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Private/Public Sector



" These institutions, in turn, helped create what we now call civic society: that space between the state and the individual that is filled by unofficial, voluntary, and philanthropic endeavour. "

   --  Daniel Hannan

There is no such thing as a private or Public sector.
  • Private sector are owned by the public sector to the degree that the government tax and regulate the companies.
  • Public sector are private to the extent that they outsource operations and employ private individuals.
For all of the public jobs created by public investment, rather more jobs will quietly disappear from the private sector in consequence.


Government investment in industry involves spending other people's money on somebody else. Since it is not their own money, the politicians and bureaucrats
  • Do not have the same incentive to make good and wise decisions as do those whose livelihood or reward depends on success. 
  • They do not have the same drive to ensure that the goods produced will be of the quality and price to hold their own in the marketplace. 

Government investment is usually called for when private investment has failed to materialise in support of certain industries.
There is a very good reason why it did not appear; it is because private investors had low expectation of any returns to be made by doing so. 
When government does invest the industries concerned become dependent on continual state handouts and unable to attract private funds in its place. The graveyard of Britain's industrial history is littered with the corpses of failed state investments, whether in steel, ships or motorcycles. Government investment in an industry is the kiss of death.


Politicians need to consider that they don't have to nationalise to make a national service.

Food provision is much more important than many other things people want the government to provide. But imagine what the food situation might be if most people were dependent on government supplied food, financed out of taxation, run by the bureaucracy, and available only from approved supply outlets. 
Even though food is very important, the private market is much more capable of guaranteeing us the appropriate supply than would a state planned system.


The politicisation of public sector pay bargaining is an inefficient and potentially harmful means of determining wages.


Subpages (2): Nationalisation Privatisation
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