Thursday, July 14, 2016 12:19 am
Cutting costs does not necessarily cut waste
An old rule of thumb among business owners holds that half of all the money they spend on advertising is wasted. The problem is no one knows which half. The question of waste in government spending is much easier for most taxpayers to answer: government “waste” is any money spent on any program or service they don’t need.
One of those taxpayers is Bruce Rauner. In a recent interview with Peoria Journal Star political reporter Chris Kaergard, Mr. Rauner listed the “big things and good things” achieved by his administration, one of which is having cut “more than $800 million out of wasteful spending inside state government.” Asked by Rich Miller of Capitol Fax for details, the governor’s office listed child care, healthcare, recycling programs, veterans housing, transportation funding for the disabled and state police funding, among other programs.
A lot of these purported cuts weren’t, but the governor’s carelessness with words and facts is not my subject here. Wasteful public spending is. Are these programs a waste of our money? The backers of these programs certainly don’t think so. The governor is just as certain that they are. The rest of us, unhappily, are in no position to know. As prudent citizens, we discount the views of each party to this dispute as interested, but we typically have no independent information to test them.
Are union members grasping and lazy and politicians low and corrupt? Some are, just as some businesspeople are cruel and dishonest. The problem is telling the good ones from the rest. As with people, so with programs. There is no question that state government wastes a lot of money – not nearly as much as people think, but a lot. In the case of social service programs, costs are carelessly monitored. Vendors cheat (those wily jobs-makers are always eager to grab a loose nickel) as do (less efficiently) some service recipients. The governor has concluded that work rules encoded in union contracts are wasteful of effort and money. Could be, indeed probably are, but it would be nice to know the facts.
Mr. Rauner has made some gestures toward efficiency as he understands it. He has brought in private-sector consultants wily in the ways of big-company management who lecture state agency staff in the mysteries of Six Sigma, as if the State of Illinois was just another conglomerate. Such interventions will do little good if they lead merely to the wrong things being done more efficiently.
“Waste” is a judgment about the outcome of an evaluation process, not a premise for reform. Certainly, some skepticism is appropriate. The establishment of do-gooder programs too often is a symbolic gesture to constituencies or conscience, a reflexive response to the cry of “We have to do something,” even when it is not yet clear how something can best be done. Once established, program administration becomes akin to a ritual intended to fend off evil whose efficacy is taken on faith. Typically a program set up and staffed to deliver a service includes administrative machinery to ensure that the services are delivered. Compliance with bureaucratic process is the test, not changes in the client’s world.
The governor could look to the example set by a former member of the Illinois Senate. President Obama, channeling Benjamin Franklin (“There is no Form of Government but what may be a Blessing to the People if well-administered”), has said that the relevant question is not whether government is too big or too small, but whether it works. His initiative to employ all the arts of the data-enabled social scientist to learn, for example, which teen pregnancy prevention programs actually prevent teen pregnancies has been called the most sweeping and potentially groundbreaking emphasis on rigorous program evaluation ever conducted by the federal government.
Rigorous program evaluation is not simple or cheap. Nor will it save mountains of money. The usual result is better outcomes, not lower costs; indeed in many cases, a rigorous evaluation will support spending more rather than less. Which is why I don’t expect to see it from this administration. Mr. Rauner is not a good-government governor as were such Republican forebears as Lowden, Ogilvie and Edgar. Unlike them, Mr. Rauner plainly believes that the best program is the one that spends the least, not which achieves the most for what is spent. If you believe in the principle that government should not be spending on social services or higher ed or culture or anything else that doesn’t advance the business interest, the question of program efficacy is moot. The least wasteful spending program in this view is the program that spends nothing at all.
Contact James Krohe Jr. at CaptBogue@outlook.com.