The Privatization of Everything: How the Plunder of Public Goods Transformed America and How We Can Fight Back
Reviewed by J.E. McNeil
February 1, 2023
By Donald Cohen and Allen Mikaelian. The New Press, 2021. 320 pages. $28.99/hardcover; $18.99/paperback (available in April); $27.99/eBook.
This is a story of greed and destruction . . . and redemption. It is a heart-rending book with hope threaded through it.
Donald Cohen, founder and executive director of In the Public Interest (a research and policy institute that studies public goods and services), and Allen Mikaelian, an author and historian, have written a useful book with a fairly brief history of the policy and specific incidents of privatization, in which they describe both the value to investors and damage to the public. Importantly, their book also gives examples of successful pushback.
I became acquainted with privatization of public goods during the Nixon administration. There were attacks on public education and other public goods in the name of strengthening the rights of individuals in the “free market.” (I put this term in quotes because it is an illusion, much like the Wizard of Oz, meant to distract from the real motives of greed and power. To write without quotes, would imply that it really exists, which is demonstrably not true.) Health services became the health industry. Also, in the name of pension reform, retirement money was no longer managed by trusts but by the individuals themselves, regardless of their financial ability.
The theoretical underpinnings of privatization come from economist Milton Friedman, who wrote in the 1950s that people were incapable of acting for the common good, so privatization of public goods in a democracy would allow the “free market” to assure the common good.
It was years before I could see the man behind the curtain: after many clients lost their retirement money while trying to manage it. The HMO to which I belonged went bankrupt making bad financial choices based on “free market” theories. I no longer saw the “free market” as a basis for anything.
The real push for ending democratic control of public goods began in earnest in the Reagan administration with the claim that government pensions and social programs (rather than White flight from desegregation) drained the tax base of cities. The loss of income led to slashing services, driving even more people from cities. This opened the door to corporations claiming that the government should allow the “free market” to do a better job. The “free market” policy was used so effectively as a bipartisan answer that now not only are toll roads privately managed, but so are many prisons; privatization has increased in the military and in some public water utilities, all to a devastating effect.
The Privatization of Everything lays bare the machinations and lies that are used to take public goods solely for private operation, and makes clear those gains usually come at public expense. For example, many private toll roads management contracts with the states require that new roads cannot be built “in competition” and, if mass transit reduces the amount of tolls paid, the state has to pay a guaranteed minimum to make up for the loss of income.
This is an ideal book for an activist as it is logical, clear, and tells a good story by breaking it into specifics: health, water, and food; transportation, communications, and economics; democracy, justice, and more. The upshot of many sections is how to push back and successfully retake public goods or—even better—stop the taking in the first place.
For example, between 2003 and 2019, over 70 communities bucked the trend to hand municipal water over to industry, inspiring others to disclose secret meetings of corporations with city council members over privatization of municipal water. Public meetings were packed, and damning information showed the problems with corporations’ proposals. “As one resident wrote to the Baltimore Sun, ‘They say you can’t fight City Hall, but we did. . . . We can come together to prevent abusive corporations from gaining a foothold in this or any other city.’”
Some of the worst abuses are yet to come. Of interest to me as an attorney was the attempt to force people to buy information about Georgia’s public laws from a private corporation with no government-posted alternative. Also a corporation was thwarted from gaining from the federal government the exclusive rights to weather data and its analysis. The result would be that states and the federal government would need to buy analysis of weather predictions from the corporation in order to prepare for natural disasters. The government would not be “allowed to compete” by creating its own analysis of its own data.
Often activist books have a chapter at the end with a one-size-fits-all solution. The final chapter of this book is less about a perfect solution than a call to action:
This book is about power—power over the things that matter to all of us. . . . But even though these are very real needs, our politics has been dominated by the theory that public power over such things is dangerous, that only the free market can guarantee freedom. . . . The most important lesson of this book is that, because we gave private interests that power, we can take it back. . . . [And if we do,] we will gain an incredible opportunity to build instead a society based on public values and a commitment to ensuring that public goods are available to all.
That would be something to be part of.
J.E. McNeil is a member of Friends Meeting of Washington (D.C.), an attorney, and has been politically active for more than 50 years. She is always grateful for the opportunity to learn more about the ins and outs of the United States and its economy and to work for justice within it.
Comments on Friendsjournal.org may be used in the Forum of the print magazine and may be edited for length and clarity.