School of Public Policy, George Mason University
Volume 3, Issue 7 : September 27, 2004 Public Policy Currents

Professor Publishes Commentaries about Problematic Trend in Governance

In two recent publications, Associate Professor of Public Policy Janine Wedel warns that the outsourcing crucial government functions to private individuals and companies is an alarming trend.

In the commentaries, one published in the Aug. 11 issue of Financial Times and another in the Aug. 12 issue of Salon, she uses a recent U.S. Federal Court ruling to underscore the dangers of contracting out government functions. The case involves two contractors, Andrei Shleifer, a noted Harvard economics professor, and Jonathan Hay, a legal advisor, who managed a U.S.-funded flagship project to reform Russia’s economy in the 1990s.

“Hay and Shleifer were supposed to be providing impartial advice to the Russians, but while doing so they were also making personal investments with the benefit of insider knowledge,” she wrote in Salon.

Wedel, a social anthropologist who has studied informal systems, networks and governance over several decades, was working in Eastern Europe when she brought attention to the contractors by writing about how their “network”  gained  influence  in  the  mid  90s.  (Her latest

 
Janine Wedel
Janine Wedel’s latest book, “Collision and Collusion: The Strange Case of Western Aid to Eastern Europe,” won the Grawemeyer Award for Ideas Improving World Order.
book, “Collision and Collusion: The Strange Case of Western Aid to Eastern Europe,” won the Grawemeyer Award for Ideas Improving World Order.)

Ultimately the court charged both Harvard and the duo with conspiring to defraud the government. The case reveals how U.S. reliance on contractors to make policy can damage relationships with foreign nations and undermine policy goals, according to Wedel.

The current U.S. government is making the same mistake, she claims in the articles. “Yet, a decade later, outsourcing of government functions has accelerated, driven by the Bush administration’s ideological preference for markets and, paradoxically, by the increasing demand for U.S. government services – namely military, foreign aid and nation-building activities,” she writes in Financial Times. Supported by the administration’s current strategy, government contractors have sometimes made crucial policy decisions in Iraq, she adds.

In the Salon piece, she blames some of the problems on a specific group: “The practices that led to the Boston ruling are not an aberration. In fact, a group that operates today in ways similar to the Harvard partners in Russia is receiving much attention. This is the small, tightknit group of neoconservatives whose strategizing and lobbying helped thrust the United States into the war in Iraq.”

Wedel has published her analysis and commentaries in many newspapers and magazines, including the New York Times, Wall Street Journal, Los Angeles Times, Boston Globe, The Nation and The National Interest.

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