The case against privatization

privatizationBy Darshan Maharaja

Recently, some employees of the Service Ontario centre located near Hurontario & Eglinton in Mississauga went on strike. Initially when this centre was run by the government, workers were paid $ 20 per hour, plus benefits and eligibility for pension. Then, a decision was made to privatize this institution, ostensibly as part of an effort to curb rising government expense and debt. The company that bought this centre slashed the employees’ pay down to minimum wage (currently $ 11.25 per hour), and also did away with the benefits. In other words, these workers’ earnings went down by half, perhaps more than half. Consequently, these employees formed a union and went on strike. The company brought substitute workers and kept the centre functional.

Coming from a government that blew $ 1 billion of taxpayers’ money just to preserve two seats in the provincial parliament talk about controlling expenditure is laughable, but the real question is, where were the other two political parties at the time Service Ontario was privatized? The answer to this question takes us to the heart of the issue.

The Conservative party has traditionally been a friend of the business world, and even admits this with pride. Let us recall that the privatization of Highway 407 in 1999 happened during the tenure of a Conservative government. An MPP of that very party, Mr. Douglas Rollins found that the government had, until then, spent a total of $104 billion on that highway. As against that, the government sold the highway to private investors for a paltry sum of $ 3 billion. Perhaps the better verb in this context is ‘gifted’ rather than ‘sold’. It is one thing for a government to be business-friendly (sometimes this can be to the society’s benefit also), but distributing public property to the connected or influential class is something else altogether.

Still, if the Conservative party was not opposed to the privatization of Service Ontario, that is understandable, as that would be consistent with their ideology that as much of economic activity should be in private hands as possible. That, however, is not the case with NDP. That party espouses a leftist or labour-dominated ideology (or at least claims to). Why didn’t that party oppose the privatization in the provincial parliament? The short (and distasteful) answer is – cold calculation about the future of politicians’ careers. The Liberal government had presented privatization of Service Ontario as part of the budget. Because the government was a minority one, it was essential to get the support of opposition parties in order to have the budget passed. As per rules, if a bill as important as the budget does not pass in the parliament, that is tantamount to a no-confidence vote having been passed – in other words, a fresh election. Opinion polls at the time indicated that, if an election were to be held, the NDP would not fare well at the hustings. In order to avoid a possible trouncing of her party in the election, the party chief, Ms. Andrea Horwath decided to support the budget in the parliament. Meaning, to secure her own (and her party’s) interest, the self-proclaimed protectors of workers’ rights sacrificed those very rights of workers.
But this was some 4 years ago. Talking about the present, a similar sequence of events is taking place with respect to the privatization of Hydro One. Having categorically denied any plans to privatize Hydro One only months earlier, Ms. Kathleen Wynne decided to sell 60 percent shares of that company. Hydro One made 750 million dollars in profits in the year 2014, yet the government’s decision to offer 60 percent of ownership of that company for a fire-sale price of some 9 billion dollars has not been opposed by the opposition parties in any meaningful manner. Ms. Wynne characteristically spins the issue by saying that this decision will broaden the ownership of Hydro One. The fact is that as the company was earlier a publicly owned property, each and every resident of Ontario had ownership interest in it. That will now be limited to those who choose to buy shares in it.

The more important issue here is of accountability. The right that the people of Ontario had to approach the government-appointed ombudsman (when the company was still publicly owned) has been lost. The names of the company’s employees earning over $100,000 a year have been removed from the ‘Sunshine List’. So called ‘experts’ (whether government-sponsored or sycophants) make patently wrong-headed statements that privatization of Hydro One opens the possibility of reduction of rates in the future. When the company’s internal goings-on can be kept secret legally, how can we believe that it will keep the consumers’ welfare in mind – and that too, a company that enjoys a monopoly, and hence is free from competitive pressures?

In this context, the plunder of public assets carried out by the leaders of Russia and other constituent republics, and the resultant plight of a very large part of the population, after the collapse of the Soviet Union comes to mind. It isn’t so old a chapter of history that its lessons cannot be considered as guidelines in the present case.

That lesson is that in evolution of countries, a stage comes when the benefits and priorities of the ruling classes are directly athwart the interests of the public at large. If the leaders who had lived under communism all their lives were seen exploiting their people to such an extent as to cause mass starvation, then what can we expect from the leaders of a capitalistic society? This not at all a case of making a mountain out of a molehill. If there is any difference between a collapsed Soviet Union and present-day Ontario, it is that our crisis will arrive in slow motion. Meaning, the interests of our future generations are at risk.

We have to accept the bitter truth that although the various political parties are formally aligned with different ideologies, in the end they are all but branches of one, larger party – and the name of that party is ‘the exploiter class’. The only way to escape the adverse consequences of their misdeeds is – constant vigilance, and fight for our rights and interests. Failing that – as a last option – a revolution.

Do we have time for all that? First let us watch Salman Khan’s film ‘Sultan’, and then we will maybe have time to think about this.

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