Outsourcing the Pentagon?

The Center for Strategic and International Studies (CSIS) recently released a report questioning the Defense Department's outsourcing of professional, administrative and management services, particularly focusing on whether the government was relying too heavily on the private sector, and as a result, eroding Pentagon expertise.

"Demands on government expand, the federal workforce shrinks, and the technical skills within the government atrophy," wrote the CSIS.  "Examining the line of what is inherently government and articulating a clear policy that can be embraced by all the parties will be critical to maintain a healthy government-industry relationship."

The report also raises concerns over the increasing influence of companies worth over $1 billion.  When examining the sustainability of the current structure of the services industrial base, CSIS found that the structure squeezes out the mid-tier companies that "traditionally...served as a conduit for new ideas and improved business practices."  As a result, the purported benefits of private sector innovation cannot be fully realized. 

POGO is also investigating the issues at stake with outsourcing and whether contractors are performing inherently governmental functions.  The New York Times and the Wall Street Journal are also covering these issues closely.  Many benefits can be accrued by utilizing the private sector, but the federal government needs to be wary of losing control of vital programs and policy determinations.  Without adequate expertise, oversight, and competition, the government and taxpayers risk becoming prey to the private sector.

-- Mandy Smithberger

Comments

[freedumb.]

contracts are given to large corporations such as hallibuton/kbrs etc. The CONTRACTORS ARE THE ONES OUTSOURING FOR CHEAP LABOR. Get IT?

[KSBR]

To the Anon. Wat.---

I agree with your points.

When it comes to inherently governmental--defined sanely and nonpolitically-- there's not all that much that is governmental outside of making war (not staffing support functions), law enforcement (not staffing supt functions), making policy in any program or agency, and a few miscellaneous other things. The nongovernmental stuff is turning the crank, arms-and-legs work, as well as specialized work requiring focused expertise, like direct patient healthcare. There's no reason except politics why more of that can't be contracted out.

Ditto SOME support elements of acquisition. This could resolve today's crunch. Yes, we need tough, independent, empowered contracting officers and specialists. But the process of assembling RFPs, evaluating proposals (technically, to make a recommendation to the KO), and much of contract admin post-award is not inherently governmental and can be contracted out. Contractors, under current regulations, can be vetted carefully for conflicts of any type. It may take new kinds of services firms to do this, but it can be done. Almost by definition, any contractor of size could be viewed to have orgl COI, and therefore be barred. That's fine.

And we better be damn sure that the contractors who do this work are qualified. I say this because in the government, it's been evident that the expertise and experience quotient of acquisition personnel have been dropping steeply. And, although no one has measurements, it appears that productivity increases are not high on anyone's agenda. Officals just bray like donkeys for more staff, who will be managed in the usual wasteful way. And automation in acquisition processes still gets the stiff-arm from the veterans.

Regards,

KSBR

[Anoymous Watcher]

To KSBR:

"But it's not just a good buy or performance we want. We want good government and leadership."

That is precisely the point: this is not about a positive claim about the performance and quality of contracting out government administration; it's about a normative claim about whether such contracting and out-sourcing should be there to begin with. The underlying assumption behind the CSIS report is that there should be a line separating government and industry, and whether you agree with that assumption or not is an entirely different argument. Therefore, this debate on outsourcing governmental functions to the private sector is a debate independent from the qualitative claims about the performance of contractors in performing governmental functions.

"In the current administration, we have been overcome by incompetence, all the way to the top. But if you look at the troubled contracts and contracts, you also see boneheaded, badly bungled decisions on what to buy, how to buy, which firm to pick, and negligent oversight. The government is expert at setting up contracts and contractors to fail."

As for this claim, yes, there is some truth in it, because incompetent civil servants definitely contributes to some of these problems associated with contracting out so much governmental business to the private sector. However, this is not a condemnation on the ability of the government to perform its own functions but rather a condemnation on specific individuals within government. This problem can be solved if the government were able to attract a more talented workforce that is technically competent.

Will this require effort, time, and money? Of course, but is it worth doing if it will mean that governmental fucntions are performed by competent civil servants instead of being outsourced to the private sector? And thus we go back to my first point: do we think that there should be a line separating what is governmental and what is business? To me, the answer is yes, even if it means that it costs the tax-payers more in the short-term.

[KSBR]

Which do you want: a government besotted with incompetence in many (but not all areas), or contractors who have no stake in bureaucratic slothfulness, but may not be all that great. If you do the long division, which the government never does, the cost of government employees is more than the average contractor. The government won't count in its own overhead or the equivalent of corporate G&A when it makes this calc. And it undervalues tangible and intangible benefits. Contractors, in many, but not all, cases, are a much better buy.

But it's not just a good buy or performance we want. We want good government and leadership. That only comes from some mix of political and career officials and employees. In the current administration, we have been overcome by incompetence, all the way to the top. But if you look at the troubled contracts and contracts, you also see boneheaded, badly bungled decisions on what to buy, how to buy, which firm to pick, and negligent oversight. The government is expert at setting up contracts and contractors to fail.