In a sense, yes.

Contracts are definitely awarded to companies based on their political connections, and not necessarily merits. Look at the whole Halliburton/Cheney shitshow in Iraq for a recent example.

We're talking $40 billion worth of (cost-plus!!!) contracts awarded to a company that was widely viewed as incompetent by the soldiers on the ground, followed by the vice-president getting a position on the board of said company when he retired. This is after he got a $30 million golden parachute after leaving them in 2001.