What I find ironic about these fears is that privatization is incredibly difficult and in some cases impossible. Some people worry about a Robocop-like future, not knowing that private business would not touch many government activities with a ten foot pole.
Many public sector enterprises are actually so bad that no private individual will even pay a cent per share for them. The Rural Electrification Company here in India has been so utterly consistent in losing money that you should consider buying all its stock if you are considering a life of destitution and no longer need any money. British Airways and other old British public sector enterprises either took years to privatize or could not get privatized at all. A proposal to privatize could begin in the early 1970s and go on until the 1990s with multiple failed bids.
No, private business will not enter nuclear weapons and private business will not even enter nuclear energy. In the latter case, they require governments to guarantee their liability. In the former, they basically choose a business that could lead to their employees quietly being knifed in hotel rooms or restaurant toilets on a regular basis.
Keep in mind that “privatization” often means in practice that the monopoly and other legal constraints are maintained, but otherwise the ownership and management of the assets is transferred from the government to some private business. This is very different from the libertarian notion of “privatization”, which means eliminating the very things (monopolies, etc.) that are typically maintained!
Actually, the privatization need not involve monopoly, but something much worse than that.
It may involve nominally private businesses that are effectively told where to buy goods, where to sell goods, what goods to produce, how to produce them, what price to charge for the goods, what wages to give to workers and management, what personnel to hire, and so on. That’s what happened in India.
In fact, privatization probably should never happen. Those businesses need to be scrapped and dismantled. No, I do not suggest laying off thousands of workers. In fact, offshoot businesses will acquire those assets and take those workers with them. Think of it as what Vikram Pandit did with Citibank after the recession.
You’re right, privatization doesn’t have to involve monopoly. That’s why I wrote “monopoly and other legal constraints”. The latter part covers what you wrote about being told what to buy, what to sell, who to employ, and how much to pay/charge for each.