Mounting evidence that privatizing public services costs us more money

[Cigar]

The private sector has had a very bad month. Its most widely publicized failure occurred when UPS and FedEx fumbled their Christmas deliveries while the U.S. Postal Service scored a touchdown.

“An unlikely Star of the Holiday Shipping Season: The U.S. Postal Service” is how Business Week described the clear victory of the public over the private. “The government-run competitor was swamped with parcels just like UPS and FedEx were, with holiday package volume 19 percent higher than the same period late year. But there were no widespread complaints about tardy deliveries by USPS. The postal service attributes its success to meticulous planning.”

Less publicized but even more damning has been the spate of articles regarding the epidemic of snafus and high costs of private contractors . A recent Op Ed in the New York Times by David A. Super, Professor of Law at Georgetown University offered a litany of private contractor failings, including a flawed Colorado Benefits Management System that took four years to fix. When first implemented it reportedly refused food stamps to anyone who did not have a driver’s license from Guam! In mid October a contractor’s glitch made food stamps inaccessible to recipients in 17 states.

Then there was what the Times deemed a “disastrous rollout” of a privately created and managed system to oversee unemployment benefits in Florida by Deloitte Consulting. In December Florida penalized the contractor $6 million and begin fining it $15,000 a day until the problems are fixed. Privately managed systems from Massachusetts to California have experienced dramatic delays and enormous cost overruns. ............................(more)

The complete piece is at: http://onthecommons.org/magazine/its-been-very-bad-month-private-sector#sthash.lNffQmC4.dpuf

Let the denial begin ...

[monty1]

Who needs evidence? Anybody who has fallen for that scam should be ashamed of themselves. Good government can always do it cheaper and better. the problem is, the US has corrupt and dysfunctional government.

[The Xl]

The government can't even run a healthcare website correctly.

[Mini Me]

All these private prisons Rethugs are building are the biggest threat to our freedom, besides the NSA.

The danger is tougher laws that jail people for victimless crimes to fill the prisons for profit. Inmates build stuff for industry to sell at windfall profits, and exploit the inmates and only pay them 50 cents per hour!

Sounds just like Red China to me!

[Peter1469]

Some things are more suited to the private sector, others to government (or at least a public-private partnership).

[patrickt]

Who needs evidence? Anybody who has fallen for that scam should be ashamed of themselves. Good government can always do it cheaper and better. the problem is, the US has corrupt and dysfunctional government.

Now that's funny. The IRS loses billions a year on taxes that aren't collected and on bogus refunds that shouldn't be made and they have around $70,000,000 in a slush fund for the rollout of Obamacare and it's gone and they don't know where.

Medicare and Medicaid fraud and mismanagement are legends.

Public schools do a crackerjack job at a much, much lower cost than private schools, don't they?

I'm sure the government does something really well. It's early and I can't think of anything now but I'll work on it.

[zelmo1234]

Who needs evidence? Anybody who has fallen for that scam should be ashamed of themselves. Good government can always do it cheaper and better. the problem is, the US has corrupt and dysfunctional government.

Actually the can't they can just do it and run deficits that would cause business to go bankrupt!

http://finance.yahoo.com/blogs/daily-ticker/time-u-postal-finally-run-money-152905402.html

So if they were a private business they would not have been able to meet payroll and would have been done?

[kilgram]

The government can't even run a healthcare website correctly.
Is it fault of the government? In part yes. But, was it externalized to a company to do the website? It is a very common practice, that I don't know if it was. But if it was, then we are talking about a privatization.

But there are governments that do very well, much better than the private counterpart those things.

The performance of a service is not necessary to be better in a private service. Depends on many factors. Many times the private service has the advantage that it is private, it means, it gives service to a more reduced group of people, it makes them to look better.

We are seeing for example in Spain how the privatization leads to more expensive costs for the "client". Let's start from the electric companies, telecommunications, and also the garbage recollectors of the towns (that are being renationalizated) or the healthcare topic. Spanish healthcarewas considered one of the third most efficient systems of the world. And it is entirely public (well was). Now we are seeing how the system is degradating, for example in Valencia the service is much worse than before the privatization.

[Common]

Privitized prisons are failing in some areas of the country, law suits are through the roof and some private prison corps are abandoning their contracts because they are losing money.

I believe some things can be run privitized efficiently as long as there is a mechanim to cap the propensity for pigginess but for the most part people that believe "ADDING" profit to anything makes it cheaper are naive or run around with Rand Paul signs

I am trying to find an article I read a few weeks ago about a Public hospital that closed its laundry and privitized it, it worked for about two years then the company insisted on huge surcharges in payment due to high fuel costs for pickup and delivery of the laundry and other costs. The hospital vacated the contract and opened their laundry up again.

[Ivan88]

When you hire thieves, thugs and liars to run things, you are going to get robbed.

When you have adulterated the Law, Justice, Language, Culture, Truth, Mercy and Faith, you deserve to get robbed.
5356

[patrickt]

Is it fault of the government? In part yes. But, was it externalized to a company to do the website? It is a very common practice, that I don't know if it was. But if it was, then we are talking about a privatization.

But there are governments that do very well, much better than the private counterpart those things.

The performance of a service is not necessary to be better in a private service. Depends on many factors. Many times the private service has the advantage that it is private, it means, it gives service to a more reduced group of people, it makes them to look better.

We are seeing for example in Spain how the privatization leads to more expensive costs for the "client". Let's start from the electric companies, telecommunications, and also the garbage recollectors of the towns (that are being renationalizated) or the healthcare topic. Spanish healthcarewas considered one of the third most efficient systems of the world. And it is entirely public (well was). Now we are seeing how the system is degradating, for example in Valencia the service is much worse than before the privatization.

When the government gives a no-bid contract to a company associated with the First Lady's college roommate...what do you expect?

And, I'm sorry but I haven't thought of anything the federal government does well. I'll keep working on it.

[Captain Obvious]

Good government

http://www.thefreedictionary.com/oxymoron

[Chris]

Who needs evidence? Anybody who has fallen for that scam should be ashamed of themselves. Good government can always do it cheaper and better. the problem is, the US has corrupt and dysfunctional government.

Provided there was such a thing as good government.

So, yes, I'd like evidence that private sector failures cost the tax payers anywhere near as much as the failure we call the USPS.

[monty1]

Now that's funny. The IRS loses billions a year on taxes that aren't collected and on bogus refunds that shouldn't be made and they have around $70,000,000 in a slush fund for the rollout of Obamacare and it's gone and they don't know where.

Medicare and Medicaid fraud and mismanagement are legends.

Public schools do a crackerjack job at a much, much lower cost than private schools, don't they?

I'm sure the government does something really well. It's early and I can't think of anything now but I'll work on it.

Yes, work on it and work on reading and understanding what I said. A hint: it's got something to do with the US gov being corrupt and dysfunctional. Then we can talk about government run health care or maybe B.C., Canada's car insurance that is head and shoulders above the private ripoff artists and their 'for profit' insurance schemes. Or a few other good examples if you prefer?

[Mr. Freeze]

Provided there was such a thing as good government.

So, yes, I'd like evidence that private sector failures cost the tax payers anywhere near as much as the failure we call the USPS.

The US Postal Service runs quite well, actually. Were it not for Congress mandating how it runs its retirements this would not be an issue. They are one of the few branches of government whose accounts run at a profit.

It is also an agency with close to 300 years of trial and error. UPS and Fedex piggy back in large part off of the postal service and had to buy addresses from the postal service. There are many government agencies which I think are absolute shit, but I will acknowledge the postal service is not one of them.

[Chris]

Earlier: "Good government can always do it cheaper and better."

Now: "A hint: it's got something to do with the US gov being corrupt and dysfunctional."


Make up your mind.

[Chris]

The US Postal Service runs quite well, actually. Were it not for Congress mandating how it runs its retirements this would not be an issue. They are one of the few branches of government whose accounts run at a profit.

It is also an agency with close to 300 years of trial and error. UPS and Fedex piggy back in large part off of the postal service and had to buy addresses from the postal service. There are many government agencies which I think are absolute shit, but I will acknowledge the postal service is not one of them.



But then it isn't running well by the simple fact it is a government agency run by the government. Take away some of its monopoly and it would fail straightaway.

[Mr. Freeze]

But then it isn't running well by the simple fact it is a government agency run by the government. Take away some of its monopoly and it would fail straightaway.

If you were take away it's monopoly Fed Ex and UPS would have failed early on as it simply is cost prohibitive to research every house in America. They bought addresses and continue to buy carrier assistance from the Post Office.

Two hundred years ago, yes, you'd be correct. This century, no. The PO was already well established.

Edit:
But then it isn't running well by the simple fact it is a government agency run by the government.

Huh?

[monty1]

Earlier: "Good government can always do it cheaper and better."

Now: "A hint: it's got something to do with the US gov being corrupt and dysfunctional."


Make up your mind.

You quote me saying 'good' government. You're really not very good about this debating thingy are you.

[Chris]

If you were take away it's monopoly Fed Ex and UPS would have failed early on as it simply is cost prohibitive to research every house in America. They bought addresses and continue to buy carrier assistance from the Post Office.

Two hundred years ago, yes, you'd be correct. This century, no. The PO was already well established.

Edit:

Huh?

You yourself said it was failing because of Congressional control.

Its monopoly is in delivery personal mail. Take that away, the way email and messaging has, and it fails.

How would it ever succeed without a profit motive and competition to innovate?

[Chris]

You quote me saying 'good' government. You're really not very good about this debating thingy are you.

And your ad hom is unimpressive. It doesn't cover up your self-contradictions.

[Mr. Freeze]

You yourself said it was failing because of Congressional control.

I should be more clear then. The last several PMGOTUS have run the service at such a high level of efficiency had Congress not mandated how they provide for pensions the USPS would run as well as any private business.

It is external influence that is the problem, not how the department runs itself.




Its monopoly is in delivery personal mail. Take that away, the way email and messaging has, and it fails.

How would it ever succeed without a profit motive and competition to innovate?

Define success. It already has a profit. Personal delivery mail is only increasing in price because of Congress, not the agency. Competition in personal delivery would go the same as is packages and express. It would still carries a large percentage of deliveries for both UPS and Fedex because they cannot afford to play a 200 year catch up game and found that it's cheaper anyway to piggy back.

I am all for calling out a failing government agency, but I will also give credit where credit is due. I don't believe the hype from pundits on the USPS. The accounting is just not there.

[Chris]

I should be more clear then. The last several PMGOTUS have run the service at such a high level of efficiency had Congress not mandated how they provide for pensions the USPS would run as well as any private business.

It is external influence that is the problem, not how the department runs itself.



Define success. It already has a profit. Personal delivery mail is only increasing in price because of Congress, not the agency. Competition in personal delivery would go the same as is packages and express. It would still carries a large percentage of deliveries for both UPS and Fedex because they cannot afford to play a 200 year catch up game and found that it's cheaper anyway to piggy back.

I am all for calling out a failing government agency, but I will also give credit where credit is due. I don't believe the hype from pundits on the USPS. The accounting is just not there.


So a government agency is screwed because of Congress. Therein lies the problem. The USPS doesn't answer to the people in competitition with other companie, but to Congress.

Success? A profit from delivering what people value. I for one do not appreciate all the unsolicited junk mail.

[Mr. Freeze]

So a government agency is screwed because of Congress. Therein lies the problem. The USPS doesn't answer to the people in competitition with other companie, but to Congress.

Success? A profit from delivering what people value. I for one do not appreciate all the unsolicited junk mail.

Right now there is no competition, not because UPS and FED Ex can't compete but because they truly cannot compete. Part of creating a business is finding unmet needs and fulfilling them or seeing how one company is failing and doing it better. The USPS has had more time in the game and runs efficiently. UPS and FEDEX cannot gain that type of experience in such a way as to mimic and do better.

They have tried and failed. This is why they pay the USPS money to carry packages.

[BB-35]

All these private prisons Rethugs are building are the biggest threat to our freedom, besides the NSA.

The danger is tougher laws that jail people for victimless crimes to fill the prisons for profit. Inmates build stuff for industry to sell at windfall profits, and exploit the inmates and only pay them 50 cents per hour!

Sounds just like Red China to me!



'Rethugs' are building?

What the frak is a 'rethug'?

[lynn]

All these private prisons Rethugs are building are the biggest threat to our freedom, besides the NSA.

The danger is tougher laws that jail people for victimless crimes to fill the prisons for profit. Inmates build stuff for industry to sell at windfall profits, and exploit the inmates and only pay them 50 cents per hour!

Sounds just like Red China to me!



The solution to this would be easy by not allowing the federal government to subsidize each state's prison population. The states should be responsible for financing their own prison population all by themselves.

[Mainecoons]

Legalize drugs, treat it as a public health issue, and watch most of the prison population disappear.

[Contrails]

The government can't even run a healthcare website correctly.

If I'm not mistaken, the Healthcare.gov website's interface as well as its supporting back-end services were outsourced to a private company. Maybe if they had hired the people to do it themselves it would have worked.

[Contrails]

Success? A profit from delivering what people value. I for one do not appreciate all the unsolicited junk mail.

I suppose you're going to blame all of the marketing calls you get during dinner on AT&T and Verizon as well.

[Codename Section]

If I'm not mistaken, the Healthcare.gov website's interface as well as its supporting back-end services were outsourced to a private company. Maybe if they had hired the people to do it themselves it would have worked.

I can't imagine that the same people who selected a company already being sued for fraud and who just happened to be a college friend of the First Lady for a sole source contract know shit about running a software shop.

[Mainecoons]

If I'm not mistaken, the Healthcare.gov website's interface as well as its supporting back-end services were outsourced to a private company. Maybe if they had hired the people to do it themselves it would have worked.

Yes, no doubt had they hired people like the Medicare bunch who have dropped a quarter billion on penis pumps they would have had quite a web site.

:rofl: