Some $9 billion managed by the Coalition Provisional Authority and intended for the rebuilding of Iraq has gone missing, journalists Donald L. Barlett and James B. Steele report in Vanity Fair, and the U.S. government doesn't seem particularly interested in finding out where it went. Barlett and Steele describe the Wild Wild Middle East atmosphere, in which two guys with no experience can get millions from the C.P.A. to protect civilian flights in and out of Iraq, and Bahamanian P.O. Boxes are the business addresses of choice for those supposedly keeping the books. Perhaps the most disturbing bit among many was just how out of touch Congress was on the doings in Baghdad during the C.P.A.'s tenure starting in 2003:
Over the next year, a compliant Congress gave $1.6 billion to Bremer to administer the C.P.A. This was over and above the $12 billion in cash that the C.P.A. had been given to disburse from Iraqi oil revenues and unfrozen Iraqi funds. Few in Congress actually had any idea about the true nature of the C.P.A. as an institution. Lawmakers had never discussed the establishment of the C.P.A., much less authorized it—odd, given that the agency would be receiving taxpayer dollars. Confused members of Congress believed that the C.P.A. was a U.S. government agency, which it was not, or that at the very least it had been authorized by the United Nations, which it had not. One congressional funding measure makes reference to the C.P.A. as "an entity of the United States Government"—highly inaccurate. The same congressional measure states that the C.P.A. was "established pursuant to United Nations Security Council resolutions"—just as inaccurate. The bizarre truth, as a U.S. District Court judge would point out in an opinion, is that "no formal document … plainly establishes the C.P.A. or provides for its formation.""Confused members of Congress" seems like both a phrase that should be far more common in news coverage, and an inappropriately charitable description. In any case, it's an incredible story from two of the best investigative reporters in the business -- well worth reading (and don't miss the Q&A Continue reading
Small Business Shafted Again
The New York Times today broke a story that I first learned about nearly two years ago – that the federal government’s annual accounting of federal contracts going to “small businesses” is routinely overstated, with much of that money actually going to large corporations.
I stumbled onto the story while analyzing six years of Pentagon contracts for the Center for Public Integrity. I’d been tipped off to the practice by a Defense Department analyst who’d been working with the contract data for years. He told me – and I subsequently documented it in the records – that under the contracting rules, if a small business is bought by a larger one, the contract is still counted as going to small business.
Continue readingThe Business of Business is Government
We do not know whether Congress will pass an overhaul of the nation's immigration laws; we do not know whether such a bill would follow the House's preference for border enforcement or the Senate's preference for amnesty for those already here plus increased ceilings on the number of legal immigrants for those aspiring to come. We do not know how the debate over this contentious and emotional issue will be resolved--to date the conventional wisdom has proven to be a bit off target, to say the least. One thing that apparently has been resolved, however, is that whatever results from the immigration debate, the solution will be implemented by a private company:
Continue readingThe Business of Business is Government
Muckraked! (second item) notes a Government Executive report that tells us that auditors are going to look into the FAA's outsourcing of operations at 58 FAA flight centers around the country to Lockheed Martin. Already, the Transportation Department has realized that $500 million of the supposed $2.2 billion in savings will, well, not be realized.
Among other issues, the IG office plans to look into changes in projections for how much the agency expects to save. When the contract was awarded, FAA announced that private sector performance would save the government $2.2 billion over the life of the contract, based on a 10-year estimate for the 5-year base period with up to five extension years. In its announcement of the audit this week, the inspector general's office quoted an anticipated savings of $1.7 billion. Continue reading
Lies Make Baby Jesus Cry:
Yesterday news broke that President Bush's Housing and Urban Development Secretary Alphonso Jackson became a lightening rod after it was reported that in a speech he stated that he believes that he should only give contracts to supporters of President Bush. Jackson made his point by telling an anecdotal story about a contractor trying to obtain a contract from HUD. The contractor, for some inexplicable reason, told Jackson that he did not like President Bush, at which point Jackson decided that he wouldn't give this man the contract because, as Jackson himself says, "Why should I reward someone who doesn’t like the president?" Now, Jackson is retracting his statement by saying that he made up the story. The HUD spokeswoman stated, "The secretary's story was anecdotal. He is not part of the contracting process. He was trying to explain to this group how politics works in D.C." Josh Marshall says, "This doesn't sound like a particularly exculpatory explanation. That story was made up. Jackson was just how explaining how he does business?" Think Progress offers two points about why this explanation is a bit unbelievable:
1) That excuse isn’t just difficult to swallow — it also contradicts the spokesperson’s first response in which she indicated Jackson was referring to a real contract: “On May 3, Tucker told the Business Journal that the contract Jackson was referring to in Dallas was ‘an advertising contract with a minority publication,’ though she could not provide the contract’s value.” It looks like Jackson is changing his story as criticism builds. 2) Bidding for a government contract isn’t ‘asking for money.’ It’s not Alphonso Jackson’s money to give away to his buddies. It is the taxpayers’ money. It should go to whoever can do the best job, regardless of their political views.So, either Jackson lied by making up his "anecdotal story" or he is lying to cover up the story. Either way the real issue is not with the factual accuracy of Jackson's story but whether he was factually representing his own belief when he stated: "Why should I reward someone who doesn’t like the president?" It seems that Jackson wanted to make this very point and then crafted a story to fit his predetermined belief/actions. Jackson needs to come clean on whether he is breaking the law by only distributing contracts to supporters of President Bush. Doesn't he know that lies make baby Jesus cry? (georgia10 at Daily Kos has more dirt on Jackson) Continue reading
A Past of Politicizing Procurement?
As Ellen Miller pointed out yesterday, the Housing & Urban Development Secretary, Alphonso Jackson, is decidely hands-on when it comes to his job--so much so that he even intervenes in procurement matters, if only when he feels prospective contractors are insufficiently enthusiastic about his boss, President George W. Bush. As reported in the Dallas Business Journal, Jackson was quite explicit in describing how he denied government business to a potential advertising contractor who had "a problem" with the president. The bit in his remarks that interested me was that Jackson said, "Why should I reward someone who doesn't like the president, so they can use funds to try to campaign against the president? Logic says they don't get the contract. That's the way I believe."
Continue readingSenator Calls For HUD Secretary to Resign:
Sen. Frank Lautenberg (D-NJ) called on HUD Secretary Alphonso Jackson to resign in the wake of his comments regarding the politicization of HUD contracting. Lautenberg: "If Secretary Jackson really said this, then President Bush should ask for his resignation. Government contracts must be based on merit, not on political favoritism." UPDATE: Waxman and Frank call for hearings into HUD contracting, according to Reuters.
Continue readingHUD Secretary Only Gives Contracts to Bush Supporters:
President Bush's Housing and Urban Development Secretary Alphonso Jackson seems to not understand the federal contracting process. You see he believes that only supporters of President Bush should get contracts. From the Dallas Business Journal courtesy of David Sirota:
After discussing the huge strides the agency has made in doing business with minority-owned companies, Jackson closed with a cautionary tale, relaying a conversation he had with a prospective advertising contractor. ‘He had made every effort to get a contract with HUD for 10 years,’ Jackson said of the prospective contractor. ‘He made a heck of a proposal and was on the (General Services Administration) list, so we selected him. He came to see me and thank me for selecting him. Then he said something … he said, ‘I have a problem with your president.’ ‘I said, ‘What do you mean?’ He said, ‘I don’t like President Bush.’ I thought to myself, ‘Brother, you have a disconnect — the president is elected, I was selected. You wouldn’t be getting the contract unless I was sitting here. If you have a problem with the president, don’t tell the secretary. He didn’t get the contract,’ Jackson continued. ‘Why should I reward someone who doesn’t like the president?’”Aside from this being a violation of federal rules as Think Progress points out:
Government business shall be conducted in a manner above reproach and, except as authorized by statute or regulation, with complete impartiality and with preferential treatment for none. Transactions relating to the expenditure of public funds require the highest degree of public trust and an impeccable standard of conduct.Jackson's most egregious statement comes when he explains his understanding of the contracting process:
“Why should I reward someone who doesn’t like the president, so they can use funds to try to campaign against the president? Logic says they don’t get the contract. That’s the way I believe.”Josh Marshall explains Jackson's "logic":
political supporters get contracts so they can pump a percentage of the profits back into the political party. Standard machine politics, at best. Organized bribery, at worst. And whatever you want to call it, the guiding principle of all contracting and government spending in the second Bush administration.Unbelievable. Continue reading
Paid more than the President
Currently, federal law sets the rate of pay for the President of the United States at $400,000 a year. Assuming that he works 48 weeks a year (there are those who would argue that our current President doesn't, but I tend to think those arguments are cheap and petty -- even on vacation, the office travels with him), that works out to an hourly rate of $208.33 ($400,000/(48 wks * 40 hrs/wk). Meanwhile, private contractors charge the government, for the use of some employees -- well, look here, on page 9 -- to see that Deloitte & Touche charges the Feds $249.37 an hour for a partner/principal, or here for the $294.21 charged by George Washington University for a Senior Executive Consultant/Lecturer (defined as someone who is a...
Top leader in subject area. Serves as distinguished subject matter expert in content or delivery. Maintains current knowledge of industry best practices and ongoing industry developments and completes whitepapers and speaking engagements on such topics as requested by preeminent publications and organizations. Works with other senior management and senior corporate management to develop the direction of the organization and ensure that the organization s people can meet those needs....or here to see the $225 an hour for a senior economist, $230 for a managing director, $320 an hour for a vice president (the one we elect--the one who lives in the Naval Observatory--earns a scant $108 an hour by comparison), $380 for a senior vice president or a senior managing director, and $420 an hour for president (twice what we pay the one we've chosen to faithfully execute the laws of these United States) charged by Lukens Energy Group. Good enough for government work indeed. Continue reading
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