Tomorrow morning I will be testifying before the full House Oversight and Government Reform Committee about the Sunlight Foundation's work to liberate federal spending data and experience in developing databases and tools for tracking spending. The hearing, entitled "Achieving Transparency and Accountability in Federal Spending," will be the second opportunity for me to discuss the Sunlight Foundation's Clearspending report where we identified nearly $1.3 trillion in misreported federal spending. The two hour hearing should be live-streamed on the committee website and will start at 9:30 am in Rayburn 2154.

It is an exciting time to continue this important conversation as just today there were two new federal spending developments. The House Oversight Chair Darrell Issa (R-CA) introduced a major piece of transparency legislation that would transform how we track federal spending and identify waste, fraud and abuse. You can read more about the bill from a blog post by Daniel Schuman, Sunlight's policy counsel. The White House also issued an executive order today that will put Vice President Biden in charge of an 11-member oversight board — very similar to the Recovery and Accountability Transparency Board — to address federal agency waste and fraud.

The entirety of my remarks appear below:

6-14-11 - Written Testimony of Ellen Miller before the Committee on House Oversight and Government Reform

Recently, the Pentagon released the list of its top 10 contractors for 2010, all which spent significant amounts of money lobbying Congress and contributing large sums to federal campaigns last year and in 2009.

Boeing—while only the second biggest contractor in terms of money received—spent the most money lobbying Congress between 2009 and 2010 at almost $35 million, according to the Sunlight Foundation’s Influence Explorer.

Northrop Grumman was second, spending $30 million.

The biggest contractor, Lockheed Martin, came in third for those same years spending $26 million lobbying.

Corporation	2009-2010 Contributions	2009-2010 Lobbying money	Total contractor misconduct cases	Number of contractor misconduct cases that were defense contracts
LOCKHEED MARTIN CORPORATION	$2,674,654	$25,950,000	67	25
THE BOEING COMPANY	$3,082,455	$34,746,000	47	20
NORTHROP GRUMMAN CORPORATION	$1,836,746	$30,920,000	33	17
GENERAL DYNAMICS CORPORATION	$1,457,799	$21,003,664	15	4
RAYTHEON COMPANY	$2,196,725	$14,100,000	22	13
OSHKOSH CORPORATION	$283,855	$2,140,000	0	0
L-3 COMMUNICATIONS HOLDINGS INC.	$557,282	$9,900,000	11	7
UNITED TECHNOLOGIES CORPORATION	$1,261,335	$22,630,000	16	6
BAE SYSTEMS PLC	$922,785	$9,377,000	8	1
SAIC INC.	$943,550	$6,390,000	11	5
TOTAL	$15,217,186	$177,156,664

 

Also noteworthy is the number of misconduct cases filed against each contractor, which usually results in fines to be paid by the contractor. All of the top ten names listed except OshKosh, as reported by the Project on Government Oversight, have had multiple cases filed against them with at least some violations incurred while working as contractors for the Department of Defense.

For instance, Science Applications International Corporation (SAIC) has five cases of misconduct as a Defense contractor, but has 11 cases total on record dating back to 1995, also according to data made available by Influence Explorer. For the five cases where SAIC was a Defense contractor, the company paid out $6.6 million.

This morning I testified before the House Committee on Oversight and Government Reform's Subcommittee on Technology and Information Policy about the failures of government to make rhetoric meet reality. The Sunlight Foundation has been excited about the new promises of data transparency, but sometimes the results are nowhere near the accuracy and completeness necessary for the data to be useful for the public.

Sunlight's Clearspending analysis found that nearly $1.3 trillion of federal spending as reported on USASpending.gov was inaccurate. While there have been some improvements, little to no progress has been made to address the fundamental flaws in the data quality. Correcting the very complicated system of federal reporting for government spending is an enormous task. It has to be done because without it there is no hope for accountability.

In order to fulfill the promise of the Open Government Directive and move forward to meaningful spending disclosure I offered a number of recommendations to the committee. These include unique identifiers for government contracts and grants, publicly available hierarchical identifiers for recipients to follow interconnected entities and timely bulk access to all data.

A video of the hearing should be available shortly on the committee's website and the entirety of my remarks appear below:

Written Testimony of Ellen Miller before the Committee on House Oversight and Government Reform

Senate Homeland Security and Government Affairs Chair Joe Lieberman just sent out a release announcing the creation of a new subcommittee to provide oversight of government contracting. The Ad Hoc Subcommittee on Contracting Oversight will be headed by Sen. Claire McCaskill, long a proponent of exposing fraud and waste in contracting.

“Management of federal contracts is one of the greatest operational challenges facing the federal government,” Lieberman said. “Spending on federal contracts rose to an astounding $532 billion last year. And for years the Government Accountability Office has listed government contracting on its list of programs at high risk of waste, fraud, abuse, mismanagement, or in need of comprehensive reform. This is a problem area that needs as much oversight as we can possibly muster.

“So, to more fully address the array of problems with federal contracting, I am establishing this new subcommittee with pride and great expectations. With her background as a prosecutor and state auditor, Senator McCaskill has unique investigative experience that will be crucial for this new subcommittee. I am certain that she will approach her new responsibilities with unmatched vigor to improve the value of all the taxpayer dollars devoted to federal contracting.”

McCaskill said: “Last year we made major strides in contracting accountability by establishing the Wartime Contracting Commission, and while I look forward to those investigations, we all know that outrageous contracting abuses occur in every facet of government. I can't wait to get to work saving huge money for taxpayers. They deserve it.”

Over the past few years various senators have attempted to create a committee or a commission both in the form of the famous Truman Committee, which investigated fraud and waste in World War II defense contracting. Sen. Byron Dorgan was in favor of the creation of a committee with full subpoena power, while Sen. Jim Webb and McCaskill sought the creation of commission with more limited powers. The Webb-McCaskill commission, named the Wartime Contracting Commission, was eventually established last year, but has yet to hold hearings.

The establishment of this new subcommittee, with oversight over more than just defense contracts, marks a huge step forward in the efforts by many to maintain a government contracting system that is free of waste, fraud, and corruption.

Scott Amey at the Project for Government Oversight's POGO blog writes about being positively surprised by one thing he found at USAspending.gov, the government site modeled after OMB Watch's FedSpending.org. 2007 data has been replaced by updated FY 2008 and 2009 totals. (This is shocking on two fronts. The government is usually years behind in reporting contract spending dollars.)

But Scott's more shocked to find that the government spent over $510 billion on goods and services in FY 2008. "And if history repeats, this total will increase by an additional $10-$20 billion as agencies report additional information," he writes. That amount would rank as the 25^th largest GDP in the world, he figures.

In the shadow of the huge multi-trillion dollar financial bailout, all these huge numbers are mind numbing. Federal contract spending is out of control, and deserving of much more oversight and transparency, don't you think?