Tag: federal contracting

President’s Draft Order Politicizes, Damages Federal Contracting

The National Association of Manufacturers joined 87 other business groups and trade associations in a letter to President Obama on Monday night, raises numerous objections to a draft executive order that would require disclosures of campaign contributions by select parties involved in federal contracting.

The draft order is an attack on the First Amendment, as the letter states, suffers from severe legal and policy defects that would, if signed, immediately damage the federal contracting process.

From the letter:

The executive order would make every company that tries to contract with the federal government disclose spending that is confidential and used to fund core, First Amendment-protected political speech. Also troubling is the executive order’s reach beyond companies to their individual officers and directors, who would be forced by the executive order to disclose personal political spending undertaken with their own assets. This aspect of the order will both impair individuals’ First Amendment freedoms and interfere with the relationships between companies and their employees.

The political spending covered by the draft executive order is protected by the First Amendment and may not be interfered with absent an important governmental interest. It is quite clear, however, that despite perfunctory language to the contrary, the draft executive order is not motivated by a desire to improve the federal procurement system or any other potentially legitimate governmental interest. Indeed, the federal procurement system already has several built-in safeguards that work quite well to ensure that contract awards are based on the merits of the bid proposal.

Rather than strengthening these existing safeguards, the draft executive order would politicize the procurement process. The proposed order will either encourage covered speakers to refrain from exercising their constitutional speech rights so as to avoid jeopardizing their competitiveness for federal contracts, or it will encourage speakers to alter their political messages in ways perceived to increase their chances of being awarded federal contracts. Either effect is a problem under the First Amendment.

Thanks to the U.S. Chamber’s blog, the Chamber Post, for highlighting the letter.

And here’s a good summary of the issues from Heritage’s Hans von Spakosvky in The Examiner, “DISCLOSE executive order would politicize federal contracting.” Hans is a former member of the Federal Election Commission.

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Attacking Speech, an Executive Order on Government Contracting

President Obama could this week issue an executive order to force business  to disclose campaign contributions to qualify for government contractors, an attack on the First Amendment that would politicize federal contracting and inevitably lead to corrupting “pay for play” arrangements. This isn’t transparency, it’s brute politics.

The National Association of Manufacturers last week released a statement from NAM President Jay Timmons on the proposal, “Manufacturers: Presidential Executive Order Will Strip First Amendment Rights.” Timmons said:

President Obama’s plan to inject politics into the federal contracting process through an executive order is bad policy. Further, the matter already has been rejected by Congress.

While the NAM does not engage in political activity or have a political action committee, we are committed to protecting the First Amendment rights of manufacturing companies who participate in the government contracting process. The draft order would give this or any future Administration unchecked authority to discriminate against certain companies based on their past donations or engagement. This move is a sweeping effort to control personal political involvement through coercion.

Congress already rejected the DISCLOSE Act last year, legislation meant to squelch speech by groups disfavored by the Administration. That the President has plans to circumvent the legislative branch of government — circumvent the First Amendment — to restrict speech by a select, disfavored group of Americans is offensive.

Coverage, commentary ….

Kim Strassel, Wall Street Journal, “Obama’s ‘Gangster’ Politics“: (continue reading…)

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High Road? Except for the Tolls, Check Points and Costly Detours

The Center for American Progress, some labor leaders and their allies on the Hill have been placing pressure on the Administration to implement significant changes on how the federal government does business with the private sector. These groups want a government-wide “High Road Contracting Policy” to be put into effect by an executive order. Such a Presidential edict would dictate specific terms of employment that contractors must have in place in order to receive preferential treatment for federal contracts.

This proposal would add further burdens onto an already complex federal contracting system that would discourage competition in federal contracts and place smaller-sized manufacturers and non-unionized workplaces at a disadvantage for federal contracts. Led by Sen. Susan Collins, ranking member of the Senate’s committee with oversight over federal contracting policy, several Senators recognized the dangers of this proposal and have urged the Office of Management and Budget to reject any “high road” changes.

The administration claims its goal is to maximize efficiency in federal contracting. However, previous executive orders enacted supposedly to achieve the same goal have actually done the opposite. Bidders who wish to provide goods or services to the federal government should be evaluated on their ability to provide and deliver on the terms of the contracts. This process fosters competition and allows the bidder that demonstrates the best value to be recognized when bids are accepted and awarded.

The proposed “high road contracting policy” is a further attempt to achieve goals of the jobs-killing Employee Free Choice Act by executive fiat. As Roll Call notes, a group of Members of Congress recently urged the President to issue such an executive order. But as fundamental matter of labor-management relations, this is a policy matter that should be considered by the policy-making branch of the federal government – the Congress. If the Administration seeks to raise the costs of federal contracting – costs ultimately borne by the taxpayer – it should make its arguments in Congress.

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Davis-Bacon on Steroids

From The Wall Street Journal, an editorial, “Procuring the Union Agenda“:

In a novel variation on pay to play, the Obama Administration is planning to force companies to raise pay and benefits for workers if they want continued access to federal contracts. Waiting to cash in on the impending Executive Order are unions that would end up with a piece of the government’s $500 billion in annual contracts.

The government can’t steer contracts directly to the unions. But it can use its authority over how taxpayer money is spent to favor unions and their agenda. This is good news for Andy Stern and his Service Employees International Union. But not so good for job creation.

The proposed Executive Order is being drawn up by Joe Biden’s Middle Class Task Force. It would oblige government procurement agencies to give contracts to “responsible contractors” who pay workers well and offer higher health, pension, sick leave and other benefits.

The Journal argues that this scheme, enforced by “labor commissars” at each federal agency, would especially disadvantage small businesses unable to offer the full range of benefits larger companies can achieve.

Associated Builders and Contractors, representing companies painfully familiar with Davis-Bacon and project labor agreements, issued a news release last week in response to reports about the “high road contracting policy.” In it, ABC’s Geoff Burr, vice president of federal affairs, said:

The provisions outlined in media reports – as well as in documents from the Center for American Progress, big labor and other special interest groups promoting this policy – fly in the face of free and open competition.

Large and small nonunion construction contractors and their skilled employees – which make up more than 85 percent of the U.S. construction workforce – are the backbone of America’s construction industry. These hardworking men and women have a decades-long track record of meeting and exceeding existing government-determined wage and benefit laws, such as the Davis-Bacon Act, and contracting standards in the best-value evaluation process unique to the federal government’s procurement of construction services.

The proposal is baffling given the Administration’s stated emphasis on jobs creation. As Burr notes, the U.S. construction industry already suffers from an unemployment rate of 24.7 percent. Why would you increase costs on this important sector of the economy?

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If Not Card Check, Then More Costly Federal Contracts

Bret Jacobsen in Forbes.com, “Everyday Higher Prices,” a commentary on the “high road” federal contracting standards:

It’s just the latest effort to increase costs on taxpayer projects in the name of pushing more money to labor unions.

Reports this week of the new proposal are raising eyebrows. Though details are sketchy, here’s the general idea: The Obama administration is attempting to alter the scoring system currently used to evaluate government contractors and suppliers.

The new system would provide additional points for so-called “high road” employers who pay wages and benefits above minimum standards. (Note that the new requirement is not about providing quality above minimal standards; employers simply have to pay more.) Thus, competition in bidding becomes a tangled race to see who can charge the most to cover higher labor costs.

The costs of this favor to Big Labor would be borne by the taxpayers, paying the direct costs of more expensive contracts and indirect costs from inefficiency.

The recent report from the White House Task Force on the Middle Class foreshadowed this major change in federal contracting. From page 23, the section entitled “Responsible Federal Contracting.”

The Federal Government spends over half a trillion dollars a year on contracts for goods and services, generating employment for tens of millions of workers. However, there are inadequate controls on the records of firms who get these contracts and on the quality of the jobs these contracts create.Ignoring these factors has negative implications, not only for the workers on these contracts, but for the quality and efficiency of services rendered. For these reasons, the Task Force has participated in a review process to identify ways to reform the procurement process to increase the quality of both the services procured and the jobs created under Federal contracts.

The Task Force recognizes that contracts should not be awarded to irresponsible sources with unsatisfactory records of business ethics, including noncompliance with labor and employment, tax, fraud, and consumer protection laws. We also recognize that substandard wages and benefits can have negative impacts on employees’ productivity and stability, which in turn can reduce the quality of performance on Federal contracts.

We expect to produce shortly some new recommendations to bring these ideas into practice.

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President Obama and Organized Labor IV — Executive Orders

Here are the executive orders that President Obama signed today.

NOTIFICATION OF EMPLOYEE RIGHTS UNDER FEDERAL LABOR LAWS

NONDISPLACEMENT OF QUALIFIED WORKERS UNDER SERVICE CONTRACTS

ECONOMY IN GOVERNMENT CONTRACTING

None is yet posted at WhiteHouse.gov, Briefing Room. A late Friday release usually means what again?

(UPDATE) (6 p.m.): Or rather, downdates, i.e., earlier posts.

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