[Congressional Record (Bound Edition), Volume 159 (2013), Part 12]
[House]
[Page 17012]
[From the U.S. Government Publishing Office, www.gpo.gov]




                           THE PRICE IS WRONG

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 3, 2013, the Chair recognizes the gentlewoman from California 
(Ms. Speier) for 30 minutes.
  Ms. SPEIER. Madam Speaker, everyone has heard about ``The Price Is 
Right,'' but on C-SPAN tonight, we are going to play ``The Price Is 
Wrong.'' Before doing so, I want to put this in perspective.
  A number of years ago, we were all aghast as taxpayers--even here as 
Members of Congress--when we found out that in the Department of 
Defense we were spending $436 on a hammer, that we spent $7,600 on a 
coffee urn, and that--oh, yes--we spent $640 on a toilet seat. Talk 
about flushing money down a toilet--we were doing it--but that fleecing 
that we thought had ended has actually continued.
  Since 2010, the inspector general of the Department of Defense has 
found that we are spending more than $430 million over what we should 
be paying for spare parts--thousands of spare parts. So we are paying 
much more than the fair or reasonable price for these parts. What the 
military should do when it needs parts is go to what is called the 
Defense Logistics Agency, DLA--it is sort of like the defense hardware 
store--but sometimes they think it is cheaper and, maybe, faster if 
they go to a defense contractor and ask for those parts.
  These audits also showed that the certain parts we have in such 
volume will last us 100 years. That is like having spare parts like, 
let's say, horseshoes dating back to World War I, and they are sitting 
around the defense hardware store today--more than 100 years' worth of 
certain spare parts. You might think maybe this is a little 
complicated, but it is really not complicated. The auditors go to the 
Department of Defense databases, and they can tell immediately, with 
just a click, whether or not these spare parts are in stock and how 
much they will be charged for those spare parts.
  So let's play our very first game of ``The Price Is Wrong.''
  This is a ramp gate roller assembly. It is about the size of a 
quarter. This particular assembly sells for $7.71 in the defense 
hardware store. The auditors suggested--maybe because this is, in fact, 
for a Chinook helicopter--that it could be even a little bit more. What 
did the personnel within the Department of Defense pay for this little 
assembly? It wasn't $7.71. Was it perhaps $77.10? No, it wasn't $77.10. 
Was it $771? No, it wasn't $771. We paid for this $7.71 part $1,678.61.
  The price is wrong, and the Department of Defense has got to clean up 
its act.
  Let's move on to yet another game that we can play. It is called 
``That's Too Much.''
  I am going to show you another part. This is a bearing sleeve, and 
you are going to tell me whether or not you think the price is too 
much. At the local hardware store, this would sell for $6. Again, this 
is for a Chinook helicopter. The inspector general says maybe, for this 
sophisticated helicopter, it would cost $10 for this part. So, what did 
we pay for this part? Did we pay $86? No, we didn't pay $86. Did we pay 
$286? No, we didn't pay $286. We paid $2,286 for this little part. Now, 
we didn't just buy one part. We bought 573 of these parts, of this 
little bearing sleeve, and it cost us $1.3 million.
  All right. If you haven't enjoyed playing this game so far, we have 
one more game to play tonight. This game is the finale. It is called 
the ``Showcase Showdown.'' This is when we compare two packages and see 
which one costs more.
  Our first items here are two simple ramp gate roller assemblies. Now, 
which is more expensive--these two ramp gate roller assemblies or a 
trip to Paris, France, for two, including airfare and hotel for four 
nights? Which is more expensive? If you guessed the trip to Paris, 
France, you would be wrong because a trip to Paris, France, if you go 
on one of the local Web sites, would cost $2,681, and we paid--or, I 
should say, the Army paid--$3,357 for these two ramp gate roller 
assemblies.
  The Pentagon is playing games with taxpayer dollars, and let me tell 
you that this is just the tip of the iceberg. The worst part of this 
game is that it is rigged. The contractors always win, and the 
taxpayers always lose.
  The inspector general found that the Army overpaid one defense 
contractor $13 million but that the Pentagon only recovered $2.6 
million. Now get this: it is discovered that one defense contractor 
overcharged us $13 million for a number of parts, and then after it was 
exposed, they didn't even refund us what they should have. They only 
paid us back $2.6 million. It included paying twice the fair and 
reasonable price for kits and overpaying by $16,000 for a structural 
support that should have cost only $1,300.
  Now, this bearing sleeve that I just showed you that was over $2,200, 
let's put it in kind of simple terms.
  If we went into a local cafe and ordered the blue light special and 
the menu said it was $2,200, we would walk right out, and they would be 
laughed out of our community--but no, that doesn't happen in the 
military. As for that defense contractor who overcharged us and then 
didn't even pay us back what they had overcharged us--get this--the Air 
Force has just signed on the dotted line a contract with this defense 
contractor to do the following: to manage the supply chain. It is 
almost laughable that the defense contractor who ripped us off now has 
another contract to manage the supply chain.
  Those are all of the games we have for tonight. Thank you for 
playing. We will see you next time on ``The Price Is Wrong.''
  Madam Speaker, I yield back the balance of my time.

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