Katherine Shaver’s Washington Post article about French firm Keolis’ bid to manage Maryland commuter rail trains being possibly derailed by lack of disclosure about payments received for transporting Jews during the Holocaust is interesting on a number of dimensions. One of them, not Holocaust-related, is that Keolis is a subsidiary of SNCF (Société Nationale des Chemins de fer Français) which is a state-owned firm. So Maryland is considering following the lead of a number of other American jurisdictions and “privatizing” a public function by contracting it out to the government of France.
For the past thirty years a broadly neoliberal tide has swept all over the world, but France has gone much less neoliberal than other developed countries. As a result, it’s seems to have developed comparative advantage in state-owned firms and now has a lot of economic specialization in activities that are either inherently non-competitive (managing trains and electrical grids) or incredibly capital intensive (airplanes and nuclear power plants). My guess is that if everyone tried to copy France, it would be a disaster for everyone, but that to the extent that the bulk of the world has moved in the other direction this constitutes a broadly beneficial kind of specialization.
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