THE ART OF FURTHER STUDY
Easterbrook, Gregg
THE ART OF FURTHER STUDY Life in the consulting cult by Gregg Easterbrook "We are troubled by reports of the developing of weaponry," he said melodiously, "exceeding in quality and size the...
...Hickman and Cummings made a natural pair, having worked together in the past...
...Inner City Fund got its wish...
...Wartime emergency production quickly outstripped the capacity of naval facilities, so the Navy, like other government agencies, contracted its work out to private plants and shipyards...
...Yet NHTSA officials said in private that they agreed with the study'S conclusion...
...The continuing preparation for war demonstrates," the Pope continued, his every tone resonating with sober primacy, "by the production of ever-more numerous, powerful, and sophisticated weapons in various countries, that there is a desire to be ready for war...
...When they work for government it does not...
...We didn't want any nuts and bolts report writing," Caputo recalls...
...Fleeing to a consulting firm that prides itself on a genteel work environment could be a step for health as well as wealth...
...Yes, Mitre said, our model— called SPURR—could predict that...
...That it could reach no conclusions until 1982, long after the funds were inalterably committed...
...We wanted to advise in high-level policymaking, a level few consultants reach, and we were willing to work cheap to do that...
...It claims, as do many consulting companies, that it keeps no copies of finished reports...
...Energy and Environmental Analysis, founded in the early 1970s, was put together by former Pentagon analysts who "realized they could make a lot more money as consultants," says a former EEA consultant...
...Idealists prefer to rob the rich and consulting jobs were the perfect way to hang around Washington and do just that...
...It was Virginia Rep...
...It was in this guise that consultants first came to Washington...
...It was desirable to be associated with the prestige of such ventures, which led to what former McKinsey Co...
...Won't Go Home Again Think you could make interesting conversation about program analysis over cognac and coffee...
...McNamara proteges Donald Ogilvie, who later became a dean of Yale's management school, and Bruce Caputo, who later was a Republican congressman, formed a consulting company called Inner City Fund...
...It compiled no information on the Department of Defense-which, with an estimated 50,000 consultants costing $250 million yearly, is the cult's largest sponsor -and shows the Department of Housing and Urban Development as having "zero," when it is known to have hundreds...
...They're giving out $24 million for studies...
...You get to recognize the language of the proposals," says a DOE contract officer, "because it goes right into the contract description...
...Can't anybody give a straight-much less infallible-answer anymore...
...after all, they would have to give up lifetime security in exchange for hustling work...
...The civil servant gets to promise it...
...Civil servants are hired for life...
...He succeeded in part by using another technique emphasized during the war-contracting out...
...But during the 1 960s, increasing numbers of consultants came from the government itself...
...Secretaries of the agencies they serve make $66,000...
...We are troubled by reports of developing weaponry...
...Case Western was moved to compromise...
...Hickman is a former high EPA official...
...But many of the present goals make the meChanical, do-able goals like efficient war prOduction seem simple by comparison...
...You Have to Get In...
...Hickman and Cummings like their new situation...
...The same technology tide that swept in computers was complicating other fields, like defense...
...It's effortless...
...One of life's mysterious constants, like the speed of light...
...Word filtered back that the White House was not amused...
...In America, "consultant" was first used to describe the management experts who prowled around factories, stopwatches raised, performing the famous "time and motion" studies...
...records combed over with righteous fury by public interest groups...
...But Johnson told the Office of Management and Budget to insist that everything be done in PPBS jargon...
...What he does is the client's property, to do with as the client chooses...
...What next...
...My career in EPA was finished...
...These tanks were staffed by scientists doing "hard" research such as aircraft design (although many later added advice-giving consultant branches...
...The number should double or more in this year's census, unless the consultants list themselves as "contractors...
...The boss gets to change jobs and forget the whole issue...
...H. Richard Chew, a Virginia attorney, got a sole-source DOE contract to write a handbook on solar law...
...ICF founder Caputo, who has left Congress to return to consulting, explains: "When I was a congressman, I would have been very surprised if someone on my staff had gotten a straight answer from a consultant...
...Money for the lunches and conferences comes out of the fees paid to consulting companies...
...Why doesn't he explain what they are...
...Worse, to work for industry was to shift from Samaritan to mugger...
...Civil servants at least are required to pretend to candor...
...Now, civil servants in agency budget offices had no more idea what PPBS was than how to whistle in FORTRAN...
...I don't have to spend all my time pleading with civil servants, trying to get things done," Hickman said...
...There were no exceptional expenses, just Ballanc;:e, his secretary, arid overhead...
...That's for the client to decide...
...Consultants claim a privileged client relationship...
...Since that suite costs $200 a day, there would have been spare change left over for essentials like Chateaubriand sandwiches...
...As an officer of the Public Health Service, he had to register a full 20 years' service to qualify...
...So the objective experts, when asked to objectively and independently come to a predetermined conclusion, began to say, "I have the most extraordinary coincidence to report . . . ." Here Cons the Sun After Carter took office, for instance, the Department of Energy commissioned some studies of solar power...
...OMB is the most recent flop...
...He was also at an impasse...
...Schools would sell a small percentage of a professor's time t6 several different agencies, but sell all of his overhead again and again...
...As soon as the feds started funneling out the money," Cummings says, "we knew it would be time to get in...
...RAM is usually paid in federal "rollover" funds-money sent to the states under RCRA, money which must be returned if unspent...
...Later, an EEA computer jock—disappointed at the loss of a contract—sat down for a workout with the SPURR math...
...It came to almost exactly the same conclusions about Chrysler as did Harbridge...
...The study is being conducted by the National Institute for Education, a quasi-independent agency staffed, by law, primarily with consultants...
...The advicegiving consultants liked to do "studies" which were little more than digests of technical literature, framed in unassailable generalities-similar in form and content to a college term paper...
...RAM's partners are H. Lanier Hickman, Russell Cummings, and Clay Ervine...
...The boss gets to scream for action...
...Our dynamic environment demands shortcuts," he says...
...The first GS-14 who realized this relationship must have heard a choir of heavenly voices bursting forth into his ears...
...Even this universally acknowledged fact is couched in legalistic equivocation...
...Frustrated by the lack of immediate success, they begin to tell tliemselves: If 1 knew what to do, Fd dQ it...
...Is "government by contract" constitutionally valid...
...No amount of explanation of PPBS could express how it (or any of its successors, from "management by objective" under Nixon, to "zero-based-budgeting" under Carter), in any way differed from the existing budget process...
...What are "general and administrative" expenses if not overhead...
...If you are a Washington consultant, you work for the government and you do what you have to do to keep your client happy...
...But below that, Pacific tacked on other costs that would normally be ascribed to overhead...
...Buying lunch or a hotel room is a legitimate business expense, and is deducted from the consulting firm's taxes...
...It will pay consultants an eight'~percent "profit" on their salaries...
...Is it that the Pope drones on for more than an hour, leaving his audience numb at the extremities...
...They just came right out and said it," explains a Claybrook deputy, "it" being that Chrysler was about to go belly-up...
...EPA, for instance, ordered a $150,000 study of the possible effects of a controversial set of proposed regulations...
...Most people are dimly aware that consultants, who keep their numbers obscure and their purpose uncertain in the manner of a cult, are increasing in importance...
...Traditionally, pOlitical appointees finishing a tour of government work go back home...
...Above the salaries and overhead they bill, companies usually receive "professional fee!!," loosely thought of as the profit...
...A Quiet Lunch For government officials, one attraction of the consulting cult transcends politics or wartime crisis, even race or origin...
...Have Stopwatch, Will Travel Though today's consultant dispenses numbing generalities, and would rather be bitten by a snake than give a definite answer about anything, he is descended from a profession once known for its specificity...
...NIE's second announcement...
...Everything will depend on whether differences and contrasts in the sphere of the possession of goods will be symmetrically reduced," he explained patiently, "through truly effective means...
...But the contractor delayed the start of his work until after the public comment period had closed...
...That's roughly $11,000 a month, or $550 a day for a man and a secretary...
...Oddly enough, the day after most consulting companies sign their competitive-bid contracts, they discover that the task is far more complex and challenging than they realized the day before...
...the plan itself hasn't been started yet...
...The $39,627 for overhead is 75 percent of $52,836 in salaries and fringes...
...Their cost rose to $18.7 million...
...This association just won a $50,000 grant from EPA...
...This would be fine with Harris, who is sponsoring a bill to give any agency cutting back on its use of consultants the "incentive reward" of a raised civil-service ceiling...
...Two years ago, for example, NHTSA ordered Harbridge House, a consulting firm, to study how auto companies react to regulation...
...We do not grant interviews to anyone on any subject," a partner of McKinsey & Co...
...It is October 1979, and the delegates to the United Nations listen closely to this counsel...
...Individuals on "direct hire" to an agency can bill a maximum of $190 a day for their time...
...Consultants can pick up the tab...
...Contractor" implies they produce something concrete...
...His contract justification explained that he and only he could do the work because Chew had "experience unlikely to be found elsewhere...
...Their total value, when bid, was $9.8 million...
...After explaining how their high salaries have to cover'fringe benefits and overhead, consultants go right ahead and bill for those items anyway...
...When consultants do proprietary work for private-industry clients, a privileged status makes sense...
...It's common for consultants, who solicit, work by writing proposals for studies, to practically hire themselves by proposing a purchase-order contract to a friendly contract officer...
...Hickman in particular was ready for a change...
...The New York state plan was supposed· to be finished by the end of RAM's sixmonth, $38,000 contract...
...Sometimes We have to admit to the state that even we"-the people who wrote the regulations-" can't quite figure out what the regulations mean," Cummings said...
...New York State has perhaps the, most engaging notion...
...Maybe you get lucky, and he comes up with the answer...
...if you want to see the report, BoozAllen says, get it from the agency...
...They are welleducated, informed, and resourceful...
...Civil servants claim a right of silence less frequently these days, in the wake of court decisions eroding the "executive privilege" excuse once common in Washington...
...Would they just do whatever you wanted...
...This excuse is elevated to the sublime when the study lasts longer than the boss who demanded it...
...Consultant Ned Jaros of Cary & Jaros calls this "weighable paper...
...Consultants came to Washington to tell government officials things they could not pretend to know, about running factories and computers...
...It's time-consuming and taxing, and not ·always reliable-the wrong firm might get the job...
...Then government consulting may be the job for you...
...The contract contained, of course, the standard boilerplate provision barring the consultant from working on government property during his contract-which is the reason overhead is paid...
...Peter...
...The 4,000 Washington residents who described themselves as "consultant" in the 1960 census nad risen to 23,000 by the time of the 1973 special census...
...You had to stop and wonder-would these well-educated and sophisticated consultants, whose great assets were exacting skill and objectivity, stoop to doing your mumbling for you...
...While at EPA, Hickman was in charge of writing documents that explained RCRA to states, and providing states with "technical assistance...
...this is consulting talk, all right...
...A great crescendo precedes points that are crashingly obvious...
...Sprucing them up with false research elevated their prestige...
...Recently the Navy took bids on a $l-million contract to design its Senior Executive Service...
...It's the issue that's really deserving of further study...
...People who know how to work a pocket calculator become "experienced program analysts...
...then said 34,000...
...Like the number of disadvantaged children who bring bagged lunches to school when it's snowing-"new information...
...What means...
...next year in our small field alone...
...The ambassadors nod attentively...
...As long as you don't look too closely, the charts and sine curves seem to be the essence of scholarly sobriety...
...Herb Harris II, whose district is a Washington bedroom community where civil servants do most of the snoring, who requested the GAO report...
...There was $39,627 listed as "overhead," $2,535 as "other costs," and $8,860 charged to '~general and administrative...
...Winning the first contract gives you access to the ones that follow, like trading up houses...
...Chew, for instance, decided to bill his time out at $500 a day.' "It was a compromise," he explains, "because I charge my legal clients more...
...but they never got down to the real scandal...
...We live off the stuff EPA gives out," notes Hickman...
...Universities are particularly adept at this...
...What mysterious means will be truly effective...
...If my client doesn't like it, he can fire me...
...He found that even starting with extremely unfavorable assumptions—such as solar power costing ten times more than any other kind to produce—SPURR would reach the 20-percent prediction...
...This is the kind of sequence they make into a ride at Disneyland...
...There was a total of $7,270 in "professional fees" paid to Pacific itself...
...OMB first said there were 2,000...
...But progress didn't stop there...
...Officials like Frank Knox, then secretary of the Navy, called in consultants like Edwin Booz, a prominent private-industry adviser...
...It merely determines who gets the work...
...Some are so far distant, they confound even the dedicated: "End poverty...
...It's something in the words themselves, and it sounds familiar...
...It's easier for a bureaucrat to hire a sole-source consultant than to buy a box of pencils," explains Jerry Sturges, a former Senate investigator...
...Not to anybody, but especially not to a reporter...
...failing that, will pretend they can figure it out...
...But unlike Williams, Washington consultants do not have a wide range of clients...
...It pre-qualified five prominent firms, among them Coopers & Lybrand, Booz-Allen, and Cresap McCormick & Piaget...
...It cuts him loose from personal standards, setting him adrift in a calm and peaceful moral void, similar to the "advocacy" void favored by lawyers...
...But it isn't...
...We don't plan to conclude anything terribly specific in 1982 because of the program's abstract nature," the contract officer said...
...Now talk about money...
...Otherwise, he keeps you from sloughing into despondency over your own inaction...
...They can treat their sponsoring contract officer to a pleasant lunch and pick up the tab...
...His Holiness, John Paul II, is reporting to them on the state of the world...
...Their cubic office buildings, plated with reflective glass and moist from atriuIl...
...Then, in March, the front pages of Washington newspapers were covered with stories about a General Accounting Office study that found a pattern of "pervasive abuses" throughout the consulting industry...
...Consultants, however, are under no such strictures...
...Carl Black, a retired Marine colonel and defense consultant, explained that this is a straightforward business proposition...
...But this consultant's work, mostly 'graphs and integrals with little narrative, is so dense the reader needs a slide rule and protractor to plow through it...
...Yet inside, the words "New York" appear only eight times, and no New York cities, locations, or particular environmental conditions are mentioned...
...All that's necessary is for the agency to recognize in a consultant some unique combination of skills and experience...
...Yet something is dreadfully wrong here...
...Chew's experience...
...Good weighable paper is heavy (as in, "I know it was a good report, it was big and thick," which one HEW official said of a study), tells you what you want to hear, and is so densely written that no one can ever claim other- 18 wise...
...Since everyone is in some respect "unique," the potential is unlimited...
...In an age of hype and glorification, this self-restraining modesty may seem touching...
...Saints defend us...
...McNamara and his Pentagon Whiz Kids convinced the world that you needed three post-graduate degrees to determine whether an artillery shell had exploded...
...This is hardly an environment designed to foster a taut interplay of checks and balances, since the agencies are the ones paying to be told what they want to hear in the first place...
...it turns out, is in habeas corpus law...
...But I could keep on consulting forever...
...Ervine is a former Maryland public works director...
...NIE's first announcement...
...If they are lazy or incompetent, they cannot be fired...
...No, more earthly...
...Federal regulations designed to provide "fair" evaluations demand scrupulous examination of even spurious bids...
...While consultants like Booz-himself a contract employeerefined these contracting procedures, they also established a beachhead for consultants that was later used in staging all-out invasions...
...The contract was a sole-source award based on Ballance's "key personnel" qualifications...
...This is one of the reasons government officials do not feel inspired to hold consulting fees down...
...The fledgling consultant, meanwhile, has enough work to tide him over till he lands a bigjob...
...During World War II, government had an uncharacteristically profound interest in efficiency...
...Pencils have physical properties that can be compared...
...But Who...
...solutions" so vague as not to offend the comatose...
...lobbies, dot the Beltway exiis like so many Howard 10hnsons...
...Consultants have lately taken to calling themselves contractors because they don't like to be called consultants...
...They succeeded...
...The appearance of furious action, no loss of face, and none of that unpleasant business of actually doing anything...
...It never does...
...So they constantly seek out those whose qualifications suggest they might know what to do...
...John Clement, a NASA analyst who helped found an environmental consulting firm in the late 1960s, was a similar case...
...The combined contracts totaled $52,836 in salaries and fringe benefits for the consultant and his secretary...
...I'd been passed over twice for promotion to the top of my division...
...Is it fairly priced...
...Others are let on a "sole-source" basis-in which the desired firm is found to be uniquely qualified, all competition is waived, and money can be awarded without even so much as an announcement that a contract has been signed...
...flavor...
...He's saying the issue needs further study...
...calls for further study...
...Whoever could set up shop first would get the action...
...Consultants are about as interested in meeting a reporter as they are in having a picnic with God zilla...
...Did he just hear about the V -2...
...As long as he was cloaked in themystique of the consulting cult-advanced degrees in esoteric disciplines, a senior position with an ambiguously named but clearly successful firm-OMB's formalities were satisfied...
...Cummings has been a prominent EPA consultant for several years...
...Unfortunately, its advice was worth the price...
...So he just tosses the study on a shelf, and orders a new set of reports he will never see the results of...
...The White House planned to announce a sunny outlook for the politically harmless "solar option...
...If 1 want to go home at I o'clock, 1 can...
...Is it possible that, after all their flaws, they still perform some useful service...
...The report was not delivered until the regulations were already in effect...
...And if 1 decide 1 don't like him, 1 can say 'Sayonara.' " Hickman and Cummings are, by any...
...The chairman of General Motors can call up Carter and say, 'Get these SOB regulators off my back.' The President then demands an explanation for your actions...
...The Office of Personnel Manageme~ t recently compla!ned to Case Western Reserve University that, as part of a $126,000 contract to provide five years of pa~t-time study of the merit-pay system, the school was charging too much for overhead...
...U nder-$IO,OOO contracts are useful to put a foot in the door, or tide you over, or to build a resume...
...When Carter took office, he sent OMB a handwritten order that it produce an accounting of consultants...
...There's just the wispy reference to using "truly effective means...
...Say his boss calls up and wants to know why in blazes nothing is happening...
...every economic tremor underneath the bleak streets of Akron and Buffalo jostles Congress into creating more commissions, more agencies, more studies...
...For the consultant himself, claiming privilege is among the most agreeable fringe benefits of the job...
...Since most outraged calls for action come from the agency's assistant secretaries, and assistant secretaries turn over every 18 months or so, all the mid-level bureaucrat whose peace of mind is threatened has to do is plot a study that can't possibly be finished within the tenure of its sponsor...
...Part of Hickman~s time goes into being director of the Governmental Refuse Collection and Disposal Association, a trade association of public works directors and engineers...
...In fact, they discovered they could expand the government without ever changing its official "size," which is reckoned as the number of civil servants...
...It dropped its overhead bill from 62 percent of salaries to 59 percent, and its fringe benefit bill from 21 percent to 19 percent...
...Many of the volleys of angst, it turned out, were being launched by the defenders of civil servants, who know that consultants are being hired to do work that would otherwise be performed by regular government employees...
...Knox told Booz to streamline the Navy's logistics and management...
...The contract was modified once, then modified again, and finally expired on October 12, 1979...
...Consulting expenses under $10,000 can be paid with government· . purchase orders...
...Computers were mystery boxes that spewed out numbers and factors without any hint of origin, sniffing rabbits pulled from an empty hat...
...You're only a GS- 14...
...A Civil Attitude At least the agencies that consultants work for have press offices, so it's tempting to propose replacing consultants with civil servants...
...To prepare a really first-rate proposal for a contract might cost $50,000," Black said...
...it failed to send the model itself...
...said flatly...
...So government-funded, contractor-operated, quasi-independent think tanks like RAND, Mitre, and Oak Ridge National Laboratory were created...
...Filet of Sole Competitive bidding has its attractions, but it's much more congenial to do business under sole-source exemptions...
...But the demand for consultants began to languish after the war, as government reverted to its natural state of indifference to efficiency...
...But there's more to it...
...All they needed was to lower in someone to mumble the PPBS gibberish, satisfy the pretenses, and keep the system moving...
...Government officials, for all their power to spend or waste millions, simply do not have expense accounts...
...which consisted of sitting around a conference table asking "How much money will we need next year...
...just studies...
...The fun of having consultants lies in announcing their vital work and then misplacing results, not in struggling with legal details...
...It is quite conceivable they will someday, as Cummings claims, save their clients time and money by "knowing who to call...
...Ed Hearle, a senior vice president of Booz-Allen & Hamilton-the $lOO-million- a-year consulting firm, with seven Washington offices, founded by Edwin Booz, explains: "Everybody tries to claim his study is really 'research' and full of 'new information.' Government is fascinated with getting 'new information.' But it's usually just old numbers that have been massaged beyond recognition, or new numbers so trivial no one ever cared to get them before...
...Industry was tainted, a robber of the poor...
...Now, who could be opposed to further study...
...THE ART OF FURTHER STUDY Life in the consulting cult by Gregg Easterbrook "We are troubled by reports of the developing of weaponry," he said melodiously, "exceeding in quality and size the tools of destruction and war known before...
...Figure you could wrap a dynamite Lake Tahoe conference around Our Priorities for the Eighties...
...So they start negotiating for more money...
...These involve almost no review and can often be authorized by a single civil servant...
...A few months ago, PRC Corp., a $280-million-a-year consulting firm, admitted to billing the Corps of Engineers for studies it had already done under a NASA contract...
...then said it really meant 6,000...
...The Clone of Silence If you were an idealist making your living in this pure fashion, you might not want to talk about it much...
...DeLae, Evayde, & Stallum The next great discovery perhaps surpasses the Paper Weight Principle in significance...
...They complained about consultant accountability and raised convoluted constitutional questions about the legalities of farming out government work...
...It helps to have a pile of studies to refer to...
...He doubtless felt strangely giddy, as if elevated on a billowy cloud, while envisioning himself being carried, saint~like, to that final place of rest where virtuous civil servants go-a corner office...
...It is a mistake, however, to assume that this forthcoming attitude is reserved for reporters...
...Mike Tashjian, a special assistant in the DOE secretary's office, defends the laissezfaire granting of sole-source exemptions...
...The "seminar officer" being hired under the grant is Clay Ervine...
...Inner City Fund suddenly remembered that what it really cared about all along was energy...
...Consulting overhead used to be one of the great hidden subsidies to higher education...
...Management by Subjective The urge to conduct government business in some kind of techno-babble, building since the war, found a champion in Defense Secretary Robert McNamara, patron saint of the consulting cult...
...Officials continue to need to know things they cannot pretend to understand...
...In a single year, the contracts had been "modified" a total of 45 times...
...This is because the payment to a company is a fee, not a salary,'and fees can be,as unique as people...
...He persuaded Lyndon Johnson that something called Planning-Programming-Budgeting Systems would make Washington a lean machine of cheetah-like efficiency...
...And then there's that old free enterprise spirit...
...I was sick of the bureaucracy, sitting in meetings and strokil).g my prima donna underlings," he says...
...I do the same things now, only I get paid a lot more...
...RAM is signing contracts with state governments to do planning work under a comprehensive new environmental law, the Resource Conservation and Recovery Act...
...The official who orders a study is seldom the one who gets the results," says Booz-Allen's Hearle...
...consultant and Department of Energy assistant secretary George McIsaac calls "the explosion of false research...
...There were heated congressional hearings and expressions of outrage...
...The study was supposed to enlighten the public about the regulations before they became final, according to GAO's Jerome Stolarow...
...Two weeks after he hit 20 years, he quit...
...Government officials are given large sums of money to pursue such intractabl~ goals...
...He pegs an EEA partner's earnings at $100,000 annually...
...Around Washington, consuftants are called Beltway Bandits, because many of them have offices along 1-495, a circumferential highway far from the downtown clatter...
...When word of the report's language got out, I got calls from every congressman on the Hill, wondering what the hell right we had to say that Chrysler was going bankrupt," Powel explained...
...The civil servant gets to go home early...
...No one would ever believe there was only a 'sole source' of pencils...
...There came times when their careers were on the rocks, either because they had exhausted the possibilities for promotion, or because Nixon was giving them the boot...
...The other is that there really is a free lunch .. "Y ou have to understand our predicament," says Sam 'Powel, a contract manager for the National Highway Traffic Safety Administration...
...Coopers won...
...Its equally obvious potential for favoritism prompts loud calls for liberal reforms, like competitive bidding of all contracts...
...Chasing consultants around is a great way to kick up a lot of dust and create the appearance of terrific action...
...one informed observer called him "clearly the recognized authority in his field...
...they made accurate attacks on the waste and favoritism in the field...
...Some nave such bewildering ramifications, you can't even be sure if you've achieved them already: "Build enough bombs to prevent war...
...It's vital for a government official to always have a study in progress," says John Gilligan, former director of the Agency for International Development, one of the top consultant users with about $100 million spent for advice last year...
...Everybody wants the most possible information...
...If I knew what to do, Fd do it-but I don't, so I'm waiting for the study...
...was caught billing $29,000 for work it never even pretended to do...
...He explains that he just commissioned a major study...
...Priorities have changed, and maybe he's trying to cut a bold swath by downgrading everything done by his predecessor...
...Consulting companies, however, routinely bill their employees at $300 to $500 a day, plus overhead...
...When Jesse Jackson's Operation PUSH-Excel was awarded unsolicited HEW funds on personal orders from Joe Califano in 1978 (see "I Am Somebody...
...reasonable standard, weil-qualified to do the states' planning work...
...Shifting topics, the Pope declared that "it is my fervent hope that a solution to the crisis in the Middle East may draw nearer...
...They'd written much of the RCRA regulations they are now explaining to states...
...He's never heard of the study...
...qually important, no...
...People who took college political science courses can be described as "intimately acquainted with recent geopolitical trends...
...Meanwhile the civil servant who authorized the study and supervised the contract gets his automatic "step" raise...
...Then, when it comes...
...They are independent and happy after years of struggling with tedium...
...Two other great discoveries have been made...
...It burned me out," says a former assistant secretary of his two-year stint...
...They're busy with the crisis threatening the Western world this week...
...Telling you what you pay to hear has since been refined into the more sQphisticated Paper Weight Principle...
...If the environmental crisis they are supposedly solving continues unabated, while their "plans" are skating lazy circles of perpetual delay...
...First signed on December 12, 1978, it specified $59,928 for five months' work...
...You hire a consultant to try to figure out what you can't figure out...
...One, a 32-page report on provisions of the law, was "prepared for New York State," according to its cover...
...Government's delight at such wonders achieved so simply led to explosive growth in the consulting industry...
...But for anyone from the level of assistant secretary up, the change would be a blessing...
...His purpose was to provide instructions on exa(;tly how to treat the patient, not to give lectures on the general principles of medicine...
...The consultants didn't want to leave Washington, so they began to transform themselves from production efficiency experts to employment agencies, willing to supply bodies to government branches bumping up against their civilservice hiring ceilings...
...Hodding Carter, for example, has mastered it entirely...
...With bidding, a formal announcement is made in the Commerce Business Daily...
...The way the Pope and Hodding Carter talk gives you more of a clue, one that requires a bit of history to understand...
...What was the problem, then...
...It became the primary source of advice on how to set up minority-run city businesses...
...There was no one to go to for the answers...
...Civil servants may be more talkative than consultants, but they are even less accountable...
...So generally only the big contracts-for which some scrutiny is inevitable-are let by competitive bid...
...Most of the rituals of the consulting cult are being acted out in the basements of three suburban Washington homes...
...Just as clerics schooled in mystic orders surround the Pope, consultants abound in their own Vatican City-Washington D.C...
...EEA made the pessimistic prediction that solar collectors worked but were too expensive to be practical...
...The gothic sentences, stripped of their flyingbuttress clauses, crumble into a rubble of gibberish...
...in The Washington Monthly, February), there was controversy over the merit of Jackson's program...
...Now who could be opposed to finishing a study...
...A consultant is like a priyate eye, they say-he's not always working...
...It got tossed onto the weighable stack NHTSA offici~ls wave at when they lobby the Congress, as intended...
...Inventing sole-source qualifications is a native American art form, like comic books...
...The cult has an explanation for these high fees...
...By that time modifications had pushed its value to $1l1,136...
...Jesus would have spoken for five minutes, tops, and leftthe dignitaries in a cold sweat for their souls...
...Their hollow language is fast becoming the city's only means of communication...
...Harris go straight for the cosmic issues, asking, as he recently did, if we're not "abdicating the basic functions of government" by hiring outsiders...
...But to leave Washington was seen as an admission of defeat...
...Reports...
...The Middle East needs a "solution," the gap between rich and poor is "excessive...
...This subsidy is diminishing in importance only because professors, after further study, began opening their own consulting shops...
...Anybody could see that the environment would be the next big issue," he said...
...And he's got pension and health care costs he must pay himself, costs that don't show up in the calculation of a civil servant's pay...
...This technique is popular because of its obvious streamlined features...
...Can regulations written by non-civil-servants stand up in court...
...But, in general, the more idealistic appointees of the Kennedy and Johnson years didn't want to leave...
...True enough, of course: But how much time does this private-eye type consultant actually lose drumming up work...
...It seems the entire time the government was paying Pacific $255 a day for "overhead," Ballance was slttmg at a desk in the Executive Office Building-where, with some regular AID planners, he worked for the entire span of the contract...
...So far most of the reports delivered to New York bear a haunting resemblance to EPA documents...
...SPURR became an institutional feature of DOE thinking, and has been regularly funded by the government since...
...Consider the smooth, globe-like perfection of this device...
...Since few people at OMB could grasp any more than the superficials of PPBS, and OMB lacked the manpower to penetrate an agency's inner mysteries and seriously challenge its budget, the agency bureaucrats quickly realized PPBS was really no threat at all...
...At that rate$ 255 a day-Pacific could have put its consultant up in the luxury suite of the Capitol Hill Hyatt Regency...
...The contents are almost identical to materials available through the EPA publications office...
...he wonders...
...Obviously, if we can't trust consultants to do the discoursing on Our Priorities for the Eighties, we have to hire more civil servants...
...If the agency cannot locate its copies-as often happens with untitled "advisory" reports that are not logged on the agency's docket-that's the agency's problem...
...The word "consultant" traces at least as far back as the English consulting physician, a specialist called in to give the family doctor detailed assistance on difficult cases...
...It's sweeping the world, all the way up to the throne of St...
...Consulting pay isn't usually that high, but it's always good...
...And if all the friends come through, in a single morning he can acquire a high-caliber resume: "Experience as a consultant to HEW, EPA, Marine Mammal Commission, and Bureau of Indian Affairs...
...I was only waiting it out until I got my pension...
...Everything I did was just like a consulting environment," he explains...
...Nowadays, those leaving government are drawn to consulting both for idealistic· influence and money...
...Mid-management officials have only to cope with the bitching nonsense of bureaucracy...
...By doing projects under contract, officials could commit funds without the fiscal-year limitations that usually bound their hands, and hire talented people (or cousins) regardless of their standing under the civil service rules...
...A high-GS-level manager looking to jump to consulting might call three or four similarly situated friends in government-or corner them at a dinner party-and explain his plans...
...Hickman, in his late forties, immediately began drawing a $15,000 a year pension...
...Surely only the client could know that...
...The Mariscal Corp...
...And to each crisis, the Pope offers the world's leaders not the slightest hint of what they should do about their problems...
...To get compensation for even reasonable travel or food expenses, which a conservative company would pay without flinching, they must submit to examinations that make the Nuremberg Trials seem like an awards banquet...
...Today, almost eight million people work for Washington by working for companies under contract to government...
...it also made laymen much more timid about challenging dubious work...
...These basements serve ·as offices for the partners of RAM, Inc., a recently formed environmental consulting firm...
...If Rockford worked that high a percentage of'his week, he'd own the whole trailer park by now...
...government has no secrets beyond military ones...
...Consulting companies are about the only entities in Washington without press offices...
...Joining the Cult Swirling circularities...
...Here's how your competition sizes up: . During the early days of the cult, consultants generally were drawn from industry or academics...
...Consultants looking for work frequently find that thoughts come in precisely such increments...
...Like the cultish priests they emulate, they want all client contact to take place in the privacy of the confessional...
...Ain't Just Whistlin' FORTRAN Before the computer, a government manager could wander through the file room of his agency without fear...
...They were greatly aided in this effort by the invention of the computer...
...Mitre sent its representatives and an impressive slide show to explain SPURR...
...A standing joke on Capitol Hill is the inability of any government branch to answer this seemingly rudimentary question...
...Consultants are also free to arrange for more important expense-account diversions, like that week-long "conference" at the Broadmoor Hotel...
...The Great Pretenders The trail of meaningless reports and Dom Perignon bottles left by consultants is so poorly covered, no one could fail to notice it...
...Totaling the claimed overhead, "general and administrative," and "other," expenses, Pacific received $51,022 for what would properly be called overhead...
...I didn't know anything about solar law when they called me up," Chew acknowledges, "but they heard I was a bright guy...
...Consultants evade this question by holding themselves accountable only to their agency sponsors-not to the legislature that creates and funds the agencies or the public that creates and funds the whole works...
...It has a distasteful connotation...
...It didn't matter if the mumbler had just heard the latest set of buzz-words last night, and was winging it with garbled allusions to econometric modeling...
...People cannot be compared...
...It's the perfect excuse...
...Booz-Allen's Hearle says about 15 to 20 percent of the consultant's time is "non-billable...
...Every point of inflation sends proportionately more tax money to Washington...
...Consulting companies ring the capitaldrawing at least $2 billion in federal paychecks per year into prosperous, ambiguously named organizations like BDM, ICF, Peat-Marwick, Battelle, and Cresap...
...It is that, while there is no such thing as a free lunch, you can get someone else to pay...
...When a consulting company is involved in a sleazy contract or produces a report so poor the girls in the typing pool start to giggle, it can, in theory at least, be deprived of further work...
...Arguments about such civil-servant virtues usually season Congressional hearings on consultants, which have a pronounced "We're hiring consultants...
...If 1 want to work at home, that's what 1 do...
...It changed its name to the appropriately ambiguous ICF Inc., and now is one of DOE's leading "wizard" firms, earning most of its income from specialized computer work...
...The administration made a glistening Sun Day announcement...
...Advice from outsiders-consultants who have never had the chance to fail at what the government official is supposed to accomplish-supplies a continuing sense of optimism, whether real or imagined...
...They scurry about at all levels of government, jabbering in arcane dialects, mumbling half-heard benedictions...
...Using clear language is such a serious violation of the Paper Weight Principle it is not inconceivable that Washington may someday adopt a court language, like Latin...
...One is the realization that hiring consultants in and of itself can delay actual work indefinitely...
...The morning after the conversation each can write out a purchase order for $9,800 worth of objective analysis...
...Gotten a profit on your salary lately...
...Consultants, of course, were merely a small species within the contracting genus: contractors whose business was giving advice to strangers...
...It was obvious that government managers could not possibly understand this complex new development...
...All are firms of considerable size and resources, yet the Navy sweetened their bitter task of asking for money by giving them each $75,000 grants to prepare their bids...
...His credentials were beyond dispute...
...out, everybody has forgotten whatever crisis sparked it...
...Around here we never say 'consultant,' " said a partner in Coopers & Lybrand, at $750 million a year in billings one of the largest consulting firms...
...It's getting your foot in the door that counts...
...They used languages like FORTRAN, which not even those who could speak could speak...
...The second contract is for $9 million...
...Congressmen get to nod gravely...
...The grant, Hickman said, will help it provide "technical assistance," stage "modular seminars," and publish a newsletter...
...Now security, money, and the image of purity are all available at the same stop on the Beltway .. "Fifteen years ago," says Richard Irish, a consultant who specializes in headhunting for other consultants, "people were telling me, 'I'd love to go work for the Bureau of Indian Affairs, but I can't afford to turn down IBM.' Now they say, 'There's real challenge at IBM, but who can turn down the money at the Bureau of Indian Affairs?, " The 10K Form If you're not intimidated by the competition, and would like one of the contracts from the Bureau of Indian Affairs, here's your first step: have a $9,999 idea...
...You have to get in...
...High-level officials, on the other hand, are marinated in a caustic, back-stabbing atmosphere that can be as rough as anything Madison Avenue offers...
...What you get on the low-bid contract is irrelevant," says a Senate staffer...
...brigh_t .p~r:s_on can fail to notice that, while the industrial empires are fraying at the edges, Washington's center grows ever more dense...
...and now says 19,000...
...It's fun to operate out of your basement and have a free lifestyle after all these years," Cummings explains...
...meanwhile the official "size" of the government, 2.5 million civil servants, has scarcely changed in 20 years...
...Almost all of its projects failed...
...So Mitre's model was endorsed...
...Government officials exposed to contracting out quickly discovered it had virtues unrelated to military might...
...For $50,000 you can buy a lot of lunches...
...Trading one for the other probably sounds like a dynamic reform...
...So far RAM has contracts with Virginia, New York, and the District of Columbia...
...The boss gets to tell Congress the cavalry is coming...
...Disgruntled academics called a conference at DOE's Solar Energy Research Institute in Golden, Colorado, to debate SPURR...
...This was particularly important under Eisenhower, Nixon, Ford, and now Carter, when presidents desiring to maintain the fiction that government is not growing imposed strict civil-service hiring limits...
...To protect themselves from possible criticism HEW officials commissioned a $750,000 studyone study dollar for every four project dollars in HEW's $3-million grant...
...Could either consultant predict, the White House asked, that solar would someday supply 20 percent of the country's electricity...
...Energy and Environmental Analysis, a hungry young consulting firm of ex-Whiz Kids, and old stand-by Mitre were hired to devise computer models...
...Once you have sufficient contracts, your next challenge is to master billing techniques...
...But putting the conclusions in plain English ruined their Paper Weight Principle value to NHTSA, especially since the crystalline projections made it that much easier for NHTSA critics to claim the agency itself was adding to Chrysler's woes...
...The cold objectivity of the conSUltant's stopwatch and transitory status were his greatest assets...
...You can't lose...
...It later won a related contract-justified by its possession of the first contract-to expand the system...
...DOE's Inspector General recently analyzed 17 contracts let by the agency's Office of Solar Applications...
...25-billion short of capital last summer-turned out to be quite precise...
...But luckily the energy crisis happened along...
...The consultant's assignment was only temporary-to give brutally frank advice to the businessman with a sick company on his hands...
...a desire to be ready for war...
...In some respects, consulting was encouraged as a means to contravene the stodgy bureaucracy...
...Does it benefit anyone besides the consultant himself...
...Most of the contractors, then as now, supplied material goods like fighter planes and patriotic bunting...
...But that's not it...
...Right Over Their Heads Nearly all the creative potential of consultant billing is expressed in a virtuoso contract written by Pacific Consultants, Inc., of Washington, covering work done for AID by a single consultant, Frank Ballance, and his secretary...
...Reformers mistakenly assume that the fee accepted by the lower bidder bears some correlation to what he is actually paid...
...With the advent of computers, this ceased to be so...
...Its second modification-an extension covering the two weeks from September 30 to October 12-was for $16,000: That's $1,600 a day...
...And what the consultant makes on any given job must cover all these expenses while he's not working...
...In the Eisenhower administration, most appointees were happy to take the prestige of government work back with them into private industry jobs where the real money was...
...And if most of their "work product" can be obtained with a phone call to an agency library...
...There was no controversy over The Futures Group's report...
...He paused to scan the expectant assembly...
...It's not prudent, he says, to act before the results are in...
...Most are dimly aware as well that consultants have been getting into trouble recently...
...For mid-management government officials, the jump to consulting was not without risks...
...Yet even sincere public officials, fully aware of the problem, continue to demand consulting services...
...The continuing preparation for war demonstrates...
...Things might be in disarray-liverwurst sandwiches and urgent cables filed together under "Inactive"-but if he looked at any given thing in any given drawer, he knew what it was...
...The guy who gets the results is new...
...When Harbridge's report came out, NHTSA administrator Joan Claybrook was so furious she disowned it publicly...
...Proposals are accepted, and evaluators pour over them, awarding points based on recondite rating systems...
...A better approach is to correct the problem's cause by making civil servants accountable, and instilling in them the sense of vigor and determination they lack...
...Is the work meaningful...
...Government officials hate competitive bidding...
...The Pope is talking like a consultant...
...This is the dry-cleaning establishment of money laundering...
...Hired guns are not responsible for the selection of targets...
...Why aren't the consultants laughed out of town...
...My God...
...As it happened, NHTSA had simultaneously cOmmissioned another consultant, The Futures Group, to study the same question...
...nothing improper here, not by any standard...
...You tell it what it pays to hear...
...A contract extension is in the works...
...Before the war, for instance, when the Navy wanted a new battle cruiser, armor plate and cannons were forged at a naval ordnance plant, while the hull was fabricated and assembled at a naval shipyard...
...That's the client's judgment...
...Some are so involved no person can describe a formula for achieving them: "End racial hatred...
...Because of such fastidiousness, nobody knows just how many consultants work for the government, or just what they cost...
...As it happened, Harbridge's predictions-for instance, that Chrysler would fall $1...
...To the extent that is true, it is foolish to try to correct the problem's symptoms by reforming the consulting industry...
...They don't call them awards for nothing...
...it seemed only natural to reach out to consultants, with their resumes and degrees, for assistance...
...The Paper Weight Principle The discovery that consultants would tell government whatever it paid to hear was one of the great visionary moments in modern Washington history...
...The consultant is responsible solely to his client," Caputo says...
...Critics like Rep...
...The grand pronouncements somehow ring hollow...
...The New York contract, for instance, pays the RAM principals $400 a day to write the state plan and explain the law...
...Shifting again, he advised that "disturbing factors are frequently present in the frightful disparities between excessively rich groups and individuals, and the majority who make up the poor...
...But the Hyatt's commanding view of the historic Capitol dome would have gone to waste...
...In the 1950s, civil service classifications could not offer the kind of salaries needed to attract quality scientists...
...Nowhere does it appear on the exhaustive government expense-account...
...Once you break the $10,000 barrier, you'll find the cushy contracts awarded either by competitive bidding or as "sole source...
...The answer was the kind of spirited affirmation a rich crook gets when he asks Edward Bennett Williams if every man has the right to an attorney...
...Booz-Allen says it will not discuss even past studies unless ordered to do so by its client agency...
Vol. 12 • May 1980 • No. 3
