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View Diary: Private contractors cost more than federal workers in 33 of 35 cases, study finds (140 comments)

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  •  There are some things that make sense to (6+ / 0-)

    contract. Contracting food service from a local area - were it to be a functional local area - could be one of them.

    Here's what I don't understand. They're saying that an army sergeant paid $190 per day in salary and benefits  has a true total cost that is comparable to the private contractor cost of $1,222.

    Why? What are these other costs - aside from pay AND benefits - that the private contractor is assuming that the government does not have to provide? So I looked and found the analysis, which includes:

    CBO included three types of costs in its analysis: military personnel costs, operating costs, and equipment costs. The military pay rates ($140 to $190 a day) correspond to cash pay (basic pay, subsistence and housing allowances, plus a federal tax advantage because those allowances are not taxed) but exclude noncash benefits, such as free health care for military families back home, and deferred benefits, such as pay and health care for those who receive military retirement benefits. Cash pay accounts for about half of total peacetime compensation for typical enlisted personnel.5 CBO therefore roughly doubled cash pay when estimating annual personnel costs for the Army to perform functions in Iraq and then added the costs of providing special pays to deployed soldiers.6

    The Army’s goal is to have two units at home station (that is, in the rotation base) for each unit deployed overseas.7 The time at home lets units recuperate from their deployment, reconstitute personnel and equipment, and train for their next deployment.8 The Army, however, has not been achieving its rotation goal. CBO previously estimated that the ratio of units at home station to units deployed was 1.2 as of April 2007 (just before the "surge" in U.S. forces in Iraq), and the ratio has averaged about that value as far back as 2004.9 To capture the costs of maintaining a rotation base for infantry units assigned to provide security in Iraq, CBO analyzed two cases: Case 1 adds the cost of 1.2 soldiers at home for each soldier deployed; Case 2 adds the cost of 2.0 soldiers at home. CBO included only peacetime costs for soldiers at home station, not wartime special pays.

    Operating costs would be paid out of the Army’s operations and maintenance (O&M) appropriation. CBO estimated O&M costs separately for the deployed unit and for the 1.2 or 2.0 units at home station. Finally, CBO assumed that equipment for the deployed unit, and its counterparts at home station, would have a useful life of 20 years. Thus, CBO amortized one-twentieth of the total equipment cost for a single year’s operations.10

    Seems to me that for the Army to get to that level of cost, it's providing a substantially higher quality service - with backup units back home, and units that are under its direct control that can be assigned and reassigned at any time. And does Blackwater truly provide all its own equipment, every bit?

    Fry, don't be a hero! It's not covered by our health plan!

    by elfling on Wed Sep 14, 2011 at 10:37:18 AM PDT

    [ Parent ]

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