I have recently written quite a bit about how as much the federal government has expanded in the past five decades, federal employment has remained relatively stable. Part of this is frankly due to competent administration by capable employees (see my "Sensible Libertarian" post for details on my belief that while government is too big, not all of its employees are bloodsucking drones). But part of it is also due to outsourcing. Apparently Eisenhower was onto something when he warned about the dangers of the military-industrial complex.
In the past fifty years federal government contracting has grown by [I'm too lazy to do the research myself so just insert your guess here- it is bound to be too low and the facts are bound to be too depressing to read].
Some might argue that this is a positive development. Should not proponents of the free market system encourage the federal government to enter the private sector and search for and hire services like any other participant? Surely the market will provide the government with the most affordable, effective solutions- yes? One needs only to drive from Dulles airport toward Washington, veering off onto any of the numerous state road arteries that surround the Capital to understand why this incorrect. Money is being made, and it is not by the rules of the market. If it were, half of these Uncle Sam suckling companies would be a fraction of the size they are. Instead Washington is surrounded by well-lit, recently constructed office buildings housing firms engaged in murky, questionable business dealings with the national government.
Washington cannot be a normal private actor and it should not try to act as one.
Since I have been a bit rough on traditional conservative values lately (suggesting federal employees are, by in large, decent fol; questioning the value of outsourcing federal work), I will begin with an axiom of right wing thought.
Affirmative action skews the marketplace. If two equal actors are seeking to participate in the market factors like price, location, service, and ability should influence which fares better, correct? Not if affirmative action is at play. If quotas and preferences are employed, than the market is tilted in favor of not the most deserving for market demands, but for social demands.
This is a major issue in federal contracting where sex, race, veteran status, and other factors can impact which bidder does or does not get a contract. Defenders of affirmative action would claim that minimum standards must still be met- but is not part of the market process negotiating for as much as possible, not just the minimum standard? Additionally, if the minimum standard is all that is ever sought, might those companies which can attain it, and then gain contracts with their protected status, not become the de facto best companies available? In other words, not being a member of a protected class becomes not just a leg up for the minority group- but a kick in the shins for the unprotected group.
Put another way: centralized social planning does not work, just like centralized economic planning does not work.
Which leads to another ill from government contracting. Government is not accountable for profits, only performance. Imagine how easy life would be for the CEO of United Airlines if he only needed to report to the board that the airline had delivered passengers from Chicago to Moscow- damn the costs! That is essentially the situation the federal government as a private actor puts itself in when it gets into contracting. I would explain more but I am excited to wrote about the federal government's inherent legal advantages as a contractor.
As a sovereign, the federal government has the ability to compel performance. So if the party contracting with the feds is not delivering, the USG can simply order them to do so- never mind court costs. And there is certainly no worry about getting a court date- it is an internal action. But when United Airlines needs to litigate a contract dispute it is an expensive proposition, occasionally dropped out of fear of legal fees or a burdensome timeline. The feds do not care- time is never ending in the federal world (just look at how long it will take to pay down the national debt).
Furthermore, the federal government has the ability to make mistakes and walk away. Contracting officers for the feds are not permitted to enter into certain contracts. But guess what happens if they do anyway? The federal government can just walk. Who else is going to step in and complain?
So the federal government then, generally speaking, should not contract. It has been going on for ages though. Washington contracted with locals to provide food for his soldiers, Jefferson encouraged privateering, and it is a well-known fact that Lincoln outsourced White House IT operations to a Best Buy from Arlington (he was a Mac guy, but for seven years worked only with PCs).
It is tempting to say that the feds should refrain from acting as private actors in all but a few areas, and then list them (interpretation comes to mind- I can see where the Customs Service might need a Tagalog translator now and then- but as a full time employee? Maybe not). I have a better idea though. If the federal government could just be restricted to the twenty-two or so express areas that it has authority to act, then any contracting done would be limited, as would its wastefulness.
And cutting USG waste is what I am all about.
Sensible libertarian views on nearly everything- except foreign affairs.