According to the article, profit has not been the primary goal for the utilities though, because there is limited scope for extracting profits from uncompetitive essential utility services - the focus instead has been on maximising shareholder returns. So in the case of the water utilities, they "borrowed £53bn in debt while distributing £72bn to shareholders", which of course is what the issue is now interest rates have risen significantly. The article describes this as "the tension between generating strong returns for investors in uncompetitive monopoly conditions and providing high-quality, affordable infrastructure to the public". The end result is still the same though - transfer of wealth in a socially destructive direction.
Specifically table 1 on page 2, "The ten industries with the highest profit margin", has the spots 1 (elec: 42.5% profit), 2 (gas: 40.5%) and 8 (water: 32.1%) being utilities.
See people who bought homes at 5% down versus people who waited to have 20% down. The people who took on more debt were rewarded nicely with huge gains, and the people, who were prudent, now decide on paying a few hundred thousand more, if they were even able to keep up with saving a larger down payment.
> Your options are to acquire appreciating assets quicker than your competitor, or you get left behind.
This is wrong twice over! First of all, they are effectively monopolies, they have no competitors in their industry. The only thing they are competing against is which company can extract money the fastest (at the expense of the company and English citizens). Second of all, from the article, they aren't spending the raised money on capital investments.
> For example, South East Water—thousands of whose customers were left without running water this summer—spent more on dividends and servicing its debt than on infrastructure in the two years to March 2022. Water bills for Britain as a whole have increased by around 360%, more than double the rate of inflation, since privatisation. Over that time, annual capital investment by the ten largest water and sewage companies has fallen by some 15%, according to research by the Financial Times (FT).
Privatization is an utter failure here, just as would be predicted given the situation, and it's crazy to see an attempt to rationalize it away.
I think that's what the poster above was trying to say - they're not competing for customers, they're competing for investors. Effectively their only products are ROI and share value.
And when I say it out loud, I get a little shock, as I realize how much all industries are trending that way. No matter how consumer-facing your business is, the real competition is for capital investment. Consumers had better hope that capital investment depends on their happiness, because if it doesn't, their happiness is going to slide far down the priority ladder.
The irony is we might all be complicit in supporting this dynamic by choosing to invest in whichever 401k/pension fund option offers the highest returns and lowest expense ratios.
Competitors who take large loans and fail to deliver are out competed by alternatives who went a more efficient route.
The profit margins are fixed, but everything is still competitive.
>The only thing they are competing against is which company can extract money the fastest (at the expense of the company and English citizens). Second of all, from the article, they aren't spending the raised money on capital investments.
The owners of the company are competing with others in society to buy land/houses/cars/services/etc.
Except, not every investor wants every investment to be highly leveraged in this way. The entire point of utilities in most peoples portfolios is as very stable dividend stocks. It’s the people running the company who have incentives to do these kinds of transactions.
That The Economist, the City of London's answer to Pravda, published this article at all is telling.
Do you mean it's extremely left wing? Or pro-authoritarian capitalist? Or the most left-wing publication you can find in an otherwise capitalist group?
Pravda is both the Russian word for ‘truth’ (правда) and was/is a publication advancing the interests of the USSR/Russian state establishment.
The ‘economist’ implies a similar ‘truthfulness’ (it must be right about the economy if it’s an economist!) and advances the interests of the London financial establishment.
But I do think it's a bit of hyperbole in a way, although I'm only tangentially familiar with the publication.
When the board is more like a group of Huns than a Shepard, you find that after you pay out the shareholders, the enterprise is toast. In some cases, like most recently in big box retail, the private equity investors are running an obvious and odious, but legal, fraud.
With utilities, the business is all about capitalization and cash flow. They should be stable and boring businesses. When they are exciting, the management is burning the candle at both ends.
Shareholder returns can come from profit, or selling off assets, or taking on loans, or underfunding pensions, or probably other ways financial experts can invent.
Maybe not today or this year or next year, but everyone is always going to want a return on the money they put in, whether it be owner or lender.
Or run a nationally important service into the ground and then need emergency government money to keep providing it.
There is the difference
They must have used the debt to finance operations, as opposed to cutting the dividend or even putting more money in.
This allowed them to continue to have profits in the short term, at the expense of higher interest costs in the long term (which probably cause higher prices for customers in the long term).
Of course they will! There's an entire industry (leveraged buy outs) built around it. And more generally, lenders will let you do dumb things with the money they lend you. As long as they expect to get paid back.
So, could a small business borrow money to pay it's owners? Probably not, it's not likely to get paid back. Could a multinational corporation borrow money to pay dividends? Yes, it's happened.
Water company does a debt bond issue, parent owning fund takes a % of the issue (enough so that the bond issue is a success at a good price), parent fund extracts all the funds raised as a dividend, and sells the % of the issue it own too
All while extracting management fees etc too
Without getting into the weeds, my point was that in order for owners to end up with cash in their pocket, the business has to earn a profit, at some point. And that profit must come from revenue (higher prices for customers) minus expenses (lower quantity/quality for customers).
You can insert a lender in there to shift when those cash flow changes happen, but the money must come from customers, eventually.
Barring any research and development that results in technology that will allow for lower expenses and/or increased production, but I do not think that is the case here.
Of course what happens is many business geared this was don’t make a profit, fail their banking covenants, interest on the bond rises and eventually they go bust leaving lenders out of pocket
It’s happened to many PE owned businesses
Instant Brands went bankrupt because it could not pay its debts in a timely manner, so lenders decided to take the collateral.
It is possible lenders did not do sufficient due diligence, or maybe they got unlucky, but they did not lend Instant Brands money specifically so Instant Brands’ owners could pay themselves (maybe they did if there was corruption in this case, but it is not the norm otherwise why would anyone lend to anyone?).
And of course, Instant Brands’ owners will lose equity and credibility in the bankruptcy, so it is not like any dividends made possible due to the financing were “free money”.
It's just fancy accounting talk for theft. A shell game. Like u/Spooky23 states upthread.
It's wrong. It doesn't make any sense. And yet here we are.
if it's on the balance sheet and you sell it for more than it cost you, then you have to book it as non-operating income, i.e. capital gains, i.e. profit.
When does profits don't materialize, the company goes bankrupt, the government rescues it (can't just cutoff power and water!) and everyone is happy! Well everyone but the majority of taxpayers who aren't also shareholders of the utilities...
There's this thing called a "leveraged buyback" where a company borrows money from lenders and uses that money to buy back shares.
It's the shareholders cashing out, so rather than a failed business with shares of $0 value, they have money and the loans are someone else's problem.
What about using revenue to buy it? You don't have to use (or have) debt to buy something with revenue.
So you could still be giving away money to cash out that is owed to someone else? If your revenue is based upon fictional income then these privatised public services will become tax payer problems because they can't be shut down.
> buybacks in any other fashion only increase debt.
- buybacks are taxed when a person gets money for their shares, as capital gains tax
- lots of corporate tax is about exactly the opposite of what you say; i.e. reaching inside a company's bank account and taxing its profits directly, rather than waiting for the money to flow out and taxing it as VAT/income tax/cap gains. A huge amount of money and effort is spent on balancing this correctly, with R&D credits, structuring profits to appear in the correct year, etc etc.
A water company caring about some international investors more than the people they serve, and siphoning money out to those foreign interests, borders on treason.
The UK structures water provision as regional monopolies. This should be a hilarious joke but it's the reality. You can't change water company without living in a different region. There is no effective market competition for water provision in the UK. We already rely on price caps to keep this state of affairs in check.
Pretty much the only argument that almost stands up for them is that they're quite good at contributing to private pensions as a byproduct of being good stocks because people need water to not die. We gloss over where the rest of the money goes, possibly into PR management around frequent sewage dumping.
This is how utilities/water work in the vast majority of the US. I’m unclear why you think this is strange? At the very least, it doesn’t explain the UK’s problems.
I've worked in both the public and the private sector and can definitely understand the argument. In my government job it was way easier to slack off and no-one really cared about the results. There was no actual pressure from above to hit targets. You had your budget and it didn't really matter what you produced. Not hitting deadlines was no big deal.
Compared to my normal jobs where there is a constant stress from management to be lean, efficient and hit goals. I hate it but the team spirit is much higher and I probably produce 10x in comparison.
Now pick something that's a natural monopoly, like water supply. Consumers can't choose water suppliers - deploying pipes is prohibitively expensive - so there's no incentive to lower prices. Instead the efficiency goes to paying shareholders and management. Additionally these companies often have set leases on the infrastructure. If you have a 20 year contract and you know the pipes will start to fail in 25 years if you don't do maintenance... why do maintenance?
Government departments might not be the most efficient, but we can demand they're open and report what they spend money on.
When something is of public importance, like a utility, it really seems that running it as a public service instead of a private company seems like the right call
Right, but efficient at what? The answer is almost invariably 'efficient at making money' - that's the whole point; competition normally forces alignment of incentives, wherein 'better' service (for some value of 'better') results in higher income. Thus a business that provides better service is more efficient at making money - the free market hypothesis. When there is a captive audience, as in the case of public utilities, there is no incentive to provide a better service, but the company goal is the same - make the most money - and they are freed up to do it in the easiest way possible, usually by cutting costs across the board and paring down the services to a bare minimum. This is still efficient in the sense that they maximise income for minimum outlay, but it's not in any way desirable for the customers who are forced to use the now crappy service.
/extracting/. Efficient at /extracting/ money. This is the metric that is being rewarded, and therefore this is what gets optimised. You also see this pattern when an asset stripping firm buys an ordinary competitive free market company and runs it into the ground. To align this with /making/ money, just having a free market isn't enough - the controlling entity has to be in it for the long term, and has to bear responsibility for the downside of any decisions it makes. Otherwise it's just plunder and flee, just as with the usual kind of private equity firm corporate raid.
That's because it's a more general category, not because it's a better category. Going the other way: privatisation can for example invest money up front to make operations cheaper.
That example does result in "better at making money" but that money can then be used to lower prices / increase quality / pay shareholders dividends / pay employees higher wages.
Out of these, we often just see
> can then be used to…pay shareholders dividends
During the welfare capitalism of the early 20th century, we did see lower prices, higher quality products, and higher wages. Then Jack Welch and his ilk discovered that you could axe entire departments, lay off thousands of workers, and pay that money to shareholders while your company crashes and burns.
Why invest in making better products than “the commies” if you can make cheap products on par with imports and fire factory workers/QA/research? They learned that if the consumer doesn’t have a competitive choice for a product that will break in 1 year vs one that will last decades, then why not sell 10s of the cheap one over and over?
"Often" seems like weasel words? Look at e.g. tech worker salaries rocketing up. Or the year on year improvements in key items such as cars and phones.
What you're saying doesn't jibe with my understanding of the 20th and 21st centuries' explosion of innovation and quality of life improvements.
If you think Fords and VWs are no better than Ladas, or SpaceX rockets aren't better than Soyuz rockets, or people flock to countries run by "the commies" vs, say, the US, due to the better products and wages in said "commie" countries, then we might just have a fundamental disagreement on the state of reality. But my understanding is the opposite is true.
> why not sell 10s of the cheap one over and over?
Companies can do that, but in a decent economic environment a competitor or twelve can spring up and offer products at different prices and levels of quality. E.g. not every restaurant is McDonald's. Why is that?
That’s not to say that good jobs and food companies don’t exist, as you pointed out we have tech jobs that lay well and other sectors. The divide between what’s achievable for the middle and lower class now vs the upper is staggering though. Having to worry about affording a mortgage, health care, food, etc is a reality for many Americans while a handful simply have to say what they want and they have it without batting an eye or considering the cost.
We can both pick and choose which sectors to look at to support either the idea that jobs are great or that wages are bad, my point is that there has been a very tangible shift for a decent number of companies to move away from good wages and benefits to giving C-levels and shareholders more money than they know what to do with.
They don't make any money unless they give the customers what they want, that's the whole point. It's so basic even animals have an instinct for it. That's why government and private business shouldn't be mixed.
I nominate his doorstep, since who is he to tell us where to poop?
What's more, a private company which has monopoly does not really have special incentive to respect deadlines and everything: it is the only choice, so customers won't deal with any competitor and are stuck with this private company.
What's normally the driving motivator in public companies to be efficient?
Fundamentally, it's the principle-agent problem. The customer isn't the one paying the bills. The customer is a politician or two who can heap money on the department or not, and they get praised for heaping money rather than saving money. The people paying the bills, taxpaying individuals and businesses, must do so or they go to jail. So why be efficient when your customers cannot legally avoid buying your service?
That is often at odds with “making profit” either from over hiring so there’s always fallback people on call to overbuilding so in 50 years your still under capacity.
The goals are entirely different and so should the incentives
This doesn't happen.
When the government is the customer, and the private company is maximizing profit, the company's effort goes towards figuring out how to 'raise' rates.
This might sound like free market, I'm just trying to increase prices while reducing my overhead (efficiency). But in practice you end up paying a lot for a little. So instead of government workers slacking off, you have even less well payed people slacking off, with managers making a lot of money.
If you ever had to go to a 'privatized' DMV you can see it. Just awful everything, because of cutting corners. Yet the company gets paid a lot. The money goes to the company leadership, it doesn't 'trickle' down to operations to do a better job.
You never invest in infrastructure - in 30 years since privatisation, water companies in Britain haven’t built a single reservoir, lose 30% of water to leaks and dump raw sewage on the beach where children swim
A profit maximizing company may reasonably say "oh this population is super expensive to serve so we will let services there stagnate or even remove services for that population because it is more efficient for us to focus elsewhere."
Or consider a subscription service that makes it considerably more difficult to unsubscribe. That increases profit while making the product actively worse.
Profit incentive leads to efficiency of profit extraction, which is only loosely correlated to efficiency of services for consumers and occasionally runs in total opposition to efficiency of services for consumers.
Cuz that never happens in the private sector, lol. Guess where I'm at now...
There was a week while consulting pre-COVID I tried to see how many hours of Skyrim I could play on Switch, both in the office and remotely. I got to about 11.
Yes but one way that happens is by ignoring unprofitable customers. That's great if you are a car dealership and sell higher end cars to wealthier people or run a botique grocery store with fancy all-organic produce, but terrible if you are (for example) trying to provide healthcare or education and decide that the profit margins aren't high enough for you to serve various segments of the population.
Sure, there's lots of pressure, but, at least for someone with my profile, it's limited by the fact that it's easier to walk away.
Your comment on the incentives of private companies missed his point about the competition aspect.
In practice this often means politicians will squawk about how a given public service that is inherently a cost center is "inefficient" (which is true in the economic sense because it is designed to use its entire budget and thus doesn't extract a profit), impose austerity by cutting its "bloated" budget (which is justified by also cutting the workforce and other cost factors) and then repeating this process until the public service is inoperable and its failure is seen as a demonstration why it must deseperately be privatised and sold to the highest bidder (who can now get the monopoly position at a fraction of its potential value). Potential extra steps along the way involve creating a (government-owned) corporation to make it easier to complain about its bad business performance.
On a related note, there is an independent "tax payers' association" in my country that makes a big deal about "tax waste" by highlighting (usually fairly small) public works that most often have legitimate uses/explanations but may seem absurd/wasteful at first glance but largely prefers to stay silent when it comes to business subsidies and such. They have a clear ideological bias and while the media seems to be somewhat aware of this, it's always interesting to see journalist report on inadequate welfare programs in the same breath as mentioning (and using b-roll of) the public "national debt clock"[1] installed by this association.
[1] The most recent example was a segment on youth debt stemming from welfare overpayments their parents received (which under the legal system at the time was partially imposed on underage children in the same household even if they didn't have any money - the law was recently changed so they could only be held liable for the amount of money they owned at their birthday when reaching the age of maturity). Ironically this debt was the direct result of the kind of legislation to cut "tax waste" (in this case: welfare overpayments) the association generally advocates for. The hook was something like "the government can be billions in debt but for a young person a much smaller amount can be life-ruining" but the lack of reflection was astonishing.
Ehhhh... nah. There is still a cost vs. return.
Postal Services, for example. $10 ships 1.1 packages on average, or they get efficient and $10 ships 1.9 packages, etc.
You absolutely see this in things like Medicare where $100 worth of spending doesn't get you 90-100 generic aspirin, but more like 20 pills, and the rest of it goes to pay middle men.
The problem with Medicare in the US isn't that Medicare is inefficient. The problem with Medicare in the US is that the US has a private healthcare system and Medicare exists on top of it. A universal public healthcare system wouldn't perform the same way in terms of bang for the buck because the dynamics would be very different.
So how do you extract profits then?
At least that’s they playbook they’re all using.
https://en.wikipedia.org/wiki/Railtrack
https://en.wikipedia.org/wiki/Network_Rail
https://en.wikipedia.org/wiki/Southall_rail_crash
https://en.wikipedia.org/wiki/Ladbroke_Grove_rail_crash
Edit: To be 100% clear the badly maintained infrastructure was the responsibility of a for profit private company at the point where people died.
> The passenger train operating company had failed to inform Railtrack and the signaller that the automatic warning system (AWS), which warns drivers of adverse signals, had been turned off in the cab of the HST.
But Ladbroke Grove was Railtrack's fault entirely (within the first few years of its creation). Meanwhile it's been 20 years since National Rail was created, when do we get to blame current governments and National Rail for bad infrastructure?
Railtrack made a lot of money by selling off land, and other assets, under invested and generally underperformed
> Railtrack made a lot of money
"Made" implies creation, growth, increase.
This is the opposite of what happened.
The money wasn't made. It was /extracted/. They /extracted/ a lot of money.
Railtrack doesn't have that money. Their succeeding entity doesn't have that money. The government doesn't have that money. The taxpayer doesn't have that money. None of that money was invested such that any of these entities might benefit from it in any way. It was removed from the system into private wallets.
The private owners plundered and fled, and the remaining skeleton was socialised again so it might regrow a bit of flesh from public taxes for the next extraction cycle.
https://www.channel4.com/programmes/ben-elton-the-great-rail...
When we sell our public investments for a quick buck we complain when the real cost of the service gets priced in. The trouble is, we pay the same taxes still, they just no longer go to the service we privatised, so we feel it in the pocketbook individually.
Presumably those taxes are going elsewhere now, but I was very happy with them going to core public services.
https://www.barrons.com/articles/usps-louis-dejoy-post-offic...
I, for one, think it's a good thing that people are entitled to their mail regardless of the profitability of their mail route. That's the point of a public service.
USPS is not a business, and it’s a fundamental mistake to pretend it is, solely for the sake of slandering it.
Among other core competencies, USPS has nationwide daily coverage of the entire United States and centuries(?) of experience interoperating the the respective mail services of every country in the world and then some.
Amazon wont even take MY package one town over.
That said, the service provided by the USPS nowadays is primarily delivery of paper waste into a receptacle I am obligated to empty because very occasionally they also use the same box for packages.
Amtrak gets surprisingly small amount of money.
However that doesn't change what I said so I'm not sure why you are bringing it up. Amtrak most likely wouldn't be profitable if they had priority.
Each big city we came to we had to stop and wait without having any idea how long it would take for “freight traffic to clear”.
I love train travel, and I’m not price sensitive at all, but the delays were completely absurd.
USPS delivers to remote addresses no one else’s will on route that will never make money.
I expect the maximum profit sweet spot actually includes a small amount of penalties. If you don't get any penalties at all, you are probably leaving money on the table re service cuts.
My experience in the UK and Germany is show up, pay, go, and it being cheaper.
This is arguably illegal and only exists because the govt refuses to enforce the obvious interpretation of the agreement.
Meanwhile, the US DOT has historically always taken the approach of "the solution is more highways. What's the problem?", losing far more than $1B/year.
If you find their service to be good and cheap, I can only assume you've never ridden a train in Europe.
I think the extent to which freight shoves aside passengers varies from region to region. My worst experience was going to West Virginia from DC. I find the Vermonter keeps its schedule pretty well.
You might as well say that the US military makes a $1 trillion loss per year. No, they supply something which is required by the govt and which has a cost.
2.) Raise the regulatory bar to prevent startups from entering your field.
Milk whatever half dead infrastructure you have and people depend on.
Oh and raise prices every odd year while still not investing in the rotten infrastructure. Somehow investors need to see growth and dividend payments.
Due to 1.) there is no competitor left that could offer a better service. People cannot simply switch.
Die to 2.) you are not in danger of ever having to face situation 1.) again.
Job of the government is to not let 1. and 2. happen.
I am new to this. Doesn't a dividend come from profits? What profits are there if you need debt? And who will loan to you if your business plan is to exit scam?
A dividend can be paid with money from any source, it's all money.
> And who will loan to you if your business plan is to exit scam?
Ambitious junior bankers. Or you get the government to guarantee your debt.
If you’re a water company, after government bailed out the banks, chances were good you’re not going bust. What are they going to do? Let the entire population of London die of dehydration?
It's a sham market.
Why should I pay higher prices/taxes to keep ticket offices 90% of the country and increasing don't use open?
International Airlines finished moving to e-ticketing 15 years ago
People: "ugh, I will use the app"
Company: "Look, nobody uses the front line staff"
30 years ago Terry Wogan was using his radio 2 breakfast show telling the 40-60 demographic how to send emails and watch his webcam. That demographic are now 70-90. I do sympathise for independent 95 year olds who can't use a ticket machine. I'd rather we spent the money in a far better way -- increasing services for example.
Nothing to do with accessible stations, where they simply look up entries in a database and will have very little personal knowledge.
Additionally, often the ticket office gives better rates -
https://twitter.com/CraigJordanBak1/status/16786743395735101...
The fact that you dont know this, betrays the fact that you havw no idea how the UK ticket prices are actually set
I mean, do you really not understand how earnings are calculated, or are you trolling?
It is a free market, you are free to open your own water company and build your own water pipes or deliver water in bottles. No one is stopping you
In Britain, British Telecom spent around 20 years making it impossible for other players to supply an internet service to consumers. They used various anti-competitive practices and had very good capture of the largely toothless regulator OfCom. This is all documented.
I was just at EWR last night waiting for an arrival and there was an old man looking for water. He asks an employee where to find some and she looks at him like he has two heads.
“You have to buy some. Or you can drink out of the faucet in the restroom”
Can you imagine that? Telling an old man at 1am he has to drink out of a bathroom fixture to quench his thirst.
In my mind, I was hoping he was flying to a more civilized country. Because that’s the system we’ve built for ourselves. In a better present, the man would have access to a drink for free. But because a profit needs to be made, the entire airport is organized around little nickel and dime scams.
Especially when the service is a necessity for many (Train to work, water to drink, electricity to keep warm and cook, etc).
There was an excellent book on the subject published this year called Our Lives in their Portfolios[^1].
[^1]: https://www.ft.com/content/7da72f9c-978b-41e7-8e4b-478818f74...
Here is how that works in American railways: https://m.youtube.com/watch?v=jNkYNjADoZg
And why they are on a road in implosion.
Most important is that the target service coverage, quality, etc should be decided by government (who should be seeking to please voters), not corporations who are seeking to please shareholders.
So the example of rail doesn’t really apply to this branch of the discussion.
However, once you’ve bought a house, it is very difficult to to but in new pipes from a different water works.
Have you seen the dividends and bonuses at Thames Water, or read the article posted here?
That’s a pretty amazing figure, how was that calculated?
Are you seriously arguing that that the Thames Water CEO was underpaid? They have been mismanaged extraordinarily. Their debts, losses, costs, service and environment records are so poor that nationalisation is being discussed. They have been paying dividends and bonuses throughout.
https://www.theguardian.com/business/2023/jul/10/thames-wate...
Paying more won't net you a better one.
Yes they do, from rival businesses, superior and new technology, just look at Chat-GPT potentially putting programmers out of work, or telegrams being made redundant by pagers, and text messages and email.
@arethuza
>CEOs of corporations of the same size quite often have to find and retain customers in competitive markets - which is hardly the case with Thames Water?
Water companies are delivering a minimum standard of water, call it the least toxic form of water considering the energy constraints and logistics of delivering water en-masse compared to other methods of obtaining water.
Mains water from a very young age always made me sick, so where possible I use bottled spring water in the kettle, but am currently considering a reverse osmosis water filter, to deionise the water in the house as much as possible.
Deionised water is the best tasting, sweetest tasting water I've ever experienced, and if I listened to the medical experts I should be dead on numerous counts of their assertations. So two fingers up to them as well! LOL
Carefully chosen words, someone has done their research!
Thats what happens when new standards come into force and improve upon the old standards.
https://environment.data.gov.uk/portalstg/home/item.html?id=...
"The purpose of this dataset is to present a summary of bathing water compliance in England between 1988 and 2014 against the old bathing water directive (76/160/EEC), which was repealed on the 31/12/2014"
However I'm not against better standards, but I am against some of the "engineered" methods used to gain those standards....
https://www.ciwem.org/the-environment/how-should-water-and-e....
As I was saying, some things are engineered....
There's so many factors potentially at play here and some of it we wont get to ever know about, but life has taught me there is manipulation in many guises.
What changed?
An upgrade to Eli Parsier's original filter bubble warning, one might say. https://www.ted.com/talks/eli_pariser_beware_online_filter_b...
In the examples here, no, CEOs don’t face real competition. Water companies are sold off public utilities. They way they make profit is to degrade service and raise prices. No one is going to install a competing water system. No AI is going to do that anytime soon.
The Economist has a political bent, but they are clear on how privatisation has gone: ‘Dogmatic adherence to privatisation in the face of its sustained failure suggests ideology, not pragmatism, was the motivation.’
> Water companies are delivering a minimum standard of water
No they aren’t. That’s a key point in the article.
So that other technologies, like rainfall capture systems and water filtration systems can be become financially viable through economies of scale. If you have a roof you can top up water tanks, water filtration systems clean the water and can recycle the water. Reverse Osmosis filtration which deionises the water is about as pure as you can get, so pure nothing can grow in it, which is why colony forming units (CFU's) aka TVC's are so low, lower than spring water.
https://www.gov.uk/guidance/spring-water-rules-for-local-aut...
This article explains why Thames Water is in the news. https://www.theguardian.com/environment/shortcuts/poll/2013/... "after 2025, Thames Water believes more drastic measures will be needed"
Not long to go.... standby for some more "engineered" news.
>The Economist has a political bent,
Whilst its easy to say, privatise problems, Thames water has its own unique problems, but when looking at something like the coal miners, what did it do? It shifted people away from using coal to other less large airborne particulate laden forms of fossil fuel, the latest being air source heat pumps 1w in 4watts out at best, solar power 15-22% efficiency, and nuclear with the debate over the use of different nuclear fuels, like plutonium and thorium. Sort by Specific Energy (MJ/Kg) at this link https://en.wikipedia.org/wiki/Energy_density#In_nuclear_reac...
Anyway some things are engineered including things in the news like Thames Water.... Someone's getting a shake down!
https://www.scottishwater.co.uk/About-Us/News-and-Views/2022...
I meant while applying to their own position. Not between corps. The CEO market is artificially small.
If the RMT had that amount of money I’ve no doubt Mick Lynch would be using it to buy the railways
Is that the combined salaries of all union members?
This is a nonsense delineation in systems thinking. That railroad shareholders are also the public doesn't justify ripping them off.
Unions are beholden to the same impulses towards monopoly and rent-seeking as corporations. Swap members (i.e. sellers of labour) for shareholders (i.e. sellers of capital) and employers (i.e. buyers of labour) for customers (i.e. buyers of goods and services) and union management starts looking remarkably like its corporate analog, churning undifferentiated workers into a differentiated and thus premium block of labour as truly as a mill grinds forests into houses.
They are the public, just not the UK public!
Labor and capital aren't the same concept no matter how much you scramble them. One is powerful enough that the entire system is named after it.
Lets see the shareholders:
* French government
* Chinese government
* Australian banks