A Meditation on Public/Private Partnerships

ILSR.org, accessed 1/27/2018

While I was doing my first Master's at the University of Kentucky in Public Administration, I had the opportunity to work with the Kentucky Transportation Center as a Research Intern.  The Kentucky Transportation Center is essentially the research wing of the Kentucky Transportation Cabinet, which is Kentucky's main policy-making body for issues related to transportation and infrastructure in the Commonwealth of Kentucky.  One of the projects I had a hand on was creating the literature review for a study on public-private partnership policies in other states.  Since that time, I have had several other experiences related to witnessing how government and private enterprises interact with each other, and some thoughts on how they can interact with each other to produce more desirable outcomes in the social pool.

It should be noted that this goal of producing more desirable outcomes within the society is the selfish interest of the public sector.  Contrary to common Libertarian or Right-wing  logic, governments can and do fail on major levels (as the French Ancien Regime, or the Romanov Dynasty, or the Iranian Shahs can demonstrate) or on minor levels (when one electoral faction gets voted out of office and replaced by another electoral faction within the confines of one institutional framework).  From my own observations of history, and some insights from people like Dr. Peter Turchin at the University of Connecticut, Acemoglu and Robinson, and Elinor Ostrom, it seems to me that if a government or government faction is trying to survive within the social group they are a part, they would be pro-social, and self-interested in helping all others within their social group.  This stems from the hypothesis that more desired factions or governments are either less expensive to operate, and able to last longer in government as a government than those who are not honestly desired.  That is, societies reject governments that are seen as being undesirable and ineffective more readily than those who are seen as being desirable and effective.  Furthermore, this is dependent on the substantial effects that are experienced within the social group AND the perceptions of people.  When people are not able to get what they want from society, and are unable to heal the social group because of the machinations of the problematic group(s) in society, then they simply get angrier and more inclined to violence against those whom/that which they see as being at the core of their poor experiences in life.  This may or may not be accurate.  But unless the wounds are actually and effectively healed, the anger will only get deeper, more pronounced, and violent in nature.  If you can understand these concepts, then I can begin with the post about public-private partnerships, and what the public sector can do to achieve its goals without inhibiting or preventing the private sector from successfully and effectively delivering the services for society's benefit.

At the core of a successful public-private partnership is the government's willingness, commitment, and desire to improve peoples' lives in society.  When that logic is taken for their own self-interest, they can then begin negotiations with the private sector that can lead to an outcome where the public sector gets the intended services and goods effectively provided at more efficient rates through the commercial logic of the private sector.  Above all the other concerns is for the government to leverage penalties for private companies who do not actually deliver the desired services as the society needs at an effective cost to the taxpayer, and to define outcome standards that must legally be accomplished by the private sector within a certain negotiated framework with some well-defined procedures and standards for figuring out wiggle-room.  This means that the government needs to assert themselves, and feel comfortable at asserting themselves in the interests of ensuring good outcomes for the society which, as discussed earlier, is the selfish interest of the public sector.  If the private sector is unwilling or unable to effectively and efficiently provide the needed services, the government should not pursue a for-profit public-private partnership, and should instead look at the option of a non-profit public-private partnership, or an in house public sector program that is directly designed, funded, and operated by the government itself.  The keys here are accountability, defined flexibility, forward-thinking and outcome-driven design, and the re-assertion of government as a superior partner with the private sector.  Again, the interests of the government are tied with the public at large, and the outcomes they experience in the world.  They are not with enriching the shareholder values and profit margins of for-profit companies and a minority few at the expense of the public at large.