Austerity, Just Another Word for Privatization

The sheer obscenity of this is beyond belief. From The Guardian:

A government efficiency drive aimed at slashing spending in town halls and boosting productivity in the health service is likely to deliver billions of pounds of new business for private companies, the Guardian has learned.

Outsourcing firms are preparing for a bonanza of local authority contracts to provide everything from bin men to back office bureaucrats and have reported a doubling in the number of deals on offer this year. Private health companies are also expecting to earn billions of pounds from the planned overhaul of the NHS in which GPs would take over responsibility for spending £70bn.

Executives at Capita, the UK's largest outsourcing firm, said the number of opportunities for local authority contracts has already doubled this year and they see the healthcare market as "vast and potentially lucrative".

Richard Marchant, head of local government strategic partnerships at Capita, an FTSE-100 company which already works for councils in Harrow, Swindon, Southampton and Sheffield, said: "A major problem for the public sector is, we feel, a significant opportunity for us. Opportunities are at their highest level in two to three years. This year we have probably seen a 100% increase in opportunities [compared with 2009] and I suspect we will see another 50% increase in the following year."

Such an increase could deliver a £60m boost to Capita's revenues while councils are anticipating a 30% budget cut over the next four years. Other firms vying for town hall contracts include Serco and Mouchel.

The private sector boom comes amid the toughest financial climate for public services in a generation, and despite continued assurances from ministers that reforms to public services are aimed at achieving greater value for money and improving efficiency. Councils are braced for the biggest cuts to their budgets since 1945 and the growth in the market for privatised services has provoked anger that private shareholders, rather than taxpayers, are likely to benefit from efficiency savings that come from cuts.

Nor is it just British firms that are hoping to cash in on the chipping away of the British state. American firms want a slice of the NHS pie.

The US health giants Humana, UnitedHealth, Aetna and MCCI are all understood to be interested in healthcare contracts that could flow from a new commissioning system in which GPs may be given the power to buy in services from any health group or hospital that is properly accredited.

Minnesota-based UnitedHealth has already become a key adviser to primary care trusts and is running two GP practices in Derbyshire and three in London.

"There could be a bonanza for private companies if these changes go according to plan," said Jonathan Jackson at the stockbroker Killik & Co.

Privatisation of healthcare is being opposed by the unions.

"Private health already has a small role in the NHS [providing 4% of services], but we don't want it to grow," said Karen Jennings a spokeswoman for Unison, the public services union.

"The danger is that private companies will become so powerful that they will be able to determine what services are provided and how much they charge."

How Nick Clegg sleeps at night is beyond me. "If the coalition succeeds, by 2015 Britain will be a more liberal nation, a nation of stronger citizens living in a fairer society," Deputy Prime Minister Clegg said in a speech on Friday at the Demos think-tank. Clegg went on to say that his party, the Liberal Democrats, was united behind the spending cuts and tax rises in the budget. "This was a coalition budget, not a Conservative budget. The Liberal Democrats stand full-square behind the budget judgement," he said.

Meanwhile, opinion polls show support for Clegg's Lib Dems falling to as low as 15 percent compared with 24 percent in the May 6th election. Just to note that tax rise was an increase in the VAT to 20 percent from 17.5 percent, a rather regressive tax that affects the poor more. Since 1839 the Liberals have been battling Conservatism in Britain but Nick Clegg opts to enable David Cameron's budget that hits the poor hardest and emasculates the state. 

Even The Economist noted that "whatever the coalition’s intentions, the coming years will be painful for the poor." In his budget, Chancellor of the Exchequer George Osborne set out plans to entirely eliminate the UK’s record £155 billion deficit within the five-year lifetime of this parliament. Achieving this target will mean five years of austerity involving cuts in welfare benefits, public services, jobs, pay and pensions. While the VAT increase is expected to raise £13 billion, Osborne also announced a total of £11 billion in cuts to welfare spending.

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When Life Gives You Lemonade, Conservatives Make Lemons

Apparently random acts of kindness are too much for conservatives. Acts of simple humanity are unbearable to them. Such the only conclusion one can draw from Terry Savage's column in the Chicago Sun Times where she rushes to monetize acts of kindness.

Last week, I was in a car with my brother and his fiancee, driving through their upscale neighborhood on a hot summer day. At the corner, we all noticed three little girls sitting at a homemade lemonade stand.

We follow the same rules in our family, and one of them is: Always stop to buy lemonade from kids who are entrepreneurial enough to open up a little business.

My brother immediately pulled over to the side of the road and asked about the choices.

The three young girls -- under the watchful eye of a nanny, sitting on the grass with them -- explained that they had regular lemonade, raspberry lemonade, and small chocolate candy bars.

Then my brother asked how much each item cost.

"Oh, no," they replied in unison, "they're all free!"

I sat in the back seat in shock. Free? My brother questioned them again: "But you have to charge something? What should I pay for a lemonade? I'm really thirsty!"

His fiancee smiled and commented, "Isn't that cute. They have the spirit of giving."

That really set me off, as my regular readers can imagine.

"No!" I exclaimed from the back seat. "That's not the spirit of giving. You can only really give when you give something you own. They're giving away their parents' things -- the lemonade, cups, candy. It's not theirs to give."

I pushed the button to roll down the window and stuck my head out to set them straight.

"You must charge something for the lemonade," I explained. "That's the whole point of a lemonade stand. You figure out your costs -- how much the lemonade costs, and the cups -- and then you charge a little more than what it costs you, so you can make money. Then you can buy more stuff, and make more lemonade, and sell it and make more money."

It is their obsession to monetize everything that has brought us to this juncture. Where once there was a commons, a respect for that which belongs to all of us, conservative ideology has craved up the planet into private enclosures and if they could they monetize the very air we breathe, they would. The irony is that free market ain't free as both the financial crises and the Deepwater Horizon spill in the Gulf of Mexico prove. 

Damning Quote of the Day

From the New York Times:

Federal regulators warned offshore rig operators more than a decade ago that they needed to install backup systems to control the giant undersea valves known as blowout preventers, used to cut off the flow of oil from a well in an emergency.

The warnings were repeated in 2004 and 2009. Yet the Minerals Management Service, the Interior Department agency charged both with regulating the oil industry and collecting royalties from it, never took steps to address the issue comprehensively, relying instead on industry assurances that it was on top of the problem, a review of documents shows.

In the intervening years, numerous blowout preventers and their control systems have failed, though none as catastrophically as those on the well the Deepwater Horizon drilling rig was preparing when it blew up on April 20, leaving tens of thousands of gallons of oil a day spewing into the Gulf of Mexico.

Agency records show that from 2001 to 2007, there were 1,443 serious drilling accidents in offshore operations, leading to 41 deaths, 302 injuries and 356 oil spills. Yet the federal agency continues to allow the industry largely to police itself, saying that the best technical experts work for industry, not for the government.

Critics say that, then and now, the minerals service has been crippled by this dependence on industry and by a climate of regulatory indulgence.

Geez, who da thunk it but the critics were right. Why does anyone in their right mind listen to conservatives when time and again their ideology destroys the environment on a scale hereto unknown to man and puts profits before people?

The Party of Bad Ideas

They are not just the party of no, today's Republican party is also the party of singularly bad ideas. In Utah, GOP State Senator Chris Buttars is proposing that senior year of high school be made optional as a means of tackling the Beehive state's $700 million budget gap.

In South Carolina, State Rep. Mike Pitts, a four term Republican, introduced a bill earlier this month that would ban what he calls “the unconstitutional substitution of Federal Reserve Notes for silver and gold coin” in South Carolina. Yup, that's right he wants to take the country back to 19th century. From the Palmetto Scoop:

If the bill were to become law, South Carolina would no longer accept or use anything other than silver and gold coins as a form of payment for any debt, meaning paper money would be out in the Palmetto State.

Pitts said the intent of the bill is to give South Carolina the ability to “function through gold and silver coinage” and give the state a “base of currency” in the event of a complete implosion of the U.S. economic system.

“I’m not one to cry ‘chicken little,’ but if our federal government keeps spending at the rate we’re spending I don’t see any other outcome than the collapse of the economic system,” Pitts said.

But one legal expert told The Palmetto Scoop that, even if it were passed, Pitts’ bill would quickly be ruled unconstitutional.

“It violates a perfectly legal and Constitutional federal law, enacted pursuant to the Commerce Clause of the U.S. Constitution, that federal reserve notes are legal tender for all debts public and private,” the expert said. “We settled this debate in the early 1800s. I appreciate the political sentiment but the law is blatantly unconstitutional.”

Pitts, however, dismissed that claim, saying that “adherence to the Constitution is a two-edged sword. The federal government has consistently violated the Constitution, especially the 10th Amendment and Commerce Clause.”

Constitutional issues aside, Pitts’ bill faces another hurdle. Critics point out that silver and gold coins can’t actually serve as a form of currency.

“You can’t put a set value on a pure silver or gold coin because it’s actual value fluctuates,” one expert said. “You can say a gold coin is worth $50 but it would actually be worth whatever the market says it’s worth, based on supply and demand. In reality, what you have is a bartering good, not a form of currency.”

Still, Pitts said, a system based around bartering is better than a currency-based economy.

A barter economy? That's a sign of systemic failure, not of a healthy economy. It is almost as if conservatives would prefer to turn the country into a Zimbabwe rather than raise taxes. Perhaps we should all revert to growing our own crops and spinning our own yarn.

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The American Crisis

US payrolls were slashed by 524,000 jobs in December and by 1.9 million in the last four months of 2008. All told,  2.6 million jobs were lost in all of 2008. That's quite a dubious achievement but this didn't happen by accident, it happened by design. Conservative free market ideology and their devotion to a race to the bottom they call low taxes is the cause of all this. Let's not ever forget this. Conservatives profess to love their country and they profess to hate government. The pity is that, at times, they can't differentiate between the two. There is clearly a difference between the country and the government. The former is much larger if more nebulous than than latter but let's not forget that the government, in all its manifestations, is part of the visible edifice and the ledger of our country. In their zeal to drown the edifice of government in a bathtub, conservatives have managed to drown the country's ledger in a near eleven trillion dollar debt and throw at least 7.2% of us out of work.  It's not just the government that owes that lofty sum, it's the country. It's us. It's Americans who are now increasingly out of work thanks to the nefarious effects of an ideology that benefits the few at the expense of the many.

Conservatives so hate government that they can't seem to see that they are destroying the country in said pursuit. Even now. This is not a charge I say lightly. Even though conservatives have long impugned the patriotism of liberals for several generations now, we, as liberals, have failed to answer back. It's time we do. Conservatives wrap themselves in the flag even while they trample the rights, liberties and livelihoods of most Americans. Free markets are not free, there are costs. Witness AIG. There is no such thing as free trade, it too has costs. These are euphemisms for a perverse notion that conservatives call "economic liberty". By this, they mean unregulated markets, low taxes, the right to move capital across global markets (to call them countries is so 19th century) in pursuit of unholy profits based on tapping the cheap labour of the unprotected masses in the developing world. Backed by a devotion to a strong dollar and weak barriers to trade, they have dismantled brick by brick American manufacturing moving it to China, Bangladesh or wherever the lowest cost worker happens to be. I ask you is this patriotic? Is this love of country?

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Diaries

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