EDITORIAL: Privatization doesn’t need to be crooked to be predatory

It is estimated that the proposed replacement of Pennsylvania State Stores through the sale of licensing rights will generate approximately a billion dollars of revenue.

Who is pushing for the privatization of the State Store system? Who is pushing for the privatization of the lottery system? Who pushed for the development of the Lancaster County Convention Center project?

There are perhaps a hundred million dollars in studies, legal fees, financing earnings, real estate commissions (State Stores must be sold or sub-leased) involved in privatization of the State Stores. Professionals who would sell their services circle as hungry wolves surround an old moose, salivating over the anticipated kill.

And out of the say hundred million dollars in earnings from ‘transaction costs’, perhaps five to ten million will find its way through political contributions from recipients of largess to Tom Corbetts’ re-election campaign for 2014 which is anticipated to cost $30 million. It is the Marcellus Shale sell out déjà vu.

There will be ample scraps left for Democrats such as Ed Rendell’s Greenhill Partners which reportedly “stands to make millions” from the lottery privatization. It takes two to tango. And the dance has been going on for a very long time here in Pennsylvania.

The public needs to ask: “Are these changes being made for our benefit, or to generate huge fees and profits for those involved?” In the sad case of Lancaster and the Convention Center Project, the question comes a decade too late.

Updated: January 31, 2013 — 11:15 am


  1. Well let’s face it – the group shouting “Foul” the loudest in both cases are the unionized workers who stand to lose the most if these changes take place. But the lottery, state stores, and turnpike are big targets because the workers have extracted wages and benefits well beyond those found in the open job market. If the state-run industries ran as lean as private industry, then no costs savings could be made and these discussion would not occur.

    Furthermore, those of us in private industry paying for the lavish benefits might come to the employees aid rather than cheering on the changes. Personally I’m ready to outsource the teachers, education administrators, firemen, and many other government workers. None of these groups came to my aid when my pension was wiped out by the private sector.


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