'Free' market myths no.1: the public sector doesn't create wealth

This is the first in a series of posts which aim to explode the common myths of neoliberal 'free' market propaganda. Something you can read in the Daily Mail, Times, Telegraph, Sun, and Daily Express any day of the week. If you want to find out more about the mythology of the 'free' market right I recommend the excellent '23 Things They Don't Tell You About Capitalism' by the economist Ha-Joon Chang. Its essential reading to understand how modern capitalism portrays itself as dynamic and risk-taking, when it is more often conservative and protectionist:

In the UK, in the past decade or so, and particularly since the big crash of 2008, there have been increasing attacks on the public sector. Neoliberal 'free' market fanatics have been working hard to paint the public sector as a drain on our national resources, something which is an unaffordable luxury populated by workers on fat cat salaries and pensions. We are routinely told that only the private sector can create wealth. This is nonsense, and is demonstrably false. But why is it happening?

The reason is that corporations want to get their hands on public sector assets at knockdown prices, and see providing public services as very easy money. This is because public services are monopolies.  For example, your local council has a waste collection (and disposal) contract with one company. You don't see refuse wagons tearing down your street competing to pick up your bins, do you? Its a monopoly and therefore very easy money compared to the supposed cut-throat world of capitalism, where businesses are supposed to be competing for survival. So, the public sector represents rich and easy pickings for 'free' market 'entrepreneurs'.

Rubbishing the public sector is all about getting the public onside to accept the asset stripping of privatisation, which is based on sacking workers, reducing the conditions for those who remain, and dumping the costs of unemployment and hardship onto wider society. This is the time-honoured 'free' market trick of privatising the profits and nationalising the losses, in other words - a racket.

The reality is that the public sector creates jobs, infrastructure and wealth and a vibrant public sector is essential to a healthy economy. A public sector that is efficient and well run offers much better value for money than the private sector ever could. Why? Its simple, the public sector doesn't have to make a profit and therefore will always provide better value for money than a private sector alternative. That is why the 'free' market fanatics are so desperate to convince you the opposite is true.

Neoliberal 'free' market fanatics don't really understand the concept of wealth anyway. They think in terms of profit, cash and personal gain. But real wealth is not about money, its about much more than that, it's about human need and well-being. The public sector creates wealth in many ways, through health, education and welfare, through infrastructure and creating jobs both in the public and private sector. Without it we would all be at lot worse off. The NHS is the greatest engine of wealth creation in the UK and plays a crucial role in our economy.

 If we allow our public sector to be privatised it will become hollowed out. Do you really want the education of your children to be reduced to the level of a transaction at Tesco or Barclays?  If you privatise these crucial services, you reduce them to the level of a mere commodity, a financial transaction, and you become merely a customer, rather than a stakeholder, an owner. But you can never expect the 'free' market fanatics to understand that level of subtlety, for them humanity is reduced to mere units of consumption. That is your function, to provide them with profits. Their  ideology is ultimately anti-human, like George Orwell's Room 101, and the boot stamping on the human face -  forever.

The Tories will destroy the NHS

The Tories are now able to do something they have been dreaming about for years - the destruction of the NHS. Make no mistake about it - that is what privatisation of the NHS means. What makes the NHS unique is that it is a public service, publicly provided, and something we all pay collectively for. It's a great idea and it means that millions of people have access to decent healthcare who otherwise wouldn't be able to afford it. The NHS is not perfect but, despite what the 'free' market fundamentalists would have you believe, it is still the envy of the world. Who wouldn't want a health service free at the point of delivery?

So, the NHS isn't perfect but what could be any better? Many of the problems of the NHS are because of  to the chronic underfunding it received under 18 years of successive right-wing Tory governments. Governments who believe that what you get should be based on your ability to pay, and that everything should be subsumed to the market its easy to run down public services so that they become unpopular with voters. That is what happened to health, education and the railways in those Tory years. Despite this neglect the NHS still remained popular.

What the marketeers want is a private take-over of the NHS. The NHS brand will remain as a fig leaf behind which the profiteers will be lurking. So what is wrong with privatising the NHS and introducing competition as the Coalition government proposes? The answers are well known. Private corporations will cherry pick the most 'profitable' parts of the NHS, leaving the difficult and expensive stuff to the public sector. The NHS will, in effect, be broken up. Costs will rise and quality will fall. The private sector has extra costs not borne by the public sector: marketing, administration, and of course profits. Healthcare in the UK costs half of what it does in the USA because of this. The NHS will become unaffordable leading to call for people to take out insurance on top of the taxes they already pay. We will end up paying more for less.

Anyone who doubts this should watch Michael Moore's excellent documentary Sicko which shows how individuals and families are bankrupted by healthcare costs, how many people suffer because they can't afford drugs or routine operations, and how the insurance companies avoid paying up. We must defend what is the most important of public services. Get involved and join the fightback against this shameful proposal which will destroy our most important institution.