Obama’s missed opportunity

President Obama missed a golden opportunity to confront, to prioritize and to fix systemic problems in government contracting. The President’s economic plan relies heavily upon government procurement professionals to expedite the massive amounts of new government spending, and it would have been reassuring if Obama had moved quickly to address the long simmering, cauldron of procurement problems. But, nope. No bold leadership. No change either.

Instead, the President voiced the well-worn and false outrage over “no bid” contracts. He painted the false picture that all government contractors are wasteful cheats. This misguided rhetoric has served so many for so long, that, perhaps, the President is just reluctant to discard old applause lines.

Countless association studies and Congressional testimonies have indicated that the central problem in the federal procurement system is an insufficient number of well trained procurement officials. Too few contracting officers are made responsible for too much federal spending, often resulting in rushed statements of work to meet urgent requirements.

Obama’s procurement reform speech was disappointing because instead of learning from the mistakes of the past, he has announced that he is going to repeat them. The media claimed the President was going to unveil a detailed procurement reform plan – except that there were no details, only a plan to study the problem.

To his credit, the President calls for “an assessment of the capacity and ability” of the federal acquisition force to be performed by September 2009, but, by September, with trillions in new spending already on the books, our procurement personnel will be drowning in the avalanche of new government spending.

Contracting officers who are under pressure to commit the stimulus money quickly, are simultaneously being required to submit a whole range of new progress reports. Inspectors General and oversight folks have been provided with generous funding in the stimulus and are being ramped up to provide even more progress reviews. So, contracting officers have even more external people providing direction, oversight, and input, without understanding that only contracting officers have the responsibility for committing taxpayer dollars effectively. So, the job of a contracting officer just got harder.

Even when the Obama administration’s study finally understands the damage caused by too few acquisition professionals, it will take months to hire and train more contracting officers. Put another way, if the procurement reform plan continues as announced, the earliest we could expect new acquisition officers to begin to arrive will be in the January of 2010. We witnessed the rushed pressure to commit trillions in federal spending within three weeks of inauguration, but when it comes to procurement reform, a delay of 8 months is considered acceptable.

Federal acquisition officers are caught in a vise of two conflicting requirements. One requirement is to award contracts quickly to help revive the economy, and the second requirement is to follow to the letter the precise guidance and reporting requirements now demanded by new layers of oversight and IG watchdogs.

Some may bow to the pressure to quickly award contracts that they would have rather issued differently. Statements of work may be rushed. Contracts may be bundled into ever larger omnibus contracts to reduce the work load. Small businesses will scream because they will be pushed to the sidelines.

Many without the responsibility for making the system work will then scrutinize the process at a far more leisurely pace and with far more resources to catalogue the full list of procedural mistakes and shortcuts. For the acquisition force that is fighting the fire and trying to put out the rising flames, these reviews and criticisms that will be published 12 to 60 months after contract award. By that time, no one will remember that our nation’s leaders were screaming to get the contracts out as fast as possible.

Some of the most experienced procurement professionals may decide to go slowly. They may move ever so cautiously and only after asking “Mother may I” to the legion of oversight people that might have any role. They have the experience to know that oversight always trumps federal contracting, and that process often matters more than results. Bids and reviews may take longer, and delays will be common. There is a great cost to this approach, too, (particularly to small businesses), but at least the contracting officer may gain some protection.

The other missed opportunity was President Obama’s chance to end the fiction of the “no-bid” contract. His false outrage over “no-bid” contracts repeated a hackneyed oxymoron-there is no such thing as a “no bid contract” since there has to be at least one bid in order for there to be an award. But, semantics aside, most government contractors also know that the greatest source of the supposed “no-bid” contracts is Congress itself.

Most earmarks, in addition to having a congressional district, or a state, targeted to receive the funding, are also specific enough in their defined requirement, that a preferred contractor is slated to receive the opportunity. The recent conundrum of 8,576 earmarks in the FY09 budget creates yet another “judge my words, not my actions”, scenario that reflects badly on President Obama.

Our country may have tough days ahead as we grapple with problems created by decades of indulgence. But, we are a resilient, innovative nation, and we have people, in our country, right now, who are capable of solving this problem. September 2009 is a lot longer than many of us wanted to wait for procurement reform, but better late than never.

Lurita Doan is the former Administrator of the U.S. General Services Administration.

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