Contractor Nation

Forget a larger federal workforce-agencies can barely hire the employees they need to oversee contractors.

"The government functions better when government employees, not private contractors, perform its tasks," argued Moshe Adler, who teaches economics in the department of urban planning at Columbia University, recently in the Los Angeles Times. When a civil servant supervises a contractor, "the inclination to do an honest job may come into conflict with his personal interests," Adler wrote.

In this day and age, that's a pretty bold argument. Unfortunately, it's also rather limited. After all, in the majority of cases involving contract supervision, the inclination to do an honest job doesn't come into conflict with an employee's interests. Most employees either have integrity or don't have a conflict-or both.

Besides that, just because an employee doesn't have a self-interest in a situation doesn't mean he or she will do the best possible job for the taxpayer. Even federal operations that are squeaky clean might not be very efficient. Indeed, when federal employee teams are forced in A-76 competitions to devise "most efficient organizations" to compete against private firms for their jobs, most of the time they suddenly find ways to cut costs.

This is really an academic argument anyway. We as a nation have decided on a bipartisan basis that in general, we don't want a larger federal workforce to do the government's business. President Clinton drove the last nail into that coffin by making his effort to slash the federal workforce the centerpiece of his reinventing government campaign. It was part of his brilliant political tack to the center, and it was greeted with hardly a peep of dissent.

Now there's no organized constituency for a larger federal bureaucracy. There is only sporadic anger at the abuses of contractors and pockets of support on the right and the left for more federal employees to address crises. Of course, since 9/11, when such groups have made the case for bigger government, they haven't been shy about it. Witness the creation of the Transportation Security Administration and its tens of thousands of employees.

Or how about the recent efforts to beef up the federal presence on the southern border? In March, the Senate Judiciary Committee voted to add more than 10,000 customs and Border Patrol agents, 1,000 investigators and 1,250 port-of-entry inspectors over five years. Border Patrol officials had to point out that it would be virtually impossible to train so many new employees-the legislation would double the size of the current border force-using existing facilities.

As these examples show, the demand for government continues to rise unabated. But in many cases, even those involving sensitive security issues, agencies must turn to contractors to do the hands-on work. In mid-March, an official at the Customs and Border Protection bureau told legislators that the agency lacks sufficient inspectors to validate security plans for the 10,000 companies that have applied to be part of the Customs-Trade Partnership Against Terrorism program, and might need to rely on private companies to conduct the reviews.

The same week, The Washington Post reported that the Office of Director of National Intelligence John D. Negroponte has begun studying the issue of whether too many intelligence jobs are being outsourced. The rising rate of contracting out intelligence work, the paper reported, "is partly the result of Congress' approving large funding increases for intelligence activities but not increasing the limit on the number of full-time persons that agencies can hire."

Agencies frequently lack even sufficient personnel to oversee the contractors they've hired. The Government Accountability Office recently reported that shortages of oversight personnel at agencies responsible for the Hurricane Katrina response slowed projects and drove up the risk of poor contractor performance and overpayment for services.

The Justice Department's inspector general reported in March that as of January, the FBI office responsible for overseeing the Sentinel project to upgrade the agency's investigative systems-which itself was launched after contractors failed to deliver on the $170 million Virtual Case File system-had filled only 51 of 76 staff positions.

In his essay, Adler wrote, "All too often there is someone in the government who has both the power to decide on the contracts and a personal stake in the well-being of the contractor he supervises." Even more often, there is little or no contract supervision at all.

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