How neoliberal was Margaret Thatcher?

Thatcherism is just another word for neoliberalism, says Kevin Rudd. It’s been almost two decades since Margaret Thatcher left office and her record has been obscured by mythology. Sure she took on the unions and sold off some public enterprises, but did she really "roll back the frontiers of the state"?

Despite more than a decade in power, Mrs Thatcher left office with tax revenues running at around 36.1 per cent of gross domestic product. In the same year, Australia’s social democratic government had tax revenues running at around 28.5 percent of GDP. And last year, the Australian treasury was bragging that Australia’s tax to GDP ratio was "substantially below the OECD average of 36.2 per cent".

Of course getting taxes down to the current OECD average was a significant achievement in 1980s Britain. According to Paul Pierson, the Thatcher government succeeded in reducing total public expenditure from 44.0 per cent to around 40.1 of GDP (while allowing expenditure to rise to 47.5 per cent in 1982). It’s true that 40 per cent is lower that 44 per cent, but it was far less than the reduction many of Mrs Thatcher’s supporters were hoping for.

In the 1994 book Thinking the Unthinkable Richard Cockett writes about the disillusionment of neoliberal activists like John Hoskins, Norman Strauss and Alfred Sherman:

Although Mrs Thatcher might have appeared to be radical, at the vital moment she had failed to grasp the nettle of institutional reform that might have foreshadowed a real return to economic liberalism; as it turned out, the levels of public spending (in real terms) in 1990 when Mrs Thatcher left office, had hardly changed from the year when she had entered Downing Street in 1979. Measured by this important yardstick ‘Thatcherism’ had thus made very little impact at all (p314-315).

Of course none of this should have been a surprise. In a 1977 piece for the Spectator, John Grigg warned that Mrs Thatcher was bound to disappoint her supporters if she won office. He argued that the previous Conservative Prime Minister’s embrace of the "neo-Liberal economic programme" had been a disaster. After clashing with the unions, said Grigg, Prime Minister Heath abandoned the "dogma of laissez-faire" and took a more pragmatic course.

According to Grigg, Mrs Thatcher was "more practical politician than ideologue" but was constrained by her own prejudices and by those of her "radical right" enthusiasts:

The ‘radical right’ corpus of doctrine is a resurrection of nineteenth-century Liberalism largely accomplished through the thaumaturgy of two foreign academics — the Austrian Professor F.A. von Hayek and the American Professor Milton Friedman. Both are eminent thinkers, but neither could be said to have much understanding of the realities of politics in Britain.

Mrs Thatcher might have ignored his advice about relations with the trade unions, but she did turn out to be more pragmatic than her current reputation suggests. At the New Statesman Dominic Sandbrook notes that Thatcherism "was more fluid, more improvised, more complicated and more contradictory than the neat, sterile neoliberalism of the political science textbooks."

One example of political pragmatism is the bail out of British Leyland. Before the election, Mrs Thatcher’s industry minister, Keith Joseph, insisted that "For every job preserved in British Leyland, Chrysler and other foci of highly-paid outdoor relief, several jobs are destroyed up and down the country." But faced with the collapse of the nation’s largest car manufacturer, the government quickly abandoned its liberal principles.

"The economic implications of such a collapse were appalling", Mrs Thatcher wrote in her memoir: "One hundred and fifty thousand people were employed by the the company in the UK; there were perhaps and equal number of jobs in the component and other supplying industries dependent on BL."

A review of the books concluded that a government bail out would probably fail — in the end, the company would run-down or go into into liquidation. But as Mrs Thatcher explained, "the final judgment had to based on wider considerations." Presumably these were the same consideration Geoffrey Howe referred to in his 1976 memo to Michael Heseltine. — " a very large number of seats in the West Midlands Area, must depend upon the votes of British Leyland workers …"

Professor Hayek must have found this discouraging. In 1981 he told the Listener "I have often regretted that there haven’t been more bankruptcies in the past; the British economy would be in a better position now if more firms had been eliminated and not kept artificially alive" (p280).

It’s difficult to know how industry would have fared under a different government. But according to Dominic Sandbrook, it’s a myth to think Mrs Thatcher destroyed British manufacturing all on her own:

… it had been ailing throughout the 1970s and 1980s, and many firms were probably doomed to collapse, even without the austerity of her first government. If anyone thinks that, had Thatcher fallen under a bus in 1974, Britain today would have booming coal mines, a roaring steel industry and car factories the envy of the world, then they have been reading the wrong history books.

While the Thatcher government is often seen as the paradigm case of neoliberalism, in the early 1980s the economists who were supposed to have inspired Thatcherism were looking to Chile. When Hayek wrote to Mrs Thatcher about the success of General Pinochet’s reforms, she wrote back explaining that while the "progression from Allende’s socialism to the free enterprise capitalist economy of the 1980s is a striking example of economic reform from which we can learn many lessons … I am sure you will agree that, in Britain with our democratic institutions and the need for a high degree of consent, some of the measures adopted in Chile are quite unacceptable. Our reform must be in line with our traditions and our Constitution" (p296).

Compared with her predecessors, Mrs Thatcher might have been a radical. But compared with the British, Australian, Canadian and New Zealand governments of today, many of her policies seem almost middle of the road. Comparing the Thatcher government to today’s governments is a bit like comparing a Triumph Dolomite Sprint to a late model Ford Focus. For enthusiasts, it’s best not to spoil the memory by taking a test drive.

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John Greenfield
John Greenfield
12 years ago

Of course The Lady was an uber-neoliberal. She has to be, by defintion. The only people who use “neoliberalism” are socialists and Luvvies like Luvvie Quiggin. But read, read, read their fulminations, and try as we might, it is quite clear the “neoliberal” huxsters, have no idea what they mean by “neoliberal” apart from “Thatcherism”.

Don Arthur
Don Arthur
12 years ago

Jacques – Here’s a chart which includes state and territory taxes:
http://taxreview.treasury.gov.au/content/Paper.aspx?doc=html/publications/papers/report/section_4-01.htm

John – It’s true that many people attack ‘neoliberalism’ without defining it, however John Quiggin isn’t one of them. Here’s his definition:

As the name implies, neoliberalism is a descendant of classical liberalism, defined by the fact that it is a reaction against social democracy, which also draws heavily on the liberal tradition. The US use of ‘liberal’ to mean ‘social democrat’ reflects the latter point.
Because it is primarily based on a critique of social democracy, neoliberalism places much more weight on economic freedom than on personal freedom or civil liberties, reversing the emphasis of classical liberalism. Indeed, it is fair to say that on matters of personal freedom, neoliberalism is basically agnostic, encompassing a range of views from repressive traditionalism to libertarianism.
In terms of economic policy, neoliberalism is constrained by the need to compete with the achievements of social democracy. Hence, it is inconsistent with the kind of dogmatic libertarianism that would leave the poor to starvation or private charity, and would leave education to parents. Neoliberalism seeks to cut back the role of the state as much as possible while maintaining public guarantees of access to basic health, education and income security.
The core of the neoliberal program is
(i) to remove the state altogether from ‘non-core’ functions such as the provision of infrastructure services
(ii) to minimise the state role in core functions (health, education, income security) through contracting out, voucher schemes and so on
(iii) to reject redistribution of income except insofar as it is implied by the provision of a basic ‘safety net’.
With this definition, a reasonably pure form of neoliberalism (except for some subsidies to favored businesses) is embodied in the program of the US Republican Party, and particularly the Contract with America proposed by Gingrich in 1994. The ACT Party in New Zealand also takes a fairly clear neoliberal stance, as do the more ideologically consistent elements of the British Conservative Party and the Australian Liberal Party.

John Greenfield
John Greenfield
12 years ago

Don

That is not a definition, as it relies on the even more meaningless notion of “social democracy”. Quiggin has been working up quite a sweat to paint a Manichean world of “social democrats” versus “neoliberals”. He should stick to chasing parked cars.

John Greenfield
John Greenfield
12 years ago

As a Marxist, I can’t help but smirk at all this “we are going back to nationalisations/social democracy” malarky. If the past thirty years did represent a disjuncture between “social democracy” (as though this dodgy state of affairs was ‘natural’) and “neoliberalism” then the current state actions of Australia, UK, US, etc. are precisely the actions of a state beholden to “neoliberalism” in that its primary job is to maintain the integrity of the commercial landscape for the next round of investment and accumulation.

Hardly, the “Revolution”.

Don Arthur
Don Arthur
12 years ago

John – I think this is a better example of Manicheanism:

Thatcherism … was akin to a Bolshevik movement: a group of ideologues emerged from the margins to seize control of the very centre and effect radical change. The path was fixed. There could be no turning back. All opposition had to be crushed. The human casualties were as necessary as they were inevitable. Mrs Thatcher may have purported to believe in the High Tory, Burkean values of tradition, organic hierarchy and the accumulated wisdom of past generations, but she was no pragmatist or gradualist. “Economics are the method,” she said; “the object is to change the soul.” No Marxist would have disagreed.

John Greenfield
John Greenfield
12 years ago

Don

You’ve got me there! :)

John Greenfield
John Greenfield
12 years ago

Don

Trust me. As a Marxist I can assure you, these au courant Leftists just project their own obssession with religion – ideology – onto everybody else. Because THEY are theo-loons, they think everybody else must be also. WRONG. They are the sicko obssessives.

pedro
pedro
12 years ago

Yes, don’t compare it to the Focus, I’ve one myself, and while I have very fond memories of my Ti Sud and 205 GTi, they really don’t compare. But those cars were cutting edge standouts in their time. I expect the real legacy of Thatcher should be sought in the performance of the British economy pre and post Thatcher and not in tax as a % of GDP.

derrida derider
derrida derider
12 years ago

Classic liberals used to have no truck with “national greatness” conservatives and cared about individual liberty. But Thatcher boosted “defence”, picked quarrels with any non-English speaking foreigner she could find, sold arms to all comers and followed her personal authoritarian instincts in crushing civil liberties.

All of which served to divert people from the unpopularity of her creation of “a spiv society” (in Neil Kinnock’s phrase).

True, British industry was already sick when she came to office but not necessarily mortally so – it still had lots of good craftsmen and some great engineers, for example. What put it beyond recovery was the extremely overvalued Pound consequent on her early strict monetarism.

John Quiggin
John Quiggin
12 years ago

JG, as long as you think regular use of the word “Luvvies” constitutes some kind of argument, there will be no point in engaging with you. But since you seem to have nothing else to offer, maybe you should stick with what you know.

Don, as I’ve written on the topic, the neoliberals were reasonably successful in cutting back the role of the state in various ways, for example in privatising infrastructure. But in quantitative terms, they had to run hard to stay in the same place because of the increasing relative importance of human services like health and education. And, in the end, privatisation only replaced ownership with regulation, and when that failed renationalisation was often the only option (British Rail and the London Underground being obvious UK examples).

Don Arthur
Don Arthur
12 years ago

John – I think you’re right about privatisation under Thatcher. And I think this points to one of the differences between principled classical liberalism and Thatcherism.

For some Thatcherites the public/private distinctions is a four-legs-good-two-legs bad thing. They don’t really have much of rationale for preferring private sector ownership and control. So when the government runs short of cash, selling things to your mates in the private sector seems like a great idea. And since you can get more for a business if you sell it as a monopoly, why not leave it that way?

Typically they’ll promise all kinds of benefits to consumers that will magically appear when the enterprise enters the private sector. But after subduing the unions, the new managers usually get away with providing the same crappy level of service at a higher price to consumers.

But for a classical liberal, the rationale for privatisation and deregulation is about opening services up to competition and letting the price mechanism work. If you privatise a monopoly who’s prices you’re going to end up regulating, you’d ask yourself, what’s the point?

The approach I’m most suspicious of is the ‘market design’ approach that assumes that policy makers are so clever that they can construct quasi-markets that deliver better services at a far lower cost than direct government provision.

It seems to me that people on the receiving end of a ‘market designers’ incentives generally have a far better idea about what’s going on than the designer. As a result, you get gaming and then bureaucratic micromanagement.

Tel_
Tel_
12 years ago

I’m a bit disappointed with the definition of neoliberal. Neither the American “liberals” (meaning Social Democrat, but mostly meaning welfare/nanny statist) nor the Australian “Liberal Party” (meaning Social Conservative with some buddies in business who might be up for mutual back-scratching), have much relation to classic liberalism other than borrowing the name and muddying the water (nothing unusual for politics).

Indeed, it is fair to say that on matters of personal freedom, neoliberalism is basically agnostic, encompassing a range of views from repressive traditionalism to libertarianism.

In the Australian context, from union busting to persecution of religious minorities, to convenient political scapegoats, we have seen predominantly Authoritarian techniques being used. I can’t think of any examples that might stretch to being called “libertarianism”, but I’m willing to listen if someone else can call it. Maybe I’m not old enough to dust off some history here. I would tend to put Thatcher into the same basket. Let me be the first to also point out, unions too have used their share of standover tactics both in Aus and the UK but it’s a very dim light of liberty indeed to exchange one bully for another.

http://www.ldp.org.au is probably the only party in Australia deserving of the name “liberal” in any meaningful sense.

What’s more, is there any useful value in economic freedom, if you don’t have personal freedom? I mean you can earn money, but you have to ask permission as to how you may spend it, might as well not bother.

Hence, it is inconsistent with the kind of dogmatic libertarianism that would leave the poor to starvation or private charity, and would leave education to parents. Neoliberalism seeks to cut back the role of the state as much as possible while maintaining public guarantees of access to basic health, education and income security.

It seems inconsistent with pretty much all of libertarianism, Other than selling off Telstra (which was exactly a case of exchanging ownership for miles of regulation, and now moving back to government ownership of the new broadband infrastructure), I’d be genuinely interested in anyone who can name effective policies that did manage to “cut back the role of the state as much as possible”. By the way, approximately half of our federal tax dollar goes to income redistribution and yet the number of people sleeping in doorways seems to be growing, you can count me as a fraction skeptical about these “achievements” of our current welfare system. I’d also shudder to think about the money drained out of this country by the War on Drugs (both directly and indirectly) and the consumption of drugs also keeps on growing.

I don’t see myself as dogmatic on libertarianism (maybe others do) but it really hasn’t even mildly been attempted in this country, nor has the type of neoliberal policy that fits the definition in #3.

vanaalst.robert
vanaalst.robert(@vanaalst-robert)
12 years ago

“Typically theyll promise all kinds of benefits to consumers that will magically appear when the enterprise enters the private sector. But after subduing the unions, the new managers usually get away with providing the same crappy level of service at a higher price to consumers.”
.
And the overall evidence for this is? It’s easy for me to think of previously public (semi-)monopolies around the world that improved after being privatized or semi-privatized — the university system in Australia being an obvious example — the unregulated bits are now money making machines that can often offer a really good education, whereas the bits that act like public enterprises are completely degraded (the Melbourne model providing the most extreme example of this, where they have tried to separate the good [essentially private, full-fee paying] from the bad [essentially public]). It’s hard to think how completely shit they would be if the government hadn’t allowed them to act as semi-private enterprises. Similarly, there are public transport systems that were privatized around the world that are outright monopolies like the MTR in HK that now create business around the world (they’re one of the companies bidding to run the trains in Melbourne), yet offer a cheap and really good service in HK. If they hadn’t been privatized, I rather doubt they would have tried to expand like this. The SNCF in France will be another good test of this in the future.

John Quiggin
John Quiggin
12 years ago

Conrad, an obvious piece of evidence on service quality is that of public attitudes towards privatisation. If the promises had been fulfilled, you would expect support for privatisation to increase as people had more experience of it. The opposite has been the case. A survey not that long ago showed that, even years after they had happened, there were strong majorities who rejected not only future privatisations but all the big privatisations of the 1980s and 1990s. I’ll try to dig it up if you’re interested.

vanaalst.robert
vanaalst.robert(@vanaalst-robert)
12 years ago

Thanks — although I’m not thrilled at public attitudes being used as evidence in this case, because I think many people simply don’t understand that there is a baseline level of performance that changes over time in many areas. I also think that many people simply have no understanding of what constitutes good performance in many important areas. A few obvious ones that come to mind are:

1) Australia has quite a good public primary and secondary school system by any measure you can think of (excluding mathematics achievement, which is average and declining), despite strong perceptions to the contrary. In addition, the decline in mathematics probably has little to do with the schools being public (it’s a problem across the first-world problem, excluding East Asia).

2) Australia has a really good public hospital system (despite constant complaints) compared to most countries.

3) The public transport in Melbourne, which people complain about constantly, is also really good. In addition, the main problems there are are in part caused by population increases, which have little to do with privatization (indeed, one could argue that even of the problems that exist, many are caused by the government writing poor contracts, not Connex).

4) There’s pretty good evidence that people have a general tendency to forget negative events that don’t cause high levels of arousal (just look at how good many people think the 60s was, despite most life indicators being far better now). Hence getting people to introspect on whether they happen to think a system is better now than the past is pretty unreliable (that would be the case for things that were once private but were made public and not just for privitization).

GeoffRobinson
GeoffRobinson
12 years ago

Despairing lefties consoled themselves with the thought that Thatcher hadn’t brought about as much of a change as she promised and here oddly then found support from the small intellectual cult of ‘classical liberals’, who like all utopians were disappointed with the use that real politicians made of their arguments. But recall that in the 1970s most observers from the left (the state monopoly capitalism school and the Marxist structuralists) and the right (Hayek’s 1970s work, Robert Moss etc.) predicted increasing levels of state ownership and control. To deny that Thatcher & Reagen brought about substantial shifts in public policy defies belief. Monica Prasad is good on this.

Patrick
Patrick(@patrick)
12 years ago

I love public attitudes and I am thrilled at their being used in this case. They are great evidence of good policy. I suggest John Quiggin start the ‘endorsed by public attitudes’ school of economics.

I expect that tax cuts will be high on his list of preferred policies, along with tough immigration controls. After all, if tax cuts really did erode essential serivces you would expect support for tax cuts to dencrease as people had more experience of them, and if immigration really did deliver a host of societal and economic benefits you would expect support for immigration to increase as people had more experience of it.

Cuts in fuel tax would probably be number 1 on the list.

pedro
pedro
12 years ago

Don’t forget high tariffs Patrick. It’s a crying shame we don’t make t-shirts any more. Hey, it’s not economics as such, but don’t forget reintroduction of the death penalty.

FDB
FDB
12 years ago

Yes of course populism isn’t the way to make decisions, but it’s not always such a bad way of evaluating them. After all, John’s talking not just about abstract economic theoretical decisions, but also the actual level of satisfaction from paying customers.

At least w/r/t public transport, my suspicion is that when people know that someone out there is making a profit from the operation, they expect a superior product, not the same old shit for ever-increasing prices. And you can poo-poo the economic savviness of the average Joe all you like, but he is right to demand a degree of competition from privatisations.

And not just the blowjobs and backhanders ‘competition’ for the contract.

vanaalst.robert
vanaalst.robert(@vanaalst-robert)
12 years ago

I agree with FDB that for some things, public attitudes are fine to collect. If we had proper before-and-after surveys of public transport now and 20 years ago, at least in Victoria, people would probably be correct in saying that customer service standards are down (it would be surprising if they wern’t, since there are now no tram conductors, no-one to take money at stations, there is almost no security etc.). I also think they’re worth knowing for the sake of political opinion on issues. Who knows whether this was due to privatization or not, but public attitude probably thinks it is.

Alternatively, I’m more interested in knowing to what extent the empirical evidences supports the claim that privatizations have really failed in monopoly situations (or even cost more), since I don’t think the issue is very clear cut, and I can certainly think of situations where it has been beneficial, such as those I mentioned. Thus I’d like to know to what extent Don Arthurs claim is true, as it’s certainly a claim that is often heard.

Tel_
Tel_
12 years ago

But recall that in the 1970s most observers from the left (the state monopoly capitalism school and the Marxist structuralists) and the right (Hayeks 1970s work, Robert Moss etc.) predicted increasing levels of state ownership and control.

Well we got increasing levels of state control, in most every aspect of our lives. Here I have the state telling me how much to save for my old age, which investments qualify and in what proportion, and who is entitled to take the money. Just lately I hear that the state instructing me when to feel confident in their financial system (I mean, that’s just insulting).

To deny that Thatcher & Reagen brought about substantial shifts in public policy defies belief.

Oh they have done an excellent job of rearranging the window dressing, authoritarianism never looked so reasonable as it does today. Did you know that as an electricity consumer I can choose to be billed by a wide range of private companies all offering the same product (the EXACT same product) at the same price? How wonderful for me to be able to select a letterhead to suite my taste.

After all, if tax cuts really did erode essential services you would expect support for tax cuts to decrease as people had more experience of them,

We do have a democratic system and the major parties rarely wade into an election with a promise of tax cuts, so they either have a gentleman’s agreement going or they genuinely don’t expect to win on that one. I’m still waiting for a candidate who gets asked, “What are you doing for families?” and has the balls to answer, “I’ve got a plumb job lined up for my brother as soon as you bastards vote for me, and there’s a few very cunning kickbacks ready for my kids.”

Tel_
Tel_
12 years ago

Yes of course populism isnt the way to make decisions, but its not always such a bad way of evaluating them. After all, Johns talking not just about abstract economic theoretical decisions, but also the actual level of satisfaction from paying customers.

You only have to look at the gridlock on the roads and note that fuel gets bought at any price, to understand how deeply unimpressed people are with public transport.

John Greenfield
John Greenfield
12 years ago

Don

I think you will find there were some quite pressing reasons for Thatcher’s privatisations. The UK economy by the late 1970s was third world. The place was about to collapse.

JQ

But in quantitative terms, they had to run hard to stay in the same place because of the increasing relative importance of human services like health and education

What illogical meaningless Luvvie pap. Unfortunately JQ, this sentence is typical of your interminable sermons. All bereft of evidence, conceptually chaotic, and displaying the intellectual maturity of first year Political Economy tutorial

Don Arthur
Don Arthur
12 years ago

John G – It’s pretty clear that the British economy was in trouble. There’s a reason the Callaghan government went to the IMF. But I’m not sure how this strengthens the case for privatising an enterprise like British Telecom.

John Kay makes a good point:

It was apparent early on stage that not only were the sale of public assets and the liberalisation of markets not the same thing, but that they might often conflict. The privatisation of BT probably slowed the introduction of competition into British telecommunications. The deal between Dennis Rooke and Peter Walker which paved the way for the privatisation of British Gas ensured that no restructuring of the company took place and that liberalisation – and the break up of the business – came about only after a long regulatory battle.

John Greenfield
John Greenfield
12 years ago

DA

Well one obvious benefit would be freeing up capital and a sizeable injection to the government’s biggy bank!

derrida derider
derrida derider
12 years ago

JG, JQ was just referring to the Baumol Effect (or Baumol’s Curse) – google it.

FWIW Baumol is in fact a Chicago economist who was a noted and very influential proponent of privatisation in the 70s and 80s.

derrida derider
derrida derider
12 years ago

And JG, I dunno what do you mean by “freeing up” capital – it was just a transfer of existing capital from a public to a private monopoly.

The effect Don quoted John Kay on is the biggest pitfall of privatisation. The problem is that it is always in the government’s political interest to get as high a cash price for the assets as they can to dress up the books. But this runs directly contradictory to the national economic interest, which is to ensure maximum competition, or if that is not possible then close regulation. The prospect of either will massively reduce the sale price.

The sale of Telstra provides, inter alia, a good Australian example of the problems caused by this conflict of interest.

vanaalst.robert
vanaalst.robert(@vanaalst-robert)
12 years ago

“The sale of Telstra provides, inter alia, a good Australian example of the problems caused by this conflict of interest.”
.
Alternatively, with what I assume are the same conflicts of interest, the privatization of Singtel apppears to have been quite successful.

pedro
pedro
12 years ago

That is correct DD, but it is not an argument against privatisation, just against the form taken in that case and here. Cross-city Tunnel in Sydney is another example. The problem you mention is just another manifestation of the goose-plucking theory.

Still, the privatisation of a monopoly to a near monopoly may still have some benefits compared to the status quote ante. First, there is some competition and secondly the profit maximisation behaviour is moved further into the open. In Qld we have something of an electricity crisis some years ago because Govt demands for dividends lead to a run down in infrastructure. After the election to fix the problem we now have the state govt demanding an increase in dividents because of their budget woes. Good merry-go-round that one.

Patrick
Patrick(@patrick)
12 years ago

Conrad, what do you mean about public transport? That the population has increased?

Public satisfaction is imho and experience nothing to do with staff levels. People want trains on time and often and fairly clean and, yea, they would like to sit. Our trains aren’t bad on all the first three but the fourth, well, what to do?

Pedro, good points, I would have mentioned death penalty but I think the last time I checked public opinion had moved to about neutral. Nonetheless a far greater amount of support than JQ et all would admit or acknowledge. Same for three strikes, etc.

I don’t think FDB’s reframing adds much – I think he gives the lie to his own example on public transport and how does it change any of the other examples??

vanaalst.robert
vanaalst.robert(@vanaalst-robert)
12 years ago

Patrick,

I mean that some public transport problems people attribute to Connex (private) having nothing to do with a private/public distinction, but are rather caused at least in part by population growth. Trams, for example, have to wait in traffic longer because of extra traffic, train capacity is more stretched etc. You can probably add weird suburbs with no train lines to that too.

“Public satisfaction is imho and experience nothing to do with staff levels”
.
That would certainly be untrue of trams. People used to love the conductors, and they were more profilic than inspectors, whom most people don’t love.

vanaalst.robert
vanaalst.robert(@vanaalst-robert)
12 years ago

sorry that should be “prolific”

Patrick
Patrick(@patrick)
12 years ago

Ah yes I don’t get trams much. I agree that inspectors are often boorish and absurdly inflexible although this latter is probably not their fault. It would seem to me better to give anyone who can stammer out a half-plausible excuse a let-off on their first offence.

FDB
FDB
12 years ago

“I agree that inspectors are often boorish and absurdly inflexible although this latter is probably not their fault”

Quotas and per-infringement commissions.

pedro
pedro
12 years ago

Some support for what I said about privatisation:

http://www.econlib.org/library/Columns/y2009/Powellstreets.html

“In 2004, the Chicago Skyway was leased to a private company for 99 years for more than $1.8 billion. The company has the right to toll and concession revenue and the responsibility to maintain the road. In 2006, the same company purchased the right to maintain, operate, and collect tolls on the Indiana Toll Road for 75 years for $3.8 billion. Soon after acquiring these roads, the company introduced electronic tolling on them. Could the government have done this? Of course. But government lacks the profit-maximizing incentives that spur businesses to innovate to better serve consumers, so innovation and responsive customer service by government are much less likely.” Not least because of the toll booth attendants union.