We're Broke

Book cover
The Price of Governmentby David Osborne and Peter HutchinsonBasic Books. 385p $25.95

While Ronald Reagan tagged Democrats with his tax and spend label, it was his 1980 electoral adversary, Jimmy Carter, who while governing Georgia in the 1970’s pioneered zero-based budgeting in government, the system by which each program’s very existence must be justified every time spending plans are drawn up. Today, even White House officials under George W. Bush have taken a page from Carter’s playbook in devising the Performance Assessment Rating Tool, unveiled as an across-the-budget justification paper in an appendix to this year’s federal budget proposal.

PART has a number of inherent flaws, including its ability to deliver scientific-appearing rationales that all too coincidentally resemble the visceral choices of previous years. Still, its adoption is the latest federal instance of a confluence in thinking about public budgeting across party and ideological lines: emphasize results.


In consonance, authors David Osborne (co-author of the best-selling Reinventing Government) and Peter Hutchinson argue that policy makers need to stop debating guns versus butter and concentrate on how much of either can be purchased to yield measurable, clear outcomes without breaking the fiscal piggy bank. Aiming for a blueprint toward such a goal, these public administration consultants write up a curiously apolitical, anti-ideological set of recipes for politicians and political aides that sidesteps matters of principle and practice that the citizen reader may miss.

Nonetheless, their work comes at a strategic time, as budgetary political gridlock begins to afflict governments from governor-recalled California to legislature-deadlocked Virginia. The easy, short-term shortcutssuch as Virginia’s financing a car tax cut with the now-vanished surplus in public assistance fundshave all been taken in most states and localities. Now looms the reckoning. The body politic has not yet found a path out of the traditional conflict between fiscal conservatism at any social cost and liberal social activism at any price.

Against that background, Osborne and Hamilton proclaim that something funny has happened on the way to fiscal Armageddon.

Democratic Gov. Gary Locke of Washington, facing the prospect of a 15-percent across-the-board cut in his state’s budget, was casting about for a new, more thoughtful alternative to hunting for cuts. The authors’ St. Paul, Minn.-based consulting firm, the Public Strategies Group, convinced the Locke administration to focus on the results desired with the funds available after cuts. At the end of the process, Locke was able to announce a genuinely streamlined government that, even at the cost of 2,500 state jobs, won plaudits from every editorialist in the state.

Similarly, Republican Mayor Stephen Goldsmith of Indianapolis learned to trim city expenses by subjecting every city service to competition between existing government agencies and private-sector bidders. He achieved a massive change in policy, which did not end up privatizing anywhere near the number of jobs initially feared, by changing the budgeting process. He gained union support to do so by promising and delivering some of the savings for a massive neighborhood revitalization program.

In a smaller-scale case study, co-author Hutchinson discovered, while serving as commissioner of finance in Minnesota, that he was signing supervisory reports on 50 to 100 employees for whose work he could not personally vouch. When he learned that the time sheet system cost $13 million a year, he decided to scrap it, at once enhancing employee morale and saving money. To paraphrase Flaubert, God is often in seemingly trifling details.

Despite its lively narrative style and practicality, The Price of Government suffers, like the Bush administration’s PART, from predictability. The pragmatism drawn from its case studies is, of course, the gospel according to the Democratic Leadership Council, Bill Clinton’s centrist thinking space. No surprise here, since co-author Osborne served as a senior advisor to Vice President Gore in 1993, helping to run the task force to reinvent government. Other prescriptions are expressly drawn from the private-sector organizational approach known as total quality management, quite the corporate rage some years ago. Yet the very managers spoon-fed on T.Q.M. led the way to the era of job outsourcing, wage slashing and mass layoffs. The authors take no note of that development or what it might portend in public administration.

Indeed, the book loses depth as it progresses. Its case studies and recipes seem to be simplified versions of the authors’ memos to consulting clients. The result is entire chapters that have the look and feel of an infomercial for their firm. Even then, the marketing strategy is narrowly targeted. While the authors proclaim at the outset that they are writing for a wide audience of leaders, activists and concerned citizens, there is virtually nothing in the book that an ordinary citizen or activist outside government can go out and do, short of running for public office or seeking an appointment to an executive position in government. The we in the work’s subtitle clearly refers to political professionals, in particular those already converted to the authors’ assumptions, not the citizenry.

To the citizen, the authors’ initial diagnosis begs some weighty questions. Will there never again come a time like the 1990’s in which, with Clintonian-Greenspanian panache, an administration will suddenly pull the surplus rabbit out of the tattered fiscal hat? Will no future president succeed in persuading the public to accept higher, yet more equitable, taxes to aid those least able to fend for themselves, as did Johnson, Carter and Clinton? The citizen reader will be forgiven for concluding that the authors, like Oscar Wilde’s cynics, appreciate the price of government, but not its value.

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