Cartoon 754: Raiders

Corporate America is littered with eviscerated businesses. Investors in collusion with the board of directors and management have broken up working entities for immediate profit. They sell off the parts of the business that is doing well. Wall Street is ecstatic and it boasts the stock price. The investors then liquidate their holdings and walk away with a profit. The core business that is left is either terminal or on life support. A famous case is studied in the Harvard Business school and many others. It is what happened at Sunbeam. It was a graphic and naked example.

This corporate mentality invaded government in the last decade. The Administration was advocating “privatization” of many government functions. But privatization is really just transferring the revenue of the operation to investors, while transferring the costs to the service recipients. In larger enterprises, it is a fact the government does it better and cheaper for the recipients. Privatization does it better in terms of transferring wealth to select individuals [investors].

In American culture today the relative disadvantages of privatization is loss in the hubris. In this game of monopoly the rich keep getting richer.