one day i will write a long rant about privatization of government jobs. the short version is that sometimes privatization works (i.e. it allows the function previously done by the government to be done cheaper and more effectively) but sometimes it does not. the problem is that privatization is practically a religion to some conservatives these days–it is taken on faith that the free market is always cheaper, more efficient and better. in fact, there are many examples when that is not so (my longer rant, if i ever get around to it, will be about why it doesn't always work)
case in point: the u.s. forest service first spent $24 million to study the feasibility of privatizating some of the jobs done by its employees, and then decided to outsource about 250 jobs. the thing is, the privatization scheme is expected to cost the service an additional $425,000 per year. one of the former forest service employee was called back to his old job through a temp agency and found he would earning $4 less per hour with no benefits. (links via cursor)
this all begs the question, where is the extra $425,000 per year going if the new outsourced employees are earning less money. the answer, i suspect, is the money is puffing up the profit margins of the company that won the privatization contract with the forest service.
when government jobs are handed over to private companies, it is effectively converting non-profit work into for-profit work. because the for-profit operation must skim a profit margin off of the amount allocated for the job, there is an element of inefficiency in having the private contractor doing the job that would not be present if the government did it. proponents of privatization believe that government's inherent inefficiencies and bureaucracy will more than make up for the profit-margin-taking inefficiency that goes with private business. but private businesses can be bureaucratic too and sometimes there is no way for the contractor to operate at a profit without cutting corners. in the case of these forest service jobs, they are cutting corners by paying employees less, thereby making it more likely that the best people for the job will go elsewhere where they can make more money and get health insurance. but cutting corners in this case is not enough, so the private company is simply charging the government more to keep its profit margins wide. in the end this is really nothing more than corporate welfare.
