For nearly fifty years now, we have been buying the myth that the private sector can do anything better than the government. The pandemic has exposed that myth for the lie it is. What has been happening in our long term care homes is the most painful example of that lie. Linda McQuaig writes:
Privatization has become a kind of economic dogma in recent years, with business commentators and politicians routinely asserting that the private sector is more efficient and always does things better -- an assertion that is rarely accompanied by any evidence.
In fact, the crucial difference separating the private and public sectors is that the private sector is focused on profit-making. Indeed, this is the only real purpose of a business enterprise.
So, regardless of what industry spokespeople say, a private company in the nursing home business is focused on maximizing profits, as its board of directors demands.
What has happened in Ontario starkly illustrates the primacy of profit over care:
Certainly, Ontario's three big private nursing home chains, which receive government funding under the same formula as not-for-profit homes, have been good at maximizing profits.
Over the past decade, the three chains paid out $1.5 billion in dividends to shareholders and $138 million in executive pay, according to the Star investigation.
The chains insist these payouts come out of profits they earn selling private services to residents in these and other retirement homes, which are not funded by government.
In fact, it's hard to know exactly what's going on, since the government is notoriously lax in its regulations and oversight of the industry -- as the pandemic vividly illustrates.
This laxness appears to be traceable back to Mike Harris, the former Conservative premier whose government removed minimum staffing levels for nursing homes in the late 1990s and encouraged the involvement of private businesses.
Long term care homes have been kind to Harris:
After retiring from politics in 2002, Harris has profited handsomely from the lucrative private nursing home industry he helped create, serving as chairman of Chartwell Retirement Residences, one of the three big chains. (His annual salary for this part-time position is $229,500, and he has $4.4 million in Chartwell holdings.)
Over the past decade, Chartwell paid its executives $47.3 million and distributed $798 million to shareholders.
Meanwhile, in the 28 nursing homes Chartwell owns or operates in Ontario, the COVID-19 infection rate has been 47 per cent higher and the fatality rate 68 per cent higher than the provincial average, according to the Star investigation.
COVID has been a myth buster. After the pandemic, the old myths won't sell.
Image: torontocitynews.ca
