The daily drucker: february 19 - reprivatisation


The strongest argument for private enterprise is the function of loss.

Re-privatization is a systematic policy of using the other, non-governmental institutions of the society of organizations for the actual "doing," that is, the performance, operation, execution of tasks that flowed to government because the original private institution of society, the family, could not discharge them.  What makes business especially appropriate for re-privatization is that, of all social institutions, it is predominantly an organ of innovation.  All other institutions were originally created to prevent, or at least slow down, change.  They become innovators only by necessity and most reluctantly.

Business has two advantages where government has a major weakness.  Business can abandon an activity.  Indeed, it is forced to do so if it operates in a market.  What's more: of all institutions, business is the only one society will let disappear.  The second strength of business: alone among all institutions, it has the test of performance.  The consumer always asks: "And what will the product do for me tomorrow?"  If the answer is "nothing," he will see its manufacturer disappear without the slightest regret.  And so will the investor.  The strongest argument for "private enterprise" is not the function of profit.  The strongest argument is the function of loss.  Because a business is the most adaptable and the most flexible of the institutions around.

ACTION POINT: First prisons, now wars are being manned by private companies.  Make a list of which sectors will privatize next and determine how you can benefit.

Quoted from The Daily Drucker, page 55


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