When Government Downsizing, They Often Contract with Private Companies to Perform What Was Once Considered to Be the Traditional Work of Government...

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As governments downsize, they often contract with private companies to perform what was once considered to be the traditional work of government. What are the advantages and disadvantages of privatizing jails, public schools, military plane maintenance, and state welfare agencies, and state employment agencies?

When government contract with private companies to perform what was once considered to be the traditional work of government, it is termed as privatisation. Privatisation is occurring at a rather impressive speed in United States. For example, there are over 100 privatised prisons in the country (Kissane, 2007). Other forms of privatisation occurring in United States include privatisation of schools, military plane maintenance, state welfare and employment agencies and hospitals. Privatisation has become a very controversial topic in the country due to its wide range of advantages and disadvantages.

In terms of advantages, privatisation of services such as jails and public schools will help to reduce the economic burden on the government. This allows the government to have more funds to devote to other goals such as to lower inequality or providing access to education. Furthermore, the government of United States have always been known for its budget deficit. As such, privatisation can help to reduce this budget deficit and also prevent overcrowding effect from occurring when government borrows funds to sustain what was seen as traditional work such as maintaining prisons and employment agencies. Next, another advantage of privatization will be the improvement in quality of service due to increase in competition. Privatisation will increase number of firms in the industry. As a result, competition will force these firms to increase efficiency and quality of work and this can benefit the public who are able to enjoy services of better quality at lower prices.

In terms of disadvantages, privatisation of traditional work of...
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