HUD Contracts for Bush Supporters Only?:
I don't know anything about HUD or government contracts, but I thought this story sounded troubling. Can any one with more background in this area than I have shed some light on it? Hat tip: Raw Story.
Eric Muller (www):
I have some background in this area, and can shed some light.

Happens all the time.

You got a problem?
5.9.2006 12:56pm
Eric Muller (www):
Damn. That was supposed to be a joke; I tried to get it to post with the name "William March Tweed." But my computer overrode it with my registered name.

Technology kills another mediocre joke.
5.9.2006 12:57pm
AppSocRes (mail):
Actually it does happen all the time and always has. Anyone who's done contract consulting for the government is familiar with the term "wired". It's just not good form to be so honest about it
5.9.2006 1:16pm
Chris S (www):
I think that the story makes a bigger deal about it than is necessary. It takes a single anecdotal story about someone that shot himself in the foot and tries to make a broad claim that you have to support Bush in order to get contracts.

It's possible that the official made a bad decision, but in similar circumstances very few people are going to award a contract to someone that says they don't like your boss.
5.9.2006 1:35pm
Matija M. Gotovac (mail) (www):
The facts of the article are slim so we don't know whether an award was actually made or under what authority. However, if an award was made and a contract signed and then the contract was terminated based on the political beliefs of the contractor it would certainly be invalid. The political beliefs of the contractor are not a legitimate cause for termination. The government tries to get away with a lot using the termination for convenience, but here the procurement requirement remains so a termination for convenience would also probably be found invalid. Could a contractor successfully argue bad faith with these facts? Maybe.

If this was still in the early procurement stages the Competition in Contracting Act would certainly prohibit the rejection of proposals or contractors based on irrelevant factors such as political beliefs. Looks like the secretary set himself up for a nice bid protest.

I have no doubt this may happen often. However, the government is usually smart enough to not talk about it publicly. Also, most contractors are familiar with the bid protest system and if a government award looks irrational they will use it. It is still illegal and the secretary seems to have handed an easy win to a law firm somewhere.

ANyway, that's my take on it.
5.9.2006 1:39pm
I worked in government for a number of years, for both Democratic and Republican administrations. Obviously Jackson is speaking out of school, but, as a practical matter, no one who badmouths the elected executive is going to get any government contract. What person could be so stupid as to believe otherwise?
5.9.2006 1:54pm
Proud to be a liberal :
I had thought that it was obvious that the Bush administration awarded friends with government contracts; just look at the funds awarded to Halliburton &other Bush contributors. The corollary of giving contracts to Bush supporters is that those who do not support Bush do not get contracts.

In addition to the constitutional problems raised by denying a contract based on the exercise of First Amendment rights, the practice of awarding contracts based on political support does not promote merit. Someone who gets work because of a "political in" does not feel compelled to do a good job for continuing work -- all that is needed is continuing donations and other political support.

And perhaps the reliance on cronies and other political supports is one reason for incompetence by this administration.
5.9.2006 1:57pm
You should see what happens in small towns and counties. Everyone knows but there is nothing one wants to do about it. YOu could be really hurt as they know where you live. Get the local yokel politicians mad and the police might just get you sometime. As a matter of fact it is usually just a matter of time.
5.9.2006 1:59pm
davidbernstein (mail):
I've been under the impression for some time that HUD exists primarily to reward political allies of the current administration with contracts. In fact, I argued in my Contracts II class that potential HUD tenants couldn't file a third-party beneficiary action against HUD on a broken contract, because the developers, not the tenants, were the true intended beneficiaries of the contract in question.
5.9.2006 2:13pm
Josh_Jasper (mail):
THIS is disturbing you?! Jebus Christ, man, have you been following the whole DHS/CIA/Former Rep Cunningham/Abramoff mess?

This is nothing.

Worst. President. Ever.
5.9.2006 2:15pm
Ex-Fed (mail) (www):
Well, the HUD secretary is just trying to advance the minority outreach program.

In this case, the minority targeted is Bush supporters.
5.9.2006 2:20pm
A reader adds the following:

Under Rothe Dev. Corp. v. United States DOD, 262 F.3d 1306 (Fed Cir. 2001), the awarding of a contract is a "political act" and is subject to Constitutional protections against adverse discriminatory state action (in racial setting). See also Smith v. City of Chicago, 2002 U.S. Dist. LEXIS 14118 (N. D. Ill. 2002); Sims v. Mulcahy, 902 F.2d 524 (7th Cir. 1990).

Jackson's actions are likely unconstitutional under the First Amendment. They're obviously grounds for impeachment. They probably are not criminal in their own right, however.
5.9.2006 2:36pm
davidbernstein (mail):
P.S. that was my Contracts II class as a student in 1991, I don't teach Contracts.
5.9.2006 2:52pm
TC (mail):

I had thought that it was obvious that the Bush administration awarded friends with government contracts; just look at the funds awarded to Halliburton &other Bush contributors.

Of course, because we all know that the Bush White House renewed the Balkans LOGCAP contract with Halliburton in 1997 and 1999.

Oh, wait...
5.9.2006 2:53pm
DF (mail):
Does anyone - Dave Kopel maybe - remember Andrew Cuomo's dealings with Smith &Wesson?
5.9.2006 2:56pm
K Bennight (mail):
"just look at the funds awarded to Halliburton &other Bush contributors"

Ah yes. If only Bush had contracted with Ben &Jerry's Ice Cream to rebuild Iraq.
5.9.2006 2:56pm
Davebo (mail):

Ah yes. If only Bush had contracted with Ben &Jerry's Ice Cream to rebuild Iraq.

Don't be silly. No one from Ben and Jerry's has ever worked for the American Enterprise Institute. And really hasn't Iraq really just been a jobs program for children of neocons?

If you think a contractor telling a government manager that he doesn't support the president is stupid what do you think about a government manager admitting he cancelled a contract because the vendor didn't support the president??
5.9.2006 3:10pm
I know, I know, it happens all the time, but I'd be very happy to take this contractor's case on contingency.
5.9.2006 3:15pm
Commenterlein (mail):
The most troublesome aspect isn't that government contracts are to some extent allocated based on political leanings, but that we have now reached the point were the HUD secretary is openly bragging about it. Welcome to Bush's Banana Republic.
5.9.2006 3:47pm
David Hecht (mail):
As others have said, it's very difficult to establish the facts of the situation, but it's *possible* that the HUD guy's reference to the contractor's being "...on the GSA list" simply means that he was a qualified supplier among many others, and that the contract yanking occurred prior to the actual award of an order.

Here's the scenario: there are many things for which GSA negotiates price schedules on a government-wide basis (office supplies, that sort of thing). HUD procurement gets a request to go out and buy a million BIC Bananas. They scrutinize the GSA Schedule, and decide to give the order to Big Banana Inc. The president of the company (Mr. Big Banana himself!) finds out he's about to get this big order, decides to come in and give the HUD guy a piece of his mind, and the rest is history...
5.9.2006 3:49pm
Houston Lawyer:
I seem to recall that Ron Brown, Clinton's Commerce Secretary, was regularly accused of taking only Democrat donors on "business development" junkets outside of the country. This administration has been relatively free of this type of petty corruption.
5.9.2006 3:53pm
Thorley Winston (mail) (www):
Okay you've convinced me, shut down HUD and get the federal government out of the housing business.
Do I hear a second?
5.9.2006 4:00pm
Justin (mail):
This administration has been relatively free of this type of petty corruption.

::giggle:: I hate schaudenfraude, but watching people torture themselves in self-justify supporting this administration has gotten to a point of sheer amusement.

Unless you mean the Bush administration has focused on much bigger forms of corruption - something tells that's not the case.

But anyway, they're still good at this stuff too. Hali-wha?
5.9.2006 4:07pm
speedwell (mail):
Well, that's obviously no way to get the contractor to like the administration, now is it?
5.9.2006 4:15pm
I seem to recall that Ron Brown, Clinton's Commerce Secretary, was regularly accused of taking only Democrat donors on "business development" junkets outside of the country.


Remember, pointing out that others, such as Bill Clinton, have done this on a much bigger scale and much more discreetly is "changing the subject".
5.9.2006 4:18pm
hey (mail):
This was an advertising contract, so the secretary likely has more leeway in awarding a contract than in something tangible. It wouldn't be all that difficult to say that the owner's meeting with the secretary called in to question his ability to execute the contract as appropriate and to produce the advertising as needed. It's one thing to be a member of an opposing party and do political work for an opposing party, but to go in to a meeting with a Cabinet member and pull this kind of thing... That'll get your contract pulled in any private sector situation also, since you've proved you're an idiot.

For anyone, especially in advertising, to do this before the contract was signed (hell, any point before all possible work had been completed and checks cashed) is simply a demonstration of functional stupidity. That the Secretary TOLD this story is ALSO a demonstration of functional stupidity.

But if the Dems on the board think that this justifies shutting down any department where this happens... well I'm only too happy to echo their calls. Goodbye federal spending!
5.9.2006 4:31pm
5.9.2006 5:05pm
markm (mail):
It happens all the time - but this time you can prove it.
5.9.2006 7:53pm
David C. (www):
1. Believing a newspaper has the complete story is usually not a good bet.
2. Grantees of HUD are required to sign a statement that they will not be using any of the funds received for lobbying purposes. If contractors have the same requirement, he may have fallen afowl of that rule.

An observation - 75 posts and no one brings up 31 USC 1352? PL 104-65? 24 CFR Part 87? The Byrd Amendment?

I thought this was a law blog? Your commenters have let you down.
5.9.2006 8:56pm
Justin (mail):
31 USC 1352 is irrelevant to this issue.

PL 104-65, which is embodied in 31 USC 1352, is equally irrelevant. So is 24 CFR 87.

The question here is whether the government can discriminate between contractors based on political ideology, not whether contractors have violated acts which regulate lobbyists and lobbyers.

And your "comment" isn't #76.
5.9.2006 9:49pm
nick (mail) (www):
Political greed in the distribution of public money will always be news as long there are people who promote such direct government interference in the housing market. Such people assume or implicitly believe that this kind of thing doesn't happen very often. So for example you see many Democrats claim that this (or the Katrina response, or the Medicare drug debacle, or Iraq, and so on) is a problem unique to the Bush Administration. If really Good People, namely Democrats, were in charge, this sort of thing just would not happen. They've conventiently forgotten about welfare fraud, Vietnam, inflation, pork barrel spending, and a variety of other problems that plagued previously administrations, Democrat and Republican.

In the typical political debate there is an implied belief that our government is peopled by benevolent "public servants" doing good deeds. These people, the implicit belief goes, are just better people than us greedy people working for money in the private sector. It's not just big-government Democrats who buy into this whopper, but also big-government Republicans: namely Bush and those who supported the Medicare drug program, "No Child Left Behind", ad nauseum.

The honesty here, while "stupid" for his political career, as much among big-government Republicans as among big-government Democrats, is eminently refreshing
5.12.2006 8:57pm