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Feb 13, 2009


KSBR querrilous


You know it is a felony for contractors to lie in proposals or to commit fraud on their books. My guess is the vast majority of contractors do neither; the rate of fraud might be no more than say, the rate of cheating on personal income tax, but that's just a guess. Just because contractor bids and books have not been audited or audited competently gives you no grounds--statistically, logically, even emotionally--to hold the consistent POGO weltenschang that most contractors are crooks.
As for bargaining to take advantage of the market, have it it. We're all taxpayers, and the government should get the best deal it possibly can. Contracting officers who don't attempt this need to be disciplined or fired. That's part of their sacred trust.
That said, many contracting officersfeel like real heroes for knocking a hundred basis points off fee, when the real dollar hit to the government might be in sloppily audited overhead costs (DCAA--not due to workload, but very poor quality management), or direct labor that is either not market priced, or where individuals fit the labor categories in a manner that builds in far too much profit.
The government has the means--all the time, not just now--to get a better deal than it does. It is just so poorly motivated and poorly managed to do this.

Speaking of motivation....
Dr. K of the K school consistently seems to think that the govt people need to be left alone, unsupervised, shielded from nasty (actually stupid) trade press articles, and pesky Congressional oversight. With no supervision of the government workers' sacred trust, he thinks the government will get the best value. That, more than anything else, suggests which side he may favor. He's in the minority of Democrats who don't believe in regulation. Look where that's got us in financial services.

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