Out of Control Policy Blog

Public Greed

Left wing bumper sticker lovers may have to modify the old favorite, “Human Need Not Corporate Greed” to “Human Need Not Public Greed.” A common criticism of privatization is that private firms care more about their bottom line than the public good, but now Buffalo might help bring this stereotype to the public sector.

City officials are eyeing a possible takeover of emergency medical service transport because they claim it would generate $8 million per year in additional revenue. Like so many city governments these days, Buffalo is "cash-starved."

The move would essentially un-privatize the city’s current system. And there is apparently no debate about the private firm's performance (at least the article doesn’t mention any). The city’s argument is that it wants more money, pure and simple. But what about the public good?

Performance, not cost, is usually the most compelling reason to change an EMS system. And booting out privatization will likely restrict –- or even eliminate –- competition, thereby restricting the greatest incentive to maintain top-notch performance. If the city takes over EMS and does a lousy job, what then? Under proper privatization, a city can hold an EMS provider to strict performance measures. Periodic review of contracts means that the provider must always perform well if it wants a renewal.

And if they’re interested in cost cutting, why are Buffalo officials talking about a city-run service? Forget about the city's start-up costs of buying ambulances and training fire fighters -- it’s not like local governments are paragons of efficiency to begin with. Turning to government for efficiency lessons is like tapping Marlin Brando for diet tips.

If Buffalo really wants to save money, it should privatize more services, not less.

Ted Balaker is Producer


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