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by Yossarian_Lives 4798 days ago
For all the invisible handers, let's not forget the London olympics where certain security roles were contracted out. The company involved failed to recruit sufficient numbers of personnel by a significant margin, failed to train adequately those that they did and failed to communicate the scale of the failure that was developing. In the end, the government had to bring in the army to perform the role.

While there are undoubtedly areas where the public sector can learn from private sector efficiency, I'd venture that there are some societal functions where the point of profit maximisation results in an inferior and inadequate service. Or - to look at it a different way - the public sector is the only provider incentivised to realise the positive externalities of that service. This might be the public benefit of putting out fires regardless of a person's payment status (stopping them spreading), the cumulative benefit of going about business safe from crime, the benefits of a healthy workforce, etc etc.
2 comments
jiggy2011 4798 days ago
An invisible hander would probably say that the government should not have organised the olympics to begin with (effectively a monopoly).

Using tax money to put on an event of that scale where there was effectively only one organisation with the resources to provide security services is bound to make that one organisation optimize for cost saving.

If you had only private sporting events then security companies and event organizers would eventually optimize to a state of security that best served the expectations of their customers.

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katbyte 4798 days ago
sounds very much like security at the vancouver 2010 olympics and the G8/G10 summit. i worked as security doing airport screening of people (x-ray & mag) and oh boy i have plenty of stories. There was so much waste, gaming the contract/system so the government would pay for far more man hours of under qualified under trained workers. Like keeping 40 people on the clock when 5 would have been sufficient. Granted the police were not much better.

I had never worked security before, nor have I science.

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jacoblyles 4798 days ago
When you have profit maximizing contractors for an organization spending lots of Other People's Money, that creates all kinds of bad incentives.
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