Inspectors general: all bark, no bite

It was the largest hack of federal data in history.

In June 2015 the Office of Personnel Management revealed the digital theft of sensitive personal information on as many as 21.5 million current and former federal employees and others.

Even more scandalous was that it didn't have to happen. The agency's inspector general, Patrick E. McFarland, had repeatedly warned of the cyber-vulnerability of OPM, essentially the government's human resources department. In response agency bureaucrats had misled, stonewalled and ultimately paid McFarland no heed, he said in Senate testimony. (He declined to comment further for this article.)

In this case, heads rolled eventually. The agency administrator resigned and another official retired. But the episode illustrates how inspectors general across the federal bureaucracy, no matter how dogged some are in identifying problems, are routinely ignored as toothless watchdogs with some bark and almost no bite. At a cost of more than $2.5 billion annually, inspectors general typically provide merely the appearance of accountability within Washington's permanent bureaucratic state.

That's not how things were supposed to be. Under the post-Watergate 1978 Inspectors General Act, the monitors were putatively established as quasi-independent avengers of waste, fraud and mismanagement. And on paper at least, they have some serious juice behind them: They are nominated and can be fired only by the president. And they aren't beholden just to their agency bosses but to Congress as well.

But the law never gave the IGs power to enforce their own recommendations, even as their numbers swelled from a dozen initially to 73. (Now even the watchdog Government Accountability Office is watched by its own watchdog.)

And over the years--especially lately--the ineffectiveness of IGs has been laid bare in partisan clashes and bitter internecine struggles over disclosure and privacy.

A recent report by the Senate Homeland Security and Governmental Affairs Committee laid out one of the biggest problems facing the IGs: The agencies they oversee can disregard them. And the consequences can be expensive.

The report counted more than 15,000 IG recommendations that were never implemented--some up to 15 years old-- and could have saved taxpayers up to $87 billion.

It found that:

• The Defense Department failed to act on 829 inspector general recommendations worth more than $33 billion in savings.

• The Department of Health and Human Services failed to act on 1,016 recommendations worth $23.1 billion in savings.

• The Department of Housing and Urban Development: 2,106 recommendations worth $5.3 billion.

• The Social Security Administration: 374 recommendations worth $5.4 billion.

• The Postal Service: 254 recommendations worth $7 billion.

• And the Department of Veterans Affairs failed to act on 1,078 recommendations worth more than $3.3 billion in savings.

Ignored recommendations are only one form of resistance IGs face from emboldened agencies that chafe at their scrutiny. Tensions grew during the Obama presidency as bureaucrats at several agencies sought to limit the long-established right of inspectors general to access certain documents.

The pushback can be traced back in part to the grisly 2009 murder of a 24-year-old Peace Corps volunteer from Atlanta, Kate Puzey. Her throat was slit in the African country of Benin after she accused a local employee of sexually abusing school children. Evidence suggested that local Peace Corps staff had indiscreetly revealed her role in the worker's firing.

In response Congress passed the Kate Puzey Peace Corps Volunteers Protection Act, which sought to shield such whistle-blowers. Agency officials, however, argued that it empowered them to withhold information from an IG investigation into sexual assault.

Meanwhile other Obama administration agencies were quietly mounting resistance to their inspectors general, increasingly refusing to release sensitive and confidential information to which IGs had long had access.

In 2010 the Federal Bureau of Investigation argued that the IGs' statutory right to "all records" did not include records the bureau wished to withhold.

The Justice Department formalized this as policy in 2015 when its Office of Legal Counsel issued a memorandum barring IGs from accessing documents such as grand jury records, wiretapped information and credit reports.

Following suit, departments ranging from the Environmental Protection Agency to the Postal Service began blocking their inspectors general from reviewing information, hamstringing their investigations.

This didn't sit well with some IGs, especially Justice Department inspector general Michael Horowitz. In October 2015 he complained in a Washington Post op-ed that he had been stonewalled by the FBI and cited new policies adopted in response to the Peace Corps affair which "prevented IG access to key records." He said the restrictions placed on his investigators were payback for "several critical reports by my office" of FBI procedure.

Horowitz followed that with a May 2016 letter to Senate leaders that said the new restrictions threatened "independent access to agency records," while also "hampering whistle-blowers' ability to bring us evidence of waste and misconduct."

Lawmakers were outraged. In December they passed and President Obama signed the Inspector General Empowerment Act, overturning the Justice Department memorandum.

"It is a waste of time and money to have agencies at war with their inspectors general over access to information," said Republican Sen. Check Grassley, one of the bill's sponsors. "The bureaucrats need to learn Congress intended for the law to mean exactly what it says."

Nevertheless, inspectors general still face other challenges from inside their own agencies.

But that kind of bickering pales next to the partisan warfare that can engulf inspectors general. Case in point: The congressional furor over the Internal Revenue Service's delays in granting tax-exempt status to Tea Party and other conservative groups before the 2012 election.

In a 2014 audit the Treasury Department's inspector general for tax administration, J. Russell George, recommended that the IRS better document the reasons politically active groups are chosen for review. The report said the IRS should "expeditiously resolve remaining political campaign intervention cases," some of which "have been in process for three years."

Congressional Democrats saw that as taking sides. Rep. Gerry Connolly of Virginia complained that the report was "fundamentally flawed" and called into question George's "independence, ethics, competence and quality control."

Not that the other side is happy with IGs either. In mid-January Horowitz of the Justice Department announced a broad investigation of the FBI's inquiry into Hillary Clinton's use of a private email server. This angered Republicans but pleased Democrats, who believe the FBI handling of the probe contributed to Clinton's defeat in the 2016 presidential election.

To Tom Fitton, president of conservative watchdog group Judicial Watch, this is an example of a politicized IG seeking to undermine the new president.

"There is corruption in the [IG] community, as evidenced by the investigation into Hillary's emails," Fitton said.

Few are happy with IGs, it seems. And things may get worse.

On Feb. 15 two Republican congressmen, Jason Chaffetz of Utah and Bob Goodlatte of Virginia, asked Horowitz's office to investigate leaks from intelligence officials about phone calls between Michael Flynn, the ousted national security adviser, and Russian Ambassador Sergey Kislyak.

The ranking Democrat on Chaffetz's House Oversight Committee, Elijah Cummings of Maryland, said the Republicans were "running interference" for the White House and looking to blame the leakers for Flynn's missteps.

For their part, inspectors general try to keep the focus on the work, not the politics.

Nick Pacifico of the Project on Government Oversight, a government watchdog, said critics might be more forgiving of inspectors general if they recognized the value of their diagnostic and green-eyeshade work even as they operate under conditions clearly not designed to make them as powerful as they might be.

"Everyone wants IGs who will come in and clean up government," Pacifico said. "That's naive."

Editorial on 03/05/2017

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