Los Angeles (July 31, 2006) – Former British Prime Minister Margaret Thatcher, Indiana Gov. Mitch Daniels, South Carolina Gov. Mark Sanford, and former Indianapolis Mayor Stephen Goldsmith are just a few of the leaders detailing how privatization and competition are saving billions and making government smaller and more effective in the 20th anniversary edition of Reason Foundation’s Annual Privatization Report. The Wall Street Journal editorial page says this year’s Annual Privatization Report chronicles a “sweeping economic trend” and shows “the [privatization] story over the last 30 years is one of remarkable progress.”
Thatcher, who pressed forward with hugely successful privatization efforts in the U.K. despite fierce opposition, proclaims, “State control is fundamentally bad because it denies people the power to choose and the opportunity to bear responsibility for their own actions. Conversely, privatization shrinks the power of the state and free enterprise enlarges the power of the people.”
Not long after his election, Gov. Daniels saw bureaucracy wasting taxpayer dollars in Indiana: “Six departmental print shops sat side by side a few blocks from the nearest Kinko’s; the state owned one motor vehicle for every three employees,” Daniels writes in the Annual Privatization Report. “Predictably, dysfunction and inefficiency were rampant.”
So Daniels turned to competition. After competitive bidding, the cost of prison meals plummeted from $1.41 per meal to just 98 cents. “We have applied the ‘Yellow Pages’ test (if you can find a service there, maybe government should not try to do it itself) to a host of activities, ranging from janitorial service (annual savings = $500,000) to debt collection of delinquent taxes (achieving a return of 16:1),” Daniels explains.
Daniels is also on the leading edge of a major emerging trend: selling toll roads. A 75-year lease of the Indiana Toll Road generated $3.85 billion in revenue for the state. And today, private companies are set to pour over $25 billion into toll roads in six other states, including Texas, Virginia, and Georgia.
Robert Poole, Reason’s co-founder, advised Indiana on the deal and is the nation’s pre-eminent toll road expert. Poole’s detailed plans to use public-private partnerships, high-occupancy toll lanes, managed lanes, and truck-only toll lanes to solve our traffic woes are now being implemented by cities across the country. The New York Times declares, “For 17 years, Mr. Poole has been the chief theorist for private solutions to gridlock. His ideas are now embraced by officials from Sacramento to Washington.”
Poole and Reason have tirelessly advanced “free minds and free markets” and the power of competition for over 35 years. And this year’s Annual Privatization Report finds governments are increasingly turning to competition and privatization for results. From 1990 to 2003, governments generated over $400 billion in revenue from privatization; 1,337 U.S. municipalities now contract out some, or all, of their water and wastewater operations; and 40 countries have commercialized their air traffic control systems since 1987.
The Annual Privatization Report provides in-depth analysis of numerous other developments across the globe, including: the President’s Management Agenda, which the report finds has produced 1,060 federal competitions involving over 41,000 jobs the past three years and will generate a net savings of $5.6 billion for taxpayers over the next three to five years; the progress of Sandy Springs, the first new city in Georgia in over 50 years, and its decision to contract out nearly every government service; over 3,600 charter schools now serving over one million U.S. students; foreign management of U.S. infrastructure in the wake of the Dubai Ports deal; and the growing public pension crisis that threatens state budgets and individual retirement security.
Full Report Online
You can find the full Annual Privatization Report online at www.reason.org/apr2006.
Additional Annual Privatization Report Links and Resources
» Margaret Thatcher: Rebuilding an Enterprise Society Through Privatization
» Gov. Mitch Daniels: Reforming Government Through Competition
» Gov. Mark Sanford: Advancing Limited Government, Freedom, and Markets
» The Wall Street Journal Editorial: Socialism in Reverse
Reason Foundation is a nonprofit think tank dedicated to advancing free minds and free markets. Reason produces respected public policy research on a variety of issues and publishes the critically acclaimed monthly magazine, Reason. For more information, please visit www.reason.org.
Chris Mitchell, Director of Media Relations, Reason Foundation, (310) 367-6109