The government waste DOGE should be cutting(theatlantic.com)
theatlantic.com
The government waste DOGE should be cutting
https://www.theatlantic.com/ideas/archive/2025/02/doge-government-contractors/681661/
5 comments
[deleted]
The problem that really needs fixing is not the public employees but the private contractors—and Elon Musk is one of them.
exactly - it's the corrupt bidding process.
everyone wants to complain about inefficant government.
"In 2021, administrative costs for traditional Medicare were $10.8 billion, which was 1.3% of total program spending"
"According to most estimates, the average administrative cost for insurance companies in the United States falls between 12% and 18% of their total revenue, with some sources stating that private health insurers specifically spend around 17% on administrative costs"
The cost of capital for insurance companies can vary depending on the line of business and market conditions, but generally falls within a range of 8% to 12%; with profits typically ranging from 2% to 10% of revenue, meaning most insurance companies aim for a net profit margin within this range.
exactly - it's the corrupt bidding process.
everyone wants to complain about inefficant government.
"In 2021, administrative costs for traditional Medicare were $10.8 billion, which was 1.3% of total program spending"
"According to most estimates, the average administrative cost for insurance companies in the United States falls between 12% and 18% of their total revenue, with some sources stating that private health insurers specifically spend around 17% on administrative costs"
The cost of capital for insurance companies can vary depending on the line of business and market conditions, but generally falls within a range of 8% to 12%; with profits typically ranging from 2% to 10% of revenue, meaning most insurance companies aim for a net profit margin within this range.
Agreed! Many complain of a inefficient government and that’s silly because the US gov provides very little compared to others. Most of what is provided to us in America is private; health insurance, pharmacies, doctors, education, retirement, lack of corporate social safety net, (PTO, sick, vacation, parental leave, etc.), utilities/energy, and most of these private services are inflated, inefficient and unresponsive to US citizens needs because these private industries have bribed their way into crafting laws that protect them and keep their foot on our necks. US Corporations profit the most and we get the least for the maximum cost. This is by design. It’s a feature not a bug.
> The problem that really needs fixing is not the public employees but the private contractors
It's a combination. Many of the people running contracts (my experience is from DOD contracts, others may be better or worse) are not actually capable of evaluating what the contractors are doing or promising when it's technical work. That is, go into the program offices and you will find a severe lack of technical competency or contemporary technical competency especially around IT systems (mechanical and electrical are much better). It's easy to sell someone a bad IT solution when the program offices have no one who is a software or IT expert (typically they hire EEs for this in USAF0.
This leads to some spectacular failures especially as they prefer (in the program offices) Waterfall-style project management which, at scale, does not work.
Some recent projects I've had the displeasure of being associated with (not my work, but "across the hall" as it were) are a $60 million 3-year effort to replace a DOS-based system (canceled). This was 15 years ago and it still hasn't been replaced, the latest replacement effort is several years late and I don't know how far over budget. A $5 million 6-month effort that is still ongoing and still costing about $10 million per year 5 years later for what should have been network switch upgrades (but somehow they made it more complicated). A $500 million 8-year contract that is still (this year, per former colleague) using VS 2008 and just got onto Windows 10 (EOL/EOS this year). And this was all in one small corner of all of DOD. The contractors are not held to account, and the program offices are too often unable to hold them to account.
One of the worst I personally saw was a 10-figure failure (they eventually delivered half the capabilities 4 or so years late and way over budget), where the program office put a poor 1st Lt with a history degree in charge of a major IT system overhaul.
The program offices need to be overhauled, and the contractors need to be held to account for their own failures.
It's a combination. Many of the people running contracts (my experience is from DOD contracts, others may be better or worse) are not actually capable of evaluating what the contractors are doing or promising when it's technical work. That is, go into the program offices and you will find a severe lack of technical competency or contemporary technical competency especially around IT systems (mechanical and electrical are much better). It's easy to sell someone a bad IT solution when the program offices have no one who is a software or IT expert (typically they hire EEs for this in USAF0.
This leads to some spectacular failures especially as they prefer (in the program offices) Waterfall-style project management which, at scale, does not work.
Some recent projects I've had the displeasure of being associated with (not my work, but "across the hall" as it were) are a $60 million 3-year effort to replace a DOS-based system (canceled). This was 15 years ago and it still hasn't been replaced, the latest replacement effort is several years late and I don't know how far over budget. A $5 million 6-month effort that is still ongoing and still costing about $10 million per year 5 years later for what should have been network switch upgrades (but somehow they made it more complicated). A $500 million 8-year contract that is still (this year, per former colleague) using VS 2008 and just got onto Windows 10 (EOL/EOS this year). And this was all in one small corner of all of DOD. The contractors are not held to account, and the program offices are too often unable to hold them to account.
One of the worst I personally saw was a 10-figure failure (they eventually delivered half the capabilities 4 or so years late and way over budget), where the program office put a poor 1st Lt with a history degree in charge of a major IT system overhaul.
The program offices need to be overhauled, and the contractors need to be held to account for their own failures.
It doesn't sounds at all like internal cut could be the solution. The solution could be hiring better people with potentially better compensation. So you actually need to pay government employees more and direct cut towards contractor headcount instead.
https://www.nytimes.com/2025/02/12/us/politics/trump-tesla-m...