ABSTRACT
The movement for privatization of a wide range of government activities is a response to fiscal pressures on the state and to an ideologically founded distrust of the public sector encouraged by the Reagan and Bush administrations. Under the American system the state is subject to constitutional restraints that simply do not apply to the private sector. The Constitution of the United States restrains state power not private conduct. The liberties protected by the Bill of Rights and the Fourteenth Amendment are protected from only infringement attributable to government action. There is nothing new about private institutions, both profit making and not-for-profit, providing services paid for by government. This fact has forced the courts to determine the circumstances under which the actions of such private service providers will be treated for constitutional purposes as if they were actions of the state itself.
