[FoRK] Capitalism, Contracts and Cronyism

Stephen D. Williams sdw at lig.net
Tue Aug 26 16:05:21 PDT 2008

Jeff Bone wrote:
> On Aug 26, 2008, at 3:04 PM, J. Andrew Rogers wrote:
>> On Aug 26, 2008, at 12:51 PM, J. Andrew Rogers wrote:
>>> It is not a big stretch to suggest that shitty privatization is 
>>> still more efficient than having the government do it themselves.
> Sing it, brother!
If and only if there is competition in the privatization.  Privatization 
that is monopoly, or at list oligopoly, protected, rushed, and 
unscrutinized because it would reflect badly on the royalty connected to 
it is very often not only a kleptocracy but highly ineffective also.  At 
least with government officials, you can prosecute corruption.  With a 
typical privatization scheme, there's nothing to prosecute, people 
pocket money at will when the contracts allow it.

Add in complete openness and real competition, especially when anything 
is very far from theoretical optimum efficiency, and things will clean 
up fast.
  I have no problem with a company making profit on the savings they 
introduce over an equivalent government agency, but they had better be 
better in every way the whole time or be spanked for it.

Privatized government functions should result in open and complete 
information about finances, issues, management, lobbying, etc.  They 
should be held to higher standards on ethics, treatment of "customers" 
(or prisoners), frequent and pervasive auditing, etc.  The lack of any 
of this really signals the intent to defraud and otherwise cut corners 
which makes privatization a bad deal for the public.  You have to allow 
for learning curves, labor pool issues, and some degree of incompetence, 
however there has to be consequences for failure and openings for 
competitors.  And there should never be a single master contractor that 
handles everything.  You have to have competition.
>>> Even the crustiest of big old companies was never as bloated and 
>>> inefficient as the Federal government in my experience.  If 
>>> government was competent, companies like Haliburton would have no 
>>> reason to exist and they've thrived for decades.
>> To expand on this, for all the hate Halliburton gets as part of some 
>> neocon conspiracy, they received the same kinds of no-bid contracts 
>> from the Clinton Administration for Kosovo etc, with the same kinds 
>> of dubious accounting and lost money.  Neither the Democrats nor 
>> Republicans are unique in this regard and Halliburton has been in 
>> this business a long time.
>> Halliburton's place in the world would be obviated if the government 
>> was competent enough to run their own operations in the first place, 
>> but neither the Clinton nor Bush administration ever saw fit to 
>> address that issue.  You would have to dislodge decades of 
>> institutional cruft and fire thousands of career government employees 
>> for that to happen, so there is no reason to be sanguine. Twenty 
>> years from now, Halliburton will still be doing what Halliburton 
>> does, whether the government is Democrat or Republican.  Just like it 
>> always has.
> With all due respect to James, Halliburton & Friends it's clear that 
> the magnitude of the things we're talking about, particularly apropos 
> just a few preferred companies, has escalated greatly under Bush 
> (particularly years 2-6) --- to levels significantly higher than ever 
> before.  Not surprising, given that the upper echelons of the Bush 
> administration in general were / are largely congruent with the upper 
> management, ownership, and others in positions of influence (and 
> benefit) with respect to those companies.  Don't believe me?  Just go 
> look at the OMB's budget spreadsheets for the period, and explain 
> where the bump in e.g. "office of the president" line comes from.  And 
> that's the small, on-the-books stuff.  BBC thinks $23 yards in Iraq 
> alone?  I'd estimate several times that considering all appropriations.
> There is no doubt that Bush Inc. is a kleptocracy the likes the world 
> has never seen before.  So much so that most refuse to even consider 
> it, it's so outrageous and preposterous.
> McCain has largely been an outsider to those circles for years.  
> Whether he's now been admitted as a provisional member remains to be 
> seen.
> But I'll a bold statement, here:  if the choice is between 
> continuation of current policies and effects for another 4-8 years 
> versus a complete meltdown of the economy --- and I'm talking severe, 
> Depression-era style but worse in terms of its long-term impact and 
> the magnitude of its impact on our economy vs. the rest of the world 
> --- I'll unhappily opt for the former.
That thinking is just bizarre to me.  What tipping point is going to be 
caused that couldn't be corrected 3 months later?  If we are in that bad 
of shape, we should indeed pull out of much of our external military 
spending and focus on competitiveness.  Starting with demanding 99 year 
leases and the ability for an immigrant population to run business on 
land and resources from every country we give any aid to from now on.  
There are so many ways to solve the avoid-the-depression thing.  Nuclear 
power, electric cars, etc.

Things keep getting worse because they can get a whole lot worse before 
it's really a worry to any real depth, overall.  I don't believe the 
economy is as fragile as you imply.  Since you seem to be doing well, 
I'm not sure where the pessimism comes from.  You haven't explained how 
your possibly weak interpretation of the idealistic proclivities of 
Obama guarantees an economic death spiral.  Please try again.
> That's (a) a false dichotomy, though;  there are no givens; and / or 
> (b) as mentioned only the hysterical, the fooled, and the partisan 
> axe-grinders believe that McCain is Bush.
So far, McCain is filling those shoes just a little too comfortably.  I 
don't know how he was convinced to go that route, but it's not attractive.
> jb

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