The money quote is from this guy…
John Donahue, who studies public sector reform at Harvard University’s Kennedy School of Government, said even the appearance of too-cozy contracting ties can taint a well-intentioned privatization effort.
“Contractual hygiene is pretty important,” said Donahue, formerly an assistant secretary of Labor in the Clinton administration. “People tend to be paranoid about conflicts of interest, and for good reason.”
Again, it’s like the old Trotskyist claiming that the Soviet Union wasn’t real communism without ever realizing that was as close as any group of human beings could ever get. Contractual Hygiene is not possible in privatization. It hasn’t been in any of the privatizations.
Yes, in theory, it should work perfectly except that the real world fucks all that up. Either the contracts get too muddled with a lot of clauses that aren’t at all to the advantage of the public entity or the the public entity, represented by someone who worked for the company who is bidding the contract or will soon work for them, makes a really lousy deal (an example of which easily sits at the feet of Indiana Governor Mitch Daniels who sold the Indiana Toll Road off at a discount of, by some estimates, $1 billion).
Unlike the experiment in Texas, which failed miserably, Indiana’s is beginning to work out though the result isn’t as good the previous program and the cost savings never really materialized. Which leads me to wonder what, other than create a new form of corporate welfare, privatization was designed to do?