And Hedgpeth was right on the news that Representative Henry Waxman, chairman of the House Oversight and Government Reform Committee, believes Blackwater Security Consulting may be in some hot water on taxes for classifying as subcontractors workers who may in fact be employees.
[Waxman] said in a letter sent yesterday to the owner of Blackwater, Erik Prince, that panel staff members calculated that Blackwater may have avoided paying $31.8 million in Social Security, Medicare, federal income and unemployment taxes from May 2006 through March. In addition, Waxman said the company may owe another $18 million in taxes that it should have paid from April through September.
But it isn’t just Blackwater. In the past month, the Post also had a story on contracting gone wrong at Department of Health and Human Services. Renae Merle last Tuesday wrote about a Government Accountability Office report that revealed how the department wasted nearly $100 million worth of an anthrax vaccine.
The Post often does well by simply writing about government reports. There is nothing—nothing—wrong with this. We wish there were more of it.
Last week, there was news of a report, also released by the GAO, that the work of Homeland Security is carried out by layers of contractors. From the piece by Spencer S. Hsu:
At the Department of Homeland Security, contract employees help write job descriptions for new headquarters workers. Private contractors also sign letters that officially offer employment. And they meet new government hires on their first day on the job.
About the only thing they do not do, a critical new congressional audit concludes, is swear in DHS employees.
Across several of DHS’s most troubled projects, including delayed programs to replace the Coast Guard’s fleet and to issue secure credentials to port workers, contractors are so enmeshed in DHS’s work that they oversee other contractors. Some are assigned work that involves awarding future business, setting policy or drawing up plans and reorganizations, according to the Government Accountability Office, Congress’s audit arm.
These pieces on anthrax and homeland security contracting were little covered elsewhere.
That said, the author Naomi Klein delivered a thoughtful exploration of government contracting in an op-ed in last Saturday’s Los Angeles Times.
Her smart take may provide a framework to approach the coverage of government contracting in the final days of the Bush administration. After laying out dismal work by Boeing on a contract with the Department of Homeland Security to build the virtual fence along the U.S. borders with Canada and Mexico, Klein makes the point that the debacle points to more than faulty technology, but to the Bush administration’s radical vision of a hollowed-out government run everywhere possible by private contractors.
Such a “philosophy” explains statistics like this one: in 2003, the U.S. government handed out 3,512 contracts to companies to perform domestic security functions, from bomb detection to data mining. By August 2006, The Department of Homeland Security issued security-related contracts at a rate of 55,000 a year.
As President Bush’s former budget director, Mitch Daniels, put it: “The general idea — that the business of government is not to provide services but to make sure that they are provided — seems self-evident to me.”
Klein calls it government-as-ATM: contractors make deposits in the form of campaign contributions and withdraw massive contracts to perform core functions like securing borders and interrogating prisoners.
At this late hour in the Bush administration, no benefit of the doubt can be granted. This “philosophy” of government should be viewed as nothing more than an invitation to graft, dressed up with lipstick.
The business press has a lot to do these days, but government contracting should be a priority.