More on Government from Eric Schnurer

The Atlantic has been running a series of posts by governmental efficiency expert Eric Schnurer, which started with the thought provoking piece entitled “Government Should Run Like a Business—but Not in the Way You Think”. I did my own post on that piece, and I have been following the series closely, anxiously awaiting each succeeding post. The last two have been, in my view, outstanding. Lets take a look at where Schnurer has taken the series, and why I think he has managed to get to what I consider essential truths on government.

The first post, called “What Small-Government Fans Should Learn From Walmart”,has Schnurer talking about the distinct difference between striving for efficiency in government as opposed to looking to eliminate functions of government.

In short, saving money and doing things more efficiently do not necessarily mean cutting needed activities — in fact, they usually mean quite the opposite. But if you want to start an online food fight, suggest “cutting government waste.” You’d think waste wouldn’t be such a terrible thing to mind, yet the suggestion seems to anger both poles of the political spectrum.

Of course he is right. Eric Schnurer has an extensive background in government, and here is where he gets to some essential truths. What is that truth? Conservatives look not to trim government and create efficiency, but to simply eliminate vast areas of government on ideological grounds. But what about the left? Don’t they want efficiency?

Talk of cutting government waste also inflames liberals, as if acknowledging any inefficiency in government simply plays into the hands of the enemy. According to former Texas state comptroller John Sharp, when he wrote a 12-page memorandum to officials in Washington on how to implement a systematic search for savings, then-House Speaker Tom Foley told him it was a “personal insult to the Democratic Party.”

Pretty timely point there on inflaming liberals, as we have just seen some pretty big push-back in Massachusetts on the issue of Auditor Suzanne Bump’s findings relative to the Department of Transitional Assistance. The push-back by the Governor and others, at some level, gets right to Schnurer’s point. In their heart of hearts they believe that the focus on waste in this area is misdirected because it subjects this program (transitional assistance) to unnecessary political attacks, and endangers a constituency that is most vulnerable, economically as well as politically. As a Democrat myself I know the argument to have some merit, but in the end running the program efficiently instills confidence, and allows the political battle to be fought on much more sustainable ground. The series is candid in acknowledging that the financial problems of government are not going to be solved by eliminating “waste, fraud, and abuse”, but makes the important (at least to me)point that we should tackle those items anyway, and in so doing breed taxpayer confidence instead of cynicism.

Patrick Bresette of the liberal think-tank Demos has framed this as almost a Catch-22: Attempts to root out waste only reinforce public perceptions of government as wasteful. Nevertheless, as Bresette observed, cutting waste also increases public confidence in those who do so. The National Performance Review that identified waste and inefficiency in the federal government resulted in substantial savings and was part of an overall revival in Clinton Administration fortunes — and public trust in government — during the final six years of Bill Clinton’s presidency.

From my perspective it is a point that is hard to dispute, but one that tends to get lost in the continuous arguing over whether programs should actually exist or not.

But the proper level of public spending is a separate issue from whether it should be as effective and efficient as possible. Spending money more intelligently, rather than less, oughtn’t be viewed as an offense against liberalism or Keynes….

As I had mentioned in my own earlier review I was somewhat discouraged by some of the postings made after the first piece, which reflected (to some degree) a glossing over of the main points made by Schnurer, and an immediate back and forth over the “proper level of public spending”, with left and right issuing the requisite insults against each other.

Finally let me close where Schnurer starts, with Wal-Mart. Schnurer makes the point that Wal-Mart has discovered, as most companies do, that in providing group health insurance costs can be excessively spiked by only a few folks who may have long term health issues that are very expensive. The answer?

That’s what makes a recent piece on Walmart’s employee health-care plan so interesting. The company long resisted providing benefits to employees at all. But then it discovered that health care actually wasn’t that expensive for most workers — big costs were really driven by a small number with high-cost conditions. Then it realized that it could drive down those high costs through a simple expedient: providing even better care. All of a sudden, workers with serious health challenges were getting all-expenses-paid trips to the Mayo Clinic.

“We come at it from the perspective of how can we improve quality,” a senior vice president told National Journal. “When we improve quality, often there will be a reduction in waste or unintended or unnecessary cost.” (This echoes similar findings about Mayo’s approach generally.)

In this case the answer is not to further reduce health care offerings, but to promote health care policies that attempt to efficiently deal with the underlying problem. Lesson for managers? Identify key issues that drive costs, and then deal with them. Deferring decisions only makes the ultimate solution more costly. And dealing with them does not imply taking a meat cleaver to programs, but molding them to deliver a desired service as cost efficiently as possible. Pie in the sky? I think not. There is a new posting by Mr. Schnurer that I will get to in the next few days. For now please read the series if you are interested in how government delivers services. Outstanding work!

Eric Schnurer will be a guest on Manzi in the Morning today, Wednesday July 3rd at 10:15. Tune in to 980 AM WCAP for what should be a very interesting segment.

This entry was posted in Manzi in the Morning, Media, Municipal Finance, National News and tagged . Bookmark the permalink.

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