The Great Debate

Don’t go overboard banning military contractors

During the 15 years that I led the Air Force’s contractor responsibility and fraud missions, we debarred and suspended nearly 5,000 contractors – more than any other government agency. But what is far more important than the statistics is the greater protection we were able to provide the government by exercising these powers fairly and with balance, through the careful exercise of discretion. But that is coming to an end. We are now seeing a disturbing trend: new rules and outside pressures that would limit, and even eliminate, the ability of officials like me to exercise that discretion. Companies are being “blacklisted” – often for lengthy periods, sometimes automatically without due process, and often based solely upon the actions of a few rogue employees, with little consideration of whether such action is needed or fair.

The debarment regime is important for the government, and frankly makes sense. Most of us would not hire a plumber whom we knew did faulty work on a neighbor’s pipes. Given that, why would we put up with the serious fraud being committed today, particularly where it may affect our troops in multiple war zones? We can and should work only with responsible contractors. To do that, the government sets standards for contractor eligibility, and each agency has a suspension and debarment (S&D) official empowered to administer those standards. But in administering those standards those officials must always be mindful that the S&D system is not intended as a tool for punishment. While punishing fraud is important, it properly belongs in the criminal justice system, not with procuring agencies.

Not every act of misconduct should result in a company being blacklisted. Even the best companies have employees who cross legal and ethical lines. The important point is how a company’s leaders encourage proper conduct, identify and mitigate compliance risk, respond to the misconduct of their employees, and accept responsibility for good corporate governance. In most cases the government is not threatened by continuing to deal with a contractor whose employees engaged in isolated misconduct but whose management corrected the problem and is now acting responsibly. Regrettably, the current political atmosphere is straining this delicate balance in three notable respects. And there is a lot at stake: The U.S. Government is the world’s largest purchaser of goods and services, with approximately one out of every six dollars of federal government spending awarded to contractors.

First, some public officials are seeking to score political sound bites by making S&D mandatory – that is, imposing it automatically following a triggering event such as an allegation of wrongdoing, an indictment or a conviction.  The Consolidated Appropriations Act of 2012, for example, prohibits certain agencies, including the Department of Defense, from funding contracts for corporations convicted of any federal felony within the preceding 24 months, unless each agency that deals with that contractor makes a separate affirmative determination that such action is not necessary to protect that agency’s interests. Other proposed legislation would go even further to provide for the automatic suspension of a contractor when the government merely alleges fraud against a contractor in any civil or criminal proceeding related to a federal contract.

Such approaches are ill-advised. Automatic debarment prevents agency officials from proactively encouraging contractors to mitigate fraud risk prior to any misconduct occurring. And it also limits the government’s ability, after misconduct is discovered, to structure resolutions that influence and motivate positive corporate behavior – or to take no action at all.

Obama’s first foreign policy blunder

This is an excerpt from The Emergency State: America’s Pursuit of Absolute Security at All Costs, published recently by Penguin Press.

The defining mistake of Obama’s first-term foreign policy was his decision to escalate American military operations in Afghanistan. There were 35,000 American troops in Afghanistan when Obama was inaugurated. By the summer of 2011 there were roughly 100,000. The main national security rationale for their presence was to prevent the Taliban from regaining sufficient strength to invite Al Qaeda back to the Afghan training camps and sanctuaries they had operated from before 9/11. But since early 2002, seven years before Obama became president, Al Qaeda and Osama bin Laden himself — until he was tracked down and killed by U.S. commandos in May 2011 — had been based in Pakistan, under the protection of a Pakistani army that continues to receive billions of dollars in American military aid.

Long before his presidential bid, Obama had called for an increased American military effort in Afghanistan. He repeated that position frequently during the 2008 campaign. Obama’s strong opposition to the Iraq War led many supporters to imagine that he rejected the idea of defending America against terrorism by waging conventional military conflicts in distant Islamic lands. Some of the more philosophical passages in Obama’s autobiographical books, writings, and speeches elaborating on his opposition to the Iraq War fed that misimpression.