Comeback America Page 18

  There is a lot at stake. We have more economic opportunities than ever, if we can recognize them. We also face more diverse threats to our national security than ever, and we can’t escape them. Some are external and some we’ve inflicted on ourselves. Arguably, the largest of these threats is our own fiscal irresponsibility.

  WE NEED A PLAN

  Despite the urgency of this agenda, despite our government’s size, importance, and complexity, it often ignores the basic rules of Management 101. Consider something as basic as a strategic plan. Most entities of any significant size have one. A company might make shoes for middle-income Americans, for example, and plan to shift its manufacturing to Asia and expand its sales to Europe—like a number of industries lately. It knows what it wants to do, lays out what it plans to do, and measures how well it succeeds.

  By contrast, the U.S. government does not really know what it wants to do. Believe it or not, our federal government, which is the largest single entity on Earth, has never had a strategic plan, and it’s been in business since 1789! This is, in part, because of the short-term nature of many critical positions and because our government is led by politicians and political appointees who typically stay in office only for two or three years. Washington takes in trillions and spends trillions more, but it does not have a comprehensive, integrated, forward-looking plan based on a set of principles and priorities and the outcomes it hopes to achieve. Nor does it have a way to measure its overall success.

  If you ask people in the executive branch for the government’s strategic plan, they’ll probably give you a copy of the federal budget. (Use both hands when accepting it.) But the federal budget is merely a one-year tax and spending schedule. It is not a strategic plan, which, among other things, would identify key trends, challenges, and opportunities and outline a range of proposed actions along with the results that they are intended to achieve.

  President Obama did the right thing when he issued a ten-year budget projection in his 2010 proposed budget rather than a five-year projection as President Bush had done. But, again, Obama’s document did not give us a set of performance objectives that we could use to measure the government’s success, or lack thereof. It’s one thing to set aside billions to spend on health care reform, for example. It’s another to tell us specifically how that spending will address our coverage gaps, control costs, reduce hospitalization and infection rates, and reverse obesity trends.

  Today we have the worst of both worlds. Our spending often spins out of control, yet we have only the haziest notions of what that spending is intended to achieve and whether it has worked at all. We commit direct federal spending, provide government guarantees, grant tax preferences, and create regulations to address issues like savings, housing, health care, education, infrastructure, and poverty in the hope that all those actions will make a difference, but without any evidence showing whether they do.

  The truth is, our main government tax and spending strategy involves little more than throwing mud at the wall and seeing what sticks. And we can’t really even tell what sticks. Without any standards of measurement, all definitions of “success” and “failure” devolve to the political arena. If your party enacted the new housing stimulus program, then you can make a dozen claims to support its success. But your opponents, at the same time, can point out as many claims of its failure. We ordinary taxpayers who footed the bill can only hope that something good came out of the exercise—but we can’t tell either. This is simply unacceptable and must change.

  We can no longer afford the luxury of this perpetual governmental confusion. Planning should become an established part of our legislative process as well. When Congress passes a major spending program or tax policy, its members should clearly define what objectives they are trying to achieve. The executive branch should translate those objectives into concrete outcomes that we can measure. If we decide to give tax preferences to increase our savings rate, what impact do those preferences actually have on the level and distribution of our overall savings rate? If we assist financial institutions, how well do those institutions pay us back by providing increased credit or otherwise helping to achieve a specific social purpose?

  Measuring success must be a key aspect of all major taxing and spending and of other government efforts as well. When our government spends money or gives tax breaks to support a program, we have to know how that program is doing to begin with, whether our tax dollars make things better or worse, and—this is very important—how that program’s performance compares to similar programs, both domestically and internationally.

  Whether you are a company or a country, you must have the right incentives, adequate transparency, and appropriate accountability to succeed. You really don’t know how well you are doing unless you have three key sets of information: (1) how you are performing based on desired goals and objectives, including outcomes; (2) whether your performance is improving or not; and (3) how your performance compares with that of similar entities.

  In many cases we already have the data we need to help us make good decisions. We know, for example, that our national savings rate is too low. The government has encouraged us to save by giving tax breaks to 401(k)s and IRAs, among other efforts. But as we have seen, our national savings rate continues to lag behind the rate of other major industrialized countries. This shows us that these incentives have not been working as intended and suggests that we need to explore alternatives. Perhaps, as I argued earlier in this book, we should consider putting in place a mandatory savings program as a supplement to a solvent, sustainable, and secure Social Security system.

  HOW TO START PLANNING

  How do we get the data we need to make good decisions about all of our government spending? It’s not hopeless. We can start by using President Obama’s first budget, for fiscal 2010, as a baseline—that is, as a new starting point in determining the programs we taxpayers are supporting and how much we are spending on each. In Washington you are allowed to use “baseline” as a verb, so I call this an exercise in re-baselining our government.

  This is not a new concept. It’s common for Washington to baseline its budget spending. It’s easy to see how much we’re spending on something this year compared with last year. But I’m talking about baselining what we do and the results we are achieving. The issue is what kind of results we are getting for the money we are investing. From that standard we can set clear, transparent objectives for our government spending programs and tax preferences and determine just as clearly whether our tax dollars are making a difference. If they are, great. If not, we need to fix them, consolidate them, make sure they all work together in coordination—or discontinue them.

  Among other things, we might need to consider the proper role for the federal government and whether a realignment of federal and state responsibilities might be in order. For example, the federal government could be responsible for the basic and essential health care safety net, including the Medicaid program, while states could be responsible for all education and transportation funding.

  We must ask basic questions about every major federal program and policy. Here’s a simple list of questions, for starters.

  When did we put the program or policy in place?

  What conditions existed at the time?

  Have those conditions changed?

  Have we modified the program or policy to reflect those changes?

  What are we trying to accomplish?

  How do we measure success based on desired outcomes?

  How well are we doing compared to set goals and related trends, and compared to comparable countries?

  Is the program or policy still a priority for today and tomorrow?

  Are other government programs or policies intended to accomplish the same thing?

  Are similar programs and policies working in a coordinated and integrated manner?

  How well are we using the experience of others—state and local governments, nonprofit agencies, other nations�
�to replicate successes and avoid common mistakes?

  Can we afford and sustain this program or policy in its present form?

  By asking questions like these, we could begin to do some real planning and enhance accountability in Washington. We could put ourselves in a position to ask more sophisticated questions. For example, given the resources available (a vital first consideration), where do we target our available spending so that our money makes the greatest difference?

  To help us transform the government to answer questions like these, we need our own version of the Hoover Commission. We could call it the Baseline Review Commission or the Government Transformation Commission. Its primary task would be not to reformulate the organization chart of government but to revitalize its ability to plan and execute affordable and sustainable programs and policies in the best interests of all Americans. It would be comprised of selected nongovernment officials with proven success in transforming organizations.

  If the strategy works, we could rationalize our governmental system as never before. President Obama, for example, has noted that he wants to make health care his top priority. In the system I’m suggesting, he would not simply set aside money in the budget for reforms. He would baseline our national health care performance according to a range of key metrics on coverage, cost, quality, personal responsibility, and other factors. He would set concrete objectives for health care and target taxpayer money and government actions to meet them. We Americans could then all see how well any reforms that are enacted into law are working and compare America’s results with those of other industrialized nations.

  At the same time, by putting health care at the top of our list, we would give other priorities less attention. This has to be the case, because as we all know by now, our government cannot indefinitely continue its practice of spending significantly more than it takes in. We must focus our efforts and our limited resources on the most important areas and be sure that our programs and policies are working.

  At the bottom of the priority list we might find items like federal subsidies to sugar farmers, which are scheduled to total $1.4 billion between 2008 and 2017. Can we afford to continue these subsidies, which have been in place since the New Deal? More important, should the federal government be subsidizing what I call the “white tobacco,” a leading contributor to our obesity epidemic? Let’s all spell out the answer together: N-O. And there are plenty of other subsidies and programs that deserve the same answer.

  A planning system would help make our government priorities and spending more transparent. This would improve government performance while also helping to better inform the public and reinvigorate our democracy.

  As part of this process, we need to work from a common set of metrics that would give us a fact-based state of the union on demand. The federal government produces a plethora of powerful statistics about its operations and American life, but it’s almost impossible for you and me to make sense of all the numbers. As comptroller general, beginning in 2003, I advocated that the government devise a set of key national indicators to plot our position and progress in areas such as the economy, the environment, health care, innovation, infrastructure, poverty, and security. We held a forum at the Government Accountability Office in partnership with the National Academy of Sciences. That effort spawned the State of the USA initiative. As I write this, a bipartisan effort to make this concept a reality and provide federal funding to create a related public-private partnership has begun in the U.S. Senate.

  Under this plan, the National Academies would lead the effort to devise the indicators; take the federal data and the best information from state, private, and international sources; and display the information on a public website. The idea is to give Americans unimpeachable data on the state and progress of the country and our society. As former White House chief of staff Kenneth M. Duberstein wrote in The New York Times: “Imagine everyone having at their fingertips answers to questions like: How many quality jobs are we adding to the American economy? How many more students are getting into college? How many more people are gaining access to affordable health insurance? Are we increasing economic growth along with savings and investment? Are we reducing our greenhouse gas emissions?”

  We all have issues that really matter to us, whether it’s poverty or women’s rights or economic growth. With reliable data to chart our progress in these areas, we could better understand the trends and what’s working (and what’s not). We citizens would be better informed and our elected representatives would be less able to pull the wool over our eyes. That’s a formula for better government and a healthy democracy.

  Determined citizens equipped with powerful information can accomplish a lot. Keep in mind that during the American Revolution, about one-third of the colonists supported the rebels, about one-third opposed them, and another third didn’t care who won. A relatively small percentage of those who supported the Revolution took up arms or otherwise directly supported the effort—and they changed the world.

  We twenty-first-century minutemen can do the same. Both the GAO and I continue to support establishing these key national indicators. After all, the GAO makes its living, in part, by auditing federal data and making sure all the numbers add up. The GAO’s list of high-risk areas was intended above all to shine a light on government’s performance. With light comes heat, and with heat comes action.

  During my tenure as head of the GAO, I challenged the agency to practice what we preached and to lead by example—two of my favorite phrases. I’m pleased to say that the agency rose to the challenge. The balance of this chapter will outline some of the things we did, the results we achieved, and why it matters.

  A MODEL FOR REFORM

  A successful government agency has to have a clear mission, top talent, good systems for doing its job, and effective ways to measure whether it is doing that job as well as it should. Its employees should be motivated to work efficiently. Their work product should be plainly written and comprehensible. After all, government workers are paid by the taxpayers, and the taxpayers should be able to figure out what their employees are doing for that money.

  Those government salaries are not so bad. It’s true that public employees focus more on the rewards of their missions than on their paychecks. And it’s true that people with excellent educations, highly marketable skills, and experience generally make more money in the private sector. But public employees do have some material advantages. Their jobs are more secure and their benefits more generous than most private workers enjoy, and economic cycles don’t cause many ripples. The public is becoming increasingly aware of and concerned about this disconnect from reality.

  That was true even in our recent severe recession. While private workers worried about pay cuts and layoffs, federal employees received across-the-board raises. As I write this, pending legislation would give federal employees pension credit for their unused sick leave. Once again, I have to wonder what planet Washington is on. Sick leave is supposed to be used when you’re sick!

  During my tenure, the GAO tried to preach sound values to the rest of the federal government. We did so as part of our essential mission: to serve as the investigative arm of Congress, auditing and evaluating government programs and activities. I came to office determined that we should, to repeat myself, lead by example and practice what we preached. We could make the GAO a model for how a federal agency should be run.

  My motives were not completely altruistic. When I was sworn in as the seventh comptroller general of the United States and head of the GAO in November 1998, I knew we had to do our job better. I had a strong leadership team and a number of highly educated and dedicated professionals in place, but our numbers were shrinking.

  The General Accounting Office (now the Government Accountability Office) was created in 1921 as part of the same law that created the Bureau of the Budget (now the Office of Management and Budget). The early GAO was focused on the review and approval of government vouchers before they
were paid (pre-auditing). It used a type of red tape literally to bundle various approved vouchers for payment. The agency grew to over 15,000 at the height of World War II. Its role evolved after World War II to focus on postauditing, When Elmer Staats was comptroller general (1966 to 1981), he began the GAO’s program evaluation function and expanded the GAO’s international activities. Chuck Bowsher, who succeeded Elmer and served as comptroller general from 1981 to 1996, focused on improving federal financial management. He also oversaw the GAO’s efforts during the savings and loan fiasco.

  During my tenure as comptroller general (1998 to 2008), I focused the GAO’s efforts on a range of oversight, insight, and foresight activities. We sought to capitalize on the agency’s competitive advantages and to lead by example in our efforts to transform the government and the accountability profession both domestically and internationally. I also championed federal fiscal responsibility and accountability as comptroller general.

  In the three years before I took office, the GAO’s total staff had been cut by nearly 40 percent. That happened after the Republicans had captured control of both houses of Congress for the first time in forty years. GOP leaders wanted to cut the size of government on principle, and focused in particular on the GAO, which was the biggest agency attached to the Congress and which they felt, rightly or wrongly, had become a tool of the Democratic leadership. Finally, the new Republican leaders questioned the value of some of the GAO’s work and felt that it had become too focused on its own agenda rather than on the needs and interests of the Congress. A survey of Republican House members showed that they favored cutting the agency even further. A number of senators felt the same way.