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«Public policy and social responses to privatization: A comparative analysis of Banking Sector and Public Utilities Reform in Greece» by Athanasios Tsakiris and Manto Lampropoulou

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189th International Conference
Manchester Metropolitan University 14-16 April 2014

«Public policy and social responses to privatization:
A comparative analysis of Banking Sector and Public Utilities Reform in Greece»

ATHANASIOS TSAKIRIS, PhD, Adjunct Lecturer, National and Kapodestrian University of Athens, Political Science & Public Administration Department

PhD, National and Kapodestrian University of Athens
Visiting Research Fellow, University of Peloponnese, Department of Political Science and International Relations

Privatization is a process of transferring property rights, assets, institutions, firms and operations from the ownership and control of the state to the private sector . During the 1990s, both socialist modernizers as well conservatives and neoliberals alike favorized the privatization policy in Europe and America. Privatization took various forms and was implemented through different tools and methods, mostly through selling state-owned companies to private investors. Privatization programmes included public enterprises, such as public utilities (e.g. telecommunication, electricity and water companies), banks, insurance and other financial sector firms and manufacturing companies. The policy was “justified” by its followers using a variety of real or exaggerated problems. As well, the motives, the goals and the type of privatization differed. In some instances, the purpose was to develop better functioning of publicly owned companies, since in many cases nationalized enterprises either had become overindebted or/and associated with poor service to the users of these companies. Sometimes governments transformed state-owned enterprises that were previously monopolies in their sectors into semi-private or private enterprises operating in deregulated and liberated competitive markets. In other cases, in order to finance new services or research and development (R&D), the governments used the policy of privatization for raising new capital either for the companies or for the state’s budget in times of public spending constrains. Last but not least, many public services that were offered through state agencies (in-house services such as IT, facilities management) are now being contracted out.
Along with the economic and productive activities transferred to the public sector, privatization touched some of the core social functions of government. The effect of neoliberalism and economic globalization is closely related to these developments. Governments are attacking the welfare state and its institutions, the viability of which is questioned. The ability of multinational corporations and financial institutions to transfer monetary assets from country to country pushes conservatives and socialdemocrats to reduce social spending and to create “market-friendly” policies privatizing even pensions and social security programs such as medicare and medicaid in order to keep the investments of multinational enterprises in the domestic economy. Moreover, these governments impose measures such as tax reductions for enterprises, easing of inflation pressures, improvement of public agencies’ quality and efficiency, abolishing bureaucratic structures etc. . Globalization is accelerating and capital is searching for profitable new markets with cheap labor and low taxes urging the elected governments to shrink or even abolish social state provisions. Thus, privatization can be conceptualized as a retreat of both the economic and the social functions of the state.
In Greece, privatization policies were initiated in early the 1990s, as part of the broader project of state reform. Privatizations were implemented mostly through the selling of shares of state-owned entities to private investors and individuals. Two major areas of reform were the banking system and the public utilities. In the past twenty years, most of the state-controlled banks were privatized and many utility companies entered the Stock Market. At the same time, these sectors were gradually liberalized under the single market pressures. Until the late 1990s, the financial industry was further deregulated following the principles and provisions of the Second Banking Directive of the EU and telecommunications and electricity markets were prepared to open to competition. The current economic crisis placed the privatisation programme at the top priorities of the government’s agenda and accelerated the ongoing reforms. Privatization policies produced various social and political reactions, which were expressed through the reaction of the affected groups, in particular, trade unions, pressure groups, social movements and the citizens as users of the privatized services. These actors opposed to varying degrees the politics of the privatization process and supported alternative ways of rebalancing the public-private boundary.

Read the whole text here tsakiris_lampropoulou_final_manchester2014

Written by antiracistes

16 Μαρτίου, 2015 στις 1:39 μμ


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