Terminating Policies for Convenience: The Role of Privatization in Policy Instability

• In Event: Privatization, Policy Instability, and the Pursuit of Effective Public Service

Abstract

Most traditional policy process theories hold that incremental change results from coalition-building, negotiation, power sharing, and the gradual disruption of entrenched policy monopolies. In recent years there is growing evidence that increasing reliance on privatization—especially in the form of contracts and grants—allows elected executives to bypass these traditional pathways and enact large-scale policy shifts more rapidly than policy process models might anticipate. By leveraging standard contractual terms, notably “termination for convenience” clauses, new political leaders can dismantle or redirect entire policy areas overnight, without the painstaking negotiations and consensus-building typically required.  Privatization is introducing policy instability, inserting a lever that allows executives to accomplish short-term objectives to make electoral gains with little consideration of long-term consequences or social needs. 

To illustrate this phenomenon, I explore two cases in which recent incoming U.S. presidential administrations used privatization (and associated termination levers) to abruptly alter policy. The Biden administration’s termination of private corrections contracts and the Trump administration’s dismantling of green energy and sustainability initiatives highlight how executives can use contractual terms to swiftly achieve political aims. These cases reveal a critical yet underexamined trade-off: while private-sector involvement can enhance efficiency and foster innovation, it can also undermine democratic values and destabilize policy areas. This research presents a new model of the policy process to challenge long-standing assumptions about how policy change unfolds, underscoring the need to reassess the role of contracts and privatization in modern governance and their implications for institutional stability, democratic accountability, and the long-term public interest.

Author

• Benjamin Manning Brunjes, University of Washington
  Presenting Author