Traditional ways of approaching issues of development give preference to questions that seek to establish differences between developed and developing countries on specific issues. Put differently, we are used to defining and deriving policy from the experiences of states that distinguish themselves from rank-and-file statehood in the world system. For instance, it is customary to compare the U.S. and Africa’s GDP and derive inferences for African reforms more or less suggested by the path the U.S. took.
To some extent, this ‘prescriptive’ approach is reasonable because it allows developing countries to learn from developed countries without having to reinvent the wheel of development. Nevertheless, knowledge and intervention derived from ‘prescriptive’ comparative studies that solely focus on differences between developed and developing countries often fail to produce expected outcomes because they pay little or no attention to the learning processes of developing countries. Thus, while the emphasis on ‘difference’ is suited for prescriptive policies, it remains ill-fitted for ‘comparative understanding’ of important politico-economic problems in the world.
In contrast to GDP and other differential markers used to measure the evolution of societies and politico-economic institutions in the world system, similarity-based comparison yields high pedagogical value for both developed and developing countries. Public procurement is one of the many areas of study amendable to such a similarity-based comparison. With procurement studies, one could appreciate similarity and adopt a comprehensive –and, might I suggest, more humble? — approach to development models for developing countries. More often than not, mistakes made by government officials and parastatal procuring entities point to the same challenges that developed and developing states face. Two procurement stories involving the U.S. government at home and abroad illustrate this point.
In a televised interview recorded in Sept. 2010, Ashton Carter, the U.S. Under Secretary of Defense for Acquisition,Technology and Logistics, announced that the defense budget won’t go up or down but should stay within the limits of “the resources that the country and the taxpayer can afford.” He also predicted that the new post-9/11 era is going to be ‘good for industry and government.’
However, a report on the administration of provisions to troops in Afghanistan by the Inspector General of the United States Department of Defense released on March 2, 2011 shows that what is ‘good for government and for industry’ might exceed what the U.S taxpayer can afford. The report shows that the Defense Logistic Agency failed to provide ‘sufficient oversight of contract, cost, and performance.’ That is, the vendor for food products for Afghanistan was overpaid for work that remains incomplete.
What is interesting in this story is the ways in which the initial contract with the food vendor for Afghanistan was changed through a simple verbal order, which, as the Inspector General found, violated the provisions of the Federal Acquisition Regulation and Defense Federal Acquisition Regulation Supplement. The report clearly states that the verbal change of the contracting order by U.S. officials led to overpayment of the food supplier in Afghanistan. Because the modification of the initial contract through a verbal agreement between U.S. contracting officers and the Afghanistan food supplier was not definitized, transportation costs were exaggerated and the contractor was overpaid. Hence the verdict of insufficient oversight of cost.
Unfortunately, delays and overpayment related to cost assessment are not limited to U.S. activities abroad and in combat zones. Last year, the Inspector General for the U.S. Department of Veteran Affairs (VA) audited the Strategic Asset Management Pilot (SAM) project and found that the managers did not control cost. In the report, selected contractors unfamiliar with the VA’s needs poorly managed risk. Consequently, the SAM pilot project was delayed by more than 17 months potentially ‘doubling the original contract cost of $ 8 million.’
Delays, overspending and missed deadlines, poor cost and risk assessment in public contract renegotiation makes the U.S. procurement system less than perfect. In this sense, contract renegotiation mistakes made with the food vendor in Afghanistan and delays with the SAM project are similar to procurement challenges in Cameroon and Zimbabwe commented on last week.
Procurement challenges observed in Cameroon, Zimbabwe and the U.S. at the implementation and renegotiation phases highlight relative similarities between developing and developed countries in the management of public finances. Attention to government procurement makes the case for unbiased similarity-based case selection for ‘comparative understanding’ that could yield high pedagogical value because of the preeminent roles that decision making and forecasting play in defining outcomes. S.N. Nyeck.