Feral Jundi

Thursday, February 12, 2009

Industry Talk: Congress Looks to Clean Up Contractors, But What About Themselves?

Filed under: Industry Talk — Tags: , — Matt @ 4:33 PM

     Hey, I am all for trying to clean up this industry.  I really am, and much of my research goes towards bettering my little niche of an industry.  

    But when will Webb, McCaskill, Waxman and company take a critical look at the way the government manages these contracts?  I will admit poor leadership in my industry, but when will they admit that the government has done a terrible job in managing these contracts and applying quality control?  

    To me, this is like saying ‘hey, build my house, and I am going to go to Mexico for a year, and when I get back that thing better be perfect’.  I would never dream of building a house like that, and of course there would be problems if you are not actively involved with the process, or have someone you trust watching over the process. The government leadership involved in managing us, must also be questioned and held to some accountability too.  

   And what is government leadership?  Figure out what you want us to do, hash out all the loose ends and legalities, call us when you need us, and actually apply quality control and management over the whole thing.  If you need more oversight manpower, then hire more federal managers to do so.  It’s as if there is this moral disengagement in government, and you just don’t want to admit fault or deal with a problem that could lead to deaths.  I say deaths, because this is a war, and people have died because of poor government contracting practices.  

   When someone gets electrocuted in a shower, that was built by a contractor that cut corners, whose fault is that?  Is it the government’s fault for not insuring that shower was built to a standard, or was it that contractor’s fault for building it as cheaply as possible so the government could save money and that company could actually make money?  Like I said, the government has been absent in the ‘caring department’, and there have been victims do to that moral disengagement.

   Now I am not calling for micro-management, I am just calling for the government to get involved with the contracts, and apply quality control. The government would also be ill served to try to stymie the power of a free market with these companies as well.  The best they can do, is make sure all the companies are playing by the same set of rules, and the contracts are managed fairly and consistently.  

     Profit making is also a part of what makes business thrive, so I don’t really understand the logic of demonizing this concept.  Every businessman starts a company, with the idea of making money and succeeding.  To take that away, takes away the one force that drives business to be the best.  That’s unless government want’s business to be more like them?  But that is a whole different topic….. 

     We have stepped up and answered the call when this country reached out during their time of need. We provided a service, and some companies did better than others in that endeavor.  I admit we have our problems, but with the war and disasters like Katrina, we stepped up and did a service that the government could not provide on it’s own.  The least the government could do is care enough to make sure the job is done right, at the time it is being done, as opposed to dealing with a poorly built house when they come back from Mexico. Just my two cents on the whole deal. –Matt

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Congress looks to clean up contractors

By: Jen DiMascio

February 12, 2009 04:51 AM EST

Defense contractors blamed for waste, fraud and abuse — and even for some civilian casualties in Iraq — are now facing a new Congress intent on cleaning up the mess.

The contractors are contrite about their mistakes, making the case that not all of them are created evil.

“We have millions of transactions every year that work,” said Alan Chvotkin, a senior vice president for the Professional Services Council, a contractors trade group. But missteps by KBR, Blackwater USA and Hurricane Katrina contractors stand out, he said.

“We’re colored by the failures,” he said.

Congress already is engaging on the issue.

The bipartisan Commission on Wartime Contracting, pushed into law by Democratic Sens. Jim Webb of Virginia and Claire McCaskill of Missouri, recently held its first hearing. And the Senate Homeland Security Committee has launched an ad hoc subcommittee on contracting oversight, under the direction of McCaskill, a former state auditor who has made contracting accountability one of her trademark issues.

During the commission’s hearing, Webb acknowledged that contractors do important work but said the Pentagon has leaned too heavily on them.

“Contrary to popular mythology, the extended reliance on wartime support contractors does not always save money,” Webb said. “It’s not always the most cost-effective solution. It’s simply been the easiest solution sometimes.”

But solving perennial problems with government purchasing is far easier said than done.

Claude Bolton, a former Army weapons buyer who now works for the Defense Acquisition University, told a contracting panel sponsored by Arnold & Porter this week that he’s skeptical about real change. For decades, commissions have studied what’s wrong with defense contracting, he said, noting: “The recommendations are always right, and they’re always the same.”

But in the case of Iraq, the sheer number of contractors — tapped to fill out the ranks of an all-volunteer military — creates an image problem.

“I’m worried we’re going to have 30,000 troops in Iraq and 100,000 contractors,” McCaskill told Defense Secretary Robert Gates during a recent appearance before the Senate Armed Services Committee.

But McCaskill’s nightmare may be reality — one that’s not at all out of place, Chvotkin said.

Even if the number of logistics contractors decreases with the number of combat troops, a large number will remain in Iraq for reconstruction and community development work, he said.

And those contractors will require security, so expect private security contractors to remain there, too, Chvotkin said.

But he understands the incidents that created the impression: waste in the wake of Hurricane Katrina and the 2007 incident in Baghdad in which Blackwater security guards shot and killed some civilians while protecting a convoy.

As a result, Iraq has pulled the company’s license to operate.

And the State Department, which has used Blackwater to protect its diplomats, does not plan to renew the current contract that runs out this spring, according to spokesman Andy Laine. The department also uses two other companies for private security work: DynCorp and Triple Canopy. And the department hasn’t yet decided who will do the work Blackwater used to do, he said.

That could wind up a sticky issue for Secretary of State Hillary Clinton. As a Democratic presidential candidate, she vowed to slash the government contracting ranks. But as the secretary of state, she’ll still continue to use private security contractors.

For now, the ban on Blackwater applies only to contractors inside Iraq. Whether the company will continue to operate elsewhere will be determined, Laine said. 

Regulation attempts

Congress, led by Senate Armed Services Committee Chairman Carl Levin (D-Mich.), has sought to draw better boundaries for security contractors, asking the Defense Department to clarify what is — and what is not — an “inherently governmental” activity as a step toward barring contractors from performing quasi-combat missions.

But that’s a debate Chvotkin doesn’t want to entertain at all.

He’s prone to reframe the question and kick it back to the military, saying it needs to decide how it derives the mix of active duty, National Guard and contractors it needs in war zones.

Chvotkin is trying to show members of Congress that contractors represent jobs, even for some of their constituents. And he’s trying to repair the contractors’ tarnished image by having them acknowledge their missteps.

“Government contractors need to get real comfortable with accountability,” said Michael Robinson, senior vice president of Levick Strategic Communications.

They’ll need to talk about their commitment to openness and do so in an ethical way, Robinson said, adding that change was likely to come regardless of who took the White House. Both President Barack Obama and his Republican campaign rival, Sen. John McCain (R-Ariz.), had vowed to tighten contracting practices.

Where contractors win

Still, life might not be so bad for contractors, whose ranks expanded under the Bush administration.

Former Rep. Tom Davis (R-Va.) pointed out that Rep. Henry A. Waxman (D-Calif.) — who, as chairman of the House Government Oversight Committee, had led numerous inquiries into KBR, the company overseeing a multibillion-dollar Army logistics contract — has moved on to chair the House Energy and Commerce Committee.

And according to Davis, McCaskill’s inquiries will help feed the Democrats’ anti-war base and will highlight two or three examples of waste without instituting any real substantive outcome.

The real boon to contractors and to Republicans, Davis said, is the $800 billion-plus economic stimulus package that Congress is finishing.

“That work cannot possibly be done in house,” Davis said.

Story Here

4 Comments

  1. Matt,

    I am glad you found this article and highlighted it. You are exactly right that this is a little bit like the pot calling the kettle black.

    My fear is that given governments reaction to previous real or perceived abuses the legislation they come up with is overkill an hamstrings the good companies who were not and were never going to be the problem in the first place. Sarbanes-Oxley comes immediately to mind. It was a direct result of the Enron and Worldcom scandals and forces all companies now on the planet to jump through numerous administrative hoops which cost them money and waste people's time. Oversight is always required to prevent excess and waste but if we leave the solutions up to the congress we can expect that they will over do it in a big way.

    Rock on man…

    Jake

    Comment by Jake — Thursday, February 12, 2009 @ 4:13 PM

  2. Appreciate seeing this and your perspective on it.

    Waxmans oversight committee did little more than huff and puff with few results. We got a few good quotes out of him. There were very few changes which resulted from those investigations.

    The Department of Labor which is supposed to oversee the DBA benefits for Contractors needs some oversight itself.

    It would be a good idea to flush all of these government entities of the good old boys, D's and R's, and bring in some fresh blood that hasn't been tainted yet.

    The contracting business can be equitable for all involved.

    Comment by Marcie Hascall Clark — Friday, February 13, 2009 @ 4:02 AM

  3. Jake,

    Thanks. I think it is important to not sugar coat this stuff and tell it like it is. There needs to be a 'push back' on this, that comes from a position of rational thought and logic. I also think that the companies need to speak up more on this stuff. I know this is a little unrealistic, because who in their right mind would bite the hand that feeds them? But hey, if you don't speak up, then how will anyone know there is a problem?

    I think congress would be well served to pose the question 'what is your recommendation' for better government/civilian relations, and less finger pointing and scapegoating. It is all about having a shared reality, and I just don't see that with these latest actions. S/F -matt

    Comment by headjundi — Friday, February 13, 2009 @ 3:49 AM

  4. Hey Marcie,

    Thanks for your input and I appreciate the work you and your group are doing. Your site is all about demanding accountability at the companies, and at congress. For the readers, check it out. -Matt

    http://www.americancontractorsiniraq.com/

    Comment by headjundi — Friday, February 13, 2009 @ 6:04 AM

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