Murray N. Rothbard, “Privatization” (1986)

This short polemical economic essay treats privatization as a comprehensive political-economic program, not merely as an administrative reform. Rothbard’s scope runs from local services to federal assets, and from familiar public utilities to prisons, land, minerals, forests, and nationalized industries. Its central thesis is that privatization is intrinsically valuable because it transfers resources out of coercive political control and into voluntary productive use.

Privatization is the reversal of the deadly socialist process that had been proceeding unchecked for almost a century.

Rothbard’s first conceptual move is to rename privatization as “desocialization.” This turns a fashionable policy term into a reversal of socialism itself. The issue is not only whether private firms can perform public services more cheaply, but whether politicians and bureaucrats should command resources at all. He contrasts “creators and producers” with the “non-producers” of the state, arguing that government ownership imposes a parasitic burden on consumers’ living standards.

His second move is to ground efficiency in institutional incentives. Private-sector income, he says, depends on satisfying consumers, while government revenue is secured by taxation or inflation. The contrast is moral as well as economic: the market must court the consumer, whereas bureaucracy treats the consumer as a drain on its budget.

In the government sector, in contrast, income is unrelated to efficiency or service to the consumer.

The section titled “Politics as Economic Violence” radicalizes the essay’s reach. Rothbard rejects the conventional concession that government should retain functions private actors “cannot” perform. For him this is an empty category, because history and capital markets show that private enterprise can finance and operate even large-scale undertakings.

Anything and everything is fair game for privatization.

This universality is central to the essay’s argumentative structure. Rothbard first mocks the old socialist image of the whole economy run like the Post Office, then turns against more moderate claims about scale, necessity, and public incapacity. His answer is categorical rather than case-by-case.

Every good or service now supplied by government has, at one time or another, been successfully supplied by private enterprise.

The essay then shifts from principle to fiscal policy. Rothbard accepts the emerging 1980s argument that selling public assets could reduce deficits, but he presses it further than ordinary budgetary pragmatism. If defenders of deficits claim that public assets back public debt, they should support selling those assets. Federal land and natural resources become, in his account, not public wealth held in trust but productive capacity deliberately withheld from use.

In effect, the federal government has acted like a giant monopolist: permanently keeping out of use an enormous amount of valuable and productive assets: land, water, minerals, and forests.

Here Rothbard’s core metaphor changes from bureaucracy to monopoly and cartel. The state is not simply inefficient; it restricts supply, raises prices, and suppresses productivity by locking up resources. Privatization would therefore lower prices, raise output, and increase real income by releasing land, water, minerals, and forests into productive circulation.

The closing anecdote about Britain’s nationalized steel industry sharpens Rothbard’s attack on timid privatizers. When Sir Keith Joseph claims that a money-losing state industry cannot be sold because it would command no price, Rothbard treats this as economic nonsense. Assets always have some value if they can be transferred to productive private owners.

There is no such thing as no price.

The essay’s relevance lies in how clearly it expresses the libertarian case for privatization at its most uncompromising. Rothbard does not present privatization as managerial modernization, partial contracting-out, or deficit technique alone. He presents it as a broad dismantling of coercive ownership, a restoration of market calculation, and a release of assets from political control. Its final recommendation is deliberately simple: sell government assets even cheaply, keep selling, and let private enterprise reorganize them through voluntary production.