Fiscal Summit and America’s Fiscal Challenges

Was it a parade of stars or a suicide mission?  Last week I attended a one-day wonk fest on the country’s long term fiscal outlook, the “2010 Fiscal Summit.”  It offered a rainy forecast, with possible thundershowers and occasional tornados.  It was organized by the Peter G. Peterson Foundation, which is dedicated to educating the public about the looming fiscal decisions our country needs to make.

Participants included political and news media rock stars:  Bill Clinton, Bob Rubin, Alan Greenspan, Paul Volcker, Alice Rivlin, Peter Orzag, Leslie Stahl, Bob Schieffer, Gwen Ifill, and of course Peter G. Peterson and David Walker (who heads the Foundation).

The Foundation has been trying to put a spotlight on the nation’s increasing fiscal challenges in recent years, with documentaries such as “IOUSA.” But in recent months, it has been promoting the need to come to some decisions.  The recent creation of President Obama’s Commission on Fiscal Responsibility and Reform (aka The Deficit Commission) – which is to offer solutions by the end of the year – created an opportunity to showcase the importance of the need to act soon (after the Fall election, of course).  The co-chairs of the commission – Erskine Bowles and Alan Simpson – participated along with several members of the commission.

Defining Success.  Simpson referred to the commission’s work as a “suicide mission” and that he held out hopes that “we may only move the ball a yard.”  However Bowles observed that success may well be at least educating the American people of the nature of the choices we face so they’ll put pressure on their elected officials to act.  He observed that “we need to develop citizen trust and confidence that this is not for political gain but to solve a problem.”  Both he and Simpson think that “we need a set of facts and figures that everyone agrees on, as a starting point.”  A low bar, but President Obama says he’ll support whatever the Commission agrees to!

Management Matters.  While most of the conversation centered on more taxes and fewer services, former President Clinton and OMB Director Orzag both offered a different path. Clinton said that we are facing the typical problems of every maturing society.  Once a society becomes successful, it becomes rigid and obsessed with security – economic, social, and defense – and these rigidities need to be overcome.

He observed that our current education, health care, financial, energy, defense, and tax systems are all rigid, highly inefficient delivery systems.  He says we have to dramatically change the way we deliver services in each of these systems.  He observed “Congress understands the problem but isn’t organized to deal with it.”  He thinks one option might be to create a super committee that over a two-year period puts in place the changes needed to deal with the long-term deficit problem.

Orzag focused specifically on the inefficiencies in the health care system, saying it is the biggest driver of the deficit.  He hopefully offered that the new legislation creates several institutions that will begin to shift the entire system from paying for the quantity of services to paying for the quality of services.  How these new institutions are stood up – the Medicare Advisory Board, the Payments Advisory Board, and the Innovation Center – will determine the success of these efforts.

Resources.  There are lots of places trying to market the facts and figures, and some solutions, but they don’t seem to be getting traction among the general public:

Next Steps. The Summit ended with a concrete step towards creating grassroots political attention (beyond the Tea Party) with the announcement of a simultaneous 20-city citizen dialogue on ways to fix long term fiscal challenges. The goal is to create “a shared sense of urgency,” noted Walker.

Maybe you’ll be one of the lucky ones selected to participate in one of these town meetings on June 26th (the Saturday before the 4th of July weekend!).  And in the meanwhile, the Deficit Commission plans monthly meetings through the end of the year.

“Desperately Seeking a Watchdog”

Today, in an editorial, the New York Times called for a presidentially appointed, Senate-confirmed leader of the Government Accountability Office (GAO).   Noting that the interim Comptroller General, Gene Dodaro “has served ably,” the Times editorial concludes that “without a presidentially appointed and Senate-confirmed leader, the agency lacks the power and validation to pursue its mission to the fullest.   Mr. Obama can choose form the names he has been given, or request more.  The important thing is to keep the process moving.   Public interest in Washington is already high enough.  For true accountability, the government needs a strong GAO.”

But will it work?

The Congress has passed and the President has signed the new health care reform legislation.  But, will it work?

This is the question that The Brookings Institution’s R. Kent Weaver raises in a new Issue Brief:  “But Will It Work?: Implementation Analysis to Improve Government Performance.”  According to Weaver, even though many implementation problems occur repeatedly across programs and can be predicted in advance, legislators often pay little attention to them when programs are being enacted or overhauled.    Weaver’s solution is to have the Government Accountability Office (GAO) perform implementation analysis for major legislative proposals in Congress, much like the Congressional Budget Office does with budget scoring.

Weaver’s Issues in Governance Studies Issue Brief outlines major elements of  Implementation Analysis and argues that it could lead to major improvements in policy performance.   He identifies a number of problems that are likely to be highlighted by Implementation Analysis:

–  Interpretation  (i.e., leaving legislation open to later interpretation)

–  Organizational mission issues (potential conflicts between established organizational missions and new tasks)

–  Organizational and coordination issues (where cooperation of several organizations will be needed)

–  Resource and organizational capacity constraints (a realistic assessment of financial, workforce and technology resources)

–  Time lines (underestimating organizational and resource challenges involved in policy change)

–  Political interference (mechanisms to insulate decisions from inappropriate interference)

–  Program operator issues (problematic  behavior of front-line workers)

–  Target compliance issues (the “targets” of government policies may fail to behave in ways that were anticipated)

Kent Weaver concludes his very thoughtful set of recommendations with sensible modesty, acknowledging that “Implementation Analysis is certainly no panacea to avoid government problems.”   He concludes, however, that “Implementation Analysis offers a potentially powerful new tool to ensure that governments make informed decisions and that government policies live up to their promise.”

Key National Indicators Are Now Real

Almost three years ago, I blogged on the need for a Key National Indicator System so we, as a nation, could track our progress using data, not diatribe.  It’s happened.  A provision buried on page 1,489 of the health insurance reform bill makes it real!

The legislation creates a bipartisan commission to oversee the development and implementation of a Key National Indicator System by the National Academies of Science. Congress has 30 days to appoint the 8 members of the commission.

The National Academies can partner with an independent non-profit entity – such as the State of the USA – or it can develop the Indicator System itself.  The project is appropriated $70 million, through fiscal year 2018, to develop and maintain the Indicator System.

This effort was launched in 2003 by then-comptroller general David Walker when he headed the Government Accountability Office.  He, and others, hope that providing an independent, non-partisan, non-governmental source of information about how well our country is doing will help provide a factual basis for policy decisions, and hopefully moderate ideological approaches to deciding on nation’s future.  As GAO puts it: “A well-informed nation is an essential component of a healthy democracy.”

More importantly for the performance world, it could also serve as a solid foundation for creating a more results-oriented approach to governing!

Final Four to lead the GAO?

It is looking more and more as if we may soon see a nominee for the position of Comptroller General.   CQ staffer David Clarke is reporting that the Congress will soon forward President Obama four candidates to be CG and lead the Government Accountability Office.

The four names are:

Linda J. Bilmes – currently a professor at Harvard’s Kennedy School of Government,

Gene Dodaro – who is acting CG since David Walker left nearly two years ago,

Ira Goldstein – who leads Deloitte Consulting’s federal government practice, and

Todd Platts – Republican Congressman serving York County, Pennsylvania.

Stay tuned!

HUD Transformation Initiative

As mentioned here a few days ago in  blog entry on innovation, the Department of Housing and Urban Development has been given in fiscal year 2010, what seems to be a large pot of money and new authority to conduct a transformation initiative in four areas that have been historically underfunded in HUD as well as most other agencies:

  • Research, evaluation, and program metrics
  • Program demonstrations
  • Technical assistance and capacity building
  • Information technology

Secretary Shaun Donovan was given authority by Congress to set aside up to one percent of the department’s budget (nearly $230 million) to support a new “transformation initiative.”

“However, [the House Appropriations] Committee is not in a position to grant full flexibility at this time, nor does the Committee believe flexibility to be the key obstacle in solving these issues.” So the Committee put some constraints on HUD’s use of these monies:

Information Technology Plans. “. . . not less than $80,000,000 and not more than $180,000,000 shall be available for information technology modernization, including development and deployment of a Next Generation of Voucher Management System and development and deployment of modernized Federal Housing Administration systems”. . . and “. . . .not more than 25 percent of the funds made available for information technology modernization may be obligated until the Secretary submits to the Committees on Appropriations a plan for expenditure that:

(1) identifies for each modernization project (a) the functional and performance capabilities to be delivered and the mission benefits to be realized, (b) the estimated lifecycle cost, and (c) key milestones to be met;

(2) demonstrates that each modernization project is (a) compliant with the department’s enterprise architecture, (b) being managed in accordance with applicable lifecycle management policies and guidance, (c) subject to the department’s capital planning and investment control requirements, and (d) supported by an adequately staffed project office; and

(3) has been reviewed by the Government Accountability Office:

Technical Assistance Funds. Of the remaining money, “. . . not less than $45,000,000 shall be available for technical assistance and capacity building. . . “ And this “technical assistance activities shall include, technical assistance for HUD programs, including HOME, Community Development Block Grant, homeless programs, HOPWA, HOPE VI, Public Housing, the Housing Choice Voucher Program, Fair Housing Initiative Program, Housing Counseling, Healthy Homes, Sustainable Communities, Energy Innovation Fund and other technical assistance as determined by the Secretary” . . .

Research, Evaluation, Program Metrics, and Program Demos.  “. . . of the amounts made available for research, evaluation and program metrics and program demonstrations, the Secretary shall include. . .”

“. . ..  an assessment of the housing needs of Native Americans, including sustainable building practices” and “an evaluation of the Moving-to-Work demonstration program” . . . And the Senate Committee “. . .  encourages the Secretary to plan or begin a demonstration on the conversion of public housing to Section 8 project-based vouchers.”


Plans on Use of the Monies.  And to top it off: “. . . the Secretary shall submit a plan to the House and Senate Committees on Appropriations for approval detailing how the funding provided under this heading will be allocated to each of the four categories identified under this heading and for what projects or activities funding will be used.”  . . . . This plan is due 30 days after the bill was enacted – which would be January 15. . . . so some folks in HUD didn’t have much of a Christmas holiday!  Or, with the new monies, did they?

So, while there may not have been much flexibility provided in the use of the funds, if a similar opportunity was available other agencies, is this the kind of transformation initiative other agencies might want to have?

Doing Big Things in Government

The release of a new book, “If We Can Put a Man on the Moon . . . ,” by Bill Eggers and John O’Leary, helped set the stage for the National Academy of Public Administration’s annual meeting that centered on management issues related to health care reform.

The authors examine big successes undertaken by the government – like the Manhattan Project, the Marshall Plan, the Berlin Airlift, and the moon landing – and draw some lessons about what each took to be successful.  They also contrasted these successes with failures such as Boston’s Big Dig, Iraqi reconstruction efforts, and Hurricane Katrina.

In surveys of senior career executives in the federal government, “60 percent said that government was less capable of executing large projects today than it was thirty years ago,” noted the authors.

The authors declare: “This book is about executing large, important, public initiatives. . . making sound policy choices is critical . . . however, brilliant policies poorly executed will likewise disappoint.” They then look at large government undertakings from a process perspective, identifying six key elements:

  • The undertaking must start with a good idea.
  • The idea must be given specifics, often in the form of legislation, that become an implementable design.
  • The design must win approval, as when a bill becomes law, signaling commitment.
  • There must be competent implementation.
  • The initiative must generate desired results.
  • Over time, the initiative must be subjected to reevaluation.

The authors take on each of these steps, describing potential pitfalls as well practical principles, tools, and techniques to be successful.  They provide entertaining, well-written stories of people and projects, from the efforts of Coast Guard Admiral Thad Allen in the wake of Katrina; to the implementation of the 2003 London traffic congestion charging program by Mayor Ken Livingstone; to the rolling blackouts in the California energy crisis of the late 1990s created by well-meaning but ill-designed state legislation, that led to the recall of Governor Gray Davis.

Their book contains insights and warnings helpful to the ongoing health care reform debate.  For example, they note that poor policy design “occurs because the work of drafting a bill that launches a major initiative isn’t generally treated like the design process it truly is.  Instead of a sound, executable design, the goal of the legislative process is often producing a bill that can pass . . . “  The authors continue, “Fully 45 percent of federal executives say that policy is rarely designed by those with relevant experience.  The dramatic disconnect between policy designers and policy implementers is perhaps the most broken part of the journey to success.” They recommend role playing and scenario planning efforts, like those used by military strategists and the private sector before it launches major initiatives.

They conclude with a warning:  “The tendency to see the enactment of legislation as an end unto itself, to claim credit for a great achievement upon the creation of a new law, is one of the most destructive tende3ncies in democratic governance.”

While Congress leads the legislative and policy design, the executive branch (and the Government Accountability Office) could proactively offer insights on the implementability of the pending legislation.  Eggers and O’Leary offer an ideal(istic) approach, recommending an objective “implementation feasibility assessment” to be done by an independent review board, much like the Congressional Budget Office offers its independent assessment of the cost of legislation.  However, that is not likely to happen any time soon!