Indiana doesn’t make the national news very often. But in many respects, it should. The administration of public services by elected officials in the state is something public employees nationwide should pay attention to.

Under Republican Gov. Mitch Daniels, President Bush’s Office of Management and Budget chief from 2001-2003, the state has become a political laboratory where experiments in the privatization of public services have flourished.

One such experiment, the privatization of the New Castle Correctional Facility, imploded in April.

Inmates rioted. More than one dozen people were injured, according to the Department of Correction (DOC). Two correctional officers were beaten.

The uprising, characterized as a “disturbance” by Gov. Daniels, didn’t surprise the Unity Team, a joint local of the AFT and the United Auto Workers.

When Gov. Daniels proposed privatization of the prison, the union held rallies in the town and met with city officials in an attempt to educate the public about the dangers of prison privatization.

Putting profit before safety

Private prisons are notorious for higher rates of inmate escapes, understaffing and unaccountability to the communities they operate in and around, compromising public safety.

New Castle, which is about 45 miles east of Indianapolis, is operated by the GEO Group, a Florida-based company.

Under a money-making deal brokered by the Daniels administration, more than 600 convicts from Arizona moved in starting in March. A little more than one month after arriving, the Arizona inmates incited the riot.

“This state has been up for sale for well over two years now,” says Ronnie Cox, a Unity Team vice president who is a correctional officer at Plainfield Correctional Facility.

To be certain, Daniels’ privatization agenda was the subject of a New York Times article in June, which noted that Daniels has been nicknamed “Gov. Privatize” by his critics.

How sweeping is his privatization agenda? In addition to New Castle prison, the New York Times mentions two other deals brokered by Daniels’ administration: contracting out eligibility determination for Food Stamps, Medicaid and Temporary Assistance for Needy Families to IBM; and leasing of the Indiana Toll Road to an Australian-Spanish consortium for 75 years.

But there are a host of other government jobs he’s handed over to the for-profit business world including food and janitorial services, tax collection and medical care (in the Department of Correction).

Government officials
and their so-called ‘Reason’

“The case for judicious private contracting rests, of course, not just on superior efficiency but also on grounds of sound philosophy: anything that strengthens the private sector vs. the state is protective of personal freedom,” Daniels wrote in the 2006 Annual Privatization Report, published by the Reason Foundation, a libertarian nonprofit policy organization.

Just as Grover Norquist’s Americans for Tax Reform has its “Friends of the Taxpayer”—lawmakers who have signed a no new tax pledge—the Reason Foundation has its “innovators.”

This year’s “Innovators in Action” include former New York City mayor Rudy Giuliani, former Colorado Gov. Bill Owens, Hamilton County (Ohio) commissioner R. Patrick DeWine and secretary of the Indiana Family and Social Services Administration E. Mitchell Roob Jr.

With the exception of Indiana’s Roob, all were elected to their respective offices. Here’s what a few of them they had to say:

• Giuliani: “The key to limited government and fiscal conservatism isn’t just cutting taxes. To energize an economy, government also has to control spending. That’s why I required all department and agency heads to present 5 percent to 10 percent cuts in their budgets every year. When an agency wanted money for a new project or program, I told them if they could find half the money by trimming their own budget or making the agency more efficient, then I would work with them to provide the other half of their request.”
• Owens: “To remain competitive in the global environment, governments will need to embrace the power and ability of the private sector....”
• Roob: “As a general rule, I have always operated from the theory that if you can open the yellow pages and find someone in the private sector doing a service that mirrors what the government is doing, chances are the private company is doing it at a much higher quality and a much lower cost.”

The unaccounted-for costs

Back in New Castle, Ind., public employees quelled the riot. The Indiana DOC had to activate its emergency squads from Pendleton and Plainfield. The Henry County Sheriff’s and Fire Departments also responded, as did the State Police and the Delaware County Sheriff’s SWAT, K-9 and Special Emergency Response Teams.

“If they were a DOC prison, they would have had trained [emergency] workers on site,” says Cox.

In addition to facility preparedness, there is the issue of money: Who is going to pay the bill for calling in all these law enforcement agencies?

In a “post-event analysis,” DOC said “too many unseasoned staff” with less than one year of correctional experience was a secondary factor that contributed to the riot.

What you can do

“Fight privatization as much as you can,” says Cox. “Support a candidate who knows the ill effects of privatization and how the exporting of tax dollars across state lines as well as the country has ill effects on your community.”

Moreover, Cox warns that the accountability rests with the government; and the liability stays with the taxpayers.

“In corrections, we have privatized our medical department. When something goes wrong, the state is looking at medical malpractice,” Cox says.

“Privatization has never been a plan to save money. That’s been the selling point but it doesn’t take the burden away from the taxpayer. If anything, it adds burden to taxpayers when people are ill trained.”