California to Cancel Oracle Deal

ShaunC writes "Back in mid-April, the state of California bought $95M worth of Oracle software, which turned out to include more licenses than the state has employees, at a taxpayer cost of $41M more than necessary. Now, CNet is reporting that the contract is being cancelled. Oracle apparently made a $25K donation to governor Gray Davis' campaign fund after the sale was made, several state officials have been suspended, and a criminal investigation into the deal is already underway."

Comments

the donation is not a smoking gun

[jonbrewer]

"Oracle apparently made a $25K donation to governor Gray Davis' campaign fund after the sale was made, several state officials have been suspended, and a criminal investigation into the deal is already underway."

If anyone really thinks that a $25k donation would have anything to do with a $95,000,000.00 deal for software, they need to get reacquainted with reality. $25k is nothing unusual. It's a Red Herring, and doesn't belong in an informed discussion on the Oracle/California mess.

Re:the donation is not a smoking gun

[ShaunC]

$25K may be but a drop in the bucket, but it's money regardless. According to the article, the contribution was made just after the Oracle deal closed, and the official who accepted the contribution resigned. I'd say there's certainly a tie-in somewhere. If not, something stinks even worse.

I wrote the submission text. For the record, I'm a democrat. I have nothing against Gray Davis and I wasn't trying to make a subliminal political statement by mentioning the contribution. Payola is payola, no matter which party and no matter who the contributor.

Shaun

Re:the donation is not a smoking gun

[garver]

But that's the beauty of lobbying the government! You make "donations" in the $1000s to influence purchases in the millions. Talk about a return on investment!

Its naive to think this doesn't or wouldn't happen. One, the temptation is just too big (spend a thousand, get a million). Two, who's going to prove it? Even if there are strings attached to the money, which would be illegal, its very easy to say publicly that there weren't. Three, read the papers lately? There is allegation after allegation of this stuff happening. From this mess, to Enron and the Bush administration, to Clinton and pardons, and to every congressional member and their pork projects.

Bottom line: Elected officials carry an enormous amount of power and responsibility when compared to how much they are paid legally. That's a recipe for bribery and for attracting those willing to be bribed.

This is what campaign finance reform is supposed to fix. But I don't support it; I don't think any amount of campaign finance reform will fix the situation. You need to motivate officials to be honest. I don't know how to do that, but I'm certain adding more rules won't. Until someone comes up with something better, I would rather keep my "freedom of speech".

Re:the donation is not a smoking gun

[pnatural]

I don't follow CA politics. In fact, I had to google "Gray Davis" to find his party affiliation.

My problem with most media -- specifically scandal reporting -- is that when the scandal involves a Dem, invariably that fact is left out.

Had Gray Davis been a Republican, or worse yet, a conservative, I'd bet you my last dollar that the headline would be something similar to "New Scandal in Republican Governors Office".

Call me a nut, dismiss my option: I don't care. But the next time you're watching CNN and they talk scandal, remember what I said here. Then listen to the talking head very, very closely and tell me I'm wrong.

Re:Who pays ?

[Kamel Jockey]

but I bet the tax payer has to dig yet deeper to pay for bailing out of the contract

You are most definitly correct. Oracle will most definitly sue CA for breach of contract. This will most likely lead to a multi-million dollar settlement which CA's taxpayers will have to pay. In the end, Oracle will make out like a bandit because they would have made the settlement money for doing nearly nothing, since breaking the contract no longer obliges Oracle to provide any goods/services.

This kind of BS has happened before, it will happen again. A few years back, Pennsylvania entered into a $200 million+ contract with an emissions testing company to inspect peoples' cars. When the administration changed, the commonwealth terminated the contract and ended up paying $80 million or so in breach of contract costs.

Re:Oracle arrogance

[joss]

> All companies make contributions to political fundraisings. This is nothing new or unethical.

It's not very new, but I don't think it's ethical.

A company is legally obliged to maximize shareholder profit. This means that it is effectively illegal for a company to make a decision on ethical grounds. For the donation to be legal anything, they must have reasonable grounds to believe they are getting somthing in return.

The argument that money is speech is rather preposterous, but even if one buys it, it doesn't make corporate political donations OK. If companies had the same constraints, eg if they could be jailed or executed, then maybe they would deserve the same rights as individuals.

http://www.corporatewatch.org/pages/corporations .h tml

Re:Oracle arrogance

[totallygeek]

Name one publicly traded company that has not given money to political organizations. Name any company in the Fortune 500 that doesn't have a tie to a Washington lobbying interest. You are naive to think that companies don't spend money to political ventures.