Finally, Increased Government Spending We Can Feel Good About

Ara Trembly
Insurance Experts' Forum, October 26, 2009

Congress and the executive branch seem to find no end to ways to pick the pockets of taxpayers in the name of keeping their jobs, but every now and then they actually get it right in terms of spending. 

Specifically, I refer to a report from Reston, Va.-based consultant INPUT, forecasting that demand for vendor-furnished information security products and services by the U.S. federal government will increase from $7.9 billion in 2009 to $11.7 billion in 2014 at a compound annual growth rate (CAGR) of 8.1%.

This report identifies and analyzes the trends and drivers impacting this market’s growth, and identifies and sizes the following six major segments within the federal information security marketplace: security operations, planning, policy and program management, compliance, identity and access management, training, education and awareness, and infrastructure security.   

INPUT said it considers various factors that impact the size and direction of the market, including information security-specific legislation and regulations, the business needs of the government, and the technological landscape and the threat environment. Among the key driving forces named were President Obama’s alleged cyber review and “impending cyber coordinator,” a subject on which I have previously opined. Another, perhaps more potent driver cited is the heightened number of “attacks from resourceful and funded cyber enemies.” 

Isn’t it amazing how long it takes the federal government to pay attention to the obvious?  It’s not like attacks on government systems—some of which our own congressmen and senators have attributed to foreign governments—just started happening this week. This has been going on for years, and while I give the president little credit for anything, I do applaud his bringing the problem into public consciousness. 

Yes, more needs to be spent on securing our nation’s systems, and with the close interaction of government and private entities these days, that means the entire information infrastructure of our nation. That said, however, we are talking about politicians here, and among politicians, the mindset is to keep throwing money over the fence at a problem, regardless of how effectively those funds are used. 

This is an especially critical issue for health insurers, since our industry increasingly is a target for those same congresspeople and senators who wish to retain our votes by demonizing some monolith industry. Health insurers have enough to worry about with lawmakers’ attacks on their “obscene profits” and “insensitive hearts” without having to deal with security breaches that could compromise the privacy and the health of millions of insureds. 

It is in the best interests of our industry (and others) to make our voices heard, and to make sure that federal security reforms are well planned and carried out—rather than useless pork barrel projects. Let’s make certain that the new cyber-security czar (assuming one can be found) is smart and well-qualified, and let’s be doubly sure that we weigh in on the government’s plans and efforts in this direction. 

The very future of our industry is riding on our vigilance. 

Ara C. Trembly ( is the founder of Ara Trembly, The Tech Consultant, and a longtime observer of technology in insurance and financial services.

Readers are encouraged to respond to Ara using the “Add Your Comments” box below. He can also be reached at

The opinions posted in this blog do not necessarily reflect those of Insurance Networking News or SourceMedia.

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