The “Fiscal Cliff” – And the crystal ball says . . .

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A respected Government consultant asked, “What does your crystal ball say about federal construction spending, internal agency memos that say to put contracts on hold, and the fact that Uncle Sam has put a stop on civilian hires for the past 30 days?”

Fiscal Cliff

Let’s look at the facts:

There’s no crystal ball, but from experience, it won’t affect current projects that are already funded. And if a stop work order is issued on any current contract, that would be a de facto admission of liability, and responsibility to pay extended overhead costs plus profit.

If you can, avoid a “Work Suspension” because that would prevent profit from being added to your extended overhead costs.

The federal government is the largest land and resource holder with total assets of over $100 trillion, so the debt of $16 trillion can be handled a number of ways. The real problem is that while politicians are gifted with a well refined “ability to manipulate” public perceptions, they have not demonstrated an inclination to make “the business of government” fiscally responsible.

Consider that everything goes through cycles. Just like the weather, the financing of government responsibilities are somewhat predictable in the short term, but not so in the long-term. By historic reflection, there are cycles, and the cycles themselves are always changing.

Hiring freezes can only last so long because there is a natural attrition rate, retirements, deaths, etc. However, the functions of government rely on people that have to do what the Code of Federal Regulations (CFRs) requires of their respective agencies. Most people don’t realize that there are more than 450 federal government agencies that employ more than 2 million civilians in the Executive branch alone!

Your comments, questions, suggestions, thoughts and critiques are always welcome. Visit our blog for more. And if you are search for a “Success Blueprint” in the federal market, see what contractors, subcontractors, architects and engineers are saying about this one:
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