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[PdotMichael]

In lots of countries those things are in the hands of corporations and that's just fine.

Auctioning 4G and 5G networks is the norm, since you need telephone companies to use them and that way you get the best price.

Harbors and airports are largely not run by the government, although the government might be a (majority) shareholder in some.

The nations are fucked, they just don't know it... I guess.

 

[Coriolanus]

Harbors and airports are largely not run by the government, although the government might be a (majority) shareholder in some.

Yeah, the private-public partnership method is quite acceptable. Can always backfire, as Petrobras shows us, but still better than selling it off for an immediate pittance.

 

[oti]

Does that mean they're gonna print new Euros without the Greek letters on them?

;_;

We made you, Europe, where would you be today without our super horny gods? Where I ask!?

 

[ClosingADoor]

Yeah, the private-public partnership method is quite acceptable. Can always backfire, as Petrobras shows us, but still better than selling it off for an immediate pittance.

I don't know how it is run now in Greece, but creating corporations to run those things and selling of shares is a pretty normal thing. It is then up to the government to decide how many shares they will sell and in what way (private or public).

It's not like someone is going "Hey Germany, want to buy our airport for 100 million!"

Raising VAT will hurt, don't know if that is such a good idea now. Probably not, since you already have people earning way too little at the moment. Taking more money from them is not a good thing. But it is not like they will up it to enormous rates. Some other EU countries have higher VAT.

 

[jakonovski]

In lots of countries those things are in the hands of corporations and that's just fine.

Auctioning 4G and 5G networks is the norm, since you need telephone companies to use them and that way you get the best price.

Harbors and airports are largely not run by the government, although the government might be a (majority) shareholder in some.

Other countries can take it, but Greece isn't exactly healthy. Right now shit would be sold off dirt cheap because it's under duress, and you can bet your ass the foreign companies involved won't ask for cheap rent. And the money from the sales will under no circumstances be enough to pull Greece out. Grexit, devaluation, government reforms, eventual return to normalcy, then you can think about selling something off to someone.

 

[wsippel]

This is the damaging stuff in the long run, it will give a little money up front but will hamstring future growth as foreign interests own everything in the country. Grexit would be better.

That's simply how it's done in most of Europe. And nobody says the stuff has to be sold to foreign investors. The Bremerhaven container terminal for example is owned by Eurogate, a German consortium. The Frankfurt airport is owned by Fraport AG, which is publicly traded but the majority is owned by the city of Frankfurt, the state of Hesse and Germany.

 

[Deleted member 231381]

That's simply how it's done in most of Europe. And nobody says the stuff has to be sold to foreign investors. The Bremerhaven container terminal for example is owned by Eurogate, a German consortium. The Frankfurt airport is owned by Fraport AG, which is publicly traded but the majority is owned by the city of Frankfurt, the state of Hesse and Germany.

You do realize that privatizing things doesn't actually help much, right? You can only sell things once. By contrast, Greece has to make sure people's pensions are paid every year. If anything, they actually make the situation worse, because under the status quo the Greek government earns money yearly from the profit run by airports and harbours it owns, which gives it a constant revenue stream. If you sell, that's gone.

Your advice to someone who doesn't have enough income is essentially "sell all your assets, even the ones that raise income". Can't you see how ludicrous this is?

 

[PdotMichael]

That's simply how it's done in most of Europe. And nobody says the stuff has to be sold to foreign investors. The Bremerhaven container terminal for example is owned by Eurogate, a German consortium. The Frankfurt airport is owned by Fraport AG, which is publicly traded but the majority is owned by the city of Frankfurt, the state of Hesse and Germany.

Exactly, and it gives foreign companies and investory the option to invest in Greece - without that Greece would lose the control of it's infrastructure.

It's not an all or nothing.

 

[jakonovski]

That's simply how it's done in most of Europe. And nobody says the stuff has to be sold to foreign investors. The Bremerhaven container terminal for example is owned by Eurogate, a German consortium. The Frankfurt airport is owned by Fraport AG, which is publicly traded but the majority is owned by the city of Frankfurt, the state of Hesse and Germany.

Or it will go to someone like Russia, which was a real danger telecoms faced in Finland about 5 years ago. I don't think the Greek private sector is very strong..

 

[ClosingADoor]

Other countries can take it, but Greece isn't exactly healthy. Right now shit would be sold off dirt cheap because it's under duress, and you can bet your ass the foreign companies involved won't ask for cheap rent. And the money from the sales will under no circumstances be enough to pull Greece out. Grexit, devaluation, government reforms, eventual return to normalcy, then you can think about selling something off to someone.

Of course you have to be smart about it. And charging rent? What are you talking about. The government will not be renting those things to use.

Getting foreign companies to invest in Greece might actually be a good thing, since now you have money coming into the country.

This is not just selling an airport to the highest bidder and be done.

Having private corporations run these things is the norm in most countries.

Or it will go to someone like Russia, which was a real danger telecoms faced in Finland about 5 years ago. I don't think the Greek private sector is very strong..

You can easily put in some limitations on the buyers. This is not a good argument against it. And again, you don't have to sell all. You can have the government keeping 51% of shares, or at least stay majority shareholder while selling parts.

You do realize that privatizing things doesn't actually help much, right? You can only sell things once. By contrast, Greece has to make sure people's pensions are paid every year. If anything, they actually make the situation worse, because under the status quo the Greek government earns money yearly from the profit run by airports and harbours it owns, which gives it a constant revenue stream. If you sell, that's gone.

Your advice to someone who doesn't have enough income is essentially "sell all your assets, even the ones that raise income". Can't you see how ludicrous this is?

Do they turn a profit at the moment? If not, they are just throwing money away by running it themselves.

 

[Coriolanus]

You can easily put in some limitations on the buyers. This is not a good argument against it. And again, you don't have to sell all. You can have the government keeping 51% of shares, or at least stay majority shareholder while selling parts.

I doubt anyone here is actively opposed to co-ownership with the government retaining a majority stake.

 

[jakonovski]

I'm not buying this polyanna stuff. The Chinese have already been very much into buying shit for cheap, and Greece is not exactly in a position to demand full market prices.

 

[wsippel]

You do realize that privatizing things doesn't actually help much, right? You can only sell things once. By contrast, Greece has to make sure people's pensions are paid every year. If anything, they actually make the situation worse, because under the status quo the Greek government earns money yearly from the profit run by airports and harbours it owns, which gives it a constant revenue stream. If you sell, that's gone.

Your advice to someone who doesn't have enough income is essentially "sell all your assets, even the ones that raise income". Can't you see how ludicrous this is?

That's assuming all those institutions actually raise your income, which might or might not be the case. And even if they're profitable, privatizing them and keeping the shares or selling parts of the company still tends to make more sense economically as the overhead is usually reduced and the companies tend to be more agile, competitive and ultimately profitable. You know, the rest of the world didn't privatize stuff because they had a collective brain fart.

 

[Deleted member 231381]

Do they turn a profit at the moment? If not, they are just throwing money away by running it themselves.

Well, there are two possibilities here. The first is that they do earn profit. If so, your suggestion was entirely useless - in fact, more than useless, harmful. The second is that they don't earn a profit. This has two sub-possibilities - either they can never earn a profit, or they can earn a profit but do not currently. If the first is true, then no foreign company will buy them (obviously), and they are being run for some reason of public benefit - i.e., planes to Rhodos, which is heavily isolated from basically everywhere and requires an airport just to receive basic goods and so on. Selling these does not help. If the second is true, then, yes, I suppose you could sell them to a foreign company and it would act as a short-term gain - but the emphasis is on short-term, because you then get a one-time piece of sales revenue, almost certainly at below market value given the nature of the sale, whereas if you took the time to improve these assets yourself, you go back to the very first possibility, in which they earn profit that the Greek government benefits from.

So, remind me again, why are we arguing for privatizations in the context of a government with income problems?

 

[Deleted member 231381]

That's assuming all those institutions actually raise your income, which might or might not be the case.

See my prior response.

nd even if they're profitable, privatizing them and keeping the shares or selling parts of the company still tends to make more sense economically as the overhead is usually reduced and the companies tend to be more agile, competitive and ultimately profitable. You know, the rest of the world didn't privatize stuff because they had a collective brain fart.

Oh, yes, I don't deny that privatized firms tend to be run better (although I might deny it in the case of airports, which are a quintessential case of localized monopoly). However, you're missing the point. It's all very well and good that the airport industry is somewhat more efficient - but the cost has been a reduction in Greek government revenue at a time when Greek government revenue is absolutely critical and is having a dramatic impact on the stability of the Greek economy. You're missing the forest for the trees. These firms can probably be privatized later, when the Greek government is secure, but doing it right now is stupid. I'm not sure anyone in Greece will care if their airport is slightly better at handling queues if the Greek government cannot pay their pensions as a result.

 

[ClosingADoor]

So, remind me again, why are we arguing for privatizations in the context of a government with income problems?

If you reason like that every sector in the economy can be run by the government. That's not the way it works.

Of course it is a short term gain, because they need money. But it also gets the government out of running some business they have no expertise in or any real reason to run. Also can get foreign investors in Greece, which is a good thing at the moment, since you want money coming into the country, not going out.

Also, this is not about just airports. Earlier things like 4G and 5G networks are mentioned. Those are licensed for certain periods of time (10 years, 25 years, whatever) so the government can auction them off multiple times.

Edit: The document mentions only regional airports, which tend to be a money sink at least over here for local governments. The Athens airport is already a private-public construction and is pretty profitable from what I can tell.

Edit 2: Turns out all that stuff is already approved by the Greek government and is just in the document to ensure they continue that path. So this is not some new demand that should come as a surprise to the Greek government.

 

[Earthstrike]

Of course you have to be smart about it. And charging rent? What are you talking about. The government will not be renting those things to use.

By rent he's referring to how businesses which purchase infrastructure from governments forced to sell it off end up having to pay way more back just to use it.

Getting foreign companies to invest in Greece might actually be a good thing, since now you have money coming into the country.

This is not just selling an airport to the highest bidder and be done.

Having private corporations run these things is the norm in most countries.
You can easily put in some limitations on the buyers. This is not a good argument against it. And again, you don't have to sell all. You can have the government keeping 51% of shares, or at least stay majority shareholder while selling parts.
Do they turn a profit at the moment? If not, they are just throwing money away by running it themselves.

Just because private companies running things is the norm in some countries doesn't mean it's better that way. Some industries aren't prone to competition, like telco's. Nationalized telecommunications infrastructure tends to serve the population better at a lower price when you examine the industry across developed nations.

 

[PdotMichael]

If you reason like that every sector in the economy can be run by the government. That's not the way it works.

Of course it is a short term gain, because they need money. But it also gets the government out of running some business they have no expertise in or any real reason to run. Also can get foreign investors in Greece, which is a good thing at the moment, since you want money coming into the country, not going out.

Also, this is not about just airports. Earlier things like 4G and 5G networks are mentioned. Those are licensed for certain periods of time (10 years, 25 years, whatever) so the government can auction them off multiple times.

Edit: The document mentions only regional airports, which tend to be a money sink at least over here for local governments. The Athens airport is already a private-public construction and is pretty profitable from what I can tell.

Edit 2: Turns out all that stuff is already approved by the Greek government and is just in the document to ensure they continue that path. So this is not some new demand that should come as a surprise to the Greek government.

Well, the deal doesn't look very bad.

http://www.reuters.com/article/2014/11/25/greece-airports-idUSL6N0TF2OX20141125

* German Fraport, Greek Copelouzos offered 1.23 bln euros

* The group will lease 14 Greek regional airports for 40 years

The winning joint venture will also pay an annual rent of 22.9 million euros, linked to inflation, for the airports. The deal is expected to conclude in the first quarter of 2015, HRADF officials told Reuters.

The German-Greek group is expected to spend about 330 million euros in the first four years to upgrade the airports, that will be leased for 40 years. Investment is seen totalling 1.4 billion euros over the period time.

Fraport said it would post an accumulated net loss of about 100 million euros in the first three years and that it expected to consolidate the airports in its results by the end of 2015.

That's clearly more than what are they would get now.

 

[Deleted member 231381]

If you reason like that every sector in the economy can be run by the government. That's not the way it works.

No, because there are other reasons why you privatize - i.e., you value efficiency in that specific industry. However, this is (obviously) a trade-off - the Greek government can chose between airport efficiency or airport revenue. Right now, which do you think is more important?

Of course it is a short term gain, because they need money. But it also gets the government out of running some business they have no expertise in or any real reason to run. Also can get foreign investors in Greece, which is a good thing at the moment, since you want money coming into the country, not going out.

This is, frankly, bullshit. Foreign investors will buy Greek airports because they know that Greek people will spend money at those Greek airports and then foreign investors get that Greek money because they bought those airports - that was the *whole reason they bought them in the first place*. This is utterly, utterly short term thinking - it takes money out of the economy in the long-run.

Also, this is not about just airports. Earlier things like 4G and 5G networks are mentioned. Those are licensed for certain periods of time (10 years, 25 years, whatever) so the government can auction them off multiple times.

Yes, but those things are fuctionally different. The government doesn't gain revenue from 4G or 5G networks because the government doesn't run 4G or 5G services from which they can gain revenue. If they sell them off, they're not jeopardizing any potential income.

 

[Ether_Snake]

People who say Greece should privatize this and that without actually thinking about how those things factor in the Greek context are jumping hoops. Greece is a mainland and a bunch of islands. That has implications for airports, telecommunications, and shipping, that are particular to that country. You can't just say "Well it's private in Switzerland!".

 

[ClosingADoor]

No, because there are other reasons why you privatize - i.e., you value efficiency in that specific industry. However, this is (obviously) a trade-off - the Greek government can chose between airport efficiency or airport revenue. Right now, which do you think is more important?

This is, frankly, bullshit. Foreign investors will buy Greek airports because they know that Greek people will spend money at those Greek airports and then foreign investors get that Greek money because they bought those airports - that was the *whole reason they bought them in the first place*. This is utterly, utterly short term thinking - it takes money out of the economy in the long-run.

Yes, but those things are fuctionally different. The government doesn't gain revenue from 4G or 5G networks because the government doesn't run 4G or 5G services from which they can gain revenue. If they sell them off, they're not jeopardizing any potential income.

These are complicated deals. There are a lot of pros and cons for sure. But from what I have read and what PdotMichael is posting, it seems like a pretty fair deal for the most part. The private company will invest money to upgrade the infrastructure while still paying rent. It will also be a lease, so they are not selling it forever.

Again, this is not like just putting assets on sale and hope for a good bid. A lot of work goes into these deals and the terms that can be decided on can vary very much.

People who say Greece should privatize this and that without actually thinking about how those things factor in the Greek context are jumping hoops. Greece is a mainland and a bunch of islands. That has implications for airports, telecommunications, and shipping, that are particular to that country. You can't just say "Well it's private in Switzerland!".

For the same reason you can't say "Well it's privatization and is bad!". It really depends on the deal and terms agreed upon.

 

[Prime crotch]

For the same reason you can't say "Well it's privatization and is bad!". It really depends on the deal and terms agreed upon.

Forced privatization always turns out the best outcome.

 

[Deleted member 231381]

These are complicated deals. There are a lot of pros and cons for sure. But from what I have read and what PdotMichael is posting, it seems like a pretty fair deal for the most part. The private company will invest money to upgrade the infrastructure while still paying rent. It will also be a lease, so they are not selling it forever.

They are, obviously, cons. Consider this for a moment. These firms intend to pay 22.9 million Euros rent. Consider two cases: a) Greek airports make less than this, b) Greek airports make more than this. If a) is true, these companies would not be so desperately keen to get such a deal (obviously, they'd be making a loss), and not putting such heavy weight on Greece to accept. If b) is true, then on net, money is leaving the Greek economy - the Greek economy gets less in through rent than it gets out through profits paid to German companies.

Surely you can now see why the Greek people are outraged - this is a fairly naked attempt by creditors to enforce unjust and economically damaging terms on the Greek people.

 

[PdotMichael]

Forced privatization always turns out the best outcome.

Only that they aren't sell-outs but the deals like the German-Greek consortium for the 14 regional airports were long and well prepared deals.

 

[tokkun]

If the second is true, then, yes, I suppose you could sell them to a foreign company and it would act as a short-term gain - but the emphasis is on short-term, because you then get a one-time piece of sales revenue, almost certainly at below market value given the nature of the sale, whereas if you took the time to improve these assets yourself, you go back to the very first possibility, in which they earn profit that the Greek government benefits from.

You are arguing off the premise that the government is just as capable of making the asset turn a profit as a private corporation is. You aren't considering the third option - what proponents of privatization claim - that private companies are capable of operating some assets at a profit that the government is incapable of operating at a profit..

The basis of the argument is that the private company is primarily motivated by profit, and the shareholders only make money if the company does. Therefore they will make decisions based on profitability. On the other hand, elected officials make their money by being re-elected (or in the case of corrupt officials, through graft). Therefore they make decisions based on political expediency that may hurt profitability.

If this is case, the government benefits both from the short-term income from the sale, but also from the long-term income of not running a money-losing operation.

 

[ClosingADoor]

They are, obviously, cons. Consider this for a moment. These firms intend to pay 22.9 million Euros rent. Consider two cases: a) Greek airports make less than this, b) Greek airports make more than this. If a) is true, these companies would not be so desperately keen to get such a deal (obviously, they'd be making a loss), and not putting such heavy weight on Greece to accept. If b) is true, then on net, money is leaving the Greek economy - the Greek economy gets less in through rent than it gets out through profits paid to German companies.

Surely you can now see why the Greek people are outraged - this is a fairly naked attempt by creditors to enforce unjust and economically damaging terms on the Greek people.

They are also investing 1.4 billion in the airport, money the Greek government does not have to invest to improve the infrastructure. Those improvements can lead to bigger profits for the airport, so when the lease is up it is worth more and meanwhile that company still pays taxes over the income.

I'm just not on the whole "privatization is always bad" bandwagon that some seem to have going on.

 

[Deleted member 231381]

You are arguing off the premise that the government is just as capable of making the asset turn a profit as a private corporation is. You aren't considering the third option - what proponents of privatization claim - that private companies are capable of operating some assets at a profit that the government is incapable of operating at a profit..

The basis of the argument is that the private company is primarily motivated by profit, and the shareholders only make money if the company does. Therefore they will make decisions based on profitability. On the other hand, elected officials make their money by being re-elected (or in the case of corrupt officials, through graft). Therefore they make decisions based on political expediency that may hurt profitability.

If this is case, the government benefits both from the short-term income from the sale, but also from the long-term income of not running a money-losing operation.

I mean, this is true in certain industries, yes. It's almost certainly *not* true in the case of airports, harbours, and the like; which are natural monopolies and very difficult to lose money on unless you are purposefully doing so. As an example of this in developed country, look at the catastrophic management of National Rail in the United Kingdom after privatization - it is now both less profitable and offers less customer value than it was under government management. This is particularly true in Greece and of airports at the moment given the argument you've provided (political expediency) is close to irrelevant in this specific case - given the current situation of the Greek economy, essentially nobody is voting with their key motivating issue being how airports are run, so there are no politically expedient moves to be made regarding airport management under the status quo anyway.

 

[PdotMichael]

You are arguing off the premise that the government is just as capable of making the asset turn a profit as a private corporation is. You aren't considering the third option - what proponents of privatization claim - that private companies are capable of operating some assets at a profit that the government is incapable of operating at a profit..

The basis of the argument is that the private company is primarily motivated by profit, and the shareholders only make money if the company does. Therefore they will make decisions based on profitability. On the other hand, elected officials make their money by being re-elected (or in the case of corrupt officials, through graft). Therefore they make decisions based on political expediency that may hurt profitability.

If this is case, the government benefits both from the short-term income from the sale, but also from the long-term income of not running a money-losing operation.

The more likely outcome is. That the company creates such a higher profit that both sides running a surplus from the deal - even if something was profitable before the privatization.

Happens all the time.

 

[ClosingADoor]

I mean, this is true in certain industries, yes. It's almost certainly *not* true in the case of airports, harbours, and the like; which are natural monopolies and very difficult to lose money on unless you are purposefully doing so.

Regional airports like the ones this is about are very, very easy to lose money on. Over here we had the government needing to step in for multiple smaller regional airports to keep them funded (I don't know why, let them go broke if nobody uses them).

 

[Coriolanus]

Before we keep trying to argue on whether these airports should be leased, could we first find some data that shows if they are or are not turning up a profit right now? Seems a bit silly to even engage in that argument otherwise.

They are also investing 1.4 billion in the airport, money the Greek government does not have to invest to improve the infrastructure. Those improvements can lead to bigger profits for the airport, so when the lease is up it is worth more and meanwhile that company still pays taxes over the income.

While i`m all for the general gist of your argument, to say that whatever infrastructure improvements they implement will be relevant 40 years down the line, when the lease will be up, is a bit... ahm... weird. If anything, it`s quite likely that as the deadline approaches they'll resist upgrading whatever they can, leaving the shambles of a structure in place.

 

[Deleted member 231381]

Regional airports like the ones this is about are very, very easy to lose money on. Over here we had the government needing to step in for multiple smaller regional airports to keep them funded (I don't know why, let them go broke if nobody uses them).

Yes, they fall under the second part of my statement - "unless you are trying to". Regional airports aren't kept open to make money. They're kept open to act as a public service - i.e., to allow communities like those on Rhodos to actually continue living there instead of having to move to mainland Greece and abandon all of your roots and background. Because they're not kept open to make money, private companies won't take them over unless they're offered subsidies. At the point, you end up with a *massive* agent-principal problem, where private companies have a massive incentive to exaggerate costs in order to get greater degrees of subsidies.

 

[ClosingADoor]

Before we keep trying to argue on whether these airports should be leased, could we first find some data that shows if they are or are not turning up a profit right now? Seems a bit silly to even engage in that argument otherwise.

While i`m all for the general gist of your argument, to say that whatever infrastructure improvements they implement will be relevant 40 years down the line, when the lease will be up, is a bit... ahm... weird. If anything, it`s quite likely that as the deadline approaches they'll resist upgrading whatever they can, leaving the shambles of a structure in place.

You can easily work those things in the deal. If it is signed, you can't just have a company going "well, not going to invest anymore, later!". This is all just assuming things and there are perfectly capable people who can work out those deals and make sure those possibilities are locked down.

But you are right that discussing specifics like this is not that worthwhile. Selling a few assets is not going to get Greece back on track, it needs a lot of reforms and investments to do that.

 

[Theonik]

Regional airports like the ones this is about are very, very easy to lose money on. Over here we had the government needing to step in for multiple smaller regional airports to keep them funded (I don't know why, let them go broke if nobody uses them).

Because profitability for what can be considered vital infrastructure is not necessarily important. There are local economies that would collapse if the government does not subsidise these resources. Which is why often when those deals are made, the governments are usually clever and bundle the profitable services, with the less profitable ones and set conditions that force private entities to provide these vital services or lose their contract.

 

[Calabi]

So if Greece cant pay for food and vital supplies(medical stuff etc), is the rest of Europe just going to watch them starve and die.

 

[Durante]

You know, the rest of the world didn't privatize stuff because they had a collective brain fart.

That's actually one of the more realistic reasons for privatization I've seen, at least given the usual outcome I've observed.

Well, there are two possibilities here. The first is that they do earn profit. If so, your suggestion was entirely useless - in fact, more than useless, harmful. The second is that they don't earn a profit. This has two sub-possibilities - either they can never earn a profit, or they can earn a profit but do not currently. If the first is true, then no foreign company will buy them (obviously), and they are being run for some reason of public benefit - i.e., planes to Rhodos, which is heavily isolated from basically everywhere and requires an airport just to receive basic goods and so on. Selling these does not help. If the second is true, then, yes, I suppose you could sell them to a foreign company and it would act as a short-term gain - but the emphasis is on short-term, because you then get a one-time piece of sales revenue, almost certainly at below market value given the nature of the sale, whereas if you took the time to improve these assets yourself, you go back to the very first possibility, in which they earn profit that the Greek government benefits from.

So, remind me again, why are we arguing for privatizations in the context of a government with income problems?

Well said.

 

[wsippel]

That's actually one of the more realistic reasons for privatization I've seen, at least given the usual outcome I've observed.

Looking at my Deutsche Post shares and knowing how public utilities operate, I can't confirm your observations.

 

[jakonovski]

Looking at my Deutsche Post shares and knowing how state owned utilities operate, I can't confirm your observations.

Looking at the Finnish postal service, I can.

 

[PdotMichael]

Airport privatizations aren't really a problem because the private company makes only money if so many air lines as possible are using the airport, so the company and goverment share the same goals.

It's not the same as water services which are way more complicated to handle

 

[Prime crotch]

Looking at my Deutsche Post shares and knowing how public utilities operate, I can't confirm your observations.

The same issues that afflict state owned entrepises can also affect private with dispersed ownership.

 

[Deleted member 231381]

The same issues that afflict state owned entrepises can also affect private with dispersed ownership.

Or indeed, ownership that changes hands frequently. Many shares traded rapidly does not make for good company governance.

 

[Coriolanus]

Y'know, my whole problem with the whole privatization discussion is that it is completely tangential to the root cause. No one here (i guess) harbors the illusion that privatization, however tackled, will solve the debt problem, or even stop it from rising.

Thus, when you privatize, all you're doing is giving even more money to creditors while increasing your debt in exchange for... what, exactly?

I mean, even in the context of the whole packet of proposed reforms, one would have to be a bloody fucking idiot to think that they'll change Greece's situation, given that some level of all of those reforms has been attempted. This isn't even a double or triple-down. They're far past beyond that point.

Additionally, when it inevitably goes to shit yet again, we can be sure to be presented with the same arguments as usual, so, really, what's the bloody point?

 

[Theonik]

Airport privatizations aren't really a problem because the private company makes only money if so many air lines as possible are using the airport, so the company and goverment share the same goals.

It's not the same as water services which are way more complicated to handle

For many Greek islands, airports and shipping are as important if not more important than water. In fact many of them need water supply from other places via boat. You simply cannot just draft some deal, tie it to some unrealistic target and call it a day.

 

[tokkun]

So if Greece cant pay for food and vital supplies(medical stuff etc), is the rest of Europe just going to watch them starve and die.

Let's try to keep things in perspective here. The per-capita GDP in Greece is still 2X what it is in Latin America, 3X China, and 15X India. Times are tough, but they are not exactly at the level where mass starvation is a threat.

 

[Deleted member 231381]

Y'know, my whole problem with the whole privatization discussion is that it is completely tangential to the root cause. No one here (i guess) harbors the illusion that privatization, however tackled, will solve the debt problem, or even stop it from rising.

Thus, when you privatize, all you're doing is giving even more money to creditors while increasing your debt in exchange for... what, exactly?

I mean, even in the context of the whole packet of proposed reforms, one would have to be a bloody fucking idiot to think that they'll change Greece's situation, given that some level of all of those reforms has been attempted. This isn't even a double or triple-down. They're far past beyond that point.

Additionally, when it inevitably goes to shit yet again, we can be sure to be presented with the same arguments as usual, so, really, what's the bloody point?

Yup. If the sticking point in any serious proposal is privatization, it is indication that whoever made the proposal has absolutely no serious intention of attempting to fix the problem. It's farcical.

 

[PdotMichael]

Optimizing your budget income is like the most important job of a government. If Syriza isn't capable of even doing that why would you want to invest even more money into that country?

 

[Coriolanus]

Optimizing your budget income is like the most important job of a government. If Syriza isn't capable of even doing that why would you want to invest even more money into that country?

It's just that what Syriza thinks is an optimized budget and what the creditors think is an optimized budget are Very Different Things.

 

[Deleted member 231381]

Syriza is capable of doing that. It's just that what Syriza thinks is an optimized budget and what the creditors think is an optimized budget are Very Different Things.

Or rather, the creditors know what an optimized budget is but don't want one; they want an immediate debt-repaying budget, which is a rather different thing.

 

[wsippel]

Or indeed, ownership that changes hands frequently Many shares traded rapidly does not make for good company governance.

Deutsche Post was a heavily subsidized, horribly bloated mess when it was privatized and is now the global leader in logistics. They pay around a billion bucks in dividends a year and therefore contribute a couple hundred million to the yearly budget, as Germany still owns 20% of the company. So yeah, it took a few years to sort things out but they're doing very well now. Like all things, privatizations have to be done right, but if they're done right, they make a ton of sense.

 

[PdotMichael]

For many Greek islands, airports and shipping are as important if not more important than water. In fact many of them need water supply from other places via boat. You simply cannot just draft some deal, tie it to some unrealistic target and call it a day.

Frapport isn't some low-tier company but operates airports in all parts of the world successful.

And the most important point of the deal was that they are just leasing the airports, so the ownership of the airports will not change.

It's just that what Syriza thinks is an optimized budget and what the creditors think is an optimized budget are Very Different Things.

With stunning results.

 

[Durante]

Y'know, my whole problem with the whole privatization discussion is that it is completely tangential to the root cause. No one here (i guess) harbors the illusion that privatization, however tackled, will solve the debt problem, or even stop it from rising.

Thus, when you privatize, all you're doing is giving even more money to creditors while increasing your debt in exchange for... what, exactly?

I mean, even in the context of the whole packet of proposed reforms, one would have to be a bloody fucking idiot to think that they'll change Greece's situation, given that some level of all of those reforms has been attempted. This isn't even a double or triple-down. They're far past beyond that point.

Additionally, when it inevitably goes to shit yet again, we can be sure to be presented with the same arguments as usual, so, really, what's the bloody point?

A very good point.

One might almost get the idea that the goal of insistence on a privatization requirement is generating a Steam Sale on Greek assets. But that's just silly, isn't it?