Private sector depends on public subsidies to compete with public sector [View all]

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from OnTheCommons.org:



Business Can't Win the Privatization Game Without a Handicap
Private sector depends on public subsidies to compete with public sector

June 4, 2012 | by David Morris


Handicapping occurs in sports to equalize the winning chances of contestants of varying abilities. Sometimes, as in horse racing, superior horses, based on past performance, are required to carry more weight. Sometimes, as in golf, poorer players are allowed more strokes.

Unbeknownst to most of us, the competition between public and private sectors is also handicapped. But contrary to the popular wisdom, it is the private sector that often cannot compete without being given more strokes.

Consider these three examples.

School busing

About 75 percent of Pennsylvania’s school districts now use private firms to bus their students. Yet according to a new by the Keystone Research Center (KRC), “Contracting out substantially increases state spending on transportation services. We estimate that if all districts switched to the self-supply of transportation services, total spending on student transportation services would fall by $78.3 million dollars…” ..................(more)

The complete piece is at: http://onthecommons.org/magazine/business-cant-win-privatization-game-without-handicap