A proposed rule published in the most recent edition of the Federal Register takes aim at Department of Defense (DOD) contractors with deficient business systems. The rule, which seeks to reduce "the risk of unallowable and unreasonable costs on Government contracts," would allow contracting officers to withhold a percentage of payments from contractors with deficiencies in specific business systems.

Oh, boy, it's that time of the month again, the Congressional Budget Office (CBO) has released its Monthly Budget Review (MBR) for December. Let's see, the government spent a little less than it did at this time last year, but it continued to take in less money, which, along with the deficits in October and November, created an approximately $390 billion budget deficit through the first quarter of fiscal year 2010. Overall, the MBR continues to paint a rather ugly picture of government finances.

Just before senators departed for the Christmas holiday, they wrapped up most of their pressing business for the year, including health care reform and an extension of the debt ceiling, but they failed to address the expiring estate tax. Because of the Senate's inaction, the estate tax effectively died on Jan. 1 and will stay dead until Jan. 1, 2011. That is until senators return from their winter break and resurrect the tax, which top tax writers on Capitol Hill are promising to do before March.

Yesterday, Justin Elliot at Talking Points Memo published an interesting piece on the never-ending saga that is the government's relationship with the company formerly known as Blackwater. Despite the scandals, investigations and indictments that have recently plagued Xe – and the resultant loss of a license to operate in Iraq and the cancellation of several security contracts overseas – the company continues to perform work for the State Department, the Central Intelligence Agency (CIA) and the Pentagon in Afghanistan and Iraq.