Corporatization - NH Style

For decades, American workers have been hit hard by the outsourcing of jobs.  Through the use of free trade agreements, like NAFTA, the movement of products, services, and capital have been unrestricted by national borders, while increasingly stringent immigration laws ensure that labor has no such privilege.  Wealthy corporations have been able to move factories and jobs to the lowest bidder in our global economy,  exploiting low-wage workers in developing countries while continuing to sell their products at increased profit margins in the US.   This has resulted in stagnant wages for the 99% while executive pay and corporate profits skyrocket.   Now, American workers face a new enemy in the downward death spiral of wages and benefits – their government.


In March, The NH Executive Council moved to accept a corporatization contract for security at Pease Air Base.  Citing funding issues, the office of the Adjutant General presented a contract that neither saves money or improves performance.   Saving money should never be the ultimate measuring stick for providing for public safety or national security interests, but even here the Adjutant General’s position is untenable.  Coming in at nearly $1.2 million dollars, the contract is nearly $300,000 more than the cost for the same level of service provided by state employees, when comparing “apples to apples.”  

It is important to know that the corporation awarded the contract is not creating “security efficiencies.”  They are creating “cheaper security.”  The state employees who were providing security at the base have been doing so for over two decades.  They have provided exemplary service, have won awards, and have received praise for performance from General Riddel and his staff.  These hard working, loyal, and competent guards were eliminated from their positions because of their pay and benefits.  The state decided to outsource this critical work to a corporation who will profit by paying guards much less than state employees were making, with far fewer, if any, benefits.

The state employees were guilty of being in the middle class, with a job that paid a living wage and health benefits that insured them if they were to be injured or get sick.  The corporate guards will now be paid 30% less than the state employees with rolled back health coverage that has the added benefit of high premium contribution.  

Readers should be reminded that we are talking about federal funds.  The funding for security at Pease is through grants from the National Guard Bureau.  Adding insult to injury, NH receives only $0.71 back for every dollar sent to Washington D.C., so the limited return of federal tax dollars is now being used to build corporate profits while depressing worker wages.

The State of New Hampshire is now fully engaged in initiatives to corporatize state agencies.  Make no mistake, corporatization is simply domestic outsourcing.  While the jobs remain, they will be for less pay and fewer benefits with the excess payment from taxpayers lining the pockets of a corporation.  Good public service sector jobs are being eliminated to create a profit path for the 1%.  And while the new contracts seem like a good deal in the beginning, the cost savings rapidly evaporates once the state loses the capacity to take the work back from the contractor.  Private-sector contractors are subject to economic pressures that provide motivation for extra-economic activities that are not in the best interest of the public good.  From cost increases to add-ons, cutting corners to shoddy hiring practices, contractors have incentives for increasing the contract amount and decreasing deliverables at every opportunity.  When this cost escalates and performance suffers, and the state is left saddled with a budget busting contract that never delivers on the initial promise.

The question we need to raise and ask of our neighbors and friends is, Is the undermining of worker wages and benefits an appropriate role for our government?