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Report: Privatization of State Economic Development Agencies Can Undermine Integrity and Accountability

February 24, 2011 Comments off

Report: Privatization of State Economic Development Agencies Can Undermine Integrity and Accountability (PDF)
Source: Good Jobs First

Transferring state business recruitment functions from government agencies to private entities is not the panacea that its proponents suggest, and the track record of those few states that have taken the step is filled with examples of misuse of taxpayer funds, political interference, questionable subsidy awards, and conflicts of interest, according to a report published today by Good Jobs First, a non-profit, non-partisan research center based in Washington, DC.

“Rather than making economic development activities more effective, privatization is often little more than a power grab by governors and politically connected business interests,” said Philip Mattera, research director of Good Jobs First and principal author of the report.

Interest in economic development privatization has surged recently. It is being promoted by newly elected governors in Wisconsin, Ohio, Iowa and Arizona who are urging that state commerce or development agencies be replaced by public-private partnerships (PPPs).

“Turning economic development over to PPPs is fool’s gold,” said Good Jobs First executive director Greg LeRoy. “What really matters is business basics: strategic public investments in skills, infrastructure, and innovation—not privatized smoke-stack chasing.”

+ Full Report (PDF)

Categories: business and economics, Good Jobs First, government and politics, privatization
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