Privatization is good for Century II and Wichita

Opponents of privatization of Century II, including the website www.savecenturyii.org, seem to think that the operating procedure of a profit-making business is to place so many restrictions on the use of their product, and to raise the price so high, that no one uses it anymore. The reality is quite the opposite. For a business to make a profit and survive, it must provide a product or service that people want to pay for, and provide it with costs less than its price. What could be wrong with that?

A few examples from www.savecenturyii.org illustrate common misperceptions: “These private management companies charge rental and service rates so they can make a profit.” This is true. But underlying this sentence I sense two unspoken assumptions: First, that the rates the private management companies would be higher than the present rates. Might it not be possible that the new rates would be lower, if new management is more efficient or achieves greater volume? Second, the sentence implies that profit is evil. Compare that “evil” with the evil of supporting Century II users with taxpayer subsidies.

Profit is the motivating factor that businesses have that governments don’t have. Consider again how companies earn a profit. It’s by pleasing the customer, not driving them away. If they do this job well, they get to have a reward.

“In addition to paying rent, users are required to purchase services from the management company such as for box office systems and staffing, front of house personnel, security, etc., whether or not the user can provide them or does not need them at all.” This implies that the management company can set whatever policies they want, and that customers are forced to “take it or leave it.” But this is the way governments operate. Businesses sell to customers who have a choice. They have other sources to buy from, or they can refuse to buy at all. This applies, I think, in almost all cases to the customers of Century II, too.

“There are many examples throughout the country where privatization has created hardships for local users and ill will throughout communities.” Paying taxes to subsidize Century II events, so that people can attend events for less than their true costs, also creates hardship and ill will.

Privatization might lead to other benefits. I have heard complaints that it is impossible to schedule some types of events simultaneously because of lack of soundproofing. A private company might find it in their interest to invest in soundproofing so that there can be more events. Wouldn’t that be good?

What supporters of the status quo seem to forget is that when Century II requires a subsidy, it means that the public has to pay taxes so that the people using Century II can use it for less than the its full cost. Or, perhaps the users know this, but think it is good government policy. It is quite ridiculous for everyone to pay taxes so that symphony and music theater tickets can be cheaper than they might otherwise be. (On the other hand, the relatively well-to-do patrons of these events are used to paying taxes to support others, so maybe this is a way for them to get back a little.)

Here’s a quote from a Wichita Eagle story: “‘Typically, private companies, when they come in… make their money off the backs of local users,’ said Mitch Berman, executive director of the Wichita Symphony.” Remember that those who wish to use Century II presumably do so voluntarily, and even if Century II was private, using it would be voluntary. Currently, however, we all pay taxes, taxes we have little choice but to pay, to subsidize the rent Mr. Berman’s organization pays. This is taking money “off the backs” of local taxpayers, and it is absurdly hypocritical for Mr. Berman to compare voluntarily transactions with the power of government to tax.

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