Privatization in the City: Successes, Failures, Lessons

by Emanuel S. Savas

In Privatization in the City, E .S. Savas comprehensively examines the evolution and implementation of former New York Mayor Rudolph W. Giuliani’s aggressive privatization program in the face of a city council generally hostile to privatization. Savas identifies, examines, evaluates, and documents all forms of privatization employed, including contracting, competitive sourcing, divestment, leases, vouchers, franchises, default, withdrawal, and voluntarism. He contrasts these efforts in New York with privatization in several other cities across the country, ranging from Indianapolis to Phoenix. After analyzing the costs and benefits―both quantitative and qualitative―of New York′s privatization program, Savas concludes that significant savings were achieved during Giuliani’s eight years in office.

240 pages, Paperback

First published May 30, 2005

Reviews

[Frank Stein · Rating 3 out of 5]

Though this book often feels a little slapdash, Savas really had his finger on the pulse of privatization in New York City for almost 20 years and he is able to show the amazing success the city achieved in contracting out city services.

The most surprising to me was how the threat of privatization vastly improved the city's own municipal workers' productivity. These park attendants, mechanics, clerks were all able to improve efficiency by 50 to 100 to 200 percent when they discovered suddenly that they didn't have lifetime tenure in cushy AFSCME-protected jobs. Often when the threat faded so did the productivity gains, but that is all the more reason to keep the pressure up.

Most interesting though were the failures. A poorly written contract for fixing potholes led to a contractor who endlessly paved a few blocks around his asphalt plant, and Giulani's attempts to privatize New York's unbelievably bloated public hospital program (most big cities have 1 public hospital, if that, New York has 11) brought national attacks and eventually retreat. But Savas shows that the city learned from its mistakes and was able to constantly improve on contracting out. Ultimately a hopeful book.