The Costs of Privatization

For all those people who believe the private sector is always superior to government, keep this information in mind (from the Project on Government Oversight):

POGO’s review of DoD [Department of Defense] service contracting budget and spending data found that contractor employees cost 2.94 times more than an average DoD civilian employee performing the same job. In fact, although the number of employees in both workforces is relatively balanced, spending on the workforces is not: DoD service contracts cost $253.8 billion and DoD’s civilian workforce cost $72 billion (base) or $108 (base plus overhead) in FY 2010.

Just in this area alone, privatization of the military creates about $150 billion in annual additional spending -- or corporate payoffs, if that's how you want to think of it. And this is merely the civilian force.

Some reports suggest another $30 to $60 billion annually "lost to waste and fraud by military contractors." And then there's the issue of soldier versus private contractor pay -- for doing the same job:

Incredibly, while base pay for an American soldier hovers somewhere around $19,000 per year, contractors are reportedly pulling in between $150,000 - $250,000 per year.

This is all somewhat disheartening in the context of ongoing budget debates in the  U.S.


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