The Privatization of America

Daniel Guttman and Barry Willner wrote The Shadow Government in 1976. The authors warned that the government was embarked on a “multi-billion-dollar giveaway” of decision-making authority. Ddecision-making authority as well as actual services were being outsourced to high-priced consultants, secretive think tanks, and corporate vested interests — accountable to no one! Using a process’ cloaked in contractual and other formal approvals by the various executive departments a drive to merge government and business interests to the advantage of the latter had been initiated starting as early as 1969.

“In 1969, president Richard Nixon appointed Donald Rumsfeld, a 37-year-old congressman from Illinois, to head the Office of Economic Opportunity, which was responsible for overseeing the War on Poverty.

Richard Nixon wanted the agency restructured, and Donald Rumsfeld, with the assistance of his chief aide, Dick Cheney, quickly began bringing in management contractors to do the work of the agency’s top civil servants.

Daniel Guttman and Barry Willner quote Dick Cheney as saying, “Don found himself with a bureaucracy that hated him…. [He] was forced to seek outside help. I remember Don reciting to me the Al Smith statement, ‘If I don’t look to my friends for help, who do I look to, my enemies?’”

Donald Rumsfeld’s successor at the agency was Frank Carlucci, who later became Ronald Reagan’s Defense secretary. In 1971, Frank Carlucci told Congress that he was dramatically curtailing the agency’s spending on management contractors. “We did not think we were getting our money’s worth,” Frank Carlucci testified.

In the 1980s, Ronald Reagan created a presidential commission on privatization to study how the boundary between public and private might be erased giving private interests more opportunity to move into traditionally government roles.

The same idea surfaces in the “re-inventing government” movement taken up by the Bill Clinton administration: “We would do well,” one proponent wrote, “to glory in the blurring of public and private and not keep trying to draw a disappearing line in the water.”

Since then privatization has affected every aspect of American public life.