From the post.
I cannot think of any field in which the growth of public-private partnerships results from "progressive ideologues...arguing for ever greater government control over everything." In every case I can think of, the growth of public-private partnerships is linked to the Washington Consensus-era belief of both conservative and neo-liberal ideologues that anything government can do, the private sector can do better. For that matter, there are plenty of examples of really great public-private partnerships, like many charter schools, or build-operate-transfer deals to get roads, railways, bridges and airports built more efficiently than they might be if done by government. Anyway, the point is that trying to describe the history of the past 30 years, with its great growth in inequality and increasing influence of money on politics, as one of increasingly progressive ideology leading to growing government intervention in the economy seems to me impossibly far-fetched.
Most of the Tea-Party types that surround me think that government is and has been in the process of taking over the private sector, when in reality, for the last thirty years, there has been a lot of the opposite. The private sector has been slowly encroaching on government through public-private partnerships, like The Military/Blackwater, and privatization of government services like water, sewage, electric utilities, and jails. I think there's a good chance that these public-private partnerships end up being less efficient, more corrupt and generally not working as well as either solely-government or solely-private enterprises.
PPPs are usually sold to the taxpayers on the premise that the private operator will run the program more efficiently, saving taxpayer dollars. I'm not sure that those efficiencies are really there. Sure government can be inefficient but so can private business(see below) and those businesses also have to make a profit which adds to their cost of doing business. There's also a corruption factor. It seems to me public-private enterprises have higher levels of corruption than either alone as it's often easier for the private business to increase profits by over-charging or rent-seeking than by actually being more efficient. So, does government inefficiency cost more than business inefficiency plus business profits plus the corruption factor? I don't know but I'd bet in many cases government can get the job done cheaper by itself than with a PPP.
Hell, look at two PPPs that are always in the news, health care and education. Both are a good mix of public and private enterprise and for years both have seen costs rising at much higher than normal inflation rates. As a nation we pay almost twice as much as other developed countries for basically the same level of health care. Our education system is loading down our kids with amazingly high levels of debt while not really offering better outcomes than the rest of the world. It's pretty easy to see that these PPPs aren't working.
Anyway, my takeaways from the Economist post;
1. People don't realize that a lot (most?) of the merging of government and private business over the last 30- 40 years is driven from the private side, with business taking over government services, rather than the government taking over private business.
2. These PPPs could be less efficient than either government or private industry alone.
note: Is private business efficient? Markets may be but I'm not sure about businesses themselves. Everywhere I look at big business is see problems. Think about your last call to the cable company, the gas company, the telephone company, a technical support company. Think about the inefficiencies at any big company you've ever worked for. The financial crisis? The US auto industry? It just doesn't look that efficient to me.
tnb
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