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Jon Shefner and Diana Moyer: Outsourcing state jobs will harm workers

If we look carefully at Gov. Bill Haslam’s yearlong plot to outsource 10,000 Tennessee workers’ jobs in higher education, state parks, prisons, hospital and armories, it becomes immediately clear that not only will outsourcing hurt working people, but that this process is proceeding with absolutely no transparency.

Outsourcing these state jobs will badly hurt Tennessee, already the state with the largest percentage of minimum-wage jobs in the nation. Researchers of privatization consistently find that outsourced jobs have lower pay, benefits and security. The requests for proposals just released for bids on this work make it clear that this is the only way multinational corporations can undercut costs. With privatization, not only does work quality decline, but the savings are usually not realized. Outsourcing estimates consistently hide additional costs to governments and taxpayers. One University of Tennessee official quoted in the Tennessean found that outsourcing would not cover services during athletic and other special events, and it would impose additional costs because projects such as recycling would not be covered.

Outsourcing also harms local small- and mid-sized suppliers of goods to government when they subsequently lose that business to large multinational corporations. One analysis suggests that this specific outsourcing plan will cost the state more than $284 million in lost wages and benefits, a loss of approximately 1,200 jobs, and an additional 4,000 higher-education workers experiencing reduced pay and benefits. This same analysis suggests that more than 900 workers will be affected at UTK alone. Documents also demonstrate that UT facilities workers are already performing important work for costs less than the estimated price to be paid by private services.

But we can’t really know how much UT and other state workers genuinely save in citizens’ money because of the dark cloud under which the outsourcing process has been conducted. In response to legislative and other requests for an audit, the Haslam administration hired a firm to do an “independent review” of the costs and benefits. Kraft CPA, the firm that was paid almost $82,000 to do the review, donated $4,500 to the Haslam gubernatorial campaigns of 2010 and 2014. Its executives directly donated an additional $16,000 to the governor’s campaigns. If this were not enough to cast great doubt on the independence of the review, Haslam appointed Kraft CPA executive Vic Alexander to a position on the State Board of Accountancy, which addresses ethics complaints. The result of this tale of the fox guarding the hen house was predictable – Kraft CPA, in its letter, found that outsourcing would save the state of Tennessee $35 million. The only trouble is there was not one detail in that audit about where the savings would come from.

This playing fast and loose with facts is consistent with the year-long-plus process. The governor has excluded the Legislature from decision-making about this important labor market change.

After the process was well underway, the Haslam administration rewrote the rules of the game, excluding university officials and giving the corporations more power in the negotiations.

Legislators across the state have spoken out against this plan, as have the workers who stand to lose so much. So, too, have those at universities and state parks who know that the services they enjoy from committed state workers will decline as private workers are paid less to do more. During the initial public comments period, the ratio of opposition to this plan was 410 to 1. The Haslam administration recently announced another period of open comments, without publicizing the earlier comments. Everything about this plan will hurt workers. It has been conducted out of public view and in bad faith. It is time to halt this process and save the jobs and security of thousands of Tennessee workers.

Jon Shefner is a professor of sociology at the University of Tennessee in Knoxville and a longtime member of United Campus Workers. Diana Moyer is president of United Campus Workers at UTK.

Article source: http://www.knoxnews.com/story/opinion/columnists/2017/02/26/jon-shefner-and-diana-moyer-outsourcing-state-jobs-harm-workers/98250780/

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