Editorial: The merits of privatization

POSTED: 08/15/11 12:31 PM

There is a huge kernel of gold in the admission that Winair will be in a better position if the airline is in the hands of a business person rather than in the hands of the government. One of the reasons for that is government should indeed be busy with regulating and not owning.
By virtue of the community we live in, we believe that people can see that very often government owned companies are extensions of the government in that there’s a fair amount of bureaucracy to change the leadership and very often the most senior people – the Board – change with the administration. There is also the fact that to a certain extent the government itself must review the company’s plans and say yay or nay but that can be painstakingly slow as government gets advice, builds political support and tries to please as many parties as possible. This kind of slowness is just bad for business.
On the other hand, private people, are led by the opportunities and make decisions much faster because their focus truly is: the company’s bottom line. No smart business person would allow their company to build up massive debts and continuously pump money into it, unless they’re doing something illegal. Instead owners will build in warning systems and ensure that they can take corrective measures. They will also ensure that when they do pump in, that it’s something that will help reduce costs or that will raise revenue further.
So yes privatization is good for Winair, but it’s important though that the airline clears up its current financial woes, before pressing forward as that will put them in a more attractive bargaining position to do things like maintain the staff that will need to keep their jobs when the deal is finally done.

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