I Never Would Have Guessed

Michael Froomkin (h/t Mark Thoma):

POGO Study: Contractors Costing Government Twice as Much as In-House Workforce. This looks like an important study. The results are sadly not incredible: if you look not at the wages employees receive in the contracted-out businesses, but rather the prices their employers charge the government for their services, contracting-out looks (sometimes very) expensive compared to using government workers.

The U.S. government’s increasing reliance on contractors to do work traditionally done by federal employees is fueled by the belief that private industry can deliver services at a lower cost than in-house staff.
But a first-of-its-kind study released today by the Project On Government Oversight (POGO) busts that myth by showing that using contractors to perform services actually increases costs to taxpayers.
POGO’s new report is the first to compare the rate that contractors bill the federal government to the salaries and benefits of comparable federal employees. The study found that while federal government salaries are higher than private sector salaries, contractor billing rates average 83 percent more than what it would cost to do the work in-house.

The study comes with some caveats, but at first glance it looks like a serious attempt to measure things that — oddly — are not routinely measured by the government that pays for all this stuff.

I'm just shocked, shocked I tell you, that privatizing work done by government workers would end up costing taxpayers more.  Who would have thought that corporate profits or higher executive pay might end up making the private sector more expensive than the public sector.  I mean, besides you and I.  What such privatization ends up doing is getting rid of well-paid government jobs and replacing them with lower-paid private work.  The difference goes to the rich guys who own the companies who get the contracts.  More income inequality doesn't seem like something we need right now, especially when it costs more than the status quo.