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“ROGUE SAN FRANCISCO PUBLIC UTILITIES COMMISSION EMPLOYEES!”

By: Moe Lane (Diary)  |  May 10th, 2011 at 06:00 PM  | 

RESIZE: AAA

…Hey, don’t blame me (or Ed Driscoll); I’m just quoting the San Francisco Chronicle. And, let me tell you: the scam that the Chronicle is… chronicling… is stellar, for its kind.

This is how it works: say you’re a company that wants to do business with the city of San Francisco.  But there’s a small problem; San Francisco is full of not only liberals, but very, very earnest liberals who want to be engaged in the political process.  This leads to a certain mindset* that thinks that it is just dandy to make government conform to the wishes of its populace in things like procurement and acceptable vendors – whether or not the wishes of the populace have any bearing on modern economic realities.  To give just one example: San Francisco insists that corporations doing business with it disclose if they were ever involved with slavery… which would be an impressive moral stance to take if it weren’t for the minor detail that they never seem to require that sort of thing from, say, the Democratic party.

But I digress.

So.  You’re a vendor who doesn’t want to rip up your tropical hardwood floors just so that you can get the paperclip contract for the local urban development office; but you would like to sell some paperclips – and the local urban development office would like to buy them from you.  What do you do?  Well, what you two do is you find yourself a middleman company who is in compliance with all those fiddly little regulations.  The urban development office signs a contract with the middleman to procure the paperclips.   The middleman buys the paperclips from you.  The middleman sells the paperclips to the urban development office.  You’re happy: the paperclips have been sold, you keep your hardwood floors, life is good.  The middleman is happy: they get a ‘modest’ – well, if you define a range from 10% to 150% as being ‘modest’ – [markup], life is good.  The urban development office is happy: they have their paperclips, they’ve struck a blow for social justice, and besides: it’s not like it’s their money, or anything.  So, really, everybody’s happy…

What’s that?

Oh, the current San Francisco budget deficit is $304 million; the debt is $1.3 billion in ‘non-voter approved debt,’ which is admittedly a somewhat ominous phrase.  But I’m sure that they’ll just tax a few millionaires and it’ll all be better later…

Moe Lane (crosspost)

*I believe that the military defines it neatly as Diligent/Stupid.

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  • JEM

    I think you mean ‘markup’, not ‘market’ in there.

    Oh, this has been going on for decades in San Francisco, and I’m sure other centers of urban rectitude, only in the past it was mainly in the name of women and minority set-asides.

    You’ll find a whole lot of contracting firms in California that are actually ‘owned’ by the spouses or acquaintances of the actual operators of the firm, just to make sure the right preference boxes can be checked on the RFPs.

  • http://moelane.com/ Moe Lane

    nt

  • billollib

    The process you mention here was one I dealt with all the time in DC when I was in the Army. There are all sorts of regulations in military procurement requiring that one try to buy from minority/women owned companies, small business,etc.

    So, there were a bunch of small woman and minority-owned companies who existed simply to act a middlemen. I’d find what I wanted to buy, tell the small woman/minority company what it was and where to buy it. They would then buy it and sell it to us — at a markup, of course.

    If we didn’t do it that way, we’d have to jump through all sorts of hoops to show that it was *impossible* to buy it from a woman/minority biz. The increase in cost was well worth the decrease in hassle and the ability to get what we needed in a timely manner.

  • rickbull

    “which would be an impressive moral stance to take if it weren?t for the minor detail that they never seem to require that sort of thing from, say, the Democratic party.”

    The stain to their fabric that will never completely wash out . . .

  • eddiethegeek

    If you want to sell to the Feds, say to the Navy or Marines, you often have to contract with a sham company owned by a Native American (fka Indian) Tribe! Yes, that’s right – it’s simply an unlegislated sales tax that companies must pay for the privilege of selling to the federal government, in an era where we’re running $4 billion per day deficits. Go figure!

    If the Press were doing its job, it would expose this stuff but instead they’re too busy providing cover for their ideologically-like-minded Democrats in power. Praise God there is now an alternative media!