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skort 4 days ago

Why are we letting private companies own public infrastructure?

supertrope 4 days ago | parent | next [-]

Politicians lack the will to push for public utilities. That requires asking voters to go along with the government taking on financing, planning, operations, customer service, and being the bad guys who raise prices. It's easier to point to companies as the bad guys who raised electric rates, likely sparked a wildfire, or are taking so long to fix an outage.

AnthonyMouse 3 days ago | parent [-]

The problem is this is set up as a dichotomy. Either you have privately owned infrastructure (and then a private monopoly), or make the utility company a government entity which then becomes an unaccountable bureaucracy captured by public sector unions etc.

Whereas the better thing to do is have the government own the physical plant (utility poles and conduits etc.) and then hire private contractors -- large numbers of small entities, not small numbers of large entities -- to do all the actual work of operating and maintaining it.

Make each contracted role simple and fungible so that none of them are too big to fail and they're all in competition with each other.

You don't want a public monopoly. You don't want a private monopoly. But who says those are the only options?

Spooky23 3 days ago | parent | next [-]

In New York, the cheapest utilities by far are public utilities owned by municipal governments. Same in Massachusetts — I saved a fortune dropping some stuff in Holyoke.

Generation is pretty low intensity from an employee standpoint. I know you’re brainwashed to hate unions, but they have little to do with it.

AnthonyMouse a day ago | parent | next [-]

Generation is the thing where you don't even need the government to own the infrastructure. Just don't prevent anyone who wants to from building a power plant and then have the grid buy electricity from whoever supplies it at the lowest price.

It's the transmission and distribution which are the "natural monopoly" -- the government should own the utility poles -- but that's also a thing where there is a non-trivial amount of labor involved for tree trimming and storm damage etc.

Panzer04 3 days ago | parent | prev [-]

Cheapest to the consumer, maybe? What's the actual financial standing of said companies? Plenty of government-owned utilities require lots of propping to cover their losses.

Spooky23 3 days ago | parent [-]

The three I’m familiar with are cash cows. Electricity is regulated and the rates have to be supported by the business model.

The small operators are mostly vertically integrated in a small area, so they can deal with the capital buildouts and aren’t subject to as many swings in commodity cost. They often even own the utility rights of way, generating additional income and avoiding property taxes.

It takes alot of union workers and pensions to make up for the pay of one private CEO.

supertrope 3 days ago | parent | prev [-]

To add an anecdote my city has a publicly owned electric utility. Most of the surrounding metropolitan area is served by an investor owned utility. My city has noticeably fewer outages than nearby areas. Although that might be because this city has buried utilities and was built later but this trend of fewer outages includes the main drag that was built in the 1800s. The private utility has raised bills much faster than the public utility. Both utilities face the same underlying cost push factors of labor costs, materials, and rising wholesale prices. The private utility announced a record quadrupling of quarterly earnings to 1.2B (year over year).

The public utility employs linemen. They don’t contract out operations.

nine_k 4 days ago | parent | prev | next [-]

It's either owned by a private company, or public (owned by municipality or similar).

mensetmanusman 2 days ago | parent | prev | next [-]

Government bureaucrats are among the hardest to fire, because they rate their own excellence.

Knowing this, there is probably a way to make things better…

pstuart 4 days ago | parent | prev | next [-]

Because our political system is rigged to allow the wealthy to make the rules.

danielmarkbruce 4 days ago | parent | prev [-]

Because public operation of infrastructure has often not gone well. And no matter who owns it, there is a cost of capital.

dghlsakjg 3 days ago | parent | next [-]

The interstate road system in the US is world class. Airports and ports are publicly owned, and seem to function very well in most cases. Education including the infrastructure and buildings is managed incredibly well in many jurisdictions. There are many, many examples of well run public infrastructure. We only notice the failures because 1. they are an easy punching bag 2. they are noteworthy because we expect them not to fail.

It is hardly a maxim that public operation of infrastructure is incompetent, and I would argue that "often" is not the right word.

danielmarkbruce 3 days ago | parent | next [-]

Many airports and ports are privately owned in the US. Much more infrastructure is privately owned than you might realize, including water systems, sewage, roads, bridges, ports, railway, pipelines etc.

dghlsakjg 2 days ago | parent [-]

Agreed, and much of that private infrastructure is mismanaged as well.

The point I was making is that public or private management is not a determining factor in the competence of infrastructure management. That is the point from the GP that I was rebutting.

danielmarkbruce 2 days ago | parent [-]

While it's hard to prove in any water tight way, folks who understand infrastructure management will tell you it is a determining factor all things considered (ie, cost included).

philipallstar 3 days ago | parent | prev [-]

US education has been in decline since the 1970s.

acdha 3 days ago | parent [-]

This is common mythology but it's a bit more complicated than that if you look at the data. Student performance is highly correlated with their parent's socio-economic status – a trend going back roughly a century in studies – and our educational system includes a wider range of students differing in both SES and, starting around that same time period, mainstreaming of many disabilities which used to get kids excluded.

That means that when you're making comparisons to either the past or other countries now, you want to compare cohort-matched groups. If your area has a bunch of poor brown kids used to leave school for jobs in the 8th grade and are now going all the way through graduation, that looks like the schools are getting worse even though the school's educational practices haven't changed and the problem you really want to solve is poverty or social mobility. This is especially true for international comparisons if you have things like tests where the population in one country going in is highly selective but broader somewhere else – everyone's acting in good faith but you still have distortion due to sampling bias.

The situation is similar: if a kid with dyslexia, ADHD, etc. in the 1960s would have been pushed out but now they're included, if you're looking at the global average it looks like test scores have gone down but if you look at subgroups of the student population you'll see that the top performers are still doing well and what changed was that another group was added.

At my son's school and some of the schools I went to as a kid, the subgroup breakdowns on stats are really stark: the kids from stable, middle-class or better groups do fine but the children of immigrants who are still working on their English skills struggle – and the lesson I've drawn is that we should have more support available for them outside of regular classes because it's such a powerful amplifier for everything else.

BLKNSLVR 3 days ago | parent | prev | next [-]

This feels like Churchill's democracy quote applies:

"It has been said that democracy is the worst form of Government except all those other forms that have been tried from time to time"

It has been said that public operation of infrastructure is the worst form of operation of infrastructure except all those other forms that have been tried from time to time.

DannyBee 3 days ago | parent | prev | next [-]

It's gone fine. It's always fun to hear about the wonders of privatization where everyone conveniently ignores that the vast majority of private businesses fail miserably. Over 50 percent in five years. Mostly due to mismanagement of money, the thing they are supposed to be better at. The rate is even higher (80-90 percent) if we were to look at small businesses.

They do have better PR though.

danielmarkbruce 3 days ago | parent [-]

https://chatgpt.com/share/68a37b87-6c30-8002-8a9a-76915e2e48...

dghlsakjg 2 days ago | parent [-]

We are all aware that public projects can fail. However, it does not logically follow that because some public projects fail, that all public projects fail, or even that most fail. Nor does it logically follow that because some private projects succeed, that all private projects will succeed.

Your LLM mentions two examples of failed public airports. Counterpoint: ATL is the worlds busiest airport by a few different metrics, and it is publicly owned and managed. So are most (maybe all?) of the rest of the worlds busiest airports. What does that mean?

By analogy: just because a person doubles down on a misinformed take using an LLM's output as evidence, that everything they think and know is false and misinformed by LLMs is not a foregone conclusion. It would be silly for me to think that someone that uses bad arguments once, or the same bad argument repeatedly in an online thread, is always going to be wrong.

You could do us all a service if you used your chatGPT account to learn about the basics of formal logic and sound arguments instead of spamming this thread with the same response from a machine that you asked for a biased output.

danielmarkbruce 2 days ago | parent | next [-]

Folks aren't all aware, various folks asked for examples.

ATL was the airport involved in corruption no?

Use formal logic to show a single thing I've said in this thread is illogical. You either cannot read, or don't understand formal logic.

2 days ago | parent | prev [-]
[deleted]
lenkite 3 days ago | parent | prev | next [-]

> Because public operation of infrastructure has often not gone well.

Kindly define "not well" compared to privately owned infrastructure.

user____name 2 days ago | parent | next [-]

All over Europe state utilities were privatized over the past 30 years or so. Has it been an improvement? Not really, things just got more complicated and more expensive. Rail especially is a disaster. Upgrading the electric and telecom grid is made more difficult because of all the (supposedly) competing utilities.

danielmarkbruce 3 days ago | parent | prev [-]

https://chatgpt.com/share/68a37b87-6c30-8002-8a9a-76915e2e48...

lenkite 2 days ago | parent [-]

OK, that didn't really do a comparison. But here are the examples that are considered better run than corporate infrastructure:

Singapore MRT (Mass Rapid Transit)

Fully government-owned and operated through Temasek holdings. Known worldwide for punctuality, efficiency, affordability, and cleanliness. Consistently outperforms privatized systems like the UK railways in reliability and customer satisfaction.

Paris Métro & RATP (France)

State-owned, with fares subsidized for accessibility. High ridership, integration with buses and trams, and affordable tickets outperform privatized systems in cost to the public.

Los Angeles Department of Water and Power (USA)

The largest municipal utility in the U.S. Provides electricity and water at lower rates than surrounding private utilities (like PG&E), and is often more reliable due to public accountability.

Norway’s Energy Sector (Statkraft, state-owned hydropower)

Provides cheap, renewable electricity. Profits flow back to the public treasury instead of shareholders. Norway has among the lowest power costs in Europe.

Germany’s Municipal Waterworks

Almost all publicly owned; provide safe, affordable, and reliable water with strong reinvestment in infrastructure, outperforming privatized systems in the UK (like Thames Water, plagued by leaks and debt).

Singapore Changi Airport

State-owned and consistently ranked as the world’s best airport. Clean, efficient, profitable, and reinvests in expansion. Private-run airports often prioritize concessions and profits over passenger experience.

Dallas–Fort Worth Airport (USA)

A publicly owned joint venture between Dallas and Fort Worth. It is one of the busiest and best-managed airports in the world, consistently profitable and reinvesting in facilities.

ISRO (Indian Space Research Organisation)

While not "utilities" per se, ISRO’s infrastructure (satellite launch facilities, tracking networks) is a prime example of state-run infrastructure outperforming expectations at extraordinary low cost.

Has launched satellites at a fraction of the budget of Western private and public space agencies, and even provides launch services internationally.

There are many more such examples. Public ownership tends to work best in natural monopolies (water, power grids, rail systems, airports, healthcare infrastructure), where competition doesn’t function well and the priority is universal service rather than profit.

danielmarkbruce 2 days ago | parent [-]

When you include costs, "better run" takes on a whole new meaning.

But, more simply - no one is suggesting all public ownership is bad, or all private is good. There are situations where governments have just decided they aren't doing a good job running something (all things considered) and that the amount of money they'd get for selling it is a better option all things considered.

sensanaty 3 days ago | parent | prev | next [-]

Could you list some examples of where public infra hasn't "gone well"? Because from my own view of things it's the exact opposite, whenever anything became privatized that shouldn't have been (rail, water, electricity, public transportation, healthcare) it inevitably follows the same churn as all the other things getting enshittified continuously.

The national railway in the Netherlands is a great example of this. They've privatized but with gov't subsidies, yet there's less trains, less people getting moved by the remaining trains, ticket prices skyrocketing YoY, worse service, rail workers getting shafted and basically being forced to go on strike in order to improve conditions. They're (NS) a monopoly too and handle something like 95% of all rail traffic within the Netherlands.

I believe the UK is going through a similar issue, where their railways are now privatized and in turn it's lead to increasingly worse service despite there being plenty of competition in the market in the form of many rail companies.

This lolbert fantasy of the "free" market being good for literally everything, including critical public infrastructure is a complete farce.

danielmarkbruce 2 days ago | parent | next [-]

https://chatgpt.com/share/68a37b87-6c30-8002-8a9a-76915e2e48...

The basic problem with the way you are thinking about it with respect to the national railway is that you don't seem to include cost to the government (ie, the people) to run it. Much infrastructure might appear to be "well run" by the government until you see the massive hole in the their budget. Sometimes the service has to get worse. When the government decides some piece of infrastructure must "pay for itself", they often sell it or hand over management to a private entity as a way to shift blame.

There are many private companies/PE firms etc who are competitively bidding to own these assets. It's not some license to print money, they are low return low risk assets.

user____name 2 days ago | parent [-]

Erh... if a public service is publically deficit financed (no debts incurred) and not for profit (lower priced) those are two positives, not negatives as your generated answer seems to suggest.

danielmarkbruce a day ago | parent [-]

No, it's not positive. It's just a choice - do you want users of said infrastructure subsidized by non-users or not? Sometimes the answer is yes, sometimes no.

speleding 3 days ago | parent | prev | next [-]

The railway system in the Netherlands is not privatized. The structure is publicly owned but operated under a concession model where both state-owned and private companies may run services. There are some regional operators that are private companies, but by far the largest part, NS and Pro-rail, are wholly government owned.

I'm not in favor of privatizing a natural monopoly like railway infrastructure, but in the case of NS I'm not sure privatization would be worse than what we have now: "market friendly" salaries for management, and yearly losses go to the tax payer.

sensanaty 3 days ago | parent [-]

That's my mistaken read of the situation in NL then! I'd edit my comment to point this out but am unable to at this point unfortunately :(

zelos 3 days ago | parent | prev [-]

Private vs public is just one factor. The UK's rail services improved hugely post-privatisation: https://en.wikipedia.org/wiki/Impact_of_the_privatisation_of...

user____name 2 days ago | parent [-]

Classic British irony.

cma 3 days ago | parent | prev | next [-]

You can have competing operators bid for the contract to operate without owning.

danielmarkbruce 2 days ago | parent [-]

Yup, there is a publicly listed company called "American Water Works" which has many such agreements with local governments for water/sewage infra.

Spooky23 3 days ago | parent | prev [-]

Municipal bonds are the cheapest capital available anywhere.

danielmarkbruce 2 days ago | parent [-]

Yup, they are low cost. But not zero. The money is still owed, too. The bondholders are not going to just let the public take the asset back because people have been paying for the service all these years.