Do Budget Cuts Lead to Excessive Contracting?

Among the many interesting points in Stan Collender's column today (subscription only), there's this one about contracting and budget cuts: For example, Blackwatergate has made it clear that the Pentagon has been forced to use contractors because it doesn't have enough active-duty troops to fulfill its mission. It looks like the decision to use contractors was made to keep spending and the deficit lower than they would otherwise have been. It also appears as if the same thing has happened with the National Guard and reserves, and that has put the military and the country in a very precarious position. This raises several important and far-reaching budget questions. Was this, in fact, a budget-driven strategy? If so, did those who review the Pentagon's submission at the Office of Management and Budget direct and approve it? Has anyone determined what it will cost in the future in terms of pay, bonuses and living expenses to increase the number of active-duty troops so that contractors are not needed? You could ask the same question about contracting all across the government: that is, are agencies deciding to contract out because it is proven to be the most cost-effective and accountable way to do something? Are resource restrictions making it necessary to contract out, when it'd be better to rely on government workers? Or is it something else? Why are we contracting out so much when it's been such a disaster? If budget cuts do have something to do with wasteful contracting, it'd be good to know. Smaller government may then be less effective than bigger government. It would take a real liberal, someone who doesn't think more government is necessarily bad, to fix things up.
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