Question

Which of the following is NOT true about privatization?

a. Where employees lacked collective bargaining rights in the public sector, privatization of their jobs has provided many of them with the opportunity to be represented by a union in the private sector.
b. Privatization of public-sector jobs was begun in the 1980s under the Reagan administration.
c. The Bush administration has proposed privatizing up to half of all federal public-sector jobs.
d. Public-sector jobs are more likely to be privatized when the public sector union-management relationship is adversarial.
e. The private sector cannot enter into contract with government agencies.

Answer 1

The statement that 'The private sector cannot enter into contract with government agencies' is not true about privatization. In fact, government contracting with private entities is a core component of the privatization process.

Step-by-step explanation:

Among the options provided for what is NOT true about privatization, (e) 'The private sector cannot enter into contract with government agencies' is the incorrect statement. Privatization often involves the government contracting private companies to provide services that were previously managed by the government. This practice has been used to different extents throughout the history of the United States, including massive expansions and reliance on private contracts during the administration of President George W. Bush.

Contrary to option (e), the government frequently enters into contracts with private entities to perform a variety of functions. This ranges from infrastructure development to providing social services, evident in examples such as military base construction, food services, and student loans through organizations like Sallie Mae, which transitioned from a government agency to a fully private company.

Therefore, it is clearly established that the private sector can and does enter into contracts with government agencies, and this practice forms a significant part of the privatization process.