[ support:54% : certainty:48 ] · [23 replies] · [0 comment]
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supporting arguments 54% · [make argument]
by wikipedia on 2005-05-14 00:40:54
Governments may "bail out" poorly run businesses with money when, economically, it may be better to let the business fold.
by wikipedia on 2005-05-14 00:42:51
Nationalized industries can be prone to interference from politicians for political or populist reasons. Such as, for example, making an industry buy supplies from local producers, when that may be more expensive than buying from abroad, forcing an industry to freeze its prices/fares to satisfy the electorate or control inflation, increasing its staffing to reduce unemployment, or moving its operations to marginal constituencies; it is argued that such measures can cause nationalized industries to become uneconomic and uncompetitive.
60% · Performance
by wikipedia on 2005-05-14 00:38:35
The government may only be interested in improving a company in cases when the performance of the company becomes politically sensitive.
0% · Inprovements
by wikipedia on 2005-05-14 00:39:08
The government may put off improvements due to political sensitivity — even in cases of companies that are run well.
0% · Corruption
by wikipedia on 2005-05-14 00:39:39
The company may become prone to corruption; company employees may be selected for political reasons rather than business ones.
0% · Goals
by wikipedia on 2005-05-14 00:40:09
The government may seek to run a company for social goals rather than business ones (this is conversely seen as a negative effect by critics of privatization).
0% · Capital
by wikipedia on 2005-05-14 00:40:24
It is claimed by supporters of privatization, that privately-held companies can more easily raise capital in the financial markets than publicly-owned ones.
by wikipedia on 2005-05-14 00:41:21
Parts of a business which persistently lose money are more likely to be shut down in a private business.
opposing arguments 45% · [make argument]
by wikipedia on 2005-05-14 00:50:32
Privatization will not result in true competition if a natural monopoly exists.
50% · Downsizing
by wikipedia on 2005-05-14 00:51:45
In cases where public services or utilities are privatized, this can create a conflict of interest between profit and maintaining a sufficient service. A private company may be tempted to cut back on maintenance or staff training etc, to maximize profits.
33% · Profiteering
by wikipedia on 2005-05-14 00:48:27
Private companies do not have any goal other than to maximize profit.
25% · Insecurity
by wikipedia on 2005-05-14 00:51:29
Nationalized industries are usually guaranteed against bankruptcy by the state. They can therefore borrow money at a lower interest rate to reflect the lower risk of loan default to the lender. This does not apply to private industries.
by wikipedia on 2005-05-14 00:52:20
A public service may provide public goods that, while important, are of little market value, such as the cultural goods produced by public television and radio.
20% · Inefficiency
by wikipedia on 2005-05-14 00:49:43
A centralized enterprise is generally more cost effective than multiple smaller ones. Therefore splitting up a public company into smaller private chunks will reduce efficiency.
0% · Corruption
by wikipedia on 2005-05-14 00:48:52
Buyers of public property have often, most notably in Russia, used insider positions to enrich themselves - and civil servants in the selling positions - grossly.
by wikipedia on 2005-05-14 00:49:09
The public does not have any control or oversight of private companies.
by wikipedia on 2005-05-14 00:49:26
If a government-owned company providing an essential service (such as water supply) to all citizens is privatized, its new owner(s) could stop providing this service to those who are too poor to pay, or to regions where this service is unprofitable.
by wikipedia on 2005-05-14 00:50:53
Profits from successful enterprises end up in private pockets instead of being available for the common good.
by wikipedia on 2005-05-14 00:52:01
Public services are per definition low-risk ventures that don't need scarce risk capital that is needed better elsewhere.

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