HSTEd
Veteran Member
- Joined
- 14 Jul 2011
- Messages
- 20,359
If heavy handed regulation is necessary it probably shouldn't be in the private sector!There are certain parts of the private sector where reasonably heavy-handed regulation/supervision is needed and there is a legitimate debate as to whether certain industries would be better off in public ownership (someone mentioned water above). But in most areas, the private sector doesn't need that much supervision as customers, employees and, yes, shareholders will all be positive influences. They idea that "They don't care if the service works or not" is juvenile and implies a level of short-termism that simply doesn't reflect the reality.
The heavier the regulation has to be the higher the costs associated with the constant tug-of-war between business and the regulator gets.
As an example, the energy system has been run by the "free market" for the last 30+ years and it's turned into an utter disaster as a result of endless short termism. Shareholder value was maximised by running the system into the ground and abandoning any semblence of resilience and fuel hedging. Now all society will pay the penalty whilst the benefits accrued to a small portion through shareholder value. Ultimately the shareholders don't really care if some people freeze to death if their dividends and stock value growth is maintained.
[And that's before we consider trying to purchase generating plant with short term private loans which led inevitably to the current problem]
And throughout numerous short-term jobs in manufacturing and the like, I've seen rampant short termism.
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