Thursday, September 30, 2004

The Compassionate Pentagon

Too bad that its compassion is in the wrong direction, towards those that sell it products and services:

More than 40 percent of all Pentagon contracts, a total of $362 billion, have been awarded on a no-bid basis over the last six years, according to a report issued yesterday. It showed that the biggest companies won the bulk of their contracts without going through a competitive process.
The nation's largest military contractor, Lockheed Martin Corp., received the most Pentagon business on a non-competitive basis. Seventy-four percent of Lockheed's $94 billion in Pentagon contracts since 1998 were awarded without competition, according to a report from the Center for Public Integrity, a Washington non-profit group that studied 2.2 million Pentagon contracts totaling $900 billion.
"Competitive bidding at the Pentagon happens less often than we think, and the no-bid controversy surrounding Halliburton in Iraq actually is, unfortunately, not an aberration," said Charles Lewis, the center's executive director. Lewis' organization was one of the first to study contracts won by Halliburton and other companies in Iraq and Afghanistan. Yesterday's report grew out of that earlier work.

To have things delivered on the no-bid basis is a little like you calling up the local car dealer and asking them to send you a nice little vehicle at whatever price they deem fair. I can easily imagine how that would go down with most of us. We'd get very expensive cars.

What's Pentagon's excuse for this horrendous practice? This:

Thomas Greer, a Lockheed spokesman, said that because of "the substantial investment and lengthy development cycles followed by limited annual production quantities," it is often not cost-effective for the Pentagon to have competitive bidding. Greer added that "it is important to note that sole source awards still mandate contractor performance."

So Pentagon is sort of married to a few corporations because it's too difficult to ask for bids on these specialized projects. Ok, maybe. But how is the contractor performance mandated? Or rather, who analyses the costs and efficacy of the contractors? Hmmm:

Currently, for instance, half of the defense budget is outsourced to contractors, while oversight of these contracts has declined, the report said. The Pentagon has reduced the number of government officials who supervise contractors, instead hiring contractors themselves to oversee and manage others, according to the report, which said that the Pentagon hired a contractor to determine how many contractors it had employed.
"There is an even more fundamental problem underscoring our entire investigation: the stunning lack of accountability," said Lewis, who added, "This is a Keystone Kop situation where no one is monitoring the monitors. This is a very serious situation and the Pentagon is treating it like a hair in the soup."

It's a mess. And this is one of the reasons for the mess:

The leading recipient of campaign donations from military contractors has been President Bush, who has received $5.4 million from the industry since 1998. Military contractors, however, began stepping up contributions to Sen. John Kerry after he won the Iowa caucuses.
Before the caucuses Kerry had received $332,000 from the industry, and he has received just under $2 million since then. The Republican Party has received $62 million from the industry since 1998, compared with $24 million for the Democratic Party, according to the report.