Tuesday, October 20, 2009

Knee-Jerk Reactions to Privatizations

Leo Zuckermann was depressed by the swiftness with which Calderón shot down any talk of a privatization of LyFC:
In countries where the privatization was accompanied by greater competition (or better regulation in the case of natural monopolies) it continues being used as a public policy to benefit society. Not only in governments of the right, but also of the left. There is, for example, the case of the Labor Party in Great Britain. Gordon Brown is thinking about privatizing various state activities to cut the public debt of the nation. The prime minister will put up for sale the railroad network of the English Channel, several highways, a gambling house, a uranium-enrichment company and government land.

This would be unthinkable in Mexico. Here privatization is an evil verb that can't even be mentioned. The most pathetic case is oil, where, for the sake of not opening the industry to private investment, Mexico is running out of oil. We didn't allow private oil platforms even though these could extract a lot of oil and the state could charge a right of exploitation as high as the one leveled at Pemex today. We don't want capitalists that make money and produce oil. We prefer the exclusivity of the state although oil production is plummeting.

What can you say: in Mexico privatization has turned into a myth as diabolical as that of the chupacabras.
Good point. Thanks Salinas!

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