Contractor Tier System Wasting Taxpayer Money:


Rebuilding New Orleans and the Gulf Coast region is proving especially costly thanks to a dysfunctional contracting system. To understand how taxpayer money is wasted Reuters asks the key question, “How many contractors does it take to haul a pile of tree branches?” The answer: “at least four: a contractor, his subcontractor, the subcontractor’s subcontractor, and finally, the local man with a truck and chainsaw.” If you want to get a roof patched you are going to need to get six contractors: “At the bottom tier is a Spanish-speaking crew making less than 10 cents for every square foot of tarpaulin installed. At the top, the prime contractor bills the government 15 times as much for the same job.” Watchdog groups and the Government Accountability Office have criticized the process claiming that it has cost taxpayers tens of millions of dollars while the smaller subcontractors are being cheated by the large contractors.