Report flags executive wages for government contractors

Jazelle Hunt | 3/14/2014, 6 a.m.

These companies also tend to offer their employees lower wages and fewer benefits, compared to public workers doing the same job. Often, municipalities sign contracts with these companies that either do not make provisions for existing public workers, or make arrangements that result in layoffs and/or pay cuts.

According to the Bureau of Labor Statistics, 15 percent of the nation’s 6.7 million public administration workers are black.

Most municipalities use some level of public-private collaboration to carry out public services; common examples of privatized public services include electricity, gas and health care. Property, sales and state income taxes pay for these services, and when a private company is hired to provide them, that private company is paid with tax funds.

The report also addresses the risks of privatization without careful planning, oversight or accountability.

In addition to disclosing the dollar amounts, the report highlights the companies’ relevant shareholder lawsuits, criminal investigations, U.S. Securities and Exchange Commission sanctions, and court settlements. Each firm headed by these top six earners has been sued, or investigated and penalized in the recent past, for harmful business practices and/or federal crimes in relation to providing public services.

The report is part of a larger project called “Outsourcing America Exposed,” which aims to raise awareness about public service privatization, and how it “hinders transparency and shortchanges taxpayers.”

“Business is in business to make a profit; there is nothing inherently wrong with that,” says Shar Habibi, the research and policy director at In The Public Interest, a research organization focused on privatization, and one of Center for Media Democracy’s partners in this project. “But not when that profit comes at the expense of public health and safety. Not when taxpayers suddenly realize they no longer have control over their own schools, roads, or water systems. And not when the heads of these corporations make salaries that are literally 200 times what a dedicated public service worker makes.”

New American Media