May 2001 - VOLUME 22 - NUMBER 5
T H E B U S H Y E A R S B E G I N
Defending Contractor Irresponsibility
By Robert Weissman
The federal governments short dalliance with a corporate responsibility
screen for contractors appears to have ended.
In April, the Bush administration issued notice that it intended to rescind
the contractor responsibility rule issued at the end of the Clinton administration.
The Clinton rule would have authorized government procurement officers
to deny contracts to corporate bidders who had a demonstrated record of
irresponsibility. The rule specified that procurement officers should
look especially for repeat violations of laws and regulations related
to taxation, environmental and consumer protection, antitrust and labor
and employment laws [See Controlling Corporate Scofflaws or Blacklisting?
Multinational Monitor, July/August 1999].
The Bush administrations announcement of its intention to roll
back the rule, published in the April 3, 2001 Federal Register, contends
that the rules do not provide contracting officers with sufficient
guidelines to prevent arbitrary or otherwise abusive implementation,
and that the rule is not justified from a cost benefit perspective.
The controversial rule was first formally proposed by Vice President
Al Gore in 1997, as he was jockeying with Representative Richard Gephardt,
D-Missouri, for support from organized labor for the 2000 Democratic presidential
The Clinton administration failed to move on the proposal until 1999.
A concerted business campaign stalled its willingness to implement the
rule, which was revised after an initial notice and comment period.
The Bush administration suspended implementation January 20, and then
extended the suspension on April 3.
In its April 3 announcement of its intent to rescind the rule altogether,
the Bush administration said that the fact that the rule had been in force
for such a short period meant that there has not been time for the
public to be in a position of reliance on the rules existence.
Public interest proponents of the rule contend that there is no serious
substantive argument against the rule. A more careful examination
of a prospective contractors record and an up-front determination
on compliance with the law would help ensure that taxpayer money is spent
responsibly, says Gary Bass, executive director of OMB Watch, as
well as chairman of Citizens for Sensible Safeguards, a broad-based coalition
of hundreds of public interest organizations. It seems clear, however,
that the administration is less concerned about its obligations to taxpayers
who the president claims to care so much about and more
concerned about the powerful corporate interests that made repeal of this
rule a top priority. The corporate beneficiaries of the proposed
roll back were overjoyed with the Bush announcement. We have fought
this political payback to the unions every step of the way, says
Randel Johnson, U.S. Chamber of Commerce vice president for labor policy.
This rule is completely unworkable.
The Chamber argued that, under the rule, government agents wold
have had virtually unlimited, arbitrary power to decide who could compete
for the governments business.
The result, business groups alleged, was likely to be a new form of blacklisting.
These rules stand for the simple, common sense proposition that
the government should look at a company's track record of complying with
the law before giving that company a federal contract worth millions of
dollars, says AFL-CIO Executive Vice President Linda Chavez-Thompson.
Many existing contractors do in fact have records of serious and/or repeated lawbreaking. A Multinational Monitor investigation found that nine of the top 100 corporate criminals of the 1990s were among the 200 largest federal government contractors in 1998, and that six of the largest 50 government contactors had been cited for repeat workplace safety violations.