Free Markets, Free People


The Promise And The Reality (Part II) – Massive Waste, Fraud And Abuse Likely With Passage Of “Stimulus” Bill

The fear-mongering and panic inducing rhetoric used by the Obama administration and Congresional Democrats concerning the “stimulus” bill has set up another probable broken promise – this time on an unimaginably massive scale.

The Promise: The end of wasteful government spending and more accountability:

-Make Government Spending More Accountable and Efficient: Obama and Biden will ensure that federal contracts over $25,000 are competitively bid. Obama and Biden will also increase the efficiency of government programs through better use of technology, stronger management that demands accountability and by leveraging the government’s high-volume purchasing power to get lower prices.

- End Wasteful Government Spending: Obama and Biden will stop funding wasteful, obsolete federal government programs that make no financial sense. Obama and Biden have called for an end to subsidies for oil and gas companies that are enjoying record profits, as well as the elimination of subsidies to the private student loan industry which has repeatedly used unethical business practices. Obama and Biden will also tackle wasteful spending in the Medicare program.

The administration’s promise was transparency, bid competition, and new auditing resources and oversight boards.

The Reality: But this “stimulus” bill will most likely overwhelm any ability to properly monitor the spending anticipated. And, if such proper monitoring and regulating of spending is indeed required, it will drastically slow the spending process which is supposed to provide the stimulus.

The Obama administration’s economic stimulus plan could end up wasting billions of dollars by attempting to spend money faster than an overburdened government acquisition system can manage and oversee it, according to documents and interviews with contracting specialists.

The $827 billion stimulus legislation under debate in Congress includes provisions aimed at ensuring oversight of the massive infusion of contracts, state grants and other measures. At the urging of the administration, those provisions call for transparency, bid competition, and new auditing resources and oversight boards.

But under the terms of the stimulus proposals, a depleted contracting workforce would be asked to spend more money more rapidly than ever before, while also improving competition and oversight. Auditors would be asked to track surges in spending on projects ranging from bridge construction and schools to research of “green” energy and the development of electronic health records — a challenge made more difficult because many contracts would be awarded by state agencies.

The stimulus plan presents a stark choice: The government can spend unprecedented amounts of money quickly in an effort to jump-start the economy or it can move more deliberately to thwart the cost overruns common to federal contracts in recent years.

“You can’t have both,” said Eileen Norcross, a senior research fellow at George Mason University’s Mercatus Center who studied crisis spending in the aftermath of Hurricane Katrina. “There is no way to get around having to make a choice.”

So here’s the choice – remove the oversight, drop the transparancy, go with “no-bid” contracts and eschew the auditing process which will slow the spending to a trickle, or keep them in place and accept the molasses slow flow of supposed stimulus funds.

The probability is we’ll see the promise go by the boards. Why? Because of the insistence by both Congressional leaders and the administration that this bill be passed now, that it can’t wait and that it shouldn’t be debated (and by implication, shouldn’t be closely examined either).

“We don’t have the means to make sure we don’t blow through billions of dollars and give it to the wrong people,” said Keith Ashdown, chief investigator at the nonpartisan Taxpayers for Common Sense. “We’re on track to lose billions, if not tens of billions, to waste, fraud and abuse.”

Goodger said the federal contracting system has been extremely troubled in recent years. He emphasized the lack of trained employees to manage contracts, which he called a “human capital crisis.”

Stan Soloway, president of the Professional Services Council, a group that represents government contractors, does not oppose the stimulus package. But he said the government appears to lack the planning and the “infrastructure and architecture” upfront to manage the spending.

“Without it,” he said, “we’re going to have a repeat of what we’ve seen over and over and over, from major weapons systems to Katrina and Iraq.”

Hope and change.

~McQ

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6 Responses to The Promise And The Reality (Part II) – Massive Waste, Fraud And Abuse Likely With Passage Of “Stimulus” Bill

  • The Obama administration’s economic stimulus plan could end up wasting billions of dollars by attempting to spend money faster than an overburdened government acquisition system can manage and oversee it, according to documents and interviews with contracting specialists.

    I sort of think that the haste is absolutely intentional: get the money allocated and spent before ANYBODY can cry foul.  One would think that, given the amount of grousing from the left about the money that has been wasted and misspent in Iraq, they’d be quite careful about spending.  If one DID think that, it would be proof that he doesn’t understand the cupidity and hypocrisy of the democrats (spit), which know no limits.

    Oh, one small point: as I understand it, TAO and his infant (!) adminstration didn’t write this bill: in typical fashion, he punted to SanFran Nan and Dingy Harry and asked THEM to do it.  So, it’s not TAO’s stimulus package so much as it is their package.  One wonders if he didn’t do this intentionally to escape blame when things go sour.  It’s sort of like voting “present”.

    Hope and change.

    Actually, it’s “change and hope”: TAO and the rest of the democrat scum (with the willing aid of too many Republicans) is changing the way money gets spent by the government.  We can only hope that it isn’t the final step toward socialism and / or long-term depression.

  • Associated Builders and Contractors (ABC) today denounced an Executive Order signed by President Obama that repeals Executive Order 13202, that prohibited federal agencies and recipients of federal funding from requiring contractors to sign union-only project labor agreements (PLAs) as a condition of performing work on federal and federally funded construction projects.

    “Today’s decision to repeal Executive Order 13202 opens the door to waste and discrimination in federal and federally funded construction contracts,” said ABC President and CEO Kirk Pickerel. “This action removes the safeguards that prohibited discrimination based upon union affiliation in the awarding of federal contracts.

  • Or, perhaps, we’re in a really severe crisis which could deepen into an intense depression, and Obama realizes this isn’t time for business as usual, we have to move quickly and boldly.  Seriously, I don’t think you get how serious this is — the last few decades have screwed up the economy big time, the housing bubble was only an effect, not a cause.  The US is on a downward spiral if something isn’t done.  Wake up!

  • So, digging a debt hole faster then the last few decades is going to get us out of the debt we’re already in.  Didn’t work in the depression, so why not try it again.

    We just gotta do something, doesn’t matter what it is.  That’s the best argument for the bill in front of the Senate? If we just spend enough and hope, we’ll get through it.

    Seems to me the Democrats have NO FAITH in the American economy or worker.

  • I was partially convinced of the systemic risk and need for fast action last fall, but have since come to the conclusion that we are no longer at risk of a sudden collapse. Instead we are simply in a deep recession. Increase spending on relief, perhaps do some minor  stimulus, and cut the payroll tax temporarily.

    Things like nuke plants, power grid, even repairing bridges are things we should debate on their own merits and not do half-assed. And except the roads and bridges, should be done privately anwyays, with at most tax incentives.

    Any “psychological” effect of a “big bill” has already faded. Regardless of government contractors making it big, we are going to have more bad news coming from the private sector (as in any recession) with stores failing, GM bankruptcy, etc. There is no way that any amount of pork psychology will cover additional panic.