ule No. 1: Always have a cover
story. The ostensible purpose of the Bush administration's
plan to open up 850,000 federal jobs to private competition is
to promote efficiency. Competitive vigor, we're told, will end
bureaucratic sloth; costs will go down, and everyone — except
for a handful of overpaid union members — will be better off.
And who knows? Here and there the reform may actually save
a few dollars. But I doubt that there's a single politician or
journalist in Washington who believes that privatizing much of
the federal government — a step that the administration says
it can take without any new legislation — is really motivated
by a desire to reduce costs.
After all, there's a lot of experience with privatization
by governments at all levels — state, federal, and local; that
record doesn't support extravagant claims about improved
efficiency. Sometimes there are significant cost reductions,
but all too often the promised savings turn out to be a
mirage. In particular, it's common for private contractors to
bid low to get the business, then push their prices up once
the government work force has been disbanded. Projections of a
20 or 30 percent cost saving across the board are silly — and
one suspects that the officials making those projections know
that.
So what's this about?
First, it's about providing political cover. In the face of
budget deficits as far as the eye can see, the administration
— determined to expand, not reconsider the program of tax cuts
it initially justified with projections of huge surpluses —
must make a show of cutting spending. Yet what can it cut? The
great bulk of public spending is either for essential services
like defense and the justice system, or for middle-class
entitlements like Social Security and Medicare that the
administration doesn't dare attack openly.
Privatizing federal jobs is a perfect answer to this
dilemma. It's not a real answer — the pay of those threatened
employees is only about 2 percent of the federal budget, so
efficiency gains from privatization, even if they happen, will
make almost no dent in overall spending. For a few years,
however, talk of privatization will give the impression that
the administration is doing something about the deficit.
But distracting the public from the reality of deficits is,
we can be sure, just an incidental payoff. So, too, is the
fact that privatization is a way to break one of the last
remaining strongholds of union power. Karl Rove is after much
bigger game.
A few months ago Mr. Rove compared his boss to Andrew
Jackson. As some of us noted at the time, one of Jackson's key
legacies was the "spoils system," under which federal jobs
were reserved for political supporters. The federal civil
service, with its careful protection of workers from political
pressure, was created specifically to bring the spoils system
to an end; but now the administration has found a way around
those constraints.
We don't have to speculate about what will follow, because
Jeb Bush has already blazed the trail. Florida's governor has
been an aggressive privatizer, and as The Miami Herald put it
after a careful study of state records, "his bold experiment
has been a success — at least for him and the Republican
Party, records show. The policy has spawned a network of
contractors who have given him, other Republican politicians
and the Florida G.O.P. millions of dollars in campaign
donations."
What's interesting about this network of contractors isn't
just the way that big contributions are linked to big
contracts; it's the end of the traditional practice in which
businesses hedge their bets by giving to both parties. The big
winners in Mr. Bush's Florida are companies that give little
or nothing to Democrats. Strange, isn't it? It's as if firms
seeking business with the state of Florida are subject to a
loyalty test.
So am I saying that we are going back to the days of Boss
Tweed and Mark Hanna? Gosh, no — those guys were pikers.
One-party control of today's government offers opportunities
to reward friends and punish enemies that the old machine
politicians never dreamed of.
How far can the new spoils system be pushed? To what extent
will it be used to lock in a permanent political advantage for
the ruling party? Stay tuned; I'm sure we'll soon find out.