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Legacy Content / RULES OF THE GAME

The Difficulty Of Walking The Line

Daschle Is Gone, But Lynn Nomination Raises Further Ethics Questions

February 9, 2009

The flap over Tom Daschle may be dying down, but ethics questions continue to dog another controversial Obama nominee, former Raytheon lobbyist William Lynn.

Like the uproar over the former Senate majority leader's candidacy for Health and Human Services secretary, Lynn's nomination for deputy Defense secretary points up the direct conflict between the new president's stated policies and his Cabinet selections.

Daschle's unpaid taxes and lucrative health industry consulting work derailed his nomination to head HHS. Lynn's work as a defense industry lobbyist weighing in on military appropriations and acquisitions policy has riled government watchdogs and raised conflict-of-interest questions on Capitol Hill.


The Lynn controversy underscores Obama's challenge in barring the door to lobbyists when, in fact, some K Street veterans have valuable Washington experience.

In Lynn's case, the Obama administration appears to be sending mixed signals over how it will handle federal procurement contracts, which have been a growing magnet for fraud and abuse. At a recent hearing before the Commission on Wartime Contracting in Iraq and Afghanistan, Defense Department inspectors painted a bleak picture of the criminal and management problems plaguing tens of billions in contracts for rebuilding and war efforts in Iraq.

"Lack of adequate oversight and surveillance has led to waste and abuse on DOD contracts," Thomas F. Gimble, principal deputy inspector general for DOD, told the bipartisan commission. Gimble cited 154 open criminal investigations involving allegations of bribery, defective products, rigged bids and conflicts of interest in Iraq, Kuwait and Afghanistan.

It's precisely this type of abuse that Obama has pledged to prevent. As a candidate, Obama promised in his Blueprint for Change to "create a 'contracts and influence database' that will disclose how much federal contractors spend on lobbying, and what contracts they are getting and how well they complete them."

Obama's January executive order outlining ethics rules for executive branch personnel also contained a little-noticed but potentially significant provision involving federal contracting disclosure. The order directs the head of the Office of Management and Budget to report to the president on "steps the executive branch can take to expand to the fullest extent practicable disclosure" of executive branch procurement lobbying.

The order also directs federal officials to report to Obama on how to expand the revolving-door ban on executive branch employees involved in the procurement process who return to the private sector.

"That to me indicates a warning, or a red flag, that there is going to be a federal procurement lobbying disclosure [regime] and restrictions that don't exist currently," said Stefan C. Passantino, who heads the political law team for McKenna Long & Aldridge. "And that's something that anyone involved in federal procurement is going to want to be watching and looking for."

Some good-government advocates hailed the executive order as a signal that Obama will finally pull back the curtain on the sometimes shadowy procurement process, which enables contractors to bypass OMB or government acquisitions officials and appeal directly to lawmakers or top executives.

The most notorious recent abuse involved Air Force acquisition official Darleen Druyun, who went to prison after admitting that she favored Boeing in a deal involving an aerial refueling tanker even as she was negotiating a job with the company.

If adopted, the Obama disclosure blueprint "would be unprecedented, and it would be extremely laudable and helpful to track the influence peddling that occurs when money is distributed," said Gary Bass, executive director of OMB Watch.

But some argue that the executive order amounts to tinkering, and that it's undercut by Lynn's nomination to a top Defense Department post. What's really needed is disclosure requirements for executive branch officials who meet with contractors, as some on Capitol Hill have proposed, said Scott Amey, general counsel for the Project on Government Oversight.

"Although it's a positive step forward, it's not the giant leap forward that we were all hoping for, based on campaign speeches," said Amey. He added that Lynn's nomination "does raise the question: Are we just going to get government as usual, or is there a real consensus to change the culture within the government?" POGO has called on Obama to withdraw Lynn from consideration.

Sen. John McCain, R-Ariz., who has led the charge to clean up military contracting, and who railed against abuses as the GOP nominee for president, has grilled Lynn on whether he'll recuse himself at DOD from matters he handled as a defense lobbyist. In an exchange of letters with Lynn, McCain has cited "conflicts-of-interest" concerns involving Lynn's Raytheon work.

The controversy underscores Obama's challenge in barring the door to lobbyists when, in fact, some K Street veterans have valuable Washington experience. Indeed, some experts argue that Obama's emphasis on ethics and penalties overlooks the real problem, which is procurement staff shortages, and will drive away the very acquisitions experts he needs to fix the broken contracting system.

"We have more than enough rules," declared Steven L. Schooner, co-director of the government procurement law program at George Washington University Law School. "The problem isn't the rules. We have implementation problems. And our primary problems are people, and leadership."

It remains to be seen whether Lynn's answers will satisfy McCain and others on Capitol Hill who have questioned his nomination. In the meantime, the Obama administration may have to brace itself for another round of ethics wars.

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