Two tragedies have recently occurred in Canada, one which has been given much publicity, the other only a little. As the wrong lessons have been drawn from both, we do well to reconsider each case, and to more carefully consider what they portend.
One calamity occurred in Walkerton, Ontario, where an outbreak of E. coli bacteria eventuated in the deaths of seven residents and the sickening of thousands of others. The Conservative government of Premier Mike Harris was widely blamed for this episode, since it had previously contracted out to private sources responsibility for drinking water in the province.
The second disaster took place at an artificial lake at Birds Hill Provincial Park in Winnipeg, Manitoba. This was the drowning of 18 year old Katarzyna Zarzecki, who died while swimming and was unable to be rescued by the beach patrol. This comes hard on the heels of the drowning deaths of two small boys at the same facility during the summer of 2000.
As with the Walkerton cases, these deaths were also widely blamed upon privatization by the leftist media, because the life guarding responsibilities at this lake were also contracted out by provincial authorities to a for profit corporation.
My claim is that these tragedies in Ontario and Manitoba occurred not because of these privatizations, but in spite of them; that the lesson to be learned from both episodes, paradoxically, is not that we need less involvement with the free enterprise system, but more. I say "paradoxically" because in the minds of most people, particularly the journalists who have written about these two stories, the case seems very straightforward: at one time these facilities were both under the control of the government, and all was well. Then there came a time when each was privatized, whereupon difficulties broke out. The lesson seems obvious: re-provincialize both amenities, and while we are at it, nationalize pretty much everything else, because if the government is more efficient that the private sector, why should we have much of the latter in any case?
Does anyone see a difficulty here? What passes for "common sense" amongst the Canadian chattering classes has been tried elsewhere, and found wanting. Very wanting. Now, let’s see, where was that. Oh, yes, now I remember: it was the Soviet Union and its satellite countries, which all went belly up, economically speaking, late in the last century. And now we are seriously considering a "made in Canada policy" of nationalization that is a pale carbon copy emulation of the failure of communism? For shame!
But it is not enough to know that greater reliance on the public sector will fail; if we are to eradicate this sort of thinking we must know why as well. Otherwise, people will continue to think that what happened to the USSR was an accident, and that "it can’t happen here."
So why is it that markets typically outperform governments in providing services such as paper clips and corn and wrist watches and milk, and also water quality and life guarding at beaches? It is due to the profit motive and competition. If the pizza in my restaurant is lousy, you go elsewhere. If you do, I am given a strong market signal to mend the error of my ways, and if I cannot, to get into a line of work where I can make a contribution to society. Contrast this to Pizza Canada, based on the same economic principles that have long endeared us to Canada Post. Here, if you don’t like the food product, you can go elsewhere, but Pizza Canada keeps on going and going, just like the energizer bunny, courtesy of tax payments mulcted from consumers unwilling to give this operation their dollar votes.
For some reason, there is a fetish in Canada about water. Yes, other things may be safely left to the market, but not this fluid. Water is special. Nonsense on stilts! H2O is just another liquid. Free enterprise supplies us with high quality milk, soda pop, beer, wine, liquor, fruit juice, and every other liquid under the sun. Why should water be any different?
It might be objected that the quality of these other substances is controlled by the state apparatus; but the same could apply to water. In any case, which do you trust more: a government monopoly bureaucratic certification agency, or a competitive industry dedicated to these same ends? Realize that the same weeding out process that applies to pizza also encompasses quality assurance. Thalidomide for morning sickness, after all, was approved by a government agency that by its very nature could never go bankrupt. We ought to more greatly appreciate the profit and loss system that automatically encourages success and penalizes failure. The Soviets, lacking this feedback mechanism, fell victim to economic arteriosclerosis. We do not get good burgers from McDonalds, high quality pizza, pure beverages from Coca Cola, wonderful cars from Rolls Royce, because of government oversight, which is subject to bribes in any case. No, these things come to us, and also Kosher foods another private institution of quality control, from the market sector.
Yes, private enterprise is not perfect. There will be injuries and even deaths in areas under its control. A few people drown, and others drink impure water. More would suffer these fates under bureaucratic management. Consider the some 3,000 Canadian motorists and pedestrians who lose their lives each year in traffic accidents on roads owned and managed by various governmental jurisdictions (the number is roughly ten fold this in the U.S.). Why is there no hue and cry to privatize these properties? Could it be that due to the fact that under the veneer of appreciation for capitalism there is still a strong subterranean yearning for the Communist way of life?