Partisan Procurement: Contracting with the United States Federal Government, 2003–2015

Abstract

The U.S. federal government spends huge sums buying goods and services from outside of the public sector. Given the sums involved, strategic government purchasing can have electoral consequences. In this article, we suggest that more politicized agencies show favoritism to businesses in key electoral constituencies and to firms connected to political parties. We evaluate these claims using new data on U.S. government contracts from 2003 to 2015. We find that executive departments, particularly more politicized department-wide offices, are the most likely to have contracts characterized by noncompetitive procedures and outcomes, indicating favoritism. Politically responsive agencies-but only those-give out more noncompetitive contracts in battleground states. We also observe greater turnover in firms receiving government contracts after a party change in the White House, but only in the more politicized agencies. We conclude that agency designs that limit appointee representation in procurement decisions reduce political favoritism.Verification Materials: The data and materials required to verify the computational reproducibility of the results, procedures, and analyses in this article are available on the American Journal of Political Science Dataverse within the Harvard Dataverse Network, at: https://doi.org/10.7910/DVN/4NEPI7. G overnments in developed countries like the United States spend over one-quarter of their budget buying goods and services from suppliers outside the public sector, with contracts typically set up between agencies and private firms (OECD 2017). The U.S. federal government spends $350 billion per year on procurement in the Department of Defense alone. This is greater than half the entire domestic discretionary budget in a given year, and it provides the president and his or her administration with a powerful political vehicle (Gitterman 2013). Although the Competition in Contracting Act (CICA) prescribes open competition for government contracts, this article explains that there are ways for agencies to circumvent the spirit of the law, which opens up avenues for politically motivated favoritism in procurement. And, indeed, there are clear signs of noncompetitive procedures and outcomes, with about 35% of federal contracts showing such features (Brunjes 2020).Politically motivated favoritism exists in situations where the procurer deliberately sets competition aside for electoral reasons, to cultivate relationships with connected firms, or in other ways to allow the incentives of the party in power to influence the procurement process. The opportunities to engage in favoritism are shaped by federal law and vary across agency contexts. Many

Ideology and Performance in Public Organizations

“…39 39 Our results comparing political alignment at the individual level within departments are complementary to Dahlström, Fazekas, and Lewis ( 2021 ), who showed that more politicized agencies use more non‐competitive procedures. …”

The Law: Government Transparency and Public Access

“…My dependent variables capture department‐level aggregate FOIA outcomes, and I use a department‐level aggregate measure of Politicization, which measures the ratio of political appointees (Schedule C, Non‐Career Senior Executive Service, and Executive Pay Schedule officials) to agency supervisors (Dahlström, Fazekas, and Lewis 2020; Lewis 2008). Importantly, there are multiple ways to capture politicization.…”

“…Politicization in this context refers to an increase in the number and penetration of appointees within an agency (Lewis 2008), which allows the presidential administration to exert greater personnel and policy influence (Dahlström, Fazekas, and Lewis 2020; Selin 2015). Political appointees help facilitate the president’s agenda and encourage responsiveness, urgency, and innovation subsequent to presidential directives (Bok 2003; Krause, Lewis, and Douglas 2006; Lewis 2008; Moe 1985; Potter 2020; Resh 2014).…”

“…Bureaucratic discretion can be lawfully utilized in ways partial to appointee preferences. In their analysis of the influence of politicization on federal government contracting behavior, Dahlström, Fazeksa, and Lewis (2020, 6) note that awareness of appointee attention to contracting decisions and a desire for career advancement could encourage career civil servants to “use their available discretion to satisfy agency leaders.” In addition to these factors, a desire to prevent direct encroachment into transparency policy implementation by appointees could also influence the use of discretion by career personnel. Political appointees, with direct connections to incumbent administrations and fewer tenure protections, arguably have greater incentives to scrutinize the release of information that can lead to negative publicity, resignations, and the uncovering of maladministration.…”

The Politicization Conversation: A Call to Better Define and Measure the Concept

“…Administrative politicization considers how political appointees influence administrative processes and decisions. For example, in an attempt to enhance responsiveness to politicians, agency leaders can add layers of review to regulatory decision-making, restrict information-flow, create in-and out-groups in decisionmaking, and adjust resource allocation to the comparative benefit of political allies (Ban and You 2019;Dahlström, Fazekas, and Lewis 2021;Doherty, Lewis, and Limbocker 2019b;Haeder and Yackee 2015;Öhberg, Christiansen, and Niklasson 2017;Palus and Yackee 2016;Wood and Lewis 2017). Simply, political appointees can operate as gatekeepers or agenda-setters.…”