means they'll continue greasing the political wheels to keep the deals coming?
We need a broad public recognition that these big-ticket privatization deals are taxpayer rip-offs that benefit only the private contractors and the short-term interests of a few politicians at the expense of the public. Hopefully, more state leaders will get that message from their constituents before too much of our future is put on the auction block.
Rozalyn Sherman is a resident of Somerset.
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Last Updated ( Saturday, 28 July 2007 )
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