Privatization Works for Social Services Too

One of the nation's best-kept secrets is really a heart-warming story of compassion and success: the increasing "privatization" of local social services.

In a recent study for the Heritage Foundation, author Stephen Moore tells the story. He writes, "Though mostly ignored by Washington, and overlooked by the press, today the private sector is spearheading an unprecedented number of community-based programs to combat hunger, homelessness, illiteracy welfare dependency, drug use, teen pregnancy and other pressing social welfare concerns."

Assistance provided by volunteers, churches, community groups, private charities and for-profit businesses is estimated to be valued in the tens of billions of dollars. And with few exceptions, the result has been considerably more bang for the buck than government programs get when they try to accomplish the same things.

Moore cites an amazing statistic: Cities are contracting with private organizations to provide human services, with about 55 percent of human-services spending now contracted out to private organizations. Examples abound of the private sector doing a superior job in such areas as treating alcohol and drug abuse, training welfare recipients for jobs, providing adoption services and managing public housing projects.

He quotes Marc Bendick of the Washington-based Urban Institute, who says, "Through their small scale, non-bureaucratic nature, local knowledge and personal relationships, neighborhoods, families, churches, and voluntary associations can respond rapidly, accurately and in a more acceptable manner to local and individual needs in ways that large formal institutions such as government agencies cannot.

In Huntsville, Ala., handicapped and elderly residents pooled their savings in the early 1980s to purchase vans from the city. They are now sharing the responsibility of providing cost-effective transportation services for themselves.

The Homeless Services Network of St. Louis, Mo., has received acclaim for its astounding success in sheltering the homeless. Private charities including the Salvation Army and the Red Cross, combined with support from 110 nonprofit community groups and churches and hundreds of volunteers, are handling the entire homeless problem in St. Louis. The network does much more than provide shelter: It supervises a full range of professional counseling, job training and rehabilitation, as well as locates permanent housing for each family and pays their rent for up to six months. Only one city employee is connected with the program.

In Minnesota, the county where Minneapolis is located has been remarkably innovative in the area of day care for children of low-income families. Its voucher program has minimized costs to the taxpayer, encouraged a 15 percent increase in the number of private day-care centers, reduced the average monthly cost of day care and made it possible for 15 percent more families to find acceptable day care. Many more low-income mothers wishing to work now are able to do so because of this market-based solution to what many think is a "public" problem.

The Moore study refers to numerous other examples of the privatization revolution in social services. Private, market alternatives to government programs are cutting the dropout rate in Chicago public schools, reducing the cost of the caseload in San Francisco's courts, instilling the pride and care of private ownership in formerly decrepit public housing in Washington, D.C., and St. Louis, keeping the elderly at home and out of institutions in St. Paul, treating and caring for abused children in Hamilton county, Tennessee, and cleaning up neighborhoods in Columbus, Ohio.

Concludes Moore, "Across the board, the most effective antidotes to the social welfare problems that are now commanding public attention...have been initiated by the private sector, not government." The tens of billions of dollars that some in the Congress are proposing the government spend on these things would likely be unnecessary, counterproductive and probably destructive of the healthy private initiatives now gaining ground.

America's strength, if not its most distinctive characteristic, has always been its private, voluntary sector. We get more accomplished here when the government is hardly involved at all than the world's socialist countries get with do-gooder government into everything. That's a message that deserves to be shouted from the rooftops.