Public Ownership of Public Goods
Don't just soothe the profit motive. Kill it.
You don’t get a bill when a fire truck comes to your house. You do get a bill when an ambulance comes to your house. The only reason why this strikes anyone as normal is custom. Fire departments are publicly owned. They are a service that the government provides to all of us. If, a hundred years ago, fire departments had become private businesses, so that anyone whose house caught on fire also got stuck with a $5,000 bill for extinguishing services, then people living today would mostly accept that as the natural state of affairs. It is easy to see that America’s division between public and private services does not follow any rule at all, except this: Under capitalism, the private sector will try to take over all services, always, and only constant government action will keep public services public.
Do I need to say that this is stupid? This is stupid. If you were designing a common sense rule to govern what services should be publicly owned, it would be something like, “The public should own the things that all the public uses.” In fact, I think that if you asked most people, you would find that they already take this for granted, whether they have thought much about it or not. Why is the fire department public and not private? Because anyone might need it at any time. It’s a common good. It makes sense to be publicly owned. This is also why the police department is public. It is why parks are public. It is why the postal service is public. It is why schools are public. It is why most roads are public. It is the basic rationale for most of the things that the government controls and runs and provides to the public as a service. It is common sense.
A moment’s contemplation of this basic principle is enough to make you start wondering about all the things that aren’t public. Within the group of “Things that everyone needs more or less equally,” why is there such an arbitrary division between the publicly run things and the private ones? Why do we get firefighters, but not doctors? Why parks, but not stadiums? Why roads, but not banks? Why not, you know, food? When you take a vital service and privatize it, you ensure that it will run according to a private profit motive rather than running with the goal of providing the best service to the public. America’s health care system is the most glaring example of the human cost of this. The aggregate number of years of human life that we sacrifice in order to allow a relatively small number of people to get rich off of owning and selling health care is a staggering moral crime. The underlying principle, though, applies across many other less flashy goods and services. Whenever we see the weak, corrupt leaders of a poor country sell off public concessions to their well-connected cronies, we shake our heads. (Russian oligarchs, the scum!) But when we have allowed the same mechanism to persist in our own country for generations, building entire industries and stock market sectors atop of the ability to profit by privatizing public goods, we often lose our ability to muster outrage.
I mention this on the occasion of Kamala Harris rolling out, for the first time, some of the planks of her economic policy platform. It is a progressive platform. It is quite incomplete, which I guess is to be expected at this stage (Elizabeth Warren did not have that problem, but whatever), but it has good things. Rather than critique every point of it, I want to just prod all of us who think of ourselves as progressives to think less in the direction of subsidizing public goods, and more in the direction of public ownership of public goods.
Psychologically I think most progressives start from a place of “Let’s help needy people” and that is often translated into policies that amount to “let’s help needy people buy these things.” Food stamps to subsidize food. Medicaid to subsidize health care. Subsidized subway rides. Subsidized child care. Etcetera. Though such policies are better than just throwing needy people to the sharks of capitalism, imagine instead if we channeled an equal amount of political capital into pulling these vital goods out of the private sector altogether. Public food systems that are not burdened by price markups before the food reaches the consumers. Public health care systems focused on maximizing the delivery of patient care rather than on maximizing profits. Child care offered through the public school system. Public summer camps. Public green energy that offers electricity at cost. Publicly owned telecoms for your internet service. Once you start brainstorming, the list can go on and on. Matt Bruenig made an almost offhand comment in his analysis of Harris’s economic policies that illustrates the point. Referring to her vague plan to ban “price gouging” on groceries, Bruenig wrote, “A better idea would be for the federal government to spend about $45 billion to purchase Kroger. This would allow it to directly set the prices for the second-largest grocery store chain in the country.” This is the sort of comment that makes professional policy people in DC say “Haha,” but should really make us all say, “Why not?”
Let me pause here and note that it is difficult to have this conversation in any public forum without it quickly spiraling into absolutism and then directly into uselessness. Broach the subject of public ownership of currently private industries and on one side you will have people saying “This is communism” (as if that is the end of the conversation) and on another side you will have lefties saying “This isn’t enough communism.” Neither of these are very useful paths forward. We should stipulate that the US is not going to enter full communism any time soon, so we can confine ourselves to the horizons—however faint!—of political possibility. On the other hand, those horizons are being constantly pushed leftwards to an extent that people whose political frame was set 20 or 30 years ago may find hard to reckon with. The White House Council of Economic Advisers in the Biden administration was on some issues to the left of where the leftiest Democrat in Congress might have been during the George W. Bush administration. Things change. Progress happens. Ideas begin as fringe and through the force of logic migrate into the mainstream. That’s how stuff changes. “Fully abolish slavery? That would be economically devastating. There’s no use tossing around these utopian fringe ideas. Let’s stay focused on the Missouri compromise.” You know how this goes.
For now, I would be happy just planting the seed in the mind of the broadly defined left wing of America that we should have the instinct of taking public goods out of the private market, rather than just asking the government to spend money to help people afford them. Don’t just soothe the profit motive—kill it. Yes, choices have to be made. Priorities have to be set. But there are many examples around the globe of higher tax societies with a much stronger set of publicly owned goods and services that produce a higher quality of life for a greater proportion of their population than we do here. In general the tradeoff is not that if you do this you’ll be living under the grim bootheel of totalitarianism; it’s that there will be fewer extremely rich people.
Since at least the middle of the 20th century, there has been a concerted effort to make this entire conversation politically radioactive. Decades of rising inequality, though, have a way of making those blanket charges of “communism” feel less scary. A standard retort against government-run industries is that they will be less efficient than privately owned industries, provide worse service, produce a miserable experience for you, the consumer. Bullshit. For one thing, private companies do an excellent job of providing a miserable experience for the highest possible price already. (This is reminiscent of how greedy unions are always blamed whenever a unionized company goes bankrupt, which ignores the much greater number of non-union companies that go bankrupt.) For another thing, the people who run companies—whether those companies are owned by private investors or by the government—respond to incentives. If Kroger were publicly owned, to use the example above, you can give its managers contracts that award them financial bonuses based upon keeping prices low and getting good scores on customer satisfaction surveys, rather than on keeping profits and the stock price high. See how that works?
There is also the common assumption that public systems are naturally shittier than private ones. That is an observation of current reality masquerading as a principle. Yeah, the public systems in America are often shittier, because we allow all the rich people to opt out of them and use private systems and then the public systems are left exclusively for the poor. Make everyone use the public system, and the public system will get better. Duh.
Think bigger about what should be ours. We all pay taxes to create a democratically run government that provides vital goods and services in the name of the public good. That’s the goal. The hungry mouths of capitalism will never stop trying to nibble their way in to all of these goods and services. Public roads become toll roads. Public beaches become members-only. Cash-strapped state and local governments privatize public services in exchange for a quick cash infusion, due to either desperation or destructive free market ideology or plain old corruption. The federal government, at the center of everything, wielding a printing press for money, has the power to not only stop the constant assault of privatization, but to begin pushing the boundaries of public ownership outwards, further into the economy, covering more things for more people. Having this as a baseline goal will help us craft policies that don’t just stave off capitalism’s relentless tendency towards inequality momentarily, but stop it permanently. Public goods for the public. Keep it in mind.
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This year I published a book called “The Hammer,” about the labor movement and how it can save America. The book tour is still rolling, baby! Below is a list of upcoming book events. I would love for any of you to come out and see me if I come to your area. Let’s talk about solutions baby. Let’s build. Check it out:
Saturday, August 31: Wheeling, West Virginia. I’ll be speaking at the Reuther-Pollack Labor History Symposium at 11 a.m. Tickets and event info here.
Thursday, September 5: Las Vegas, Nevada. At The Writer’s Block at 7 pm. In conversation with Ted Pappageorge, secretary-treasurer of the Culinary Union. Event link here.
Wednesday, September 25: St. Augustine, Florida. I’ll be speaking at Flagler College in the evening. Event link to come.
Thursday, September 26: Gainesville, Florida. At The Lynx Books. Event link to come.
Sunday, September 29: Brooklyn, NY. At the Brooklyn Book Festival.
I’ll update this list with more info as it becomes available. For now, put me on your calendar if I’m coming to your area. I will write disgustingly complimentary things about you when I sign your book, if you ask me to.
I wrote a piece for In These Times this week about resisting the urge to turn the Kamala Harris nomination into a coronation and embracing dissent within the one non-fascist party. Related programming note: I will be in Chicago covering the DNC this coming week for Defector, another fine publication. You can read my coverage there. How Things Work will return after the DNC is over. Don’t worry.
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We could start by pulling the non-profit hospital systems of our country out of the strange middle-space they currently occupy b/t private and public. We don’t have to cut any ties of private ownership, snip away any connections to stock markets or shareholders. Something like 65% of our hospitals are non-profit across the country, benefiting each year from tax exemptions that are somewhere in the ballpark of 28billion dollars. The administrative class that operates these systems has worked over the last 25 years to consolidate all of our once community-based hospitals under the umbrella of a handful of management companies that ALSO take the tax exemption of non-profits. Consolidation has led to all sorts of monopolistic and monopsonistic practices that drive down the quality and drive up the costs of parient care. These C- suite execs make millions and millions and millions for operating what is ostensibly a public system with no private ownership structure, as though it is a totally private system. So start there. It’s ripe for conversion.
Regarding the Kroger comment, I think it's worthwhile presenting and discussing ideas like that that are out of the mainstream. I just had a conversation with someone where they and their friends suggested creating a new "anti-gouging" law to enforce against companies like grocery stores, but then they got stuck in the nitty gritty details of "wait, but you'd have to make it really specific and well-defined so it wouldn't harm businesses acting in good faith, or who actually are affected by inflation, etc.". The conversation quickly got derailed by the difficulty of adding more regulation and I think that's somewhat indicative of moderate liberal thinking.
Regulation isn't the only solution! Or even the best solution in some cases. There are already anti-trust laws that if enforced would prevent the market consolidation we see. We could use them to undo the consolidation that was illegally allowed to happen. Companies use their monopoly power to raise prices. And there are already anti-collusion laws as well if separate companies coordinate to raise prices. But I think a lot of people get stuck on the mechanism of "if there's a problem, we need to pass a new law to stop it".
None of this is to argue with your points. I agree there is huge room for public ownership or cooperative ownership models across the US. There are so many good ideas that aren't being discussed as broadly as they need to be.