Although there is widespread disagreement on issues like the economic recovery and the Wall Street bailout, nobody wants taxpayer dollars to be wasted and abused. Our recommendations provide a simple way to generate billions of dollars that could be put to better use on more sensible and responsible programs.
As we hear about regionalnewspapersshutting their doors, we take pause to recognize the critical function local beat reporters play in our lives. Case in point: yesterday, Los Alamos National Laboratory (LANL) put out a press release, probably to preempt POGO's release to the press of a February 23 internal Department of Energy (DOE) letter that outlines how LANL has not been able to keep track of its huge stocks of plutonium and highly enriched uranium--enough for hundreds of nuclear weapons--via its Material Control and Accountability (MC&A) program. Unlike the AP's stenography of LANL's press release, Sue Vorenberg of The Sante Fe New Mexicanwrote an article that dug deeper into the press release, exposing the “circular logic” that LANL is using to avoid answering the question of how it can be 100 percent certain that no material has been stolen when it does not know where the material is.
Similarly able to see through the spin, NNSA-beat reporter Todd Jacobson with the Nuclear Weapons & Materials Monitor contacted POGO for a comment as soon as he saw LANL's press release, knowing full well that LANL would not be forthcoming with information about problems unless it was fearful of an impending media storm. POGO has been raising concerns about MC&A at LANL for the last six months.
While the Monitor did mention it, one piece of the story has not yet gotten as much attention as it deserves: the fact that DOE was aware of MC&A problems last year, but still granted LANL the full $1.43 million performance award fee for security, which includes “Material Control and Accountability” as one of the areas of performance evaluated.
In addition to MC&A problems at LANL, this week the DOE IG released a report which found that of “about 37 percent (15 of 40) of the domestic facilities we reviewed [such as those that reprocess waste, universities, and other government agencies], the Department could not accurately account for the quantities and locations of certain nuclear materials” and that DOE “agreed to write-off large quantities without fully understanding the ultimate disposition of these materials.” This is another issue that is best reported by a journalist who understands the DOE bureaucracy.
Looks like Recovery.gov (not .com, Mr. Vice President) is starting to link to the recovery web pages of individual states and federal agencies. The White House has also begun to post state certification letters, in which governors are supposed to officially request the stimulus money and pledge to use it to create jobs and promote economic growth (some governors have suggested that they might not accept the recovery funds.)
The site will probably be going through many more changes in the weeks ahead as data starts to come in on how states and agencies are actually spending the stimulus funds. We'll keep you posted as we learn more.
The subject of the hearing is a new report that will be released later today by the Government Accountability Office (GAO), which found that federal agencies continue to award business to contractors even after they have been suspended or debarred as a result of criminal violations or poor performance. Congress is worried that these so-called "convicts and con artists" will not be excluded from the billions of dollars in contracts that will be awarded under the $787 billion economic stimulus program.
The Excluded Parties List System (EPLS), a federal database of suspended and debarred individuals and businesses, is supposed to prevent these parties from receiving any future federal contracts. However, the GAO found numerous instances when they continued to receive new contracts due to flaws in the database and inadequate contracting procedures. Many of these parties were debarred for egregious violations that directly threatened national security and the safety of U.S. troops and citizens.
The GAO report found that contracting officials are either not checking the EPLS as they are required, or are checking it but are not aware that certain individuals or companies are in it due to a flawed database search system. When agencies suspend or debar parties from future contracts, they often enter them in the EPLS without a unique identifying number. This requires users to search by name, which invariably misses nicknames, aliases, or corporate name changes.
An employee shall not use his public office for his own private gain, for the endorsement of any product, service or enterprise, or for the private gain of friends, relatives, or persons with whom the employee is affiliated in a nongovernmental capacity, including nonprofit organizations of which the employee is an officer or member, and persons with whom the employee has or seeks employment or business relations. (Emphasis POGO's)
Defense Secretary Gates' recent prohibition against discussing the FY 2010 budget is designed to prevent selective disclosure distorting budget development. If the Air Force pilots featured in this video are active duty, not only are they distorting the decision-making process, they may be violating the law.
We were very pleased to read in Roll Call today (subscription required) that the Obama administration is no longer considering appointing a former lobbyist to head an important Department of Justice (DOJ) office that oversees legal policy and judicial nominations.
Earlier this month, press reports suggested that the administration's top candidate to head DOJ's Office of Legal Policy was Mark Gitenstein, who as recently as August 2008 was employed by Mayer Brown lobbying on behalf of the Chamber of Commerce, AT&T, Merrill Lynch, and other corporate clients. The Office of Legal Policy plays a crucial role in advising the administration on judicial selection, and Gitenstein's lobbying disclosure forms indicate that he worked on issues that would almost certainly confront a judicial nominee, including class-action and other legal reforms, and federal preemption of lawsuits filed in state courts.
Public Citizen took the lead (and POGO and others joined them) in opposing Gitenstein's nomination, and given all the other "uniquely qualified" lobbyists who have received waivers in order to serve in the administration, we're certainly glad to see the revolving door spin a little slower.
Governmentattic.org has posted several documents from the Federal Reserve in response to a FOIA request about the Fed's lending activities related to the credit crisis. We spent some time combing through the documents, and as previousnewsreports suggested, the Fed's reputation for opacity and secrecy is alive and well.
Here's the back story: Bloomberg reporter Mark Pittman filed a FOIA request last year in an attempt to get the Fed to disclose the recipients of some $2 trillion in loans, and to identify the assets it accepted as collateral. The Fed has authority under section 13(3) of the Federal Reserve Act to make discounted emergency loans, and has greatly expanded its emergency lending in response to the ongoing financial crisis. In fact, as Bloomberg points out, total Fed lending rose by well over $1 trillion following a decision in September 2008 by central bank governors to accept lower-rated securities as collateral. Bloomberg requested detailed, transaction-level information on the recipients and terms of the loans distributed by the Fed between April 4 and October 25, 2008.
But in a five-page response, Board Secretary Jennifer Johnson told Pittman that the Fed was withholding over 2,000 pages of information under the (b)(4) and (b)(5) FOIA exemptions, which protect against the disclosure of "trade secrets" and "inter-agency or intra-agency memorandums or letters." Many banks have opposed the release of records about the Fed's lending because it would signal their weakness and potentially reveal too much information about the value of their riskier assets. Scott Talbott, senior VP of government affairs for the Financial Services Roundtable, explained that "taxpayers have a right to know where their tax dollars are going, but one piece of information standing alone could undermine public confidence in the system." Johnson even argued that the Fed's secrecy "ultimately advances the interests of taxpayers, preserving the integrity and effectiveness of financial stability measures and, in the long term, preserving an opportunity for maximum recovery by the Federal Reserve Banks in the event of default by individual borrowers."
What little information the Fed did disclose is almost completely redacted (click below to view the documents). In a few pages, there is simply a passing reference to “IDC,” which stands for Interactive Data Corporation, a seller of fixed-income securities information.
Pardon our skepticism, but we have a hard time seeing how taxpayers' interests are protected by the Fed's decision to withhold information on what it did with trillions of taxpayer dollars. How are we to reconcile the Fed's behavior with Ben Bernanke's statement before Congress that "central banks should be as transparent as possible, both for reasons of democratic accountability and because many of our policies are likely to be more effective if they are well understood by the markets and the public"? On that note, Ron D'Vari, CEO of NewOak Capital LLC, said that he'd "love to hear the methodology, how the Fed priced the assets. That would unclog the market very quickly." It's also worth pointing out that the Fed has been tight-lipped about its efforts to protect against conflicts of interest among the firms that are managing its mortgage-backed securities purchase program.
Bloomberg has filed a lawsuit to obtain details about the Fed's lending activities, arguing that the collateral lists are "central to understanding and assessing the government's response to the most cataclysmic financial crisis in America since the Great Depression." It remains to be seen whether or not the Fed will be more responsive to questions from Congress about its expenditure of trillions of taxpayer dollars. Meanwhile, the Washington Post reported this weekend that a federal judge has ordered the Treasury Department to hand over records to Fox News related to the bailout money it spent on AIG, Bank of New York Mellon, and Citigroup.
