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Hasty stimulus spending may waste billions, experts say

Jump-starting the economy quicker than agencies can oversee it may result in cost overruns, experts say.

February 09, 2009|Washington Post

WASHINGTON — The Obama administration's economic stimulus plan could waste billions by attempting to spend money faster than an overburdened government acquisition system can manage and oversee it, according to documents and interviews with experts.

The stimulus legislation under debate in Congress includes provisions aimed at ensuring oversight of the massive infusion of contracts, state grants and other measures. At the urging of the administration, those provisions call for transparency, bid competition, new auditing resources and new oversight boards.

But under the terms of the stimulus proposals, a depleted contracting workforce would be asked to spend more money more rapidly than ever before, while also improving competition and oversight. Auditors would be asked to track surges in spending on projects including bridges, schools, "green" energy and electronic health records -- a challenge made more difficult because many contracts would be awarded by state agencies.

The stimulus plan presents a stark choice: The government can spend unprecedented amounts of money quickly in an effort to jump-start the economy or it can move more deliberately to thwart the cost overruns common to federal contracts in recent years.

"You can't have both," said Eileen Norcross, a senior research fellow at George Mason University's Mercatus Center who studied crisis spending after Hurricane Katrina. "There is no way to get around having to make a choice."

Since 2000, procurement spending has soared about 155% to almost $532 billion, while the number of employees who oversee such spending rose about 10%.

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