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NATIONAL ACADEMY OF PUBLIC ADMINISTRATION
Chartered by Congress
The "revolving door issue involves important considerations relating to the
public trust, effective public and private sector management of defense programs,
and the protection of individual freedoms. Congress has attempted over the years
to deal with the issue. Despite these efforts, due to occasional "horror stories"
there is a public perception that the problem continues. Any effective solution
must deal not only with perception but with the operational reality of the
problem, which thus far has escaped definition.
In view of the cost of
implementating H.R. 2554, The Academy recommends that the Committee ask the
GAO to study the issue and define the problem, including the effectiveness of
administration of current applicable law and regulation, and then decide just what
appropriate action by the Congress is required.
The Academy recommends that the numerous existing laws and regulations
on the subject be combined into a single, consolidated legislative framework. The
Academy can bring its unique resources to bear on any aspect of this issue.
January 29, 1986
H.R. 2554, THE "DEFENSE PROCUREMENT CONFLICT OF INTEREST ACT"
January 29, 1986
Mr. Chairman, Members of the Subcommittee:
It is my pleasure to respond to your invitation to the National Academy of
Public Administration to comment on H.R. 2554, the Defense Procurement
Conflict of Interest Act. The Academy, chartered by the Congress in 1984, is a private, non-profit, non-partisan organization of elected membership created in
1967 to conduct studies and provide advice on the problems of government. This
statement represents the views of a select panel of Academy members who have
had long and distinguished careers in the field of federal procurement.
The "revolving door" issue is a significant one involving important
considerations relating to the public trust, effective public and private sector
management of defense programs, and the protection of individual freedoms. The
Congress and the Executive have long recognized the significance of the issue and through the years have attempted to deal with it directly and indirectly through numerous laws, executive orders and regulations addressed to both the
procurement process and conflict of interest requirements.
Despite these efforts, occasional "horror stories" involving post-Federal
employment with contractors continue to be heard, and fuel a negative public
perception of the integrity of the defense contracting process. These perceptions
of wrongdoing not only erode citizens' confidence in government but temper their
willingness to support defense programs.
The continuing concern gave rise during the last session of Congress to the
passage of P.L.99-145 which places certain post-Federal employment restrictions on presidential appointees, and provides the backdrop for today's consideration of
The central question to be addressed concerning the efficacy of H.R.2554 is
whether it effectively addresses a real problem endemic to DOD procurement management. In view of the potential scope and cost of the proposed bill, it is
important to define with some specificity just what is the post-federal employment problem in defense contracting. The Academy panel has been unable
to find a clear articulation
in either the Executive or Legislative branch
the fundamental problem and therefore agrees with the following statement made
by the GAO to the Congress in a 1978 report, and repeated in a second report
dated June 10, 1985:
The extent to which a post-Federal employment
In the absence of information as to the extent to which post-employment
problems exist, it is the Academy panel's view that the Congress ask the GAO to
undertake a comprehensive review of post-employment problems in defense contracting. The results of such a study could affirm that H.R. 2554 is right on
target. On the other hand, it could reveal that the area is adequately covered by
current law and regulation
that the problem is not one of the need for new law
as it is the need for improved administration of current law. Or there could be a
need for both new legislation and improved administration
not only in the
Defense establishment but in civilian agencies as well.
There is some evidence that the administration of current law and
regulation as related to "revolving door" and general conflict of interest may be in
need of some improvement. For example, the GAO in its June 1985 report on DOD defense-related post-government employment found great variations among
DOD agencies in meeting reporting requirements of Section 2397. For another
example, a brief examination of ethics program administration by Common Cause
in 1984 found great variations among the agencies and observed that in certain
cases post-employment restrictions tended to be limited or nonexistent.
To our knowledge, no comprehensive review of the implementation and
administration of relevant statutes and regulations has been made, and we believe
such a review should be part of the GAO study.
One hindrance to effective administration could be the very proliferation
of laws and regulations themselves, leading to the question as to whether it is
time to combine existing law into a single consolidated, legislative framework. A
consistent, comprehensive approach would ease both Executive administration and
Legislative oversight of the process.
The Academy panel recommends that
Congress undertake such a consolidation effort.
If the Committee decides to move ahead on the bill, despite the above considerations, the Academy panel would emphasize that, as currently drafted,
the bill would entail enormous costs for its administration
and trocking on thousands of DOD employees and large volumes of paper from the
DOD and contractors alike:
this at the same time that other Congressional
initiatives are being pursued to cut the costs of government and streamline its
processes. In consideration of the objectives of both H.R. 2554 and government
efficiency, the Committee may want to reexamine the thresholds for coverage in the bill. For example, should contracts covered by the bill remain at $100,000 or be raised to, say, $1,000,000? For example, should employee coverage be defined
solely by procurement function or should an arbitrary cut-off be established at an
appropriate management level, say, GS-14 for civilian employees and the
equivalent rank for military personnel? There is a strong possibility that the
objectives of the bill could be met at much lower cost by a careful, rigorous
examination and determination of appropriaie thresholds. But, again, setting
thresholds presupposes an understanding of the problem.
The Academy panel notes the provision for waiver of selected positions
under certain conditions from requirements of the bill. Such features underline
the importance of effective administration of the bill upon passage, as the
exercise of such waivers are important not only to the management of Defense
programs but to the "revolving door" perceptions of the average citizen and the
Another Academy panel, in its report on the Presidential
Appointee Project which reviewed Presidential appointments during the past five
Presidential administrations, recommended that a legislative ban be placed on the
solicitation or discussion of future employment in the private sector by any
Presidential appointee during the time of his or her appointment. Your committee