Digby directs us all to this piece by Ezra Klein in the Los Angeles Times. Digby's comments are as worthy of serious study (as always) as is Klein's original. I just want to use Klein's piece for a particular, partially meta, rant that I have not stated clearly enough, although I have mentioned it on occasion. I believe that much of the predicament we find ourselves in can be traced back to a little book, little noticed at the time, but heralded since as a kind of primer for non-economists, on the economic theories of Milton Friedman. The book, Capitalism and Freedom, spins a tale of the magical (in the previous post I call them occult; it's all the same) powers of the market to heal all wounds, raise all boats, fly all planes, repair all roads, and pay for all goods and services. While there was much debate in the early Reagan years over just how far the devolution of public services to private entities was good or even necessary, the collapse of Central and Eastern European Communism in the period 1989-1991 gave free marketers a wonderful opportunity to show how marvelous markets actually were. Of course, the results were a dismal failure, but we have been fed such a line of crap by market fundamentalists that we non-economists (or at least, non-analytical economists; most of us have the tools to figure out what's wrong without reading Freidman, Keynes, or Samuelson) seem lost at sea as the situation has spun seemingly out of control.
One of the silliest, stupidest, and most unrealistic parts of Friedman's little book was arguing that municipal services would be better done through market mechanisms than through direct public intervention. His argument goes something like this: with only one entity involved in the decision making on what roads get fixed, what the make-up of the police force is, who picks up the garbage when on what days, and so forth, we have created a monopoly. This creates a situation rife with opportunities for mismanagement, price exploitation, graft, and inefficiency. Rather than rely upon localities to determine their needs and make the effort to fill them, citizens would be better served by allowing various private firms to compete for the privilege of paving our streets, picking up our garbage, treating our sewage, and so forth. With competition comes the possibility of lower cost. Part of winning would be providing the service at a lower per capita rate than we currently pay through taxation. Efficiency would be part of the marketing behind attracting better quality local services. The company that would provide the service better, at a lower cost, than is currently provided for would be the winner. Rather than taxed, local citizens would simply be billed by the company. As companies continued to compete for these evolving contracts, the incentives to do it better cheaper would increase the overall efficiency of the services provided.
At the heart of this entire argument is a flaw that goes unnoticed. It would seem to be a negligible argument against Friedman, but it goes to the heart of the matter as it were, and can be summed up like this. No public institution - no government of any size worthy of the name - has ever operated in this manner, nor could it sustain itself for long if it did so. Friedman's flights of fancy are ahistorical, unreflective of the potential for even greater graft and corruption inherent in such a proposal, and reveal a certain devil-may-care attitude towards the grimy details of how municipal government works (and more than occasionally doesn't work) that should dissuade one from taking this seriously.
This is kind of Government 101 here, but bear with me.
Whether it is the feds, states, or our local entities (counties, villages, townships, whatever), government has legitimacy to the extent that it provides basic services that serve the common interest, such as building and maintaining roads, providing public protection, keeping the commons clean, etc. As government cedes more and more of these functions to private companies they are, in effect, ceding their legitimacy to private entities. We are not just ridding ourselves of inefficient public services, but declaring that we do not believe in the legitimacy of our public service providers, and their overseers and regulators in government. This is a huge no-confidence vote in the very idea of self-governance. No system, no government, could or can survive very long if it is constantly undercut in this way.
There are surely arguments that can and have been made about the way public services are provided. There are all sorts of mechanisms that have been or could be put in place to provide public services more cheaply, more efficiently, and reduce the possibility of corruption, lack of or loss of service, and the rest. Pretending, however, that the public has no vital interest in the public interest in the name of some abstract goal of efficiency, however, is destructive of the very heart of self-government.
Many, including me, have said this before, and I will say it again. We are living at a vital time in the history of our country, one I thought would never return. We are returning to the idea, once thought discarded, that the public interest is better served by public bodies than private, for-profit entities. The dismal failures of the Bush Administration are not an argument for less government, but in fact serve as arguments, not so much for more government, but for the necessity of government services that work for and in the public welfare. Milton Friedman's little fantasy mini-epic should be tossed by the wayside, and we should return to a certain fundamental truth - we as a people, in charge as we are of our public life, should insist that we are not to hand over to others what is ours to care for.
Virtual Tin Cup
