Privatization implies that a private company passes into the hands of the State.
Privatization is the procedure and result of privatizing . This verb refers to the transfer of a public company or an activity administered by the State to a private company . In this way, the management of what previously belonged to the entire society is left in the hands of businessmen who pursue their own benefits.
The etymological origin of the term that concerns us now is found in Latin. It derives from privatize , which, in turn, was composed from the sum of two components in that language: the verb privare , which means "to take something from someone who owned it" , and the suffix -izar , which is equivalent to «convert into» .
What is privatization
Privatization, therefore, implies a strengthening of the private sector to the detriment of the public sector . Defenders of privatization maintain that, in this way, state expenses are reduced and the imbalances generated by the State's participation in the market are avoided. What's more, they determine that it is a way to decisively reduce both external and internal debt.
Those who attack these processes, on the other hand, highlight that private interest does not usually coincide with public interest and that citizens, in the end, end up accessing more expensive services.
In Argentina, the privatization of the electricity service took place in 1992.
Some examples
Suppose that a national State has an airline that it owns. If you decide to privatize the company , you will sell this asset and lose control over the company. From then on, its new owners (who will have paid the State to keep the company) must take charge of the investments and expenses necessary for the company's operation, but they will also keep the profits it generates. The State will only obtain profits according to what is established by law (for example, through the collection of taxes).
In Spain , during the Popular Party government between 2011 and 2018 , there was a notable increase in privatization or, at least, the intention to develop it in a forceful way. The fact of implementing measures to promote the privatization of schools and even hospitals resulted in Spanish society taking to the streets complaining about the situation and demanding that both education and public health be maintained. Specifically, some of the slogans they have used against privatization are firm and forceful, such as "health is a right, not a business."
However, in other corners of the world, rulers are also betting more on this tendency to make different organizations private. In Greece , for example, the government of Alexis Tsipras ( 2015 – 2019 ) proceeded to privatize a total of fourteen of its airports, granting the concessions to a German company.
It should be noted that the opposite of privatization is nationalization : in this case, the State assumes control and management of an activity or a company that, until then, belonged to the private sector.