I recently won a contest called ideas for Cuba. I decided to post what I send to users of the blog. The publication will be divided into 5 parts. Hope you like.
2-Privatizing state enterprises to make more transparent the functioning of public services
No need to read “The Wealth of Nations” by Adam Smith to know that private companies are more efficient than the state. Nor is it necessary to make an extensive study of economics to know that generally pay their workers better than for the public sector to do the same activity. While “Capital” of Karl Marx and Friedrich Engels is emphatic when judging the private sector labor exploitation, it is not required to conduct research in the area to have the notion that the state sector also operates.
The reason is basic efficiency and scope ranging from economics to the field of philosophy. In the economic case, private enterprise is better able to reinvest more of their profits by not having to comply with certain state contributions that go beyond the correct payment of taxes. also they increase their assets through the appropriate stimulus to the receipt of new revenue as investments broaden the scope of operational activities. In the philosophical sense, the fact that there is one or more owners to ensure the proper functioning of the business, raises the quality guarantees by the client because the line of action is to satisfy the interests of consumers, not political interests .
The situation of workers respond to these elemental desire to improve their individual and family situation. That’s why they choose to work where more income perceived and hence the image of the private sector is strengthened, as this need to give higher wages to get the public sector workforce. To further improve its situation, workers continue constantly evaluating job opportunities that are convenient. For example, a good chef evaluates the possibility of working in a restaurant where he is guaranteed a better wage offer and will work on this unless the owner of the business where he works equate supply. The reality is that the worker does not sell its workforce, but the auction.
This approach is impossible because the state company offers jobs have the same characteristics in each case as the only and unchanging state. But this may change.
Privatization is a process in which business activities are transferred from the public sector to the private sector, so that the government transfer its absolute control to private and independent operators each other. This process is performed in order to improve competitiveness.
It is important to note that this feature would only be done in the case of state-owned enterprises and non-public services such as education or health. Many people sympathize with the idea of privatizing these services, but in a metaphorical sense this would be to take the engine to an airplane in flight. At first we all consider lighter, but then feel the impact.
The form of privatization varies depending on each case. With small state enterprises would be enough to see them as partnerships, while the larger should go through an initial public offering in a stock exchange to constitute them as authentic international capital corporations. In this way the government would acquire financial resources that would be used to build the necessary infrastructure in energy, transport, telecommunications and water that would strengthen the competitive environment of the free market. The government would be a participant, not as an obstructionist talent and initiative, but as a catalyst for creativity in the new economic formation.
But then an interesting question arises. How would run public services if the government does not control the economic activity? This would work through an efficient tax system with progressive taxes on personal and corporate income and social security contributions. This concept is not new, it has been used for generations in developed and developing countries. But the really interesting in this principle is as resources acquired by the exchequer are directly proportional to the improvement of private activity. Thus the conditions of teachers, doctors, policemen, firemen, social workers and all those who provide useful services to society and are guaranteed by the action of a responsible and incorruptible government would be nourished.
Thus public services would be more transparent and efficient because the government, by not controlling the means of production, would have its functions and resources focused on the care of social needs.
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