Or How I Learned to Stop Worrying

The moment Lurita Doan walked into the "brown bag"  meeting on January 26, 2007 at the GSA headquarters, her career as a government servant was in jeopardy. The moment it became public that Scott Jennings, White House deputy director of political affairs, gave a Powerpoint presentation (warning: large file) on 2006 election polling data and GOP political strategy in 2008, Lurita had a choice to make. She did not choose wisely.

As you may recall, I wrote a post about my personal view of Lurita before she testified in front of Congress earlier this week. In the post, I expressed my disappointment that she was alleged to be involved in this scandal but I had also reserved judgment until after the hearing. Now the hearing has passed and I want to share with you my views on the matter.

Lurita stated at the hearing that she felt that she was living out the movie "Mr. Smith goes to Washington". After her opening statement, I wanted to believe that to be true. However, under intense questioning a different picture began to emerge. When it became clear that the White House was practicing partisan politics inside GSA premises, Lurita’s response was to be non-responsive. By doing so, that is, by deciding to protect the White House, she did her country a disservice this week. She chose partisanship over her country and her integrity. As someone who has admired and respected Lurita, I felt deep shame.

While it is not clear that Lurita violated the Hatch Act by her actions, this was never about getting off on a technicality. The issue has always been the American people’s right to expect their government to work for them, and not for a political party. That right of the American people should be self-evident, with or without the Hatch Act.

Lurita asserted that she was engaged in "team building" and that political appointees are tasked with carrying out the policies of the White House. However, there is a significant difference between "policies" and "politics". There is nothing wrong with political appointees setting policy direction on behalf of the president of the United States - that is their right, and in fact, their duty. However, when the GSA administrator and senior level staff at the GSA are engaged in plotting or discussing political strategy - that is, planning how to win elections for their political party - they are no longer acting as public servants, they are acting as political hacks. By doing so, they have in effect hijacked the machinery of the US government for the benefit of a political party. The crime is larger than the Hatch Act - the crime is a high crime and misdemeanor. The accused must include the head of the political party that perpetrated the offense, that is, the President of the United States.

In her short tenure at the GSA Lurita had done much good for the troubled agency. She had attempted to cut waste and spending. She tried to take on entrenched interests such as NASA SEWP, but failed. I also believe she did the right thing in getting the Sun Microsystems contract renewed. She would have made Mr. Smith proud.

However, in the end, she could not escape the cult of the "loyal Bushies". In the end she put loyalty to the President above loyalty to country. She made her choice. In doing so, she disappointed those of us who labored under her and learned much from her.

I take no joy in this turn of events. I wish it were not so. Yet there it is. Undeniably so.

Today the Washington Post reported that Lurita Doan, the GSA Administrator, will testify this coming Wednesday in front of the House Oversight and Government Reform Committee about recent reports of her involvement in the politicization of the GSA. The charges are serious and, if substantiated, she would be removed from her position in violation of the Hatch Act.

Before I discuss this latest scandal, I want to share my personal experience with Lurita Doan. I will warn the reader that I have a positive opinion of Lurita, and I ask that you take my bias into consideration when you read the following. Though we differ in our political views, I have immense respect for Lurita.

Lurita became the first female GSA Administrator on May 31, 2006. Before becoming GSA Administrator, she was the founder and sole owner of New Technology Management, Inc. (NTMI), a small federal contractor located in Reston, Virginia. She sold NTMI before becoming GSA Administrator.

I started working at NTMI in November of 2002. I worked there for four years. For part of my tenure there I led the technical staff in designing and developing a large-scale software application that helps detect and eliminate fraud for a large government agency.

During my time at NTMI I came to admire and respect Lurita. In a bit of coincidence it turned out that she and I attended the same college, ten years apart. Lurita is one of the most dynamic and charismatic people I have ever known in my life. She may also be the most driven and hardest working person I have had the pleasure of knowing. She has been a mentor to me and has been very supportive of me during my time at NTMI. In my long career in the IT industry, she is one of the few CEOs I have met who earned my respect for her honesty, her hard work, and her ability to communicate effectively and build rapport at every level in the company. I am grateful to have known her and have learned much from her.

Lurita is also nothing if not blunt. She will tell you what she thinks and has a very low tolerance for excuses. When she is in a room with you, she commands and demands attention by the sheer force of her personality. Her bluntness has made her many enemies in her short tenure in the government.

Those of us who worked at NTMI knew that Lurita was a long-time supporter of the Republican Party and the Bush Administration. In fact, she was one of the speakers at the 2004 Republican National Convention. She has also met with Mr. Bush as a woman small business owner in 2004 and was cited by Mr. Cheney in his speech at the Small Business Administration in 2003. So, it did not come as a surprise when she was nominated for the position of GSA Administrator.

However, unlike companies like MZM (which I wrote about yesterday) and their meteoric rise, NTMI’s business did not benefit from Lurita’s Republican Party ties. A look at NTMI’s contracts will show the less than stellar performance by the company over the last six years. I should know - I slaved over preparing many responses to RFPs only to be outbid by companies offering a better price or with more experience or leverage. NTMI’s fortunes dwindled when the company graduated from 8(a) status (the graph of NTMI’s revenue trend here will leave no doubt when NTMI graduated from 8(a) status). NTMI struggled, like other government contractors (with the exception of MZM and other shady outfits), to compete for bids in full and open RFPs against much larger and well established companies such as SAIC, EDS, CSC and others. It was an uphill battle in this competitive environment and NTMI suffered as a consequence.

Lurita has been a champion of women and minorities in business. Her appointment to the post of GSA Administrator was supposed to be a step forward for advancement of minorities and women in government. It was widely expected during her Senate confirmation that she would bring her energy and her drive to the GSA after a scandal-ridden period in the agency’s history.

Lurita replaced Stephen Perry as the GSA Administrator. Mr. Perry, you will recall, resigned in October 2005 in the wake of the Jack Abramoff scandal. Mr. Perry resigned two weeks after David Safavian, Perry’s chief of staff, was arrested for obstructing justice and his connections to Jack Abramoff. I should note that it was during Mr. Perry’s tenure that companies such as MZM, with no experience or revenue, mysteriously obtained multi-million dollar blanket purchase agreements.

Lurita was expected to clean up the mess at GSA:

Investigations in 2003 revealed the agency’s procurement organizations, particularly its Federal Technology Service regional shops, had parlayed their reputation for quick turnaround with few questions asked into a scandalous misuse of technology contracts.

…

Doan, who stepped in more than half a year after Perry quit on Oct. 31, 2005, was expected to clean up the mess. She seemed primed for the job.

 

Doan exudes energy. She leans forward to emphasize points. She gesticulates. She visibly reacts with displeasure or pleasure. Her voice grows animated. She groans audibly when she hears something or encounters someone she doesn’t like. She is not shy.

 

But within weeks of her Senate confirmation, she picked a fight with NASA over the future of its Scientific and Engineering Workstation Procurement. She was accused of saying that the GSA inspector general’s staff "terrorized" regional administrators. She angered an already irritated Defense Department by resisting limitations on using Defense dollars.

…

Despite her energy, some of Doan’s efforts have backfired. The Office of Management and Budget renewed NASA’s governmentwide procurement contract and told her to "avoid unnecessary discordant publicity on this matter." Late last year, she capitulated to the Pentagon on how quickly its funds must be disbursed.

She picked the wrong people to pick a fight with in trying to eliminate government waste. She may have also made some political enemies inside and outside GSA who were accustomed to the Bush Gravy Train:

Contracts specific to a department or function of government, such as the Navy’s Seaport, a 2004 IT contract, and the Homeland Security’s Enterprise Acquisition Gateway for Leading Edge Solutions, an indefinite-delivery, indefinite-quantity technology acquisition, compete with GSA. For years, agencies other than GSA have run technology contracts open to all agencies. Doan contends they waste tax dollars.

 

"We just don’t want duplications," she says. "If it’s a unique requirement that’s being supplied by a particular [agency’s governmentwide contract], that’s fine." Otherwise, procurement should go through GSA, Doan says. Only GSA covers its costs by collecting fees as opposed to using appropriated funds, she asserts. Other agencies might say they’re not using appropriated money to support contracts open to all, "but unless you absolutely carve out your costs for your rent, you carve out your costs for the air you breathe, practically . . . then there’s an added burden to the taxpayer," she says.

I always suspected she would make powerful enemies with her style. She picked a fight with the biggest guy in the schoolyard - the Defense Department contracting office. It was probably a matter of time before she was pushed out.

Immediately after her tussle with DOD and NASA, articles appeared in the Washington Post about her falling out with the GSA IG and her attempt to offer a $20,000 contract to a long-time friend. Now the scandal has gone into overdrive because White House political staff were coaching GSA political appointees in a videoconference that was presided over by Lurita. This latest scandal reeks of the same politicization of the government that the U.S. attorney scandal reeks of. Given the central role GSA has played in the Jack Abramoff scandal and in the Duke Cunningham/Gonzogate scandal, it rings true that the White House is involved in across-the-board politicization of government.

I am disappointed that Lurita is alleged to be involved in the latest scandal. I eagerly await Congressman Waxman’s hearing this Wednesday to learn more. I do hope the investigation does not stop at Lurita. I expect, like in Gonzogate, that the Congress will hold the White House accountable and not be satisfied with being thrown scraps. With her blunt style and her immediate attack on government waste she is ripe to be thrown overboard by this White House as scrap.

Finally, I wrote this diary, from a personal point of view, partially because I saw an alarming diary on Daily Kos that called Lurita an unconscionable name. I hope, as we continue to ferret out corruption in the Bush Administration, that we do not lose sight of who we are and what our mothers taught us.

Thanks for reading, and now let the flaming begin.

When Carol Lam, the US Attorney for the Southern District of California, was publicly humiliated and dismissed by the Bush Administration on December 7, 2006, she became the latest casualty in George W Bush’s "War on Terror". The "War on Terror" is multi-pronged. It consists of the wars in Iraq and Afghanistan, the war against al Qaeda, and the war of profit and political favors. It was the war of profit and political favors that killed Carol Lam’s career.

This is the story of one of the warriors of greed and profit. This is the story of the warpath of dollars that leads all the way to the White House.

The reason being floated by the Administration for Carol Lam’s dismissal is her alleged lax pursuit of immigration cases. Congressman Darryl Issa has attacked Ms. Lam on her office’s prosecution of immigration misdemeanors prior to her firing, and that attack is being now spun as a cause for her dismissal. However, it is clear from the emails released by the Justice Department that the Department was aggressively defending Ms. Lam and considered Mr. Issa something of a pest.

It is ironic that Darryl Issa, who has been arrested multiple times for gun possession and auto theft, should pursue Carol Lam for exercising prosecutorial discretion in deciding whether to pursue misdemeanor offenses. If the prosecutors had not exercised prosecutorial discretion in the cases involving the Congressman, Mr. Issa would likely have seen some jail time. But I digress.

Politics however is sometimes fought as asymmetrical warfare. The most plausible speculation about Carol Lam’s dismissal is that she was fired because of her prosecution of Duke Cunningham and the possibility that the ongoing investigation was starting to come too close to the White House. Darryl Issa, a defender of Duke Cunningham to the end, may have been prosecuting a flanking maneuver.

The smoking gun tying Carol Lam’s firing to the Duke Cunningham case seemed to be contained in an email from Kyle Sampson:

The U.S. attorney in San Diego notified the Justice Department of search warrants in a Republican bribery scandal last May 10, one day before the attorney general’s chief of staff warned the White House of a "real problem" with her, a Democratic senator said yesterday.

The prosecutor, Carol S. Lam, was dismissed seven months later as part of an effort by the Justice Department and the White House to fire eight U.S. attorneys.

…

Sen. Dianne Feinstein (D-Calif.) said in a television appearance yesterday that Lam "sent a notice to the Justice Department saying that there would be two search warrants" in a criminal investigation of defense contractor Brent R. Wilkes and Kyle "Dusty" Foggo, who had just quit as the CIA’s top administrator amid questions about his ties to disgraced former GOP congressman Randy "Duke" Cunningham.

The next day, May 11, D. Kyle Sampson, then chief of staff to Attorney General Alberto R. Gonzales, sent an e-mail message to William Kelley in the White House counsel’s office saying that Lam should be removed as quickly as possible, according to documents turned over to Congress last week.

"Please call me at your convenience to discuss the following," Sampson wrote, referring to "[t]he real problem we have right now with Carol Lam that leads me to conclude that we should have someone ready to be nominated on 11/18, the day her 4-year term expires."

Since that revelation the issue has been much clouded by the raising of the immigration issue. But where there is smoke, there is likely to be fire - especially when the Bush Administration is involved.

Duke Cunningham was being bribed by MZM, a company run by Mitchell Wade. It has emerged through the hard work of Talking Points Memo and Think Progress that MZM got its start in government contracting and the bribery business in a most unusual way:

– Wade’s company MZM Inc. received its first federal contract from the White House. The contract, which ran from July 15 to August 15, 2002, stipulated that Wade be paid $140,000 to “provide office furniture and computers for Vice President Dick Cheney.”

– Two weeks later, on August 30, 2002, Wade purchased a yacht for $140,000 for Duke Cunningham. The boat’s name was later changed to the “Duke-Stir.” Said one party to the sale: “I knew then that somebody was going to go to jail for that…Duke looked at the boat, and Wade bought it — all in one day. Then they got on the boat and floated away.”

Of course, the big prize for MZM followed the very next month:

The money and gifts MZM gave Cunningham were a small price to pay for the ultimate prize. In September 2002, the General Services Administration signed a so-called blanket purchase agreement with MZM totaling $250 million over five years.

So, the facts are a company (MZM) gets its first contract from the White House, gets paid $140,000, and two weeks later spends $140,000 to bribe Duke Cunningham, and the very next month gets a $250 million dollar contract from the Defense Department. That kind of meteoric rise is unheard of in government contracting. Add to that the fact that MZM was the only bidder for a $250 million dollar contract from DOD, and you have the makings of major corruption. Anyone who has ever bid for a government contract, especially a $250 million dollar contract that was a full and open bid, knows that everyone who is anyone in government contracting would have bid for such a lucrative contract.

When the Pentagon noticed that they had handed out such a large contract without a competitive bidding process, they apparently stopped any new work on the contract. That Pentagon decision, in June 2005, came the same week that the relationship between Duke Cunningham and MZM became known:

The Pentagon has ordered a halt in new work for MZM Inc., a local defense and intelligence firm, under a contract that has brought the company $163 million in revenue during the past 2 1/2 years.

A Pentagon spokesman said in a statement that the decision to cut off further awards for MZM under the 2002 contract, known as blanket purchase agreement, was because of a change in procurement law.

Rep. Randy "Duke" Cunningham (R-Calif.), a member of the House defense appropriations subcommittee, acknowledged last week that his relationship with MZM founder Mitchell J. Wade is being examined by federal authorities.

The story so far is quite damning. But, it is far from complete.

The contract MZM received from the White House for $140,000 was not an isolated contract. That contract was part of a Blanket Purchase Agreement (BPA) that MZM signed with the GSA on May 13, 2002 [Click here for a PDF of the GSA schedule for this BPA]. In addition to this BPA, MZM rode the gravy train on two other BPAs. The three BPAs are as follows:

• GSA BPA contract number GS-35F-0486M effective May 13, 2002 to May 12, 2007
• GSA BPA contract number GS-10F-0392R effective July 19, 2005 to July 18, 2010
• DITCO contract number DCA20002A5016 effective sometime in September, 2002

Between 2002 and 2006, when MZM was ostensibly sold (more on that later), the company was paid over $176 million mainly under GS-35F-0486M and DCA20002A5016. A company that made no money before 2002, made $140,000 in 2002, over $43 million in 2003, over $69 million in 2004, over $60 million in 2005 and over $3 million in a few months in 2006 before the company was sold.

The White House got the ball rolling in 2002 under GS-35F-0486M. In 2004, the Executive Office of the President also paid MZM a total of $421,474 ($50,115, $92,161, $112,161 under DCA20002A5016 and $167,037 under GS-35F-0486M) for "intelligence services" .

On February 24, 2006, the government secured a guilty plea from Mitchell Wade, the head of MZM. Wade pleaded guilty to funneling $1 million in bribes to Duke Cunningham. In the plea agreement Wade admitted to bribing the DOD Program Manager on the DITCO contract (DCA20002A5016) by hiring the Program Manager’s son and later hiring the Program Manager at MZM. In return MZM received favorable reviews and inside information that helped secure contracts for MZM under the BPA.

As I mentioned earlier in this post, the Pentagon claimed in June 2005 that they would not award any further work to MZM under the DCA20002A5016 BPA. However, government records show that MZM was awarded multiple task orders, amounting to millions of dollars, in fiscal year 2006 on the BPA.

On July 18, 2005, while MZM was being investigated for bribery and after the Pentagon claimed to have cut off the DCA20002A5016 gravy train, the GSA awarded MZM with a $2,250,000 blanket purchase agreement (GS-10F-0392R) for the MOBIS program [Click here for a PDF of the GSA schedule for this BPA]. In September 2005 MZM was renamed Athena Innovative Solutions after a purchase by Veritas Capital. Athena has continued where MZM left off by collecting over $7 million in 2006 under GS-10F-0392R and GS-35F-0486M. The gravy train continues.

Surprisingly, fully 100 percent of Athena’s inherited (from MZM) contracts and 78 percent of MZM’s contracts were full and open bids, but only had one bidder - MZM. Given the size of these contracts, these statistics should raise eyebrows.

The question must be asked - how does a small business with no revenue secure a BPA worth tens of millions of dollars (GS-35F-0486M) as the prime contractor in a full and open (not a small-business set-aside) bidding process? The question must be asked - what role did the White House play in securing this contract given that the White House was MZM’s first customer?

The question must be asked - how does a small business which has only one prior past performance in buying furniture secure a massive DOD contract worth up to $250 million dollars to do classified work without any prior DOD related experience? The question must be asked - how did the White House grant a series of unprecedented contracts in 2004 for "intelligence services" to the very same company that the White House previously hired to buy furniture? The question must be asked - since the DCA20002A5016 contract has been shown to involve bribery, were there any improprieties involved in the granting of task orders by the White House to MZM under this BPA?

The question must be asked - why would the GSA grant a multi-million dollar contract (GS-10F-0392R) to MZM within a month of it becoming public that the company was involved in bribery involving government contracts?

Finally, the question must be asked whether Carol Lam was asking these very questions? In light of the email from Kyle Sampson cited above, it appears quite likely that Carol Lam’s investigation of the Duke Cunningham scandal was probably venturing into sensitive areas - thus making Carol Lam a "real problem".

That "real problem" was solved on December 7, 2006 when Carol Lam was fired.

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