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Eye Opener: Federal Spending Saves D.C.

By Ed O'Keefe

Eye Opener

Happy Wednesday! The Post 200 hits newsstands and the Web today, our annual review of the Washington region's business climate. And (shocker!) it turns out that federal spending has once again saved the economy of our Federal City:

"The boom in government spending is attracting keen interest from big utilities, technology firms, start-ups and the lobby firms they employ. And it has foreign investors scouting real estate opportunities. Even Donald Trump is prowling for prospects; he recently bought a golf course here," reports The Post's Terri Rupar.

"About a third of Washington's economy either is the federal government or is highly dependent on it, according to the Center for Regional Analysis at George Mason University. The sudden boost in federal spending stands out in the economy's general slump."

Couple the increased federal spending with more federal hiring and "By the time President Obama's current term is over, his administration will have hired enough new federal employees to populate a good-size city," The Post's Joe Davidson writes today.

"His proposed budget for fiscal year 2010 projects that 'The Federal Government will hire several hundred thousand new civilian employees during the next four years,' in part because baby boomers are calling it quits.

"The administration acknowledges that it needs to fix an arduous federal hiring process. For those already on the payroll, the administration says it plans to enhance training, improve evaluation methods and 'put a healthy leadership pipeline in place' that identifies successors for critical positions."

Cabinet and Staff News: Ray LaHood honors the Merchant Marines who participated in the rescue of the passengers and crew of U.S. Airways Flight 1549 on the Hudson at 10 a.m. in New York. Robert Gates' most recent staff shakeup once again reveals he has little tolerance for missteps by the Pentagon’s civilian and military brass. Most of the military's top commanders are West Point graduates. The administration is debating the role of a proposed cyber czar. Eric Holder's recent comments on race prompt several plaintiffs to ask DOJ for help. Obama drops his NHTSA nominee and taps a chief of protocol at the State Department. Business interests consider Cass Sunstein an ally. CPO nominee Jeffrey D. Zients' nomination formally sent to the Senate. Senate Commerce will consider Aneesh Choprah's nomination to serve as CTO next Tuesday.

Today's Big Event: The Senate Rules Committee holds a hearing at 10 a.m. to investigate concerns with the military voting process. A recent Pew study found that 25 states do not give members of the military enough time to complete and return presidential election ballots, an obvious concerns.

In other news...

Alarm Sounded On Social Security: The financial health of the system has eroded more sharply in the past year than at any time since the mid-1990s, reports The Post's Amy Goldstein.

Obama Orders EPA to Take Lead in Bay Cleanup: The order he signed yesterday signals a far greater federal role in the Chesapeake Bay cleanup, instructing the EPA to coordinate efforts by several federal departments and work with state governments to reduce pollutants flowing into the bay, reports The Post's Ashley Halsey III.

EPA Chief: CO2 Danger Finding May Not 'Mean Regulation': The new position follows revelation of a White House document that warns the EPA of the wide-ranging -- and potentially economically harmful -- consequences of an agency finding last month that proposes declaring greenhouse gases are a danger to the public, reports the Wall Street Journal's Ian Talley.

Whistleblower: Gonzales Imposed Brutal Interrogation Tactics: ABC's Matthew Cole reports that the former White House counsel pressed counterterror officials to use brutal interrogation techniques on terror suspect Abu Zubaydah in 2002, even when those techniques hindered Zubaydah's cooperation, a former FBI agent who was present is expected to testify today before Congress.

DOJ Offers Tips On Spotting Stimulus-Related Fraud: The department’s Antitrust Division “Recovery Initiative” will train procurement officials, grant auditors, investigators and contractors on how to spot “the ‘red flags of collusion’ before stimulus awards are made and taxpayer money is unnecessarily wasted,” the Federal Times' Elise Castelli reports.

White House Says Law Only Answer for Gays in Military: Press Secretary Robert Gibbs says the president wants to do away with the "don't ask, don't tell" policy through legislation, according to the AP.

Bill Seeks to Boost Surviving Spouses' VA Benefits: The lower rate for Department of Veterans Affairs benefits paid to widows and widowers whose spouses died while on active military duty or as a result of service-connected injuries or illnesses has long outraged many military families and veterans groups, reports The Post's Steve Vogel.

IG: DOE Needs to Improve Contractor Oversight: Big problems with officials in the Energy Department's Office of River Protection, according to Katherine McIntire Peters of Gov Exec.

Army Chief to Shift New Vehicle Program Into High Gear: CongressDaily's Megan Scully reports that George Casey said Tuesday he hopes to begin fielding new manned ground vehicles in five to seven years, an ambitious schedule considering the service is only starting to design the fleet.

NTSB Finds Pilots Broke Rules Before Fatal Crash: "The co-pilot of doomed Continental Flight 3407 expressed shock and anxiety when she saw the windshield taking on ice, long considered a major safety hazard," reports The Post's Sholnn Freeman.

FDA Takes Issue With Cheerios Health Claims: The AP reports that the agency has scolded the company that makes the popular cereal for making inappropriate claims about the popular cereal's ability to lower cholesterol and treat heart disease.

Report Recommends Crackdown on Excessive Printing: The report, which is based on a survey of 380 federal employees, found that the government spends nearly $1.3 billion annually on printing, reports Gov Exec's Robert Brodsky.

By Ed O'Keefe  | May 13, 2009; 5:59 AM ET
Categories:  Eye Opener  
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