Policy Analysis No. 742

Privatizing the Transportation Security Administration

After the terrorist attacks in 2001, the federal government moved quickly to increase spending on aviation security and take control of passenger and baggage screening at U.S. airports. Congress created the Transportation Security Administration (TSA) in 2001, and then transferred the agency to the new Department of Homeland Security (DHS) in 2002.

TSA’s main activity is operating security screening at more than 450 commercial airports across the nation. The agency also runs the Federal Air Marshal Service (FAMS), analyzes intelligence data, and oversees the security of rail, transit, highways, and pipelines. TSA has 62,000 employees and an annual budget in 2013 of $7.9 billion.

After more than a decade of experience, it is clear that the creation of TSA and the federal takeover of airport screening was a mistake. Auditors have found that TSA’s screening performance has been no better, and possibly worse, than private screening. And TSA has become known for mismanagement, dubious investments, and security failures. Former TSA chief Kip Hawley noted last year that the agency is “hopelessly bureaucratic.” And recent congressional reports have blasted TSA for “costly, counter intuitive, and poorly executed” plans and for having an “enormous, inflexible and distracted bureaucracy.”

We would be better off without a monolithic federal agency that controls all major aspects of aviation security. Most airports in Europe and Canada use private companies for their passenger and baggage screening. That practice creates a more efficient and innovative security structure, and it allows governments to focus on gathering intelligence and conducting analysis rather than on trying to manage a large workforce.

Congress should abolish TSA. The TSA activities that have not shown substantial benefits should be eliminated. Passenger and baggage screening—which represents about two-thirds of TSA’s budget—should be moved to the control of airports and opened to competitive private bidding. And the remaining parts of TSA—including intelligence and analysis activities—should be moved to other federal agencies.

Chris Edwards is the director of tax policy studies at the Cato Institute and editor of www.DownsizingGovernment.org.