Professors Avihay Dorfman and Alon Harel recently posted a new article on SSRN entitled The Case Against Privatization, which focuses primarily on the problem of private contractors carrying out violent acts or coercion at the government's behest (as part of their contract). This is a significant contribution to the literature in this area because of its sophisticated philosophical approach to the issue (rather than focusing on efficiency, manpower costs, or agency costs, which tend to dominate the academic literature and political debates about government outsourcing). Here is the abstract:
This article develops a non-instrumental argument against privatization of certain forms of political violence. Its primary foci are the privatization of prisons and the use of mercenaries in wars. The article maintains that some governmental decisions simply cannot be executed by private entities. While private individuals may act in conformity with the state's orders, such conformity cannot count as an execution of the order of the state and cannot be attributed to the state. Conformity that does not constitute an execution of the state's order, in turn, fails to realize the ends for the sake of which the infliction of force is justified, i.e., condemnation of the criminal behavior (in the case of punishment) and fighting for the polity’s public good (in the case of wars).
The article's focus on privatized prisons and military contractors is helpful for the sake of clarity; I think the arguments proposed could apply to other realms of government outsourcing that are inherently coercive (or very intrusive on individual's private lives or families) but not necessarily violent. Outsourced decisionmaking about child custody, certain welfare or healthcare benefits, and similar matters can have devastating consequences for individuals on the receiving end of a private actor's choices, in a context where both the government and the contractor can hide behind diluted responsibility and disrupted lines of duty. In any case, I highly recommend this article, and hope it informs the policy discussions about these matters in the future.