Government for Sale
It was Christmas of 1991. Mikhail Gorbachev, the Communist Party Secretary and leader of the Soviet Union, failed. In his four years of power, the economic and political reforms he introduced to save the Soviet Union, desperate changes to “Communism,” foundered. The economy didn’t recover, the disparity of wealth between the party apparatchiks and the rest of the people was too great. The “member states” of the Union had broken away. Gorbachev had decided to “…tear down this wall” in East Germany, and the readymade markets of Eastern Europe were gone.
Hard line members of the Communist Party revolted against the reforms in August, but were faced down by Boris Yeltsin (standing on a tank) and the people. The Communist Revolution of 1917 was over: Gorbachev resigned on Christmas Day, and on New Year’s Eve, 1991, the Soviet Union was dissolved.
The Soviet Union was a Communist based economy. That meant that the means of production, the factories and the stores; were all owned by the government. So were the collective farms, the fields and machinery. With the end of the government, all of this went up for sale; up for grabs to the highest bidder.
Much like the US South after the Civil War, those with some money, both insiders and “carpetbaggers,” were able to “buy low” in the fire sale of a buyer’s market. Billons of rubles were made and lost; and a whole new class of wealthy “apparatchiks” were created. They were not Communists; their path to government power was based on their money, legal or illegal. Russia went from a Communist state to a “kelptocracy,” a nation based on theft, the theft of the fortune that was the Soviet Union. The Russian people were still left with the money at the top, and the vast majority left to struggle.
Those billions of rubles moved throughout the world economy, impacting most aspects of finance. The world center for financial markets is located in New York City, so it was no surprise that Russian rubles began to exert influence on American business and politics.
There has long been a strain of American conservatism that believes that whatever needs to be done, private industry can do it better. There is an old cartoon from the early 1960’s that shows Senator Barry Goldwater, the father of modern conservatism, with an aide whispering in his ear “…Senator, the post office has always been owned by the Government.” It was a joke, the Post Office is an original Constitutional authority of the government. It’s not a joke anymore.
The Trump Administration issued its proposal for Government reorganization last week, under the fog of the immigration scandal. The big items: merging the Departments of Education and Labor into one, “…to address the educational skills and needs of American students and workers in a coordinated way…” and moving all of the nutritional aid programs from the Department of Agriculture into a renamed Department of Human Services (to become the Department of Health and Public Welfare.)
But it’s in the privatization of long government-administered programs where the money can be made. The air traffic control functions of the FAA, and the Postal Service are two services on now to go on the block. This is in addition to the private contracting of such services as the housing of interned migrants. The $10 million contract for the “tent city” camp erected in the Texas desert southeast of El Paso, was let to General Dynamics, a company best known for building defense systems.
And now the Trump Administration is looking to build what can only be called internments camps for many thousands of immigrants on military bases throughout the country. Those camps will be paid for by the Defense Department, but the actual building won’t be by the Army Corps of Engineers or the Seabees. These are high priced contracts, going out to private companies.
It has been the “mantra” of conservatism that private industry can do it better. We in Ohio have seen the folly in that plan, at least in the traditional government function of education, with the colossal failure of ECOT, the Electronic Classroom of Tomorrow, a private computer based school that received an enormous amount of state funding. ECOT ultimately enrolled thousands of students who didn’t “attend,” and received millions of dollars for them. While it is now being sorted out in the courts, at least $60 million in state educational funding was misused.
So while the privatization of government may seem like a good “capitalist” plan, we should look carefully at the available examples. The “fire sale” of the Soviet Union, that brought us the kleptocrats of Russia, made the rich richer, and left the people even farther behind. And we know that Russia seems to be admired by the far-right minds that provide the Trump ideology. And we also know there’s lots of money to be made by “selling” the government.
Doesn’t that sound like ideas designed to appeal to President Trump?
