The Instigator
WaximusMaximus
Pro (for)
Losing
9 Points
The Contender
monetary_sniper
Con (against)
Winning
12 Points

Federally-Held Corporations are the best method for administering social programs.

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Voting Style: Open Point System: 7 Point
Started: 12/26/2007 Category: Politics
Updated: 9 years ago Status: Voting Period
Viewed: 1,585 times Debate No: 1026
Debate Rounds (3)
Comments (3)
Votes (7)

 

WaximusMaximus

Pro

A Federally-Held Corporation would allow the government to both cut taxes and provide greater social services for a lesser cost.

Let's take health care for example:
The Corporation would operate like an insurance company. Every citizen would pay in a premium and then receive services. However, the rates would be the lowest possible due to the fact this Corporation only needs to cover its own operational costs.

In addition due to its independent nature of the Corporation it would be under congressional oversight due to the federal government holding all of the stock but its budget would remain intact for its original purpose.
monetary_sniper

Con

Federally held corporations clearly are NOT the solution when it comes to administering social programmes. In reality, the United States would be far better off utilising either of the alternatives, as opposing as they may seem. The first way is to simply have the government reduce regulations for PRIVATELY held corporations: corporations that have the ability to operate far more efficiently than a company with the government holding it by the ear. So what's the difference with your proposal? Well... if the government allows private companies to administer social programmes and simply serves as a body that sets standards (and provides some basic guidance while doing so)and, moreover, provides reductions in taxes and fees that make operation not feasible, then the company functions in the most efficient way possible to conserve money (unlike a governmentally held company which will be plagued with paperwork of a calibre unimaginable by the human mind). Or... you simply stick with what we have today. Sure, it's not exactly "swiss quality" but full government control over social programmes has the advantage that congress and the applicable branches of government have the ability to dictate changes and have them realized rather quickly (although not as quickly as in a full private company). Furthermore, the general population's sentiments tend to drive federal programs' directions, something that usually prevents complete disarray.

So why not the middle answer? It only seems logical, right? We have been taught as we were growing up that things are not black and white but usually somewhere in between. I'll tell you why Federally held corporations are a terrible idea. Instead of forming a glorious conglomeration of the benefits of each side (fully private vs. fully public) you simply mix the problems and ditch the benefits. In a federally held corporation the government owns the majority stake, so they CAN dictate policy therein. Notwithstanding this ability, the manner in which they achieve this regulation is first going through the upper echelon to get a change in a social programme approved, THEN going down all the way to the company management who will have opinions of their own (it isn't 100% government owned of course) and getting them to agree. After that, it will be subject to intensive government regulation and taxes (it is not officially a government department). It sounds like a good idea, and I don't blame you for thinking it is so, but in reality it is plagued with every inefficiency possible and thus not the best method for administering social programmes.
Debate Round No. 1
WaximusMaximus

Pro

I sympathize with your points on administration and finance. However the I would disagree with you to say you get the best of both worlds and ditch the problems.

First of all I am sorry if in my first statement I did not make clear that the corporation in question would be 100% in the hands of the Federal Government. A charter for the corporation would be written, much like the Banks of the United States or the FDIC, outlining the specifics of what the corporation can and cannot do. Administrative decisions would be handled by the Board of Directors, all federal appointees and therefore under congressional oversight. Acting in an independent capacity, such as the Federal Reserve, the company would execute it's charter. Overall, social programs such as health insurance, workman's compensation, unemployment insurance would be handled by a citizen paying in a comparatively small premium in relation to tax dollars which can potentially go anywhere. Federally-held corporations offer efficiency and stability for the lowest possible cost.

To specifically deal with your points:
1. Yes, the government can dictate policy but any major changes in the services rendered by the corporation would be a breach of contract, which is illegal.

2. The corporation in question would fall under non-profit tax law. While regulation could be an issue the FDIC has operated quietly for years without any major difficulties.
monetary_sniper

Con

I sympathize with your points on administration and finance. However the I would disagree with you to say you get the best of both worlds and ditch the problems.

First of all I am sorry if in my first statement I did not make clear that the corporation in question would be 100% in the hands of the Federal Government. A charter for the corporation would be written, much like the Banks of the United States or the FDIC, outlining the specifics of what the corporation can and cannot do. Administrative decisions would be handled by the Board of Directors, all federal appointees and therefore under congressional oversight. Acting in an independent capacity, such as the Federal Reserve, the company would execute it's charter. Overall, social programs such as health insurance, workman's compensation, unemployment insurance would be handled by a citizen paying in a comparatively small premium in relation to tax dollars which can potentially go anywhere. Federally-held corporations offer efficiency and stability for the lowest possible cost.

To specifically deal with your points:
1. Yes, the government can dictate policy but any major changes in the services rendered by the corporation would be a breach of contract, which is illegal.

2. The corporation in question would fall under non-profit tax law. While regulation could be an issue the FDIC has operated quietly for years without any major difficulties.
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I thank you for your clarification. While you have addressed a few key issues on taxes and management, you have failed to address the inefficiencies that would plague Federally Chartered or held corporations (whatever your name of choice is). Mostly, this deals with the terrible inefficiency that government management (which is already bureaucratic beyond belief) of a chartered company (which will make the inefficiency even worse because of all the regulations it must meet by being so) will create. Why are privately held companies far more efficient than the government will ever be? Because for privately held companies money is the motive: anything that will speed up earning money will be enacted. For the government there is no such motivation: setting up a chartered company will simply form a company that operates under federal authority so it will not be dynamic. How long do you think it will take for any changes in policy to take place from the time they are accepted until enactment? For a private company it can be minutes, for a chartered company it could be months while it bounces between the applicable government committees and departments.

I agree that using the government to distribute social programs is an acceptable solution. If you are to do that, go with what we have now: it will be far more efficient than any chartered company. If not, go completely private, and now the consumer will win since there can be competition and competition only serves to help the consumer (well... as long as there is not illegal price fixing involved).
Debate Round No. 2
WaximusMaximus

Pro

Efficiency is the key, you are entirely right. As I said in the second round "Acting in an independent capacity, such as the Federal Reserve, the company would execute it's charter." This would solve your problem of having any decisions bounced between congressional committees or the departments of the executive. Any decisions that would affect the fundamental character of the corporation, found in the charter, would have to be altered with public assent due to contract law. The best of both worlds is indeed found. The actual operation of the corporation would be handled by the Board of Directors but any change in it's contractual relationship with the public would be under the direction of Congress.

To sum it up:
Board of Directors: Appointed by the government and handles regular corporate operation. Provides insulation from political winds.
Congress: Holders of all corporate stock and can make alterations to the charter if necessary and if it does not violate contract law.
Public: Receives services for paying into corporation. Alterations to corporation-public relations cannot be made other than when service contract is up for renewal (specified by the charter).

The beauty of the system is that if the corporation is that if it ever becomes inefficient to the point that a private insurance company can step in again and be more competitive it will happen. If run efficiently the federal corporation will naturally out compete the rest of the market because it doesn't have to meet the profit margin. Any alterations to the charter which would make the corporation less efficient would be extremely unpopular with the electorate. The corporation must remain dynamic to out compete the rest of the market.

It must be efficient because if Senator-so-and-so messed it up he won't get reelected. It must be efficient because it will be out competed privately if it is not. It must be efficient because it is independent enough to fire and hire the employees it needs to. It must be efficient or it will die.
monetary_sniper

Con

monetary_sniper forfeited this round.
Debate Round No. 3
3 comments have been posted on this debate. Showing 1 through 3 records.
Posted by WaximusMaximus 9 years ago
WaximusMaximus
Yeah well, difference of opinion. That's what this whole site is about.
Posted by monetary_sniper 9 years ago
monetary_sniper
Darn. I couldn't get to my computer fast enough... You know my arguments. It's inefficient.
Posted by monetary_sniper 9 years ago
monetary_sniper
Oops haha. I meant to quote your rebuttal. Might help to add quotation marks.
7 votes have been placed for this debate. Showing 1 through 7 records.
Vote Placed by oboeman 9 years ago
oboeman
WaximusMaximusmonetary_sniperTied
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Vote Placed by WaximusMaximus 9 years ago
WaximusMaximus
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Vote Placed by monetary_sniper 9 years ago
monetary_sniper
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Vote Placed by TheMasterBrask 9 years ago
TheMasterBrask
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Vote Placed by azrael777 9 years ago
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Vote Placed by Chob 9 years ago
Chob
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Vote Placed by SolaGratia 9 years ago
SolaGratia
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