In 1996, under the rubric of ‘reinventing government’, the
Clinton-Gore Administration decided that some functions of government that were
previously defined as “inherently governmental” were now appropriate to be
outsourced to the private sector. At
that time The Office of Personnel Management (OPM) was responsible for
conducting security clearance investigations for most Federal agencies. This function was selected for privatizing.
According to Bloomberg.com:
….The unit, originally known as U.S. Investigations
Services Inc., was privatized in 1996 as part of then-Vice President Al Gore’s
effort to “reinvent” government by reducing the size of the civil service,
according to a 2011 report
by the Congressional Research Service.
Contracting
out security reviews was designed to help save the government money and secure
new work for about 700 investigators who would no longer be needed because of a
declining security clearance workload due to the end of the Cold War.
USIS was given a non-competitive, three-year contract
for investigative work with the government personnel office and granted free
access to federal computer databases that weren’t available to other firms.
The Carlyle Group
LP, a Washington-based private equity firm, and New York-based
Welsh, Carson, Anderson & Stowe LP invested in USIS. They agreed in 2007 to
sell USIS to Providence, Rhode Island-based Providence Equity Partners for
about $1.5 billion. 1
That was then.
Now, it appears that USIS may have been cheating on the
investigations2. To meet the
contract performance criteria (and to earn executive bonuses), it is alleged
(by a whistleblower and the Department of Justice) that they engaged in
practices that did not fully complete the work on investigations, perhaps on as
many as 600,000 investigations. They
allegedly provided false information to OPM, and to the agencies that made the final decisions about granting clearances to candidates.
It appears that USIS conducted the clearance investigations for
the Navy Yard shooter as well as for Snowden.
The Navy Yard murderer of 12 federal employees and contractors, had enough documented derogatory information
about his military misconduct, arrests, and mental problems that should have
been discovered through a THOROUGH investigation. The same level of quality work may also have been true for Snowden. At this point these specific allegations have
not been proven, but it will be played out in court in the coming months. However, there have been proven fraud cases
involving USIS and other investigation contractors where employees filed false
reports, including one that claimed to have interviewed a person who died 10
years earlier.
So, here we have ‘reinvented government’ using contractor
employees and managers who earn bonuses, and investors who earn returns by ‘just’
doing the job that federal employees formerly did ‘just’ for their
GS-salaries. So, it isn’t necessarily
CHEAPER. The lure of bonus money and returns on investment for this now - $1.5+ billion
dollar industry doesn’t necessarily yield BETTER results either. It seems to me that the only thing that has been achieved are the political bragging rights
for appearing to have “reduced the size of government”.
Before we fix or reinvent a dysfunctional thing, we should make
sure we understand the root cause of the thing’s dysfunction, before we get on
the Road to Abilene3. Clinton-Gore
put us on the road. I’m not sure if you
agreed to go. I didn’t, but here I am,
looking for a way to get back home from Abilene.
1 http://go.bloomberg.com/political-capital/2013-09-19/usis-navy-yard-shooters-background-check-wasnt-ours-others-silent/)
3 http://en.wikipedia.org/wiki/Abilene_paradox
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