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Mar 31, 2010



There were many signs since 2003 that KBR had issues, but KBR was too big to fail and was the only contractor that could do the job - that is in the minds of the Army. The Army knew that KBR was getting higher prices, but they felt it was worth it because we were at war and no other contractor could do the job. You have to understand that the Army and many contracting officers are focused on delivering the product, cost does not matter. They get too close to the contractor and lose objectivity. DCAA reported numerous cost issues very early and were ignored and are still being ingnored. But KBR is not the only example where the Government looked the other way on cost in the interest of getting the product. Most large contractors such as Boeing, Lockheed, GD, have benefited from the mentality that all that matters is getting the product. That's why sole-source has to be the last resort - competition on an annual basis has a better chance of keeping contractor costs in check. Any doubt, look at contracts awarded in the intelligence community. Excess profit, prices, all in the interest of national security. No chance of a hearing to expose the corrpution since there is no oversight of the GAO or IGs.

Observer IV

The KBR labor waste, retrospectively, would be very easy to spot and control. Some one individual was the contracting officer's tech rep for the task, who should have known the workload and how the contractor was staffing. The waste could have been shut off quickly. Did the IG identify that person? If there was no one, than the stuckee is the contracting officer. If not, go up the chain(s). KBR deserves some scrutiny, and penalty if at all possible. The government oversight person should at a minimum be fired and also subject to investigation for criminal negligence. If this contract were a fixed price task, the person responsible for that should be investigated for the same violation. Military, Dept. of the Army civilians, and contractors are all obligated to report waste. There needs to be a penalty for ignoring the obvious.

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