[Infowarrior] - 'Shadow Elite': Information Is Power And Who's Controlling Our Information?

[Richard Forno]

Gary Lyndaker
Posted: January 22, 2010 10:45 AM

'Shadow Elite': Information Is Power And Who's Controlling Our  
Information?

Janine Wedel's "Shadow Elite"--particularly her chapter on "U.S.  
Government, Inc."-- struck a familiar chord with me. She writes that  
our national and public interests risk being sold out because core  
government functions like running intelligence operations, controlling  
homeland security databases, and managing federal taxpayer monies  
doled out under the stimulus plans and bailouts are being outsourced  
to private contractors. Contracting is rampant: Today three-quarters  
of people working for the U.S. government are not government employees  
but private contractors. And it is no longer just printing and  
cleaning and food services that are being contracted out; it is the  
primary work of government.
Working for the last 17 years in information technology organizations  
for Missouri state government, I have seen a similarly alarming (and  
growing) trend on the state level. Over 25 years, as an information  
systems developer, manager, and administrator in both state and  
private organizations, I have increasingly come to the conclusion that  
we are putting our state's operations at risk and compromising the  
trust of the people of our state by outsourcing core government  
functions. And outsourcing does not come cheaply.

Let me explain from inside the world of IT. You might think that IT is  
one of those things like food services that can be easily spun off.  
Not so. When we talk about information systems and IT, we are not just  
speaking of geek technology. We are talking about the detailed mapping  
of an agency's operations into data and automated processes, which  
then embody and implement the functions of government. Information  
systems--encompassing software development, maintenance, and  
operations--hold the government's data, as well as the rules applied  
to that data and the business processes that make up government  
functions and services. These systems are also the source for most  
decision-making reports and analyses that guide decisions (other than  
those driven by politics or other power struggles). Almost always the  
analysts, designers, and programmers responsible for the software know  
the organization's business operations better than anyone else in the  
organization. When the IT function is outsourced, governments are put  
at risk. And so is the public's interest.

Here's why. In many of our agencies, at least one key software system  
was developed by an external organization with little substantial  
involvement from the state's IT staff. Once these systems are in  
place, there may be no one in the state's IT organization who knows  
the system well enough to maintain it. Thus I've witnessed, with  
alarm, such instances as these:

	• Missouri's Medicaid agency has one of the largest budgets in the  
state. Beginning more than two decades ago, the agency outsourced the  
development and maintenance of the Medicaid payment system. The system  
is maintained through a contract that has to be rebid periodically,  
putting its operation at risk each time the contractor changes.  
Moreover, the maintenance cost for this system is disguised from  
public view (because its cost is recorded as a "Program Service," not  
as an "IT Service") and I believe it is much more costly to taxpayers  
than doing this work in-house would be. In FY 2009 this cost taxpayers  
over $55 million--far more than was spent by any other agency on  
information systems.

	• Across the state, other key systems have been developed or  
configured by external companies and the dependence on those  
contractors periodically comes to the surface. After only about six  
years of operation of the state's accounting and human resources  
system, the contractor that was originally paid tens of millions of  
dollars announced that it was moving to a new technology and would no  
longer support our installed version.  It has taken threats and  
negotiations to maintain support by the contractor for the last few  
years. There is still no long-term solution--and this is the state  
accounting system!

	• After an unfavorable audit a few years ago, the Department of  
Health and Senior Services found itself in a crisis situation. The  
department's core public health system had been developed almost  
completely by contracted programmers and funding for most of those  
positions was cut off as a result of the audit. The agency had to  
scramble to create state IT positions so they could retain some of the  
development staff and their knowledge of the system. Had we lost those  
individuals, the Department would have struggled to manage the primary  
public health database in the state.

	• The Missouri Department of Revenue, which has been more "political"  
than most departments, has a history of contracting for the  
development of information systems, including vital tax systems. Some  
of their development contractors are no longer in business, leaving  
the agency with programs they can maintain only with difficulty. At  
least one contractor knew it had the state in a compromised position  
and made an exorbitant bid for a system upgrade. Another tax system is  
running on a version of server software that is more than a decade  
old. Others of their systems still require desktop software that is  
out of date and cannot be supported much longer. Overall, it is hard  
to justify the condition of the systems in this department and, of  
course, the public has no idea of this situation.

	• Most recently, the Office of Administration acquired a software  
system for tracking federal stimulus funds  distributed through the  
state. For a few months this system appeared to be the most  
politically visible program in the state. The software package was  
configured and installed by a local contractor and subcontractor. They  
did an excellent job considering the deadlines they had to meet. As in  
most outsourcing situations, however, there was no time, and no  
dedicated staff, to assure that in-house IT staff understood exactly  
how to maintain the system. For any critical change or failure in that  
system, the state has to rely on the original contractor and sub- 
contractor to make corrections in a timely manner. But, the right  
people may not be available when they are needed. Their first  
obligation is to their business, not to the government.
Amazingly, Missouri was one of only three states given an “A” in  
management of information by Governing Magazine in their 2008 state  
rankings, so one can imagine the situation in most other states.  
Missouri’s current IT leaders have indicated some intent to rely more  
on in-house IT staff and are making other attempts to improve control  
of IT systems. In addition, Missouri has often been fortunate to work  
with reliable IT contractors who employ local people, including some  
who have been state employees for part of their career, so the  
expertise stays “local” and some loyalty to the state may be  
preserved. But, if outsourcing expands or if different contractors are  
chosen, our current good fortune may end.

Tight budgets and political forces are driving Missouri and other  
state governments toward operating in an emergency mode and we respond  
by privatizing more government work. As illustrated by the examples  
given here, an increasing number of the people performing IT work are  
not state employees and therefore do not possess the unique knowledge  
of government functions and data and do not have the same priorities  
and loyalties. In the long run, this can't help but undermine the  
integrity and reliability of our government.

http://www.huffingtonpost.com/gary-lyndaker/shadow-elite-information_b_432889.html