Pirates Profiteers and Privatizers by Thomas Ultican

By Thomas Ultican 12/21/2021

Ronald Reagan claimed the nine most terrifying words in the English language are “I’m from the government, and I’m here to help.” The new book, The Privatization of Everything, documents the widespread theft of the commons facilitated by Reagan’s anti-government philosophy. His remark echoed a claim from the “laissez-faire cheerleader” Friedrich Hayek that government has us all on the “road to serfdom” (Privatization 120). Sherrilyn Ifill, the former Director-Council of the NAACP Legal Defense Fund observed,

“What we’re seeing in our country today: the rhetoric, the hate, the ignorance, the coarseness, the vulgarity, the cruelty, the greed, the fear is the result of decades of poor citizenship development. It is a reflection of the fully privatized notion of citizenship, a feral conflict for the scraps left by oligarchs (Privatization 13).”

Libertarian politicians like former speaker of the house Paul Ryan and Senators Ron Johnson and Rand Paul claim Hayek and writer-philosopher Ayn Rand as their guiding lights. In a 2012 article, Politico reported, “…, to bring new staffers up to speed, Ryan gives them copies of Hayek’s classic “Road to Serfdom” and Rand’s “Atlas Shrugged” — books he says inspires his political philosophy.” Politico also stated,

“But Hayek and Rand were violently opposed to each other’s ideas. It is virtually impossible to hold them in the same brain. When the termagant Rand met Hayek, she screamed across the room, ‘Compromiser!’ and reviled him as an ‘abysmal fool,’ an “ass” and a ‘totally, complete, vicious bastard.’”  (Termagant: a violent, turbulent, or brawling woman.)

Ayn Rand’s problem with Hayek was that he was not really the “laissez-faire cheerleader” he was purported to be. He certainly opposed many of the ideas emanating from Franklyn Roosevelt’s New Deal believing they would lead to worse problems than the ones being addressed. Fundamentally his thinking was shaped by a fear of communism. However, unlike today’s libertarians, he was not opposed to all government programs or interventions and that is what stirred Ayn Rand’s fury.

Robert Nielsen’s 2012 review of Hayek’s The Road to Serfdom observes,

“He also calls for social insurance in case of sickness and accident, as well as government assistance after a natural disaster. ‘But there is no incompatibility in principle between the state providing greater security in this way and preservation of individual freedom.’ I think most advocates of Hayek have not read this passage and don’t realise he is not an extremist arguing against all forms of government. Let me repeat this, Hayek is arguing there is a good case for the government to get involved in healthcare, either in the form of universal healthcare or government insurance.”

John Maynard Keynes is thought of as the liberal economist whose theories guided President Roosevelt as he grappled with the great depression. Hayek’s and Keynes’s economic theories were in some ways polar opposites. However, Hayek came to London to work at the School of Economics where he and Keynes who was 16-years his senior became friends. They exchanged several letters concerning Hayek’s works in which Keynes found some agreement.

Chet Yarbrough’s audio book review of The Road to Serfdom states,

“Contrary to a wide perception that John Maynard Keynes (a liberal economist in today’s parlance) denigrated ‘The Road to Serfdom’; Keynes, in fact, praised it.”

“Though Keynes praised ‘The Road to Serfdom’, he did not think Hayek’s economic’ liberalism practical; i.e. Keynes infers that Hayek could not practically draw a line between a safety net for the poor, uninsured-sick, and unemployed (which Hayek endorsed) while denying government intervention in a competitive, laissez-faire economy.”

It is disingenuous to cite the theories of Friedrich Hayek as the justification for privatizing government functions and the commons.

The Privatization of Everything

The Privatization of Everything co-author Donald Cohen is the founder and executive director of In The Public Interest. Co-author Allen Mikaelian is the bestselling author of Metal of Honor and a doctoral fellow in history at American University. Besides the authors’ individual work, the team at In The Public Interest contributed significantly to the book with research and documentation.

Of their intention in writing the book, the authors state,

“Our approach is both idealistic and practical. We want readers to see the lofty values and big ideas behind the creation of public goods, and we want readers to feel empowered to question those values and introduce new ones. We want to help change the conversation, so we can stop talking about ‘government monopolies’ and return to talking about public control over public goods (Privatization 19).

They detail several cases showing the downside of the government being forced to give control over to private business. In this era of human-activity-induced climate change, what has been happening at the National Weather Service (NWS) is instructive.

In the 1960s, President John F. Kennedy believed that the US and the Soviet Union could find a field of cooperation in supporting the World Meteorological Organization. As a result, 193 countries and territories all agreed to provide “essential data” on a “free and unrestricted basis.” “Each day, global observations add up to twenty terabytes of data, which is processed by a supercomputer running 77 trillion calculations per second (Privatization 267).”

The book notes, “In the 1990s, at about the same time that forecasting got consistently good, private interests and free-market absolutists started insisting that the NWS and related agencies were ‘competing’ with private enterprise.” Barry Myers, head of AccuWeather was loudly accusing the government of running a “monopoly.” He went to the extreme of calling for the government to get out of the weather predicting business which made no sense since AccuWeather is completely dependent on NWS predictions. (Privatization 268)

After a killer tornado in 2011, NWS employees proposed a smart-phone app to better inform the public. The author’s report, “… this ultimately took a backseat to Myers’s insistence that his AccuWeather apps shouldn’t face ‘unfair’ competition (Privatization 270).” To this day, NWS has no smartphone app.

Weather forecasts are pretty good for up to a week but after that as time passes they become more and more useless. The models for predicting the weather are highly dependent on the preceding day and the farther you get from accurate data for that day the more error invades the predictions. NWS restricts its predictions to a one-week time-frame but AccuWeather and the Weather Channel in order to attract customers provide meaningless 2-week up to 90-days predictions. (Privatization 272)

Extreme weather events are life threatening. The authors state,

“The NWS’s mission includes saving lives. The business model of corporations like AccuWeather includes saving lives of paying customers only (Privatization 273).”

There are many episodes like NWS detailed. In the section on private prisons, we read about such atrocities as the Idaho correctional facility known as the “Gladiator School” (Privatization 140). When detailing the privatization of water we are informed of Nestles CEO, Peter Brabeck stating how extreme it was to believe that “as a human being you should have a right to water (Privatization 54).”

Privatizing Public Education Stabs Democracy in the Heart

The First Public School in America

Boston Latin School was founded April 23, 1635. America’s first public school only accepted boys for their curriculum centered on humanities including the study of Latin and Greek. Its more famous revolutionary-era students were Samuel Adams, John Hancock and Benjamin Franklin. These revolutionary thinkers who gave America democracy were educated in a public school and would latter agree that free public schools were necessary to a functioning democracy.

When Betsy DeVos was calling for vouchers and charter schools, she was implicitly demanding public dollars support religious schools that would not accept transgender students or homosexual teachers. She wanted schools free to teach a doctrine of science denial and religious bigotry. “Freedom of choice in this case meant the freedom to discriminate, with the blessing of public funds (Privatization 210).”

One of the several disturbing stories about the menace of privatizing schools comes from Reynolds Lake Oconee, Georgia. Wealthy real estate developer Mercer Reynolds III made a charter school the center of his community development. The charter school application called for 80% of the children to come from Reynolds properties. The other 12% would go to students in nearby wealthy white communities and the remaining 8% would go to countywide residents. (Privatization 211-212)

With a mix of taxpayer and private funding, Reynolds built an impressive school. It had a piano lab with 25 pianos, a pond and offered 17 AP classes. The school is 73% white. The nearby public school that is 68% black and would never dream of a piano lab has seen the Reynolds school continually siphon off more of their students. They have been forced into laying-off staff and tightening budgets. (Privatization 212)

Cohen and Mikaelian concluded,

“This was a clear-cut case of rich whites diverting money from struggling black families in order to further push them to the margins. And they used the ideas of school choice and free market to justify it.

As the book makes clear, every time a public good is privatized the public loses some of their democratic rights over that lost good. This is a powerful book that everyone should read. In the last chapter the authors call out to us,

“We can’t let private interests sell us public goods as consumers, because the free market can’t avoid creating exclusions. School choice quickly devolves into segregation. Public parks and highways are divided into general versus premium services. In the midst of a notional health crisis, ventilators go to the highest bidder.”