USAID/OIG Takes First Stab in Autopsy of Tillerson’s State/USAID Redesign

Posted: 1:45 am ET

 

In response to last year’s congressional request, USAID/OIG reviewed “USAID’s process in developing its reform plans and its compliance with congressional notification requirements.” We believe this is the first official accounting available on what transpired during Tillerson’s Redesign project, but primarily on the USAID side. We’re looking forward to State/OIG’s review of the project on its side.

The March 8, 2018 USAID/OIG report titled “USAID’s Redesign Efforts Have Shifted Over Time” was publicly posted on March 9, 2018. This report was originally marked “Sensitive But Unclassified (SBU)” and when publicly released, some of the appendices were redacted apparently at the assertion of the State Department and USAID that these be withheld from public view (see Appendix D, E and F. “USAID and the State Department have asserted that these appendixes should be withheld from public release in their entirety under exemption (b)(5) of the Freedom of Information Act, 5 U.S.C. 552(b)(5). OIG has marked this material SBU in accordance with 22 CFR 212.7(c)(2), which states that the originator of a record is best able to make a determination regarding whether information in that record should be withheld”).

USAID/OIG’s task was to determine (1) how USAID developed its redesign plans pursuant to Executive Order 13781, which were addressed by describing both the events and actions taken by USAID to develop its reform plans and the assessments of USAID’s actions by those involved in the process, and (2) whether USAID complied to date with fiscal year 2017 appropriation requirements.

USAID/OIG  interviewed 42 officials from across USAID. Interviewees included USAID employees from the Administrator’s Office, members of the Transformation Task Team, employees across every bureau and independent office, and overseas mission directors. The report says that these individuals were selected because of their knowledge of specific portions of the redesign process. There was also a survey that includes all 83 USAID mission directors worldwide (27 of whom responded). USAID/OIG also interviewed six senior officials from the State Department involved in the joint redesign process “to corroborate USAID testimony and portray a more balanced, objective sequence of events leading to the reform plan submissions.”

USAID/OIG’s conclusion:

“Results of our point-in-time review indicate good intentions by USAID as well as the State Department. However, USAID’s limited involvement in the design of the listening survey, uncertainty about redesign direction and end goals, and disagreement and limited transparency on decisions related to the consolidation of functions and services raise questions about what has been achieved thus far and what is deemed actionable. Given the concerns raised by USAID personnel, transparency—as well as compliance with congressional notification requirements—could prove challenging as redesign plans turn into actions.”

The details below are excerpted from the report:

Redesign process was resource-intensive and ad hoc

  • During this nearly 3-month process, USAID reported contributing around 100 employees (mostly senior officials) spanning 21 of its 24 bureaus and independent offices. Ten employees were detailed full-time to the effort. These participants were 48 percent Civil Service employees, 28 percent Foreign Service employees, 7 percent political appointees, and 5 percent contractors.
  • The State Department was reported to have brought around 200 people into the process.
  • According to work stream leaders, the State Department’s initial guidance for the teams was to “think big” with “no guardrails,” but the lack of boundaries and explicit goals hindered progress. The looming question of whether USAID would merge into the State Department not only distracted teams but further confused the direction of the redesign process.
  • The initial lack of direction was viewed as a hindrance by representatives from all work streams.
  • Participants described the joint redesign process as “ad hoc.” Interviewees from both the State Department and USAID noted instances when leaders of the joint process seemed unsure of the next steps. For example, a senior State Department official involved in coleading a work stream said there was not a lot of preparation, and the work streams did not know what the final products would be.

Joint disjointed efforts and disagreements

  • USAID shared its supplemental plan with the State Department days before the OMB deadline. A senior State Department official stated that the State Department was not pleased with the supplemental plan, noting that some of USAID’s proposals should have been developed through the joint process. The State Department asked USAID to remove some of its proposals relating to humanitarian assistance, foreign policy, and strategic international financing because State Department’s decisions regarding these areas had not been finalized. In the end, the supplemental plan USAID submitted to OMB contained 15 proposals (appendix E), while the version previously submitted to the State Department had 21. The six removed supplemental proposals are shown in appendix F. A senior USAID official noted, however, that USAID let OMB know what the filtered and unfiltered supplemental plan looked like.
  • Interviewees from the work streams and various leadership positions noted disagreement on decisions related to consolidation of USAID and State Department functions and services. Members from the work streams at all levels stated that the ESC—tasked to resolve disagreements within the work streams—rarely did so and was often unable to reach consensus on major issues such as the consolidation of IT and management services, or how to divide humanitarian assistance and funding decisions between the State Department and USAID.
  • Even after some decisions were thought to have been made, USAID officials reported instances when the State Department would revisit the decisions, forcing USAID to defend what was already considered resolved. This rethinking of decisions led a number of interviewees from both USAID and the State Department to wonder whether there were strong advocates for consolidation of services within the State Department.
  • Officials familiar with ESC [Executive Steering Committee] also noted that the committee lacked a formal process to resolve disagreements, and opinions were often split along State Department and USAID lines. As a result, some decisions on consolidation were left on hold and remain undecided.

USAID not part of listening survey decision

  • According to a top USAID official, the decision to administer a survey was made by the State Department alone, and USAID had little say as to whether it should participate or how the survey would be administered. USAID was not part of the contracting process with Insigniam and was brought in after most of the details were decided. The week following the issuance of OMB’s memorandum guidance, Insigniam engaged State Department and USAID officials to provide input into developing the listening survey questions but gave them less than 2 business days to provide feedback. A small group of senior USAID officials worked over the weekend to compile suggestions and submitted it by the requested deadline. Despite this effort, USAID officials did not feel their input was sufficiently incorporated into the survey. 

Questions about data integrity

  • Questions of data integrity were raised, including projected cost savings of $5 billion that would be realized with the proposed reforms—projections several USAID officials characterized as unrealistic. For example, one senior USAID official stated that the contractor responsible for compiling work stream data did not adequately understand USAID and State Department processes before applying assumptions.

 

  • The data and analysis behind the listening survey were also closely held. USAID officials reported requesting and being denied access to the complete, “raw” survey data, which is owned by the State Department. Some interviewees noted that without access to data, it would be difficult to interpret the magnitude of some of the issues identified in the listening survey.
  • This concern with data integrity was consistent throughout our interviews. For example, a senior USAID official stated that Deloitte—who was compiling data for work stream decision making—did not obtain an adequate understanding of processes before applying assumptions to them. Other work stream participants said that because data came from different systems in USAID and the State Department, it was difficult to accurately compare scenarios between agencies. According to several interviewees familiar with the data, the process had poor quality assurance. For example, documents were kept on a shared server with no version control. Moreover, interviewees noted that much of the decision-making information for the work streams was “experiential”—based on the backgrounds of people in the subgroup rather than hard data.
  • In addition, interviewees from both the State Department and USAID questioned Insigniam’s recommendation to move the State Department’s Bureau of Consular Affairs to the Department of Homeland Security—a recommendation some claimed was unlikely to have been based on data from the listening survey. This prompted a number of those involved in the reform process to question how survey input had been processed and the validity of the rest of Insigniam’s takeaways.

(NOTE: A source previously informed us that only 5-6 individuals have access to the raw data; and that the survey data is in a proprietary system run by Insigniam. Data collected paid for by taxpayer money is in a proprietary system. We were also told that if we want the data, we have to make an FOIA request to the Transformation Management Office, but our source doubts that State will just hand over the data).

Concerns about inclusiveness and transparency

  • A number of interviewees, including some mission directors and heads of bureaus and independent offices, felt the redesign process was not only exclusive, but also lacked transparency. According to senior USAID staff, OMB instructed the Agency to keep a close hold on the details of the redesign. While some mission directors noted that biweekly calls with bureau leadership, agency announcements, and direct outreach kept them informed of the redesign process as it occurred, field-based officials expressed dismay and disillusionment with what seemed to be a headquarters-focused process.

Mission closures and congressional notifications

  • [W]hile mission closings remain under consideration, some actions taken by USAID raised questions about compliance with notification requirements to Congress. To meet the congressional notification requirement, USAID must notify the Committees on Appropriations before closing a mission or reorganizing an office. The Consolidated Appropriations Act of 2017, Section 7034, requires congressional notification “prior to implementing any reorganization of the Department of State or the United States Agency for International Development, including any action taken pursuant to the March 31, 2017, Executive Order 13781.”
  • Specific mention of USAID’s offices in Albania, India, and Jamaica as candidates for the chopping block.

Non-notification and violation of FY2017 appropriations legislation

  • In the case of USAID/RDMA [Regional Development Mission for Asia], our analyses of USAID’s actions were less conclusive and raised questions about compliance with notification requirements to Congress. On August 17, 2017, the Acting Deputy Administrator requested from the Asia Bureau and USAID/RDMA a closure plan for the regional mission. The closure plan would outline the timing, funding, and staff reductions for a 2019 closure date. It was noted that the closure plan was for discussion purposes only, and USAID leadership would consult with the State Department to ensure that any future decisions would be in line with overall U.S. foreign assistance and foreign policy strategy.
  • [O]n August 18, 2017, the Agency removed six Foreign Service Officer Bangkok positions from a previously announced bid list. The Agency also informed the U.S. Embassy Bangkok, counterparts in the State Department’s East Asia/Pacific Bureau, and USAID leadership in the Bureaus of Democracy, Conflict, and Humanitarian Assistance and Global Health of a planned closure of USAID/RDMA’s activities. USAID leadership noted that they were given until the end of 2019 to complete the actual phaseout. Our best assessment is that the totality of the Agency’s actions relating to USAID/RDMA— without notifying Congress—violated the spirit of the FY 2017 appropriations legislation. 13

Aspirational savings of $5 to $10 Billion: not based on analysis, “came out of nowhere”

  • According to the joint plan, the proposed reforms would yield $5 billion in savings (link inserted) over a 5-year period; however, this amount did not factor the investment costs of $2.8 billion over that same period, which would result in net savings of $2.2 billion. These projections were characterized as unrealistic by several USAID officials. A senior USAID official involved in reviewing data stated that the $5 billion projection was unrealistic given the process used by the State Department and USAID to gather and analyze information. The official stated that the State Department’s reported aspirational savings of $10 billion was not based on analysis, but rather “came out of nowhere.”

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@StateDept Awards $2,105,663 Contract For Efficiency Task Force Support #Redesign

Posted: 12:58 am ET
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According to a July 2017 NYT report, Mr. Tillerson had hired Deloitte and Insigniam to help oversee the State Department’s reorganization.

If you click on Award ID GS00Q09BGD0018 displayed below via USAspending.gov that shows $2,105,663.00, it will take you to SAQMMA16F1155 dated June 30, 2017 with an obligated amount of $2,105,663.00. The contract awarded to Deloitte Consulting LLP includes the following details for Deloitte:

Product or Service Code | D318: IT AND TELECOM- INTEGRATED HARDWARE/SOFTWARE/SERVICES SOLUTIONS, PREDOMINANTLY SERVICES

Principal NAICS Code | 541512: COMPUTER SYSTEMS DESIGN SERVICES

Under contract information for SAQMMA16F1155, USASpending notes “THIS TASK ORDER PROVIDES SUPPORT FOR A DEPARTMENT OF STATE EFFICIENCY TASK FORCE. IGF::OT::IGF”

If we add this to the $1,086,250 for the organizational study that the State Department previously spent, the cost for Tillerson’s redesign is now $3,191,913.00.

As of this writing, we have not been able to locate the SAQMMA16F1155 documents on fedbiz.gov. The following clips are extracted from USAspending.gov where bare bones contract information is typically published. Click on the image for a larger view.

 

 

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@StateDept Says It’s “Unfortunate” That It Withholds Employee Survey Results From Public 😢 Hu-Hu!

Posted: 1:59 am ET
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Via govexec.com:

“Unfortunately, the results of the survey will not be available,” said Nicole Thompson of the department’s Office of Press Relations. That position comes in spite of the fact that a copy of the 110-page survey report from Insigniam, a consulting firm, was leaked to the Wall Street Journal, which published excerpts.

Hey, that’s the $10K/page report that the American taxpayers paid for but cannot read publicly. “Unfortunate” is an understatement. We also don’t know who owns the data collected during this study. Do you?

The contractor has asserted its copyright on the report — provided for under the FAR — in which case, “when claim to copyright is made the Contractor grants the Government, and others acting on its behalf, a license to the work.” Also that “The Government’s license includes the right to distribute copies of the work to the public for government purpose.” So in this case, by not making the report public, the State Department has decided that the American public does not have a right to see a report it paid for.

Folks, this is going to be the document that Mr. Tillerson will cite in reorganizing, no, excuse me, downsizing his own agency, the oldest executive agency in our history, and the public is not allowed to read it?  Holy moly guacamole! Help me! I can’t stop crying 😢 😢 😢 …

If Contractor is Allowed to Assert Copyright in a Work Produced Under a Government Contract, What Rights Does the Government Have?

Federal Acquisition Regulation (FAR) was established to codify uniform policies for acquisition of supplies and services by executive agencies. The following from the Frequently Asked Questions About Copyright Issues Affecting the U.S. Government  addresses the issue of copyright from an operations perspective:

A contractor’s assertion of copyright in a work produced under a DFARS contract does not provide any restrictions to the Government’s use of the work (see DFARS 227.7103-990 and 227.7203-991). In a FAR contract, if the contractor is permitted to assert copyright, the Government will acquire a license to the copyrighted work. The extent of the license may depend on the type of work created (see FAR 52.227-1492).

Under the FAR, when a contractor asserts copyright in a work first produced in the performance of a contract with a civilian agency or NASA, the contractor must place a copyright notice acknowledging the government sponsorship (including contract number) on the work when it is delivered to the Government, as well as when it is published or deposited for registration with the U.S. Copyright Office (see FAQ Section 4.8). If no copyright notice is placed on the work, the Government obtains unlimited rights in the work. Unlimited rights allow the Government to provide the work to another contractor and distribute the work to the public, including posting the work to a public web site. Otherwise, when claim to copyright is made the Contractor grants the Government, and others acting on its behalf, a license to the work.

The Government’s license is a nonexclusive, irrevocable, worldwide license to use, modify, reproduce, release, perform, display or disclose the work by or on behalf of the Government. The Government may use the work within the Government without restriction, and may release or disclose the work outside the Government and authorize persons to whom release or disclosure has been made to use, modify, reproduce, release, perform, display, or disclose the work on behalf of the government. The Government’s license includes the right to distribute copies of the work to the public for government purpose. While the contractor may assign its copyright in “scientific and technical articles based on or containing data first produced in the performance of a contract” to a publisher, the Government’s license rights attach to the articles upon creation and later assignment by the contractor to a publisher are subject to these rights. Under some FAR data rights clauses, if the work is a computer program, the right to release or disclose the computer program to the public is not included in the Government’s license. If there is any question as to the scope of the Government’s license, the Contracting Officer or your General Counsel should be consulted.

An example of a copyright statement, which includes a government license, for use with works created under contracts with civilian agencies and NASA is:

COPYRIGHT STATUS: This work, authored by ______________ employees, was funded in whole or in part by _________________ under U.S. Government contract _______________, and is, therefore, subject to the following license: The Government is granted for itself and others acting on its behalf a paid-up, nonexclusive, irrevocable worldwide license in this work to reproduce, prepare derivative works, distribute copies to the public, and perform publicly and display publicly, by or on behalf of the Government. All other rights are reserved by the copyright owner.

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Results of @StateDept $1M Organizational Study Reportedly Available via Intranet Today – Yay!

Posted: 3:28 am ET
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The results of the Insigniam survey that was commissioned by the State Department under Secretary Tillerson will reportedly be made available on the Intranet on Wednesday, July 5.  See WSJ’s Felicia Schwartz report below. We’re not sure if the State Department is releasing the full report or a summary report to employees on Wednesday, but be in a lookout for a 110-page report which supposedly includes feedback from 35,386 employees from State and USAID and 300 employee in-person or telephonic interviews.

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@StateDept Requires Insigniam to Provide Summary Report of Poignant Themes, Patterns, and Sentiments

Posted: 3:55 am ET
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On May 9, we blogged about the State Department’s Insigniam contract awarded in late April (see @StateDept’s $1,086,250 Organizational Study: Multiple Contractors Interviewed But Only 1 Offer?). Last Friday, May 19, the State Department finally posted a two-page JUSTIFICATION AND APPROVAL FOR OTHER THAN FULL AND OPEN COMPETITION FAR Part 6.302-2 for the contract.

The J&A requires Insigniam to “provide the U.S. Department of State with a summary report of the poignant themes, patterns, and sentiments of the people of the Department of State and USAID regarding both organizations, State’s and USAID’s ability to fulfill its mission, and proposals and suggestions for how to improve the organizations and how each does their work.”

It also says that the contractor “shall use listening sessions in the forms of verbal interviews and online surveys to gather data on aspects of the Department and USAID such as workforce culture, technologies used, and where the work gets done. The study shall be expedited, and shall proceed without preconceived notions of the optimal end state for a high performing agency, or its associated staffing level.”

The J&A also notes that “a synopsis of the proposed contract actions will not be posted as authorized by the exception stated in FAR 5.202(b), in that after consultation with the Administrator –Federal Procurement Policy and the Administrator-SBA, advance notice is determined to be inappropriate and unreasonable.”

Excerpt from the J&A:

Identification of the agency and the contracting activity:

In accordance with Federal Acquisition Regulation (FAR) 6.302-2 in accordance with 41 the authority of 41 U.S.C. 253(c)(2), the Office of Acquisition Management proposes to award a Sole Source Contract to INSIGNIAM LLC to assist the Department in complying with the requirements of The Office of Management and Budget (OMB) issued a memorandum on April 12, 2017, entitled “Comprehensive Plan for Reforming the Federal Government and Reducing the Federal Civilian Workforce,” (M-17-22

The period of Performance for this effort is less than one year and the estimated value will not exceed $850,000 plus certain international travel expenses for the post visit.

A description of the supplies or services required to meet the agency’s needs:

The Department of State, the first Cabinet level agency, has a presence in over 160 countries around the globe, staffed by political appointees and members of the Foreign Service, Civil Service, and Locally Engaged Staff serving domestically and abroad at over 200 Embassies and consulates. Together with the U.S. Agency for International Development (USAID), the Department seeks to fulfill its mission in an efficient and effective manner. With a combination of over 85,000 employees and locally engaged staff, the organizations are large and complex.

The Office of Management and Budget (OMB) issued a memorandum on April 12, 2017, entitled “Comprehensive Plan for Reforming the Federal Government and Reducing the Federal Civilian Workforce,” (M-17-22), which requires all agencies to, among other things, begin taking immediate actions to develop an agency reform plan. This plan, the first draft of which is due to OMB on June 30, requires proposals to identify how to improve the efficiency, effectiveness, and accountability of the agency, focusing on fundamental scoping questions and on improvements to existing business processes.

Before determining what improvements to make or what activities to eliminate, as required by OMB, data must be collected to understand the range of activities and functions currently performed throughout the Department. The Department aims to have this data collected from a wide swath of the Department community so that all groups of community members are represented. The collection and presentation of the data will inform the new Department leadership of the current structure, culture, and workflow.

The contractor shall provide the U.S. Department of State with a summary report of the poignant themes, patterns, and sentiments of the people of the Department of State and USAID regarding both organizations, State’s and USAID’s ability to fulfill its mission, and proposals and suggestions for how to improve the organizations and how each does their work. The contractor shall use listening sessions in the forms of verbal interviews and online surveys to gather data on aspects of the Department and USAID such as workforce culture, technologies used, and where the work gets done. The study shall be expedited, and shall proceed without preconceived notions of the optimal end state for a high performing agency, or its associated staffing level.

☒ Urgency
Exclusive Licensing Agreement
Brand-Name

☒ Other information to support a sole-source buy:

OMB has mandated the first draft of which is due to OMB on June 30, requires proposals to identify how to improve the efficiency, effectiveness, and accountability of the agency, focusing on fundamental scoping questions and on improvements to existing business processes. The complexity involved with required information gathering as well as the development and coordination of the report does not allow for sufficient time to solicit for the necessary services.

A synopsis of the proposed contract actions will not be posted as authorized by the exception stated in FAR 5.202(b), in that after consultation with the Administrator –Federal Procurement Policy and the Administrator-SBA, advance notice is determined to be inappropriate and unreasonable.

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@StateDept’s $1,086,250 Organizational Study: Multiple Contractors Interviewed But Only 1 Offer?

Posted: 1:54 am ET
Updated: May 12, 1:02 pm PT
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Via CBS News:

The State Department will be spending at least $1,086,250 for the “listening tour” that Secretary of State Rex Tillerson launched Wednesday morning.

The department has contracted Insigniam, a private consulting firm, to conduct the review in a project they are calling the “Department of State organizational study.” The State Department has not replied to requests for comment on the review’s price tag and their decision to use Insigniam to carry out this review.

Tillerson and the Insigniam co-founder Nathan Owen Rosenberg served on the Boy Scouts of America board together in 2011. The State Department has not replied to requests for comment on the review’s price tag and their decision to use Insigniam to carry out this review.

After Bloomberg broke the news on April 27 that Secretary Tillerson is seeking a 9% workforce cut and has hired the consulting company Insigniam to conduct a survey, we started looking for the contract awarded. We wanted to see the scope of work and the statement of work requirement included in this contract. We were able to find a $60M Professional Staffing Support Contract awarded on April 5, an Intent to Sole Source $34K Representational Furnishings on April 24  on FedBizOpps where federal business opportunities are typically posted, but not this one.

We understand that Insigniam was elected under a “sole source” contract. On May 1st, we emailed the State Department’s Bureau of Public Affairs for information on how and when this contract was awarded since we have not been able to find  the agency’s sole source justification for the job. As of this writing, the State Department has neither acknowledged nor responded to our inquiry.

Three contracts

We have since learned of three transactions (thanks Z!) issued to Insigniam LLC, a company based in Pennsylvania’s 2nd congressional district (PA02). The first contract SAQMMA17C0157 dated April 25, 2017 is valued at $850,000. The second contract SAQMMA17C0157 dated April 28, 2017 is valued at $236,250.  The third contract SAQMMA17C0157 is dated April 29, 2017 and does not have an obligated value. The third contract’s “Reason for Modification” is listed as “M: Other Administrative Action.”  All three contracts list May 30, 2017 as the “current” and “ultimate” completion date.

click on image to see the contracts via usaspending.gov

The funding for these contracts have been requested through the Bureau of Administration (State/A) but the Contracting Office is the State Department’s Acquisitions office (AQMMA). This is a definitive, firm fixed price contract.  The cost or pricing data is listed as “W: Not Obtained — Waived.”  The contract description says “Department of State Organizational Study.”

Multiple contractors interviewed but only 1 offer?

Under Competition Information, usaspending.gov lists this contract as “not competed”; the reason for the non-competition is listed as “Urgency.” This section also saysNumber of Offers Received: 1.”

The State Department apparently told CBS News that “they interviewed multiple contractors for the project before selecting Insigniam.”

“Of the proposals reviewed, Insigniam’s was the most cost-effective for the expertise, scope, and timeline needed, including its ability to survey and provide analysis of large organizations,” a State Department official told CBS News.  

So the State Department interviewed multiple contractors but those companies did not compete for this contract? And only one offer was received?

The company is listed on usaspending.gov as a partnership with 49 employees and an annual revenue of $12.7M.  The contracting officer determined it as a “small business”, “woman owned” and a “self-certified disadvantage business.” Under competition information, however, these contracts indicate “no set aside used” and “no preference used.”

The GSA confirmed to us that “the agency will dictate whether they are required to use GSA schedules or directly from a vendor. GSA has no say in how a customer orders needed materials or services.”

We are aware of only one previous organizational study conducted at the State Department (if there’s more, let us know!). There was  a study focused on the Foreign Service and was based on three management conferences held by the Department in 1965. It was conducted by Professor Chris Argyris of Yale University.  There were a few others through the years; we’ll try and see if we can find a good list to post here. 

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@StateDept “Listening Tour” Survey Leaks, So Here’s Your Million Dollar Word Cloud

Posted: 4:34 pm PT
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Zachary Fryer-Biggs, Senior Pentagon Reporter covering national security for Jane’s obtained a copy of the internal survey sent out at the  as part of Secretary Tillerson’s “listening tour” through Insigniam.

And then John Hudson, who used to be with  and now the Foreign Affairs Correspondent for  writes that the survey feels like Office Space, so he came up with all sorts of GIFs (must see, by the way). We thanked John for the GIFs; frankly, we don’t know where to store our laughing teardrops.

John Hudson also asked the State Department for comments, but the now famous Mark Stroh — who is just doing his job — and whose press shop now refuses to acknowledge or respond to inquiries from this blog — came back with an exclamation point!

What if you can’t come up with a word cloud?  To borrow what FBI Director Comey said the other day on teevee, “Lordy, that would be really bad.” So we’ve decided that we all deserve a million dollar word cloud. Here you go. You’re welcome!

 

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