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Federal Contractors Are $600 Screwdrivers
ideonexus writes "Last month an article appeared on Slashdot about how the government pays IT contractors twice what it pays its own workers. Missing from the article was how much the IT contractor pays its own workers. After working for a federal contractor for 10 years, a document accidentally leaked to employees by the contractor illustrated the incredible disparity between what the contractor was paying us and what they were charging the government. Like most contracts according to the GAO, the government provided our offices, utilities, computers, and training, leaving our salaries as the only overhead to the IT contractor, giving them an incredible incentive to keep them as low as possible to maximize profits. When the top 100 defense contractors cost taxpayers $306 billion, eliminating the federal contractor middle-man seems like an obvious place to start the austerity measures."
In what world are outsourced IT workers in unions? Talk about putting the blinders on and diverting the issue. This was supposed to be that privatized haven the fiscal right is asking for, turns out the reality is just as crappy as what they complain about.
And yet, there has to be a middle ground. If you give the employer too much power, they take complete advantage of it. If you give the Unions too much power, you can't keep people accountable even for basic tasks and efficiency.
We have to stop saying that any limits on union power mean a return to sweatshops, because that's just as wrong as saying that returning to no unions will fix all of our economic problems.
Unless you're a rockstar, compensation is usually a "take it or leave it" proposition. Especially so in an economy where people are desperate for jobs and will take anything to put food on the table.
Where does the school board find them and why do they keep sending them to ME?
Not every kind of worker is the same. You're an educated person, but a miner, truck driver, or some other low-end worker usually can't negotiate any kind of benefits or anything. Either because no one will hear them, for fear of being fired (or flagged...), or simply because they're too... "uneducated" to know what their rights are.
A company is always bigger than a single person. And a company can afford a lawyer (or an army of them) to screw you, while you usually don't have resources to do that. That's why unions exist.
But unions need regulations, just like companies need regulations. What folks here don't seem to understand is that any "unregulated" area WILL get exploited, and the bigger guy always wins. That's the danger, not "government intrusion".
Been working Federal IT at various agencies for 20 years and the story is the same today as it was twenty years ago. You can't reach high quality/niche programmers on the Federal pay scale in the DC area. Scoff if you want, but we just had a top notch contractor successfully apply and get an offer for Federal work, only to turn down $137K plus bens. Great candidate, couldn't reach his rate. I've seen this time and time again.
That same contractor bills out near $300K per annum.
The system is skewed towards the contracting companies. Keeping Federal IT pay rates down below the industry average for our area guarantees big pay days for the contracting companies. These companies were supposed to be a panacea for the inefficient Federal worker. All that they have become is YAFE (yet another Federal entitlement).
And yes, some of the contractors have been in the same position for DECADES. Same lifetime entitlement.
And you're basing this on what evidence? I see no figures on this.
The fact is, people are pocketing a significant portion of government contract payments, and it's not the people doing the actual work. It's the guy in the suit who "manages" the teams, and says "You let ME worry about that" to everything while driving a fucking $200,000 Mercedes.
The unions and payroll have absolutely nothing to do with the inflated cost of government contracting, they're just an easy target recently vilified by the far right and other class-warfare commencing scumbag motherfuckers. So go join your party on the right, tea bagger.
For what it's worth, most union dues/benefits are paid for by the employee themselves through dues and fees. It is a rare occurrence that an employer takes care of all the costs.
Pensions are a stupid employment incentive all around, but it's not the unions' faults. Keep paying people's salary even after they retire? Yeah, that's a marvelous idea for the bottom line.
If the only way you can accept an assertion is by faith, then you are conceding that it can't be taken on its own merits
If you remember the stories about the $600 hammers, and you actually read the details, what you find out is that the hammer cost $10, and the contracting overhead cost about $500. That includes all the rules for government procurement, Federal Acquisition Regulation compliance, EEOE, small and woman/minority owned business requirements, limits on subcontracting, requirements for exhaustive financial/time accounting, etc, etc, etc.
Most of those overhead requirements are placed for good reasons, either for social policies (e.g. small business/minority business) or for fiscal or technical accountability (e.g. time accounting, facility security, etc.) But when you add them all up, you have a lot of overhead for doing government contracting that you don't have in business. It's part of the reason why government is inherently inefficient.
So the answer is outlawing unions and having all workers negotiate their own contract terms?
No, but there should be a middle ground.
Unions are good, but this whole "protect every employee at any cost" thing has to go. Outlawing the union is going way too far in the other direction, but there has to be a better solution.
Personally, I think that these claims that people are impossible to fire are largely made up. Maybe people are difficult to fire, but impossible? As for punching his boss in the face, I certainly don't have all the details (or any of them, really), but I'll bet there's more to that story. Certainly, if the guy punched his boss for no reason, he'd be arrested for assault and battery and I'm guessing he'd be easy to fire, union or not.
I was a government IT worker in the U.S. Treasury for decades. Before I retired, contractors were being brought in to replace workers in my position. One guy comes to us fresh from a front-line support position at, believe it or not, Best Buy. After a long while, he turned out to be not so bad, trainable, and useful. It took about a year to get him up to speed.
At some point, he decided he trusted me enough to talk about pay. I was shocked. Why should he treat salaries as some sort of secret? As a public employee, my pay is known to anyone who wants to look it up. I showed him how to look up what anyone in the organization made, showed him my salary, and couldn't imagine why anyone would think of this stuff as proprietary information.
In his case, though, I can see why his employer had gone to great pains to create the impression that salaries were some kind of secret. He was doing the same work as a first-tier support employee but was being paid roughly one-fourth as much money. The contract to his employer was sufficient to support employees like me (the agency was paying roughly twice the annual salary of a senior computer specialist for each contractor who reported to a job site) yet the contractor simply took the contract, took a cut, and subcontracted the rest out. The subcontractor took a cut and subcontracted the rest out. The next level subcontractor took a cut and hired an out-of-work Best Buy leftover to report to the job for a pitifully small percentage of the original contract payment.
It was a multi-level sham. I was annoyed at the waste. The contract guy was annoyed that he wasn't making any more money. Overall, contracting for these positions was a completely stupid thing to do that only accomplished just one thing - slicing off shares of pure profit to a few middlemen. Ultimately, the workers on the ground and their customers got screwed and the U.S. government got a *very* poor return for the money spent.
Naturally, once the guy was fully trained and providing real value to the organization, budget cuts forced cancellation of the support contract and he was gone in a flash. All that training time, all that productivity diverted from helping customers to bringing him up to speed was, in an instant, flushed down the toilet.
I'm sure it's not always the case, but contracting for services like this by the government is, in every case where I've gotten a close look, a completely stupid thing to do.
The way contracts work in the government is that usually they have a specific contractor they want to use anyway. So they'll word the contract in such a way that only that specific contractor can meet all the requirements. Same goes when they want to hire a specific person. Because of government regulations, they have to have an open competition for contracts and positions, but many times they already know who they want to work with. On one hand it's unfair to the others who want the contract or job. On the other hand, it's a lot less risky for them to pick somebody they know will get the job done (regardless of the cost) over someone they have never worked with before.
Anthropic principle: We see the universe the way it is because if it were different we would not be here to see it.
All I read in your post was this:
I come from a middle-class family, there was always food in my table and growing up was easy, then I started working and was always happy with my paycheck, and I even found ways to avoid overpaying taxes. I don't see why people say they can't find jobs... you just go somewhere and say "hi, here's my qualifications, i want a job" and you get it. It's not so difficult.
Which is fine, except that in real life there are other factors, like genetically stupid people, or people who didn't have proper nutrition as children, or whose mothers drank, smoked, or did drugs during pregnancy. Or teenage mothers, or many other factors that automatically get you out of the American Dream elegibility.
If you stop for a minute and think that, gee, not everyone is like you. Not everyone can negotiate, can afford to "meet people", or HEY! they don't even have the kind of job you are doing (I doubt a walmart cashier can benefit of "getting in touch with people", since she's probably there because she can't do anything else.)
(BTW, i'm from a middle-class family, I have a decent living, I got my "gigs" by meeting people, etc. But I also have empathy for other people and I can see why things are the way they are. It's either that, or we kill all idiots, "they're useless anyway")
Well, if unions in the USA are as powerful as The Incredible Hulk, they must be doing a really sloppy job. After all, you're among the countries with the highest income inequality among developed nations. And it keeps rising.
I suspect this anti-union rhetoric that floods Slashdot all the time is more a product of decades of brainwashing from the part of the corporate media propaganda machine.
In my country (Portugal), unions are pretty weak. That's one of the reasons (but not the only, mind you) we have incredibly shitty pay compared to countries where unions are powerful like Germany and France. And it hasn't helped us at all to have weak unions. Our productivity is still very low, although we work more hours than the other Europeans. Our country is bankrupt. And our managing class is one of the most illiterate, lazy, loutish and well-paid in Europe.
"You don't actually think they spend $20,000.00 on a hammer, $30,000.00 on a toilet seat do you?" - Independence Day, 1996
See, this is the thing. Golden Fleeces were being handed out, fingers pointed, voices of indignation were hollering at every microphone and camera they could find - it was like a scene out of Bloom County - so preposterous and yet happening.
Forward a few years and instead of buying a special model of hammer or seat meeting a particular specification, we now have contracted out an enormous amount of work - and from what I've seen, a lot of the result is garbage - it's far worse now than $600 toilet seats. The contractors who flooded Iraq were taking home tons of money, while much of the work was done by sub-standard hires - and we saw some of the results in the news, but Cheney's old company made a sickening haul and nobody seemed to do more than bat an eye at this seeming corruption - Just how was it that Halliburton was awarded a giant no-bid contract, because they were the only company seen to be prepared to handle it? Talk of inside information .. there must have been a conversation including something like this from Cheney, "Get oil, security, contruction, everything ready now, because we're going to invade Iraq in a year and if you are ready, we give you a fat no-bid contract, OK?"
Old advice, too, from someone in my past - if you want to make money, get contracts for government - education, too. You can sell rubbish which you could never get away with in the private sector markets.
A feeling of having made the same mistake before: Deja Foobar