DOGE Has Consultant Cabal On The Run
By Theresa Payton | RealClearPolitics
Fresh from a run through federal agencies that saw budgets (and heads) exploding all over Washington, Elon Musk and the DOGE team have turned their Starlink satellite and aimed its powerful laser at the most inflated portion of the unofficial “shadow” bureaucracy: government consultants. This has the biggest names in the business – like Booz Allen Hamilton, Deloitte, and IBM – getting nervous, and with good reason.
I’ve seen the contracting game from all sides: working as the White House Chief Information Officer, doing major corporate consulting myself, and running my own cybersecurity firm. It’s long past time for this entire ecosystem to be shaken up and rearranged. Once again, DOGE is shining a light on how taxpayers are being taken for a ride. The new acting head of the General Services Administration, which is supposed to coordinate federal contracts, recently revealed that the top ten consulting firms are set to get more than $65 billion in taxpayer money in the coming years, and has put them on notice to account for it all by the end of this week. One of those companies, Booz Allen Hamilton, reportedly depends on federal contracts for 98% of its $11 billion revenue.
Booz Allen Hamilton, Wikimedia Commons
The same big guys (and it’s mostly guys – as the first woman White House CIO, I was often the only woman in the room) have hogged the trough for far too long. That doesn’t mean there’s no place for the major firms. But as the wife, daughter, and granddaughter of military veterans, I think of it like military strategy. BAH and firms at that level are like a navy’s capital ships – the major nuclear aircraft carriers. They’re important, but we can’t win wars with them alone. Special Forces win wars too – and there’s an entire world of smaller, more nimble consulting firms that can operate quickly and efficiently, much like Navy SEALS, to deliver what the government needs while saving taxpayers money.
Executives from BAH, Guidehouse, and other consultancies have reportedly rushed to meet with Trump administration officials to justify their massive paydays, an argument they’re cynically calling “defend the spend.” This week, DOGE has a once-in-a-generation chance to shake up the sclerotic contracting system to take advantage of all the different specialized teams the consulting world has to offer, instead of over-relying on unwieldy behemoths.
From a security perspective, Booz Allen’s reliance on the government for 98% of its business should stun everyone. That’s billions of dollars’ worth of important government information all housed on the same systems. A major hack at BAH could prove devastating. Systems become more resilient when you spread the load. Diversify the consultant pool further, and you lessen the risk of catastrophe if any one player is compromised.
While large firms can serve as steadying anchors, smaller businesses have the ability to move much faster. That means that instead of plotting expansion and personnel changes sometimes years in advance, we can start hiring as soon as we get a contract, and usually deliver results with a faster turnaround. The Pentagon showing greater interest in working with Anduril in addition to the big-name defense contractors shows this administration is willing to listen to different voices to advise on innovation. When a company like BAH has $11 billion in revenue (more than the GDP of several countries), failing to do their job – that is, failing to fulfill their mission for taxpayers – comes with less risk. Smaller businesses know they have less cushion to fall back on, and work harder to make every dollar count.
Making the big firms account for themselves is a great way to reform the consulting space, but there are separate actions the government can take that will make more companies of all sizes more competitive. The more red tape involved in the procurement process, the harder it is for smaller firms to compete. The big ones have armies of lawyers to cut through the regulatory jungle. But the answer is to make those lawyers less necessary by cutting red tape in the first place.
Josh Gruenbaum, the top official managing procurement at GSA, comes from the private sector and no doubt understands this. His office can set new rules to clear the field. All the justification for this anyone needs can already be found in the Small Business Act, whose enforcement mechanisms have been historically lacking.
The current system is a creaking relic – overloaded with giants, underpowered by waste. I can hear my Marine Corps grandfather and dad saying: “Improvise, adapt, and overcome.” The way we do that is by letting DOGE light a fire under the giants, recalibrate procurement, and empower smaller businesses to build the nimbler, more resilient, and more efficient consulting system a 21st-century world power truly needs.
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Theresa Payton is CEO of Fortalice Solutions. She was the first female White House chief information officer, serving under President George W. Bush.
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Header featured image (edited) credit: RealClearPolitics.
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