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Outsourcing Sovereignty: Why Privatization of Government Functions Threatens Democracy and What We Can Do about It ReviewIn this fascinating book, Paul Verkuil, Professor of Law at Cardozo Law School, Yeshiva University, examines the USA's shift from public government to private governance. Outsourcing rose by 86% between 2000 and 2005 and the value of non-competitive contracts rose by 115%, mainly due to the war on Iraq.He examines the public/private distinction, constitutional governance, the limits of delegation, contract theory, and structural reforms. He uses constitutional, statutory, administrative and contractual sources and work in delegation theory and transactions cost analysis.
Under the US Constitution, the people is the sovereign power, delegating its powers to the three branches of the state, executive, legislature and judiciary, which are supposed to be agents of the people. But delegating sovereign powers to private hands undermines the state's capacity to govern. Outsourcing political decisions threatens the democratic principle of accountability.
Verkuil looks at the private military, private disaster relief, private border control, private prisons and private police. He argues that the planning and execution of responses to disasters are core government duties. He notes that after 9/11, Congress voted to `deprivatise' airport security, over Bush's opposition. Private security firms had treated security as a cost-control item, forcing down the quality of services. He notes, "In Europe, the preference for public sector solutions has been trumped by a higher principle congenial both to community integration and the world of privatization." Why higher?
Privatisation does not improve performance: research shows that professional civil servants manage better than political appointees, but then better performance is only the politicians' claim, not privatisation's real aim. Its real aim is to maximise profit - which Verkuil manages not to see, writing, "Outsourcing in the face of both accountability and efficiency objections is inexplicable."
He concludes that the use of contractors to displace functions normally performed by government officials is a danger to democracy, and so should be curtailed. We need to secure and preserve public values and oppose the current unprecedented delegation of powers to private firms.
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