Booz Allen’s Acquisition of EverWatch Will Exacerbate Lack of Competition in National Security Contracting

October 17, 2022 Press Release

Washington, D.C. — Today, government contractor Booz Allen Hamilton announced that it would close on its acquisition of EverWatch, its sole competitor for a National Security Agency IT contract, after a federal judge denied the Department of Justice’s request to issue a preliminary injunction that would have prevented them from doing so. In response, the American Economic Liberties Project released the following statement.

“At a time when nearly half of sensitive, tax-payer funded national security contracts already have zero competition, there is no reason to allow Booz Allen Hamilton to monopolize even more of the industry,” said Lucas Kunce, National Security Director of the American Economic Liberties Project. “The President, Congress, and the Pentagon all agree that a lack of competition in contracting presents clear national security risks. The unfortunate truth is that our government cannot make national security decisions as long as corporate judges and financiers are at the wheel. Until we fundamentally change our economic structure and values, where short term shareholder profits reign supreme, we will continue to fall behind our geopolitical competitors.”

The Department of Justice sued to stop the $440 million acquisition of EverWatch by Booz Allen Hamilton, the largest government IT contractor in the DC region. The case is still pending, however, Booz Allen closed on the acquisition after the judge in the case declined the DOJ’s request to issue a preliminary injunction that would have stopped them from doing so.

Consolidation in the defense sector has long been an issue — diminishing the US’s national security industrial and innovation bases during a key period of increasing geopolitical competition with competitors like China and Russia. Although not specific to the National Security Agency, the Government Accounting Office has found declining competition for defense-related contracts over the past decade.

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The American Economic Liberties Project works to ensure America’s system of commerce is structured to advance, rather than undermine, economic liberty, fair commerce, and a secure, inclusive democracy. Economic Liberties believes true economic liberty means entrepreneurs and businesses large and small succeed on the merits of their ideas and hard work; commerce empowers consumers, workers, farmers, and engineers instead of subjecting them to discrimination and abuse from financiers and monopolists; foreign trade arrangements support domestic security and democracy; and wealth is broadly distributed to support equitable political power.