Missouri Privatization Roundup
There has been a great deal happening on the issue of privatization throughout our state. Tony’s Kansas City has been reporting that Missouri-American is in talks with Kansas City officials involving the city’s water division. Here’s hoping this is true. This would be excellent for Kansas City in both the short and long run. Private companies do a perfectly fine job of providing gas and electricity to Kansas City, and water to many other parts of Missouri. Private utilities are heavily regulated in Missouri, and local mandates can be included in any agreement between KC and Missouri-American Water. (I am not saying local mandates should be included, just that they could be if local officials think they are necessary.)
In economic terms, public goods are non-rivalrous and non-excludable. Except in extreme circumstances, the water I consume does not limit your consumption of water. In this case, the water in the Missouri River is non-rivalrous. However, with utility services — as opposed to national defense or local roads — it is easy to prevent someone from using the asset if necessary. They are excludable. It is hard to argue that water access and infrastructure needs to be provided by the government, especially when there are private providers operating in the area that have a proven ability to provide the product. And it is even more difficult to make that argument when a lease, management contract, or utility sale would be valuable to taxpayers. (To those who might scream about everyone having the basic right to water, you are all free to collect rain water to drink, and to take baths in a local stream all you want. This is about the demand for pressurized hot or cold water coming into your home on demand by turning a tap.)
To its credit, Kansas City’s water division at least charges for its water like a private good instead of a public good. The fact that Saint Louis still lacks water meters for most of its consumers is absurd. Even if Kansas City changes the debate some by charging for water more like a private good, the fact is that public utilities far too often lack the political will to charge what they need to charge for the asset.
Also in Kansas City, the private contract to operate the animal shelter has been pulled. This happened awhile back, and I touched upon it here, but this is a great disappointment. This is clearly not a failure of privatization, unless saving money and increasing adoptions is a failure. It might be considered a failure of this particular private operator, but I remain unconvinced. I think that there is a core group of activists/volunteers who will never be happy with any system until they get a no-kill shelter in Kansas City. I say this as a dog-lover who got my dog (who passed away last year at 10) back in 2000 from a local shelter.
I think the city caved to accusations, as this statement indicates:
“We’ve been receiving allegations from some of the volunteers who put in time out at the shelter regarding mistreatment of animals,” said David Park, director of Neighborhood and Community Services for the city.
Park acknowledged the shelter has been run better now than in the past.
“They’ve done a wonderful job, as far as increasing the number of adoptions. (Previously) the number of animals that were euthanized was far greater than the number that was adopted, and now the opposite is true,” Park said.
According to Park, the city has to protect itself, even if the allegations have yet to [be] proved.
“Until we have the formal results of the investigation back, we don’t want to renew a contract for a year, for another year, and then have something surprising come out of the Missouri Veterinary Medical Board — then we need to cancel right away.”
The private airport in Branson is struggling financially. It does not appear to be struggling in its day-to-day operations, but I’ll try to fly there next week to make a better judgement. They have two commercial airlines offering regular flights to Houston, Atlanta, and Denver, and more charter services. It remains to be seen how the airport’s debt issues will play out over time. I certainly hope that this experiment succeeds, but who knows? If it does fail, it will fail with (mostly) private money. Compare that to Mid-American Airport over in Illinois, and pick which style you want.
