| Privatization doesn’t work;Just ask Indiana
Mitch Daniels was a pioneer of bad ideas in privatization during his early years as Indiana’s governor. In 2006, corporate-backed appointees working for Daniels in Indiana’s Family and Social Services Administration (FSSA) pushed through plans to privatize the state’s welfare system.
Then-FSSA Secretary Mitch Roob awarded a 10-year, $1.6 billion contract without a cost-benefit analysis or official public input. Roob pushed ahead with his privatization scheme, not because it was in the public interest, but because his most recent employer—Affiliated Computer Systems (ACS)—stood to gain the most from the contract.
The FSSA privatization plan has been a failure for everyone involved—especially the Indiana families who lost out on the help they needed to get by. Replacing 1,500 case workers—many of whom were AFSCME members—with an automated call center created yet another obstacle for low-income families to receive the services they desperately needed. State officials asked IBM and ACS to fix the problems. The state government fired IBM when sub-contracted ACS dragged their feet.
“Mitch Daniels has given handouts to his corporate donors at the expense of Indiana’s neediest families,” said Council 62 Executive Director and AFSCME International Vice President Dave Warrick. “By replacing the human touch of state case workers with an impersonal call center, ACS took away access to desperately needed services from thousands of Hoosiers.”
Last week, Marion Superior Court Judge David Dreyer ordered the state of Indiana to pay IBM $52 million, even though he acknowledged that ACS failed to “make any serious effort with respect to its portion of the [program] responsibilities.” Dreyer continued: “Neither party deserves to win this case. This story represents a ‘perfect storm’ of misguided government policy and overzealous corporate ambition.”
Gov. Daniels intends to appeal the decision. But AFSCME members know that justice will be served only when Indiana families are getting the services they need and voters put an end to misguided privatization schemes once and for all.
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