Pentagon program costing taxpayers millions in inflated pricesBy Lauren Markoe and Seth Borenstein
Knight Ridder Newspapers
WASHINGTON -
The Pentagon paid $20 apiece for plastic ice cube trays that once cost it 85 cents. It paid a supplier more than $81 apiece for coffeemakers that it bought for years for just $29 from the manufacturer. That's because
instead of getting competitive bids or buying directly from manufacturers like it used to, the Pentagon is using middlemen who set their own prices. It's the equivalent of shopping for weekly groceries at a convenience store. -snip-
"I resent it as a taxpayer," said the firm's chief executive, who spoke on the condition of anonymity for fear of losing business.
"Before we'd sell it to them (the Defense Department) at a hell of a lot less money. I don't make/b] that money on it. Dietary (one of the prime vendors) is making money hands over fist. ... It makes no sense." A second manufacturing CEO, who also asked not to be identified for the same fear of losing what little business is left,
called it "three-card Monte economics." A third company president said the "prime vendor program is mismanaged; the costs are way, way too high."
http://www.realcities.com/mld/krwashington/news/nation/12974270.htm 
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