Public enterprise hasn’t worked
Letter from Dave Skinner
Political economy – April 2003 – Colorado Central Magazine
George Sibley’s approach in “On the Ground” seems to be to socialize everything possible. As a “libertarian Republican,” I’ll try to refute him without resorting to “religious ideology.” To begin, one word explains why airline nationalization is wrong: AEROFLOT.
Public enterprise in the public service hasn’t impressed me much. I think in 1991 or so, backed by service promises from Continental and Mesa airlines, the Steamboat town faddahs landed a $5.2 million federal grant to replace our scruffy two-modulars-and-a- lean-to “terminal.”
I nailed my share of inflated Davis-Bacon pork wages that summer. But Continental and Mesa had ejection-seat clauses (which the faddahs missed). In less than a year, that lovely terminal sat empty except for parties, a testament to both the skills of my co-workers and dumb government. Also around then, the “20/20 Vision” crowd wanted to run “light rail” service on DRGW/SP’s Craig coal line between Oak Creek, Steamboat Springs, Yampa Valley airport, Hayden and Craig. The town fathers and mothers hired a consulting firm, which swooped in, scooped up the money ($200,000), scoped the scene, pooped a report, and swooped out.
The “cheap” option presented to the public was about $5 million for track-related work including a branch track to the Yampa airfield, plus enough used engines and coaches for hourly service that in turn would lose at least $2 million annually.
No matter where you are, losses ARE a given. The Empire Builder, Amtrak’s best, still loses two bucks for every ticket dollar. Los Angeles’s heavy-rail passengers put 18 cents back for every dollar it costs to give them a ride.
After the consultant finished telling us the deal would be a money pit, an earnest yuppie type raised his hand and asked “Well, can’t we get a grant from somewhere and TRY it for a year?” Geez, why not….HE’S not paying for it…probably hoping there was a JOB in it for him.
As for George’s paean to socialized medicine, further socializing an already partly-socialized system won’t work.
It’s a basic rule of economics, both public and private, that when the direct benefits of using something outweigh the direct costs, demand overruns supply. Crowded freeways are Example Number One — a situation that tolls would fix right quick.
Example Number Two is Medicare. Its users (seniors) don’t pay their full costs, so they inherently use “too much.” Against this taxpayer-subsidized inflated demand, the government sets price caps, which in turn forces providers to stick it to insured and uninsured private customers — who until they hit the magic 65, pay premiums for what they get, AND pay taxes for what seniors are getting. As a kiddie-cancer survivor, I should LOVE socialized medicine. A month’s insurance with a cancer rider and a ten-grand deductible cost six months rent for a single 23-year-old. Either I became a slave to the insurance company, or I could continue to eat well, ski fast, and hope to hell I never got sick. That was a scary, scary risk to take, but it’s worked so far. I pay CASH for doctors and pills. Trust me, I don’t use either very much, and certainly no more than I need.
With socialized medicine, need wouldn’t be an issue at all — I could just run to Medicaid and toss myself on the mercy of the state. But since when is everyone else responsible for MY health? They aren’t. God (that’s if there IS a God) sure ain’t. I am.
Hey, all you liberals out there — I’m a REPUBLICAN — why would you want to be taxed to cure my cancers? Don’t you want me to DIE so I can’t vote against you?
The same question can be asked for just about every “public good.” Since when is everyone else in America responsible for direct jets to Crusty Butt? Computers for your kid? They aren’t. YOU are. Socializing public services or any other “public good” nearly always leads to skewed decisions leading to wasted money and effort.
Think about it. Private customers only use what they want to buy, and further don’t have to come into the “store” at all.
In contrast, “the taxpayer” is never asked what they want, how much they want, or if they are willing to pay for that “public good” at all. Regardless of whether they get too much, too little, nothing, or, most often, the wrong thing, taxpayers simply pay — and they NEVER get a refund.
Did you enjoy this story?
Help us continue to provide exciting, informative content.
SUBSCRIBE to the print edition of Colorado Central Magazine.
Only $25 for one year. CLICK HERE NOW.