We’ve been through this before—well, something approximating this.
In the midst of the 2008 financial crisis, as millions of people lost homes and public budgets tightened, the chairman of a financial firm specializing in infrastructure privatization spoke his mind.
“Desperate government is our best customer,” he said at the annual meeting of the National Council for Public-Private Partnerships. “There will be a lot of desperate governments out there.”
Unfortunately, he was right. Corporations and Wall Street pitched privatization of public services and infrastructure to state and local governments with astonishing success. School districts, municipal water departments, and public universities from coast to coast recklessly outsourced employees. Chicago sold off its downtown parking meters for at least a billion dollars under value. Arizona sold its legislative and court buildings only to rent them back.
There were so many instances of privatization gone wrong that many policy makers realized that privatization is just wrong in the first place. New York City brought IT services back in-house to save money. Fort Wayne, Indiana, took over the management of its snowplow trucks, police cars, and other vehicles to improve service quality.
Yet, here we are again—and now the stakes are much higher. During the peak year of the Great Recession, states faced a collective shortfall of more than $220 billion. So far, only a month and a half into a crisis with no end in sight, governors say they need $500 billion. Senate Majority Leader Mitch McConnell is even saying he favors allowing states to declare bankruptcy rather than bailing them out.
Corporations and wealthy private investors are sure to be preying on desperate governments in the coming months. It’s up to all of us, together, to stop them.
That’s why we’ve produced two checklists for monitoring privatization threats. One focuses on the growing threat posed by for-profit online education corporations. The other is more general, raising alarms about budget cuts, emergency actions, and corporate maneuvering.
Do you know of any privatization schemes brewing in your school district, city, or state? Let us know.