I can see a correlation, which suggests that somewhere there’s might be a causal relationship to be found. It basically goes like this: once your population are educated beyond a certain level, they start realising that they’re being systematically screwed and asking for some pie. We call this “the Enlightenment” in Europe, other things in other cultures. At some point, as this filters beyond your entrepreneurial classes and into the true mass of your population, it becomes too expensive to make actual things. As Britain discovered the hard way, this is because places where wages are massively lower will always beat you in a commoditised marketplace.

I’m aware that this is the for-the-hard-of-thinking version and thus simplified to hell, but the underlying reality is visible not only in the first post-industrial economy (Britain) but also in the economies soon to fall off that cliff (USA, Germany, etc.) Eventually it will be visible in the BRIC economies which are pushing the Yanks and the Germans over the edge. And as is extensively discussed in this thread, hard on the heels of secondary industry becoming something you can’t do cheaply, government services seem to follow.

This, of course, reflects not at all on what one should do about it. The fact you can’t provide an essential government service cheaply doesn’t, to me, mean you should stop providing it. In this I am following the hymnsheet of typical right-wing rationales on the subject of armed forces funding. The argument, now and possibly forever, lies in the categorisation schema.

Per hour worked, state and local government workers enjoy 34% higher wages and 70% more benefits than their private-sector counterparts

http://www.cato.org/pubs/journal/cj30n1/cj30n1-5.pdf

In some cases perhaps. But in no Government service do the incentives to provide a good public service match with the desires of the civil servants to do as little work as possible for as much money as they can. Government services always and everywhere decline to whatever the Government and public will tolerate. To keep them even marginally acceptable requires an endless purge of the incompetent and corrupt. Which we no longer do.

“For example, see the PFI scheme in Norwich – where the contractor’s main method of increasing profit has been not to improve services to patients, but to spend vast amounts of (ultimately public) money on lawyers to dispute and renegotiate the contract to get them a better margin for less work.”

Sure. And the Government’s IT contracts are essentially designed to say “Open Sesame” to the public purse for the Government’s favoured contractors. As I said, the Government cannot do much right.

“Inserting the private sector into a situation does not automatically make for better outcomes, nor does it result in magically being able to lower pay or provide worse conditions for the workforce without consequences (as the numerous strikes on the privatised rail system illustrate).”

No one is saying it does. Just that Government run services are inevitably and everywhere worse. It is just a matter of waiting for the system to collapse.

Because it is better than no comparator. If you want to make a better comparison, go ahead.

In any event, the most important sentence is productivity has fallen most years in the past decade.

Which is a pretty reliable sign that productivity could be improved.

The fact is that the incentives in the market are to produce profits, not to provide better public services. In some cases, getting these aims to co-incide is difficult to impossible, and you end up with perverse incentives.

For example, see the PFI scheme in Norwich – where the contractor’s main method of increasing profit has been not to improve services to patients, but to spend vast amounts of (ultimately public) money on lawyers to dispute and renegotiate the contract to get them a better margin for less work.

Inserting the private sector into a situation does not automatically make for better outcomes, nor does it result in magically being able to lower pay or provide worse conditions for the workforce without consequences (as the numerous strikes on the privatised rail system illustrate).

How many military bases, weapons manufacturers and aerospace companies are based in Colorado?

I think you may have a cart before horse problem, here. The precise mechanism by which a liability shield was erected between those who manage Britain’s public transport links and those who have to use the damn things was privatisation.

It is only since privatisation that no-one gets sacked at the management level after a major train crash. These days, actual workers get sacked because the profit margins are coming down, and must go back up.

It is only since privatisation that companies have “competed” by charging extra for fares on each others’ routes: have “competed” by shifting the expensive bit, keeping the track maintained, out of their remit: have “competed” by failing to run franchises and then having them awarded straight back again. Private Eye have been commenting extensively on this since the late 80s, it’s well worth a look.

It is privatisation which has ended all restraints on the PFI poker players, in much the same way as the shift in culture in the Square Mile and on Wall Street during the 80s ended all restraint on financiers (and led directly to Barings, and Enron, and … oh you get the point). You’ll notice the formula is the same too; privatise profits, nationalise debts.

The French and German systems work though. You do not get the feeling that their entire Country is about to implode with a good push though. You don’t feel that their train system is falling apart, nor do you get the impression that their public sevices are ready to give up the ghost.

I don’t think they would. What they have done is keep a lot of services in the private sector where market discipline applies. This is why their health systems tend to be so much better than ours. Where they don’t have any market competition, what makes you think they are any different to us? Have you tried using the French mail? Do you remember the old French telephone company? Have you tried to get anyone in any French Government office in August?

This is despite the fact that the French and Germans are willing, some of the time, to get tough with their Unions. They do not tolerate incompetence in their railways in the way that we do for instance. At least not as much. But still.

Our choices are really only between high taxes and poor services or low taxes and poor services. The people of Colorado are on the right track. Now they need to throw the bums out and find some competent administrators.

I think the French, German, Dutch, Swedes and Danes would blow that out of the water.

Now, having drunk my last can, I am going to bed. Bye.

Look around Britain. Not mowing the parks? Not collecting the rubbish? Not keeping the lights on? I mean, come on, this is normal in most places.

On top of which we get to pay massive taxes as well.

It is not a choice between higher taxes and good services or lower taxes and poor services. Unless constant pressure is exerted by the voters, unless they continually deny the government more money and continually demand better services, the government will become flabby and incompetent. They will demand ever higher taxes and provide ever lower levels of service. As in Britain. There is no market discipline in government.

Our choices are really only between high taxes and poor services or low taxes and poor services. The people of Colorado are on the right track. Now they need to throw the bums out and find some competent administrators.

That is going to happen where ever you cut spending. More unemployment will just push the costs onto other parts of budgets. Health, crime, welfare spending etc all rise when unemployment rises. As of course when wage rates are lowered too of course.

You want to cut the council’s budget? Fine, but don’t count your savings until the all the bills are totted up.

I am sure this would show far superior public sector productivity – as the private sector values all the quality factors (small class sizes, top
class facilities, personalised services, broad curricula) that ONS productivity stats say are a complete waste of money adding nothing at all to output
and increase inputs massively.

A challenge for right-wingers to demonstrate the flaws in that intuitive logic?

Less lighting, more crime, more police, bigger state.

Less lighting, more accidents, more emergency services, bigger state.

Street lighting cuts costs elsewhere.

Get it?

“Contrast that with the private or “market” sector. Over the same period, again according to the ONS, market-sector productivity rose 22.8%”

The old public sector productivity chestnut.

1. Why do you suggest average private sector productivity is the right comparator? Why not private schools, private hospitals etc? Some parts of the private sector (eg construction) have seen relative falls in productivity compared with the public sector.

2. Half of Government output is produced in the private sector. Are lazy bureaucrats to blame for lack of productivity increase here (laziness contagion or something)

3. Output measured used by ONS are still experimental and still highly flawed, as you would see if you actually read the ONS report rather than take the headline. Output is defined as equal to inputs in a third of the public sector. There are time lags between spending and outcomes for most services (eg education outcomes are the result of 16 years of inputs). It is difficult to seperate the influence of Government from other influences on outcomes. The list of flaws goes on…

4. Many things that the public consider as improving quality have no impact whatsoever on output. Anything related with customer service is pure waste. Reducing class sizes is largely waste. Reducing waiting lists is waste. It’s no surprise that If certain parts of spending are defined as waste regardless of their impact on people’s valuation of services, then productivity will be negatively affected.

There’s a simple diagnosis to raise public sector productivity as measured by the
ONS experimental data – double class sizes, don’t teach
children who are not going to get 5 As and keep the remainder locked in a large room all day, half the number of doctors, shut all customer-facing parts of government, lock prisoners up 24 hours a day etc. Productivity would sky rocket. Services would be completely shit, but at least the numbers would look good, eh?

Perhaps true. When the snow fell in December and January, my local hospital trust recorded 2,000 more limb injuries than they expected. By reducing a public good (gritting of pavements), my local authority saved money but created a greater cost for the NHS and for employers owing to injured workers. (Whether this would be financially good for private health care providers would depend on their contracts and pricing model with insurance companies; a sudden demand for physiotherapists might be expensive to fulfil.)

Public fire services were established in the UK in 1865 because the private services, funded by insurance, did not suffice. The private fire services would tackle a blaze if it threatened the property of an insured individual, but given the limited communications of the day, that didn’t always work out. The public good argument for fire services is now established, and I don’t recall ever reading an argument that we have too much provision.

I cannot help questioning whether the Colorado Springs police department was consulted before the announcement that it was a good place for hookers, burglars and muggers to conduct business.

Nor can I prevent myself from saying that these are political gestures gone mad. Akin to Liverpool City Council in the 1980s. Disrespectful to those who pay for services.