Lethal Privatization And The Long Memory

by lizard

This Oxford-led study examining the dire effects of privatization isn’t new; it came out 3 years ago, but it highlights the lethality of a phenomenon that is, at best, indifferent to the human suffering it leaves in its wake.

As many as one million working-age men died due to the economic shock of mass privatisation policies followed by post-communist countries in the 1990s, according to a new study published in The Lancet.

The Oxford-led study measured the relationship between death rates and the pace and scale of privatisation in 25 countries in the former Soviet Union and Eastern Europe, dating back to the early 1990s. They found that mass privatisation came at a human cost: with an average surge in the number of deaths of 13 per cent or the equivalent of about one million lives.

The rapid privatisation programme, part of a plan known by economists as ‘shock therapy’, led to a 56 per cent increase in unemployment, which the study says played an important role in explaining why privatisation claimed so many lives. Many employers provided extensive health and social care for their employees, so through privatisation workers experienced the ‘double whammy’ of losing not only their livelihood but also their means of surviving the crisis.

I bring this up in the context of the fiscal cliff because some are advocating that privatization offers a third way to avoid the overly-hyped drop-off:

The standoff between Congressional Republicans and the Obama Administration on an alternative to sequestration and extension of the “Bush tax cuts” appears to center on tax rate increases versus reductions in entitlement spending.

But there is a third way – one which Virginia has shown in bipartisan fashion in recent years. As evidenced by the recently opened “HOT lanes” on the Beltway between the vicinity of the Dulles Toll Road and the I-495/395/95 “mixing bowl”, private sector involvement and investment in public sector activities is a way to advance services to the public without increasing taxes.

Through the use of divestiture, asset sales, contracting out, privatization, vouchers, and other similar tools and strategies, the federal government can get out of numerous lines of business. By relying on performance by a competitive free market system, or eliminating tax subsidies for nonprofit organizations that duplicate and compete with for-profit companies, Uncle Sam can reduce the deficit, hold the line on taxes, and preserve the safety net for the neediest Americans.

It’s important to remember—and constantly point out to others—that the American public is paying for what the financial sector has done to us, and we are paying for an aggressive global military presence that doesn’t benefit us or make us safer.

So, as the safety net is untied strand by strand, and labor rights are killed state by state, the snake-oil we are being sold as solutions are anything but.

And if you need help remembering, listen to Utah Phillips’ The Long Memory, accompanied by Ani DiFranco:


  1. We already went over the fiscal cliff when the housing bubble burst, triggering the great global economic meltdown. Without demand, private capital won’t create much of anything, especially jobs. That leaves government spending to keep the economic wheels turning. Privatize all you want, but without increased demand things won’t change all that much.

    Over half of all mortgages leading up to the 2008 crash were refinance packages that stimulated demand for bigger homes, kitchens, bathrooms, new cars and trucks, and all sorts of consumer “stuff.”

    Sombody tell me where that kind of borrowing is going to come from now?

    Wages are stagnant, or dropping. Benefits are being cut. Household costs are increasing for utilities, local taxes, food, and health care.

    Today’s privatizers are nothing more than vultures — no disrespect to vultures — in suits picking at the bones of our commonwealth.

  2. Big Swede

    Quote: “As many as one million working-age men died due to the economic shock of mass privatisation policies followed by post-communist countries in the 1990s, according to a new study published in The Lancet.”

    Golly gee whiz. How many died when the cattle cars were steaming down the tracks toward Siberia?

    How many fleas and ticks die off some gut shot coyote?

  3. JC

    Privatization = economic fascism. Plain and simple.

  4. Nice Swede. I think that similarities between govenments with supposed different structures was one of the points being made. Socialist and so-called free-market economic systems produce similar authoritatian results when citizens lose control of corrupt state institutions. Methods matter, right?

    • Big Swede

      Ranching close to Billings gave our family the opportunity to board horses especially when we had good grass years. So every few years out would come what Grandpa called, “Welfare horses” Welfare horses were spoiled hay/corral fed pets who seldom had foraged themselves, never drank from creeks or springs, always ran up to you looking for treats.

      When they arrived and the owners had left we corralled them only until the larger herd showed up. Funny thing tho the newbies never left with the others.

      They stayed at the corrals, sometimes for several days waiting for handouts. Only after growling stomach pangs did they venture out into the pasture for fresh grasses.

      If only govt. dependent humans would act the same.

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