As an entrepreneur focused on international development, I’m always intrigued by examples of private firms which provide public services at a lower cost and higher quality than traditional governmental alternatives. It is governance, after all, which most powerfully drives economic growth, so I’m always searching for ways to improve it. The recent California wildfires highlighted a wonderful example of this phenomenon in action.
In early November of 2018, record-setting fires raged across California toward the Pacific Coast. In front of this colossal blaze worked a tireless crew of passionate heroes, risking life and limb to protect the homes and properties of California residents. These brave men and women even managed to save the $50 million home of Kanye West and Kim Kardashian.
But these courageous firefighters have been treated with contempt, if not outright disdain, in the media for their efforts. Why? They are the hardworking employees of the private firefighting company Wildfire Defense Systems.
It is unfortunate and wrong that these firefighters haven’t been treated with the same respect and admiration as their publicly-funded peers. Not only is private firefighting a perfectly venerable profession, but the broader trend of privatized fire protection saves millions of taxpayer dollars while providing higher-quality fire protection services.
Firefighting was, until the 20th century, not a paid profession at all. Teams of volunteer firefighters would simply come together and pool labor and resources to fight fires, and this system worked incredibly well. For example, one of the most famous fires of all time, the Chicago fire of 1871, was battled entirely by volunteer firemen, as was the great Manhattan fire of 1835. The reasoning behind this was simple: fires don’t happen often enough to justify having a full-time paid firefighting squadron awaiting the next blaze to battle. They’ll simply spend most of their time loitering at the fire station.
This reasoning remains true today. As fire protection technologies, sprinkler systems, and the automotive industry continue to innovate and incorporate fire retardants into their designs, the overall number of fires in the US has steadily decreased:
Paradoxically, however, the number of publicly funded firefighters has increased by 50% over that same time period. In other words, there are 50% more firefighters fighting half the number of fires.
The reason for this waste of public funds is simple economics: publicly funded entities have an incentive to perpetually increase their budget by increasing expenditures. The easiest way to increase the expenditures of a fire department? Hire more firefighters! Whether or not the department needs them to effectively fight fires is entirely irrelevant.
In direct contrast to this, private firms are always seeking to minimize their expenditures, thus increasing their net profit margins. This means private firefighting firms wouldn’t be hiring so many more firefighters while overall fire rates rapidly fall. Moreover, private firms are always seeking new and innovative ways to satisfy customer demands, meaning they will provide better services at this reduced cost.
The proof of lower-cost, higher-efficiency private firefighters is in the facts: research shows that municipalities which switch from public to private firefighting services save anywhere from 10-50% in taxpayer dollars on firefighting costs, all while reducing the overall rates of fires, dollar losses from those fires, and civilian deaths from fires.
Taking a closer look at the company which has been so maligned in the media, Wildfire Defense Systems, the evidence of private-sector innovation in fire protection services is clear. Wildfire Defense Systems has dynamic fire risk analysis and prevention technologies on top of traditional dispatch firefighting services, and they offer these services in some of the most rural areas of the American West. What public fire department has a fire hazard assessment app that will generate a fire risk score for your home and property along with recommendations for improving fire safety?
Rather than attacking Wildfire Defense Systems or acting aghast at their service, the media should be praising these brave firefighters the same way they praise public fire departments regularly. Private firefighters do the same job with more efficiency and at a lower cost to the taxpayer.
That’s something worth praising.