I’ve been reading through that 2009 Interim Report to Congress about defense spending in Iraq and Afghanistan. Of all the report’s conclusions and recommendations, here’s the kicker:
“The government still lacks clear standards and policy on inherently governmental functions.”
In other words, we have gotten so used the government privatizing things that we don’t even stop to think about it anymore.
Holding people in prison. Shouldn’t that be an inherently governmental function? Why has it become a multi-billion dollar private industry, instead?
Taxation. Shouldn’t that be an inherently governmental function? Not if you have political connections. Not if you live in Pennsylvania. Or California. Or Virginia. Or Wisconsin. (Or lots of other places here in the good ol’ United States.)
Eminent domain. Inherently governmental? Not since Kelo. Just ask anyone standing in the way of the Keystone XL pipeline.
Where is the line? Aren’t there still some things that are “inherently governmental” and should never be contracted-out to for-profit corporations?
And how much are they profiting, anyway? In a 2011 survey, 63% of government contractors reported making profit rates of more than 5% of revenues (26% of the companies made more than 10% profit).
But it’s still supposed to be cheaper, right? Another 2011 report found that government contractors pay their employees total compensation worth an average of 1.83 times more than what federal employees are paid.
How much money are we talking about? It’s hard to tell. Federal outsourcing was $500 billion a year in 2008. Since then, the Obama Administration has saved taxpayer money by in-sourcing.
But look at the hoopla about Sequestration. Remember that infamous George Mason University report calculating that the sequester would “cost the US economy 2.14 million jobs”?
That report was produced for the Aerospace Industries Association, which describes itself this way:
shapes public policy that ensures the US Aerospace, Defense and Homeland Security Industry remains preeminent and that its members are successful and profitable…
The AIA has been investing a lot of money lately, to ensure that its members are successful and profitable. (Read more here.)
And Rep. Hal Rogers’ bill to avoid a government shutdown? Looks to me like that was crafted to protect government contractors from the effects of sequestration – at the expense of federal employees and programs for the poor.
Just where IS that line between “government” and “business”?
Does it even still exist?