February 04, 2007

Business, Washington style

WASHINGTON - In June, officials at the General Services Administration were short of people to process cases of incompetence and fraud by federal contractors, and they responded with what has become the government's reflexive answer to almost every problem.

They hired another contractor.

Without a public debate or formal policy decision, contractors have become a virtual fourth branch of government. On the rise for decades, spending on federal contracts has soared during the Bush administration, to about $400 billion last year from $207 billion in 2000, fueled by the war in Iraq, domestic security and Hurricane Katrina, but also by a philosophy that encourages outsourcing almost everything government does.

  • Competition, intended to produce savings, appears to have sharply eroded. An analysis by The New York Times shows that fewer than half of all "contract actions" — new contracts and payments against existing contracts — are now subject to full and open competition.

  • The top 20 service contractors have spent nearly $300 million since 2000 on lobbying and have donated $23 million to political campaigns.

  • The biggest federal contractor, Lockheed Martin, which has spent $53 million on lobbying and $6 million on donations since 2000, gets more federal money each year than the justice or energy departments.

  • Contracting almost always leads to less public scrutiny, as government programs are hidden behind closed corporate doors.

  • Companies, unlike agencies, are not subject to the Freedom of Information Act.

A just-completed study by experts appointed by the White House and Congress, the Acquisition Advisory Panel, found that the trend "poses a threat to the government's long-term ability to perform its mission" and could "undermine the integrity of the government's decision making."

No comments: