Government contractors:
This article is worth a read. I think that federal contracting is a real problem, and I'm not just saying that because I think they are going to make my job redundant:-) I've worked with several contractors who have been extremely competent and honest. However, there are some serious problems with the government's use of contractors.
1. Generally, because contracts are written to be very specific, contractors can only do what is in their contract. In some jobs this may not be a problem, but in others, the duties change day to day, and cannot be predicted. Most places I have worked would prefer to have a government employee filling a billet than even a very competent contractor because they need flexibility.
2. Contractors are expensive. This is a common complaint, but it's absolutely true. If I quit my government job and went to work for a contractor, I could work in the same office doing nearly the same job and make twice as much, maybe more (if you're interested, I mostly don't because I love the flexibility of my job. I make enough money, so it's more important to me that I enjoy and don't get bored with what I do than that I make more money). Plus the government would also be paying the company providing contractor me. I know the government saves on benefits, but it definitely doesn't make up the difference.
3. Contractors have divided loyalties, particularly those who own stock in the company they work for. A contractor's first loyalty is to the company he works for, not to the government. I'm not doubting the honesty of contractors, but the fact is that a contractor isn't trying to save the government money and time; that's not his job, and in fact, that hurts his employer.
I believe that contractors should NOT be supervising government employees (and this is not supposed to happen, but it does sometimes, at least de facto). I also believe that certain very sensitive things (things like taxes) should be handled by government employees, though this is a gut feeling and I can't really justify it. Contracts should come up as often as reasonable. And all contracts should be re-evaluated reasonably often to make sure that contracting the job out is the most efficient way of handling it.
Contracts are a valuable tool for short term work, for things that we currently lack the expertise in the federal government to handle, and to bridge gaps while civil service employees cannot be hired. They should not be used because the agency cannot find a federal employee to do the job, and they should not be used for indefinite (read permanent) periods.
