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User Forum Topic
Submitted by flu on July 18, 2013 - 6:54pm

Submitted by CDMA ENG on August 7, 2013 - 7:46pm.

CA renter wrote:
CE,

Opinions are fine, but you assert yours as if they are factual. They are not. You have yet to offer up any data, evidence, or logic to back up your claims, no matter how many times I've asked for anything factual or logical that would in any way prove your point.

The reason my posts are long is because I present facts, data, and logic (and there are plenty of facts and data to be found if you would only bother to look, which you don't for some reason). Apparently, you find facts bothersome. Perhaps we should debate using only "opinions," then?

The reason you consistently refuse to debate is because you can't. There is nothing to back up what you've claimed, so you choose to make personal attacks, instead. You lose.

Bullshit. I have NEVER made a personal attack so do not claim as such. Arguing with you is pointless so I choose not to... again if you read some to the "facts" that you proclaim I believe many readers would say that they are counter points to your claims.

Cutting and pasting articles from the web pretty much counts as opinions.

As far as personal attacks go... In the past I said that I believe you are misguided... But at least your heart is in the right place.

CE

Submitted by CA renter on August 8, 2013 - 12:42am.

CE,

Believe it or not, my mind is open about this issue. If you (or anyone else) can prove to me that there is a net benefit to society when we privatize government assets, cash flows, and services, I will gladly change my mind. Until then, all anyone has ever offered is the same old rhetoric and propaganda from the privatization movement (who stand to benefit greatly...at the expense of taxpayers, consumers of government services, and workers), without any actual evidence to back up their arguments.

Feel free to use the articles that I've linked, most with supporting data citing the major studies regarding the problems with privatization. If you've found something there that counters my claim, please feel free to point it out.

And I may be wrong, but weren't you part of the group who liked to refer to BG and I as the "anvil sisters," because we have differing points of view -- with both of us having worked in the public sector. And if I'm misguided, please clarify things for me so that I can get a better understanding of privatization and how it will save taxpayers money **in the real world** (vague theories and opinions don't count). I follow these things very closely, and have never seen any evidence to support your claims, but you seem to think that you know more about it than I do...so please show us the evidence that supports your claims.

Submitted by livinincali on August 8, 2013 - 6:40am.

CA renter wrote:

Believe it or not, my mind is open about this issue. If you (or anyone else) can prove to me that there is a net benefit to society when we privatize government assets, cash flows, and services, I will gladly change my mind. Until then, all anyone has ever offered is the same old rhetoric and propaganda from the privatization movement (who stand to benefit greatly...at the expense of taxpayers, consumers of government services, and workers), without any actual evidence to back up their arguments.

I can envision a scenario where privatization of a government service would be more efficient, but most privatizations are not done in that manner. For the most part a privatization is a transfer of a government run monopoly to a private run monopoly. It's the easiest to implement and the less disruptive to the people receiving the service.

Suppose the following scenario. City of San Diego gets rids of free trash pickup and opens up trash pickup to whoever would like to do it. Citizens would be responsible for picking and paying for a trash pickup service based on their need. You might see some people elect to drop off trash at the city dump themselves or they might elect to have somebody do it for them. You create quite a few low skilled jobs in the process and quite a few entrepreneurs that want to run trash hauling services.

After the initial disruption and turmoil this system would likely function at a lower cost and more efficiently than the current city system of picking up trash once a week on a scheduled day. Of course that disruption would be a painful process. Trash would likely pile up at some homes, illegal dumping would rise and other negative consequences would come out of it initially, but after a few years we's likely find a nice balance.

Of course we'd never privatize in that manner because of those initial disruptions. Instead we'd likely hand a contract to one of the big existing commercial trash haulers and they would likely cost about the same. In their case the owners would likely get rich and the employees would suffer. But on the other hand if you opened it up to all comers and let the market figure it out you'd likely find cost savings and efficiency.

Submitted by spdrun on August 8, 2013 - 7:17am.

A system as you're describing is pretty common in rural American. I know people who own a farm in rural VT -- they have to make a weekly dump run (or burn anything that's paper/compost organics).

Submitted by SK in CV on August 8, 2013 - 7:47am.

livinincali wrote:
CA renter wrote:

Believe it or not, my mind is open about this issue. If you (or anyone else) can prove to me that there is a net benefit to society when we privatize government assets, cash flows, and services, I will gladly change my mind. Until then, all anyone has ever offered is the same old rhetoric and propaganda from the privatization movement (who stand to benefit greatly...at the expense of taxpayers, consumers of government services, and workers), without any actual evidence to back up their arguments.

I can envision a scenario where privatization of a government service would be more efficient, but most privatizations are not done in that manner. For the most part a privatization is a transfer of a government run monopoly to a private run monopoly. It's the easiest to implement and the less disruptive to the people receiving the service.

Suppose the following scenario. City of San Diego gets rids of free trash pickup and opens up trash pickup to whoever would like to do it. Citizens would be responsible for picking and paying for a trash pickup service based on their need. You might see some people elect to drop off trash at the city dump themselves or they might elect to have somebody do it for them. You create quite a few low skilled jobs in the process and quite a few entrepreneurs that want to run trash hauling services.

After the initial disruption and turmoil this system would likely function at a lower cost and more efficiently than the current city system of picking up trash once a week on a scheduled day. Of course that disruption would be a painful process. Trash would likely pile up at some homes, illegal dumping would rise and other negative consequences would come out of it initially, but after a few years we's likely find a nice balance.

Of course we'd never privatize in that manner because of those initial disruptions. Instead we'd likely hand a contract to one of the big existing commercial trash haulers and they would likely cost about the same. In their case the owners would likely get rich and the employees would suffer. But on the other hand if you opened it up to all comers and let the market figure it out you'd likely find cost savings and efficiency.

The only way this change would result in a net creation of jobs is if the private sector was LESS efficient than the city. All the current city waste employees would lose their jobs. The private sector will only do it if the work is profitable. I would assume that many current city waste workers would pick up work in private industry, probably at lower wages. But I doubt the cost to consumers would be less than the current cost to the city. A single provider will always be more efficient in providing service than multiple providers. (A single truck in each neighborhood v. multiple trucks from competing services in that same neighborhood.) Personally, I'd rather have the higher wages going to the city workers and cut out the profit.

Submitted by SD Realtor on August 8, 2013 - 7:59am.

SK I think your assumption is incorrect because you are neglecting to factor in the recurring fees that stick with the taxpayers long after that city employee retires. It may be a wash for the actual cost of running the business but the long term cost to the consumer is substantially less.

So I would rather pay the private company to do the job, even if it a little bit more costly now, rather then fund the garbage man's pension and health care for life.

Submitted by SK in CV on August 8, 2013 - 8:18am.

SD Realtor wrote:
SK I think your assumption is incorrect because you are neglecting to factor in the recurring fees that stick with the taxpayers long after that city employee retires. It may be a wash for the actual cost of running the business but the long term cost to the consumer is substantially less.

So I would rather pay the private company to do the job, even if it a little bit more costly now, rather then fund the garbage man's pension and health care for life.

If done correctly, the pension costs are annual expenses, not perpetual. I acknowledge that it hasn't efficiently been done that way in the past. Though come to think of it, I have no idea how well funded the city of SD pensions are. If they're fully funded, there are no perpetual costs.

If it's a little bit more costly now, it will be much more costly in the future. Guaranteed. As soon as Waste Management has 50% of the market, they'll jack up prices.

Submitted by SD Realtor on August 8, 2013 - 8:32am.

I think there is ample evidence to show they have not been done correctly. Similarly I believe it is impossible to correctly forecast the cost of future liabilities more then a year or two in advance and then accurately predict that a given return will cover those liabilities. To compound that problem and guarantee a given return is foolish. Furthermore there is no incentive for pensions to be run correctly given that they will be bailed out by state and now even federal coffers. Why not take the higher risk for a better return? We don't make enough to fund the liability with a less risky yield, and if we lose the money it will be covered so what the hell does it matter?

Also you may want to read up on the financial health of the SD pensions especially with respect to unfunded liabilities.

Similarly given the financial health of most large municipalities across the nation with respect to pensions and unfunded liabilities, evidence would indeed corroborate that pension costs are perpetual expenses, and unfunded liabilites have sky-rocketed. The ony strategy the municipalities have is to dump retirees off to Obamacare.

I would rather pay for the service as provided. If I don't like the cost I will haul the crap to the dump and pay the dump fees.

Submitted by The-Shoveler on August 8, 2013 - 9:14am.

The other elephant in the room with regard to adequate funding is Pension spiking.

This got so bad in L.A. It was epidemic!!
The last mayor was trying to reform to end the practice but I am unsure if they actually passed it.

They were going to raise the retirement age to 65 as well

Well at least CalPers did end that.

Submitted by SK in CV on August 8, 2013 - 9:17am.

SD Realtor wrote:
I think there is ample evidence to show they have not been done correctly. Similarly I believe it is impossible to correctly forecast the cost of future liabilities more then a year or two in advance and then accurately predict that a given return will cover those liabilities.

Bolderdash. Annuity companies have been doing it for generations. You want to argue that pensions are too high? Fine. You may have a point. You want to argue that pension funds and current funding have been mismanaged? Fine. You're probably right. You want to argue that return assumptions have been too high? Fine. It's arguable. (The city pension fund has earned 8% per year the last decade.) None of those refute the fact that annuity companies have accurately and successfully predicted future costs, some for over 100 years.

Submitted by Leorocky on August 8, 2013 - 9:27am.

You are correct. There are 2 problems with "privitazation" and both lie with the politicians and their cronies who implement it.

1 - it rarely happens in the manner you just described. In your scenario some people might have to pay more for trash p/u. Some less. Some will do it themselves. Point being, it's up to us.

What usually happens is the city locks in a contract with a private sector entity that you are required to use. We're told they are picked based on cost but in reality it's whomever wined and dined the right people.

Sure the contract looks good on paper - youre replacing a bunch of unionized workers with $12/hr workers. But the same government mentality seeps in.

"the contract assumes X% growth in population such that in 15 years garbage p/u will have doubled....sounds good to us"

because we all know that home prices and the market and wages always go up in a straight line, right? And innovation never occurs. Nothing ever changes.

2 - when the privitazation occurs the upfront payment and the savings are just tossed back into the system to pay for shortfalls or new spending instead of immediately being returned to taxpayers. If they want that savings for other things let us vote on it.

Also, instead of canning the old garbage men we insist they get picked up by the private co (increasing their costs) or moved to other city jobs where they keep their pay and bene's.

Submitted by no_such_reality on August 8, 2013 - 9:33am.

Privatization runs into many of the same problems outsourcing does. They fail for a very simple reason. The entity that is privatizing or outsourcing doesn't allow the provider to improve or change the process.

They take a broken process, move it to a new provider and keep a management layer to oversee the new provider and then wonder why it isn't cheaper and service is decreased when the new provider needs to follow the exact same procedures that the original provider followed.

Submitted by SD Realtor on August 8, 2013 - 10:02am.

Except that annuity companies are not backstopped by taxpayers.

Submitted by SK in CV on August 8, 2013 - 10:10am.

SD Realtor wrote:
Except that annuity companies are not backstopped by taxpayers.

Whole different issue. That's immaterial to your claim that it's "impossible to correctly forecast the cost of future liabilities more then a year or two in advance and then accurately predict that a given return will cover those liabilities."

It IS possible.

Submitted by SD Realtor on August 8, 2013 - 10:38am.

Perhaps I should revise. Forecasting costs given a smaller finite set of parameters is possible. Private companies do indeed seem to do it well. Much better then the public entities. Especially when healthcare is involved.

Yes so one statement out of all the other points I made was arguable. All of the other ones do indicate that the way that it is being done now does not work and costs the taxpayers alot of money. Furthermore that the amount that is being heaped on the taxpayers could grow dramatically based on the outcome of future court cases as more municipalities fall by the wayside and look for ways to keep those pension checks rolling.

Submitted by livinincali on August 8, 2013 - 11:53am.

SK in CV wrote:

The only way this change would result in a net creation of jobs is if the private sector was LESS efficient than the city. All the current city waste employees would lose their jobs. The private sector will only do it if the work is profitable. I would assume that many current city waste workers would pick up work in private industry, probably at lower wages. But I doubt the cost to consumers would be less than the current cost to the city. A single provider will always be more efficient in providing service than multiple providers. (A single truck in each neighborhood v. multiple trucks from competing services in that same neighborhood.) Personally, I'd rather have the higher wages going to the city workers and cut out the profit.

My assumption is that many different competing providers would eventually figure out a more efficient process than the current weekly pickup. Initially it might be more ineffecient and fuel the creation of jobs but as various competitors figure out better processes those that cannot compete will fold.

A single provider is not always better because a single provider has no incentive to innovate. That's like saying if Microsoft could be the only operating system provider everything in software would be more efficient. Do you really believe that?

Submitted by SD Realtor on August 8, 2013 - 2:07pm.

Sounds like there should be no private entities then because any service industry that has multiple providers is less efficient then a single entity.

Hmmm curious logic.

Submitted by FlyerInHi on August 8, 2013 - 2:32pm.

I have my primary residence in las Vegas. Nobody is ever home on trash day, so we take the trash away ourselves. I still have to pay republic services (private
company) for trash pick up although they don't provide any service. It you have water sevice, trash is mandatory.

Submitted by SK in CV on August 8, 2013 - 4:20pm.

SD Realtor wrote:
Sounds like there should be no private entities then because any service industry that has multiple providers is less efficient then a single entity.

Hmmm curious logic.

I was specifically talking about residential trash pick-up. And yes, it's perfect logic. Everyone gets almost identical service, differing only in the number of trash cans. You tell me, which would be more efficient, one provider stopping at every house once a week or 10 different providers driving the exact same route every week, but stopping, on average at every 10th house?

Submitted by njtosd on August 8, 2013 - 4:36pm.

SK in CV wrote:
SD Realtor wrote:
Sounds like there should be no private entities then because any service industry that has multiple providers is less efficient then a single entity.

Hmmm curious logic.

I was specifically talking about residential trash pick-up. And yes, it's perfect logic. Everyone gets almost identical service, differing only in the number of trash cans. You tell me, which would be more efficient, one provider stopping at every house once a week or 10 different providers driving the exact same route every week, but stopping, on average at every 10th house?

SK - you are completely missing the importance of competition for keeping price down. A single supplier is also known as a monopoly - and few want that. Somewhere between one and a billion suppliers is optimal, depending on what the good or service is.

Submitted by SK in CV on August 8, 2013 - 6:33pm.

njtosd wrote:

SK - you are completely missing the importance of competition for keeping price down. A single supplier is also known as a monopoly - and few want that. Somewhere between one and a billion suppliers is optimal, depending on what the good or service is.

I'm not missing the point at all. We're talking about a very specific service, trash pickup. Not making cars or cell phones or spa services. If you don't think those in management, even in civil service jobs, aren't concerned with keeping costs down, you're wrong. There may be no profit motive, but there is always pressure to spend less and deliver services more efficiently. And particularly with government contracted services, the motivation is always to deliver less service for more money.

Submitted by SD Realtor on August 8, 2013 - 7:09pm.

Hmmm... Several cities I have rentals in out of state have private trash collection. Seems like there is not an explosion of prices.

Submitted by SK in CV on August 8, 2013 - 8:04pm.

As you know probably know SDR, there are cities in SD county that don't provide trash collection. I'm pretty sure that Poway still contracts with EDCO to provide services. A single provider, and each homeowner must pay that provider directly. I'm pretty sure that I never said there would be a price explosion, only that a single provider is more efficient. Essentially that's what Poway has. (or at least had, it may have changed since I lived there) I suspect that residents of Poway are not paying any less than the city of San Diego does on a per residence basis. Given the two options, I'd rather have higher wages, lower corporate profit.

Submitted by paramount on August 8, 2013 - 8:31pm.

If you owned a monopoly, wouldn't you want to keep prices low?

Otherwise you invite competition.

Submitted by bearishgurl on August 8, 2013 - 8:59pm.

SD Realtor wrote:
Hmmm... Several cities I have rentals in out of state have private trash collection. Seems like there is not an explosion of prices.
Actually, Republic now picks up our trash in Chula Vista. They bought Allied Waste, who bought Laidlaw several years earlier. They pick up EVERYONE's trash in the incorporated area. For the 39 gallon TRASH bin, 90 gal recycle bin and 90 gal yard waste bin, they charge ~$29 bimonthly. HOWEVER, in the UNINCorporated areas (the closest one being ~3 blocks away), they charge over $72 for the same (bimonthly) service. This tells me that the CITY was and is subsidizing Republic (and earlier, Allied Waste and Laidlaw) for trash pickup. However, the charge does not appear on our tax bills as it does in some county unincorporated areas. This tells me it is subsidized by the CITY's general fund (partly derived from "Teeter funds" which are property taxes confiscated by the state and later returned to the cities and counties from whence they came.

Even though Republic (and its predecessors') main office is located at the Otay Landfill in Chula Vista, we are now required to send our bimonthly payments to Phoenix (snail mail only).

Go figure that one out. Is it a monopoly? I would say YES! Is it "unionized?" No. There is no "People's Ordinance" in place in the City of Chula Vista and the collectors are NOT "civil servants."

Hence, except for comm'l RE and large apt bldgs (who can choose their trash p/u provider), SFR and 2-4 unit owners cannot "choose" their provider in the incorporated area.

I would venture that SD East County cities have the same type of "contract" with EDCO (of Lemon Grove).

Folks, "privatization" doesn't always work out the way the "free-market" proponents think it "ought to."

In SD County, for all practical purposes, in the incorporated cities outside of the City of SD, residential trash collection is NOT a "free market" and never will be.

So get that silly notion out of your over-thinking heads.

Submitted by CDMA ENG on August 8, 2013 - 10:00pm.

CA renter wrote:

And I may be wrong, but weren't you part of the group who liked to refer to BG and I as the "anvil sisters," because we have differing points of view -- with both of us having worked in the public sector. And if I'm misguided, please clarify things for me so that I can get a better understanding of privatization and how it will save taxpayers money **in the real world** (vague theories and opinions don't count). I follow these things very closely, and have never seen any evidence to support your claims, but you seem to think that you know more about it than I do...so please show us the evidence that supports your claims.

Nope... Not me... I am not in that group. I think you are quite reasonable in most other areas. I will make no bones about the fact I think BG is nerotic. I don't like her and never have. But you do get a bit zealous, when discussing unions, and your mind is not open on this subject...

I am quite capable of being a jerk... This is just not that time.

Missed that bit of theater when they called you Anvil sister... funny though...

CE

Submitted by bearishgurl on August 8, 2013 - 10:53pm.

CDMA ENG wrote:
CA renter wrote:

And I may be wrong, but weren't you part of the group who liked to refer to BG and I as the "anvil sisters," because we have differing points of view -- with both of us having worked in the public sector. And if I'm misguided, please clarify things for me so that I can get a better understanding of privatization and how it will save taxpayers money **in the real world** (vague theories and opinions don't count). I follow these things very closely, and have never seen any evidence to support your claims, but you seem to think that you know more about it than I do...so please show us the evidence that supports your claims.

Nope... Not me... I am not in that group. I think you are quite reasonable in most other areas. I will make no bones about the fact I think BG is nerotic. I don't like her and never have. But you do get a bit zealous, when discussing unions, and your mind is not open on this subject...

I am quite capable of being a jerk... This is just not that time.

Missed that bit of theater when they called you Anvil sister... funny though...

CE

Uhh, I believe it IS "that time."

And I believe CE to be overly paranoid and borderline delusional ... due to a variety of issues he has previously admitted to here ... so take his posts with a grain of salt, folks...

Submitted by CA renter on August 8, 2013 - 11:45pm.

paramount wrote:
If you owned a monopoly, wouldn't you want to keep prices low?

Otherwise you invite competition.

You're missing entirely how endemic corruption is to privatization. Read about the history of privatization in various countries around the world and see what happens when privatization takes hold. Read about how privatization has resulted in poor outcomes here in our own country as well. Read the links from my posts above, or just Google, "Does privatization save money?"

The only thing privatization does is expand the wealth/income gap and concentrate power into fewer and fewer hands. It does NOT save taxpayers or consumers money. It will NOT result in more or better paying jobs for workers. Learn about the people and organizations behind the privatization movement to see why this is being pushed.

Submitted by CA renter on August 8, 2013 - 11:49pm.

SK in CV wrote:
As you know probably know SDR, there are cities in SD county that don't provide trash collection. I'm pretty sure that Poway still contracts with EDCO to provide services. A single provider, and each homeowner must pay that provider directly. I'm pretty sure that I never said there would be a price explosion, only that a single provider is more efficient. Essentially that's what Poway has. (or at least had, it may have changed since I lived there) I suspect that residents of Poway are not paying any less than the city of San Diego does on a per residence basis. Given the two options, I'd rather have higher wages, lower corporate profit.

Same thing in our area. We have to use Waste Management (~$40/bi-monthly).

And could not agree more WRT the higher wages for the people who do the actual work vs. paying the corporate heads and shareholders millions of dollars per year, instead.

Submitted by CA renter on August 9, 2013 - 12:19am.

SD Realtor wrote:
Perhaps I should revise. Forecasting costs given a smaller finite set of parameters is possible. Private companies do indeed seem to do it well. Much better then the public entities. Especially when healthcare is involved.

Yes so one statement out of all the other points I made was arguable. All of the other ones do indicate that the way that it is being done now does not work and costs the taxpayers alot of money. Furthermore that the amount that is being heaped on the taxpayers could grow dramatically based on the outcome of future court cases as more municipalities fall by the wayside and look for ways to keep those pension checks rolling.

SDR,

Just to be clear, the studies that show how privatization costs more or about the same (while reducing the number of good-paying jobs) do include costs for pensions and healthcare.

And it's not just annuities...insurance companies of all kinds would not be able to exist if they couldn't properly calculate costs vs. liabilities.

FWIW, the numbers for "unfunded liabilities" that have been bandied about are no more accurate than the "funded" status of the pension funds. In each case they are dealing with unknowns, with each having a different objective -- one to show how bad things could get (numbers from those pushing privatization/capital), while the other tries to show things in a more positive light (labor).

I'd also point out that current pension contribution rates are very much in line with historical norms. The Privatization Movement tries to compare today's contribution rates with those from the late 90s/early 2000s when many public employers were paying little to NOTHING in contributions toward employee pensions. THAT rate was the anomaly, not today's rate.

One more thing: I have *always* acknowledged that some changes need to be made. Pension spiking, retroactive pension increases, certain "garbage" add-ons, etc. need to be dealt with. And while I do not advocate for at-will employment for anyone (union or not), I do think that it should be easier to get rid of the few unionized employees who truly are parasitic liabilities.

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