Thursday, April 14, 2011

Campaign behind the curve?

According to a specialist on local governments and economic development, outsourcing government functions (a.k.a. "public/private partnerships") does not live up to the cost savings promised and is actually the wave of the past, not the future:

Privatization peaked among local governments in 1997. From 1992 to 1997 new outsourcing contracts accounted for 18 percent of all service delivery, while in-sourcing was 11 percent. The ratios shifted in the 1997-2002 period with in-sourcing exceeding new contracts out by 50 percent. From 2002 to 2007 the rates were about equal (new contracts out were 11 percent, contracting back in was 12 percent). So the pendulum swings.

So, is this tweeted talking point pushing the envelope or falling behind the curve?

"Public/private partnerships" sound warm-and-fuzzy in theory, but because of real-life incentives and interests, they do not solve government's problems like real reform initiatives do.

UPDATE: I continue to muse over the implications of the "pendulum swing" away from outsourcing government functions and I feel lead to underscore another point from the NY Times op-ed linked above. The author observes that citizens prefer local services to be locally controlled and publicly delivered rather than parceled through private interests. She gives some of the reasons why local governments pull an about-face and insource previously privatized work:

the reasons are problems with service quality (61 percent), lack of cost savings (52 percent), improvements in public delivery (34 percent), problems with monitoring (17 percent) and political support to bring the work back in house (17 percent).

To complicate matters of privatization in Nashville is that there are networks of patronage that would seem to mute or mitigate the valid reasons for curbing privatization. I'm not even sure that campaign finance reform would check Metro's political influence cartel.

1 comment:

  1. I'm gonna go put on Dark Side of the Moon and watch Wizard of the Oz with the sound off. After reading that, I need some reality.