Transit privatization

The TransportPolitic asks an extremely good question:

If transit isn’t better operated by the private sector, why is it still being privatized?

This essay is a fairly standard description of neoliberalism’s effects on transit policy. I think, however, that the political economy has actually morphed and we have to be thinking a bit differently now. We need a clever political theorist to coin a new term, something better than post-neoliberalism, which is what I think we are experiencing, with Obama and the worldwide recession and the bailouts, etc. Certainly lots of transit companies have gone racing forward for ARRA money, sans private partners.

This is primarily quibbling, however, and the larger point holds: politicians like privatization primarily out of ideology and the desire to demonstrate they have done something–a bit like charging around looking to eliminate political science funding—not because we ever really save real money. What has never been clear to me about privatization is whether it’s not all that cost effective because services like transit, with their comparatively high barriers to entry for anything past jitneys, just do not favor private, for-profit operations versus how much efficiency we just plain lose because we over-regulate and poorly negotiate private contracts. There’s a great deal of politics that run both ways between the right and the left; not all PPPs have been great, and not all have been ineffective. But almost all in transit have.

One of my favorite books on the subject is Elliott Schlar’s You Don’t Always Get What You Pay For. Hiro Iseki at the University of New Orleans has done some interesting work in the topic, as has Tony Gomez Ibanez at Harvard.