It is certainly true that the extensive and successful privatization experience in Ecorse, Michigan was the result of an extraordinary situation, namely, the bankruptcy of the city. Mr. Schimmel was given broad authority by the Court to implement what, in light of past practices in Ecorse, amounted to radical, emergency measures.

Some might argue that this circumstance diminishes the lessons to be learned, or at least limits the applicability of privatization (and other cost-reduction initiatives) to other municipalities. Those who make that argument, however, are missing the point.

Actually, the Ecorse experience underscores and strengthens the case for privatization and public sector cost-reduction.

A city or other governmental unit in financial trouble can employ these initiatives as the means to recover, while other governments headed toward trouble can avoid a calamity by putting them in place now. The fact that it took bankruptcy for privatization and cost reduction to occur in Ecorse is a testimony to poor fiscal stewardship; these things ought to be serious front-burner considerations for all governments at all times.

Furthermore, the Ecorse experience teaches that there is both a right way and a wrong way to privatize. Doing it right means carefully written contracts; aggressive efforts by local government to encourage many contractors to bid; open, competitive bidding; subjecting contracts to periodic renewal; and careful monitoring of contractor performance. When these ingredients are excluded, what passes for "privatization" is really nothing more than cozy deals between sloppy private providers with political connections and self-interested public officials and bureaucrats with little regard for their responsibility to the citizens.

From Detroit to Ironwood, Michigan municipalities must learn from both the mistakes of Ecorse and its inspiring renewal.

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