When Federal Contracts Turn Into Corporate Welfare

Boeing fv cc

This a good piece from The Huffington Post. It gets a lot of things right. Many executives at federal contracting firms are making a mint. Given that taxpayers are ultimately the ones paying for the services of the contractors, and since these contracts pretty much fall outside of normal market mechanisms, special scrutiny should be applied to all compensation.

The article falls unfortunately into the whole “income disparity” critique and waxes on about the values of a “democratic social contract.”

The income disparity issue is legitimate to some degree with companies which work within the crony, I mean public, sector. The wide eyed “democratic social contract” stuff we’ll just chalk up to the article being published at Huffpo.

(From The Huffington Post)

The progressive think tank Demos calculates in a new research report that private contractors have funneled up to $24 billion in federal funds into executive salaries. Yet, according to the analysis, the same system of contracted firms–from defense manufacturers to concession stands at national tourist sites–also employs hundreds of thousands of poverty-wage workers at the bottom.

Click here for the article.