Treasury seeks broader acquisition powers

If Congress passes a financial bailout plan, it is likely to include a provision giving the Treasury secretary the power to waive regulations covering the government's hiring of contractors, the Washington Post reports.

While the nation's current economic situation gives everybody a headache, this provision, even though restrained when compared with the original, gives federal employees heartburn.

Treasury Secretary Henry M. Paulson Jr. wants the ability to move quickly to smooth the very rocky road that is now Wall Street. He proposed granting his office essentially unlimited authority to hire outside firms to help manage the assets of companies the government basically nationalizes.

He didn't get that. But under the legislation the House rejected yesterday, he still would have had extensive authority to ignore regulations on federal acquisitions. That provision, or a similar one, probably will be in whatever legislation finally passes.

That's anathema to federal workers who recoil at Bush administration efforts to give public business to private companies.

"We are not comfortable with Treasury being granted authority to waive contracting procedures," said Richard N. Brown, president of the National Federation of Federal Employees, with some bit of understatement. "It is an unnecessary power grab and we can envision this authority being abused."

The bailout bill says Paulson can disregard the regulations "upon a determination that urgent and compelling circumstances make compliance with such provisions contrary to the public interest."

Federal acquisition regulations generally can be waived in other cases, but this authority is "much broader" than what officials normally have, according to Alan Chvotkin, executive vice president of the Professional Services Council, the trade association for companies with government contracts.

The government did not use such broad authority even after Hurricane Katrina or during the war in Iraq, Chvotkin said.