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Trump Admin Targets Tech Contracts With Feds To Streamline Bloated Gov't
2025-06-01
373 words
2 mins read
Trump Admin Targets Tech Contracts With Feds To Streamline Bloated Gov’t
A new report cites an internal memo from the General Services Administration informing ‘Big Tech’ that the Trump administration is expanding its cost-cutting review of federal contractors beyond consulting firms to include now technology providers—specifically value-added resellers (VARs) like Dell and CDW.
The letter, obtained by The Wall Street Journal, was sent by Josh Gruenbaum, Commissioner of the GSA’s Federal Acquisition Service, to 10 tech firms in recent weeks, demanding an explanation of services and a breakdown of costs and markups, targeting inflated pricing practices and inefficiencies.
A new report cites an internal memo from the General Services Administration informing ‘Big Tech’ that the Trump administration is expanding its cost-cutting review of federal contractors beyond consulting firms to include now technology providers—specifically value-added resellers (VARs) like Dell and CDW.
The letter, obtained by The Wall Street Journal, was sent by Josh Gruenbaum, Commissioner of the GSA’s Federal Acquisition Service, to 10 tech firms in recent weeks, demanding an explanation of services and a breakdown of costs and markups, targeting inflated pricing practices and inefficiencies.
WSJ provided an update on contract cancellations since President Trump stepped into office:
11,297 contracts canceled across 60 agencies, saving $33 billion
2,809 consulting contracts terminated
The shift in scrutiny to streamline the bloated federal government, from consulting firms to big tech, comes as Booz Allen slashed up to 2,500 in June. The consulting firm specializes in government and defense consulting, generating a whopping 98% of its revenue from government-related work.
Goldman analysts recently downgraded Booz Allen from “Neutral” to “Sell,” noting medium-term revenue growth is expected to be flat as federal civilian spending comes under pressure and priorities shift within various federal agencies.
DOGE data shows that Booz Allen has had 68 contracts canceled, with 41 of these being contracts that had not been fully paid out, and the remainder having been fully paid. The 60 contracts account for over $600 million in deals.
The key takeaway is that the federal procurement process is in urgent need of reform. Looking ahead, the White House is expected to ask Congress next week to formally codify several cost-cutting measures from the Department of Government Efficiency (DOGE).
https://www.zerohedge.com/technology/trump-admin-targets-tech-contracts-feds-streamline-bloated-govt
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