Cheap Does Not Equal Value: State Employees are a better value proposition than consultants

by Brian Leubitz [courtesy of Calitics - Front Page]

Somewhere along the line, the Grover Norquists of the world have convinced Americans that everything can be done better and cheaper outside of the frame of the government.  Unfortunately, that's really not so. Look at the numerous debacles with Public-Private Partnerships, and what do you see? Cost overruns, shoddy worksmanship, and a poor record on worker's rights. Now, that's not universally true, but it's about time these "collaborations" get more scrutiny than just the passing "ooooh, that sounds cheap!"  Thankfully, that was done recently, and let's just say, outsourcing doesn't always work out:

According to a 2006 report by the independent California Research Bureau, outsourcing IT work cost 50 percent more than doing the work in-house.

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California has struggled with IT strategy and oversight for more than a decade. In 2002, lawmakers shut down the state's technology office when they learned that Elias Cortez, director of the Department of Information Technology, had approved a $95 million contract with Oracle Corp. without competition.

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According to the SEIU report, costs are continuing to skyrocket. Since 2003, the number of IT contracts has risen from about 1,800 in 2003-04 to 5,500 in 2007-08.

The total value of personal service contracts has jumped from $28 million to $340 million in the first eight months of the current fiscal year. Meanwhile, the value of consultant contracts increased from $40 million to $120 million.

"It's costing the state tens, if not hundreds, of millions of dollars every year," said Daniel Rounds, a SEIU official who compiled the union study. (SacBee 3/12/08)

Just because something is cheap, my dear Arnold, doesn't mean it's a good value.