UFCW Scrapes the Bottom of the Barrel

Holy Fucking Shit, UFCW:

I live in Pennsylvania. Almost all liquor sales, apart from a few places that can sell beer, are through a state monopoly of stores that employ 5000 union employees. The state-owned stores are inefficient, expensive and badly run. The state tried a hilarious experiment in wine kiosks a few years back. Not long after, they had a much-publicized effort to make liquor store employees friendlier.

Governor Corbett, in a rare display of intelligence, is supporting an effort to privatize these stores to one degree or another. And the union responded with … that ad above. It would also appear that they have their facts wrong.

I’ve seen some vile ads before but this one takes the cake. Well done, UFCW.

Comments are closed.

  1. Seattle Outcast

    Looks right in line with the shit they ran in WA state for a decade or so until they finally lost an election and they got the state out of the booze business.

    No government has any business being in business, any business, ever, at all.

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  2. stogy

    No government has any business being in business, any business, ever, at all.

    I disagree with this in one particular respect. There is something far worse than a government business monopoly, and that’s a private monopoly. National grids, railway tracks, tollways, water and sewerage services are usually cheaper, more efficient and have higher levels of investment under government bureaucracies than private ones.

    Just have a look at the mess private companies made of Britain’s rail services for a nice example. No investment, higher prices, still dependent on government subsidies, poor service, lack of integrated transport services and timetables, passenger satisfaction at all-time lows….

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  3. balthazar

    I disagree with this in one particular respect. There is something far worse than a government business monopoly, and that’s a private monopoly. National grids, railway tracks, tollways, water and sewerage services are usually cheaper, more efficient and have higher levels of investment under government bureaucracies than private ones.

    Wrong, its much easier to break up a private monoply than it is to stop a government run or ENDORSED (think NFL MLB etc) monopoly.

    BTW all those things you listed, are farmed out to private companies to run, by and large. So you are wrong again.

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  4. Xetrov

    National grids, railway tracks, tollways, water and sewerage services are usually cheaper, more efficient and have higher levels of investment under government bureaucracies than private ones.

    Here, let me fix that for ya –

    National grids, railway tracks, tollways, water and sewerage services are universally subsidized with your tax dollars, so they can appear to be cheaper, certainly not more efficient and have higher levels of investment thanks to your tax dollars under government bureaucracies than private ones.

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  5. stogy

    National grids, railway tracks, tollways, water and sewerage services are universally subsidized with your tax dollars, so they can appear to be cheaper, certainly not more efficient and have higher levels of investment thanks to your tax dollars under government bureaucracies than private ones.

    Rubbish. In many cases governments actually make money from government owned corporations. In other cases, subsidies are a necessary evil – particularly in the case of public transport.

    I am not arguing that governments are always better at running things, or even that they should. It’s just that in cases where private corporations can operate without competition, public corporations are almost always better.

    BTW all those things you listed, are farmed out to private companies to run, by and large. So you are wrong again.

    It depends on the country. But if you took the chronic underinvestment in the US power grid as an example… I would call that an own goal really. Not only does it push up prices but it means that very few of the efficiencies from smart grid development will ever get passed on to consumers.

    Higher emissions, lost jobs, billions lost from GDP, premature deaths. What’s not to love about such a policy?

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  6. Seattle Outcast

    National grids, railway tracks, tollways, water and sewerage services are universally subsidized with your tax dollars, so they can appear to be cheaper, certainly not more efficient and have higher levels of investment thanks to your tax dollars under government bureaucracies than private ones.

    “appear to be” is the operative phrase. There are numerous cases where private industry has proven to be cheaper, more efficient, and provide far better service than the corresponding government entity. There are a number of private roads (multi-lane expressways) that charge a toll to use: since they don’t rely on unionized government labor to build and maintain the road, they run at a profit yet cost less than similar roads built and maintained with tax dollars. Utility companies that compete against each other to provide services nearly always cost less and provide better service than government-run or government-granted monopolies.

    Of course, if you “privatize” something and ensure that it is so strictly regulated that it cannot be run efficiently or that investment is punished, then you merely have a government-run entity with misplaced blame for the disaster it becomes.

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  7. Seattle Outcast

    Just have a look at the mess private companies made of Britain’s rail services for a nice example. No investment, higher prices, still dependent on government subsidies, poor service, lack of integrated transport services and timetables, passenger satisfaction at all-time lows…

    Amtrak – that pretty much defeats your entire argument…

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  8. stogy

    Amtrak – that pretty much defeats your entire argument…

    Actually it doesn’t. It would if I was arguing that government is always better than private corporations. I’m not. There are tons of instances where privatization has resulted in better service and lower prices. But there are tons of examples of the reverse as well. Amtrak has always been bad. But privatization has damaged rail services in Britain. There is no guarantee that privatization of Amtrak would make it any better.

    This:

    No government has any business being in business, any business, ever, at all.

    ….is a rule that can have real negative economic, environmental and social impacts if applied unilaterally. That’s what I was arguing against.

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  9. stogy

    It’s easy for the government to “make money” when it’s subsidized through tax dollars. After all, they’ve done a terrific job with Amtrak. And GM.

    OK. So you choose some unprofitable industries where subsidies have been necessary. And that’s your argument. But some government corporations have been immensely profitable. Look at what the Australian government sold off in the 90s and 00s – Telecom, The Commonwealth Bank, Qantas, the airports… all or most were extremely profitable. Most Australians (I have family there) think that services have declined and become more expensive since privatization. You should hear my father in law on Telecom.

    Just look at the airports in Australia now. WIth the monopoly the buyers got, they were able to gouge the public on prices. – most expensive parking anywhere in the world. Shops clinging on in the face of large rental fee increases, passenger satisfaction very low. You have to walk right through a fucking duty free shop to get through customs. It’s a disgrace!

    Monopolies are bad. Private monopolies are often much worse.

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  10. balthazar

    You still dont get the main point. GOVERNMENT MONOPOLIES VERY RARELY IF EVER WILL BE BROKEN UP.

    Private monopolies end up pissing enough people off that they are forced to be broken up. Unless they are in the business of filling up the pockets of politicians.

    See MA Bell.

    See Standard Oil

    See America Tobacco

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  11. Xetrov

    OK. So you choose some unprofitable industries where subsidies have been necessary.

    Because…we’re talking about subsidies and government owned/run businesses. Did you want to talk about Susie’s lemonade stand instead?

    And that’s your argument.

    Technically my argument is that this statement from you –

    I disagree with this in one particular respect. There is something far worse than a government business monopoly, and that’s a private monopoly. National grids, railway tracks, tollways, water and sewerage services are usually cheaper, more efficient and have higher levels of investment under government bureaucracies than private ones.

    is Asinine.

    As for the rest of your response, I am only concerned with US Subsidies, US Government run companies, US Monopolies. I could give two tits about what Australia did or didn’t do. They are a separate country that operates under its own laws regarding business regulation, subsidies, and Government ownership.

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  12. Poosh

    I’m not too sure where this bullshit about how privation has damaged our trains and railways came from, absolute trash. The rail system, though far from perfect, is vastly superior to what it use to be. At any rate, the government STILL picks the winners when it comes to our railways so, and this has always puzzled me, market forces, etc. cannot actually come into play ( Especially for an island like the UK where land isn’t plentiful like in the Americas.). These are not private companies operating in the manner we are speaking of.

    The cost of public roads in the UK, at least, are a nightmare, the costs will shock you, They horrified me when I saw them.

    That being said certain areas, such as indeed transport and energy, are within the bracket, imo, that government should be observing. Why? Because if – if – these corporations et al frak up, then the consequences are faaaar more severe than with, shall we say for now, “private goods” such as a TV.

    As pointed out above, the true cost of these utopian government schemes, as usual, is hidden from people… though it *is* always cheaper if you’re using your betters as slaves via “progressive” tax ;) so it is cheaper… from a certain point of view.

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  13. Seattle Outcast

    OK. So you choose some unprofitable industries where subsidies have been necessary.

    How are they necessary?

    GM has plenty of competition, no shortage of cars out there. Of course, there were massive payoffs to the unions to be done – I suppose there were necessary as mobsters expect a return on their investment (corrupt politicians), but hardly necessary in an economic sense. Letting GM go on the auction block and get broken up piece by piece would have been a better outcome in the long run – if nothing else it would have shattered the union stranglehold on those operations and perhaps given them a real lease on life.

    Amtrak was the government response to an entire failed industry. The US does not travel by rail – why spend days on a train when can get there in hours on a plane for 1/3 the cost? Amtrak has run a net loss every year it’s been in operation – it will never even come close to breaking even. How is maintaining passenger rail service necessary?

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  14. stogy

    How is maintaining passenger rail service necessary?

    It may not be. Choosing the most unprofitable service provided by government doesn’t defeat my argument because that isn’t my argument.

    Governments have and should operate some services because it is in the interests of their constituents that they do so – there are often other factors at work. If there has to be a monopoly provider of a service, then I would generally prefer that governments operate it than private companies. Because at least with governments, there is some measure of accountability.

    The only reason why privatization “succeeds” in many cases is that government subsidies continue. Governments sell to their friends and party donors, and the public still picks up the tab. Perhaps rail is now different, in that the airlines defeat the monopoly, but not all Amtrak routes are unprofitable (particularly in the North-East). Do you think that service would actually improve in profitable routes if they were privatized, which some have proposed? It didn’t work in Britain. Shutting down unprofitable lines could mean that main lines that are profitable then don’t become profitable.

    I’m not too sure where this bullshit about how privation has damaged our trains and railways came from, absolute trash. The rail system, though far from perfect, is vastly superior to what it use to be.

    Really Poosh? I used to travel a lot by rail in Britain. The service clearly went down while prices went up. But don’t believe me – here’s what a new report found:

    Rail privatisation has left Britain with the most expensive fares in Europe, older trains, overcrowding, and operating companies entirely reliant on public subsidies, according to a hard-hitting report.

    The authors of the “Great Train Robbery” claim private train companies are heavily dependent on the public purse to enable them to run services, and re-invest little of their profits back into the railways. The TUC said the research by the Centre for Research on Social-Cultural Change (CRESC) at the University of Manchester showed privatisation failed to deliver for rail users and taxpayers and had brought in little private sector investment.

    According to the report, firms receiving the largest state subsidies spent, on average, over 90% of their profits on shareholder dividends. Train companies made operating profits between 2007 and 2011 of £504m, most of which was paid to shareholders, said the report. Meanwhile the average age of trains has risen from 16 years in 1996 to 18 years today. Just £1.9bn was spent on rolling stock between 2008 and 2012, compared to £3.2bn between 1989 and 1993.

    The report added that more than 90% of new investment in recent years has been financed by Network Rail and came mainly from taxpayer funding or government-underwritten borrowing.

    I remember that it became almost impossible to get information on train interchanges, simply because you were changing from one operating company to another. The whole thing was a complete mess.

    The cost of public roads in the UK, at least, are a nightmare, the costs will shock you, They horrified me when I saw them.

    Isn’t there only one new toll road in Britain, the M6? And a couple of toll bridges? I’m not sure what your point is? If you’re talking about the cost of construction, then are there any real differences between public and private projects?

    I could give two tits about what Australia did or didn’t do.

    The argument was “no government has any business…”. It’s not up to me to correct your myopia.

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  15. Seattle Outcast

    The only reason why privatization “succeeds” in many cases is that government subsidies continue.

    Here in the US the “subsidies” are generally (almost always) hold-overs from the great depression when we had our first taste of communism. Dairy prices are still set in large part by the government, and there still exist “farmers” that get paid to not produce anything. Many “subsidies” also come in the form of competition-crushing regulation or authorized monopoly. Of course, we all know how much better off we were under ‘Ma Bell and that nobody could ever compete against the US Postal Service. Also, cable companies and utility companies always offer better services and price when the local government has pushed out the competition.

    Amtrak is the least of the examples I can drag up in a moment’s notice to oppose your theory.

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  16. Xetrov

    I could give two tits about what Australia did or didn’t do.

    The argument was “no government has any business…”. It’s not up to me to correct your myopia.

    You keep missing my argument, though you’ve tried to define it twice now. That’s not a quote from me, so perhaps it’s your myopia.

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  17. Poosh

    Really Poosh? I used to travel a lot by rail in Britain. The service clearly went down while prices went up.

    Oh you said so, that settles it then….

    But at any rate. as is clear from the totally not suspect website WALES ONLINE, clearly we’re not dealing with privatisation here, a real free market, in fact we’re dealing with what right wingers constantly warn about. Ergo NOT an example of what people are talking about here. But even still the trains have got better. The mere idea that they did not is as absurd as saying the internet over here has not got better. Again, are things really *cheaper* when money is being stolen by X and not taken from the actual users? (Which is actually what’s happening again now anyway…)

    And reports have found that British rail is both the most expensive AND the cheapest in Europe.

    And yes, there are MASSIVE differences between the construction of roads between private and public. I’m sure anyone can find them if they have some free time, and can see the absurd costs of public roads of recent times in the UK, truly shocking. Then compare with private roads. *not that I support private roads, I don’t.

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  18. Iconoclast

    Because at least with governments, there is some measure of accountability.

    You cannot be serious — government bureaucracy epitomizes the utter lack of accountability. To whom are government bureaucrats allegedly accountable? Voters?? The electorate?? Their supervisors?? No, government workers aren’t generally considered to be accountable to anyone, and getting oneself canned from a government job is generally hard to accomplish. My first job in IT was for a County government, and the two things I remember most was 1) I had to join a union as a condition of employment, and 2) it took an act of God to get someone terminated. I was young and dumb at the time, and simply wanted to get my career started, so I didn’t think anything of it, but now it seems rather obvious that the two were connected. And if your job security is such that the worst you could do in practice is not get promoted, there is really not much incentive to bother doing a good job, and trust me, the software source code I had to maintain was ample evidence of that.

    The only reason why privatization “succeeds” in many cases is that government subsidies continue.

    You seem to have put scare quotes around the wrong word. It should read:

    The only reason why “privatization” succeeds in many cases is that government subsidies continue.

    Now it makes sense. It ain’t really “privatization” if government subsidies are involved. Quite the contrary. A truly private enterprise sinks or swims according to market forces and the enterprise’s ability to adapt to those forces. Propping it up via subsidies makes it somewhat immune to market forces, hence the diminishing of quality service or product. If you don’t have to compete, you don’t have to produce a superior product or service for a given price point.

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  19. stogy

    Propping it up via subsidies makes it somewhat immune to market forces, hence the diminishing of quality service or product.

    OK. So no subsidies. The city train service collapses in debt as branch lines are closed and the main lines become unprofitable, bus prices go up, people can’t get to work. Roads are clogged. Employers and retailers are unhappy – as customers can’t get to the stores and employees on minimum wage can’t get home. People vote instead for the party that promises not to damage the economy with fundy economic nonsense.

    You keep missing my argument, though you’ve tried to define it twice now. That’s not a quote from me, so perhaps it’s your myopia.

    Well that’s the point I am arguing against. I can’t be responsible for your lack of concentration.

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  20. stogy

    But at any rate. as is clear from the totally not suspect website WALES ONLINE,

    Oh for fuck’s sake, Poosh. It was fairly widely reported across British media – hardly just Wales online.

    I also saw it in the Guardian and ITV. It even made it into the Austrian Tribune.

    The irony of your point is that train travel per km in Wales is somewhat cheaper than in England…

    And reports have found that British rail is both the most expensive AND the cheapest in Europe

    If you are referring to the seat61 study, then that’s certainly true – it really depends on how and when you are travelling. Here’s the succinct quote from the Independent:

    Rail expert Mark Smith, who founded the seat61.com website, said: “The UK is more aggressively commercial than other railways, and has both higher fully flexible fares for business and lower leisure advance fares. Most other European operators are following in our wake. But true, none go up to levels as high as ours at the top end.

    The issue here is that even with “privatization” (there you go, I moved the quotation marks), pretty much all of the investment in the rail sector is still being paid for by the taxpayer. And that’s with some of the highest train fairs in Europe. Has privatization benefitted the British taxpayer? Probably not.

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  21. Seattle Outcast

    If it is running primarily off of tax money, then it isn’t a private enterprise.

    What it is in all actuality is a payoff to someone in the manner of “I help you get elected by not releasing these pictures of you screwing an underage girl in the ass while your wife holds her down for you, and you let me run the trains from now on. And make sure I get paid quite well regardless of what happens.”

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  22. Iconoclast

    OK. So no subsidies. The city train service collapses in debt as branch lines are closed and the main lines become unprofitable…

    If they were previously being propped up by subsidies, they never were profitable.

    …bus prices go up, people can’t get to work. Roads are clogged. Employers and retailers are unhappy – as customers can’t get to the stores and employees on minimum wage can’t get home.

    You are being somewhat schizophrenic with your hypotheticals — either there is a viable market for rail service or there isn’t, but your scenario implies both at the same time. If properly managed, there is no reason for rail service to be unprofitable if the only alternative to rail is “bus prices go up, people can’t get to work…customers can’t get to the stores and employees on minimum wage can’t get home”. If there is demand for rail service, as you seem to be implying, then a shrewd businessman should be able to provide such service and make decent money at it, without government subsidy. If government subsidy is absolutely required to prop up the rail service industry lest it go belly up, then that strongly suggests that the demand for said service simply ain’t there. If there is strong demand for rail service, but it simply isn’t possible to provide such service at a reasonable price while making a decent profit, then something else is going on, most likely excessive government regulation of the industry.

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  23. Poosh

    Widely reported at the Guardian and BBC woooooooop.

    From a “study” at a university, That magically makes it fact..

    there you go, I moved the quotation marks

    That’s a pretty cheap and snakey way of trying to get away from things, isn’t it? You know perfectly well the aboves are talking about actual free market privation without a hand in the tax-payer jar or government picking who gets what up the the butt say what up the butt. You know perfectly well its a fundamental distinction, At any rate the trains ARE better, it’s not worth discussing it really isn’t. It’s like the idiots who think the phones were better when the state owned them, you’re just flat out lying or using selective memory.

    But the bottom line is, I have always felt this, could the UK ever have actual private railways? I do not think so purely because of the lack of land.

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  24. Poosh

    If there is demand for rail service, as you seem to be implying, then a shrewd businessman should be able to provide such service and make decent money at it, without government subsidy.

    Blam. Right there.

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  25. Xetrov

    OK. So no subsidies. The city train service collapses in debt as branch lines are closed and the main lines become unprofitable, bus prices go up, people can’t get to work. Roads are clogged. Employers and retailers are unhappy – as customers can’t get to the stores and employees on minimum wage can’t get home.

    What a random unsupported supposition. No more (largely unused and subsidized) rail service, so bus prices go up as a result. WTF? You might as well try to blame Obama’s Syrian war on no subsidized rail service as well.

    I can’t be responsible for your lack of concentration.

    But you can be held responsible for your complete lack of a rational argument.

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  26. stogy

    But you can be held responsible for your complete lack of a rational argument.

    I guess you’ve been following the argument from the beginning, so I will keep it really simple so that you can catch up. See here’s how private companies work. They will charge a price that will generate the highest profit for them. Without competition, the price of private bus services will rise, and quality of service will fall corresponding with the lack of need to invest in new services (no competition means companies don’t have to try to keep things nice to attract customers). Cut back on cleaning and maintenance services to increase profits. Late night and early morning services decline. And wella! You have an unaccountable private monopoly. I don’t expect private companies to operate as charitable organisations – I expect them to act in their own interests, and their customers’ interests only insofar as it supports their profit margins. As an example, here’s a company that lowered their prices and improved services in response to increased competition.

    Pretty simple so far, eh? (I’m not Canadian, just in case you were wondering).

    Governments in charge of monopolies are at least accountable through the electoral system. Higher priced services generate an electoral backlash. Unless you are blind to what has happened in Brazil over the past few days, you’d know that it all started over bus fares.

    These are your free market principles (and mine for that matter). They don’t work in situations where there has to be a monopoly, because the basic principles of a free market system mean that companies will do what they should do, which is to make maximum profits. If competition can be assured, and services, and subsidies will become better under privatisation, then yes. That’s great. But often they don’t. This is partly because both left and right wing governments sell off businesses to their friends, and keep subsidies in place (partly as an assurance to the public that investment in services will continue).

    The US grid remains a great example of how these principles fail to generate social goods through lack of competition (aka a monopoly).

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  27. Xetrov

    I guess you’ve been following the argument from the beginning, so I will keep it really simple so that you can catch up.

    No need to catch up, you’ve still failed to present a rational argument. Your supposition that bus prices will rise without rail competition fails to prove two points necessary for that assumption to be valid. First – that rail routes are any sort of competition for buses, and second – that no one else will start up another, cheaper, more competitive busing company. Or start up a competitive rail company because the demand is there. It’s like you’re of the belief that there are a finite number of companies in the world, and nobody could possibly start another one based on a more sound business model than the one the overpriced busing company in your hypothetical example is using.

    Governments in charge of monopolies are at least accountable through the electoral system.

    That’s wrong on so many different levels, clearly demonstrated by the fact that the current congressional performance rating is in the teens and has been there more or less for years, and yet the re-election rate for Congress is over 90%.

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  28. stogy

    Your supposition that bus prices will rise without rail competition fails to prove two points necessary for that assumption to be valid. First – that rail routes are any sort of competition for buses, and second – that no one else will start up another, cheaper, more competitive busing company.

    The point isn’t about rail per se, but simply about lack of competition regardless of what form it takes. And if there were a new, cheaper bus company, then it wouldn’t be a monopoly, and therefore would not satisfy the conditions for the argument I am making. I am only arguing that where competition is not possible, a government monopoly is better than a private one. Continually misunderstanding this is not helping your argument.

    A better approach for you, if you do really want to attack this argument, would be to show that competition is always possible – even in the case of an electrical grid (where you can’t have two separate competing grids delivering power to houses).

    That’s wrong on so many different levels, clearly demonstrated by the fact that the current congressional performance rating is in the teens and has been there more or less for years, and yet the re-election rate for Congress is over 90%.

    I’m sorry. I wasn’t aware of the role of congress in setting bus fares. You may well be right.

    I’m pretty much done with this. But I think I have an example that we can both agree on. In Georgia, the Tea party have joined with environmentalists to bring down a private (but government mandated) monopoly on power generation. The environmentalists want to allow consumers to switch to alternative modes of power generation – in particular solar, and the tea party want more choice in the market, regardless of whether it is solar, and are questioning the massive, wasteful construction costs of a nuclear power plant.

    It’s a private company focused on maintaining its monopoly regardless of the needs or wishes of its consumers, using its weight to prop up its own prices and buy the political influence to ensure its monopoly.

    Government-run monopolies (but only where necessary) are unlikely to have such corrupting influences.

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  29. stogy

    Iconoclast, you said:

    If government subsidy is absolutely required to prop up the rail service industry lest it go belly up, then that strongly suggests that the demand for said service simply ain’t there.

    That’s true, but you ignore the other factor in demand, which is the ability of people to pay for a service. People in poorer areas may need public transport far more than those in wealthier areas, but have much more limited means to pay. And moving to higher priced areas is hardly likely to be an option. There’s also the need for services at odd hours. Both result in services that may not be profitable but still could be vital to economic functioning.

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  30. Xetrov

    The point isn’t about rail per se, but simply about lack of competition regardless of what form it takes.

    So let me get this straight…Your own example doesn’t hold up to scrutiny when confronted by logic and common economic principles, so let’s ignore it and try a different track…Yup, that about sums up your first paragraph.

    I’m sorry. I wasn’t aware of the role of congress in setting bus fares. You may well be right.

    You were the one who used the rationale that government in its current form is held accountable so government monopoly’s are ok. Not my fault your rationale had a fatal flaw.

    Since you’re apparently done with the conversation, I’ll just restate that your original position that government runs businesses “cheaper” than private industry while ignoring the massive subsidies that allow it to appear to do so is asinine at best.

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  31. Iconoclast

    That’s true, but you ignore the other factor in demand, which is the ability of people to pay for a service. People in poorer areas may need public transport far more than those in wealthier areas, but have much more limited means to pay.

    Actually, I’m not ignoring anything; determining whether a service can be offered at affordable prices is an inherent part of determining whether there is a viable market. It is a given that there will always be a demand for free (or unrealistically cheap) goods and services, but that is ultimately irrelevant. If you cannot provide a service at prices that are actually affordable in a given marketplace, then there simply is no viable market.

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  32. stogy

    I’ll just restate that your original position that government runs businesses “cheaper” than private industry while ignoring the massive subsidies that allow it to appear to do so is asinine at best.

    Heh.. I like that. I think the winner’s pin should go to you. I simply don’t have the ability to construct such nice straw men.You’ve restated my position in a way that is completely unrecognisable. The argument I made was that a government monopoly is better than a private one, in situations where only a monopoly is possible.

    But instead of arguing against this, you and others here have been arguing that unsubsidised, private companies are better. I completely agree with this. There is no daylight between our positions. If a private company can run a service cheaply and profitably without subsidies, then great. But it is unlikely to provide a good service at low prices if there is no competition in the marketplace. This is economics 101. I agree with this. You should agree with this.

    Subsidies for private business distort the market, create dependency and ultimately corrupt governments (just look at how strongly the oil industry has fought to keep its snout in the government trough). Football stadiums, farms, commercial ports likewise should not get subsidies. Again I don’t think there will be much disagreement here.

    You are free to disagree with this though: I do support subsidies for government provided services where other economic and social factors need to take precedence (e.g. special needs, low-income pensioners, community safety, support for other areas critical to development, such as research). If a government has to pay for an unprofitable late night bus service to get people home from shift work in a dangerous area where people are providing vital local services, then I am all for it.

    Now in situations where no competition is possible at all – like an electricity grid, a single airport in a large area. How do you ensure competition, investment and low prices? Privatization, and there are multiple examples above, generally does the exact opposite of this. Remember that governments often run these services as profitable corporations – they are not always loss-making, subsidy hungry monoliths.

    Actually, I’m not ignoring anything; determining whether a service can be offered at affordable prices is an inherent part of determining whether there is a viable market.

    If there is a viable market, then there is no need for a monopoly, and therefore it doesn’t meet the criteria for the argument (“in situations where only a monopoly is possible”). Monopolies generally exist in non-viable markets. The argument would then be either to shut the service down or to continue it because it provides support for some other aspect critical to social or economic development.

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  33. Iconoclast

    Governments have and should operate some services because it is in the interests of their constituents that they do so – there are often other factors at work.

    This isn’t necessarily correct — it would be more accurate to say that “it is in the interests of some of their constituents that” Governments provide services. It certainly isn’t in the interests of those actually footing the bill (the taxpayers) if they aren’t actually using the service.

    If there is a viable market, then there is no need for a monopoly, and therefore it doesn’t meet the criteria for the argument (“in situations where only a monopoly is possible”).

    I don’t believe you ever made a compelling argument that there is ever a “need for a monopoly”, only the desire for one. Overall, it appears that you are arguing that governments are obligated to waste taxpayer money, in that they are obligated to provide services to those who cannot afford them, services that would normally be provided by a private enterprise. IOW, you seem to be arguing that governments are obligated to operate monopoly businesses at a loss, with taxpayers footing the bill.

    That may be a fundamental tenet of progressivism (government is obligated to provide specific services to the so-called “poor”, or to society at large), but that doesn’t make it true. It can be argued that non-profit private firms would provide better service at any rate. Consider, government simply forces taxpayers to fork over the funds needed to build and operate a service, which is ultimately run and administered by government bureaucrats , who are not accountable to voters, or even taxpayers. Once the bureaucracy to administer a service is set up, it is basically impossible to ever get rid of it, even if said service is no longer in demand. Furthermore, it has a tendency to simply grow, soaking up more taxpayer revenues in the process, without providing better service. We can point to any number of federal departments as examples, such as the Department of Education. That federal agency spends billions every year, and our student simply don’t benefit at all.

    OTOH, a private non-profit has to rely on donations to stay afloat, and to obtain donations, it has to at least maintain an image of being worthy to receive donations. Part of that may very well be the type, and quality, of services being rendered. If donations stop coming in, the enterprise has little choice but to shut down. At any rate, it sharply contrasts with government bureaucracy, which continues to soak up taxpayer funds essentially forever, regardless of quality of service, regardless of levels of demand.

    If there has to be a monopoly provider of a service, then I would generally prefer that governments operate it than private companies. Because at least with governments, there is some measure of accountability.

    This is simply an article of misplaced faith. As I have said before, government bureaucrats are generally not accountable. Look at all of the recent scandals here in the USA. Has anyone actually been disciplined? Hillary is no longer Secretary of State, but what actual penalty did she pay for Benghazi, for which she took “full responsibility”? She may no longer have that job, but she is still set for life, and there is talk of her being our first woman President come 2016.

    Does that look like accountability to you?

    And what about all of the other un-elected minions involved with PRISM, the IRS scandal, and so forth? Sure, there may be some symbolic sacrificial lamb, maybe, but for the most part, it will simply be business as usual…

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