Do roads turn a direct profit? Water works? Canals? Flood Dams? Dikes? Are public parks profitable? Should schools be profitable? Is the police profitable? Does the fire department charge for every blaze they contain? Is the congress profitable? Are the courts? The president? The government as a whole?
Society funds a lot of public services because they cannot reasonably be billed to the individual, but enable the society to function and are the underpinning of economic activity. They are profitable because they allow society and the individuals to engage in economic activity which they otherwise could not.
We should strive to make public services efficient, but aiming for profit is against their very nature.
Libraries, the fire department, the police department, congress, the courts, and the government are a "cost center". Their services are not directly charged for and on our balance sheet they cost money, however in general the benefit they provide allows all the other beneficial things we want to do to happen and support our "profit centers" like industry. We should work to ensure the money invested is used effectively, but a "cost center" will _never_ turn a profit and asking it to produce one does not make sense.
And for those not following... yes, this is exactly like the IT or legal department in a typical company. At Joe's Widgets the IT department does not charge the customers any money and therefore is a pure cost. But without IT keeping the machinery and networks online, they don't produce many widgets. They pay for their IT department because _overall_ the outcome is better versus going back to manually stamping widgets without computers or automation because "IT costs money". We want to make sure IT isn't spending wastefully, but we can't simply say "IT needs to turn a profit or else we're going to shut them down" otherwise overall things end up less efficient and more expensive and we go out of business.
(As an aside, it's really wild to me how many people in IT can hold the position that "things that don't directly turn a profit shouldn't exist!" while half of our industry is in positions that don't directly turn a profit.)
A library will not profit from its members being able to read books for free, but society as a whole will profit.
Demanding each individual component of society be profitable leads to the overall detriment of the whole. It leads to hospitals only treating the rich and only for money, it leads to no-one producing art, it leads to homeless shelters not existing. It leads to society becoming an inhumane machine to produce and consume money, and nothing more.
Humans are more important than money, society is more important than money.
It should be an anti-goal. If it can be provided adequately at a profit (that is, if the benefits of purchasing the service to direct purchasers are sufficient to warrant direct users paying a sufficient price to not only offset the costs of providing a service but also to provide a profit to the service provider), then there is probably no reason to have a public service.
The reason to have a public service is primariy that it is desirable but not profitable, probably because of externalized benefits, or because the utility provided is concentrated in a financially disadvantaged population, such that the amount that they are able to pay underrates the utility delivered (the use of money as a proxy for delivered utility is only at best a loose proxy when money itself is unequally distributed), or for some other reason.
If it should be a public service at all, then it should almost without exception be publicly subsidized in whole or in part. Profitability in a public service is a "code smell" that you have something that likely should be a private industry that has instead been unnecessarily monopolized by the state.
Public parks don't turn profits. Public roads don't turn a profit. Food stamp programs and housing assistance don't generate a profit.
Public goods can increase efficiency and well-being in a way that indirectly translates into increased economic efficiency, but no, profit is not a good direct long term goal of most public goods and services.
Imagine what would happen if Uber never ran at a loss. It wouldn't have been able to grow into what it is now. Losing money in the short term can bring long term wins.
Think it is easier to just point at something like Defense. Without more active imperialism, I am not sure how the Army/Navy/Airforce is going to pay for all of that Freedom they protect.
I was shooting heroin and reading “The Fountainhead” in the front seat of my privately owned police cruiser when a call came in. I put a quarter in the radio to activate it. It was the chief.
“Bad news, detective. We got a situation.”
“What? Is the mayor trying to ban trans fats again?”
“Worse. Somebody just stole four hundred and forty-seven million dollars’ worth of bitcoins.”
The heroin needle practically fell out of my arm. “What kind of monster would do something like that? Bitcoins are the ultimate currency: virtual, anonymous, stateless. They represent true economic freedom, not subject to arbitrary manipulation by any government. Do we have any leads?”
“Not yet. But mark my words: we’re going to figure out who did this and we’re going to take them down … provided someone pays us a fair market rate to do so.”
“Easy, chief,” I said. “Any rate the market offers is, by definition, fair.”
He laughed. “That’s why you’re the best I got, Lisowski. Now you get out there and find those bitcoins.”
“Don’t worry,” I said. “I’m on it.”
I put a quarter in the siren. Ten minutes later, I was on the scene. It was a normal office building, strangled on all sides by public sidewalks. I hopped over them and went inside.
“Home Depot™ Presents the Police!®” I said, flashing my badge and my gun and a small picture of Ron Paul. “Nobody move unless you want to!” They didn’t.
“Now, which one of you punks is going to pay me to investigate this crime?” No one spoke up.
“Come on,” I said. “Don’t you all understand that the protection of private property is the foundation of all personal liberty?”
It didn’t seem like they did.
“Seriously, guys. Without a strong economic motivator, I’m just going to stand here and not solve this case. Cash is fine, but I prefer being paid in gold bullion or autographed Penn Jillette posters.”
Nothing. These people were stonewalling me. It almost seemed like they didn’t care that a fortune in computer money invented to buy drugs was missing.
I figured I could wait them out. I lit several cigarettes indoors. A pregnant lady coughed, and I told her that secondhand smoke is a myth. Just then, a man in glasses made a break for it.
“Subway™ Eat Fresh and Freeze, Scumbag!®” I yelled.
Too late. He was already out the front door. I went after him.
“Stop right there!” I yelled as I ran. He was faster than me because I always try to avoid stepping on public sidewalks. Our country needs a private-sidewalk voucher system, but, thanks to the incestuous interplay between our corrupt federal government and the public-sidewalk lobby, it will never happen.
I was losing him. “Listen, I’ll pay you to stop!” I yelled. “What would you consider an appropriate price point for stopping? I’ll offer you a thirteenth of an ounce of gold and a gently worn ‘Bob Barr ‘08’ extra-large long-sleeved men’s T-shirt!”
He turned. In his hand was a revolver that the Constitution said he had every right to own. He fired at me and missed. I pulled my own gun, put a quarter in it, and fired back. The bullet lodged in a U.S.P.S. mailbox less than a foot from his head. I shot the mailbox again, on purpose.
“All right, all right!” the man yelled, throwing down his weapon. “I give up, cop! I confess: I took the bitcoins.”
“Why’d you do it?” I asked, as I slapped a pair of Oikos™ Greek Yogurt Presents Handcuffs® on the guy.
“Because I was afraid.”
“Afraid?”
“Afraid of an economic future free from the pernicious meddling of central bankers,” he said. “I’m a central banker.”
I wanted to coldcock the guy. Years ago, a central banker killed my partner. Instead, I shook my head.
“Let this be a message to all your central-banker friends out on the street,” I said. “No matter how many bitcoins you steal, you’ll never take away the dream of an open society based on the principles of personal and economic freedom.”
He nodded, because he knew I was right. Then he swiped his credit card to pay me for arresting him.
It should be a long term goal. At the very least the perspective of how it is being run needs to be thought of in terms of profit.
Do roads turn a direct profit? Water works? Canals? Flood Dams? Dikes? Are public parks profitable? Should schools be profitable? Is the police profitable? Does the fire department charge for every blaze they contain? Is the congress profitable? Are the courts? The president? The government as a whole?
Society funds a lot of public services because they cannot reasonably be billed to the individual, but enable the society to function and are the underpinning of economic activity. They are profitable because they allow society and the individuals to engage in economic activity which they otherwise could not.
We should strive to make public services efficient, but aiming for profit is against their very nature.
Or put another way:
Libraries, the fire department, the police department, congress, the courts, and the government are a "cost center". Their services are not directly charged for and on our balance sheet they cost money, however in general the benefit they provide allows all the other beneficial things we want to do to happen and support our "profit centers" like industry. We should work to ensure the money invested is used effectively, but a "cost center" will _never_ turn a profit and asking it to produce one does not make sense.
And for those not following... yes, this is exactly like the IT or legal department in a typical company. At Joe's Widgets the IT department does not charge the customers any money and therefore is a pure cost. But without IT keeping the machinery and networks online, they don't produce many widgets. They pay for their IT department because _overall_ the outcome is better versus going back to manually stamping widgets without computers or automation because "IT costs money". We want to make sure IT isn't spending wastefully, but we can't simply say "IT needs to turn a profit or else we're going to shut them down" otherwise overall things end up less efficient and more expensive and we go out of business.
(As an aside, it's really wild to me how many people in IT can hold the position that "things that don't directly turn a profit shouldn't exist!" while half of our industry is in positions that don't directly turn a profit.)
> The president?
The incumbent has certainly found many creative ways to make it extremely profitable for himself.
A library will not profit from its members being able to read books for free, but society as a whole will profit.
Demanding each individual component of society be profitable leads to the overall detriment of the whole. It leads to hospitals only treating the rich and only for money, it leads to no-one producing art, it leads to homeless shelters not existing. It leads to society becoming an inhumane machine to produce and consume money, and nothing more.
Humans are more important than money, society is more important than money.
It should be an anti-goal. If it can be provided adequately at a profit (that is, if the benefits of purchasing the service to direct purchasers are sufficient to warrant direct users paying a sufficient price to not only offset the costs of providing a service but also to provide a profit to the service provider), then there is probably no reason to have a public service.
The reason to have a public service is primariy that it is desirable but not profitable, probably because of externalized benefits, or because the utility provided is concentrated in a financially disadvantaged population, such that the amount that they are able to pay underrates the utility delivered (the use of money as a proxy for delivered utility is only at best a loose proxy when money itself is unequally distributed), or for some other reason.
If it should be a public service at all, then it should almost without exception be publicly subsidized in whole or in part. Profitability in a public service is a "code smell" that you have something that likely should be a private industry that has instead been unnecessarily monopolized by the state.
Public parks don't turn profits. Public roads don't turn a profit. Food stamp programs and housing assistance don't generate a profit.
Public goods can increase efficiency and well-being in a way that indirectly translates into increased economic efficiency, but no, profit is not a good direct long term goal of most public goods and services.
>Public parks don't turn profits.
If people don't care enough about a park to fund it, then that space may be of better use to something else.
>Public roads don't turn a profit.
They are a loss leader aimed to make more money elsewhere.
>Food stamp programs and housing assistance don't generate a profit.
If people don't want to fund such things people in those programs should make or buy their own food and housing.
>that indirectly translates into increased economic efficiency
Again the idea of things like loss leaders are not foriegn to entities that want to be profitable.
7 replies →
If I hire a plumber, I hire them to fix my pipes. I don't hire them to generate a profit for me.
If me and my neighbors hire a library to lend us books, I don't expect them to generate a profit for me.
The beneficiary is the citizen receiving the service, not the government receiving a profit.
The idea of government profiting is like trying to make a profit from yourself.
>I don't hire them to generate a profit for me.
But the plumber will aim to make a profit. If the plumber charges $5 for jobs that cost $50 that person won't be able to sustain being a plumber.
>The beneficiary is the citizen receiving the service
And citizens want to get the best bang for their buck of tax money. Receiving more and better services is what people want.
>The idea of government profiting is like trying to make a profit from yourself.
The government isn't making a profit from itself. It's making it from its people and companies / organizations.
Public services serve the public good. Turning a profit for the government is proof of its inefficiency
How far does this go? Should all public space be pay to use or privatised?
> It should be a long term goal
Why?
Imagine what would happen if Uber never ran at a loss. It wouldn't have been able to grow into what it is now. Losing money in the short term can bring long term wins.
3 replies →
Did the food you eat today turn you a profit?
I made more money from the energy the food gave me than what the food cost. I made a profit.
1 reply →
You are everything that's wrong with the world right now.
You realize that’s impossible with certain public goods eg USPS? We can either have mail delivery to everyone in the country or we can make profit.
Think it is easier to just point at something like Defense. Without more active imperialism, I am not sure how the Army/Navy/Airforce is going to pay for all of that Freedom they protect.
You can still aim to make as much profit with the constraint that you must deliver to everyone.
I was shooting heroin and reading “The Fountainhead” in the front seat of my privately owned police cruiser when a call came in. I put a quarter in the radio to activate it. It was the chief.
“Bad news, detective. We got a situation.”
“What? Is the mayor trying to ban trans fats again?”
“Worse. Somebody just stole four hundred and forty-seven million dollars’ worth of bitcoins.”
The heroin needle practically fell out of my arm. “What kind of monster would do something like that? Bitcoins are the ultimate currency: virtual, anonymous, stateless. They represent true economic freedom, not subject to arbitrary manipulation by any government. Do we have any leads?”
“Not yet. But mark my words: we’re going to figure out who did this and we’re going to take them down … provided someone pays us a fair market rate to do so.”
“Easy, chief,” I said. “Any rate the market offers is, by definition, fair.”
He laughed. “That’s why you’re the best I got, Lisowski. Now you get out there and find those bitcoins.”
“Don’t worry,” I said. “I’m on it.”
I put a quarter in the siren. Ten minutes later, I was on the scene. It was a normal office building, strangled on all sides by public sidewalks. I hopped over them and went inside.
“Home Depot™ Presents the Police!®” I said, flashing my badge and my gun and a small picture of Ron Paul. “Nobody move unless you want to!” They didn’t.
“Now, which one of you punks is going to pay me to investigate this crime?” No one spoke up.
“Come on,” I said. “Don’t you all understand that the protection of private property is the foundation of all personal liberty?”
It didn’t seem like they did.
“Seriously, guys. Without a strong economic motivator, I’m just going to stand here and not solve this case. Cash is fine, but I prefer being paid in gold bullion or autographed Penn Jillette posters.”
Nothing. These people were stonewalling me. It almost seemed like they didn’t care that a fortune in computer money invented to buy drugs was missing.
I figured I could wait them out. I lit several cigarettes indoors. A pregnant lady coughed, and I told her that secondhand smoke is a myth. Just then, a man in glasses made a break for it.
“Subway™ Eat Fresh and Freeze, Scumbag!®” I yelled.
Too late. He was already out the front door. I went after him.
“Stop right there!” I yelled as I ran. He was faster than me because I always try to avoid stepping on public sidewalks. Our country needs a private-sidewalk voucher system, but, thanks to the incestuous interplay between our corrupt federal government and the public-sidewalk lobby, it will never happen.
I was losing him. “Listen, I’ll pay you to stop!” I yelled. “What would you consider an appropriate price point for stopping? I’ll offer you a thirteenth of an ounce of gold and a gently worn ‘Bob Barr ‘08’ extra-large long-sleeved men’s T-shirt!”
He turned. In his hand was a revolver that the Constitution said he had every right to own. He fired at me and missed. I pulled my own gun, put a quarter in it, and fired back. The bullet lodged in a U.S.P.S. mailbox less than a foot from his head. I shot the mailbox again, on purpose.
“All right, all right!” the man yelled, throwing down his weapon. “I give up, cop! I confess: I took the bitcoins.”
“Why’d you do it?” I asked, as I slapped a pair of Oikos™ Greek Yogurt Presents Handcuffs® on the guy.
“Because I was afraid.”
“Afraid?”
“Afraid of an economic future free from the pernicious meddling of central bankers,” he said. “I’m a central banker.”
I wanted to coldcock the guy. Years ago, a central banker killed my partner. Instead, I shook my head.
“Let this be a message to all your central-banker friends out on the street,” I said. “No matter how many bitcoins you steal, you’ll never take away the dream of an open society based on the principles of personal and economic freedom.”
He nodded, because he knew I was right. Then he swiped his credit card to pay me for arresting him.
What in the this-was-written-for-Leslie-Nielsen-s-ageless-noir-delivery...