Can the shutdown lead to better government?
Here's how to ensure better governemnt and business operations for the future
- By Jerry McGinn, Ph.D, John Hillen
- Jan 22, 2019
The partial government shutdown is deep into week five and is really beginning to bite.
TSA lines at airports across the country are lengthening dramatically and companies are adopting increasingly creative strategies to keep workers on the payroll and, in some cases, stay afloat. Despite the havoc that this shutdown is wreaking on the business of government as well as the operations of many of the businesses that support the government, this shutdown will end somehow and sometime, hopefully in the very near term.
The blame game and finger-pointing will continue after the shutdown, but the real question in our minds, is this: how do we learn from this episode and prevent disruption to key government and business processes and functions in future budgetary standoffs? Notwithstanding the recent history of recurrent continuing resolutions and numerous short-term government shutdowns, we actually see the seeds of a longer-term solution in the current crisis.
Throughout our careers, we have both served in senior roles in government and in also in the companies that support the key missions and work of the federal government. We know firsthand the impacts that budgetary brinksmanship has had on government and company operations.
We have unfortunately become used to this environment to a degree—developing and executing contingency plans to address contract performance and keep essential governmental operations running amid budgetary turbulence. This is, as the expression says, no way to run a railroad.
What has been frankly inspiring about the current shutdown, however, is the true dedication, professionalism, and indeed patriotism of the impacted government agencies and companies.
Amidst significant financial hardships, for example, air traffic controllers, border patrol agents, and other federal employees continue to fulfill their duties; furloughed workers check in with their agencies and eagerly await the call to return to their offices; and essential government services continue to be delivered. Unfortunately, too many government workers who are not furloughed are ironically spending an inordinate of their time managing the shutdown—trying to find other legally-appropriate sources of funds to maintain operations, determining what work can continue and for how long, etc.—rather than performing their assigned duties.
Companies are similarly making tremendous sacrifices to continue operations in any way they can. Like the government, they are spending a great deal of time managing the shutdown: speaking with customers and sub-contractors on a daily basis, managing staff by moving personnel to non-impacted projects and encouraging employees to take leave, freezing new hires, working with banks to forecast how long company lines of credit will support payroll and other operational expenses, etc.
Sue Evans, CEO of Evans Incorporated, which serves the Federal Aviation Administration and other federal clients, has not laid off any staff and engages daily with customers and staff. She notes, “the most important thing any government contracting leader can do is to be transparent with employees and communicate all news—with honesty as often as possible.”
Ali Reza Manouchehri, CEO of MetroStar Systems, similarly remarks as his company is losing tens of thousands of dollars in revenue each day, “Our nation is at crisis of trust and we must focus on things we can control – our employees trust and wellbeing, commitment to our customers and mission, and building stronger leaders through this crisis.”
In addition to the government and companies, others are also stepping into the breach. Restaurants and other establishments across the nation have offered free or reduced rate meals, products, or services for impacted workers. Universities, including ours, have offered free workshops and classes to those affected by the shutdown. This civic outpouring demonstrates the broad impact that the shutdown of part of the $500 billion government contracting community is having on the larger economy and society.
These public and private sector actions demonstrate three things in our view: first, our government and business leaders are fully committed to the missions they are conducting to support our nation; second, the current situation is the opposite of what we need given the profound challenges facing our country today; and, third, the business of our government needs to operate in a responsive and effective way to meet the need of our citizens.
To that end, we are putting forward two modest proposals that should be undertaken as soon as the current shutdown ends.
First, the branches of our government need to change the way that they conduct the business of government, at least in the budgetary process. We need to stop the chaos of brinkmanship in the appropriation of federal funds. The bill introduced by Sen. Rob Portman (R-OH) is a great first step in that effort. That bill, if enacted, would ensure that the government continues to operate as the executive and legislative branches negotiate annual appropriation bills for government operations. Those branches need time to come to mutually agreeable solutions and they should have that time without impacting the operations of government and the companies that support them.
Second, government and industry need to work together to address an array of important challenges that impact the business of government. From simplifying the acquisition process to make it easier to do business with the government to helping small businesses transition and grow from government set-aside programs to creating new frameworks for intellectual property collaboration in high technology areas, there is a great deal of work to be done to improve how we deliver effective programs, products, and solutions that make the best use of taxpayer dollars. There are a number of initiatives underway to address these and other important government contracting issues, but—channeling that cult classic This Is Spinal Tap—government and industry need to take these efforts to “eleven” once the current shutdown ends.
There are ways that key programs, processes, and business can continue even during a budget imbroglio. Research from one of our academic colleagues has shown the added cost to large programs when they are stopped and “re-baselined.” Every stoppage of work on hundreds of thousands of important discrete programs and projects has the same effect. In the end it will cost the taxpayer time and money.
As the current crisis clearly demonstrates, there are willing partners on all sides to address these important issues. When the shutdown ends, let’s put our full attention on improving how government and industry, as well as the broader community, work together to deliver effective government operations and get the best value for the American taxpayer.
Dr. Jerry McGinn is the Executive Director of the Center for Government Contracting in the School of Business at George Mason University (GMU). In this role, he has established and is leading the first-of-its-kind university center for research, education and training, and collaboration on issues facing the $500B+ government contracting industry. He has an active Top Secret clearance and has recently been nominated for restoring his access to Sensitive Compartmentalized Information.
Jerry is also a trusted strategic advisor sought after for his expertise in U.S. industrial policy, supply chain, industrial security, export control, foreign military sales, and industrial base policies and he currently serves on the Economic Security Subcommittee of the Homeland Security Advisory Council. Prior to joining GMU, Jerry served as the senior career official in the Office of Manufacturing and Industrial Base Policy in the Department of Defense, leading efforts to analyze the capabilities and overall health of the defense industrial base, including the Presidentially-directed 2017-2018 interagency review of the manufacturing and defense industrial base. He also directed hundreds of reviews of high-profile mergers and acquisitions as well as transactions before the Committee on Foreign Investment in the United States.
Previous to DoD, Dr. McGinn spent a decade in senior defense industry roles at McGinn Defense Consulting LLC, Deloitte Consulting LLP, QinetiQ North America, and Northrop Grumman. Before industry, Dr. McGinn served in DoD as Special Assistant to the Principal Deputy Undersecretary (Policy) and as a political scientist at RAND.
Dr. McGinn is also a widely acclaimed thought leader, author, and sought-after speaker. He has published numerous influential RAND monographs and articles in The Hill, Business Insider, Defense News, Washington Technology, War on the Rocks, and Joint Force Quarterly. He has also testified before the U.S. Congress and the UK House of Commons and he is regularly interviewed and cited in outlets such as USA Today, The Financial Times, The Los Angeles Times, Politico, Government Matters, Federal News Network, and Time. He has led advisory studies for and held leadership roles in the NATO Industrial Advisory Group, the Defense Science Board, the Aerospace Industries Association, and the Professional Services Council.
Dr. McGinn was commissioned into the U.S. Army and served with distinction as an infantry officer and is a graduate of Ranger and Airborne Schools. He has received numerous civilian and military awards and has earned a Ph.D., M.S., and M.A. from Georgetown University as well as a B.S. from the United States Military Academy.
John Hillen is the CEO of EverWatch Solutions and is a former Assistant Secretary of State for Political-Military Affairs, and former Chairman of the Professional Services Council.