JIM LEHRER: President Obama opened a new campaign today against government waste to go with his plan for massive new spending on the economy. NewsHour correspondent Kwame Holman has our lead story report.
KWAME HOLMAN: The president laid out plans to transform the way federal contracts are awarded and save $40 billion a year. He said the existing system is rife with abuse.
U.S. PRESIDENT BARACK OBAMA: Over the last eight years, government spending on contracts has doubled to over $500 billion. Far too often, the spending is plagued by massive cost overruns, outright fraud, and the absence of oversight and accountability.
We are spending money on things that we don't need, and we are paying more than we need to pay, and that's completely unacceptable.
KWAME HOLMAN: Mr. Obama was joined by administration officials and a bipartisan group of lawmakers. He said reforms are long overdue, and he ordered cabinet officials to develop new guidelines on contracting by the end of September.
He also called for an end to no-bid contracts in order to foster competition for government-paid work.
The president zeroed in on defense contracts, pointing to a Government Accountability Office review last year. It found cost overruns of $295 billion in 95 major projects.
BARACK OBAMA: If a system isn't ready to be developed, we shouldn't pour resources into it. And if a system is plagued by cost overruns, it should be reformed. No more excuses; no more delays. The days of giving defense contractors a blank check are over.
KWAME HOLMAN: The theme was reinforced at a separate event by Janet Napolitano, secretary of homeland security, and Tom Vilsack, the secretary of agriculture.
TOM VILSACK, secretary of agriculture: What the taxpayers need to know is that every single department of government has now been charged by the president to review in detail the nature of contracts that we've entered into in order to do what American families are doing. American families are sitting down today and trying to decide, "How do we save money? How do we eliminate unnecessary spending?" Their expectation is the government does the same.