This lecture discusses the privatization of core government functions, focusing on the military and prisons, and the challenges associated with it. The lecture begins by revisiting the post-Cold War neoliberal drive to shrink government and aggressively outsource government work, leading to a significant increase in contracted workers, particularly within the military.
The lecture then delves into the privatization of the military. It notes that private contractors have been involved in warfare throughout US history. The speaker highlights the unprecedented reliance on private military contractors in the Iraq and Afghanistan wars. These contractors perform various functions, from security and intelligence to logistics and training. Some of the major companies are mentioned, with Blackwater (now Academy) being a notable example due to its controversial actions and the subsequent development of ethical guidelines like the Montreux Document.
The case study of "host nation trucking" in Afghanistan illustrates the complex realities of military privatization. The reliance on local contractors to guard convoys carrying supplies was driven by the desire to limit American casualties and reduce the political cost of the war. However, the lack of a strong, legitimate government in Afghanistan meant these contractors often colluded with insurgents, essentially funding the enemy by paying for safe passage. This raises ethical and strategic questions. The speaker prompts discussion on whether it is justifiable to fight wars in this manner, particularly if it enables unpopular conflicts to continue without broad public support and democratic oversight.
The discussion shifts to the privatization of prisons. The US is a global outlier in incarceration rates, driven by the War on Drugs and mandatory sentencing policies, despite decreasing violent crime rates. Ironically, factors such as the de-institutionalization of mental health patients contributed. Although the private prison industry only accounts for roughly 10% of all prisons, it’s a significant and growing sector, controlled by duopoly. These companies have proven profitable, particularly during economic downturns, incentivizing incarceration.
The speaker raises several ethical concerns. Private prisons are seen as benefiting from, and potentially lobbying for, stricter laws and higher incarceration rates. The core argument is that privatizing prisons represents a contracting out of a government monopoly, creating what economists call "principal-agent problems." This problem arises from a series of nested relationships involving a lack of competition, diverging incentives, and difficulties in monitoring. Core state functions such as monopolizing the use of force becomes problematic when contracting it out. The speaker concludes by emphasizing the challenges of aligning incentives between the government and private actors in these core functions, highlighting that such contracts are inherently difficult to monitor and are vulnerable to waste, fraud, and unethical behavior.