1. PIA 2528 Governance, Local Government and Civil Society

2. Reminder- Paper Requirements Individual research paper and Panel Presentation - 30% of Grade; Basis of Paper- Individual Work Plans but may be supplemented by other reading Next week- Be able to present and turn in a 1-2 paragraph paper proposal

3. Privatization and Contracting Out A Survey of the Literature- Continued (Review and Reminder)

4. Governance, Local Government and Civil Society Mega Themes:  THE ROLE OF INTERNATIONAL DONORS  PRIVATIZATION AND CONTRACTING OUT  NEGATIVE IMPACT ON CIVIL SOCIETY

5. Local Government and Civil Society: THE PROBLEM Review of Systems Factors  Models of Social Services Systems:  The Context of Privatization and Contracting

6. Overview: New Public Management Principles-  Focus on Service Delivery  Privatization  Contracting Out

7. New Public Management Principles- Continued  Subsidiarity  Anti-Corruption Measures  Re-inventing Government

8. Definitions  Privatization- The Private Provision of Services  Contracting Out- The Means of Delivery

9. Literature  Madsen Pirie, Dismantling the State: The Theory and Practice of Privatization (Dallas, TX: National Center for Policy Analysis, 1986).  E.S. Savas, Privatization: The Key to Better Government (Chatham, NJ: Chatham House, 1987).

10. Literature  Gabriel Roth, The Private Provision of Public Services in Developing Countries (Washington, D.C.: World Bank and Oxford University Press, 1987).

11. Private Provision—Contracting Choices: Gabriel Roth  Private Sector Controversies Indigenous vs. Foreign (or Pariah)  Contracting vs. Grants Sub-contracting and sub-grants: Blurring the lines  Making the Choice

12. Private Provision—Contracting Choices- Continued  Contracting and Non-profits Issues of privilege and subsidies  Debates about transaction costs and profits  Cost recovery vs. subsidies

13. Reasons Given for Privatization a. High Production costs b. Low levels of efficiency c. Featherbedded labor costs d. Pork Barrel Capital Allocations (The Bridge to Nowhere)

14. Reasons Given for Privatization-2 e. Low level consumer input f. Poor Maintenance and loss of service g. Inability of political leaders to impose cost control h. Free Riders Problem

15. Criticism of Privatization a. Private sector and NGOs are not necessarily more effective and efficient than government agencies (Paul Nelson) b. Loss of Coverage for social services (Rule of Structural Adjustment)

16. Criticisms of Privatization c. Can replicate private sector within government (This is the core of Reinventing Government argument-Osborne and Gabler) d. Need to deal with Corruption

17. Coffee Break  Fifteen Minutes

18. Literature  Robert Klitgaard, Controlling Corruption (Berkeley: University of California Press, 1988).  David Osborne and Ted Gaebler, Reinventing Government: How the Entrepreneurial Spirit is Transforming the Public Sector (New York: Plume Books, 1992).

19. Reinventing Government: David Osborne and Ted Gaebler 1. Steering Rather Than Rowing (limited contracting)- Weberian Bureaucracy: Bankrupt? 2. Customer Driven Government 3. Competition within Government and between units and Entrepreneurial Government

20. Reinventing Government, Cont. 4. Earning as well as spending--charging fees and selling goods and services 5. Key is decentralization not privatization 6. Third sector vs. Private sector Use of Non-governmental organizations rather than Privatization

21. Reinventing Government: David Osborne and Ted Gaebler, Cont. 7. Community Based Government Subsidiarity 8. People as citizens or consumers Is there a difference? TQM—add on to consumers 9. Government agencies compete with themselves

22. Reinventing Government: David Osborne and Ted Gaebler, Cont. 10. Mission vs. Rules based government: NASA and the Moon—Output based government 11. Incremental vs. Zero Based (or targeted) budgets 12. Decentralization The Circle Rounds

23. Corruption Debates Privatization enhances corruption. Enhanced by cultural differences (Gifts vs. Kickbacks; corruption as lobbying the Executive- Robert Klitgaard)

24. Corruption—the Real Problem? Robert Klitgaard  Corruption as functional and cultural?  Causes of corruption Poverty vs. ethnicity

25. Corruption, Cont.  The Ethical Issues in a society of poverty Obligation to family vs. obligation to society  The starving children problem  Are there benefits from corruption? Getting things done means paying for it

26. Corruption—the Real Problem? Robert Klitgaard  “Rent Seeking” Charges higher than market price  Corruption Too much government or too much privatization

27. Corruption—the Real Problem? Robert Klitgaard  Corruption: Graft Bribery Nepotism Kickbacks Insider bidding (wired)  Can and should corruption be controlled?

28. Group Discussions: Africa Bastian and Luckham- Governance Structures Manning- The Francophone Touch Berger- On Africa Picard Stuff

29. Discussion- Caribbean and Latin America  Nickson- Local Governance  Wunch and Olowu- The decline of the State  Clayton- Service Delivery Issues  Picard Stuff

30. Discussion- East and South Asia  Cheema and Rondinelli  Richard Reeves- Peshawar and 9/11  Goodwin and Nacht  Picard Stuff

31. Discussion- East and South East Asia  Stanley Karnow: Vietnam and the Philippines  Bhatt, Decentralization  Harrison and Huntington- Culture  Picard Stuff

32. Summary Discussion  Where are we now?  What don’t we know?