Letter: End the acquisition Cold War

Regarding: “Wagner: The cost analysis muddle”: This is the most important issue in government affairs.

I have learned that most people in government -- including inspectors general, lawmakers and ESPECIALLY their staffs -- have no clue about operating costs and how the productive world operates. Retired Sen. John Breaux (D-La.), to his great credit, recently admitted he only learned of these matters now that he is in business. At my firm, I see government’s business naiveté collide with reality whenever we hire government people and they’re stunned to see that their paycheck is eerily dependent on company revenue. What’s so spooky to them is everyday reality for the shrinking productive majority. Now that’s really spooky!

The truth is government employees live in a socialist enclave, and they develop a completely socialist mentality. They quickly lose sight of the fact that the vitality of their unproductive enclave depends entirely on the success of the U.S. economy. Unfortunately, their mentality increasingly hinders the economic success of every productive venture they touch. That socialist mindset is bad for government and worse for the rest of us.

There is some truth, however, in the notion that an already budgeted office can either be used or not used. In fact, we have seen Defense Department and Homeland Security Department organizations make it very hard for their managers to contract through any other agency’s contract organizations or vehicles. After all, agencies have built the contract shops and contracts -- why not make people shop there?

The answer to that question (for the benefit of those who apparently slept through micro economics class) takes us back to the former Soviet Union. That’s where government would decide that everyone in a given part of Moscow had to buy at his or her assigned local meat shop. After all, the meat shop was subsidized, so why not force people to shop there to guarantee that the shops would stay busy?

The problem is that when everyone in an area has to shop at a particular store, the butcher gets smug and comfy with his monopoly. Customer service, if it ever existed in that shop, evaporates. Because every part of Moscow needs its own shop, the supply of qualified butchers is strained. Soon, some shops have only unqualified butchers. Service goes from just bad to slow and bad. Long lines form.

If you are a DOD or DHS manager with general acquisition needs in this wartime environment, all this Soviet-style inefficiency might sound frustratingly familiar to you. Unlike IGs, members of Congress and the Government Accountability Office, you understand that sloppy service and long wait times represent costs.

In the federal acquisition environment, the question becomes: Why does every government organization need to budget for contracting shops and independent operations for indefinite-delivery, indefinite-quantity contracts when another government agency has been established to specialize in general acquisition? Astonishingly, in one of the most spectacular innovations in the history of government anywhere, this other government agency has been using an efficient non-socialist model for many years.  

That agency is the General Services Administration. As the name implies, GSA serves the entire government. Yes, it charges a fee, but only when it’s working. Just like a business. And just like a business, GSA refers to the people it supports as “clients.” Have you ever heard a DOD or DHS contracting officer refer to their monopolized clientele as clients? I haven’t.

The answer to the question “Why do all federal agencies need their own contracting shops?” is simple. They don’t! They should use GSA and stop starving it. Why are Congress and DOD trying to kill GSA by starvation? It’s the socialist mentality at work. Our own special little Cold War rages right here in the federal acquisition community.

What can be done? It will take some guts and enlightened Western-style leadership. Here are my thoughts:

1. Industry groups should deliver online training in real-world economics and it’s interaction with government. Hire people like Breaux to share their real-world revelations. Fuel government interest by publicly belittling IGs and GAO officials who issue negative pronouncements based on cost with language that exhibit complete ignorance of the most basic principles of cost/benefit analysis. (The arrogance in the system needs a good dose of shame.)


2. Ask your elected officials and their staffers if they prefer capitalism to socialism. (We all know their red-white-and-blue response in advance.) Then ask them to read this letter and tell you which side of this Cold War they will be on.


3. At every opportunity, challenge your senior DOD and DHS acquisition officials into removing all their socialist obstacles to the use of GSA vehicles and assisted services.


4. Pressure department leaders to offer up the costs of their redundant contracting operations as much-needed savings.


5. Stop studying and counting acquisition employees and contracts. The Office of Personnel Management should start consolidating the contracting specialists from the Federal Acquisition Service at GSA.


6. Allow the GSA regions to compete with one another and manage their own margins. (Everyone is local to everyone in the Internet Age.)


7. Let fee-for-service offices that fail do just that.


8. Allow DOD and DHS clients to shop for the best acquisition support for their important missions.


9. Remind current GSA leaders that they pretty much had it right in 2002 (even outside the Federal Systems Integration and Management Center). They should ONLY fix what was broken. Start with standard interpretations of the regulations.


10. Fire GSA’s chief financial officer and bring back the more flexible funds management as soon as possible.


11. Rationalize, clarify, and simplify acquisition laws and regulations as a matter of national security. Understand that minor and unintentional violations are going to happen. IGs should identify trends for managers. Annual review of the trends by managers should drive training goals, not personal vilification in GSA.


12. Focus the IGs on egregious and clearly intentional violations of the laws. Boost the penalties for special and rare cases to the level of treason with capital punishment. (For example, the recently convicted senior Air Force acquisition official would have been jailed for life or administered a lethal injection for her true crime.)  


13. Raise the issue of structural inefficiency in the acquisition system with the leading presidential candidates. (You want change? I got your change.)