Read part I here.
Milei and the Chances of Privatization
Though privatizations have not yet arrived, the state-owned airline is on the agenda. The company was renationalized in 2008, forcing taxpayers to prop up an airline that has been directly bailed out by the government since 2021. For true privatization, all regulation prohibiting competition and all taxation in the industry should be abolished—falling short of this, it should come with deregulation and less taxation. Milei has proposed to give the company’s shares to its employees and thereby transfer ownership to them. They would either bear responsibility for the company or sell their shares. While this may be the most expedient method toward privatization in a country where unions have so much influence and power to negotiate, it is not a just course of action.
According to the homestead principle, assets belong to those who have worked on them, but the airline would not have been possible without the initial aggression against taxpayer property. The government legally owns the airline, but it does not justly own it. As for the workers, their only possible claim concerns their salaries, and even these, and all other costs involved in the operation of the airline, are primarily financed by taxpayers. As a matter of fact, to do what Milei proposes would constitute a moral outrage. Rothbard would state that the principle of privatization that should take priority wherever it applies would require the government “to return all stolen, confiscated property to its original owners, or to their heirs,” because property rights imply above all restoring stolen property to the original owners. Only those who have been aggressed into financing the airline have a justifiable claim to restitution.
If possible, legal ownership should always be restored to expropriated private owners or their heirs of socialized factors of production. But in this case, even though we know that the taxpayers are the rightful owners, legal ownership cannot work in the same way for tax-funded enterprises. The most just and sensible solution would seem to involve the distribution of shares among taxpayers in proportion to the taxes paid since 2008. However, an airline needs hierarchy and expert knowledge on its inner workings. For assets to be used, liquidated, or dismantled, some agreement among the owners about many complicated matters would still be required. Such a process would hinder any possible gains from this solution. If an entire bureau were created to go through tax documents and calculate a fair distribution of shares, this would impose an unjustifiable burden on taxpayers. The perpetrator of the injustice, in charging the victim a price for justice, would commit a further injustice. Moreover, the government, as usual, could err in its task by, for example, giving more or less than is due to the taxpayers, which could complicate the process of getting the company back in business or liquidated.
Benjamin Seevers proposes to combine the joint stock company and syndicalist approaches. Milei, he argues, should cease all government transfers to the airline and eliminate all government-granted privileges. The company should not be pardoned for its willing participation in taxation and expropriation, and taxpayers should be free to make claims against the now private airline. Milei could give the company to the bureaucrats who currently run it, but taxpayers should be able to bring claims against it in civil court for restitution in the form of payments, bonds, or shares. Seevers recognizes taxpayers’ legitimate claims to the company and wants to relegate its division to the “free market” rather than the government—mirroring the syndicalist solution first, turning it into a mixed system afterward. Following Seevers, the airline “should be cut off from the government altogether without caring how the former public employees organize the company,” and some legally binding order (perhaps an executive order) would state that the company’s expropriations of taxpayers are no longer legally protected, allowing them to extract rectification.
