As a conservative who believes in smart and limited government, I naturally support any policy which will protect taxpayers from waste, fraud, and abuse. The Department of Defense (DoD) currently has a policy for doling out defense contracts called “Lowest Price Technically Acceptable” (LPTA,) which is intended to provide the best military equipment at the lowest price; this policy is intended to serve taxpayers. However, the practical ramifications of this approach have been devastating to not only taxpayers, but to our own military and space programs.
Government should indeed pay the lowest price for paper clips, toilet seats, and other common goods. This is because ‘technically acceptable’ is easily defined for these items; they either work or they don’t.
When it comes to more complex equipment, like rocket systems, cold weather gear, firearms, and more, ‘technically acceptable’ is much more arbitrary. This policy of lowest price has the unintended effect of preventing government bureaucrats from choosing the most efficient long-term solution for our military, our space programs, and more. In short, a policy of lowest price ends up costing the taxpayers more money in the long term due to maintenance, replacement, and the like.
When the government announces a new contract, private companies rush to offer the lowest bid possible. Because there is such an emphasis on price, and not reliability or safety, bidders will often lowball contracts that they are unable to deliver on. When these companies cannot follow through, the bidding process must start over again, and billions of taxpayer dollars are wasted.
When companies do make good on their promise, the equipment will often be unreliable, or worse, unusable. Even if the ‘bargain’ equipment works initially, it will end up costing the government much more in the long-term.
While the cost to taxpayers is certainly an important factor, the efficiency (and lives) of American soldiers is enough reason to reexamine this policy. Bargain firearms contributed to the deaths of several American soldiers in a Taliban firefight, where their guns turned ‘white hot’ and jammed when they were under siege. Recently, the Marines’ cold-weather equipment failed during training exercises, leaving them freezing and unable to properly carry out their mission. This is unacceptable to happen even once to the greatest military force the world has ever known, let alone multiple times.
This policy is not limited simply to military applications, however. Cheap SpaceX rockets, which have often blown up on the launchpad, cost taxpayers millions for each explosive mistake. While their bids have certainly been the cheapest, initially, these bargain rockets end up failing to deliver both on price and reliability. Taxpayers, and our military and space programs, deserve better than this.
In the 114th Congress, Republican Senator Mark Rounds introduced bipartisan legislation to reform the DoD’s LPTA procurement process. Rounds’ commonsense legislation was designed to “provide our Armed Forces with high quality, advanced equipment while remaining a responsible steward of taxpayers’ dollars.” The legislation would prevent the government from using LPTA procurement policies for complex equipment, where bargain items are almost never the cheapest in the long-term.
We need smart government policies that encourage true competition, not lowball bidding wars between companies raking in millions of tax dollars but can’t deliver on their promises. Congress should bring the art of the deal to defense contracts, to the benefit of both our military and the American taxpayers. It’s not just the smart thing to do; it’s the right thing to do.