Last month’s unseemly dustup over a state-owned company from Dubai contracting to manage six key U.S. ports was very revealing. Most Americans probably didn’t even know that such deals were even possible.

Of course, this one involved an Arab country, which made it particularly sensitive. But just as this unfortunate story was unfolding, something very different was going on in Chicago, where officials in city hall announced that Mayor Richard Daley was considering a deal to lease Midway Airport to a private company as a way to raise new revenue.

“The mayor has challenged his entire financial staff to look creatively to improve the city’s financial position,” the city’s chief financial officer told The Chicago Tribune. “Federal dollars are drying up. This is thinking outside the box. . . . We have to be considering any and all possibilities.”

Is allowing a private operator, particularly from a foreign country, to take over your airport thinking outside the box or just off the wall? Long-term leases of this kind may be unusual in this country, but not elsewhere in the world. Still, the finance officer noted that if Midway is privatized, every precaution will be taken to ensure that “the city of Chicago and everybody else concerned is 100 percent satisfied with security matters.”

The Daley administration has some experience in these kinds of deals. A year and a half ago, it concluded an agreement with a Spanish-Australian consortium to lease the 7.8-mile Chicago Skyway, a southeast side toll road and bridge, for 99 years. The deal, worth $1.8 billion to the city in upfront cash alone, was approved by a quick 45-0 vote of the city council, with many of the aldermen giddily comparing the deal with the Louisiana Purchase or buying Manhattan Island from the Indians.

In effect, the nation’s third-largest city, in a complicated financial transaction, sold off some of its key public infrastructure to private operators. But Mayor Daley, perhaps the nation’s premier urban Democrat, isn’t alone in seeking these kinds of arrangements. The Chicago Skyway links to the 157-mile Indiana Toll Road, and just a few weeks ago, the Indiana Legislature passed a compromise bill to allow a 75-year lease of the road to the very same international consortium, for an upfront payment of $3.8 billion.

Indiana Gov. Mitch Daniels, who was head of the U.S. Office of Management and Budget in George W. Bush’s first term, had pushed the deal hard and sent a letter to legislators congratulating them on their courage in making their decision. Unlike the Chicago City Council, the Indiana House barely passed the bill, 51 to 48, without a single Democratic vote, and Democrats promised to make the privatization a campaign issue, because polls showed that voters opposed it by a 2-to-1 margin. In campaigning for the bill, Daniels pledged to use money from the lease to build roads and create jobs.

These transactions may seem unusual, but they fit neatly into a larger pattern. State and local governments are privatizing or outsourcing many of their core services and functions to for-profit companies, either as a way to cut costs or raise revenue.

In mid-March, the state of Texas signed a contract with IBM Corp. to take over operation of the e-mail systems for 13 agencies, with the potential for more to be added, as well as local governments.

Texas also is in the midst of outsourcing many of its social services infrastructure, even including the operation of call centers to help residents determine eligibility for a wide range of social services. Florida is doing much of the same, including all its child welfare programs. A growing number of cities are entering into partnerships with private companies to operate their water treatment facilities. Entire towns such as Sandy Springs, Ga., and Centennial, Colo., are contracting out all of their government activities except police and fire.

A lot of this has not come easily. There have been varying degrees of scandals in Florida, resulting in resignations, firings and terminated contracts. The Texas state auditor early this year criticized the outsourcing of payroll and human resources functions at agencies operated by the Health and Human Services Commission, which the auditor said failed to oversee the contractor properly. In Wisconsin, Republicans are charging that contracts for software to run the state’s administrative systems were influenced by campaign contributions to Democratic Gov. James E. Doyle.

There will continue to be such problems, real or perceived. When public contracts are let or leases signed involving large amounts of money, you get charges of undue political influence or cronyism.

Whether it’s all a good idea is open to argument. But for a lot of reasons, it’s unlikely that this trend will reverse. So governments at all levels must accept it and build capacity to negotiate and then administer sophisticated leases and large, complicated contracts across a range of activities. And they should figure out a way to make the contracting process so transparent as to minimize the inevitable conflict-of-interest charges. Good luck with that one.

Peter Harkness is the editor and publisher of Governing magazine, published by Congressional Quarterly Inc.