It was the federal government’s Army Corps of Engineers that was responsible for the levees and other facilities that could not be relied upon. It was Washington’s FEMA that brought us the following debacles: thousands of mobile homes stranded in the wilds of Arkansas, while the need for them was and still is here in New Orleans; the purchase of these campers at the cost of some $70,000 each, while more sturdy prefab cottages were available at several tens of thousands of dollars less; the interference with and outright prevention of private organizations (Wal-Mart, for example) that were balked in their efforts to help us in our hour of need.
At the state level, Gov. Kathleen Blanco did not exactly cover herself in glory with her dilatory response to the levee board consolidation effort. Nor did New Orleans Mayor Ray “Chocolate City” Nagin exactly acquit himself well. Who can forget all those pictures of hundreds of yellow school buses cheek by jowl with thousands of people stranded in our “Sewer Dome?” Or his Honor’s refusal to accept the offer of a towing company who would remove all those automobile hulks from our streets, while paying the city for this privilege, and instead (temporarily) awarding this contract to the highest bidder.
Such debacles occur every day of course, with the post office (whose service is still even more pathetic than before), the motor vehicle bureau, sanitation, public housing, etc. One reason for the Katrina fiasco is that these same types of bureaucrats, civil servants and other time servers were suddenly called upon to operate in an emergency situation.
Did you ever wonder why such debacles rarely, if ever, occur in the private sector? One reason is the automatic feedback mechanism of the marketplace. We do not have continual crises concerning things like furniture, pizza and rubber bands because entrepreneurs responsible for providing such goods and services face a strict profit and loss test every day. Those who do a good job make profits and can expand their base of operation. Those who do not satisfy consumers in terms of quality, price, reliability, etc. register immediate losses. If they continue the error of their ways, they are eventually forced into bankruptcy. The ones who remain in business may not be perfect – there are always some who are on their way out – but by and large they are pretty good. Nor is there any guarantee that such pedestrian items will always be supplied well. They were not in the USSR when their government was in charge.
It is not an all or none situation. There are also negative feedback loops for politicians and bureaucrats. Presidents, governors and mayors can be voted out of office. The problem is, it takes up to four years to do so (recalls are very difficult), and we cannot focus our displeasure narrowly on Katrina failures. For example Bush (were he eligible), Blanco and Nagin might have done other things well (I cannot think of anything off-hand) and might thus escape voters’ displeasure with their Katrina activities. As to bureaucrats, if they are not “caught in bed with a live boy or a dead girl,” it is impossible to rid ourselves of them.
In sharp contrast, if we get a soggy, cold and tasteless pizza, we as consumers have much more control over the situation than we do when we are served up public sector counterparts. The problem is not so much the failures of FEMA or the Army Corps of Engineers, it is that the same organizations that have so dismally failed are still in business. Imagine if we had to put up with the poor pizza provider forever.
What lessons can we learn from all this? Why, to rely on the magic of the market for as much as possible and on government for as little as possible. Worried about poor schools and sanitation pickup? Privatize these industries. We do not need a government middleman to collect taxes from us and then pay civil “servants” to do these vital tasks. Even apart from graft and corruption, it costs twice to three times as much for the bureaucrats to do the job. Ditto for bus service, fire protection, housing, mail delivery – you name it.
Walter Block is a professor of business administration and Wirth chairman of economics.
