Tag Archives: Government

A Call To Action: Developing The Next Generation Of Federal Leaders



Photo: “IBM Center for the Business of Government “

Unlike corporate America and the military, which systematically groom their leaders from Day One, the federal government’s approach is generally uncoordinated across agencies and not well-informed by research or best practices.

Ensuring that new generations of federal leaders are prepared for the challenges we all know are on the horizon is vital to our national interests and the functioning of government.


“Developing the next generation of leaders for the federal government should be one of the highest priorities that Congress and federal agencies have. A new report finds that federal government agencies must increase efforts to prepare those leaders for the realities of a 21st century, which include unexpected and disruptive changes brought about by new technologies, changes in climate and demographics, and an uprooting of alliances and previously agreed upon social norms and practices.

The report — “Preparing the Next Generation of Federal Leaders: Agency-Based Leadership Development Programs,” released by the IBM Center for The Business of Government and co-authored by myself, James Perry from Indiana University, and Jenny Knowles Morrison and Gordon Abner of the University of Texas — found that there are some exemplar leadership development programs throughout government at agencies such as the Department of Defense, Department of Homeland Security and U.S. Department of Agriculture — but that such agency programs need to be expanded more widely.

Our report found that current programs “… are akin to having many different pilot programs convening simultaneously with neither a rigorous assessment of the effectiveness of those programs nor any coordinated effort to enhance next rounds of programming.”

This has consequences when public confidence in the federal government is at an all-time low.

“Just two-in-10 Americans say they can trust the government in Washington to do what is right ‘just about always’ (4 percent) or ‘most of the time’ (16 percent). Nearly seven-in-ten (68 percent) say they trust the government to do what’s right only some of the time and 11 percent volunteer the response that they never trust the government,” a 2017 Pew Foundation study found. This compares to the 1960s when 85 percent of Americans said they could trust the government to do the right thing.

Without career federal leaders in the executive branch being perceived as capable of navigating the complex and challenging environment the government operates within, the American taxpayer will continue to doubt whether government is delivering value to them. And for good reason — the U.S. government is the nation’s largest employer (2.6 million career civil servants) and those civil servants implement a $4.4 trillion annual budget that touches the lives of all Americans on a daily basis.

Effective leadership can help to increase public confidence that full value can be delivered to Americans for this enormous investment.

So we know the problem, but do we know the cure? The IBM Center report provides strong evidence that it is long past time to continue neglecting how we develop our leaders in the federal government and is a clarion call for action.

Like with the military and corporate America, the executive branch of the federal government needs a culture and practice of systematically developing leaders. Our study demonstrated that effective leadership development programs exist, and that if properly resourced and implemented will produce the talented career leaders our government requires.

The report contains many recommendations, including identifying the factors that enable successful leadership development programs to thrive in the federal government.

Our most important recommendation is to stop treating developing our next generation of leaders as an afterthought and accept that this is a national priority of the highest order.

Retirements among baby boomers are accelerating and government is having a tough time attracting new generations to government service (only 6 percent of the current workforce is under the age of 30).”



Bill Valdez is president of the Senior Executives Association, the professional association for career members of the Senior Executive Service (SES) and equivalent positions.

It’s Time to Stop Stuffing the Defense Budget




THE PROJECT ON GOVERNMENT OVERSIGHT (POGO) From the Article, “Bestselling Pentagon Fiction”

For the Pentagon, happy days are here again (if they ever left). With a budget totaling more than $1.4 trillion for the next two years, the department is riding high, even as it attempts to set the stage for yet more spending increases in the years to come.”


“With such enormous sums now locked in, Secretary of Defense (and former Raytheon lobbyist) Mark Esper is already going through a ritual that couldn’t be more familiar to Pentagon watchers. He’s pledged to “reform” the bureaucracy and the spending priorities of the Department of Defense to better address the latest proposed threats du jour, Russia and China. His main focus: paring back the Pentagon’s “Fourth Estate” — an alphabet soup of bureaucracies not under the control of any of the military services that sucks up about 20% of the $700 billion-plus annual budget.

Esper’s promises to streamline the spending machine should be taken with more than the usual grain of salt. Virtually every secretary of defense in living memory has made similar commitments, with little or nothing to show for them in terms of documented savings. Far from eliminating wasteful programs, efforts pursued by those past secretaries and by Congress under similar banners have been effective in only one obvious way: further reducing oversight and civilian control of the Pentagon rather than waste and inefficiency in it.

Examples of gutting oversight under the guise of reform abound, including attempting to eliminate offices focused on closing excess military bases and sidelining officials responsible for testing the safety and effectiveness of weapon systems before their deployment. During the administration of President Bill Clinton, for instance, the slogan of the day — “reinventing government” — ended up, in Pentagon terms, meaning the gutting of contract oversight. In fact, just to repair the damage from that so-called reform and rebuild that workforce took another $3.5 billion. Gordon Adams, former associate director for national security and international affairs at the White House Office of Management and Budget, noted accurately that such efforts often prove little more than a “phony management savings waltz.”

Secretary of Defense Esper has also pledged to eliminate older weapons programs to make way for systems more suited to great power conflict. Past efforts along these lines have meant attempts to retire proven, less expensive systems like the A-10 “Warthog” — the close-air-support aircraft that protects troops in combat — to make way for the over-priced, underperforming F-35 jet fighter and similar projects.

Never mind that a war with either Russia or China — both nuclear-armed states — would be catastrophic. Never mind that more effort should be spent figuring out how to avoid conflict with both of them, rather than spinning out scenarios for fighting them more effectively (or at least more expensively). Prioritizing unlikely scenarios makes for a great payday for contractors, but often sacrifices the ability of the military to actually address current challenges. It takes the focus away from effectively fighting the real asymmetric wars the U.S. has been fighting since World War II. It leaves taxpayers with massive bills for systems that almost invariably turn out to be over cost and behind schedule. Just as an infamous (and nonexistent) “bomber gap” with the Soviet Union was used by the Pentagon and its boosters to increase military spending in the 1950s, the current hype around ultra-high-speed, hypersonic weapons will only lead to sky’s-the-limit expenditures and a new global arms race.

Esper’s efforts may end up failing even on their own narrow terms. Reforming the Pentagon is hard work, not only because it’s one of the world’s largest bureaucracies, but because there are far too many parochial interests that profit from the status quo. Under the circumstances, it matters little if current spending patterns aren’t aligned with any rational notion of what it would take to defend the United States and its allies.

A Revolving-Door World

The Department of Defense regularly claims that it has implemented “efficiencies” to ensure that every penny of your tax dollars is being wisely spent. Such efforts, however, are little more than marketing ploys designed to fend off future calls for cuts in the Pentagon’s still-ballooning budget. Here are just two recent examples of this sadly familiar story.

In September 2018, the Government Accountability Office (GAO) released a report stating that the Department of Defense had provided insufficient evidence that $154 billion in alleged “efficiency savings” from fiscal years 2012 to 2016 had been realized; the department claimed credit for them anyway.

Just this month, the GAO came to a similar conclusion regarding a proposed Pentagon reform plan that was to save $18.4 billion between fiscal years 2017 and 2020. Its report stated that the Pentagon had “provided limited documentation of… progress,” which meant the GAO “could not independently assess and verify” it. Consider that a charitable way of suggesting that the Department of Defense was once again projecting a false image of fiscal discipline, even as it was drowning in hundreds of billions of your tax dollars. The GAO, however, failed to mention one crucial thing: even if those alleged savings had been realized, they would simply have been plowed into other Pentagon programs, not used to reduce the department’s bloated budget.

Esper and his colleagues have argued that it will be different this time. In an August 2nd memo, his principal deputy, David Norquist, stated that “we will begin immediately and move forward aggressively… The review will consider all ideas — no reform is too small, too bold, or too controversial to be considered.”

Even if Esper and Norquist were, however, to propose real changes, they would undoubtedly run into serious interference within the Pentagon, not to mention from their commander-in-chief, President Donald Trump, a man determined to plough ever more taxpayer dollars into the military, and from members of Congress in states counting on jobs generated by the military-industrial complex. Inside the Pentagon, on the other hand, resistance to change will be spearheaded by officials who previously held jobs in the defense industry or hope to do so in the future. We’re talking, of course, about those who have made use of, or will make use of, the infamous “revolving door” between weapons companies and the government. Consider that the essence of the military-industrial complex in action.

Such ties start at the top. During the Trump administration, the post of secretary of defense has been passed from one former defense industry figure to another, as if it were literally reserved only for key officials from major weapons makers. Trump’s first secretary of defense, retired General James (“Mad Dog”) Mattis, came to the Pentagon straight from the board of General Dynamics, a position he returned to shortly after leaving the department. Interim Secretary Patrick Shanahan, who followed him, had been an executive at Boeing, while current Secretary Esper was Raytheon’s former chief in-house lobbyist. The Pentagon’s number three official, John Rood, similarly comes courtesy of Lockheed Martin. And the list only goes on from there.

This has been a systemic problem in Democratic and Republican administrations, but there has been a marked increase in such appointments under Donald Trump. A Bloomberg Government analysis found that roughly half of the Obama administration’s top Pentagon officials had defense contractor experience. In the Trump administration, that number has reached a startling 80%-plus.

That revolving door, of course, swings both ways. Defense executives come into government, where they make decisions that benefit their former colleagues and companies. Then, as retiring government officials, they go to work for defense firms where they can use their carefully developed government contacts to benefit their new (or old) employers. This practice is endemic. A study by the Project On Government Oversight found 645 cases in which the top 20 defense contractors hired former senior government officials, military officers, members of Congress, or senior legislative staff as lobbyists, board members, or senior executives in 2018 alone.

There is, of course, nothing new about any of this. The late Senator William Proxmire (D-WI) pinpointed the problem with the revolving door back in 1969:

“The easy movement of high-ranking military officers into jobs with major defense contractors and the reverse movement of top executives in major defense contractors into high Pentagon jobs is solid evidence of the military-industrial complex in operation. It is a real threat to the public interest because it increases the chances of abuse… How hard a bargain will officers involved in procurement planning or specifications drive when they are one or two years from retirement and have the example to look at over 2,000 fellow officers doing well on the outside after retirement?”

Such revolving-door hires and former defense executives in government remain a powerful force for the status quo in Pentagon spending. They exert influence as needed to keep big-ticket weapons programs like the F-35 combat aircraft up and running, whether they are needed or not, whether they work as promised or not.

For his part, President Trump has repeatedly bragged about his role in promoting defense-related employment in key states, both from Pentagon budget increases and the sale of arms to repressive regimes like Saudi Arabia. In March, he held a one-hour campaign-style rally for workers at a tank plant in Lima, Ohio, at which he typically suggested that his budget increases had saved their jobs.

As for Congress, when the Army, in a rare move, actually sought to save a modest amount of money by canceling an upgrade of its CH-47 transport helicopter, the Senate struck back, calling for funding that the Pentagon hadn’t even requested in order to proceed with the program. The reason? Protecting jobs at Boeing’s Philadelphia-area factory that was scheduled to carry out the upgrades. Unsurprisingly, Trump seems fine with this congressional initiative (affecting the key battleground state of Pennsylvania), which still needs to survive a House-Senate conference on the defense bill.

The bottom line: Donald Trump is likely to oppose any changes that might have even the smallest impact on employment in states where he needs support in election campaign 2020. Defense industry consultant Loren Thompson summed up the case as follows: “We’re too close to the presidential election and nobody [at the White House] wants to lose votes by killing a program.” And keep in mind that this president is far from alone in taking such a stance. Similar reelection pressures led former President Jimmy Carter to increase Pentagon spending at the end of his term and caused the George H. W. Bush administration to reverse a decision to cancel the troubled V-22 Osprey, a novel part-helicopter, part-airplane that would later be implicated in crashes killing dozens of Marines.

“We Won’t Get Fooled Again”

What would a genuine Pentagon reform plan look like? There are areas that could easily yield major savings with sufficient political will and persistence. The most obvious of these might be the Pentagon’s employment of more than 600,000 private contractors, many of whom do jobs that could be done by government civilians for less. Cutting that work force to “only” about half a million, for example, could save more than a quarter of a trillion dollars over the next decade, as noted in a recent report by the Center for International Policy’s Sustainable Defense Task Force (of which both authors of this article were members).

Billions more could be saved by eliminating unnecessary military bases. Even the Pentagon claims that it has 20% more facilities than it needs. A more reasonable, restrained defense strategy, including ending America’s twenty-first-century forever wars, would make far more bases redundant, both at home and among the 800 or so now scattered around the planet in an historically unprecedented fashion. Similarly, the president’s obsession with creating an expensive Space Force should be blocked, given that it’s likely only to increase bureaucracy and duplication, while ensuring an arms race above the planet as well as on it.

Real reform would also mean changing how the Pentagon does business (not to speak of the way it makes war). Such savings would naturally start by simply curbing the corruption that comes from personnel in high positions who are guaranteed to put the interests of defense contractors ahead of those of taxpayers and the real needs of American security. (There are also few restrictions on former officials working for foreign governments and almost no public disclosure on the subject.) The Project On Government Oversight found hundreds of Pentagon officials leaving for defense industry jobs, raising obvious questions about whether decisions they made were in the public interest or meant to advance their own future paydays.

Real reform would close the many loopholes in current ethics laws, extend cooling-off periods between when an official leaves government and when he or she can work for an arms contractor, and make far more prominent information about when retired national security officials switch teams from government to industry (or vice versa). Unfortunately, since Esper himself has refused to pledge not to return to the world of the corporate weapons makers after his stint as secretary of defense, this sort of reform will undoubtedly never be part of his “reform” agenda.

One outcome of his initiative, however, will definitely not be money-saving in any way. It will be to boost spending on high-tech systems like missile defense and artificial intelligence on the almost laughable grounds (given the past history of weapons development) that they can provide more military capability for less money. Whether you look at the Navy’s Ford aircraft carriers — the first two costing $13.1 billion and $11.3 billion — or the Air Force’s aerial refueling tanker (which has taken nearly two decades to procure), it’s not hard to see how often vaunted technological revolutions prove staggeringly costly — far, far beyond initial estimates — yet result in smaller, less effective forces. As longtime Pentagon reformer Tom Christie has pointed out, to really change the acquisition system would require building in significantly more discipline. That would mean demonstrating the effective and reliable use of new technology through rigorous field-testing before advancing fragile weapons systems to the production stage, ensuring future maintenance and other headaches for troops in combat.

There is, in addition, a larger issue underlying all this talk of spending reform at the Pentagon. After all, Esper’s “reforms” are visibly designed to align Pentagon spending with the department’s new priority: combatting the security challenges posed by Russia and China. Start with one crucial thing: these challenges have been greatly exaggerated, both in the Trump administration’s national defense strategy and in the report of the industry-led National Defense Strategy Commission. That document, when you analyze its future math, even had the nerve to claim that the Pentagon budget would need to be boosted to nearly $1 trillion annually within the next five years, reports Taxpayers for Common Sense.

Russia has much to answer for — from its assistance to the Syrian army’s ongoing slaughter of civilians to its military meddling in the affairs of Ukraine — but the response to such challenges should not be to spend more on ships, planes, and advanced nuclear weapons, as current Pentagon plans would do. In reality, the economy and military of Russia, a shaky petro-state only passing for a great power, are already overshadowed by those of the U.S. and its NATO allies. Throwing more money at the Pentagon will do nothing to change Russian behavior in a positive fashion. Taking measures that are in the interests of both countries like renewing the New START nuclear reduction treaty and beginning new talks on curbing their massive nuclear arsenals would be extremely valuable in their own right and might also open the door to negotiations on other issues of mutual concern.

China’s challenge to the U.S is significantly more economic than military and, if those two nations wanted to make the planet a safer place, they would cooperate in addressing the threat of climate change, not launch a new arms race. Genuine reform of the Pentagon’s massive budget is urgently needed, but rest assured that Secretary of Defense Esper’s claims about implementing real changes to save taxpayer dollars while making the U.S. military more effective are the equivalent of bestseller-list Pentagon fiction. The motto of Congress, not to speak of the White House and the public, with respect to the Pentagon’s latest claims of fiscal probity should be “we won’t get fooled again.”


DOD Audit Uncovers Millions Of Dollars In Unaccounted-For Spare Parts

Image: Performcoat.com


“The Defense Department is just starting its second year of full-scale financial audits, and it’s likely to take many more before those efforts yield a clean opinion.

In the first year of the full-scope examination, auditors issued more than 170 separate findings and recommendations detailing the military services shortcomings in tracking their small-item inventory and real estate. “


“But the process is already having at least one beneficial effect: It’s pushed the military services to account for tens of millions of dollars in government property they’d lost track of.

David Norquist, DoD’s CFO and comptroller, said progress along those lines has already delivered concrete proof for why the audit is not merely a paperwork drill.

“We discovered there are certain facilities where what they thought they had in inventory did not match what they had in inventory. And if your responsibility is spare parts for airplanes, the accuracy of that inventory matters,” he told the Senate Armed Services Committee last week.

One example was how, at Utah’s Hill Air Force Base, a stockpile of missile motors was erroneously listed as unserviceable even though they were in perfectly good condition. Putting them back into circulation instead of ordering new ones saved the Air Force $53 million.

“In other places, if you go to Osan and Kadena [air bases in Japan], they had 14,000 munitions worth $2.2 billion, and 100 percent were accounted for — not a single exception,” Norquist said. “What we’ve learned is there are some places that are doing this quite well, and there are others where we need to help them fix their processes, but the commanders in the field recognize the direct connection to mission and readiness. They saw the tangible value, and I think as we move forward, the accuracy of the data and adopting more businesslike practices will be tremendously helpful.”

Facilities ‘no one knew existed’

Instances of bad or missing data about entire warehouses worth of parts came up more than once during the course of the 2019 audit.

Thomas Modly, the undersecretary of the Navy, said the Navy found something similar when its auditors began examining a facility in San Diego.

“When we went out and actually started counting inventory and understanding where our stuff was, they found a warehouse that no one knew existed, and it had $26 million worth of parts for the E-2 and the F-18,” he said. “It was not categorized. It did not sit on any inventory system that we had in the whole Department of the Navy. Once that was identified, we were able to requisition $19 million worth of parts to aircraft that were waiting for them and were down because we didn’t even know we had those parts. This is a serious problem for us that we really have to get after, because at the end of the day, it impacts our ability to perform the mission, and our costs.”

The DoD Inspector General reported similar issues in its summary of the 2019 audit findings. More than 100 Blackhawk helicopter blades that were listed as available for use, but that were actually damaged. Fuel injectors stored in warehouses with no documentation to show which military service owned them. Entire facilities that had been demolished years ago, but are still listed as active on the military’s property books.

The IG reported 20 overall material weaknesses after the first audit, and then refined the list down to six that auditors thought were most concerning. Two of the six had to do with property — one encompassed spare parts and other inventory, while the other dealt with bigger-ticket items like real estate.

“We’ve gone out and said, ‘Give us a list of a certain asset and how many you have and where they’re located.’ And when we go, we either find that they have more than they thought, or the ones on their lists don’t exist,” said Carmen Malone, the deputy assistant inspector general for audit. “If you have something in your inventory records that actually can’t be used, you’re not going to order something, because you think you already have it. From an inventory standpoint, that is a big deal.”

Malone said one of the reasons the IG considers the property issue so serious is that it has a direct bearing on military readiness.

“It’s not just from a financial statement standpoint,” she said. “We are out talking to the everyday operating people and making sure that they understand that what they do impacts not just the financial statements. This information will be used as a central location for decision makers across the department from a readiness and logistics standpoint as well. If the information is accurate for financial statements, it’s going to be accurate for the decision makers, which ultimately affects the operations and readiness of the department.”

At last week’s hearing, Norquist declined to predict when the department will finally earn a clean opinion on its full financial statement, but he said he expected that either the Army or the Marine Corps would pass an audit of a small portion of their individual statements — namely,  their working capital funds — within the “next couple years.”

But Modly said his department has major, systemic challenges it still needs to solve with its accounting systems before audit passage is a reasonable probability — at least on an ongoing, repeatable basis.

“We have nine current general ledger systems. They’re not connected, and they create all kinds of disparities in our ability to truly understand our financial information,” he said. “We have business systems that are even more complicated that require interfaces that cause breaks in data security. Because of all those problems, we’re doing a lot of estimating, a lot of hand-jamming of information that most modern industrial corporations never have to do. Most modern industrial corporations can push a button and generate a financial report. We are not even close to that, and we have to get better.”


Foreign Influence at the Witness Table?


Foreign Influence at the Witness Table

Illustration by POGO


“A POGO investigation has found numerous loopholes that keep Congress and the public in the dark about the extent of foreign governments’ financial relationships with Congressional witnesses.

Some think tanks had been receiving millions in funding from foreign governments, with little or no disclosure.”

“On any given day, it’s not uncommon to see experts from various Washington, DC, think tanks testify at Congressional hearings. On everything from Middle East policy to nuclear nonproliferation, Congress relies on these experts to provide outside input and help shape future U.S. policy.

The House of Representatives had adopted the rule, which obligates non-governmental Congressional witnesses to disclose foreign funding when it relates to the subject of the hearing at which they’re testifying, after multiple investigations revealed some think tanks had been receiving millions in funding from foreign governments, with little or no disclosure.

Representative Jackie Speier (D-CA) proposed the rule change in response to a 2014 New York Times investigation by Eric Lipton, Brooke Williams, and Nicholas Confessore, which detailed the extent of foreign government donations to prominent DC think tanks. The piece highlighted questions about whether such organizations would be required to disclose those relationships under the Foreign Agents Registration Act (FARA), a law that requires foreign lobbyists and public-relations managers to register with the Department of Justice.

The Times investigation elevated concerns raised in a 2007 Harpers exposé by Ken Silverstein (who is now a journalist in residence at POGO). After the Times story, lawmakers grew increasingly concerned that think tanks might be pushing the perspectives or agendas of their foreign funders without disclosing the relationship.

“While this funding may not distort the testimony of these witnesses, this financial support should be disclosed for Members to appropriately assess potential conflicts,” Representative Speier stated.

All non-governmental witnesses are required to file Truth In Testimony forms disclosing specific information about any U.S. government grants or contracts they have received. The 2015 House rule simply added a requirement that such witnesses also disclose any grants or contracts they or their organization have received in the last two years from a foreign government related to the subject of the hearing. That wording is weaker than Representative Speier intended, as what is related to the hearing can be subjective and compounds the bias problems inherent to self-reporting. Furthermore, the House Rules Committee has issued guidance to some think tanks that if their experts are invited to testify as individuals rather than as representatives of the organization, they do not have to disclose the institution’s funding. This creates a huge loophole in the disclosure requirement. And, aside from the threat of a specific member making a critical statement on the House floor, there is no penalty for those who violate the rule.

The names of some of the biggest DC think tanks are synonymous with independent, fact-based research and writing. However, there is no requirement for think tanks to disclose their funders, foreign or otherwise, to the public, which makes it difficult to know who has a stake in their work.

When these think tanks do disclose their funders, the U.S. government and foreign governments appear as top-tier donors. Those relationships can create at least the appearance of a conflict of interest when the organization is issuing recommendations on foreign policy, underscoring the importance of transparency on funding sources when working to affect U.S. policies.

To determine if the rule works as intended to capture how foreign-government donations to think tanks could color the analysis of Congressional witnesses, POGO reviewed Truth in Testimony forms filed by non-governmental witnesses appearing before three House committees. POGO examined all publicly available forms filed by witnesses appearing before the Foreign Affairs, Armed Services, and Appropriations committees, due to those committees’ focus on international issues as well as U.S. national security.

It is ultimately the responsibility of each committee to ensure that non-governmental witnesses are complying with the rule and disclosing properly. But how think tanks comply with the rule demonstrates that it falls short of truly requiring the disclosure of all potential foreign conflicts of interest.

Ambiguity in Self-Reporting Creates Unintended Loophole

The House rule requires witnesses to disclose “any Federal grants or contracts, or contracts or payments originating with a foreign government, received during the current calendar year or either of the two previous calendar years by the witness or by an entity represented by the witness and related to the subject matter of the hearing.” POGO’s review shows that some expert think-tank witnesses use a very narrow definition of “related.”

For example, in reviewing forms filed by Atlantic Council experts testifying before the House Foreign Affairs, Armed Services, and Appropriations committees, POGO found that none included any disclosure of foreign funding related to the subject of the hearing.

There is more to the story, though. In its 2017-2018 annual report, the Council, which describes itself as “a nonpartisan group of foreign policy change-makers,” lists over a dozen foreign governments or foreign-government-owned companies as major donors of $25,000 per year or more. In fact, the government of the United Arab Emirates (UAE) donated at least one million dollars to the Council in 2017, more than any branch of the U.S. government did. A conservative estimate of all of the Atlantic Council’s foreign-government donations for 2017-2018 would be approximately $2,585,000, based on the low end of the stated ranges, but one might not know that by just looking at the organization’s Truth in Testimony forms.

In some instances, that foreign funding could be relevant to a hearing’s subject, even if the country of origin is not directly named. For instance, testimony on “Reforming the National Security Council” or “Defeating Terrorism in Syria” may not directly relate to any of the Council’s numerous foreign donors, but some who give money would have an interest in the outcome. The UAE certainly has an interest in Syria, having been involved in supporting both sides of the Syrian civil war. Further, none of the Truth in Testimony forms filed by Atlantic Council witnesses disclose any federal grants or contracts, even though the organization’s annual report lists six U.S. government offices as major donors, including every military branch.

Testimony from the Center for Strategic and International Studies (CSIS) demonstrates how the rule does not fully capture instances where foreign donors could have interests in U.S. policies. CSIS describes itself as “a bipartisan, nonprofit policy research organization dedicated to providing strategic insights and policy solutions to help decisionmakers [sic] chart a course toward a better world.” Part of that mission includes testifying before Congress: CSIS representatives testified before the House Committee on Foreign Affairs 21 times between 2016 and 2018.

Out of those 21 instances, 14 of the experts reported no funding from foreign governments related to the topic of the hearing. In six instances, witnesses reported relevant funding (one witness form was missing). The disclosure forms vary in the details of the amounts and sources of funding, but they show that Asian countries have invested significantly in CSIS’s work. CSIS did regularly disclose details of its foreign funding, and unlike the forms filed by some other think tanks, it is possible to get a picture of CSIS’s foreign funding from these forms alone. However, the disclosures do not fully comply with the rule because they failed to break out the amounts by country, instead lumping all relevant foreign contributions together.

“We see congressional testimony as an opportunity to help members of Congress think more strategically about the global environment and full transparency is an important part of that process,” a CSIS spokesman told POGO.

In 2016, the organization reported a $43.8 million operating revenue, with 27 percent of that funding coming from “government,” but it’s one of many think tanks that only provide general information on the sources of their funding. The ranges of funding reported are unusually broad, including all donations between $5,000 and $99,999 in one range before jumping to $100,000-$499,999 and finally to $500,000 and above. A conservative estimate of all CSIS’ foreign-government donations for 2017-2018 would be approximately $1,930,000. One 2016 form states that the organization received $1,739,500 from the governments of Japan, Taiwan, and Vietnam since 2014.

Many of CSIS’s top-tier government funders are Asian or Middle Eastern countries, including Japan, Taiwan, United Arab Emirates, South Korea, and Turkey—some of which might have an interest in hearings such as “Iranian Backed Militias: Destabilizing the Middle East,” at which Melissa Dalton, CSIS senior fellow and deputy director of its International Security Program, testified in 2017. Furthermore, several CSIS witnesses participating in other hearings related to Asian countries or issues, like “U.S.-India Relations” or North Korean diplomacy, checked “no” to having received donations from foreign governments related to the subject of the hearing. Though not required to be disclosed under the current House rule, these funders may have an interest in developing certain narratives about those regions.

Some of the hearings CSIS employees testified at were about broad topics like “opportunities in defense reform” or space warfare, which could touch on many different foreign interests but would likely not require disclosure under the House rule.

Other examples introduce further complications. For example, Andrew Shearer, then senior advisor on  Asia-Pacific security at CSIS, testified at a 2017 hearing about “The Evolution of Hybrid Warfare and Key Challenges.” His testimony details the Chinese hybrid warfare strategy and China’s role in the Asia-Pacific region. And William A. Carter, CSIS fellow and deputy director its Technology Policy Program, testified in 2018 on “China’s Pursuit of Emerging and Exponential Technologies.” Yet there was no Truth in Testimony form posted for either expert. The CSIS website states that China donates between $5,000 and $99,999 to the organization.

But even if the forms were posted, it’s unclear if the financial relationship would have needed to be disclosed. CSIS told POGO it wasn’t a typical grant or donation. “We do not take Chinese government or Chinese corporate money to do policy research at CSIS. We had one visiting fellow from a Chinese government-associated institution with our China program in 2017, which is why there is a listing that references China on our website,” a CSIS spokesman told POGO. “There is absolutely zero ‘Chinese influence’ over CSIS testimony, events, publications, or programming.” The House Rules Committee should make clear if such an arrangement is covered under the “grants or payments” language in the rule and therefore if this kind of relationship is required to be disclosed.

Letting think tanks decide for themselves if a donor is relevant to the subject of the hearing can allow for an overly narrow interpretation of the rule—a determination that is particularly hard to make when a hearing is globally or regionally focused.

The Personal Capacity Loophole

Some think-tank experts distance themselves from their organization’s foreign donors by saying their testimony and statements represent their personal views and not those of their organization. For example, witnesses associated with the Brookings Institution testified before the House Foreign Affairs Committee seven times between 2016 and 2018, and in all but one case the witnesses responded “yes” to having accepted money from foreign governments. All witnesses affiliated with the think tank handled the disclosure in the same way. Each Truth in Testimony form filed by a Brookings witness includes a link to reports that outline Brookings’ donors and a statement reading:

Consistent with the Brookings Institution’s commitment to independence (which includes not taking Institutional positions on issues), I am hereby informing the Committee that my testimony represents my personal views and does not reflect the views of Brookings, its other scholars, employees, officers, and/or trustees[…] Furthermore, out of an abundance of caution, I have affirmatively responded to questions 5 and 6 above [the questions asking if the organization received U.S. or foreign government funding], in the event that some of the donors disclosed above are responsive to these questions.

Although the rule explicitly states that disclosures must include payments received “by the witness or by an entity represented by the witness,” some House committees seem to accept the distinction between individual experts and their parent organizations as a reason not to require disclosures. A Brookings Institution spokeswoman told POGO that the organization developed its disclosure language in consultation with the House Rules Committee when the rule was first enacted.

The donor information Brookings links to in the disclosure form provides some detail but wouldn’t actually satisfy the requirements of the rule if disclosure were required. All of Brookings’ financial disclosures are broken down in ten ranges, starting with “up to $4,999” and culminating in “$2,000,000 and above.” Based on these ranges, a conservative estimate of all of Brookings’ foreign-government donations for the first half of fiscal year 2018 would be approximately $3,750,000.

While the Institution and those witnesses who are affiliated with it view their statements and testimony as separate from the views of Brookings itself, that may not be clear to Members of Congress or the public. The notion that they are separate is particularly at odds with how the witnesses are introduced and given credibility based on their position and work with the Institution. In several instances, Brookings-affiliated witnesses referenced Brookings reports or work in their testimony, and they were almost always introduced with their Brookings titles. In some cases, these hearings were directly related to Brookings’ foreign-government donors, such as Brookings Senior Fellow and Center for the U.S. and Europe Director Dr. Thomas Wright’s testimony at a hearing on Brexit the same year the organization received money from the United Kingdom.

The Brookings Institution is far from the only organization to claim this separation. For instance, Atlantic Council Senior Fellow and Strategist Naz Durakoglu presented testimony at a House Foreign Affairs hearing called “Turkey’s Democracy Under Challenge” in 2017. Durakoglu’s written testimony states that “The Atlantic Council takes no institutional positions on policy issues,” and that the information contained in her testimony represents her views alone. But the Council does have a financial relationship with Turkey. The organization’s last annual report lists Turkey’s Prime Ministry Investment Support and Promotion Agency as a $25,000-$49,999–tier donor.

“The expert was not aware at [the] time of completing the form of Turkish funding, and worked in a group that was not connected with any funding from Turkey,” an Atlantic Council spokesperson told POGO.

The Rules Committee provided further clarification. A spokesman told POGO that the requirement to disclose or not actually comes down to how the invitation to testify is worded. If the invitation specifically asks for an expert to testify in an individual capacity then they do not need to disclose the funding sources of their parent organization.

Allowing witnesses to testify in an individual capacity, and therefore not disclose potential conflicts, while maintaining the prestige and credibility that comes with being affiliated with an organization like Brookings or the Atlantic Council, is a huge loophole in the rule. The intent of the rule is to provide transparency into any relationships that may color the analysis presented in Congressional testimony. Regardless of the capacity in which an individual is testifying, they should be disclosing the financial relationships of their current employer.

The Brookings Institution told POGO that its foreign donors have no say in what it publishes and it takes a number of steps to prevent potential conflicts of interest. “No single donor is responsible for more than 5% of our funding,” a Brookings spokeswoman told POGO. “Less than 10% of Brookings’s funding comes from foreign governments, and these donations go through the same review process as all other donations of similar value.”

While that may be true, the public and Members of Congress should be able to see those numbers for themselves when Brookings experts are helping to shape policy. Think-tank witnesses are undoubtedly issue-area experts who should be called upon to share their knowledge and help Congress make informed decisions. But the failure to require full disclose of relationships that could in any way influence not only the content of the remarks but the perception of independence in the witnesses themselves, should raise concerns that the rule does not go far enough.

Poor Compliance by Key Committees

In POGO’s review of how the House Foreign Affairs, Armed Services, and Appropriations committees enforced the Truth in Testimony disclosure rule, we found that in addition to the problems with the rule itself, compliance with the rule as it currently exists was spotty at best, and some committees did not fully adhere to the rule’s requirements.

POGO found:

  • The House Committee on Foreign Affairs had by far the most non-governmental witnesses. Approximately 10 percent of those witnesses did not file the required form and 77 percent filed the form but said they had not received foreign funding related to the subject of the hearing.
  • The House Committee on Armed Services had the fewest publicly available disclosures. Approximately 77 percent of Armed Services non-governmental witnesses from 2016-2018 did not have any Truth in Testimony forms publicly available at all.
  • The House Committee on Appropriations had the fewest non-governmental witnesses testify during the period. Approximately 26 percent of those witnesses did not file the form as required and only seven witnesses, or four percent, answered yes to the question asking if they received foreign funding. Of those seven witnesses who answered affirmatively, only three disclosed the actual funding details as required.

Particularly of note, the House Armed Services Committee told POGO that it had not posted all the forms it received. The rule specifically requires the forms to “be made publicly available in electronic form not later than one day after the witness appears.” The Armed Services Committee retroactively posted at least three of the disclosure forms after POGO’s request for comment, though a recent staffing change made locating all the missing forms more difficult, a Committee spokesman told POGO.

On the other hand, the Foreign Affairs Committee has strengthened the rule to require further transparency. Its form also asks witnesses to disclose if they are an active registrant under FARA, which requires those representing the interests of foreign governments or political parties to register with the Department of Justice. Although the Justice Department keeps public records of all registrants under the Act, this additional disclosure makes it easier for Committee members and the public to see if witnesses are foreign agents.

POGO only found one Foreign Affairs witness who answered “yes” to being a FARA registrant. Mehmet Yuksel, representing the People’s Democratic Party in Turkey, answered affirmativelywhen he testified on Turkey’s democracy. In 2012, Yuksel registered under FARA for his work promoting information on democracy and human rights in Turkey and Kurdistan.


Non-governmental witnesses are a vital part of the Congressional hearing process and many of those representing or affiliated with think tanks have spent their lives studying and learning the intricacies of their subject matter. Congress should value and utilize their expertise. Furthermore, just because their organizations receive foreign funding does not necessarily mean they are agents of foreign governments sent to infiltrate the U.S. policy making process. Indeed, each think tank mentioned in this piece told POGO that they maintain independence from their foreign donors and have robust conflict-of-interest policies in place.

Still, many of the biggest and most influential think tanks paint a picture of themselves as un-influenced and unbiased ivory towers of information without disclosing much, if any, information about how they maintain multimillion-dollar operating budgets. Most of the time, this lack of specificity in disclosing financial relationships with foreign governments is intentional, and should raise conflict-of-interest concerns when the mission of the organization is to affect policy decisions. There’s no requirement for think tanks or nonprofits to publicly disclose their funding sources, which is why the Truth in Testimony rule is so important. Congress is besieged by special-interest representatives, lobbyists, and “consultants” every day. Understanding who has an interest in the information presented is necessary to making informed decisions.

Require Senate witnesses to file Truth in Testimony forms. Currently the Truth in Testimony rule only applies to nongovernmental witnesses appearing before House Committees. There is no similar rule in the Senate despite the same concerns being present. The Senate should adopt the (ideally updated) House rule to ensure their witnesses disclose any potential conflicts of interests with foreign governments.

Expand the rule to cover all foreign funding, not just that directly related to the subject of the hearing. While the law covers the most direct conflict-of-interest concerns related to foreign governments, it fails to fully capture the world of foreign influence. Many foreign governments, particularly those shelling out millions to think tanks, have vested interests in U.S. posture toward their regions more broadly as well as general U.S. policies on defense, aid, and investment. Non-governmental witnesses should be required to disclose the nature of their relationship with all their foreign donors to prevent even the appearance of a conflict.

Institute a penalty for those who do not comply with the rule. Currently there is not a strong enforcement mechanism to ensure think-tank experts and other non-governmental witnesses are complying with the rule. If a Committee discovers a witness has violated the rule, the expert should be barred from testifying again before Congress.

Eliminate the personal-capacity loophole. Each House committee should enforce the rule to require all non-governmental witnesses to disclose their employer’s financial ties regardless of the capacity in which they are testifying. The purpose of this rule is to ensure transparency in the information Congress is receiving. There should be no loophole around this disclosure.”


Managing Subcontractors And Independents As A Small Business Prime Contractor



Image:  Contractorsupportnetwork.com

SMALLTOFEDS”  By Ken Larson 

“Industry teaming is a fact of life in small business federal government contracting. Your team for a given contract pursuit may consist of several types of industry partners external to your organization.

If you are the business lead by virtue of teaming agreements that recognize your small business set-aside designation as the qualifier for leadership, you have a management challenge. That challenge involves issuing agreements and purchase orders to independent contractors as individuals and negotiating fully executed subcontracts with firms subcontracting to you. 

The techniques in managing each of these partner types are distinct. The contractual and regulatory factors are introduced in the following link:

What is a Small Business Federal Government Contractor

This article will convey guidance for a small business federal government prime contractor, in managing the external business relationships with other companies as subcontractors and independents as individuals.


Finding industry teaming partners should occur synonymous with finding an opportunity. We have previously discussed marketing federal business opportunities:

Multiple Front Marketing

What Small Business Should Know About FEDBIZOPPS

Small Business Teaming

Assuming you have located an industry partner or perhaps a mix of subcontractors and/or independent individuals you wish to engage, make sure they have the capabilities to perform the parts of the statement of work on the program you are targeting. Remember that the quality of your proposal, your probability of a win, and ultimately your past performance rating on the contract, will reflect your supplier management. The government will hold you accountable for their performance. In some cases agencies will reserve the right to approve your key personnel and subcontractors before issuing your prime contract.

Two general guidelines should be observed:

1. Do not subcontract in excess of 40% of the program to another company in terms of hours, dollars and % of total work scope. The FAR regulations specify 49% as a ceiling but it is best to reserve 60% of the effort for your company employees and independent contractors under your control to avoid appearances of a front.

2. Do not exceed 50% of the internal labor hours for your company share of the program with contractors as individuals. Government source selection boards need some assurance that the capability to lead and perform major parts of the program resides in the permanent party of the small business prime contractor.

If you exceed the 50% rule for independents, include contingent hire agreements demonstrating the point in time where they will become full time employees or will be replaced by full time employees. A contingent hire agreement may be downloaded from the Box Net References Cube in the right margin of this site.

Sign subcontractors and independents to proprietary data agreements. 

Develop thorough teaming agreements with subcontractors, including an explicit statement of work attachment to each agreement quantifying, the work scope guidelines in paragraph 1, above. A teaming agreement is available for download in the Box Net references cube at this site.

The independent should also understand the specific work and hours he or she will be expected to perform on the job and such personnel should be retained on a contractor retention agreement which is also available for download in the Box Net References cube at this site.

 Teaming agreements, contingent hire agreements, contractor retention agreements and subcontractor proposals must be either included in your proposal submission to the government or made available for government fact finding.


During the proposal stage of the business relationship with your industry partners you will be issuing them requests for proposals (RFP’s) for their portion of the effort.

For independent contractors this may be as simple as asking them to sign contingent hire agreements or contractor retention agreements. 

But you must include in the RFP’s to the companies which you propose as subcontractors the terms and conditions of your agency prime contract RFP and other specific guidance to make the proposal and subsequent contracting process work smoothly. This should include administrative guidelines and agreed upon cost targets and technical guidance.

Specify a due date for their proposals in response to your RFP in time to roll their data into your cost volume and provide guidance on the handling of fully loaded rate backup to which you do not have access to forward to the government auditors. This usually includes sealed packages provided by your subcontractors that you will not open, since they contain overhead and G&A rate information which is highly proprietary to the subcontractor.

Keep in mind that you are in a constant negotiation with these partners until you award them subcontracts to replace the teaming agreements when your team wins the program. Please see the following article for detail guidance on that point:

Contract Negotiation

Naturally the technical and management volumes of the proposal will be completed in consonance and in parallel with the subcontractor RFP cost proposal responses.

At contract award, be prepared to negotiate and execute formal subcontracts to the companies with whom you are teamed and to issue purchase orders to your independents to commence work. At that point you have achieved the contract baseline and you will commence work.

 Insure that your subcontracts and purchase orders contain limitation of funds and funding exposure protection for all parties in accordance with the following article:

Limitation of Funds and Funding Exposure


Please read the following article carefully on baseline management and bear in mind that work scope change sensitivity must be managed carefully and formally documented between you and your industry partners by change orders to formal subcontracts and purchase orders:

Contract Baseline Management


This article has provided an overview of subcontractor and independent contractor management from the early marketing stages of a contract pursuit through proposal preparation and submission then contract award and baseline management.

Please read the reference links in the text above carefully and check the table of contents at the below site for other information relevant to this topic.”



How To Stand Out In The Government IT Contracting Crowd


The Great Waldo Search


“If you are a small IT services firm in the government market, you have the same problem: Standing out from the crowd.

If you don’t stand out in that first face-to-face meeting, you are doomed to become just another face in the crowd, only no one will be looking for you.”

“Anybody know Martin Handford? Probably doesn’t ring a bell, right?

How about Where’s Waldo? Does that ring your doorbell? Handford produced/drew the popular book series starting in 1987. I have a few in my library. My daughter could always find Waldo before me. So could my wife and son… hell, probably the cat, too.

Great, Mark. What’s the point?

Even though Waldo dresses differently, when he is in a crowd he does not really stand out.

Why? Because he’s in a crowd.

Over the years I’ve had numerous discussions with Offices of Small, Disadvantaged Business Utilization, Small Business Liaison Offices, program managers and senior business development personnel in large contractors about the best ways for small companies to approach agencies and primes in that first face-to-face meeting.

There are several themes that come up in virtually every conversation. Here they are in no particular order. For our purposes our small contractor is TSSIE (pronounced tiz-zee: The Smallest Systems Integrator Ever).

They (TSSIE) don’t know us: TSSIE comes in having done little or no research on the agency or prime. They either don’t know what the agency or contractor needs, they are unfamiliar with the scope of the contracts involved. They are, however, prepared to talk about themselves.

They lead with a non-starter: TSSIE leads with a set-aside status. OSDBUs, SBLOs and program managers don’t care about your status. They care about your skills. What are you really good at- and do I need it for my agency or my team.

They are an IT generalist: TSSIE claims expertise in 10 or more IT specialties, yet only has 5 employees. TSSIE’s response to each question is “Yeah, we can do that.”

They tout a non-strength: TSSIE brags to primes that 60 percent of its employees have security clearances (3 of the 5 employees). Prime responds by saying that only 4 percent of its workforce (4,700 out of 117,500) are cleared.

So how should TSSIE present itself as a differentiated contractor in a face-to-face meeting?

TSSIE should:

  • Present itself as a knowledgeable contractor. Always do research before a meeting;
  • Small companies cannot be expert in many things, so pick a niche you are good at and work hard at becoming better;
  • Small companies need to focus on just one or two agencies and get to know them well. Develop relationships inside the client agency;
  • Whether it’s an agency or prime, look them up on LinkedIn before the meeting to learn more about the people you’ll meet with;
  • When getting ready for an OSDBU/SBLO visit, read the OMB 53 submission, scour the agency web site, search the trade media for any agency information especially about contract preferences;
  • If asked about a peripheral area, indicate whether or not you have done it before, but be honest and say it is not a strength;
  • If you have good CPARS and good client relationships, say so. Both past performance and actually knowing the players are key to moving forward;
  • Develop a list of questions pertinent to the meeting, things that came up during your research. You can use rhetorical questions to ascertain some of your assumptions;
  • Take detailed notes, or if possible, bring someone just to take notes;
  • Have a one-pager (not a dossier) on your capabilities and current contracts. Include both NAICS and PSCs. Include SINs if they are specific, like CDM. If you have a set-aside status, list it.

One of the services I offer my clients is strategic introductions, but I don’t make the intro if the client is not prepared. You may only get one chance for a face-to-face meeting, so you need to make the most of it.”



Should You Consider Small Business Federal Government Contracting?



“SMALLTOFEDS” By Ken Larson 

“Small business federal government contracting is different from the commercial marketplace in terms of business system requirements, marketing, teaming relationships, pricing and the duration of associated contracts.

The topics in this discussion plus free articles and books with further reading at this site may assist you in your decision whether or not to include the federal market in your business plan.”

“There has been a dramatic increase recently in counseling requests from small businesses inquiring about entering federal government contracting. This article will address some basic things for you to consider in testing that prospect.


If you don’t have a business plan in these changing economic times you need one and you should keep it a living document. It is the key vehicle to determine your path forward and convince people that can help you of your firm’spotential. Loan officers and investors are interested in your business plan as a function of evaluating the thoroughness of your future vision and validating your funding forecast needs.

Please go to the SBA web site that guides you through the business planning process. I suggest you follow the site presentation and note the factors to consider. The link to the SCORE site business planning presentation is:

Business Planning Guide

The following site contains samples of business plans:

Sample Business Plans

Ask yourself some strategic questions, such as what competition you envision, what your marketing plan will be, etc. Addressing some of these questions may take some research and that is all part of the process of putting in place your plan. It is your road map for the future.


Your business plan should be a repository for research on the federal government marketplace and how you fit into it. There are many agencies and government prime contractors to whom you may be able to sell your products or services.

Like any other customer, the government expects you to finance your business, meet your payroll, pay your expenses and submit a bill for products and services delivered or rendered. The federal payment cycle is often 60 to 90 days, depending on whether or not you are a subcontractor to a prime corporation.

In federal government contracting you must also comply with the Federal Acquisition Regulation (FAR) and associated Cost Accounting Standards (CAS). Although these requirements are not “Rocket Science”, they are different from commercial rules and generally accepted accounting practices (GAP). They have evolved over the years as the federal government has grown in the volume of goods and services it buys. Very few universities make FAR and CAS part of their curriculum and CPA’s do not encounter them on a certification exam. Several articles at this site address the practical implications of FAR and CAS requirements for a small business.

The prudent, small businessperson reviews the potential impact of FAR and CAS on his or her business systems and processes before undertaking a government contract, particularly a cost plus or a time and materials contract. In many cases job cost accounting and long range budget planning are required to support pricing, overhead and general and administrative rates. Government contracts can run several months or even years.

Federal agencies form large-scale projects and use companies to service their needs by contracting specialized skills, sometimes bringing the contractors on site by labor category under time and material, cost plus or fixed rate contracts or by purchasing services or products at company facilities and remote sites.

In other cases, pre-established pricing and terms and conditions are negotiated with several suppliers in advance under omnibus contracts and separate delivery orders are issued competitively based on changing requirements. The General Services Administration (GSA) negotiates pricing and terms on multi-year schedules from which both federal and state agencies are permitted to buy.


One of the first steps that must be completed is registering your company to bid and become eligible for award of government contracts. Please visit the link below for the Central Contractor Registration (CCR) and notice the tips to make sure your file is as complete as possible.

Government Contracting Registration

Also note the North American Industrial Classification System (NAICS) Codes. Please make sure your CCR has the maximum number of codes for which you qualify, since the whole federal procurement system rides on those codes.

Self-Certification as a Small Business, a Small/Disadvantaged Business, a HUB Zone-located enterprise, Woman-owned or Veteran-Owned Business is also part of the registration process. Also insure the narrative description of your services is complete.


You should develop a capability statement (CAPE) for government contracts that is short and hard-hitting. It should be 1 page and should highlight the salient points of your products and offerings, your personnel and your qualifications. It should also include the specific information a contracting officer needs to place an order, such as your D&B Number, your government registration numbers, your North American Industrial Classification System (NAICS) codes and the like. These items are selected or provided by you or determined by the system when you register your company for government contracting.

The purpose of the capability statement is to respond to government postings requesting industry interest in forthcoming procurements. They are normally posted at the state and local sites referenced above and at FEDBIZOPPS, the federal government gateway to contracting:

What Small Business Should Know About FEDBIZOPPS

A CAPE is useful in acquainting teaming partners with your expertise and government buyers with your small business designations and qualifications. It should be developed in PDFJPG or similar formats that that can be emailed easily and readily opened.

The following link shows a typical capability statement by a small business government contractor: He may not be in exactly the same business as you are but you can get the idea of what a CAPE should look like and perhaps frame your own document by examining his:

Your CapabilityStatement


To propose and win federal government contracts you must become familiar with federal contract marketing, proposal preparation, negotiations and terms and conditions. It is a huge market, but a competitive one. Part of developing the final version of your CAPE will be to examine the market and pinpoint what is out there in the way of typical government bid solicitations that fit your line of work and then frame your document presentation.

The following additional reading at this site will provide background for your research:

Government Contracting Customer Relations

Marketing A Small Business in the Government Environment

Government Contract Negotiation

Establishing Federal Government Compliant Small Business Systems

The Government Contracting Past Performance Challenge


Regarding larger government contracting corporations to whom you could subcontract – cover the waterfront. Find out what they are bidding and aggressively market a piece of the action as a small business. Determine the locations for the largest government contractors nearest you and register at their supplier business sites. Everything they buy for their facilities, their personnel and their operations counts toward the small business goals required contractually of them by their enormous government contracts.

Research their web sites and locate their small business liaison officers. Make appointments and visit them. While visiting, seek the names and titles of managers internal to their companies who manage prime contracts involving expertise your business can supply. Go after those managers.


Please check the table of contents on the right margin of this site for other topics that may be useful to you and consider downloading the free book from the BOX in the right margin as well.  Small business federal government contracting is different from the commercial marketplace in terms of business system requirements, marketing, teaming relationships, pricing and the duration of associated contracts. The topics in this discussion and further reading at this site may assist you in your decision whether or not to include the federal market in your business plan.”



Small to Feds, Hastings MN

As a Volunteer Counselor, Ken Larson assists many small businesses with their planning and operations processes. Subsequent to his military service Ken spent over 30 years in federal government contract management and 10 years in small business consulting. He gets many inquiries from small companies wishing to enter or enhance their position in federal government contracting or grow their commercial enterprise. 
Those wishing a free counseling session may search on “Kenneth Larson” at: http://www.micromentor.org/ or use the key words, “Federal Government Contracting”


Beltway Bandits, Cronyism And Department of Defense Exclusive Contracts


Pentagon No Bid Contracts


“The Pentagon’s crony capitalism, aka military procurement, never sleeps.  According to recent reporting from the Project on Government Oversight (POGO), Amazon spent $37 million on lobbying last year and gave $1 million to candidates of both parties.

According to reports, Amazon Web Services (AWS) is the clear frontrunner to win a sole source, 10-year, $10 billion contract from the Department of Defense (DoD) to handle all of its cloud computing.”


“The case for a sole provider, however, is underwhelming, with critics saying the idea of putting all of the DoD’s computing on “one cloud” is unheard of. Congress should direct the Pentagon to do the right thing, not collude with a new member of the multi-trillion-dollar military-industrial-counterterrorism complex.

Amazon’s current market capitalization exceeds $750 billion, making it the second most valuable publicly listed company in the world after Apple. Post-retirement employment or consulting opportunities for DoD personnel involved in procurement concentrate the mind wonderfully.

The lamp of experience teaches that military procurement is to procurement as military music is to music. The Pentagon would be bankrupt if it held no government monopoly on the armed forces. The day before 9/11, Secretary of Defense Donald Rumsfeld reported that $2.3 trillion in spending by the DoD could not be documented. Although required by law, the DoD has never been audited (though it’s supposedly in the midst of its first one now). In the meantime, a recent internal audit of the Defense Logistics Agency found that the agency could not provide proper documentation for more than $800 million worth of construction projects, among other abnormalities. No private investor would invest a penny in such a financially feckless enterprise. Even Saudi Arabia’s fabulously wealthy ARAMCO underwent an outside audit in contemplation of stock sales.

The DoD’s byzantine but also lackadaisical procurement standards give birth to chronic financial disasters. These include Lockheed Martin’s huge Air Force C5-A transport plane’s cost overruns and performance deficiencies; General Dynamics’ Electric Boat Division’s production of the Navy’s SSN-68 Attack Submarine at a hugely inflated sum despite major construction flaws, and, more recently, Lockheed’s F-35 Joint Strike Fighter, the most expensive weapon system in the nation’s history (and still in testing stages after nearly 20 years).

Lax procurement safeguards also invite corruption. Thus, Darleen Druyun,principal deputy assistant secretary of the Air Force, was convicted of bribery in 2004 for awarding a $23 billion sole source leasing arrangement with Boeing for 100 KC-767 mid-air refueling tankers in exchange for a lucrative post-retirement position with the mainstay of the military-industrial complex.

More recently, two U.S. Navy captains and a commander faced court martial in the so-called “Fat Leonard” scandal in which a charismatic Malaysian businessman was able to bilk the Navy for $35 billion in fuel charges, mostly by bribing officers with lavish gifts and prostitutes. Some 200 people have been connected to the scandal with at least 18 Navy personnel pleading guilty to federal crimes or charges under the Uniformed Code of Military Justice. Leonard Glenn Francis, also known as “Fat Leonard,” continued to get lucrative DoD contracts for years despite repeated calls for investigation.

The DoD’s contemplated 10-year exclusive cloud computing contract with AWS predictably carries earmarks of procurement amateurism, bias, and even influence peddling. Other suppliers are no slouches, including Microsoft, IBM Corp., and industry groups representing rivals such as Oracle Corp. They know that, according to this Bloomberg report, that Amazon has increased its lobbying presence in Washington by 400 percent over five years and has lobbied Congress on no fewer than 24 issues (each would include dozens of laws and regulations, including relaxing rules for flying commercial drones, for their deliveries, specifically).

According to recent reporting from the Project on Government Oversight (POGO), Amazon spent $37 million on lobbying last year and gave $1 million to candidates of both parties.

Those efforts appear to have paid off last year with the passage of the so-called “Amazon amendment,” a provision tucked into the defense authorization bill that will establish a program facilitating government purchasing through e-commerce portals like Amazon.com.

A full-court press on specific agencies is no different. According to Bloomberg, Amazon’s lobbying netted the cloud contract for the CIA, and an earlier contract with Pentagon for $950 million.  In 2016, Bezos was appointed to the Defense Innovation Advisory Board, to ostensibly help the Pentagon with new technologies. He also hosted Defense Secretary James Mattis at Amazon’s Seattle headquarters in August 2017.

It doesn’t hurt that the revolving door of top Pentagon officials who retire and then work for industry players, or serve on their boards, only to push and lobby for contracts and weapon systems the military doesn’t even necessarily want, is notorious. In 2010, then-Boston Globe correspondent Bryan Bender analyzed the career paths of 750 “of the highest ranking generals and admirals who retired during the last two decades.” He found that, “for most, moving into what many in Washington call the ‘rent-a-general’’ business is all but irresistible.”

From 2004 through 2008, 80 percent of retiring three- and four-star officers went to work as consultants or defense executives, according to the Globe analysis. That compares with less than 50 percent who followed that path a decade earlier, from 1994 to 1998.

According to POGO, citing statistics from the watchdog group Center for Responsive Politics, 59 of Amazon’s 90 lobbyists are “revolvers” who had previously worked somewhere in the federal government.

But why can’t the Pentagon see its way clear past all of the heavy sell for these sole-source contracts? Diversity of risk is business gospel, i.e., don’t put all your eggs in one basket, and the DoD’s nuclear triad is anchored in that truth. Multiple suppliers diminish the risk of non-performance. They also diminish the risk of technological obsolescence, which is exceptionally high in our digital age of warp-speed advances. They lessen the risk of hacking from Russia, China, Iran, North Korea, and other enemies of the United States. Indeed, AWS has sold computing equipment used in its cloud services in China to its local partner there, Sinnet Technology Co. That collaboration heightens the risk of China hacking into AWS’s cloud services to DoD.

Multiple suppliers lessen the risk of procurement corruption like the Darleen Druyun-Boeing scandal by making concealment problematic. Druyun’s email correspondence revealed a consistent pattern of favoring Boeing in price negotiations; she had previously tilted two other contracts towards Boeing worth $500 million while arranging Boeing jobs for her daughter and her daughter’s fiancé. The more players involved in a procurement award, the less likely it is that corruption will escape detection and exposure by a whistleblower or otherwise.

Multiple suppliers would also slash the $10 billion figure for cloud computing services if provided exclusively by AWS. When AT&T lost its phone monopoly, the cost of long-distance calling dropped to a fraction of its prior rate. There is no reason to believe the market for cloud computing services to the Pentagon would operate any differently.

The Pentagon has refused to explain its winner-take-all approach to its $10 billion cloud services contract. Taking umbrage at an inquiry, the agency snapped: “This rationale is not going to be published at this time.”

Cloud computing services and cybersecurity are too important to be left to the generals. Congress should brandish its legislative prerogatives to force DoD to use multiple cloud computing service providers. Otherwise crony capitalism will continue to be at its worst in the Pentagon.”



FDA Reverses Course On A $4.2 Million No-Bid Grant To A Former Commissioner


FDA Sole Source Grant MuddassarAwan

Image:  Muddassar Awan


“The Food and Drug Administration is reversing a decision to award a no-bid $4.2 million grant to a policy center at Duke University headed by former FDA commissioner and current paid board member for Johnson & Johnson Mark McClellan.

McClellan served as FDA commissioner under President George W. Bush. The current commissioner, Scott Gottlieb, served as his senior adviser.”


“The funding opportunity was posted in late April as a five-year grant for which only a single institution, the Duke-Robert J. Margolis Center for Health Policy, was eligible to apply. The grant’s purpose was to “to help advance regulatory science to promote the increased availability of safe and effective drugs to the public,” according to the request for application. FDA said in a statement that it is in the process of opening the grant application to other institutions.

Several health policy experts had expressed favoritism concerns about the initial no-bid proposal, raising questions about what made the Duke center uniquely qualified to do the work, which involves convening discussions with drug companies, health-care providers and patient groups to discuss key issues in the drug approval process.

They also raised concerns about McClellan’s role as a paid board member for Johnson & Johnson, one of the largest drugmakers in the world, given the pharmaceutical industry’s deep interest in drug approvals.

“It is not like there’s one laboratory on the planet that knows how to clone these particular genes — there’s a substantial number of groups out there that work on these issues. It frankly makes no sense that the only place you could go for this is the Duke center run by a drug company advocate,” said Jerry Avorn, a professor of medicine at Harvard Medical School, which has a center that conducts similar work. “The very fact that they could have thought this was a good idea, even to the point of publishing the request for proposals, is important because of what it reflects about the decision-making process within FDA and the administration.”

Ellen de Graffenreid, a spokeswoman for the Duke-Margolis Center, directed inquiries about the grant to the FDA and stressed that Gregory Daniel, the deputy director of the center, is the principal investigator on its current agreements with the agency — not McClellan.

The FDA, after initially defending the no-bid proposal, said in a statement that the agency had “become aware of other organizations who believe that they can submit a competitive proposal to conduct the needed research and related activities. As a result, FDA has decided to change the announcement from a sole source award to an open competitive grant.”

In a statement, McClellan said, “My work and the work of the faculty and staff affiliated with the Duke-Margolis Center speaks for itself, and complies with Duke’s well-established policies intended to address any issues related to conflict of interest.”

FDA has awarded sole-source grants in the past — though these are rare. In 2017, there were 548 funding awards by FDA, of which six were sole-source awards, according to an FDA spokeswoman.

Until this week, the FDA had defended this sole-source grant, saying in an email that “agency policy allows for exceptions to competitive bidding under certain circumstances, such as when the agency finds a particular institution is uniquely qualified to carry out a cooperative agreement.”

FDA made a sole-source award of a similar grant in 2013 to the Brookings Institution’s Engelberg Center for Health Care Reform, which  McClellan led from 2007 to 2013.

McClellan identified himself as director of the Center in June of 2013 in testimony before Congress. McClellan took a paid position on the Johnson & Johnson board in fall of 2013. He received $285,000 last year for his work, according to company filings.

De Graffenreid said Wednesday that McClellan was no longer affiliated with the Engelberg Center when he joined the corporate board, saying in an email he had stepped down in 2012 to spearhead a major initiative. Documents posted by Brookings Institution described the initiative as “within the Engelberg Center.” De Graffenreid later said that he continued to be affiliated with the Center through 2015.

FDA justified the 2013 grant at the time on the center’s “status as a neutral, nonprofit, research-focused institution” and reputation as “an ‘honest broker’ with the ability to identify practical solutions that reflect the best available science and input from all stakeholders,” according to a notice in the Federal Register in March of 2013.

The principal investigator of that grant was also Daniel, McClellan’s current deputy at the Duke-Margolis Center.

Alfred Engelberg, a patent lawyer who was a major funder of the Brookings Engelberg Center, said in an interview that he objected to McClellan’s role on a corporate board and cited that as a reason when he ended his financial support in March of 2015. He said the bulk of his $10 million contribution occurred before the conflict arose.

“I personally believe Mark McClellan could not serve as a director of the Engelberg Center and Johnson & Johnson, and because I believe that I withdrew. He has a fiduciary obligation to a drug company,” Engelberg said.

In 2015, McClellan left Brookings for Duke University. A. Eugene Washington, Duke University’s chancellor for health affairs, is also on Johnson & Johnson’s board.

Gerard Anderson, a professor at Johns Hopkins Bloomberg School of Public Health who has worked with McClellan, said he values his insights on topics like drug pricing and policy, but doesn’t consider him neutral.

“He is smart and an excellent researcher, so I want his perspective, but you need someone who does not take a perspective in this role at the FDA. In many instances Mark is an advocate, somebody with a position and not as somebody who is neutral,” Anderson said.

“Sole-source contracts are very challenging to award in the government,” Anderson added. “You really have to have a unique skill or unique data set or a unique something that allows you to grant somebody a sole-source contract — and to give conferences and to give meetings isn’t one of them.”

McClellan did not disclose his relationship with Johnson & Johnson in his biography or in the white paper published from FDA-supported meetings in 2016 and 2017, which discussed the use of new kinds of evidence in the regulatory process.

“The fact that the center is headed by someone who also serves in a paid position on the board of pharmaceutical company is a clear potential conflict of interest,” Sean Moulton, open government program manager at the Project on Government Oversight, wrote in an email. “There are several safeguards that could be instituted. First and foremost is disclosure of the potential conflict. It should be made clear to all participants that the potential conflict exists. At any meetings that occur it should be disclosed at the beginning, especially if the head of the center is participating in the meeting.”

On several medical publications about health topics, McClellan does not disclose his board membership. Duke said he was following the university’s policies.

“Dr. McClellan follows Duke policies with regard to the time, place, and nature of appropriate disclosure,” de Graffenreid wrote in an email. She added that the kind of work Duke does for FDA “does not include providing advice or policy proposals to the agency.”


US Remains Top Military Spender



Military_Spending_Indy_0 Portside dot org


“Worldwide military spending is estimated to have reached $  1.7 trillion in 2017, according to a new report from the Stockholm International Peace Research Institute. This is the highest level of military expenditure since the end of the Cold War.

Although U.S. spending has decreased from 2008 levels by 14 percent, it still spends 2.7 times more than the next highest spender, China.”


“The top five biggest spenders were the United States, China, Saudi Arabia, Russia and India, which accounted for 60 percent of global military spending.

China, Russia and India saw dramatic increases in spending since 2008. According to the report Chinese military spending in 2017, approximately $228 billion, has increased 110 percent since 2008, with Russian and Indian spending growing by 36 and 45 percent to $69.4 billion and $66.3 billion, respectively.

Between 2016 and 2017, China increased military spending by 5.6 percent, Saudi Arabia by 9.2 percent and India by 5.5 percent. Despite announcing a new host of nuclear weapons and completing the country’s largest military exercises in history, Russia’s spending fell by 20 percent in the same time frame.

“The increases in world military expenditure in recent years have been largely due to the substantial growth in spending by countries in Asia and Oceania and the Middle East, such as China, India and Saudi Arabia,” said Dr Nan Tian, researcher with the SIPRI Arms and Military Expenditure program. “At the global level, the weight of military spending is clearly shifting away from the Euro–Atlantic region.”

Out of the top 15 military spenders, only the U.S., United Kingdom and Italy had a decrease in spending over the last decade.”