Private Contractors Cost More, Not Less!

Mar 18, 2013

In all the hoopla about Detroit’s financial crisis, the media and the politicians are spreading the notion that privatizing city services will save the city money.

But the only study that actually compared the total costs of paying private contractors with the costs of paying government employees, found that, at the federal level, private contractors cost more, not less.

The Project On Government Oversight (POGO) found the federal government paid twice as much for work done outside. It studied 35 occupational categories in 2011 and in 33 of those, federal government employees cost less. In another, government workers cost under $1,000 more per year. In only one category, groundskeeping, were government employees more expensive.

If it’s true for the federal government it’s also true for every state, local government and school district that has outsourced so many departments to private contractors in recent years. They tell us “private” means “cheaper.”–Not true!

THIS is a BIG part of where those government deficits are going: into the pockets of the owners of private companies, paid many times what it would cost governments to do the work themselves. It’s a huge boondoggle to corporate profit, using taxpayer money.

They want to balance their budgets? Get rid of the contractors and bring the work back in-house! Hire MORE workers directly! Don’t cut OUR jobs, or OUR wages, or OUR benefits and services!