The Perils of Privatization

Diane Ravitch's blog

Make no mistake: The purpose of privatization is to make a profit. The promise of privatization is efficiency. But in its pursuit of both profits and efficiency, privatization creates perverse incentives. It encourages privately managed charter schools to avoid or get rid of “expensive” students” (unless the reimbursement formula makes them profitable to keep); it encourages for-profit hospitals to over diagnose patients and perform unnecessary surgeries; it encourages private preschool providers of special education to misdiagnose children as in need of services to produce profits.

And it encourages private managers of prisons to keep the prison population as large as possible, since an empty cell is a cell that produces no revenue.

Here are some recent examples, drawn from the invaluable website “In the Public Interest,” which reports regularly on privatization of the public sector:

On the tenth anniversary of Operation Streamline, Free Speech Radio News reporter Shannon Young interviews…

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