The Contractors Strike Back

Looks like the military industry-welfare lobby isn't going to take kindly to Barack Obama's call to end waste in government contracting and procurement. They're preparing for battle like you'd expect of people who build weapons systems for a living.

Defense bloat has stunned auditors. A report last year from the Government Accountability Office found that 95 ongoing major defense programs exceeded their budgets, providing an accumulated excess cost of $295 billion to taxpayers. The programs include big-ticket items beloved by the military services, including the Army’s Future Combat System, the Navy’s Littoral Combat Ship and the Air Force’s Joint Strike Fighter, which are built by defense-industry giants like Lockheed Martin Corp., Boeing Co., and Raytheon Company, all of which have aggressive lobbying arms and excellent relationships with defense barons on Capitol Hill. According to the government’s Federal Procurement Database, which tracks federal contracts, the Defense Department reported over $394 billion worth of business with private contractors in fiscal 2008 alone.

Defense contractors and their allies in government will not let that money go without a confrontation, say defense reformers [...] Their “ground game,” the official said, will be run from the services’ legislative outreach and public-affairs offices, feeding talking points and strategy information to sympathetic members of Congress — something that “got the services in trouble in 2002″ with Defense Secretary Donald Rumsfeld when the Army resisted his ultimately-successful plan to scrap an archaic artillery system called Crusader. An “air game” will feature “a lot of ominous whispers on background to the press and conservative think tanks and commentators about endangering the American people and costing lives in some future fight.”

Gates, whom Obama tasked with working closely with OMB, has told confidantes that he views a sustainable long-term rebalancing of defense priorities as one of his most important tasks now that Obama has given him the chance to continue on as Pentagon chief. His service under the Bush administration was more about supporting the immediate needs of the Iraq war after Bush fired Rumsfeld in November 2006. “The services are accustomed to reviews that start out with a lot of talk about setting priorities and making tough choices but in reality usually end with leaving everything more or less intact,” the Pentagon official said. “This time they have a secretary who really means it.”

As Matthew Yglesias notes, what we're talking about here is the armed services - part of the federal government - using their own taxpayer-funded public affairs shops to lobby for more wasted contracting and against reform. The fact that the door between the Pentagon and the defense industry is constantly revolving means that a government official who steers contracts to the right company is simply fattening their own resume for the inevitable post-public service career. This is why it's called a military-industrial complex, after all.

And under the Bush regime, this kind of coziness between government officials and their cronies was simply rampant. In a little-discussed tidbit in yesterday's press briefing, Secretary of Agriculture Tom Vilsack mentions a $400,000 consulting contact with the USDA that he recently cancelled because career staffers considered it "inappropriate." There's a follow-up, and the information had to practically be dragged out of Vilsack, but the picture he eventually paints is one of a mob boss creating make-work jobs for his henchmen (Major Garrett is the questioner, trying to make some case for the necessity of useless contracts to avoid lawsuits, or something):

Q Secretary Vilsack, you talked about a $400,000 consulting contract deemed inappropriate. What was inappropriate about it? And just generally, to both of you, one of the problems in federal contracting is when you cancel a contract, sometimes a contract will sue the government because they disagree with the cancellation. How do you end up saving the taxpayers money if you get involved in protracted litigation if it's not for cause?

SECRETARY VILSACK: Well, I don't want to go into great detail about this particular contract, other than to say that the career folks who watched this process unfold in the last waning days of this last administration were very concerned about the process, the connections and relationships between people receiving this half-a-million-dollar contract, and what they intended to do with the resource, which the career folks felt was unnecessary and inappropriate.

They made a very strong and powerful case to me that the process wasn't followed as it should have been; their input was not valued as it should be. We put a lot of confidence in people who have been through this process before, in terms of knowing precisely how best to use these tax dollars. And this particular consulting contract -- I've looked at the details -- I didn't see any value to USDA from it. I will tell you that it was rather startling to see that a substantial amount of money had already been spent on foreign travel, which, under the circumstances, we did not think was appropriate.

In terms of litigation, I feel fairly confident on this one that we will prevail, and I'd be surprised if it's questioned.

Q Can you tell us, Mr. Secretary, who this involved and more details? It sounds like a rather startling discovery that you've made, and taxpayers probably would like to know more about it.

SECRETARY VILSACK: Well, I think what taxpayers need to know is that every single department of government has now been charged by the President to review in detail the nature of contracts that we've entered into. In order to do what American families are doing -- American families are sitting down today and trying to decide, how do we save money, how do we eliminate unnecessary spending -- their expectation is the government does the same.

I don't want to get into details about this, but I will tell you that I think it's appropriate for us to do this. I'm glad the President has instructed us to do this, and I think we'll probably continue to find savings.

Q But why not get into details? This is government funds -- the public has a right to know, with all due respect.

SECRETARY VILSACK: I'm happy to share -- I don't want to step on protocol here -- I'm happy to share, if Mr. Gibbs expects it to be --

Q Transparent? (Laughter.)

MR. GIBBS: Lay it out. I'm all for it.

SECRETARY VILSACK: Well, it involves an individual by the name of Stan Johnson who had a close connection with the previous administration. It was a consulting contract for half a million dollars; a substantial amount of money was spent for foreign travel. To be honest with you, we saw very little, if any, value to the USDA. And a number of career folks were very concerned about how the process unfolded. And had their input been valued, the contract would not have been entered into.

Q Is this like a favoritism thing, Mr. Secretary?

SECRETARY VILSACK: You know, I don't know about that. I don't know. I just know that there was a close connection. It was a contract that I think was unnecessary, and I know the career people were very concerned about the way in which it unfolded.

Q Consulting on what issue, sir? Consulting on what issue?

SECRETARY VILSACK: Well, that's a good question, and I can't answer it.

Q Can we get more details from your department later?

SECRETARY VILSACK: Yes, be happy to.

Here's a little interview with Stan Johnson. He tried to give some background to what he actually did for the USDA, but mainly it appeared to involve flying from his home in Reno to Washington to work for something called the National Center for Food and Agricultural Policy. Their senior fellows include John Block, the Secretary of Agriculture under Ronald Reagan, and Dan Glickman, Agriculture Secretary under Bill Clinton. And by the way, the NCFAP still has two other contracts with the USDA.

As these things go, NCFAP doesn't even sound all that bad, but this is just one example of the insidious web of official Washington, between think tanks and contractors and politicians and journalists and staffers and hangers-on, that Obama is basically taking on with this effort. It's necessary, but it's going to be a very hard road that's bound to be more than a little disappointing along the way.