Outsourcing the City: The Case of Maywood City Council

by Binoy Kampmark Binoy Kampmark was a Commonwealth Scholar at Selwyn College, Cambridge. He lectures at RMIT University, Melbourne. Email: 15.10.2010

Imagine a world where every service is no longer a matter of government but one of private contract. A classic model of monetarist, contracted efficiency where resources are neatly allocated and obligations to the 'public' discharged without fuss. To hell with government, officialdom steeped in the civil service culture. Welcome, then to the market alternative, from sewerage to warfare.

Such visions are not too far off from being realised, even if the neo-liberal economists have taken a battering of late. The United States army is heavily engaged in contracting security services using mercenary forces with as much knowledge of the laws of war as they have about the rulebook of peace. City councils, precisely because financial prudence is not exactly a forte, have decided to go much the same way. Maywood, a city of 28,000 residents located some 8 miles south of Los Angeles, is now in the depths of a strategy that might well seep into the entire fabric of government management.

The blue collar signatures of the city are there: deprivation, gang-violence, poverty. Traditional industries have declined since the 1920s. Hispanic migrants have come to dominate and have made the unofficial population figure much higher. So, in June, the local council voted to contract out its entire public service network. From the police department to the shuffling of books in the public library - all of these are now the stuff of private contract and concern. Mass sackings have been implemented.

In some instances, there is little reason to mourn the losses. A civil service should at least be able to count its servants as civil, and the police department has proven to be particularly notorious in protecting the city's residents. Its distinguished record featured no less than the settlement of 30 misconduct charges in five years, a smorgasbord of allegations ranging from civil offences to rape. The insurance providers were so galled they cancelled the public liability coverage. Enter then, the magical market, the road to a capitalist Damascus.

There is only one problem with this vision. Financial prudence is not guaranteed through the contracting service. Services that are relocated to the private sector may be, for periods, better accomplish the aims of the council and prove cheaper, but there is more than enough evidence suggesting that this is often not the case. Cock-ups happen, sometimes spectacularly. For one thing, the hand of capitalism can prove an overwhelming incentive for unvarnished greed.

As Councilman Felipe Aguirre and his colleagues found out, contracts to manage municipal services entered into with the neighbouring Bell contractors has not been one of financial salvation. The city manager of Bell, Robert Rizzo, cost $800,000 a year. The head of police netted $400,000. That made them some of the highest paid public officials in the United States. Naturally, this begs the question as to whether the entire Maywood City council should itself be outsourced, given its paltry judgment on the case.

While the sky, to use s reference to a piece in the New York Times (Jul 19), might not fall down when services are so contracted, it might well simply darken. Risk and inefficiency is not eliminated, merely postponed. And the idea of a government of the people for the people is nicely eliminated under the fictional slogan of market efficiency.

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