Tell me and I forget. Teach me and I remember. Involve me and I learn. Benjamin Franklin

Sunday, November 9, 2014

Privatization: Profiting At Public Expense

By Duncan Cameron

Popular Resistance - November 8th, 2014

In the 1980s governments began selling off public assets to private corporations. Government debt and deficits were the excuse. Citizen-owned wealth, held in trust by governments was transferred to profit-seeking companies. Public inheritance was turned into a one-time payment applied to the provincial or federal debt.
This practice was called privatization. It should have been called theft, since it amounted to stealing from the public what belonged to it.
The only way the practice of “selling the house to pay the mortgage” made any sense was if you were the one buying the house.
In 1994 the Saskatchewan government privatized its Potash Corporation for $630 million. In 2010 a hostile bid priced it at $38.6 billion. The bid was considered “insulting low.”
The bid revealed that because of the privatization of what belonged to them, citizens of Saskatchewan had been cheated out of more than a 63-fold increase in the value of the Potash Corporation!
As the world price of potash resources rocketed, PotashCorp profits had gone sky high. Money that could have been used to build hospitals, schools, and cultural and recreational facilities left the province, to the delight of the absentee landlord.
The government collected some taxes and charged royalties. But government revenues represented much less than the citizens of Saskatchewan were entitled to as owners of the natural resources.

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