Manzi in the Morning- Daniel Grayton Interview

First time candidate Daniel Grayton came on the Manzi in the Morning Radio program (every Wednesday on 980 WCAP from 10:00 AM TO 11:00 AM) last week to talk about his candidacy for Methuen City Council (At Large) and some of the important issues facing the City. His campaign website is www.graytonforcitycouncil.com My thanks to Daniel Grayton for taking the time to be on the show.

http://yourlisten.com/swf/Player.swf?id=16990511

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Government as a Business- Schnurer Part Two

Eric Schnurer has posted the second installment of his series on government, with a focus on governments “competing like business.” I talked about Schnurer’s first piece on this blog last week. Let us look at the new installment

Schnurer starts by making clear that he does not believe that government can “be run like a business.” He points to some of the reasons for that.

It’s pretty clear that governments do not actually operate like businesses for a vast number of reasons:

The employees, for the most part, cannot be fired, and thus have little reason to hit performance metrics, let alone respond to the views of management.

The politicians ostensibly overseeing all this are guided by a complex set of conflicting motives and incentives and have little reason to work together or move in the same direction. These managers and executives are in turn guided by the demands of shareholders, investors, and consumers who themselves have contradictory and often ill-defined expectations for the organization.

Most of this results from the fact that governments aren’t guided by the same profit motive as private-sector businesses. That isn’t necessarily bad in itself — in fact, a lot of what we expect and want governments to do is precisely those activities that are not profitable (or, at least, where profit cannot easily be captured). But the lack of a single, clear metric makes managing government, and assessing how the whole enterprise is doing, a lot more difficult.

The author is correct, in my view, when he says that government cannot be run like a business. His reasoning, outlined above, is pretty hard to refute. Maybe they are the three iron laws of government. I will get to the second point more specifically later, as it is the one that has to be the most infuriating, but maybe the one that is least subject to change. As I mentioned in the prior post the fact that government is not a business does not mean you cannot apply sound business principles to government, and that is where Eric Schnurer takes this post. He looks to get away from the idea that sound business principles might only reflect relentless cost cutting, and moves to the concept that there is some space for government to innovate, even when that innovation produces a “higher cost” product. Schnurer gives some real world examples in his post, including Delaware becoming a financial center, a business improvement district in Philadelphia, and the potential for peak hour tolling plans that may contribute to reduced road congestion.

On the issue of the type of model for government that is preferable Schnurer makes the very valid comparison between the so called “cost cutting” model, which infers lower taxes and fewer services, to innovation models that manage to find new ways to create revenues, including some that have folks that live outside the entity paying some of the freight (Delaware tolling is a good example). He lays out what he sees as the problem:

Competing on cost relies on commoditization, low investment, low democratization, highly concentrated gains, and highly externalized costs (such as labor or environmental exploitation). Third World countries and their governments will be those that, like their private-sector counterparts, continue to be resource-dependent commodity producers with low margins, producing better-than-subsistence benefit only for a few who live off the many, placing little value on innovation and ingenuity — and thus on people and their participation. The United States could (like, say, many firms in the apparel industry, or countries whose economies are based largely on resource extraction) choose that as a competitive strategy. But is that really the vision of the future we prefer?

Schnurer, of course, is decrying that “race to the bottom.” I do agree that, as laid out here, Schnurer makes a strong argument. My own experience, in local government, shows me that the distinction is not always the black and white choices laid out by Mr. Schnurer. Efficiency, and reform, does not of course mean that government is necessarily racing to the bottom, but it does lead to the inevitable political conflict. A good example of this might be in the so called “shared services” model, which indeed does cuts costs, but in the cases where it is done properly will actually produce better services for citizens. In a prior post we looked at some of those potentials laid out in a study done by the Boston Federal Reserve. Governing Magazine, in a post on “shared services“, looks at some of the drawbacks and many of the positives.

So it isn’t hard to understand why most of these jurisdiction-consolidation proposals languish on the vine of legislative consideration. Yet the potential for savings is so important that it should not be allowed to slip away. The alternative with real potential for achieving service efficiencies is no secret: inter-local agreements, purchasing pools, sharing of specialized personnel and equipment, and in some cases either multi-county special districts or state assumption of services.

I realize that maybe I am now the one rolling off the rails by moving to something that probably is not even a source of disagreement, but I feel the point is an important one. As far as that second point made by Schnurer on the “conflicting motivations” of politicians referenced above it is undeniably correct, but from my perspective it is a real problem. Why? Despite my having run for political office it is hard not to be frustrated by decisions based on knowingly false assumptions and numbers in the attempt to achieve a political goal. Even in local government (or maybe especially in local government) reform based on “sound business practices” is met, in many cases, with tremendous push-back. Now I have totally derailed. I look forward to the next installment in the fine series in “The Atlantic” by Eric Schnurer, and hope to have him on my radio show in the very near future.

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Chapter 90 Funding: New Tug of War

Yesterday I posted about the budget conference currently under way in Boston between the House and Senate, and listed some of the local aid numbers for Methuen. I mentioned that there was still some controversy over where we would end up on Chapter 90 aid, with everyone agreeing that the number should be $300 million, but not agreeing on how to fund that number, which is a $100 million increase over last year. The Governor asked the Legislature for an additional $1 billion in revenues targeted towards transportation, but will receive only about half of that amount.(Transportation Finance is also in conference) In response to that the Governor is only willing, for now, to release Chapter 90 monies of $150 million, a cut of $50 million for localities.

The Bond Authorization bill passed by the Legislature is subject to the Governor’s release of funding, and in light of the Legislative reduction in the Governor’s new revenue proposal it appears that he is going to reduce an account that is very important to legislators, and vitally important to localities. From the Massachusetts Municipal Association website:

<blockquote The administration is citing multiple transportation priorities and the unresolved issue of available revenue as the reasons for withholding $150 million in road maintenance funding from cities and towns…“The administration continues to work with the Legislature on transportation financing,” Transportation Secretary Richard Davey stated in the letter to cities and towns, “but it is clear that we will need to make hard choices about where to devote available resources.”

He said “it may be possible” to release additional Chapter 90 funding later in the fiscal year, “depending on the final disposition” of a transportation finance plan in the Legislature.

Now that is a bit of leverage being applied by the Governor to the Legislature. Don’t pass my full finance package? Then some of your priorities will go unfunded. The Mayors have taken notice:

Braintree Mayor Joseph Sullivan, president of the Massachusetts Mayors Association, told the State House News Service, “We’ve gone from what was a proposed increase of 50 percent to a 25 percent reduction. In many ways it’s not comprehensible to us.”

So the Transportation Finance package continues to create some disagreement between the Governor and the Legislature. Will the Governor veto the final package? Will he eventually release the balance of the Chapter 90 money to localities? More to come for sure. The MMA statement calling for the release of the full $300 million is here.

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Methuen Local Aid Allocations

Both the Massachusetts House and Senate have passed budgets, with the process of reconciling those documents in the hands of a conference committee. There are some slight differences in the documents, with the below listing the different allocations for local aid for Methuen in the three separate budgets. It appears as if the Governor is willing to go along with a one year increase in Chapter 90 money to $300 million, but there are still some legislative hurdles to go before any of that money is released to cities and towns. It appears as if the Legislature will send both the budget and the transportation finance bill to the Governor at the same time, which of course will put him in a difficult position if he was of a mind to veto the transportation finance package, which is still in conference. Not a lot of attention right now, but still some major decisions left to be made on the budget.

Methuen
Chapter 70 Governor 41,134,210 House 40,125,234 Senate 40,240,901

Unrestricted Local Aid Governor $4,844,608* House 4,707,570 Senate 4,598,863

* Governor number includes a new line worth $245,745 called Annual Formula Aid Calculation that both the Senate and House omitted.

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Podcast: Steve Kerrigan, Candidate for Lt. Governor

I was very fortunate to have on the Manzi in the Morning Radio Program (980 am WCAP every Wednesday at 10:00 am)Steve Kerrigan, who is a candidate for Lt. Governor. Steve was the first announced candidate for that office, and came on to talk about his candidacy, some of the critical issues facing Massachusetts, and his work as President of the Massachusetts Military Heroes Fund, as well as his work as the Chairman of the Steering Committee for the New Frontier Network at the JFK Presidential Library. Some great talk about President Kennedy and the Presidential Library, as well as his work for Senator Ted Kennedy. His website is can be found here. www.stevekerrigan.org. He is on twitter @stevekerrigan. My thanks to Steve Kerrigan for coming on the show, and I look forward to having him on again in the future.

http://yourlisten.com/swf/Player.swf?id=16988041

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Detropia- PBS Looks at Detroit

A PBS film on Detroit, and what is happening to it, and how it is impacting some of its people, tonight at 10:00 p.m. on PBS. Worth a look.

http://dgjigvacl6ipj.cloudfront.net/media/swf/PBSPlayer.swf

Watch Coming to Independent Lens: Sundance Award Winner Detropia on PBS. See more from Independent Lens.

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Methuen Memorial Day Service

Today’s Methuen Memorial Day Service. Apologies for the poor audio, as the wind was blowing hard and made it difficult. Thanks to the American Legion, the VFW, and all that participated in today’s ceremony.

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Enforce No Budget No Pay

There have been so many budget battles in Washington over the past few years that the public has by and large tuned them out. From my perspective the Republicans, even when they may have had a solid point or two, have always managed to take those points to such an extreme that they have made a budgetary hash out of it. The very fact that their own budgetary numbers simply have not worked has never stopped them from making ridiculous claims in order to satisfy their donor base. The Democrats have not exactly covered themselves in budgetary glory, but the President has made reasonable attempts to bridge budgetary differences with Republicans, who were simply not able to compromise on anything of substance.

One area where the Republicans were able to actually score some public relations points against the Democrats and the President was the failure of Senate Democrats to pass a budget for four years. Although that was not a substantive issue it allowed Republicans to paint Senate Democrats as not serious on enacting budget reforms. In fact House Republicans, in dealing with the debt ceiling this year, passed a bill that included what they called “No Budget, No Pay“,attempting to embarrass Senate Democrats. Speaker Boehner summed it up:

“We are going to pursue strategies that will obligate the Senate to finally join the House in confronting the government’s spending problem,” Boehner said. “The principle is simple: no budget, no pay.”

The Speaker, after two big failures in budget negotiations with the President,also indicated a strong desire to return to what he called “regular order” in budgeting, saying that the traditional Congressional methodology for budget making should be adhered to. The Speaker second guessed himself in a speech given after the collapse of talks with the President. From The Hill:

Boehner now believes that effort was a mistake, and he has vowed to Republicans in the House that he will not negotiate one-on-one with Obama going forward. He is instead recommitting to a “regular order” process, whereby the House and Senate pass legislation independently that can then be reconciled with amendments or with conference committees.

(Emphasis added.)

The relentless Republican attacks on the Senate Democrats for their failure to produce a budget finally worked, with new Senate Budget Committee chair Sen. Patty Murray not only producing a budget, but passing it in the Senate. Now “regular order”, as noted above, would have both branches appoint conference committee members to work out the differences between their budgets. Standard operating procedure, and “regular order” for sure. But it seems that Republicans are now loathe to appoint conference committee members, with the Speaker as well as (some)Senate Republicans refusing to participate in “regular order.” It seems that Republicans now realize that “regular order” will allow some politically uncomfortable minority motions to hit the House floor (motions to instruct), and they just do not want to allow that to happen. So much for regular order. The Speaker is trying to explain how his new position actually meshes with his old position (he was for regular order before he was against it). The Speaker’s explanation? From TPM:

“I think you also know that under rules, if you appoint conferees and after 20 legislative days there’s no agreement, the minority has the right to offer motions to instruct, which become politically motivated bombs that show up on the House floor,” Boehner said. “I just want to be frank with you: we’re following what I would describe as regular order. These informal conversations are under way. That’s the way it should work.”

That explanation made as much sense as the one Republicans gave when they tried to explain why the Paul Ryan budget did not balance the federal budget for 40 years, when the stated purpose of his budgetary work was to fight the evil of debt and deficits. But I digress. In the Senate it has become hand to hand combat between Republicans, with some of the more traditional Republicans looking to utilize “regular order” and go to conference, while the newer members, more in line with Tea Party values, resist. Yes those that Senator McCain dubbed “whacko birds” have dug in pretty hard. Marco Rubio made it clear that “regular order” is not for him.

“I have tremendous respect for this institution,” Mr. Rubio said in an interview on Friday. “But I’m not all that interested in the way things have always been done around here.”

McCain’s favorite “whacko bird” Sen.Ted Cruz, took aim at Republicans.

“Here is the dirty little secret about some of those on the right side of the aisle,” Mr. Cruz said of his fellow Republicans. “There are some who would very much like to cast a symbolic vote against raising the debt ceiling and nonetheless allow our friends on the left side of the aisle to raise the debt ceiling. That, to some Republicans, is the ideal outcome.”

I would have to say that Senator Cruz is probably right about that issue. Some Republicans would prefer that the United States not default, but do not want to take any responsibility for making that vote. To Cruz those folks are just squishes. He is willing to give us the full monty of no compromise, followed by default. Senator McCain has taken the position that “regular order” should hold.

Mr. McCain called the demands of his Republican colleagues “absolutely out of line and unprecedented.” The Senate passed the budget before dawn on March 23 after a grueling all-night session, he noted, saying it was time to try to reach a final deal with the House in a negotiating conference.

“Will this deliberative body, whether it is the greatest in the world or the worst in the world, go ahead and decide on this issue, so we can at least tell the American people we are going to do what we haven’t done for four years and what every family in America sooner or later has to do — and that is to have a budget?” he asked. Although few of Mr. McCain’s colleagues took to the floor to join him, many have expressed similar views.

My only question is why “no budget, no pay” does not apply here? Since the Republicans brought it up I don’t see why the Democrats are not yelling for enforcement. More public relations I know, but the Republicans had a degree of success with their effort. Or maybe the Democrats are content to let the Republicans argue this issue out themselves. Whatever the outcome it certainly does not bode well for budget agreement, if we ever do get to conference.

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Manzi in the Morning- Michael Widmer Interview

Michael Widmer came on the Manzi in the Morning Program to talk about Transportation Finance, the State budget, unfunded OPEB liabilities, and reform in transportation. Widmer is the President of the Massachusetts Taxpayers Foundation, and he is, in my view, the pre-eminent budget analyst in Massachusetts. Thank you Michael Widmer for taking the time to come on the program. The Massachusetts Taxpayers Foundation website is here.

object width=”522″ height=”300″>http://yourlisten.com/swf/Player.swf?id=16985474

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Governor Patrick Restores Some Cuts

Governor Patrick, after cutting the current budget due to lower than expected tax revenues, is restoring $20.8 million of the $225 million cut as tax revenue begins to rebound. The latest figures show tax revenues $500 million or so above revised benchmarks, with about a month or so left in the fiscal cycle. Of particular note for localities is the Circuit Breaker amount of $11.5 million. Some good news there. The full list is below.

$5.25 million homeless students transportation;
· $1 million for regional school transportation;
· $11.5 million to reimburse for special education costs through the Circuit Breaker;
· $100,000 for micro small business loans;
· $50,000 for assistive technology at Massachusetts Rehabilitation Commission;
· $135,999 for Vocational Rehabilitation at the Massachusetts Rehabilitation Commission;
· $162,500 for Massachusetts Service Alliance (MSA);
· $200,000 for the Buy Local Program at the Department of Agriculture;
· $216,980 for Council on Aging (COA) Grants at Elder Affairs (ELD);
· $280,000 for the Department of Conservation and Recreation (DCR) to hire additional summer staffers;
· $717,554 for rest home rate increases at the Department of Transitional Assistance;
· $1 million for the Massachusetts Technology Collaborative program created in last year’s Jobs Bill;
· $53,000 for grants to Visitor Information Bureaus;
· $50,000 for Aid to Incarcerated Mothers; and
· $41,667 for the South Boston Community Health Center.

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