[McG]

Originally Posted by GGG

Canadian Telecom industry is probably the best example of where government services deliver better services at a lower cost. We'll call it the MTS experiment.

Note my statement wasn't absolute, the government can be more efficient at delivering services and goods to consumers. It isn't always worse and in some cases can be better. This concept that the privatization will always lead to more efficient delivery is false. And the concept that people will always spend their money better than the government is also false. The absolutism of your position is what I take issue with.

And to be clear, i'm not mad or angry or anything. I used to work for MTS at one point and its not a great example.

I'll give you the industry though...particularly land lines way back when or internet cables now. In places where it is not economically viable and there is not a private industry in place, where an item is deemed in the public good, then the government would be fulfilling its role by helping to put land lines for phones or internet cable when no other alternative exists.

I understand that absolutism isn't the best way to discuss things because there are always examples that fall out.

But consider this. Do you think that government employees spend money better when they are private citizens or when they are government employees?

I would like to suggest Adam Smith and the Invisible Hand for some bedtime reading. the short version is "his notion that individuals' efforts to pursue their own interest may frequently benefit society more than if their actions were directly intending to benefit society."

Remember your Starbucks tax? I don't buy Starbucks, but that doesn't mean that it doesn't have value to the person that does. If they are willing to pay the cost, Starbucks accepts the transaction, makes profit, and moves on. Except that the coffee wasn't made in a replicator, it was a bean at some point, and had many factors of production in order to get to the coffee cup. Here is the thing. Do you know if Starbucks pays more for that bean than other suppliers? I mean the whole way through. I'm going to guess that Starbucks tries to minimize costs to maximize profits. What would the government do? would they minimize costs to maximize profits? No. There is your first efficiency. The second is what Starbucks does with the profit. Dividends. And who gets them? The owners. Who has the risk? The owners. if you have mutual funds, that is also you and I. What do we do with dividends? We spend them or invest them or save them. Doesn't matter. What does the government do? even if they were willing to minimize costs, they should not be maximizing profits. Or should they? What if the government opened its own coffee shop and competed with Starbucks. As tax payers/consumers, we should want competition to bring Starbucks prices down. For sure, the government coffee shop shouldn't be selling the coffee at break even or worse, at a loss. Maybe the government could have a drivethrough tax, and offset the cost of the coffee.

So now we have a drivethrough tax, Starbucks is more expensive, and we are going to give the coffee away for free with cost offsets from the drivethrough tax because it is socially responsible. See where this is going? Where is the efficiency there? Free coffee? Great! except it isn't. Except free coffee likely puts starbucks out of business, with jobs and factors of production lost all down the line. Out of business is bad for everyone but most importantly it is bad for the government. Think of all of the income tax and consumption taxes that they will lose when people aren't working and the job is gone. And everyone has to pay for the lost government revenue.

And now we come to doodads, shower heads and led lights. When this little initiative ends, will there be any LED or shower head or doodad suppliers in the province? Why would there be?

Privatization means that decisions will be made to minimize costs and maximize profits. That means efficiency. It doesn't mean the best service levels, it means the best use of the factors of production.

People will always spend their money better than the government. Proof? You spend your money better than I can spend your money. If you don't see that, you should vote NDP and let them tell you how to spend your money.

In Canada, we have developed a nasty and expensive habit of not only telling people how to spend their money, but actually spending it for them. That isn't a political statement because all political parties in Canada do it. Some just do it better than others.

And that's the end of my point.