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RE: [casi] Washington Post 'No cronyism in Iraq'

>this article is a complete joke. For example, at the
beginning of the Gulf War I, nine members of the US
Administration had to be granted waivers for conflict of
interest because they were involved in companies trading
with Saddam Hussein. The US Admin operates a revolving
door between the multi nationals defense and industry
contractors and the people in office who set up the
policies that those contractors benefit from. Let's not
be naive, Philippa

===== Original Message From Eric Herring <> =====
>Washington Post article of interest 5 Nov 20-03
> No 'Cronyism' in Iraq
> By Steven Kelman
>    There has been a series of allegations and innuendos
>recently to the effect that government contracts for work
>in Iraq and Afghanistan are being awarded in an atmosphere
>redolent with the "stench of political favoritism and
>cronyism," to use the description in a report put out by
>the Center for Public Integrity on campaign contributions
>by companies doing work in those two countries.
> One would be hard-pressed to discover anyone with a
>working knowledge of how federal contracts are awarded --
>whether a career civil servant working on procurement or an
>independent academic expert -- who doesn't regard these
>allegations as being somewhere between highly improbable
>and utterly absurd.
> The premise of the accusations is completely contrary to
>the way government contracting works, both in theory and in
>practice. Most contract award decisions are made by career
>civil servants, with no involvement by political appointees
>or elected officials. In some agencies, the "source
>selection official" (final decision-maker) on large
>contracts may be a political appointee, but such decisions
>are preceded by such a torrent of evaluation and other
>backup material prepared by career civil servants that it
>would be difficult to change a decision from the one
>indicated by the career employees' evaluation.
>  Having served as a senior procurement policymaker in the
>Clinton administration, I found these charges (for which no
>direct evidence has been provided) implausible. To assure
>myself I wasn't being naive, I asked two colleagues, each
>with 25 years-plus experience as career civil servants in
>contracting (and both now out of government), whether they
>ever ran into situations where a political appointee tried
>to get work awarded to a political supporter or crony.
>"Never did any senior official put pressure on me to give a
>contract to a particular firm," answered one. The other
>said: "This did happen to me once in the early '70s. The
>net effect, as could be expected, was that this 'friend'
>lost any chance of winning fair and square. In other words,
>the system recoiled and prevented this firm from even being
>considered." Certainly government sometimes makes poor
>contracting decisions, but they're generally because of
>sloppiness or other human failings, not political
> Many people are also under the impression that contractors
>take the government to the cleaners. In fact, government
>keeps a watchful eye on contractor profits -- and
>government work has low profit margins compared with the
>commercial work the same companies perform. Look at the
>annual reports of information technology companies with
>extensive government and nongovernment business, such as
>EDS Corp. or Computer Sciences Corp. You will see that
>margins for their government customers are regularly below
>those for commercial ones. As for the much-maligned
>Halliburton, a few days ago the company disclosed, as part
>of its third-quarter earnings report, operating income from
>its Iraq contracts of $34 million on revenue of $900
>million -- a return on sales of 3.7 percent, hardly the
>stuff of plunder.
>  It is legitimate to ask why these contractors gave money
>to political campaigns if not to influence contract awards.
>First, of course, companies have interests in numerous
>political battles whose outcomes are determined by elected
>officials, battles involving tax, trade and regulatory and
>economic policy -- and having nothing to do with contract
>awards. Even if General Electric (the largest contributor
>on the Center for Public Integrity's list) had no
>government contracts -- and in fact, government work is
>only a small fraction of GE's business -- it would have
>ample reason to influence congressional or presidential
>  Second, though campaign contributions have no effect on
>decisions about who gets a contract, decisions about
>whether to appropriate money to one project as opposed to
>another are made by elected officials and influenced by
>political appointees, and these can affect the prospects of
>companies that already hold contracts or are
>well-positioned to win them, in areas that the
>appropriations fund. So contractors working for the U.S.
>Education Department's direct-loan program for college
>students indeed lobby against the program's being
>eliminated, and contractors working on the Joint Strike
>Fighter lobby to seek more funds for that plane.
> The whiff of scandal manufactured around contracting for
>Iraq obviously has been part of the political battle
>against the administration's policies there (by the way, I
>count myself as rather unsympathetic to these policies).
>But this political campaign has created extensive
>collateral damage. It undermines public trust in public
>institutions, for reasons that have no basis in fact. It
>insults the career civil servants who run our procurement
>  Perhaps most tragically, it could cause mismanagement of
>the procurement system. Over the past decade we have tried
>to make procurement more oriented toward delivering mission
>results for agencies and taxpayers, rather than focusing on
>compliance with detailed bureaucratic process requirements.
>The charges of Iraq cronyism encourage the system to revert
>to wasting time, energy and people on redundant,
>unnecessary rules to document the nonexistence of a
>  If Iraqi contracting fails, it will be because of poorly
>structured contracts or lack of good contract management --
>not because of cronyism in the awarding process. By taking
>the attention of the procurement system away from necessary
>attention to the structuring and management of contracts,
>the current exercise in barking up the wrong tree threatens
>the wise expenditure of taxpayer dollars the critics state
>they seek to promote.
> The writer is a professor of public management at Harvard
>University. He served from 1993 to 1997 as administrator of
>the Office of Federal Procurement Policy. He will answer
>questions about this column during a Live Online discussion
>at 2 p.m. today at
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