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Column: Edward Snowden and the disaster of privatization

NSA whistleblower Edward Snowden, an analyst with a U.S. defence contractor, is seen in this still image taken from video during an intervie
NSA whistleblower Edward Snowden, an analyst with a U.S. defence contractor, is seen in this still image taken from video during an intervie

(Donald Cohen is a Reuters columnist but his opinions are his own.)

By Donald Cohen

(Reuters) - In May, computer analyst Edward Snowden flew to China, handed over volumes of National Security Agency surveillance data to a reporter, and launched a heated national conversation about our nation's surveillance state. Underscoring that conversation was the fact that Snowden was a private contractor, given access to a vast store of information despite having virtually no track record with the NSA or the private firm with which he was employed.

Snowden's leaks exposed a widespread lack of oversight of the contractors working at every level of our government. Outsourcing can be nearly as damaging at the state and local levels as it is for federal contracts. The same lack of transparency, accountability and oversight threatening our national security threatens public services provided each day across the country. Cash-strapped mayors and governors are handing over control of critical public services and assets to for-profit corporations and Wall Street investment banks that promise to handle them better, faster and cheaper. Too often, such deals entirely undermine transparency, accountability, shared prosperity and competition, the very underpinnings of democracy.

In fact, the fine print in these outsourcing deals often gives corporations the power to make public decisions for decades to come. It also often guarantees profits even when getting them conflicts with what was a bedrock value of America: public service provided for the public good.

In Chicago, a Morgan Stanley-backed consortium took control of 36,000 public parking meters in a 75-year lease. Taxpayers must reimburse the private company when spaces are closed for street fairs or emergency weather conditions. The contract also prohibits the city from operating or permitting operation of a competing public parking facility. Even more outrageous, the city cannot make improvements to streets that contain parking meters, such as adding bicycle lanes or expanding the sidewalk.

In Denver, the private, foreign consortium that operates the Northwest Parkway can prevent any public road improvements near their toll road because they "might hurt the parkway financially" by providing an alternative route for drivers. Taxpayers are stuck with that contract for 99 years.

In 2012, Corrections Corporation of America (CCA), the largest private prison company in the country, sent a letter to 48 states offering to buy public prisons in exchange for a promise to keep the prisons 90 percent filled for 20 years.

While the letter was a public relations fiasco for CCA, it turns out that many existing private prison contracts actually include "occupancy guarantees" of 90 percent and even 100 percent. Governments must keep prison beds filled or taxpayers have to pay the prison company for empty beds.

Preventing horror stories like the above is precisely why my organization, In the Public Interest, developed the Taxpayer Empowerment Agenda which is a series of state and local proposals to restore transparency, accountability, shared prosperity and competition.

These common sense reforms are as basic as requiring any company paid with tax dollars to open its books and meetings to the public, just as public agencies do. They require companies that receive public contracts to pay a living wage with reasonable benefits, and they bann language that promises profits even if public services are no longer needed.

These reforms couldn't come fast enough. As veteran newsman Ted Koppel recently said on National Public Radio, "We are privatizing ourselves into one disaster after another. We've privatized a lot of what our military is doing. We've privatized a lot of what our intelligence agencies are doing. We've privatized our very prison system in many parts of the country. We're privatizing the health system within those prisons. And it's not working well."

Indeed, whether it's outsourced security or schools, it's not working well at all. And it's time for taxpayers to reclaim control.

(Donald Cohen is the Executive Director of In the Public Interest, a comprehensive resource center on outsourcing and responsible contracting.)

(Donald Cohen)

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