Government Pays More in Contracts

[hcap]

http://www.nytimes.com/2011/09/13/us/13contractor.html?_r=2&ref=us

Government Pays More in Contracts, Study Finds


WASHINGTON — Despite a widespread belief that contracting out services to the private sector saves the federal government money, a new study suggests just the opposite — that the government actually pays more when it farms out work.

The study found that in 33 of 35 occupations, the government actually paid billions of dollars more to hire contractors than it would have cost government employees to perform comparable services. On average, the study found that contractors charged the federal government more than twice the amount it pays federal workers.

[Tom]

That means they are wasting our tax dollars.

BTW, the plant Obama is visiting today - to hawk his save my job bill, is in the process of sending jobs overseas! :bang:

[ArlJim78]

haha, and does this surprise you?
It says nothing about the private sector and everything about how the government lets contracts.

what possible incentive does the government have to contract out for work at a lower cost than if they used government workers?

I can't believe why people don't get it, when you're spending an inexhaustable supply of other peoples money, with no consequences for failing or choosing badly, you will ALWAYS pay more.

this is why why have to use the absolute minimum amount of government.

[Saratoga_Mike]

haha, and does this surprise you?
It says nothing about the private sector and everything about how the government lets contracts.


what possible incentive does the government have to contract out for work at a lower cost than if they used government workers?

I can't believe why people don't get it, when you're spending an inexhaustable supply of other peoples money, with no consequences for failing or choosing badly, you will ALWAYS pay more.

this is why why have to use the absolute minimum amount of government.

Amazing that someone doesn't understand this. Simply amazing.

[cj's dad]

haha, and does this surprise you?
It says nothing about the private sector and everything about how the government lets contracts.

what possible incentive does the government have to contract out for work at a lower cost than if they used government workers?

I can't believe why people don't get it, when you're spending an inexhaustable supply of other peoples money, with no consequences for failing or choosing badly, you will ALWAYS pay more.

this is why why have to use the absolute minimum amount of government.

What 'cap doesn't understand is that most of the work cannot be done "in house". The Feds, State and Munies do not keep qualified craftsmen on their staffs. Most of their jobs are need realted such as garbage men, security, etc..

The gov't CANNOT build or renovate roads, buildings, etc...

[hcap]

Just out of curiosity, it is now been approximately
6 hrs since I posted the article and link. Any one of you free marketeers actually read the article?

"For example, the study found that, on average, the federal government paid contractors $268,653 per year for computer engineering services, while government workers in the same occupation made $136,456."

"For human resources management, the federal government paid contractors an annual rate of $228,488, more than twice the $111,711 to have the same services done in-house."

You would think private contractors could pull off the same task with greater efficiency. So either private companies do not do it more efficiently, private companies cheated like hell, or both.

[lsbets]

I think Jim provided you an answer about 5 minutes after you posted this. I guess since it didn't have pictures you didn't notice it.

[bigmack]

Here's the government worker -

WbUi_3tIsT4

[boxcar]

:lol: :lol: :lol: That was funny, MacK! And just think those pigeons could have pulled double duty. After they finished their typing chores, they could have replaced expensive postal employees and delivered the mail, too. :lol:

Nothing beats the Free Market for innovative ideas.

Boxcar

[skate]

Just out of curiosity, it is now been approximately
6 hrs since I posted the article and link. Any one of you free marketeers actually read the article?

"For example, the study found that, on average, the federal government paid contractors $268,653 per year for computer engineering services, while government workers in the same occupation made $136,456."

"For human resources management, the federal government paid contractors an annual rate of $228,488, more than twice the $111,711 to have the same services done in-house."

You would think private contractors could pull off the same task with greater efficiency. So either private companies do not do it more efficiently, private companies cheated like hell, or both.

You lefties keep trying to pass off something of this sort. What is it that you actually say? Are you saying "gov fault" or "contractors fault".

this is a Mcaskill to Maddow report, am i correct? if so...now we see.;)

Look...the report, from the info you gave, says "Officials were NOT SURE what they we're Buying, nor were they certain about any cost" ect.

typical....we need examples to cover reports...simple enough.

You people receive History in reports and you pass it off, and you pass along Opinions while attempting to say "Facts".

[Saratoga_Mike]

Just out of curiosity, it is now been approximately
6 hrs since I posted the article and link. Any one of you free marketeers actually read the article?

"For example, the study found that, on average, the federal government paid contractors $268,653 per year for computer engineering services, while government workers in the same occupation made $136,456."

"For human resources management, the federal government paid contractors an annual rate of $228,488, more than twice the $111,711 to have the same services done in-house."

You would think private contractors could pull off the same task with greater efficiency. So either private companies do not do it more efficiently, private companies cheated like hell, or both.

No, you'd think the govt wouldn't be stupid enough to pay double to outsource something. You're drawing the incorrect conclusion that the government is more efficient because their internal costs are lower in these cases. No, they just don't have the proper incentives in place to save money when outsourcing work, at least in these cases. Isn't this obvious?

Except for some flex labor, please name a PRIVATE sector company that would outsource work at double the cost of their internal rate. Imagine Microsoft announcing we pay our 17,000 engineers $158,000/yr on avg, but we're going to outsource that work now and pay $350,000/yr. Would you criticize the company accepting the outsourced work OR Microsoft?

[hcap]

I think Jim provided you an answer about 5 minutes after you posted this. I guess since it didn't have pictures you didn't notice it.
what possible incentive does the government have to contract out for work at a lower cost than if they used government workers?

I can't believe why people don't get it, when you're spending an inexhaustable supply of other peoples money, with no consequences for failing or choosing badly, you will ALWAYS pay more.
So you think that in both examples I posted, the government chose poorly? That the problem is always lack of proper oversight, not at all being cheated by paragons of the free market. I get it, the free market will always gouge and cheat, and that is to be desired as a virtue.

Therefore..

1-Nothing should be contracted out
2-Government should increase in size to replace all contractors

OR...a favorite...

3-Oversight should be tighter on the free market, more regulation. Or maybe government should even teach the free market how to be efficient and more importantly moral.

4-Or government is more inefficient than the free market in certain cases.

[skate]

just a nice even report will do fine...thank you, i understand that when they dont give you all the info,,....you're lost.

stick with facts. forget opinion.

[Saratoga_Mike]

So you think that in both examples I posted, the government chose poorly? That the problem is always lack of proper oversight, not at all being cheated by paragons of the free market. I get it, the free market will always gouge and cheat, and that is to be desired as a virtue.

Therefore..

1-Nothing should be contracted out
2-Government should increase in size to replace all contractors

OR...my favorite...

3-Oversight should be tighter on the free market, more regulation. Or maybe government should even teach the free market how to be efficient and more importantly moral.

No, believe it or not, some smart people worked at CMS (oversees Medicare and the federal piece of Medicaid) under GWB. What did they do? They put in place the groundwork for a competitive bidding process for DME (durable medical equip, e.g., a wheelchair) and certain healthcare supplies (e.g., diabetes testing supplies). Traditionally Medicare just put forth a fee schedule and a private vendor would get X dollars for a certain piece of equipment. Under competitive bidding, the vendors all bid on the price they'd offer the supplies at. Guess what happened? Many of the items came in at 30% to 50% below the existing Medicare fee schedule. That's smart govt contracting. Was the private sector cheating before? No, they were accepting the price offered by the govt. Please note this program continues to be rolled out (certain Senators have slowed the process, protecting businesses in their home states). It's this type of innovation we need in the govt contracting process. What's your next question?

[skate]

Was this on your report?


"White House budget officials raised questions about whether they had "sufficient time" to evaluate a 2009 federal loan guarantee to Solyndra Inc., a solar panel maker that recently filed for bankruptcy protection, congressional investigators said Wednesday in a report. "


the above was about a loan made by the feds for over $500 Million back in 2009.

Does it count in your report (from Maddow) that Solyndra Is Going BR.?

Let me explain..."the people stand to lose that $500 Million, since the feds gave them the Money, WHICH makes the cost of Solar Panels very expensive.:cool:

Maybe the feds could make the panels themselves.:p

[Saratoga_Mike]

Was this on your report?


"White House budget officials raised questions about whether they had "sufficient time" to evaluate a 2009 federal loan guarantee to Solyndra Inc., a solar panel maker that recently filed for bankruptcy protection, congressional investigators said Wednesday in a report. "


the above was about a loan made by the feds for over $500 Million back in 2009.

Does it count in your report (from Maddow) that Solyndra Is Going BR.?

Let me explain..."the people stand to lose that $500 Million, since the feds gave them the Money, WHICH makes the cost of Solar Panels very expensive.:cool:

Maybe the feds could make the panels themselves.:p

You'll love this!!!!! Note the date....let's give it another shot...this is different than the last project, I concede, but I love how the money continues to flow...

Energy Department Announces $1.2 Billion Loan Guarantee to Support California Concentrating Solar Power Plant

September 13, 2011 - 2:33pm

Washington D.C. --- U.S. Energy Secretary Steven Chu today announced the Energy Department finalized a $1.2 billion loan guarantee to Mojave Solar LLC for the development of the Mojave Solar Project (MSP). When complete, the 250MW solar generation project located in San Bernardino County, California will increase the nation’s currently installed concentrating solar power (CSP) capacity by approximately 50 percent. Abengoa Solar Inc., the project sponsor, estimates it will fund more than 900 construction and permanent operations jobs.

“Investments in solar generation facilities like the Mojave Solar Project are critical to our effort to create good, clean energy jobs in America and compete with countries like China in the global clean energy race,” said Secretary Chu. “This project will supply local utilities with energy, help drive down the cost of solar power, and fund more than 900 American jobs, all at minimal risk to the taxpayer.”

MSP will be the nation’s first utility-scale deployment of Abengoa’s latest Solar Collector Assembly (SCA), a significant improvement over the prior generation of solar concentrating technology installed in the United States in the 1980s and 90s. The SCA, which was originally developed in connection with an award from the Department’s Office of Energy Efficiency and Renewable Energy, has a number of advanced features, including a lighter, stronger frame designed to hold parabolic mirrors that are easier and less expensive to build and install. The new heat collection element increases thermal efficiency by up to 30 percent over first generation CSP plants.

The Mojave Solar Project will avoid more than 350,000 metric tons of carbon dioxide annually and is anticipated to generate enough electricity to power more than 54,000 homes. An estimated 80 percent of total costs, including both capital equipment and labor, are expected to be sourced in the U.S. MSP will purchase all of the receiver tubes from a facility in New Mexico, the parabolic trough mirrors from a new facility in Arizona and other key equipment from different suppliers in several states across the country. The project is supported by a power purchase agreement with PG&E, one of the country’s largest electric utilities, to sell the energy produced by MSP for a 25-year contract period.

The Department of Energy's Loan Programs Office (LPO) administers three separate programs: the Title XVII Section 1703 and Section 1705 loan guarantee programs, and the Advanced Technology Vehicle Manufacturing (ATVM) loan program. The Title XVII loan guarantee programs support the deployment of commercial technologies along with innovative technologies that avoid, reduce, or sequester greenhouse gas emissions, while the ATVM loan program supports the development of advanced vehicle technologies. To date, the Department has issued loans, loan guarantees or offered conditional commitments for loan guarantees totaling nearly $40 billion to support more than 40 clean energy projects across the United States, including several of the world’s largest solar generation facilities, three geothermal projects, the world’s largest wind farm, and the nation’s first new nuclear power plant in three decades. For more information, please visit http://www.lpo.energy.gov

[Robert Goren]

I work for several companies that managed parking facilities for airports and cities. I have never seen a case where the city could not have done it cheaper, in some cases a lot cheaper. Supposedly the governments were paying expertise. That was bull shit. What they got was scapegoat for when something got screwed up. That what it was really about, not having to take the heat.

[hcap]

No, believe it or not, some smart people worked at CMS under GWB. What did they do? They put in place the groundwork for a competitive bidding process for DME (durable medical equip, e.g., a wheelchair) and certain healthcare supplies (e.g., diabetes testing supplies). Traditionally Medicare just put forth a fee schedule and a private vendor would get X dollars for a certain piece of equipment......

There is good government and bad.
Do you think the GW Bush administration was the first to institute a program that dealt smartly with the bidding process? Why does everyone here assume that the study is not valid because of an abstract notion that there is never proper oversight because of lack of incentive?

The devil is in the details, programs and quality of people, both in government and the private sector. Yes big government gets bloated and clumsy, but to the extent that we need it for important and necessary programs, it can be made workable. This study could indicate that lack of incentive of the overseers, or just as easily point to the gouging and greed of those contracted, simply because they can get away with it.


BTW. what does it mean in terms of the principle of privatization? The republican answer to big government.

[Saratoga_Mike]

I work for several companies that managed parking facilities for airports and cities. I have never seen a case where the city could not have done it cheaper, in some cases a lot cheaper. Supposedly the governments were paying expertise. That was bull shit. What they got was scapegoat for when something got screwed up. That what it was really about, not having to take the heat.

Someone not familiar with the Philadelphia Parking Authority.

[Saratoga_Mike]

There is good government and bad.
Do you think the GW Bush administration was the first to institute a program that dealt smartly with the bidding process? Why does everyone here assume that the study is not valid because of an abstract notion that there is never proper oversight because of lack of incentive?

The devil is in the details, programs and quality of people, both in government and the private sector. Yes big government gets bloated and clumsy, but to the extent that we need it for important and necessary programs, it can be made workable. This study could indicate that lack of incentive of the overseers, or just as easily point to the gouging and greed of those contracted, simply because they can get away with it.


BTW. what does it mean in terms of the principle of privatization? The republican answer to big government.

Who said the study wasn't valid? Who? We're merely saying the govt is not that good at outsourcing.

As for companies that gouge on cost-plus contracts, I believe they should face HUGE civil and criminal penalties. Believe it or not, Republicans oppose fraud.

[hcap]

Who said the study wasn't valid? Who? We're merely saying the govt is not that good at outsourcing.
No merely saying outsourcing is a no no was not the main argument I got. It was blown into Government bad free market good. As usual.

[ArlJim78]

yes the Solar escapades are a great example. The government is paying billions for worthless companies that have no hope of becoming going concern.

we'd get a better payback if instead of giving a billion dollars to a solar company, they printed out the money in $1 bills (you're already creating "green" jobs!), then take 10,000 bills and roll them up into $10,000 logs. You would end up with 100,000 of these "green" paper logs, then distribute the logs to various disadvantaged communites around the country, and have local officials burn the logs in wood stoves, stoves upon which you prepare meals for the homeless and the poor. This idea employs people and feeds the poor. What did we get for the money given to Solyndra? zip. not even a meal cooked on a wood stove.

[ArlJim78]

No merely saying outsourcing is a no no was not the main argument I got. It was blown into Government bad free market good. As usual.
not bad, just wasteful. there are some good intentions, but government programs come with a heavy heavy price tag, much more than you would have with honest competitive bidding. There are no consequences in government for horrible decisions and almost no punishment for outright stealing.

[Robert Goren]

Someone not familiar with the Philadelphia Parking Authority.You are right I am not. I am assuming that it run by some local government and you think it is poorly run. You seem to saying that a private management company could do better to which I reply, you ain't seen nothing yet till you let a private company stick their fingers in the cookie jar. Trust me, I have worked a several of the largest parking management companies(including the 2 largest) in the world. There is no way they would not take whatever local government thats owns those garages to the cleaners. The locals wouldn't know what hit them.

[Native Texan III]

You are right I am not. I am assuming that it run by some local government and you think it is poorly run. You seem to saying that a private management company could do better to which I reply, you ain't seen nothing yet till you let a private company stick their fingers in the cookie jar. Trust me, I have worked a several of the largest parking management companies(including the 2 largest) in the world. There is no way they would not take whatever local government thats owns those garages to the cleaners. The locals wouldn't know what hit them.

That's my experience too.
The private company lobbyists tell the politicians we could do that job better, quicker and cheaper. Politician thinks although I have no clues as to what the "job" is but that is what I am here to achieve.

Private companies enter competition - private sector under private employment conditions - government employees under government conditions. Private companies win work - all fine for first year except complaints are coming in - it turns out they tendered for work they can't actually do as they were hoping to pick up the "expert" government employees that were subsequently fired.

Private companies now making a loss - go back to politicians and ask for a hike in payments which they get, as now no in house competition as Government does not do that type of work any more and no one left in house expert enough to advise that Government is being ripped off - not that politicians who fell for it wan't to admit mistake. It all costs 2-3 times what it could cost in house.

Gullible industry-inexperienced politicians are the main cause, but private sector surely know how to exploit all that and which buttons to press.

Federal and State Government will not start to improve until all company lobbyists are banned from private meetings with politicians and officials and all such communications are freedom of information posted on internet the same day.

[Saratoga_Mike]

You are right I am not. I am assuming that it run by some local government and you think it is poorly run. You seem to saying that a private management company could do better to which I reply, you ain't seen nothing yet till you let a private company stick their fingers in the cookie jar. Trust me, I have worked a several of the largest parking management companies(including the 2 largest) in the world. There is no way they would not take whatever local government thats owns those garages to the cleaners. The locals wouldn't know what hit them.

Did you work for Nashville-based Central Parking? When Monroe Carroll was alive, it was very well run, at the least the Nashville properties. I don't know about now. They owned most of their lots, vs straight mgt contracts. I don't know anything about Standard Parking, the other big player.

[woodtoo]

Was this on your report?


"White House budget officials raised questions about whether they had "sufficient time" to evaluate a 2009 federal loan guarantee to Solyndra Inc., a solar panel maker that recently filed for bankruptcy protection, congressional investigators said Wednesday in a report. "


the above was about a loan made by the feds for over $500 Million back in 2009.

Does it count in your report (from Maddow) that Solyndra Is Going BR.?

Let me explain..."the people stand to lose that $500 Million, since the feds gave them the Money, WHICH makes the cost of Solar Panels very expensive.:cool:

Maybe the feds could make the panels themselves.:p

Cost $6 per panel,sell for $3.

Great investment:bang::bang::bang:

[Tom]

This one might rival Fast and Furious for being Trash-Can Barry's Watergate. Picking up legs much faster than WG did, too.

[mostpost]

That means they are wasting our tax dollars.

BTW, the plant Obama is visiting today - to hawk his save my job bill, is in the process of sending jobs overseas! :bang:
On the one hand you want the Post Office and a lot of other government functions privatized. On the other hand you complain when the government pays to have the private sector do a job.

[hcap]

Another example where government administrative costs are less than that of private companies.

http://healthcarereform.procon.org/view.resource.php?resourceID=004083#II

[Robert Goren]

Did you work for Nashville-based Central Parking? When Monroe Carroll was alive, it was very well run, at the least the Nashville properties. I don't know about now. They owned most of their lots, vs straight mgt contracts. I don't know anything about Standard Parking, the other big player. I worked for Central Parking for a couple of years when they merge with the Texas based Allright Parking in 1999-2000. I did not work Standard. They are third or fourth largest parking company. I worked Ampco, a division of ABM industries. I believe they have over taken Central as the largest parking company at least in the US. Central Parking has a very interesting history. Perhaps sometime I will go in to detail about them.

[Tom]

On the one hand you want the Post Office and a lot of other government functions privatized. On the other hand you complain when the government pays to have the private sector do a job.

Duh. The government should not be in the equation period. Try to pay better attention. Your vessel yearns to be fuller.

[Saratoga_Mike]

I worked for Central Parking for a couple of years when they merge with the Texas based Allright Parking in 1999-2000. I did not work Standard. They are third or fourth largest parking company. I worked Ampco, a division of ABM industries. I believe they have over taken Central as the largest parking company at least in the US. Central Parking has a very interesting history. Perhaps sometime I will go in to detail about them.

I remember when CPC acquired Allright. If I remember correctly, which I probably don't, CPC raised prices at the exact wrong time, hurting the results at Allright.