From Public Assets to Private Empires: The Global Consequences of Privatisation

The global consequences of privatisation have proven detrimental to societies worldwide. This ideology, that government is the problem and private sector the solution, has been perpetuated for four decades. However, overwhelming evidence suggests otherwise. The International Monetary Fund acknowledges the theory's ambiguity, while the World Bank states that privatization alone does not guarantee improved performance.

Meta-studies reveal no significant difference in efficiency between public and privately owned companies in public services.

England's water privatization in 1989 exemplifies these issues. Rather than improving efficiency or investment, water prices doubled, shareholders extracted £95 billion, and debt accumulated to finance dividends. Consequently, sewage spills tripled, reaching 3.6 million hours in 2023. Water companies morphed into financial extraction machines, burdening the public with environmental pollution.

This model extends beyond developing countries, as evidenced by European societies grappling with inequality, declining living standards, unaffordable housing, rising energy costs, and deteriorating public services. Growing public discontent has prompted thousands to protest the growing difficulty of making ends meet. Young people, workers, teachers, trade unions, and housing activists share this frustration with an economic system that seems to benefit a privileged few while leaving the majority struggling.

The impacts of this ideology are also evident in the Global South, where it has been imposed most aggressively. Nigeria serves as a prime example. Privatization of state-owned cement assets in the early 2000s created a handful of wealthy individuals, while making cement unaffordable for the general population. This resulted in a housing crisis, with only government officials and oligarchs able to afford shelter.

The scale of this issue is staggering: the Economic and Financial Crimes Commission seized 800 houses from a single former Central Bank governor, while millions of Nigerians cannot afford a bag of cement. More than 112 million Nigerians live in poverty, while a few oligarchs – created through the state's transfer of public assets – amass extraordinary wealth.

Can this system function in a democratic setting, where new administrations inevitably distribute wealth among cronies? The system's logic suggests otherwise, creating a rotating spoils system where public wealth becomes the prize, and citizens are mere spectators.