Thursday, October 08, 2009

"Americans: Uncle Sam Wastes 50 Cents on the Dollar" 

But when the people talk, should policymakers listen?

Gallup: "Americans are markedly cynical about the amount of waste in federal spending, more so than at several other times in recent history. On average, Americans believe 50 cents of every tax dollar that goes to the government in Washington, D.C., today are wasted...

"Americans are only a bit less critical of state government spending. The average amount they now say their own state wastes is 42 cents..."

When people say such things to pollsters should policy makers listen? Remarkably, some say "no". For instance, at the Capital Gains & Games blog Stan Collender writes:
There's one problem: the poll never defines "waste." Is it:
1. Money used for a wasteful purpose?
2. Spending on a project that will have a negative economic return? A program that is working well but you think has outlasted its usefulness?
7. A program that is working well but you think has outlasted its usefulness?
8. Any or all of the above and anything else you can think of?

Without a definition or any other type of guidance everything in the federal budget can and will be called "waste" by someone...

In other words... This poll is worthless.

But just as the poll question doesn't define "waste", this criticism of it doesn't define "worthless". Well, I can imagine two meanings for "worthless" in this context, and believe the Collender conclusion is wrong for both of them.

#1: Politically worthless. Since the polled don't have a precise, uniform definition of the term "waste", and people are probably generally ill-informed about the details of government spending programs, the government is advised politically to ignore their opinion that it is wasting a great amount of tax money at their expense. Hmm...

One may imagine Louis XVI as he was being marched to the guillotine consoling himself: "this Parisian mob is barely literate, hardly knows anything at all about how my government functioned, and if asked couldn't even agree upon a single definition of how they imagine I 'wasted' the national wealth to impoverish them all. Bah, their opinion is worthless and I was right to ignore it all along..."

"Stop talking to yourself, and head down please."

#2: Factually worthless. How could "the people" possibly know the truth? This is an aristocratic, er, "policy maker-centric" dismissal of public opinion -- what do average people know about evaluating waste in government programs? It takes experts on government programs, policy makers, to do that. And we, the experts, know there is no such waste. So ignore the ignorant rabble and their worthless opinion.

But the reality is that millions of average people -- indeed virtually all of us in this day and age -- have extensive, first-hand, personal experience of particular government programs in action, either as "customers" (ahem) of them, or as employees working within them, and often as both.

Let's consider some examples....

[] Here in New York City there are more than a million children in public schools -- at a cost now of more than $19,000 per student. Their millions of taxpayer-parents deal continuously with a school system managed like this.

[] Everybody deals with the Postal Service. And across the street from the local post office nearest to me is a deli that sells stamps -- at 75 cents each -- as one of its biggest customer draws, up there with lottery tickets. That's because the Postal Service has removed stamp machines from its post offices nationwide, because it it incapable of maintaining vending machines. So people wanting to buy a book of stamps, when faced with waiting in line behind messengers with baskets of certified mail to ship, go to the deli instead. Of course, the Postal Service's inability to operate stamp vending machines (even while it rents snack, soda, and coffee vending machines) is but one small symptom of its dysfucntional politicized management that is causing it to lose $7 billion this year (10% of sales -- as a monopoly!)

[] Medicare and Social Security? Even Obama tells us that Medicare's costs are 30% waste. (Which strangely, for some reason, just can't be cut from this single-payer government health program unless we all agree to "reform" private health insurance first. Is that some sort of blackmail?) And that's not even considering the underlying reality that Warren Buffett's employees at Dairy Queen pay 15% in payroll taxes from the first dollar of their wages to pay for his Social Security and Medicare benefits. How economically efficient and progressive is that?

[] Medicaid for the poor deals with millions of people as service recipients and providers, with with Medicaid graft -- not waste, but fraud and graft -- levels reported at 40% (!) in both New York and California. If "waste" is 30% in Medicare, believe me, it is a lot worse in Medicaid.

[] And as to military spending -- with all its dual-monopoly "bargaining", one-supplier cost-plus contracts, projects divided among all 50 states so politicians in all of 'em share the booty (and make sure the projects never die), projects voted in for electoral rather than military-need purposes, etc. ... need one whack that piƱata?

How about those programs for starters? How many millions of citizens have first-hand experience of them, both inside and out?

If all those millions from their personal experience form a consensus opinion of "50% waste in government", then perhaps our governing aristocracy inside-the-beltway policy mavens should pay heed -- be less intent on manufacturing rationales to ignore the "meaningless" bleatings of the ignorant citizenry? If not to do their jobs by governing well, then at least to protect their own political skins in the future when the trauma of the great budget crunch arrives and someone becomes accountable for letting all this waste fester.

Now, a pile-on argument often used to dismiss (and ridicule) the opinion of the plebeian citizenry is: If you really think so much government is waste, tell us what programs you want to eliminate -- Medicare? Social Security? National Defense?? Ha! If you can't name any then you are refuted as an ignorant rube.

Replying to Collender, Bruce Bartlett (seemingly less conservative all the time) goes this route...

I interpreted these data as meaning that spending could be cut by half without reducing government's ability to deliver services that people think are important to them ...

I tried to address this false notion in my last column by pointing out exactly what the government spends money on. As you know better than I, when people are asked what specific program they would cut the only one that gets significant support is foreign aid...

With commentators of the 'all spending is good' persuasion chipping in variously...

Unless you consider defense, social security, and medicare as government waste, which voters do not, [it is] impossible...
You know, you guys always talk about waste, but I have yet to see one of you point out exactly where that waste is and what you would cut. Those words become so hollow and tiresome....
But this is just low-grade sophistry.

[] If I believe there is great waste in government programs, that doesn't mean I want to cut or eliminate public education, public health care, postal services and so on, at all. I just want to eliminate the waste within them.

In fact, I may actually want to expand these programs -- which we could afford to do if we got rid of the waste.

[] Average citizens are perfectly qualified to identify and report the government waste they see in their everyday lives -- but they are not the management experts who are supposed to know what to do about it. Those "management experts" are, of course, the very inside-the-beltway policy mavens who are in denial here about the waste reports.

To draw an analogy, average citizens were perfectly qualified to spot and report the fact that General Motors cars were low-grade rattletraps relative to the price charged for them -- that is, that there was great waste in the General Motors production system compared to that of its competitors. But it wasn't the job of those average citizens to tell General Motors how to improve its designs, increase its productivity, cut its costs, to eliminate that waste.

That job belonged to the General Motors/United Auto Workers leadership aristocracy experts in their headquarters buildings in Detroit. And when the proletarian masses reported "quality and waste" problems to them, their response for thirty years was: No, there isn't really any quality-of-product and waste problem that we seriously need to eliminate, after all we are Number 1, we're General Motors ... And what happened?

Now the proletarian masses report major quality-of-service and waste issues to the government policy experts inside the beltway. And the experts dismiss them: "Waste? What waste? These foolish rubes don't even have a technical definition of the word 'waste'...", no doubt operating securely in the world view that since government is a monopoly, and in an even more secure position than General Motors was, it can't possibly "hit the wall" to their cost the way General Motors did.

Oh, wait ... it can.