From chatting with some contractors and a sprinkling of media and government people in the last few weeks, it appears that a simple fact about the baseline state before a new "loophole-closing" law and regs is being overlooked or misunderstood.

At the current time, any fraudulent or similar contracting misbehavior against the government is already prohibited by statute and subject to civil and criminal penalties.

A new law and regs being discussed simply concern self-reporting. Some uninformed parties to the debate seem to say that it has been open season on the federal coffers overseas. They imply that contractors are currently free to cheat the government overseas.

Judging by known investigations and prosecutions of civil servants and military personnel, there's quite a bit the government needs to do to strengthen its own compliance with regs and statute in front-end contracting and oversight.

Come to think of it, is there any explicit self-reporting that civil servants are compelled to make, anywhere, when they make or learn of an administrative mistake in connection with a contracting action or oversight, or believe they may be guilty of negligent management or criminality?

If self-reporting for contractors is to be girded up in overseas contracting, or even reinforced in the United States, it would be useful to consider also what government employees need to do to disclose their possible wrongdoing and turn themselves in. Waiting for audit reports, Rep. Waxman hearings, or the FBI takes too long.

Although this whole thing just makes me shake my head in disgust, the important question isn't whether or not there's a loophole and, if so, who snuck it in. It isn't whether or not self-reporting is effective or whether the contractor, alone, or both the contractor and the contract manager should have to do it. The important questions are: What should and shouldn't be contracted out? Do we have the necessary resources (human and otherwise) to manage contracts effectively? Whom can we trust to do the job right and why? And how do we ensure transparency and accountability?

At the moment, our approach to contracting doesn't appear to be working so well, so let's try something different. Let's reduce the number of political appointees at the top of the bureaucracy and use their salaries to hire qualified people, based on merit, to run our government's day-to-day operations and to acquire enough manpower and talent to effectively oversee contracts where privatization actually makes sense.

We now have decades of experience to show that more appointees doesn't equal greater political responsiveness and oversight; it equals artificial layers of ineffective management and a breeding ground for corruption.

And for those who advocate running the public-sector like a business, ask yourselves the following: Would you staff up with extra layers of management in an attempt to create a more responsive and effective workforce? And if for some reason you would, would you hire friends who are only willing to stick around for a couple of years, or would you look for qualified and talented people hoping to build a career? Would you trust your staff to execute contracts without considering competitive bids? Would you neglect making training available regarding effective contract management? Would you outsource more functions than your staff is able to oversee? And perhaps what's most important, would you outsource your core competences?

As amazingly wrongheaded as this situation is, I suggest we stop worrying about whether a toothless rule has a loophole. Let's focus on fixing the problem.