One way for governments and enterprises to save money is to contract out some or all of their services. Towns, cities, counties, states — even the federal government — engage in such practices all the time.
It is really just outsourcing, as business lingo dubs it.* But, like any system for shifting responsibility away from direct management, it can be corrupted.
As Seattle citizens now learn, courtesy of Seattle Times reporters Mike Carter and Steve Miletich.
It appears that Seattle City Light, the public utility providing electricity to the city, has been contracting exclusively with Seattle’s Finest Security & Traffic Control. For a half a decade. Despite there being direct competition from another firm.
The utility paid “more than $7.8 million over the past five years to provide off-duty police officers for traffic control or security work,” the Times tells us.
The whole story came to light (no pun intended) when a new outfit offering similar services, but based on “gig economy” principles, sought to enter the market. Seattle’s Finest challenged the firm’s licensing, and, allegedly, directed abuse at the firm’s chief executive officer.
A Seattle detective off-handedly described the dominance of Seattle’s Finest “in organized-crime terms — using the word ‘mafia’ — and said nobody would be allowed to interfere with it.”
The FBI has now been called in.
Usually, local government may seem rather humdrum. But a lot of money can go through powerful, privileged hands. Things can get exciting. Terms like “murky” and “intimidation” abound.
Is this a surprise?
Remember: power corrupts; local power corrupts locally.
Right there where we live.
This is Common Sense. I’m Paul Jacob.
* An economist, R. H. Coase, got a Nobel Prize in no small part for explaining why this sort of contract can work better than establishing a complete firm-employee wage system.