Its all about greed and power and the Republican fixation on the 16th century.
Two references to our favorite PMC (and to PMC's in general) were in the news this week. Paul Krugman reminds us in the first piece that the model of profiteering the Bushies are using is not new, but quite old, as in the 16th century. The second piece from Corporate Watch demonstrates the new wrinkle the bushies have added. The no bid contractors don't do the dirty stuff themselves, like Georgie, they too farm it out. Why? Deniability. Like Capt. Renault in Casablanca , Bush can claim to be shocked, shocked at the evil deeds done by the subcontractors. So can the parent companies.
LINK Tax Farmers, Mercenaries and Viceroys, by Paul Krugman, A Monarchy Commentary, NY Times: Yesterday The New York Times reported that the Internal Revenue Service would outsource collection of unpaid back taxes to private debt collectors, who would receive a share of the proceeds.
It's an awful idea. Privatizing tax collection will cost far more than hiring additional I.R.S. agents, raise less revenue and pose obvious risks of abuse. But what's really amazing is the extent to which this plan is a retreat from modern principles of government. I used to say that conservatives want to take us back to the 1920's, but the Bush administration seemingly wants to go back to the 16th century.
And privatized tax collection is only part of the great march backward. In the bad old days, ...[t]here was no bureaucracy to collect taxes, so the king subcontracted the job to private "tax farmers," who often engaged in extortion. There was no regular army, so the king hired mercenaries, who tended to wander off and pillage the nearest village. There was no regular system of administration, so the king assigned the task to favored courtiers, who tended to be corrupt, incompetent or both.
Modern governments solved these problems by creating a professional revenue department to collect taxes, a professional officer corps to enforce military discipline, and a professional civil service. But President Bush apparently doesn't like these innovations, preferring to govern as if he were King Louis XII.
So the tax farmers are coming back, and the mercenaries already have. There are about 20,000 armed "security contractors" in Iraq, and they have been assigned critical tasks, from guarding top officials to training the Iraqi Army.
To whom are such contractors accountable? Last week a judge threw out a jury's $10 million verdict against Custer Battles, ... a symbol of the mix of cronyism, corruption and sheer amateurishness that doomed the Iraq adventure -- and the judge didn't challenge the jury's finding that the company engaged in blatant fraud.
But he ruled that the civil fraud suit ... lacked a legal basis, because ... the Coalition Provisional Authority ... wasn't "an instrumentality of the U.S. government." It wasn't created by an act of Congress; it wasn't a branch of ... any ... established agency.
So what was it? Any premodern monarch would have recognized the arrangement: in effect, the authority was a personal fief run by a viceroy answering only to the ruler. And since the fief operated outside all the usual rules of government, the viceroy was free to hire a staff of political loyalists lacking any relevant qualifications for their jobs, and to hand out duffel bags filled with $100 bills to contractors with the right connections.
Let us reflect on Krugman's insights here. At least the Bushies are consistent. Those who have should be allowed the perks of their status. Rich frat boys should be allowed to govern like potenates of old, without being questioned or held accountable. That is what being a rich frat rat means, never having to say you are sorry or even to explain yourself to the peons.
Leo Strauss , the godfather of the Neo-Cons would understand. The elite and enlightended ones who govern us cannot be accountable to the benighted masses or their minions, they are not wise enough to know what is good for them.
Unless these ideologues are stopped, we will end up with innumerable private corporations exercising enormous power over American citizens, especially the most vulnerable, but immune to the reach of our laws and legislators, safe behind a wall of "subcontractors."
Workers already have experienced the gut wrenching impact of this "outsourcing". They fire you as an employee and bring you back as a temp or contract worker at lower wages and no benefits. Sounds like a modern variation of peonage to me.
LINK "What we found is that rampant disaster profiteering abuses are needlessly slowing down the reconstruction of New Orleans and the rest of the stricken Gulf Coast region after Katrina," CorpWatch director Pratap Chatterjee told reporters. Chatterjee, who is author of the book Iraq Inc. about contractor abuses in halfway around the world, compared the situation along the Gulf Coast to that of the Middle East.
According to the report, the clearest instances of waste in Gulf Coast reconstruction are the contracting pyramids schemes - layers of subcontracting that turn an easy profit for the many middlemen. This layering creates distance between corporations such as Halliburton subsidiary Kellogg, Brown & Root (KBR) and the subcontractor that ultimately performs the work. It allows KBR, for example, to plead ignorance when labor abuses are uncovered, as happened when a subcontractor was caught employing undocumented immigrants late last year and accused of mistreating them.
Note the list of abusers. Blackwater's use of "subcontracts" is simply their adoption of the ever more popular corporate model. The scheme is of a piece utility privitization. Create a middle man, rip off the government or consumer, hire a cheap subcontractor to actually do the job and do it badly. Blame the subcontractor for all problems, and stick them with legal liability as well.
My brother works for a public utility entity in my home town. He recently told me the story of how it works in his field. His company by law must put out bids for designing a certain kind of public infrastructure ( say a monitoring station for water or such) . The lowest bidder gets the job of creating the design. My brother must then build the infrastructure to these specs.
Here is the kicker, their in house engineers must go over the specs and give their final approval. In some cases, these house engineer literally must redo the specs , and still pay the contractor for their lousy work. My brother's company cannot keep engineers. They are so overworked and so underappreciated they won't stay. My brother knows if something goes wrong he will be blamed , since he must install the project and is "the last line of defense" against faulty plans.
No reason is given for the inability to go back at the private firm who designed the faulty specs. I think I can guess one. Clearly somebody is making money off of the public and have the pull to NOT be held accountable. Cronyism, American 21st century style!!