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Privatization has
gone to extremes... part
of a pattern
TheDesMoinesRegister.com
Published March 25, 2007 Copyright © 2007
Doak: Privatization of public work
has gone to surreal extremes
It's all part of
a pattern.
In the military, jobs that used to be
done by soldiers in uniform are done by private
contractors operating in the shadows.
In job training, a bunch of local governments
set up a consortium that operated out of public
view and seemed more intent on overcompensating
its executives than helping displaced workers.
In health care, quasi-governmental entities that
hardly anyone ever heard of get hundreds of
millions in taxpayers dollars annually to do
something, but they won't tell you what.
Health care, meet Kafka.
The surreal world of publicly funded
quality improvement organizations (QIOs) was
examined last week by Register reporter Clark
Kauffman. There are 53 of them around
the country, mostly organized as nonprofit
corporations. They have contracts from
the government to oversee and improve health
care, but other than compensate their executives
exceedingly well, it's not very clear what they
do. As private entities, they're not required to
disclose very much, and the QIO in Iowa
certainly doesn't.
The government
should be overseeing Medicare quality itself, in
the open, rather than paying secretive private
groups to do it.
These strange,
tax-consuming organizations are examples of the
dubious trend of using private entities to
conduct the public's business.
One of the surprises of the Iraq war has been to
learn how many jobs that used to be done by
public employees (soldiers) have been turned
over to private contractors, everything from
running the mess halls to interrogating
prisoners.
It probably made
sense to contract out many of the support
services, but Congress could spend the next
decade investigating the corruption and waste in
no-bid contracts awarded to well-connected
corporations.
Privatization of public work, by and
large, has not been a
healthy trend lately.
Some work, of course, should be
awarded to contractors. The classic
example is building construction. It
would be wasteful and inefficient for
governments to maintain their own construction
crews. Governments should always be
alert for opportunities to save money through
contracting and competitive bidding.
But much of the privatization of recent
years has been driven not by money saving but by
ideology - an article of faith that the private
sector is always more efficient than the public
sector.
As anyone who has ever worked for a
corporation knows, the private sector isn't
always a model of efficiency.
The private sector is
better at some things. The public sector is
better at others. The trick is
to know the difference.
Some jobs, such as law enforcement or war, are
too important to be done by private companies,
even if they could do them more cheaply.
Anyone with the
power to deprive others of liberty or life in
the name of the American people should be a
public employee, accountable to the public.
Even fairly innocuous law-enforcement
contracting, such as hiring private companies to
enforce traffic laws by photographing speeders
or red-light runners, should make people uneasy.
Perhaps the worst aspect of privatizing public
services is that what normally would be public
information suddenly becomes private. You can't
maintain a democracy unless people know what is
being done in their name, by whom, and how much
it costs.
Contractors usually cite their status as
a private enterprise to
avoid answering questions. They refer to
"trade secrets" or "proprietary
information."
Tough. If they don't want to share
information with their clients (the public),
they shouldn't bid on the contract.
Anyway, companies that live off government
contracts often aren't private enterprises in
any meaningful sense of the term.
True private enterprises
compete in the marketplace for customers.
Contracting companies sometimes have no
competition and have only one customer, the
government. They exist solely to get government
contracts. And there's
always
the potential
that a contract will be awarded more on the
basis of political connections than on price and
quality.
The general rule should
be that the books of any entity doing government
work should be as open as if the work were being
done by the government itself. And
a condition of the
contract should forbid political contributions
being made by anyone associated with the
contracting company.
If the companies didn't like those terms, they'd
be free to take their chances competing against
the real private enterprises in the consumer
market.
RICHARD DOAK is a retired Register columnist.
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