What is the difference between “public” and “private”? And more importantly, why does it matter?
What is the difference between “public” and “private”? And more importantly, why does it matter?
By “public,” I am referring to the public sector, to action taken by a unit of government. The Bill of Rights restrains only government, so it is important to know whether a particular act was public (i.e. governmental) or private. Government cannot insist upon random drug testing of its employees, for example, although a private employer may legally do so. Public schools cannot insist that students pray, but private schools can. Government cannot ban books, discriminate against women or Wiccans, or deny citizens due process of law. Under certain circumstances, private organizations can do all of those things. The distinction between public and private is absolutely central to American constitutional law and the idea of limited government.
It is also a distinction that is becoming increasingly blurred.
When Margaret Thatcher “privatized” elements of the British economy, the term was descriptive. Once a determination had been made that a particular function ought not be governmental, the enterprise involved was sold off—lock, stock and barrel—to private owners. Government would have no further authority to run it; it would pay taxes and compete in the marketplace just like any other privately-owned company.
The United States never had a large sector of government-owned business, and the term privatization has accordingly meant something quite different here. In the U.S., “privatization” usually refers to the practice of “contracting out,” the employment of private companies to do government’s work. The government still calls the shots: it determines what goods or services shall be provided, how they shall be provided and to whom, and it pays for them with taxpayer dollars. Contracting out may be more efficient or cost-effective, but it does not make government smaller or less intrusive. Rather, it makes bigger government less visible, and may make it less accountable.
Contracting out can make it difficult to distinguish private from public activity. On the one hand, if a city buys computers or pencils from a private company, that vendor shouldn’t suddenly be considered part of the public sector. But what happens when the city or state engages a private company to deliver services that had previously been delivered by government employees? Can the private company engage in practices that would be unconstitutional if the government did them? The case law to date suggests that the answer to this question is yes, and that is a very troubling conclusion.
As the election season heats up, candidates for office—including both parties’ Presidential candidates—are falling over each other advocating the delivery of social services through not-for-profit and faith-based organizations. If any of them has alluded to these issues of constitutional and political accountability, I haven’t seen it.
As Donald Kettl recently wrote in Governing Magazine, we are not shrinking the public sector. Instead, we are governmentalizing the private sector. We need to consider very carefully whether that is a result we really want.