As local governments shrink, private consultants reap rewards
"I would probably bring in McKinsey," Mitt Romney once told the Wall Street Journal editorial board, explaining how he might, should he win in November, hire management consultants to help shape a presidential cabinet.
Romney, a devotee of corporate culture who began his career at the Boston Consulting Group, promises to transfer that technocratic ethos and private-sector reverence to the Oval Office. Indeed, management consulting firms are already marketing themselves to state and municipal governments as professionals with the necessary business savvy to help manage a downsizing austerity state.
"When crisis strikes consultants are called. Consultants thrive on chaos," says Tom Rodenhauser, managing director at Kennedy Consulting Research & Advisory, which tracks the industry. "When a municipality is facing huge budget issues, and they can't solve the problem themselves, they'll call in consultants and make the tough choices that either politically or practically elected officials can't make."
Consultants, like Romney, have the appeal of "real-world" experience which, in early 21st-century America, means experience in the hard-nosed competitive marketplace outside of the public sector's one-time easy comfort. Since August 2008, the number of public employees has already been cut by 662,000 nationwide. Consultants draw on experience from a private sector that has relentlessly slashed employment, broken unions and outsourced work for decades.
Accenture, for example, tells clients that "the crisis forever redefined how people live and work; how businesses operate; and how governments must govern." Government must "adapt to this new normal—an environment of economic uncertainty, stagnant revenues, austere budgets and increasing demands from citizens, businesses and other governments for core services delivered in new ways."
Consultants often recommend privatizing services like education and slashing public employee workforces, though sometimes governments might just be looking for outside expertise to validate decisions that have already been made.