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Security vs privatisation dogma

Print edition : Nov 10, 2001

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Lax airport security in the private sector in the U.S. and the fiasco of privatising railways in the U.K. provide costly lessons even as, in the aftermath of September 11, there is a creeping realisation that the public services may have their virtues.

A SIDELIGHT of the aftermath of September 11 is the creeping realisation among many Americans that a bigger role for government and the public sector is not such a bad thing after all. More soberly, there is a growing recognition that their very security depends upon more effective government-run public services. The widespread and genuine public appreciation of the New York Fire Department firefighters, scores of whom lost their lives at the World Trade Centre (WTC), reflects this new awareness. However, the Bush Administration and right-wing circles are resisting any move to expand federal, that is, government, role.

While the September 11 attacks focussed worldwide attention on the threat of terrorism, along with this questions are being asked in the United States about the efficacy of privatising public services. Thus far, the dominant mantra has been that the market would solve all problems.

The ease with which 19 hijackers boarded four commercial passenger planes from three airports has exposed the lax security system in American airports. In the post-mortem after the September 11 carnage, the reasons for the shocking lack of security have become evident. The entire security set-up in American airports is in the private sector. The Federal Aviation Authority (FAA), which is the government agency with jurisdiction over airports, only lays down the regulations for security. Unlike airport security in most European countries and India, which is in the hands of government security agencies, in the U.S. security functions at airports are contracted out to private companies. Overall airport security is given out to private companies and passenger and baggage checks are looked after by individual airlines, which in turn contract out this work to private companies. Four private companies dominate the screening of baggage in U.S. airports.

The fetish for privatisation has led to sacrificing security. The private companies win contracts by bidding. The contract goes to the lowest bidder who then proceeds to cut costs to the minimum while maximising profits. In the U.S., a baggage handler who examines passenger baggage is paid on an average $6 to $7 an hour by the private companies while in Europe the worker is paid $15 an hour plus benefits. The personnel hired to conduct the security operations are poorly paid and usually with no skills or interest in the job. Most European countries have airport security handled by government agencies.

Two U.S. presidential commissions and many reports of supervisory bodies have drawn attention to the defects in airport security. They recommended federalisation of airport security, which means that a federal government agency should directly handle security with its own personnel. These repeated recommendations were rejected as the dominant philosophy in the government and Congress was to cut back on government services and push for privatisation. More federal personnel and expenditure is condemned as "big government" and harmful for private enterprise.

So the situation was allowed to continue despite the fact that the FAA filed cases of numerous violations of security by private airlines. Last year the FAA decided to fine American Airlines $99,000 for lax security. Two American Airlines planes were hijacked on September 11. One of the private screening companies, Argenbright Security Inc., which has contracts in many large airports, was found to have hired screeners with criminal records, made false statements to the FAA, and failed to implement court orders to comply with federal regulations, according to the U.S. attorney in Philadelphia. This was reported in The Washington Post recently.

After September 11, the glaring defects in airport security under private agencies could not be overlooked anymore. Demands arose to hand over security arrangements to the Federal Authority. President Bush, the ardent champion of free markets and the private sector, was forced to promise new laws to strengthen airport security. The U.S. Senate unanimously adopted an Airport Security Bill that would create a new force of federal employees to screen baggage, place armed federal guards at key checkpoints and increase the number of air marshals on commercial planes. Some 28,000 new federal government employees would have had to be recruited if this Bill became law. The Republicans in the House of Representatives were unhappy. They wanted the employees to be in the private sector, under federal supervision. The Bush Administration shared their view. A private workforce would not have union or civil service protection, which would prevent them from being fired from their jobs. The Democrats wanted all the security and baggage screeners to be federal employees, which means they can unionise.

The Democrat-backed bill, which was identical to the one the Senate passed 100-0, would have meant hiring the security screeners as federal employees. The bill was defeated narrowly by 218 to 214 votes in the House of Representatives on November 1. In its place, a Republican measure which calls only for federal supervision of private security screening companies was passed. The Administration will have the choice to hire private security companies or federal employees. President Bush will now approve a bill that will mark a retreat from the one the Senate adopted. It will probably end up having the federal government oversee airport security without making the personnel federal employees.

Creating 28,000 new federal jobs at a time when hundreds of thousands of jobs are being axed in the private sector would have been a small but significant blow at market orthodoxy and the privatisation freaks. But the Republicans, who are more avowedly in league with big business and airline industry interests, would have none of this.

In a society which has made the market the god and which has been bombarded with the message that more government means socialism, we have seen the spectacle of genuine public appreciation for the New York Fire Service, which lost scores of firemen in the collapse of the WTC towers when they rushed in to rescue people. The importance of public services run by the government agencies at various levels has been etched into the consciousness of the American people in a way that is contradictory to the dogma of market forces and privatisation. As a prominent American economist, Paul Krugman, points out in a piece in The New York Times (October 11), if the fire services had been privatised, each contract would have led to fire-fighting only for individual buildings while the fire would have spread all over. He concludes by commenting on the airport security dispute: "The Right's fanatical distrust of government is the central fact of American politics, even in a time of terror." So the people should be put at risk to see that federal functions and expenditure do not expand.

WHILE in the bastion of free market orthodoxy the importance of public services came to the forefront, a connected event took place in Britain. Since the 1980s, with Margaret Thatcher providing the lead, public services have been put up for sale one after another. British Rail, which was the government-owned railway enterprise, was sold off and broken up. Railtrack, a private company, owned and maintained railway stations and tracks. The actual running of trains on various routes was parcelled out to different private companies. As a result, the quality of railway services has sharply deteriorated over the past few years. Two major railway accidents took place in 1999 and 2000 because of the lack of proper maintenance and cost-cutting in equipment. By the year 2000, the crisis came to a head with incessant delays in train schedules, a lack of coordination between Railtrack and the other private companies, and squabbles over who should spend money for upgrading railway track and equipment.

Finally, on October 7, coincidentally the day "Enduring Freedom" was launched, Railtrack was placed under an administrator by the government. It had accumulated 3.3 billion in debt. The Tony Blair government clings on to the privatisation dogma and refuses to accept the need to deprivatise the railways and place it under public ownership and control. The logical result should be the ending of private ownership of railways and providing for a single and unified public sector railway authority. But Blair, a vehement opponent of renationalisation, claims that it is too expensive and "not in the interests of the travelling public". The Labour government now seeks to begin the privatisation of the London underground railway system. This is against the wishes of the popular Mayor of London and public opinion in the city.

In both these cases - lax airport security under the private sector in the United States and the fiasco of privatising railways in Britain - reality came up against dogma. Although these cases do not signify a turnaround against market dogma, they mark a small step in the long struggle ahead to roll back these pernicious ideas.

HOWEVER, these events should encourage the Left in India to continue its struggle against the reactionary policies of imposing market ideology and privatisation. In recent years we have been seeing in India the denigration of public services and moves to privatise them. Two important public services built up in the British days that have made a big contribution to independent India are the railways and the postal services. The Bharatiya Janata Party-led government would dearly love to privatise the railways in line with the recommendations of the Rakesh Mohan Committee. Two railway lines in Assam in the northeastern India are being closed down by the railways. The Nagaon-Silghat and Hoiborgaon-Moirabari lines built by the British in 1930 are to be dismantled owing to "low returns". It is this outlook that left Tripura with just 45 km of railway line since Independence. Communications in the northeastern India are hostage to the profit motive. The declining investment in railway track maintenance and equipment upgradation has led to an appalling safety record and numerous accidents in the last few years.

Likewise, the postal system run by the government is being downgraded. Personnel levels are being reduced and services allowed to deteriorate in order to buttress the argument that in postal services the private sector will be more efficient. It will be a tragedy if these public services, which play an important social and economic role in the country, are allowed to go downhill so that private interests can carve up these durable systems built up over decades and to profiteer by cutting back on socially necessary functions while providing quality services only for the affluent and business sections.

To the likes of Arun Shourie who advocate reckless privatisation in India, it must be pointed out that the security system in Indian airports is far more comprehensive and effective than what was in place in American airports. The reason for this is that airports are under the jurisdiction of a government agency and security screening is handled by police personnel. Although they are low-paid, they are still better off than the privately contracted American baggage screeners. All said and done, police or government personnel are more accountable for matters concerning security. In this context, the Central government must now answer the question whether it still considers its plans for privatising Indian airports to be a good idea. Already, ground handling services of Air-India, which were being looked after by its staff, are being contracted out to foreign companies.

The trend of cutting down public investment and expenditure in public services affects vital spheres of our society and people. Our public health, education and transportation systems are all integral to the development of India and the well-being of its people. The trend towards privatising water supply, electricity distribution and municipal services will result in more expensive essential services coupled with declining services for the poor.

While defending public services and fighting for more state expenditure to maintain them, the Left forces and the trade unions must also strive to improve their quality of service to the people. This is a vital issue. Badly run schools, hospitals and public transport discredit the public services and provide the impetus for the right-wing demand for privatisation of these services. While organising to fight for better working conditions, public service employees must work to end bureaucratic red-tape and streamline the services in order to serve the people better as an integral part of the fight against privatisation.

Prakash Karat is a member of the Polit Bureau of the Communist Party of India (Marxist).

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