I'm a bit confused by this sensible and provocative assessment. Let's assume the average gov't salary for these workers is 90K. 30-50% is way to high for benefits. Most generous benefit packages run around 30-35% and INCLUDE health care, which is listed later as an additional cost.

The point about retirement/pension/annuities is a fair one, but the $207,000 number for the gov't contractor is not counting the double costs of overhead for the government (both its own and the contractors).

If we don't have good numbers on what the comparative costs are between adding additional government workers and outsourcing jobs to the private sector, we better get them. How else are we supposed to be able to make a judgment call on when and where it is appropriate to outsource?

Contract workers "cost the govt" $207,000 a piece for their work - that doesn't mean the employee receives that - it means the company contracting receives that on average. That's more that $125,000, even, I suspect, with other costs factored in.

The real point is that privatizing government functions inserts a profit overhead for private contractors that doesn't exist for public employees. The government is not a for-profit institution, so it can be run more efficiently in the provision of services (not always goods).

It's good that other observers and commenters see the apples-to-guavas nature of Sanders' cost comparison. He's a smart guy, knows contractors well in most respects, and should have dealt with that data problem.
It's true that many people in the "media" and Congress do not understand the diff between a fully loaded rate and a contractor employee's salary; glad that was straightened out.
On the government side of the comparison, unless it is specified in some detail that is unpresented so far, we should be skeptical that the "load" on the salary includes the full measure of benefits and retirement plans. The figure does not--because government never includes it except in A-76 studies--likely include the true cost of government overhead, for example a slice of the loaded costs of all sources of supervision and management, up to minute slices of the compensation of McConnell and Bush, plus their retinues and facilities, etc. Further, government compensation never takes into account the very valuable, but hard to monetize, worth of employment security, or being shielded in most cases from any accountability. If you captured all the tangible and intangible costs left out of such comparisons, you might find the figures rather similar. But Congress doesn't appropriate that way and agencies don't budget that way. Nonetheless, the costs are absolutely real, even if we can't identify them precisely.

Thanks to Michael Lent for elaborating/expanding on the challenges of comparing contractor vs. govie costs. He's absolutely right about the intangible value of government job security, protection from market forces, etc. -- very difficult to quantify but absolutely part of the equation. By the same token, the flexibility you gain by hiring contractors vs. govies (as Sanders noted) also has significant value: every contract has one form or another of "escape clause" for the government; all are time-limited, ultimately; and individual contractors who aren't up to snuff can be removed immediately, with little fuss. Compared to what's involved in canning a govie, that alone can be darn near priceless. It's also true that the contractor world can attract and provide to government some categories of talent the Feds simply couldn't get on their own.

Perhaps the important thing isn't figuring out who costs more or less, but recognizing that they cost "different" -- you're acquiring or foregoing distinct things when you choose to contract vs. hire career staff, and vice versa. What concerns me is that in recent years, it's become less a choice than a default: contracting out has become the path of least resistance, for a variety of reasons; this seems to have been especially true of the IC post-9/11. Lots of reactive, short-term thinking vs. what we like to call strategic human capital management.

Sanders and co. have incentive to hold down the price tag for govies, and bulk it up for contractors, in hopes of persuading Congress to lift personnel ceilings and allow the IC to hire more staff. And it seems a few on the Hill are already sniffing the bait. It may well be that contractors are doing things govies ought to be doing, but I hope the discussion doesn't focus solely or even primarily on dollars and cents. In many ways that's a distraction from the core issues at stake here.

Even if the costs of doing government work in house or through contractors was roughly the same, and I doubt that after figuring profit, there would still be a problem. As we have learned to our dismay in Iraq outsourcing opens the door to all sorts of waste, theft and corruption.

I have been on both sides of the fence; just short of forty years as a military and civilian intelligence operative, and some four years as a civilian counterintelligence lecturer at the Pentagon. One of the advantages--and it happened to me--at contract renewable time the contractor can be let go without much ado; not so with a government employee
Gerhardt