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Sunday, June 24, 2012

The privatization trap


From schools to prisons, outsourcing government's works typically ends with cronyism, waste and unaccountability

An employee of Immigration and Customs Enforcement's Stewart Detention Center in Lumpkin, Ga., waiting for the front gate to be opened.
An employee of Immigration and Customs Enforcement's Stewart Detention Center in Lumpkin, Ga., waiting for the front gate to be opened. The detention center is operated on contract by Nashville-based Corrections Corporation of America.  (Credit: AP)
The 99 Percent Plan is a joint Roosevelt Institute-Salon series that explores how progressives can shape a new vision for the economy. This is the first essay in the series.
Privatizing the government is one of the most active projects of the early 21st century.

Everything we once expected the government to do — from education to regulatory rule-writing to military operations to healthcare services to prison management — it now does less of, preferring to support markets in which these services are done through independent, profit-maximizing agents. Tools such as contracting out, vouchering and the selling-off of state assets have been used to remake the government during our market-worshipping era.

Privatization is one of the few political projects that enjoys bipartisan support: Conservatives cheer the rollback of the state, and liberals like to claim that the virtues of the free market are being used towards the egalitarian ends of public policy. The fraud and waste that often come with outsourcing these services has been well-documented. The private management in Iraq and the aftermath of Hurricane Katrina, and the lobbying efforts of corporate prisons have all provided horror stories of what happens when cronyism guides decision-making on behalf of the state. But privatization as standard government practice has problems that go far beyond the abuses of any single incident.

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