AMERICA's GOVERNANCE CRISIS

 

NewsX Senior Consulting Editor Vineet Malhotra sat down with Scot Faulkner who served as the Chief Administrative Officer for the U.S. House of Representatives and as Director of Personnel for 40th US President Ronald Raegan for a fireside chat on what the mood in South Asia is, vis a vis, the change in administration in the United States. Responding to a question on the heated discussion between Ukrainian President Volodymyr Zelenskyy, US President Donald Trump and Vice President JD Vance on Friday, Faulkner revealed that the last time something like this happened in public eye was back in 1619 when the defenestrations happened in Prague, which eventually started the 30-year-war. Excerpts:

Q: Do you think this (Zelenskyy-Trump-Vance exchange) was the first interaction of its sort ever to happen in the Oval Office or anywhere in the world?

A: I was doing some history research before this, anticipating the question. In 1619, in Prague, the defenestration of the Holy Roman Emperors, Catholic delegation. They were thrown out of a third-floor window and it started the 30-years-war. So that seems to be the last time there was a this high profile meltdown for a diplomatic mission. So, it’s been quite a while, and that one wasn’t on CNN. It’s just absolutely stunning. My phone started blowing up last night, and I have friends on both sides of the aisle. And you can imagine one side says it’s Zelenskyy’s fault. The other side says it’s Trump’s fault. And everyone’s sort of throwing eggs and rotten tomatoes at each other.

Q: Do you think it was about time that somebody called out Zelenskyy for what’s happening?

A: Well, that’s an interesting question because what they are saying is that a deal was cut and that this was only was supposed to been sort of like a protocol meeting in preparation for the signing of the document deal with mineral rights. And then they were going to go into a press conference, and Zelenskyy decided to up the ante and sort of reopen the negotiations on the fly. Some of the people are saying that Zelenskyy was so used to working with Biden and his national security staff, which to this day, is still probably the weakest and most incompetent in the American history. And he wasn’t ready to encounter the buzzsaw of Trump. And then to, as one person put it, with Trump and Vance, there was ‘bad cop, worse cop’ (instead of bad cop, good cop). And so, Zelenskyy probably lost his cool when he shouldn’t have. But both sides sort of up the ante. And it’s sad because only two people benefit from it: Russia – because they hope that they can retain all their ill-gotten gains of territory and maybe force Ukraine to never be a NATO (member). And then China that’s sitting there saying, well, if this happens on Ukraine, maybe we ought to test our waters, literally, our waters around Taiwan. So, it was not one of the better moments for American history or world history or for in the future, Ukraine.

Q: You gave me a lot of interesting insights into what governments do and what governments emote and project in order to run efficiently. And you spoke about the 3Ts. Could you share that philosophy and that idea with our audience as well.

A: When you start to think of governance, we’re not just talking about elections and who gets elected and who represents who. We’re talking about the actual operations and mechanics of how a government operates, how it serves its citizenry. And you kind of harken back to basically Rousseau in the 18th century about the social contract that, you know, we all came here either by bus or car because we don’t build. We don’t build our own cars. So we, we voluntarily, hire a car or buy a car. So we have a transactional contract with that manufacturer. The same thing goes in government. None of us are going to sit there and build the roads that drive that car. We’re willing to, through a toll or gas tax or something, delegate to government building the roads. We delegate to government, the police and the signage on those roads. And so the social contract for government at every level: from national to federal to local, is that the citizens that it serves willingly delegate and willingly pay for certain basic services that we’re not going to do ourselves. And so transaction is a very fundamental thing because government needs to be able to make the value proposition that we can do certain things better than individuals because of collective action and economies of scale.

Then we’re into trust: the second T. We trust that government is going to do the right thing. Just like we all had a lunch break, we assume that the food we ate was not going to kill us, give us food poisoning. So there’s a certain trust level that comes with that social contract. And then finally to establish that that trust is real and is actually justified, we have transparency. Public processes should be public; public documents should be public; public meetings should be public and public decisions should be public. And you put a little asterisk for we don’t need to know the nuclear codes or some secret weapon being built or who the spies are. But overall, public things should be public. What’s happened in America and this goes back 30+ years, is that both Republicans and Democrats are to blame. Those three Ts have been destroyed, and that’s what led to last year’s election where America’s faith in government, in that social contract has completely collapsed because governments have been lying to them. And we’re finding that over the years, we basically have a government filled with aging, egotistical, greedy and corrupt people who have been lining their pockets. And this is where the DOJ’s Department of Government Efficiency (DOGE) comes in. Peeling back the onion to see the waste, the fraud and abuse and the fact that we’re about to have the full files of the Epstein. We’re going to have the trial on PD. So we’re not only looking at corruption, we’re looking at perversion to a very sordid level. And so Americans today have little faith in government, little faith in the media that covers government, little faith in the academia that studies government and this is probably the worst crisis in governance in American history.

We had our Civil War, but that wasn’t about governance; it was about very fundamental issues on freedom and sectional competition. To this day, 77 percent of Americans are for what Musk is doing in terms of what we call draining the swamp and starting to expose all this waste. But the basics of governance that holds America together are right now in play, and we’ll see how it plays out.

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...Pants on Fire

Elvis and reality have left the building.

The hyper-partisan rants over the fiscal cliff were just the warm-up act for the triple play looming on the horizon. The triple issues of reining-in the debt limit, resolving the sequester, and extending the FY2013 Continuing Resolution seem to require triple the hyperbole.

Obama and Congressional Democrats are filling the air waves with victorious declarations about already reducing the federal deficit by $2.4 trillion. There are many creative tunes being played for this Conga Line.

The first is the timetable. Those who trumpet the $2.4 trillion only whisper “over the next ten years”. The trillion dollar number sounds large until you compare it to total federal spending of $44 trillion over the next ten years. That is a “whopping” 5.4% reduction in total spending. This assumes that the current decisions somehow bind four future Congresses and the next President.

Let’s look at the spending “cuts”. Obama and his supporters cite the Budget Control Act of 2010, which reinstates some of the spending targets from the 1985 Gramm-Rudman-Hollings Act. This is supposedly reducing various discretionary expenditures by $850 billion over the next ten years. Unfortunately, for the past 28 years, the spending targets of Gramm-Rudman-Hollings has been systematically ignored while the federal budget has tripled in size.

Obama supporters also assert that Congressional inaction and gridlock have resulted in Continuing Resolutions that leveled-off spending for a ten-year savings of $585 billion or $58.5 billion a year. This is creative bookkeeping at its best. Just one appropriation bill pushing for more than an inflationary increase in spending would erase these bogus budget savings.

Let’s take a moment to discuss inflation. Buried deep in the analytical tables of the Federal Budget is something called the “Current Services Analysis”. This is where zero-based budgets of the past went to die. “Current Services” is what budgeting should be, but never is. It is how much it would cost for the Federal Government to do exactly next year what it did the pervious year factoring in inflation escalators built into contracts and projects. This tracks to every person, project, program, office, vehicle, and building. The dirty little secret of Washington is that no one uses these numbers. The annual baseline offered by the Administration is well above “Current Services”. Both parties, while in the White House, play this game. Congress and interest groups then wail about budgets being cut when the Administration’s budget request is reduced even though these cuts never fully reduce the increase above “Current Services”. Thus spending ratchets higher no matter who is in charge.

This brings us to “Sequestration”. This $1.2 trillion over the next ten years poison pill of spending cuts was never designed to be real. Back in the summer of 2011, when raising the debt ceiling became a policy act instead of an administrative one, Congress and the Administration agreed to a “doomsday option” – the Sequester. The Sequester was designed to be so horrific that no one would ever want it to occur – thus forcing a real budget solution. Since everyone decided to avoid a real solution the Sequester looms large on the near horizon. Congress can always reverse itself and eliminate the Sequester with a “we were just kidding” floor vote. So trumpeting the Sequester as part of the $2.4 trillion over the next ten years reduction is also bending reality.

The other part of the victory dance is taking more money from Americans and giving it to the federal government. Believing that the federal government’s major problem is lack of our money is foundational to the Administration and Congressional Democrats. The recent tax increase generates $630 billion over the next ten years. In the past, any increase in federal receipts removed pressure to cut spending while increasing the urge to spend more.

The final assertion is that ripple effects of all these “savings” will reduce interest paid on the national debt $300 billion over the next ten years have as much to do with international money markets as they do on the total balance owed.

America braces for the next act in this most irresponsible fiscal fantasy.

FUBAR

[Overly complex ways to do simple things - by Rube Goldberg]

In the summer of 2011, Republicans and Democrats finally realized that the structural flaws in America’s fiscal management had to be addressed sooner rather than later. They created a fictional “fiscal cliff” that would deliver horrendously real consequences if all sides of the issue did not rise to the challenge. Instead of ushering in serious bi-partisan analysis and action, it accelerated and amplified the partisanship, exposing the fundamental dysfunctions of both political parties and of the Legislative and Executive Branches.

Just hours before the debacle of “Plan B” in the House, ABC-Australia reported on the realities and fantasies of the fiscal cliff. What follows is the transcript of their report.  The audio file can be heard at http://www.abc.net.au/news/2012-12-21/republicans-try-to-pass-plan-b-on-fiscal-cliff/4440368

EMILY BOURKE: To the United States now, where there's been furious last minute political wrangling over the so-called fiscal cliff and the mix of tax hikes and spending cuts.

As the clock ticks down towards the year-end deadline, Republicans have crafted a back-up plan in case a broader agreement can't be reached with the White House.

The Republican-dominated House of Representatives has passed a bill to cut domestic spending but after an abrupt recess, the Republicans decided to postpone a vote on tax breaks, having failed to get the numbers.

But it appears the Republican effort will be futile with Democrats in the Senate and the president vowing to block a Republican plan either way.

From Washington, Kim Landers reports.

KIM LANDERS: A few days ago a deal seemed possible.

President Barack Obama and House Republican speaker John Boehner continued to talk about how to avoid steep tax increases and spending cuts - the so-called fiscal cliff which is designed to reduce the federal deficit.

But now the two sides are further apart than ever before, openly trading political blows in the media all day.

JOHN BOEHNER: President Obama and Senate Democrats haven't done much of anything. Their plan B is just slow-walk us over the fiscal cliff and for weeks the White House said that if I moved on rates, that they would make substantial concessions on spending cuts and entitlement reforms. I did my part, they've done nothing.

KIM LANDERS: Jay Carney is the White House spokesman.

JAY CARNEY: But what we know about this exercise and we have seen this movie before is that when there was the opportunity for a compromise on something big and significant, the Republican leadership walked away and pursued something that was irrelevant to the rest of America.

KIM LANDERS: Late today, the Republican-dominated House of Representatives narrowly passed a bill to cut domestic spending.

But even before the votes were taken, the Democrat-dominated Senate was signalling that the measures would fail in the Upper House.

Dick Durbin is a Democratic senator from Illinois.

DICK DURBIN: Remember the closing scene in Thelma and Louise? Rather than face the reality of what lies ahead, they hit the gas. That's what we're hearing from speaker Boehner now, hit the gas and go over the cliff.

KIM LANDERS: Scot Faulkner is the former chief administrator of the US House of Representatives. He's highly doubtful that a deal can be struck before the end of the year.

SCOT FAULKNER: Both sides have dug themselves so deep into their trenches that you are not going to see a deal until after the first of the year and a new Congress comes in and the problem is that both sides really don't think the fiscal cliff is going to happen no matter how much they posture to the public and they both think the other side is going to give more ground and nobody is going to give more ground.

KIM LANDERS: Many government agencies are already preparing their employees for the impact of the looming budget cuts.

The US defence secretary Leon Panetta says uniformed military personnel will be exempt. But he's told civilian Pentagon employees that while no workers will face immediate unpaid leave after January the 1st, furloughs might ultimately be necessary.

Scot Faulkner explains why neither Republicans nor Democrats want to give ground.

SCOT FAULKNER: They're still thinking in terms of campaign mode, no-one is thinking in terms of governing.

KIM LANDERS: And can you suggest a reason why?

SCOT FAULKNER: They've not thought in terms of governing for over 12 years. You have, everybody is playing to their partisan audiences and in America you have very strong partisan newspapers, very strong partisan radio stations and cable television news stations and as long as their particular audience is cheering them on, no one is going to give ground and no one is going to shift from campaign mode into a governing mode.

KIM LANDERS: The impact of going over the so-called fiscal cliff has already been outlined.

According to the projections from the Congressional Budget Office, gross domestic product will drop by 0.5 per cent next year.

That contraction in the economy will cause unemployment to rise to 9.1 per cent in the fourth quarter of 2013.

But the agency estimates that after next year, economic growth will pick up and the labour market will strengthen with unemployment shrinking to 5.5 per cent by 2018.

SCOT FAULKNER: What will happen is that the first time that thing hits, one of those indicators hit recession, the recession zone, you will then have a scramble for everyone to first blame everyone else and then say okay, what can we do about this and so I think it's going to take an economic shock to finally get the political system working, even if it is only superficially.

KIM LANDERS: Scot Faulkner believes there is still time to strike a deal before the end of the year but even if that happens, he thinks it'll be a bandaid solution.

SCOT FAULKNER: At this point if they try to do anything, it's going to be either kick the can down the road hoping something else will happen or it will be very superficial. I mean they'll announce it as the coming of the new age but it'll be very superficial and not solve any of the fundamental issues facing America.

KIM LANDERS: The president is due to head to Hawaii for his Christmas holiday soon. It's unclear if the stalemate over the fiscal cliff is going to play havoc with those plans.

This is Kim Landers in Washington for The World Today.

Madness

To understand the current deadlock on the Fiscal Cliff one should read Barbara Tuchman’s masterpiece “The Guns of August”.

http://www.amazon.com/Guns-August-Pulitzer-Prize-Winning-Outbreak/dp/0345476093

In “The Guns of August” Tuchman vividly describes how institutionalized bias and determinism led to an avoidable world war and unnecessary carnage.  Her work offers lessons for the current political combatants, who are spending their time digging deeper trenches rather than finding common ground.

The Republican world view –

Republicans assumed that they would be welcoming the incoming Romney Administration and a new Republican majority in the U.S. Senate.  From this vantage point spending and taxes would be cut and entitlements would be reformed.  How they were going to get past January 1, 2013 to the promised land of the Romney era on January 20, 2013 was never discussed.  How the voters were supposed to support a new Republican era based upon no details was also left off the table.  What details there were included a tepid embrace of the “Ryan Plan”, cherry picking of the Bowles Simpson plan, some partisan swipes at Public Broadcasting, an overall sense that the current tax code was just fine as is, and an unwavering belief that there is not one penny of waste or inefficiency in the Defense Department.

Was it possible that Congressional Republicans hoped that anti-Obama barrages from the movie “2016”, Fox News, and conservative talk radio would get them over the finish line?  How would they have sorted things out had victory been theirs? 

The Democratic world view –

Democrats assumed that Obama would win by a landslide allowing them to retake the House of Representatives and surge to 60+ seats in the Senate.  They assumed Republicans would be so shell-shocked by their overwhelming defeat that there would be no effective opposition to whatever the Democrats wanted to do.  The Democrats firmly believe that the main problem with the federal government is that it does not have enough money.  They also believe that the tax code’s main deficiency is that it does not take enough money from people making over $250,000.  Coupled with this is a fundamental orthodoxy that the federal government is a well oiled efficient machine that only wastes money in the Defense Department, that the fiscal cliff is only real when discussing revenue, and that the economic and moral future of America depends on expanding government’s role.

Just like the English, French, Germans, and Russians in the years leading to World War I, the opposing political forces in Washington, DC, assume their facts are facts no matter the real facts. They also assume that the tactics they have used over the previous decades are sufficient to help them prevail in changing circumstances.  The devastation of August 1914 proved the madness of the political and military leadership among the great powers.  The gridlock and impending chaos of December 2012 is now proving the undoing of the political parties and eliminating the last shred of trust Americans hold for their elected officials. 

The Mayan Calendar predicts the end of their 13^th b'ak'tun on December 21, 2012.  America’s fiscal cliff calendar runs out on midnight December 31, 2012.  Only time will tell which date denotes the end of an era.

Raising Revenue Responsibly

This article was published on the History News Network

 http://hnn.us/articles/how-solve-fiscal-cliff-problem-responsibly

There are three legs to the stool of Federal Fiscal Solvency - Cut spending, entitlement reform, and revenue generation. Few of the Washington power players are realistically discussing any of these, but revenue has generated the most polarized rhetoric.

All our lives are impacted by the way our Federal Government raises the $2.9 trillion it needs to function. That is why it is important that any revenue element of a “Fiscal Cliff” deal is weighed not only for the amount, but for its “tax incidence”.

“Tax incidence” charts the various ways government amasses its revenue and how these ways impact individuals, industries, demographics, and “geographics”. Our current “progressive rate” income tax system and the strategic reform proposals of the flat tax, fair tax, and Value Added Tax (VAT) all generate significantly different impacts on our individual spending habits and our overall national economy.

Tax policy punishes or promotes economic activity either with intended or unintended consequences. Government tax policy has become social policy, resulting in an amazingly complex and voluminous tax code. The federal tax code is over 5.6 million words or 3,458 pages – seven times longer than the Bible, depending on the edition. Each page, sentence, phrase, and punctuation of this Tax Code, and its countless regulations, instructions, and manuals, determine winners and losers within the economy. These regulations are further subject to equally voluminous interpretation through administrative and judicial rulings.

There are nearly an infinite number of ways individuals, companies, and an array of other entities, can navigate this tax landscape. Lost in this morass is the original intent for many of these pathways and how they are supposed to positively guide economic behavior while raising desired revenue.

Democrats obsess over raising tax rates on the wealthy, and Republicans remain vague about “tax reform”. Thankfully, one person has conducted a detailed review of the Federal Tax Code and found $992 billion in possible tax saving/new revenue over the next ten years – without raising tax rates.

In July 2011, Senator Tom Coburn (R-OK) issued his “Back in Black” report. http://www.coburn.senate.gov/public/?p=deficit-reduction

“Back in Black” is a 624-page detailed, line by line, analysis of how the Federal Government can cut waste, achieve operational efficiency, and find the revenue needed to get out of debt.

Coburn’s final section (pages 558-624) addresses how decades of tax policy decisions have created a multitude of opportunities for special interests to avoid taxes, or obtain tax incentives and subsidies, while harming the general populace (pushing the tax burden onto others and driving up the debt).

Reviewing some of Senator Coburn’s examples of how our tax code runs amok is instructive and sobering. Coburn’s ideas represent the most economically neutral opportunities for new revenue and should be part of any strategic “Fiscal Cliff” agreement.

Subsidizing millionaires - Individuals with over a million dollars in income benefit from more than $7 billion in tax relief annually through the mortgage interest deduction. Under current law, homeowners can deduct the interest paid on home mortgages for primary residences and vacation homes loans of up to $1 million, resulting in lost federal revenue of nearly $88 billion. Even a yacht can be considered a second residence—as long as the luxury boat has a “sleeping, cooking, and toilet facility” and an individual lives in it for at least two weeks a year.

Subsidizing foreigner gamblers - Americans must pay taxes on their winnings at horse and dog tracks in the United States, but not foreigners. This deprives the Federal Government of $30 million over the next ten years.

Subsidizing Hollywood – In order to encourage Hollywood to produce feature films and television programs in the United States, entertainment companies may deduct up to $15 million in certain costs associated with the production of television episodes and movies where at least 75 percent of the compensation costs are for work performed on U.S. soil. Allowing Hollywood to benefit from this accelerated cost recovery results in federal revenue losses of at least $30 million a year.

Allowing fraud - Within the Additional Child Tax Credit (ACTC), individuals without a valid Social Security Number (SSN) claim $1.780 billion a year, or $17.8 billion over ten years. Congress has not provided the IRS with adequate authority to deny these fraudulent claimants.

No documented impact – The 1993 Government Performance and Results Act (GPRA) is supposed to hold every federal activity accountable for actually achieving intended results. GPRA is routinely ignored, not only for federal expenditures, but for tax expenditures. Two examples are Empowerment Zones (EZs) and Renewal Communities (RCs). EZs and RCs are federally designated poverty or distressed areas where businesses and local governments receive federal grants and tax incentives in exchange for locating and developing in these zones. Nearly $1.8 billion in grant incentives provided to EZs and RCs have been allocated since 1993. However, the Government Accountability Office (GAO) and the Inspector General at Department of Housing and Urban Development (HUD) have not found any tangible improvement in community outcomes.

Bailouts without end - The IRS has excluded major Troubled Asset Relief Program (TARP) recipients from certain tax obligations for potentially the next 20 years. These TARP recipients may avoid paying more than $90 billion combined in taxes because of this special tax treatment. This includes AIG, which has accumulated over $25.6 billion in carry-forwards and other tax-deferred assets; New GM, which will avoid as much as $45.4 billion in taxes because of the Treasury Department‘s exemptions; and Citi, which will use $23.2 billion in carry-forwards and other credit carryovers in just one year.

Malfeasance - The Internal Revenue Service found nearly 100,000 civilian federal employees were delinquent on their federal income taxes, owing over $1 billion in unpaid federal income taxes. The federal government has also failed to collect more than $62 billion in penalties owed by swindlers, criminals and others cited for violating federal laws and regulations and this amount has increased dramatically.

It is truly sad that none of these issues were discussed during the 2012 campaign. Republicans, in particular, could have avoided being branded as coddling millionaires. Each side is equally guilty of over politicizing these serious management and economic issues. The fact that Senator Coburn’s published report has remained in the policy wilderness for the last seventeen months is unconscionable.

Fiscal Flim Flam

The following appeared in the Washington Examiner

http://washingtonexaminer.com/congress-white-house-budget-trickery-now-backfiring/article/2514965

The only way the real fiscal cliff can be addressed is for everyone in Washington, D.C., to stop talking about the fake one. Here's the reality: The bomb is about to explode in the hands of its own maker. There is no disaster looming, only one created by the same Congress and the same president who are now voicing dire warnings about sequestration. The coming demise of federal programs is a manufactured problem, designed to meet the partisan needs of each side of the current debate.

Congress and the White House assert that $1.2 trillion must be cut from the federal budget over the next 10 years. This multiyear effort commences on Jan. 1, 2013, with $50 billion in cuts from the Defense Department and $70 billion from discretionary domestic programs. Everyone in Washington, D.C., including the pundits, has been creating increasingly apocalyptic visions of what will happen should these cuts occur.

It never had to be this way. There is currently $2 trillion in unexpended balances arrayed throughout the federal government for the current fiscal year. According to both the Office of Management and Budget and the Congressional Budget Office, $687 billion of these balances are completely unobligated.

Again, in 2012, the Government Accountability Office, or GAO, and the 73 department and agency inspector general offices identified more than $650 billion in annual, ongoing waste. The vast majority of these findings, and the actions recommended to address them, have never been acted upon by either the executive or legislative branches.

Finally, there's the federal government's legendary and perpetually unaddressed inefficiency. Large private corporations, like Walmart, have at most five layers of management between their front line service personnel and top executives. The federal government has upwards of 23 layers.

Given these three facts, why are our political leaders saying that federal spending cannot be cut, and that they must have more of our earnings and wealth to make ends meet?

The sequestration cuts are a bogeyman, specifically designed to inflict as much damage as possible on American citizens. For example, 53 percent of the sequestration cuts within the Department of Education are within the Elementary & Secondary Education Act programs -- funds sent to states to supplement the salaries and hiring of teachers. The sequestration cuts 60.9 percent of these funds. That is why so many politicians and pundits are predicting massive teacher layoffs. Meanwhile, the sequestration targets only 4 percent of the Department of Education's headquarters budget. The bureaucrats wouldn't be missed, but they are safe. The teachers will be missed, and they are ground zero for cuts.

What should have been a serious management exercise has become a race to see who can paint the worst scenario should budget talks fail. Democrats cite the collapse of social services and education, while Republicans predict massive layoffs of defense contractors and the hollowing out of our military. Both sides predict chaos in the economy leading to a second recession.

Democrats won the election, so they are now in the best position to use this crisis that both parties manufactured. They are setting off a stampede for more tax revenue that Congress will probably just spend away anyway. Had Republicans won, they would probably be calling for ideologically focused spending cuts (like public broadcasting) to prevent the ruin of the military.

Congress and the White House designed the sequestration to wreak destruction on government services and the economy as a way to create a false sense of urgency for a substantive budget solution. Their plan, if it was a plan, has backfired.

Back to the Future

What to do with the U.S. Postal Service?

The USPS just backed away from closing 600 rural post offices. This will probably be the first of many “blinks” over the decision to close 252 mail-processing centers and 3,700 post offices, as part of a plan to save some $6.5 billion a year. Rural interests and Members of Congress are howling about eradicating pieces of Americana. However, deepening deficits are eradicating tax dollars while consumer use patterns spell doom for “snail mail”.

Two solutions are never discussed.

One has existed since the mid-1990s. The USPS actually experimented with 24-7 automated Postal Service. It was so successful that one of these automated kiosks was installed in the Longworth House Office Building when I was Chief Administrative Officer. On October 19, 1995, Postmaster General Marvin Runyon and I cut the ribbon on this facility. Its equipment allowed customers to weigh and mail letters and parcels, as well as process registered & certified mail. This was not your parents’ stamp vending machine. So why not install these automated kiosks in the 600 rural post offices and others as well? I am sure this 18-year-old technology is even more efficient and cost-effective today. Postal employees could “ride circuit” and be available for that “human touch” on designated days and hours. At all other times, rural customers could do everything they need 24-7 in the local post offices they love.

Another solution is one that allowed Western Union to survive and thrive into the 21st Century. No one sends telegrams, but people still need to wire funds outside of the banking system. Western Union quickly realized its market niche while also realizing it did not need its own facilities. Enter the world of strategic partnering. Western Union partners with Walmart, Winn Dixie, Weis, and countless pharmacies and stores to provide their services – eliminating staffing and other fixed costs. Why isn’t the USPS co-locating their 24-7 service kiosks in a similar network of partner locations? Why couldn’t there be mailboxes at Walmart and other large stores? This simple solution would allow the USPS to expand service into new population areas without building new facilities.

The reason these “back to the future” options are not pursued is that few in government are creative and have the desire to fight the Postal Unions and other special interests to change with the times. Until there is a will the way will be ignored.

Ship of Fools

The Federal Government’s “ship of state” found its own way to mark the 100th Anniversary of the Titanic’s sinking.

April started with the bizarre antics of “bureaucrats gone wild” at the General Services Administration (GSA). This was soon eclipsed by the sordid details of the Secret Service and other special security units in Cartagena. Partisan bickering then trumped what had been bipartisan concerns as both sides spared over whether these rogue acts were the tip of the iceberg for the entire Executive Branch and if President Obama was the captain who steered the ship onto this iceberg of waste, fraud and abuse. The final day of the month provided a final bone chilling death to responsibility and accountability in these icy waters – the U.S. Senate announced it would not pass a budget for the third year in a row.

The sinking of America’s faith in the Federal Government was documented by the latest Pew Research Center survey. Only 33 percent had a favorable opinion. This is troubling on several fronts. It is a precipitous drop from nearly 74 percent in 2002. It is also wide spread, with only 27 percent of Independents being favorable and a measly 17 percent across the ideological board thinking the Federal government is careful with the public’s money.

The other epiphany from the Pew survey is that only the Federal Government has sunk under the waves of disrepute. Views of state and local remain relatively constant with favorable scores of 52 and 61 respectively.

This could be a clear case in favor of Federalism, localism, and the Tenth Amendment. It is also a clear case that there is something fundamentally wrong in Washington, DC. The cause of this disconnect goes far beyond partisanship. At its heart is how to make the workings of the Federal government accountable in a meaningful way. How can citizens break through the bureaucratic trenches to know what is really going on and do something about it?

One attempt at breeching Washington’s fortifications is the Digital Accountability and Transparency Act (DATA Act). This Act requires federal agencies to report spending information on a searchable Web platform. However, the operative term is report. It is a management maxim that the moment you stop what you are doing to report what you are doing the data degrades in both timeliness and accuracy. That is why corporations have invested in real-time information capture for decades. Corporations have built massive live databases to the magnitude of petabytes and exabytes to discover consumer trends, guide their supply and distribution chains, and track dollars down to the penny and the nanosecond.

The Federal Government wants to keep away from real time anything. Time lags are the allies of parsing, spinning, and obfuscating. Yet, the only way to finally and fully solve what ails the Federal Government is a requirement that every penny spent (minus clearly defined covert accounts) should be maintained in standardized live databases, complying with Generally Accepted Accounting Principles (GAAP), open the public, and searchable at all times.

This sounds like a quest for a fiscally accountable Holy Grail, but it can happen in the Federal Government, because it has happened.

In 1983, GSA Administrator Gerald Carmen wanted to institutionalize the operational integrity of the agency. His vehicle was to base the agency’s annual report on the SEC’s 10-K report, a document required from publicly held corporations. The GSA is the most financially complex agency in the federal government with its maze of reimbursable accounts, revolving funds, and capital funds overlaying massive account receivables and payables. The inventory of assets is also daunting, especially the evaluation and depreciation of all the non-Defense capital assets and inventories of the executive branch. There is also consolidating statements on each Cabinet Department and Agency and the National Defense Stockpile.

The GSA’s 10-K took a small GSA team less than four months to complete. I was part of that 10-K team. The report was unprecedented in providing a tangible example of how the real world could replace the fantasy world of federal accounting. The GSA’s Fiscal 1983 10-K was made public and was immediately ignored. No one wanted to see real accountability spread throughout the Executive branch – even one run by conservative Republicans under Ronald Reagan.

In 1995, as Chief Administrative Officer of the U.S. House of Representatives, I resurrected Carmen’s financial reporting crusade. In the early information age, an annual 10-K report could become a monthly or even a weekly release drawn from live financial databases commonly used in the private sector. By June 1996, it was done, thanks to an amazing team of CPAs and data management experts. It went live for 24 hours with CSPAN and other news outlets cheering its existence. Plans for a nonpartisan editorial board, ranging from Common Cause to Americans for Tax Reform, writing explanatory notes were underway. Republican leaders of the House charged into my office demanding it all be eradicated. Even conservative Republicans under Newt Gingrich felt this display of public information was “too public”.

Now in 2012, we have the DATA Act. It is a useful step in the right direction, but it falls far short of the disclosure revolution needed to refloat the federal ship of state. How many collisions with scandalous icebergs need to occur before a real solution is embraced?

GSA's Mad House

“It’s a mad house. A mad house!” [Charleton Heston, “Planet of the Apes” 1986]

The ongoing revelations of scandal at the General Services Administration (GSA) are now being equaled by looney ideas for solving the problem.

During the recent Senate hearings on the GSA, Senator Barbara Boxer (D-CA) suggested that “GSA’s newly minted acting administrator should assign 11 “special oversight officers” to work in each of its regions for a period of time to improve accountability”.

What was she thinking?

GSA’s Regional Administrators are direct reports to the GSA Administrator. They are all members of the Senior Executive Service (SES), which means they are (1) under an enforceable and detailed performance agreement, and (2) can be immediately removed should they not fulfill this performance agreement, or violate federal law.

Once again, politicians have found a way to address a government problem by NOT enforcing existing procedures and policies. They want to create yet another layer of bureaucracy!

If the GSA Administrator is not properly managing their direct reports, it is time to find someone who will. Even an Acting-Administrator (and GSA has had nineteen of them during its sixty-three year existence) should hold direct reports accountable for their actions and actually know what they are doing.

The eruption of scandal at the GSA is a symptom of a larger issue throughout the Federal government. Government is way too big and its operations are based on everything but rational management thinking. It is only a matter of time before another agency or program explodes onto the front pages with waste, fraud and abuse. There are no real incentives for doing anything rational. Yes, there are detailed laws, policies, and regulations, but these are rarely based on reasonable management practices, and few people in government really care anyway. Fundamental organizational revolution is the only viable and lasting solution.

Some say the GSA should go away. Maybe so. However, before taking such an action, why isn’t anyone checking on how things are done in the real world? There are thousands of large successful businesses that provide operational space, equipment, and supplies to their far flung units. Why aren’t the House and Senate panels holding a hearing with executives from H&R Block, Marriott, McDonalds, Wal-Mart, or any number of other private companies asking them how they provide space, equipment, and supplies? Are they centralized, regionalized, or localized? Where does procurement authority reside? What are their systems for accountability and planning?

The real world is constantly updating their approaches to serving their markets. Those companies that do not change with the times and consumer tastes vanish. Government never has to worry about vanishing, even when it is decades behind the times. There are ways to bring reality to government. Adding additional layers to already antiquated and dysfunction systems is not one of them.

FEDERAL BUDGET INFERNO

"Lasciate ogne speranza, voi ch'intrate"[Abandon all hope, ye who enter here]

- Dante’s Inferno

The battle of the budget is underway, made all the more intense by upcoming Presidential & Congressional Elections.

As usual, everyone is throwing around “scare figures” to protect turf, power, and special interests. Even President Obama is making sweeping assumptions about how Rep. Paul Ryan’s budget would, “if equally distributed” close parks, end student loans, and harm veterans.

The budget debate, played-out in endless the campaign debates, surround what programs should be saved or cut. Republicans always get tongue-tied on this topic. They make bold sweeping statements about government waste and inefficiency and then someone asks them to be specific. This is usually followed by silence or mumbled assertions about abolishing the EPA.

It is truly sad that, except for a few voices in this wilderness, no one takes the time to collect the facts that are already out there. The Government Accountability Office (GAO), and the 73 Inspector General offices embedded in Cabinet Departments and agencies, issue reports detailing waste fraud and abuse down to specific programs and accounts and with specific dollars attached. The Government Executive Magazine and watch dog groups regularly publish these findings. Why doesn’t anyone read this stuff?

One of my ongoing efforts at public awareness is to post some of the more salient items on my FACEBOOK page. Over just the last six months, the reports I posted totaled $487,687,000,000 of ANNUAL SAVINGS. This $487 billion in annual savings is just a sampling of the reports.

Congress and the White House have been at loggerheads since the summer of 2011 over how to cut less than this amount over TEN YEARS. Yet, fully documented by objective and government funded Inspector Generals and auditors, the path to cutting well over a half a trillion a year from the budget, without any negative impact on services, is there for anyone to see and use. The only requirement is a commitment to financial integrity, efficiency, and accountability.

Below are links from my FACEBOOK posts since October 2011.

GOVERNMENT-WIDE OPPORTUNITIES

· Government curbs improper payments -- but not enough http://www.govexec.com/oversight/2012/03/government-curbs-improper-payments-not-enough/41616/
· Baby steps for government bookkeeping http://www.govexec.com/oversight/2012/03/governments-bookkeeping-improving-only-slowly-panel-told/41355/
· Telework Takes Hold - Wired Workplace http://wiredworkplace.nextgov.com/2012/01/telework_takes_hold.php
· GOP senator's latest report on government waste pokes Congress http://www.govexec.com/oversight/2011/12/gop-senators-latest-report-on-government-waste-pokes-congress/35680/
· GAO coaches lawmakers on maximizing cross-agency performance http://www.govexec.com/oversight/2011/12/gao-coaches-lawmakers-on-maximizing-cross-agency-performance/35609/
· Expanded data transparency bill clears House panel http://www.nextgov.com/nextgov/ng_20111103_6907.php?oref=rss%3Fzone%3DNGtoday
· Here is an effort to reduce the federal workforce by 10%, but this can be far more aggressive via targeting positions of retirees. At GSA we reduced the agency from 36,000 to under 20,000 (44%) in three years through a comprehensive attrition program. I reduced my CAO staff from 1,200 to 620 (48%) in one year via reorganization, abolishing functions, and outsourcing. Panel considers bill to shrink federal workforce through attrition http://www.govexec.com/pay-benefits/2011/11/panel-considers-bill-to-shrink-federal-workforce-through-attrition/35314/
· IG council honors star performers http://www.govexec.com/oversight/2011/10/ig-council-honors-star-performers/35187/
· FEATURES: Excellence in Government http://www.govexec.com/magazine/features/2011/10/excellence-in-government/35060/
· http://www.federaltimes.com/article/20110514/ADOP06/105140304/

Department of Defense· Senators go after waste in wartime contracting http://www.govexec.com/contracting/2012/03/senators-go-after-waste-wartime-contracting/41358/
· It is too bad BRAC is not being used to deal with our 900+ overseas bases. At least 400 of them are useless and expensive. Those overseas bases are generating non-American jobs - bring those jobs home! Administration to request new round of base closures http://www.govexec.com/defense/2012/01/administration-request-new-round-base-closures/40979/
· http://www.govexec.com/defense/2011/06/grassley-gives-failing-marks-to-pentagon-inspector-general/34115/
· http://public.cq.com/docs/weeklyreport/weeklyreport-000004022899.html
· http://www.cato.org/publications/commentary/slash-federal-spending-gao-details-waste-inefficiency-duplication-again

Department of Energy· Energy Dept. offers prize to create mobile apps that already exist http://dailycaller.com/2012/04/05/energy-dept-offers-prize-to-create-mobile-apps-that-already-exist/

Department of Homeland Security· IG: Customs shelling out millions in workers’ comp http://www.govexec.com/pay-benefits/2012/04/ig-customs-shelling-out-millions-workers-comp/41745/
· Cannot believe that Homeland Security is going to throw away more taxpayer money on a failed "virtual border fence". Isn't $1 billion down the rat hole a sufficient learning experience?? DHS details contract for second try at Southwest virtual fence http://www.nextgov.com/nextgov/ng_20111209_5650.php?oref=rss%3Fzone%3DNGtoday
· USCIS mismanaged immigration processing project, auditors report http://www.nextgov.com/nextgov/ng_20111122_1400.php?oref=rss%3Fzone%3DNGtoday
· Auditors blast DHS' $1.5 billion border plan http://www.nextgov.com/nextgov/ng_20111107_7253.php?oref=rss%3Fzone%3DNGpopular
· TSA mum on missing deadline for 100 percent cargo screening http://www.nextgov.com/nextgov/ng_20111102_1709.php?oref=rss%3Fzone%3DNGtoday
· FEMA urged to increase accountability http://www.govexec.com/defense/2011/10/fema-urged-to-increase-accountability/35216/
Department of Justice
· GAO upends Justice's identity card project http://www.nextgov.com/nextgov/ng_20120316_6484.php?oref=rss

Environmental Protection Agency· EPA plagued with poor budgetary and workforce organization, GAO reports http://www.govexec.com/oversight/2011/10/epa-plagued-with-poor-budgetary-and-workforce-organization-gao-reports/35156/
· www.gao.gov/new.items/d11347.pdf

General Services Administration· GSA employee rewards program now also under scrutiny http://www.govexec.com/oversight/2012/04/gsa-employee-rewards-program-now-also-under-scrutiny/41690/
· http://www.freerepublic.com/focus/f-news/2871348/posts
· http://www.govexec.com/management/2012/04/lavish-conference-costs-top-gsa-officials-their-jobs/41651/

US Postal Service· Post Office aspires to provide private sector salaries without [private sector competence. Postal Service defends executive salaries as lawmaker looks to cap pay http://www.govexec.com/pay-benefits/2012/03/postal-service-defends-executive-salaries-lawmaker-looks-cap-pay/41442/

Federal Fiasco

BREAKING NEWS -
Conference with clowns and mind readers costs top GSA officials their jobs

By Charles S. Clark

Top officials of the General Services Administration left the agency on Monday as the GSA inspector general’s office readied a “scathing” report on wasteful spending at a Las Vegas training conference in 2010, The Washington Post reported Monday afternoon.

Martha Johnson submitted her resignation, and Public Buildings Service Commissioner Robert Peck and senior counselor Stephen Leeds were terminated. A fourth manager was put on administrative leave, according to the news report.

Organizers spent $835,000 for a conference for 300 employees held at a luxury hotel, the Post said, including $147,000 in airfare and lodging for six planning trips. The tally also included $3,200 for a mind reader; $6,300 on a commemorative coin set in velvet boxes and $75,000 on a training exercise to build a bicycle.

http://www.govexec.com/management/2012/04/lavish-conference-costs-top-gsa-officials-their-jobs/41651/?oref=top-storyy

Rebuilding America's Civic Culture

[Richard Dreyfuss' Remarks at TEDx]



You might know me as an actor, but I’m here today as an advocatefor a very particular kind of education that I believe has gone missing from our schools today. Those of us who are older know it as civics. But I’m talking about not just one single class that you take in high school, but a complete K-12 curriculum.


Why do schools need this curriculum? I believe that tomorrow’s leaders need to be able to do three things, and do them very well.

They need to engage in civil debate.

They need to be pre-partisan.

And they need to appreciate the revolutionary notions that this country was founded on.
Let’s start with civil debate. Imagine we’re in Philadelphia. It’s July, 1787, and the Constitutional Convention has been in full swing since May. It’s hot and humid, we’re wearing wool suits and powdered wigs and pantaloons with stockings. We’re probably pretty cranky.

Fifty-five delegates from the thirteen former colonies are—pretty much—all arguing with each other. We’ve been independent from Britain since 1776. We have a temporary government, but it’s not working very well. We have to figure out how to rule ourselves.

You have the rock star, George Washington. Loaded with charisma and gravitas. If I was casting George Washington for a film, I couldn’t cast him. No one is good enough; no one living today has enough star power. Washington was the first person to think of himself as an American, as opposed to a Brit. King George thought he was the greatest man in the world, because he had willingly given up power.

There’s Alexander Hamilton, Washington’s right-hand-man during the war. Hamilton was the only true genius in the group, a person whose ability to understand political power was immense. He knew that this country could only be great as a world power, a manufacturing and industrial power. Hamilton looked west and saw the continent stretching out before us. He knew the future lay west, not east back across the Atlantic.

Our third key player is thirty-four year old James Madison. Shy. Short. Nerdy. Bookish. Absolutely brilliant at politics. He drafted a good part of the constitution while waiting for the others to arrive. Madison took notes under the table throughout the convention, so we have a pretty good idea of what went down.

Everyone at the convention has a different idea for how to structure the new government. Some want to copy England’s system and make George Washington king. Some want to let each state rule itself. Some want three Presidents, to share the power. Three presidents! Many of these men couldn’t stand each other, and Washington was frequently called over to mediate among them.

But throughout their disagreements, they maintained civil, if sometimes heated, debate. They found common ground. Civil debate is uniquely American, this idea that everyone has a voice, and all voices are equal. We take freedom of speech for granted, but it was these men in their powdered wigs who designed our system.

Is this what you think of when you think of the founding fathers? These guys couldn’t stand each other. Some of them were at risk of hanging if they came home with a single, federal government instead of each state being independent. But they worked through their differences and eventually came up with our constitution. Washington later described it as “little short of a miracle.”

So that is the first key aspect of American leadership that we need to be teaching our kids: civil debate.

Next is the ability to be pre-partisan. What do I mean by that? That you value the country more than your party, that you value the good of the whole, even before the good of the state that elected you.

It’s a pretty tall order. Our democracy depends on this principle. That a citizen of Tennessee can morph into a citizen of the whole, make decisions for the whole and—in many cases—make decisions against Tennessee, that's a pretty tough thing. It’s a very high expectation that we have of our citizens.

But tomorrow’s leaders need to recognize that some issues should be accepted and agreed to by all Americans, regardless of our party. Like civil liberties, free speech and assembly, freedom of religion, and the other amendments in the Bill of Rights. So teaching kids how to be pre-partisan is key.

Debate teams are a great example of this skill in action, because you are have a 50/50 chance of having to defend a position you disagree with. Learning to make a case for the other side allows you to have a broader understanding of the issue.

The third aspect of American leadership that we need to teach is to appreciate the revolutionary.

What was revolutionary about democracy? First of all, it depends on citizens, you and I. You don’t need good, educated, engaged citizens when you have a king or a warlord running the country. But democracy depends on everyone playing their part. Not just voting, but being engaged in the process. Understanding and appreciating how revolutionary democracy is.

What is amazing about America is that we said:

If you can get here, you can rise. No guarantee. But we give you the opportunity to rise, to be mobile, to start again, to fail and start again, to fail and start again. You can move around, say what you want, do what you want.

We were, and still are, a political miracle. And I mean, a political miracle. Because the norm is so dark and bloody and so unfair. We offered fairness and we offered a legal system that said no one was above the law. And that was completely unheard of.

We can see revolutionary in the Preamble of our Constitution. Let’s take a look.

We, the people of the United States:

Think about that for a minute. Never in history had a document like this been written. This assumes the people are deciding their own fate. This assumes that there will be a United States. It assumes that the average person from Tennessee or Massachusetts could be educated enough to help lead the country.

Think about that for a minute. All other forms of government assume you have to be born into leadership, or that leadership is won through violence. But in America, anyone in this room with the inclination, education, and drive, can run for and win office, and lead.

In order to form a more perfect union… by that they meant, a better way to lead, a better form of government than having a king tell you what to do, or having lords born into leadership who will always be in office, no matter how poorly they lead or how corrupt they are.

This next section tells us what the government is supposed to do. Notice the words in bold.

Establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves…

These are all active verbs. That means that the constitution is a living document, always able to be modified and interpreted. That’s why we still elect people to office, still have a Supreme Court, still have a President, still make laws.

Now the next three words are the ones I want you to pay special attention to:

and our Posterity.

Who is posterity? Posterity is our kids and our grandchildren.

And that’s what I fear is in jeopardy right now. Why? Because we no longer teach kids how democracy works. We no longer teach civics, how to debate in a civil manner, how to reason through a problem. Just turn on any news channel and you’ll see what I mean. People have no idea how to reason through a problem, they just repeat sound bites over and over.

If we don’t teach kids how democracy works and why it’s so special, so revolutionary, who will run the country in 30 years? In 50 years? Who will have the skill set to run the country when your grandchildren grow up?

Kids need to learn how we share public space with those we disagree with. How do we debate issues with civility? How can we tell facts from spin? They also need to learn how to communicate clearly, so they can interact with public officials or speak at a community forum.

These three elements: civil debate, being pre-partisan, and appreciating the revolutionary are critical life skills. We don’t need everyone in these civics classes to get a 4.0… we simply need enough people to get 4.0s to eventually run the country.

So I started this organization, The Dreyfuss Initiative, to address this issue. We’ve partnered with The American Bar Association and Common Core to develop a K-12 curriculum that offers elements of civics in lessons for every grade level. And I’m asking you to do a couple of things tomorrow.

For kids who are watching, go online and sign our petition, asking that they teach you how America works.

For parents, ask your kid’s teacher tomorrow, is civics being taught? Is debate being taught? And, how can I help?

If you don’t have kids, call your local school and ask if you can volunteer to help with a debate team or to teach civics or American history.

No matter what your politics, whether you’re a republican, independent, green, democrat, or libertarian, this needs to matter to you.

Because America is still the best answer to the question humans have been asking for 13,000 years: how can we live together in peace and prosperity?

And we need to teach our kids how to run it.

Thank you for your attention.

Life after the Super Committee

My column regarding the Super Committee and what Congress can do now was published in the

New York Daily News on November 28, 2011.

http://www.nydailynews.com/opinion/fight-cut-debt-target-rampant-federal-waste-article-1.982076

The Congressional supercommittee’s failure to eliminate $1.2 trillion in federal debt has launched a new round of “blamestorming” as both Republicans and Democrats brace for the automatic cuts that are set to begin in 2013.

Some perspective and focus are desperately needed. For while indiscriminate cutting may be unwise, it is simply mythical to insist, as some do, that there isn’t room to massively reduce the size of government.

To the contrary, Washington’s fiscal garden is overgrown from decades of negligence. In recent decades political gamesmanship from across the political spectrum has led our federal government to decline into a weed-infested jungle. The way back to proper public horticulture is not new taxes, which would only fertilize the culture of waste and dysfunction. It is also not through heavy handed cuts, as a general herbicide would kill even the fruit bearing plants.

The first step is to identify the weeds. The Government Accountability Office and 73 inspector general offices are filled with investigators and accountants who identify waste, fraud and abuse. Their exhaustive reports track to specific programs, offices and contracts and treasury account numbers — and identify billions of dollars in cost-cutting opportunities.

Yet they are routinely ignored. As a result of this neglect, the amount of documented waste has remained at a consistent 20% of the federal appropriated budget since first complied by the Grace Commission in the 1980s.

President Obama’s proposed appropriated outlays for FY 2012 are $1.34 trillion. That means $268 billion a year is potential waste. Ten years of eradicating waste and sustaining cost avoidance would result in $2.68 trillion in savings, more than double the savings mandated in this summer’s debt deal.

Instead of partisan bickering, our elected officials should review these GAO/IG reports and listen to the staff who wrote them. They should conduct “sweat the details” management reviews. Waste is waste no matter which party’s flag flies over the executive branch.

Simultaneously, Congress should do something it has not done in years, whether under Republican or Democratic control: conduct aggressive oversight and link funding to functionality. Zero-based budgeting has existed since 1969. Sunset provisions have been built into legislation since the 1970s. The Government Performance and Results Act, which holds programs and agencies accountable for actually doing something of value, was enacted in 1993. Eliminating programs and offices based upon audit findings can happen if the will is there.

America’s overgrown fiscal garden is also filled with a bloated bureaucracy. Walmart, the world’s largest corporation, has just five layers of management between its checkout clerks and the CEO. There are 12 layers of managers between a park ranger and the Secretary of Interior. There are 21 layers of management between the person handling TRICARE medical benefits and the Secretary of Defense.

The entrenched interests of Washington, including turf-conscious Members of Congress, play a cynical game of eliminating frontline service personnel and services instead of wiping out the many layers of people whose sole purposes are attending useless meetings and writing unread reports.

The front line is where voters feel pain. When the cry goes up, federal officials say, “see — that is why we can’t touch this program.” It’s a fallacy.

During my time in Washington, we proved budget cutting is possible. At the General Services Administration, a reform team cross-walked Inspector General reports to dysfunctional programs and offices, applied private sector logic to eradicating management layers and linked attrition, retirements and a hiring freeze to reduce the GSA’s workforce from 34,000 to 20,000 in three years. This was a 41% reduction — yet system integrity, processing time, and operational efficiency skyrocketed.

As Chief Administrative Officer of the House of Representatives, we reduced 12 layers of managers down to two and reduced my operations staff by 47.5% in 15 months. Again, services improved along with efficiency.

In each case, real sustainable management reform required hard work, not just issuing news releases. Like a gardener who gets his or her hands dirty by handling individual plants and pulling weeds, legislative and executive branch officials need to do the mundane, but vital, tasks of actually understanding operations and management.
The reason they do not do this is that it is laborious, not glamorous. Our current political culture does not reward results. Maybe enough voters will finally change this culture in November 2012.

[Faulkner served in executive appointments during the Reagan administration and as chief administrative officer of the U.S. House of Representatives.]

Read more: http://www.nydailynews.com/opinion/fight-cut-debt-target-rampant-federal-waste-article-1.982076#ixzz283pmTzKg

Reshaping the Budget Battlefield

Finding government waste is like hunting cows. Actually eliminating government waste is another matter.

Governments, at all levels, are grappling with the dual tsunamis of an economic downturn colliding with budget busting entitlements and the fundamental inefficiencies of the public sector.

McKinsey & Company recently added their findings to the mountain of reports that identify government waste. According to McKinsey the federal government is wasting as much as $134 billion annually (about 15 percent of $1.21 trillion in discretionary spending).

McKinsey’s numbers are overly modest. Over the thirty years I have analyzed and eradicated public and private sector waste, I have found that the public sector wastes between 30-100 percent on a program by program basis. That means that even the best run programs, at any level of government, wastes double what McKinsey reports. That places the potential federal waste at well over $268 billion annually.

Posting numbers may raise awareness and urgency, but remains a publicity stunt unless real action takes place.

The first positive step is for elected officials to use the tools they already have. They can just say “no” to spending increases. They can refuse to reauthorize programs. They can demand real evidence of tangible and sustainable outcomes before appropriating one penny to a program. These laws are already on the books for the federal government and most state and local jurisdictions. It just requires the political backbone to take such actions.

Unfortunately, elected officials don’t want to anger special interests by eliminating favored programs, no matter how obsolete and ineffective. Instead, they opt for furloughs that hurt working people. Worse, they mandate across the board cuts that ironically reward waste and harm efficiency as the more wasteful programs can easily absorb these cuts while better run programs suffer.

The public should demand more. One way would be to create a public referendum on spending priorities, which would be very different from the failed California initiatives of May 2009. This better way was discussed in a previous column, “Building a Better Budget” [The Washington Times, February 5, 2007]. In that column, I explained how to give every taxpayer a hypothetical $100,000 to allocate within a federal or state budget as part of their annual tax returns. This linked taxes and spending in a powerful and empowering new way. It may take several years to refine this advisory process into a binding one. Either way, direct citizen input into government budgeting would fundamentally shift decision power away from special interests to the betterment of all.

Another possible solution is for federal and state governments to form 21st Century versions of the “Hoover Commission”. Both President Truman in 1947, and President Eisenhower in 1953, turned to former President Herbert Hoover to form commissions which strategically rethought government operations. These commissions recommended consolidation of functions, elimination of duplications, and realignment administrative processes throughout government . Just like an untended garden gets weed infested and overgrown to the choking point, so does government benefit from a “constant gardener”.

The McKinsey report offers another ray of hope when it asserts that, “Simply doing the same tasks in new ways, as it turns out, can be extremely powerful”. One of the greatest impediments to government efficiency is the bureaucratic culture. In this culture, the wrong things are rewarded: more spending, more personnel, more office space, and more activities. Many public officials, especially career managers, see their pathway to prestige and influence through amassing resources, not accomplishments.

Government, at all levels, can use this culture to its advantage. The bureaucracy resists change and efficiency because it fears loss. What if government allowed bureaucrats to reinvest their savings in their own enterprises? Instead of loss, efficiency would be viewed as gain or survival.

The exchange of waste for value has worked in a wide variety of settings. Every public employee can immediately list dozens of procedures and policies that do not make sense and drive them crazy. I have run “cost of quality” or “efficiency” workshops in dozens of federal and state agencies. In every case, the incentive structure was “you are empowered to eliminate these wastes” and more importantly, “you are authorized to keep and use every penny you save”.

Under the “waste for value” approach to reducing waste bureaucrats immediately grasp how their identifying where they are doing “stupid things stupidly” is not a witch hunt for blame, but a scavenger hunt for unleashing previously encumbered resources. This hunt for waste also opens their eyes to the powers of strategic thinking, collaboration, and prevention.

Another element to this scavenger hunt is prioritizing effort to results. An integral element for success is creating a four-quadrant “prioritization grid” where solutions are divided into easy to achieve, hard to achieve, high return on effort, and low return on effort. Recently, one federal operating unit not only realized that over a third of their operating budget was recoverable waste, but also that hundreds of improvement opportunities fell into the “easy to achieve-high return on effort” box. All those involved immediately and enthusiastically proceeded with eliminating their wasteful ways.

No one action will help government “thread the needle” through our current crisis, but a combination of the political will to “just say no”, engaging citizens in directly determining their fate, and redirecting bureaucratic energies are a start.