Summaries for August 1, 2009

BRUCE MCCONNELL ARRIVES BACK INTO THE FUTURE
Driven by an attraction to the mission and to public service itself, Bruce McConnell has returned to federal service. McConnell is counselor to Phil Reitinger, Deputy Under Secretary for the National Protection and Programs Directorate at the Department of Homeland Security (DHS.) That's the component of DHS concerned in part with cyber security. And, five weeks into the job, he says he is having a great time, even though, or perhaps because, his challenges are formidable.  -> Read More

HOUSE HEALTH BILL'S IT IMPLICATIONS DWARF THE RECORDS INITIATIVE
Congress has left town temporarily without coming to consensus on how or if there will be health care reform. But assuming something will emerge in September, expect it to greatly expand the government's IT requirements on the magnitude of several billion dollars per year. The House's health care bill's briefly-worded purpose: "To provide affordable, quality health care for all Americans and reduce the growth in health care spending, and for other purposes." The IT implications of this bill go above and beyond the electronic health records initiative, which health care reform would dwarf.  -> Read More

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OBAMA SHOULD APPOINT FIELD TO TOP SLOT AT OFPP
In "The Wizard of Oz" movie version, Dorothy learned that often what you search far and wide for, you had close at hand all along. The appointment last Thursday of Danny Werfel to Controller at the Office of Management and Budget was welcome news. So why not appoint Lesley Field to be administrator of the Office of Federal Procurement Policy? Currently the deputy administrator, as full administrator she would have the appointed clout necessary to make some of the big things happen.  -> Read More

FEDERAL GOVERNMENT PREPARES TO ENTER THE BROADBAND BUSINESS
A big customer of telecommunications, the federal government has not traditionally driven technology or supplier development in this area, but has been more a beneficiary of it. Dating back to the very first Federal Telephone Service contract in 1963, the government has been able to use its volume clout to get the best available prices on services developed primarily for commercial use. Now the Obama administration, in part via funding in the February 2009 stimulus spending bill, wants to make broadband Internet access a totally ubiquitous service. How appealing this program will be to the big telecomm companies is an open question.   -> Read More

• Bruce McConnell Arrives Back Into The Future

  Bruce McConnell

  Driven by an attraction to the mission and to public service itself, Bruce McConnell has returned to the federal government. And, five weeks into the job, he says he is having a great time, even though, or perhaps because, his challenges are formidable.

  McConnell is counselor to Phil Reitinger, Deputy Under Secretary for the National Protection and Programs Directorate at the Department of Homeland Security. That's the component of DHS concerned in part with cyber security. Although the Obama administration is adding a cyber security coordinator to the White House staff, DHS and other agencies will still have important pieces of the total cyber responsibility. DHS will primarily have the .gov and .com domains and the National Security Agency .mil.

  In blogs and in this interview, McConnell has pointed out that 16 years have passed since publication of the Peter Steiner "On the Internet noboby knows you're a dog" cartoon in The New Yorker.

  While the cartoon to this day remains a cultural phenomenon and tech-speech standard reference, McConnell said that slow progress on authentication and identity management still cause security problems in a world exponentially more connected than in 1993.

  "It's still true but not so funny," he said. And so one of McConnell's two top long-term projects at DHS is helping devise an up-to-date ID management policy, one that balances privacy against the need to crack anonymity during, say, a distributed denial-of-service attack like the one that hit several departments around July 4.  "An ID regime must be done carefully with different constituencies. We need a better sense of who's who -- people and machines and devices -- but there are situations when it's better to be private, for example, political speech," he said.

  McConnell's other principal project at DHS is "getting public-private partnerships in better shape. That's harder than is usually thought." The concept is broader than the contractor-government relationship, although that is part of it. It also encompasses private-sector ownership of large pieces of critical IT infrastructure. The Obama administration says that while it does not want to dictate security standards or practices to the private sector, the two sides should be more coordinated when it comes to sharing best practices and response to an attack on, say, the electrical grid. This all requires trust-building, McConnell said.

  He is no stranger to situations requiring public-private trust. After leaving the Office of Information and Regulatory Affairs at OMB in 1999, McConnell directed the Y2K Cooperation Center under the auspices of the United Nations and World Bank when practically every large organization was dealing with potential problems from two-digit date codes as 1999 turned to 2000.

  Has cyber security strategy changed much with the administration change?  Not drastically, McConnell said. A lot of good efforts were launched by the Bush administration he said, but having direct presidential backing for the 60-day review, which lead to the promise of appointing a cyber coordinator, plus an increase in public engagement, is speeding the process of finding ways to improve cyber strategy.

  McConnell called the latter process "opening the conversation, declassifying the analysis and having open debates on what government can do."

  Cyber cooperation between the government and private sector must also be matched by cooperation among nations.  For instance, the Commerce Department is engaging the multinational Internet Corporation for Assigned Names and Numbers, ICANN, to get security software installed on the Internet’s root servers.  McConnell said that, for the U.S. part, the negotiations with ICANN are an interagency effort that includes DHS, the State Department and the White House.

  A more fundamental question: Will international cyber relations be governed by treaties or, as the Obama administration is pursuing, by law enforcement agreement? McConnell said, "Treaties and law enforcement are not mutually exclusive. Treaties take a long time, and we're not ready today. So we need to work ad hoc, setting partial mechanisms and finding the right setup."

  While contributing to the long-term issues, McConnell said he is renewing acquaintances with fellow federal managers from back in the day, and meeting a lot of newer, younger public servants. He said his nearly decade-long stint as a consultant has deepened his understanding of the pressures federal contractors are under and of how dedicated most of them are.

  McConnell said he is motivated by serving what he described as "the unprecedented president." And, he said, "I do believe we are at a turning point of global history in the way IT is changing the way people interact. So we need to do it in a way we can trust machines or else there will be a setback in the development of the planet."

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• House Health Bill's IT Implications Dwarf the Records Initiative

  Congress has left town for its August recess without coming to consensus on how or if there will be health care reform. But assuming something will emerge in September, expect it to greatly expand the government’s IT requirements on the magnitude of several billion dollars per year. This will be so even if a diminished bill gets enacted.
  
  The House’s health care bill’s briefly-worded purpose: “To provide affordable, quality health care for all Americans and reduce the growth in health care spending, and for other purposes.” Estimated price tag for reducing health care spending: $1.5 trillion over 10 years. Who really knows?
  
  Whether it is wise or right to federalize health care – and make no mistake, the version of reform fervently hoped for by the Nancy Pelosi-Henry Waxman wing of the Democratic majority would put the federal government in charge of everyone’s health care – is a debate for another venue. But it is accurate to say the IT implications go above and beyond the electronic health records initiative, which health care reform would dwarf.
  
  On page 72 (of nearly 1,000) Title II begins to describe the Health Insurance Exchange: “There is established within the Health Choices Administration and under the direction of [a] Commission a Health Insurance Exchange in order to facilitate access of individuals and employers through a transparent process, to a variety of choices of affordable, quality health insurance coverage, including a public health insurance option.”
  
  The exchange would operate as a marketplace of federally-approved insurance plans for individuals, families and businesses. Many paragraphs describe who is eligible, but my point is this: Operating this national exchange will require construction of an IT support infrastructure of challenging proportions. The bill describes a rules-driven process of fairly immense complexity.
  
  Here’s a typical detail: “In the case of an affordable credit-eligible individual (as defined in section 242(a)(1)) enrolled in an Exchange-participating health benefits plan, the benefits under a basic plan are modified to provide for the reduced cost-sharing for the income tier applicable to the individual under section 244(c).” Probably not even Waxman has read these gems.
  
  Equally non-trivial will be the financial transaction IT engine supporting the exchange. Think of the supporting mechanisms for Medicare, Medicaid, Veterans Affairs and the Defense Department’s Tri-Care. Now add the means to support another, what, 100 million or so people and you can see that the government is potentially creating the personnel and IT equivalent of a new department.
  
  The Senate version is less ambitious, creating instead a “government option,” regional, non-profit health plan cooperatives operating within an exchange format. But it won’t leave the government out of health care, not by a long shot.
  
  Also part of the planning is a big and ongoing statistical research program to measure the effectiveness and efficiency of various medical treatments and practices. Just as agencies like the Food and Drug Administration have significant IT machinery to support research, so will the entity – likely within the Health and Human Services Department – that does comparative effectiveness research.
  
  One reason the so-called Blue Dog Democrats wanted to hold off on a vote that the president was pushing to take place last week was so that they could have a chance to actually read the bill. Some certain members of the House leadership, including Waxman (D-Calif.) and John Conyers (D-Mich.), pointedly and arrogantly did not do so. I suggest you at least skim it to get a sense of the scope of what is being proposed.

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• Obama Should Appoint Field To Top Slot At OFPP

  In "The Wizard of Oz" movie version, Dorothy learned that often what you search far and wide for, you had close at hand all along. The appointment last Thursday of Danny Werfel to Controller at the Office of Management and Budget was welcome news. Werfel is a career federal manager and has been Deputy Controller since 2006.  He has been a tireless and articulate proponent of better financial management, in recent months burning midnight oil to help create the blizzard of spending guidance that has come out of OMB since the start of the Obama administration.

  So why not appoint Lesley Field to be administrator of the Office of Federal Procurement Policy (OFPP)? Currently the deputy administrator, Field as full administrator would gain the appointed clout necessary to make some of the big things happen.

  Frankly, OFPP has been something of a backwater for too long. Not since the days of the jolly warrior Steve Kelman during the first term in the Clinton administration has OFPP been at the vanguard of reform. While some fine deputies have served in those intervening years, such as Rob Burton, now a lawyer in private practice, and Field, the administrators have been a somewhat undistinguished bunch. One, David Safavian, got caught up in the scandals of jailed lobbyist Jack Abramoff. Serious but not self-important, Field has the knowledge and chops to handle the administrator's job.

  Field is known to the acquisition and contractor communities and, as far as I can tell, has their trust and confidence. Such an appointment could not come too soon. Here's why:

  Last week the OMB issued a flurry of memos on contracting management goals. At the heart of the new orders  is this: "...each agency shall develop a plan to save 3.5 percent of baseline contract spending in FY 2010 and a further 3.5 percent in FY 2011." The memo is presented as "guidance on reviewing existing contracts and acquisition practices." The memo goes on at length to explain the ways agencies can reach the reduction goals, including better use of IT in contract management, improving skills of the acquisition workforce, being more "strategic" in approaching the buying process, and so on.

  Thus, as Stan Soloway, president of the Professional Services Council, said during a Federal News Radio interview , the OMB memo is not a siren call to slash contracting, get rid of contractors, or shred existing contracts wholesale. To be sure, OMB is calling for a 10 percent reduction in spending on contracts awarded non-competitively or for cost-plus and time-and-material contracts. But mainly it is emphasizing the importance of careful and skilled sourcing and acquisition.

  The memo described above was signed by OMB Director Peter Orszag. A second, simultaneous memo  carried the signature of Field herself. It describes new requirements in the Federal Acquisition Regulation that reinforce the use of contractor past-performance by acquisition and other agency staff. The irony here is that this is precisely one of the initiatives that Kellman pushed as OFPP administrator in the mid 1990s. As I recall, he held a dramatic ceremony in the ornate Indian Treaty Room of the Old Executive Office Building (as it used to be known) and had acquisition officers stand and pledge their commitment to use past performance. Somewhat comically, perhaps, the point was made.

  Now there is an online database, PPIRS, (rhymes with jeepers) to which all sorts of information must be submitted on contractor performance, and this includes responsible parties within the agencies, underscoring this administration's emphasis on accountability and weeding out bad contractor actors. Field notes in her memo that starting early next year, OFPP will start to audit compliance to the new FAR requirements.

  Beyond all of this new contracting guidance lie the lingering problems. Chiefly, the mess that is the self-contradicting complex of small and disadvantaged set-aside programs, including the Alaska Native Corporation charade and the HUBzone scandal. The Small Business Administration under Administrator Karen Mills is starting to go after these problems. Mills told a House committee last week that her agency staff had conducted 600 site visits to HUBzone companies to make sure they weren't phony, using the addresses of vacant buildings or coffee shops.

  But this effort would be enhanced by a full administrator in place at OFPP. The administrator would be an important partner to the acquisition community as well as to the SBA. And, by extension, the office could enlist the expertise of contractors themselves with much more authority than even a well-respected career person can. For all of its purported desire to improve contracting, it is surprising the Obama administration has not already named someone. Well, like Dorothy, it doesn't have to look much further than its own backyard to find a solid candidate.

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• Federal Government Prepares To Enter the Broadband Business

  A big customer of telecommunications, the federal government has not traditionally driven technology or supplier development in this area, but has been more a beneficiary of it. That stands in contrast to, say, the military role in pushing aviation state-of-the-art. Dating back to the very first Federal Telephone Service contract in 1963, the government has been able to use its volume clout to get the best available prices on services developed primarily for commercial use. So it is more recently with wireless datacomm, cell phones, voice over IP. Sometimes the government's desire to drive a market takes a long time. One example: interoperable emergency radio communications, something the federal government has been pushing for 15 years. Even the boost caused by the 9/11 attacks has not yet resulted in a robust market.

  But now the Obama administration, in part via funding in the February 2009 stimulus spending bill, wants to make broadband Internet access a totally ubiquitous service, akin to the universal telephone service notion of a century ago that drove connections to the middle of the Mojave desert. At this point, no one really knows exactly which parts of the country don't have broadband, and that might not be known until early next year, when the Commerce Department is supposed to complete a census for which it received $300 million stimulus dollars. In the meantime, the grants apparatus and concomitant rule-making apparatus for building broadband in local areas is rolling out anyway, with the Agriculture Department's Rural Utilities Service responsible for rural-area grants and Commerce's National Telecommunications and Information Administration  (NTIA) for other under-served areas.

  How appealing this program will be to the big telecomm companies is an open question. They may like neither the so-called "net neutrality" provisions nor the requirement for access to their networks by small carriers. Also to contemplate: Will federally funded broadband service function competitively (and unfairly by some accounts precisely because of the subsidy) to private services, in the same way that the administration wants a national health plan to keep private insurers "honest." So far the Speaker of the House, Nancy Pelosi, hasn't called telecommunications providers "villains" as she did health insurance companies last week.

  The potential irony in this plan is that the government, while not really furthering technological innovation, might be tamping down on an industry in which the competitiveness has driven innovation to astonishing heights. Somehow watchers of cartoons in the 1960s always hoped that the Dick Tracy 2-Way TV Watch would become a reality.  We just didn't expect it to be as close in 2009 as maybe the next version of the iPhone or some such.

  In a short interview with the Wall Street Journal last week, the new FCC chairman and Obama chum, Julius Genachowski, said, curiously, that his first priority would not be universal broadband but rather looking into cell phone manufacturers being tied to carriers for hot models, a la the iPhone with AT&T or the Palm Pre with Sprint. People for whom this matters, especially the kids, have figured out how to force the iPhone onto other networks. Among everyone else, few probably knew they even had a problem needing FCC attention.

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