It is no secret that labor unions have tremendous pull with Democratic politicians in Sacramento, but that love affair went to new heights earlier this month when the Assembly passed a union-backed resolution calling for an end to the common practice of contracting out certain services to private-sector providers.
Assembly Resolution 29, sponsored by Assemblyman Jimmy Gomez, D-Los Angeles, asserts that “the Assembly opposes outsourcing of public services and assets, which harms transparency, accountability, shared prosperity and competition, and supports processes that give public service workers the opportunity to develop their own plan on how to deliver cost-effective, high-quality services.”
In fact, the resolution seeks to eliminate transparency, accountability and competition completely and rely for services instead on government monopolies.
The nonbinding measure also ominously declares that “the Assembly intends to introduce and advocate for responsible outsourcing legislation.”
Competition provides the impetus for providing goods and services at the highest quality and the lowest cost. It is precisely the lack of competition that has led to government inefficiency. How often have we heard public employee unions loudly complain about a contracting proposal, only to find that, when they are forced to compete with the private sector they discover they can do the job for much less. And in the rare case that you get a really bad contractor, you can fire him. Try doing that with a government agency.
To be sure, there are good and bad ways of doing contracting. Governments should use a transparent, competitive bidding process, utilize performance-based contracting — which spells out desired service levels and rewards contractors for exceeding goals and punishes them for poor performance — and maintain strong contract oversight.
Many of the things government does are clearly commercial in nature, and can be found in the Yellow Pages. It would be a grievous mistake to deny the benefits and successes of outsourcing and rely instead on monopolistic bureaucracies whose budgets are determined by political influence, rather than by economic conditions and how well they serve their customers.