It's not a "truism" at all. For a start, companies are going bust taking these contracts[1] -- going bust generally being a good sign that they aren't making a profit. More importantly, the alternative is a state-owned security service (police, army, etc) who are likely to be inefficient, highly unionized with tons of overhanging pension payments. Is that cheaper? I don't know which is why I was saying in my original comment that
these things can be studied.
[1] http://www.out-law.com/en/articles/2012/july/special-adminis...