Privatization

Postal Service Privatization

For more than a century, the federal government has pursued a misguided witch hunt against perceived monopolies in the private sector. But in a glaring hypocrisy, Congress has long protected one of the nation’s largest businesses against competition. The legal monopoly conferred on the U.S. Postal Service (USPS) is a relic. Government-run mail makes no sense in our email-dominated economy, and other nations are showing that postal privatization works. If the centuries-old Royal Mail can be privatized, then so can our USPS.

Infrastructure: Privatization and Innovation

Tomorrow at CPAC, I will discuss some advantages of infrastructure privatization. Perhaps the largest advantage is innovation. Unlike government bureaucracies, private firms in a competitive environment are eager to maximize the net returns of projects, so they find new ways to reduce costs and improve quality.

The Congressional Pack Rats

The U.S. Congress hoards real estate like proud pack rats. For example, the Department of Defense has 562,000 facilities that cover 24.7 million acres—an area about the size of Virginia.

Federal Infrastructure: Often Low Value

President Obama’s budget would raise taxes to fund a $478 billion infrastructure spending plan for highways, transit, and other items. The budget (on page 26) cites an International Monetary Fund study that “highlights the importance of choosing high-efficiency infrastructure projects based on rigorous benefit-cost analysis.”

Make America Safer: Shut Down the Department of Homeland Security

Congress created the Department of Homeland Security (DHS) in 2002 by combining 22 agencies that are responsible for a vast array of activities. President George W. Bush promised that the new department would “improve efficiency without growing government” and would cut out “duplicative and redundant activities that drain critical homeland security resources.”

Department of Homeland Security: Who Needs It?

The Secret Service is scandal prone. It spends excessively on foreign presidential trips, and it has agents who get in trouble with prostitutes and 

California, Drought, and Water Policy

In today’s Wall Street Journal, Stanford economics professor Edward Lazear provides an economist’s view of the California drought situation:

Privatize Aviation

In discussing one of her main achievements as British prime minister, Margaret Thatcher said, “privatization is at the center of any program of reclaiming territory for freedom.” One area where Britain reclaimed a lot of freedom is aviation. Since the 1980s, that nation has privatized airlines, airports, air traffic control, and in some cases airport security screening.

All Aboard the Privatization Train

With the expiration of the current federal highway bill in a few months, the infrastructure issue is heating up. Newspapers are ginning up interest with stories about deficient and falling down bridges.

Privatizing the Royal Mail

Britain privatized its Royal Mail in 2013, proceeding with an initial public offering of shares that raised about $2.7 billion. The government pursued the reform because the company faced falling mail volume, and it needed to reduce costs and increase innovation. Similar issues face the U.S. Postal Service.

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