New ideas for getting waste out of government

Why does it often seem like our government is only so-so? Simple, SOSO.

When we talk about government waste, the picture that often comes to mind is one of offices that are overstaffed with workers who spend lots of tax dollars accomplishing very little. Let’s not rule out that possibility. But there is a more pervasive type of waste.

I’m talking about SOSO waste: same old methods, same old organizational structures, same old expenses. Same old, same old: SOSO. That is how we end up with so-so government.

This is not to disparage the creative abilities of our civil servants, only their motivation — and sometimes their latitude — to seek out innovative new ways of doing things. Stasis is in the nature of the bureaucracy, with its budgets rolled over from year to year and its work force largely held over from regime to regime. This is true the world over.

And it’s not unique to the public sector. Corporate chieftains and middle managers know all about turf wars, about spending every dime of this year’s budget to keep every dime in next year’s budget.

But there’s a key difference. Businesses face competitive pressures that break their lulls more frequently than do public bureaus. The market regularly wrings out the waste that comes with stasis.

That’s why you can always count on a panel of business experts to spot government’s lingering inefficiencies, as a group convened by Lt. Gov. Casey Cagle just did.

From a state budget that is already $3 billion slimmer since the recession began, the panelists found a further $3 billion, at least, in savings for the next five years. Their report comes at a crucial time: Another $1.5 billion in cuts is needed for the 2011 budget, and 2012 stands to be even worse.

The panelists told Cagle there are ways to cut the budget by ending the same old, same old practices, minimizing the effects on the public.

The biggest item relates to employees’ health benefits. Companies like Whole Foods and Safeway have cut their employee health costs by providing financial incentives for state workers to live healthier lives: keeping their weight or cholesterol down, for instance.

An actuary tapped by the panelists projected immediate savings for Georgia from this and other measures could reach $100 million. The figure could rise to $300 million annually, or 10 percent of the state budget for health benefits.

The panelists also recommended expanding community health centers for indigent patients and adding a small co-pay for Medicaid recipients who visit emergency rooms, rather than primary care clinics, for nonemergencies.

Georgia makes less use of nonprofit clinics than its neighboring states do, yet these clinics still manage to save us $400 million a year. A small investment in the clinics might double that savings, says panelist Kelly McCutchen of the Georgia Public Policy Foundation. The figure could be even higher if the clinics serve more poor patients with chronic diseases such as diabetes.

More ways to stop SOSO, and fast: Expand the use of shared back-office services like payroll and accounting among agencies and schools (saving some $30 million a year); allow agencies to sign leases longer than one year, giving them the flexibility to negotiate lower rents ($20 million); make wider use of virtual education, so that students can study physics or calculus without their schools having to hire teachers for those subjects (at least $4.5 million).

Also: Have teachers put another 1 percent of their salaries toward their pensions ($39 million) and reduce the use of furloughs or layoffs.

Not all these changes will be easy. But doing the easy and SOSO has brought us the so-so.

32 comments Add your comment

arnold

March 24th, 2010
8:05 pm

You have to remember that government has a different objective than a business. Government provides a service. Business attempts to earn a profit. There are two different objectives. I suspect just the different objectives creates the discrepancies.

John

March 24th, 2010
9:26 pm

They are not necessarily different, Arnold. Many businesses attempt to provide a service, and often times they compete directly with the Government (i.e. UPS vs. USPS). The difference, as Kyle correctly points out, is that UPS has outside threats which demand efficiency and innovation on their part to avoid closing their doors. This is something that the government simply does not have to contend with, which helps to lead to their inefficiency.

Good post Kyle (see, I can make valid points every now and then).

@@

March 24th, 2010
10:45 pm

Excellent!

The problem with government is they operate on the rote system. The by-product of this system are people who often find it difficult to understand cause and affect , to think openly and rationally. If some new information is not put in front of them, explaining every detail, chances are they won’t be able to fill in the missing parts.

Thanks, Kyle. There IS hope.

96 SC

March 24th, 2010
10:45 pm

Rather than buying automobiles to be used by employees, the government should pay mileage to the employees who should use their personal vehicles. Refrain from buying high performance vehicles for Law Enforcement Agencies and purchase compact stripped four cylinder autos equipped with communication gear that can alert nearby Law Enforcement Officers. Rather than leasing Real Estate adapt existing owned couty, city, and/or state facilities for government use, Move certain State Departments e.c. Revenue, Agriculture, Transportation, etc. to non-metro locations. To maximize citizen access and reduce traffic, enact two shifhts of four day, 10 hours per day work weeks for all departments and agencies to be opened seven days a week.

get out much?

March 24th, 2010
11:00 pm

John, here is a difference for you. UPS can chose where to locate its operations based upon earnings potential, while the USPS is required by law to provide Universal Coverage (at the same price). Also, UPS can close up shop if the area is no longer profitable, while the post office is required to stay.

CJ

March 24th, 2010
11:00 pm

I don’t agree at all with the recommendations concerning teachers. These folks are already overworked, underpaid, and under-appreciated. In a state that consistently ranks near the bottom in education, we need to find the revenues to pay them a lot more instead of cutting their retirement benefits—essentially what the savings plan described above suggests.

Otherwise, at first glance anyway, I like many of the suggestions above.

vuduchld

March 24th, 2010
11:02 pm

The place to start is with the dimwitted pseudo lawmakers whose phat rumps are occupying space in the capitol. You folks really don’t need this scum and in fact, I bet things get better when they’re all flushed down the toilet. If you Teabeggers are serious about reform, look in the mirror and start cutting.

John

March 24th, 2010
11:51 pm

Get out much?, did you read my comment? I agree that the Post Office is required by law to provide certain services at set prices, which is what contributes to their inefficiency. Also, it’s UPS’ ability to change operations based on needs and demand (as you stated) that make them much more efficient than government services. But thanks for restating my point, glad you agree.

Ace

March 25th, 2010
12:00 am

I think gov’t gets taken by private contractors. Verify quality of work and materials specified and stop the bid rigging constuction deals.

joan1

March 25th, 2010
12:29 am

It is a shame that our politicians don’t avail themselves of the services of a third year graduate business class at almost any decent university. They could simply give the problem as a class project, and we would come out with a much better outcome than we have been ending up with. And about politicians–you have to be rich to be one. That leaves most of us out.

jt

March 25th, 2010
6:23 am

Have the state congress in session only every other year.

Works in Texas. And we would probably have less asinine laws.

Churchill's MOM

March 25th, 2010
7:07 am

I don’t think there is really a budget problem because the Georgia Legislature is working on more important things, like carrying guns in a bar. I would like to see Legislature attack what is really wrong with public education and drastically cut administrative overhead and put the savings in the class room. Last week a metro Atlanta school system announced a cut of over 500 teachers, all their para pros and nurses but NO CUTS in the central office. WE need to cut the fat out of both the Georgia University and public school system.

Ragnar Danneskjöld

March 25th, 2010
7:33 am

The fundamental difference between the productive economy and government is that the former provides a product people think is worth paying for, and so vote with their economic dollars. The latter funds services only by theft from those who lack the capacity to fight back..

Apathetic independent

March 25th, 2010
7:54 am

Kyle- You are the first journalist I have seen to touch on the most absurd part of Obamacare- the myth of the uninsured dying from lack of access to health care and the costly unfunded mandate to bankrupt the states by increasing Medicaid. You said:
“The panelists also recommended expanding community health centers for indigent patients and adding a small co-pay for Medicaid recipients who visit emergency rooms, rather than primary care clinics, for nonemergencies.”

First you should research the fact that the number of these community clinics increased under President Bush and was applauded as a successful attempt to increase health care for the poor before he left office by no less than the NY Times. Second the clearest proof that this approach works in saving millions comes from no less than the University of Chicago hospital and the efforts of its former attorney, Michelle Obama. She found a way to get around the absurd federal requirement that everyone in an emergency room must be treated by funding and diverting non-emergency and non insured patients to community clinics. The savings were enormous. Funny thing is her husband never mentions a word about community clinics.However the downtrodden beneficiaries of government largesse probably feel that going to a free community clinis is not equal to free care in a fancy doctor’s office.I suggest a large picture of Michelle Obama and driving directions be placed in every waiting room of each emergency room in the US. It could also be that the uninsured wsingle working class might be incetivized to buy insurance if they were forced to visit one of these clinics and if they got appropriate tax breaks for insurance and health savings accounts . Five minutes on Google will verify these facts.

Now we have the folks who are claiming a fundamental right to “the pursuit of happiness” to equalize health care for everyone. (see Pelosi’s speech bfore the vote Sunday.)Where did that right come from?? -an expression by Jefferson in the Declaration of Independence and not the US Constitution. Research will show he meant the happiness of people free of foreign regulation and taxation without representation and any benefits. That’s exactly what Obamacare intends to do to anyone who is capable of earning a living- pay for equal health care of those who do not feel they have any resposibility for theior own coverage. There are also the spoiled seniors who want gym memberships, Viagra and every other drug advertised as well as electric scooters if they are too overweight to walk..Isn’t this misuse of public funds what the whole health care debate is truly about???Kyle you have only scratched the surface on the absurdity of our health care debacle.

Ragnar Danneskjöld

March 25th, 2010
8:07 am

Well argued, Apathetic. The unspoken core truth in the entire healthcare debate is that the death rate is 100%, and will remain so. Only the leftists believe that everyone should have a right to take all of his neighbor’s wealth in a futile attempt to disprove the core truth. Leftism learned nothing from King Canute.

JD

March 25th, 2010
8:11 am

So — ask those panel members how much credence they would give to a panel of individuals with no direct experience managing that business to tell them how to cut costs and give more service to more people? And, oh yea, you have 8 weeks meeting for maybe 6 hours to come to those conclusions? No one runs a business that way.

Will

March 25th, 2010
8:28 am

Interesting ideas. Here are a couple of ways NOT to save taxpayer dollars.

1.Adding another level of needless government by creating the 160th county in north Fulton County. In a state that already has more county governments than all but one state, this needless governmental expenditure is another example of big government spending and wasteful spending at a time when school teachers are being forced to take pay cuts.

2.Wasting taxpayer dollars on frivolous litigation regarding health insurance. I would like to see these irresponsible politicans put up a portion of the legal cost for this hopeless litigation out of their own pockets and not out of mine.

3.Allowing free loading deadbeats to “opt out” of purchasing health insurance and then allowing these free loaders to use my tax dollars when they need medical care. If more people had health insurance, more people would be healthier, thus savings billions upon billions of tax dollars now going to free medical service.

Ragnar Danneskjöld

March 25th, 2010
8:34 am

Dear Will @ 8:28, we understand that you think (1) efficiency arises from centralization and consolidation of government power, (2) Constitutional freedom ought not be asserted if it costs any money or effort, and (3) adding $1 trillion to Federal spending, to facilitate “free” services for 40 million people (who mostly elect out of the health insurance system due to their lack of need) in an already strained system will not lead to rationing. We disagree on the fundamental economics.

Road Scholar

March 25th, 2010
8:39 am

Kyle, are the teachers suppose to donate the 1% to their retirement from the cost of the furloughs that are mandated? Also, do you realize the number of private consultants who have been hired to examine Department’s business practices? And the number of Departments that have implemented them?

Or do you want a “paperless” program that was recently announced by a legislator that mirrored a similar program started years ago? Oh, the repub lawmaker traveled frm Atlanta to Macon to make his announcement, and handed it out ON PAPER…and it was copied on a single side of the paper! Why didn’t he announce a web address to get his info? Because the Repubs are all talk and stupid action! Where’s our transportation funding bill? Education? Ethics reform? Oh, we need to clarify guns? I’m sure something on abortion is coming. Give me a break!

jconservative

March 25th, 2010
8:43 am

The State can cut medical care for retirees and put them on Medicare.

JP

March 25th, 2010
8:44 am

If you want to improve education while cutting cost have the money follow the child. My kids go to a private school that offers a better education at half the price the public school spends. Competition for $ improves efficiency and results in every business, why not education?

rn

March 25th, 2010
8:54 am

Dear Road Scholar: Since you don’t know how to spell it, I doubt you are one. It is Rhodes not Road

The Tar and Feathers Party

March 25th, 2010
9:14 am

There you go again JP, wanting ME to pay for your child’s private school education via MY property taxes. I already have to pay for the worthless, bloated public schools, now YOU want to add a new burden? I suggest we eliminate all property taxes, and let each and every parent pay the full cost of THEIR child’s education. That should take a lot of money out of education, making the whole process more efficient. You do not want to add money to an inefficient, bloated process, that just rewards the current system and people. Rather we should cut, cut, cut.

Road Scholar

March 25th, 2010
9:21 am

jconservative: The state already mandates retirees to join Medicare at age 65 with no additional state paid health insurance. try getting your facts right!

m: No my moniker is Road. Think about it. Oh, and yours is so unique; how long did it take to adopt yours?

John

March 25th, 2010
9:28 am

Actually hers is rn, not m. Try getting your facts right!

Jess

March 25th, 2010
10:03 am

What would it take to get Cagle to return to the govenor’s race?

Azazel

March 25th, 2010
10:13 am

Both Govenors Barnes and Perdue put into place intitiatives to consolidate the state’s information infrastructures as a means to reduce waste and cost overruns due to each and every department, division and programs manageing and owning information systems.

Besides controling costs, these intiatives also aimed to standardize and integrate and share all of the state’s information assets (further reducing waste by automating manual business processes — paper shufflers became like firemen on a deisel engine).

However, implementation met with resistance both political and administrative. Administrative resistance had two major factors; one, managers’ salaries are justified by the number supervised, so, as managers’ staff sizes would decrease their salaries could not be justified; two, as a corallary, staff sizes tended to increase and filled with lower payed employess, rather than having a small staff composed of highly trained, results oriented professionals (although, most state employees serve the public well and professionally). Political resistance has several factors: vendor bias, bugetary political power of state agencies and fear of consolidation.

An attempt was made some years ago to reduce the size of the Divsion of Public Health, at the downtown office, by 50 to 70 percent using an elegant and feasible business model that not only would reduce cost but improve services and health status, that was rejected due mainly to the factors stated above.

Churchill's MOM

March 25th, 2010
10:16 am

There is some good news on the national front and it looks like a few Real Republicans are going to force real “pay go”, I’m all for that & hope the first thing cut is foreign aid. Why do we borrow money from China to give to people who knife us in the back?

http://www.politico.com/news/stories/0310/34963.html

retiredds

March 25th, 2010
10:20 am

some good ideas here, Kyle. I am not sure the current crop of Repubs in the GA legislature are up to the task. I think the ethics legislation will be a telling story. Will they be able to raise the bar to the level of TN and MD. I think, and I really do hope I’m wrong on this, they will come up short.

retiredds

March 25th, 2010
10:28 am

Oh, and one more thing. Kyle I know you have some contacts at the state level. Would you please inform the governor and the Repubs in the legislature that to shout that Thurbert Baker is playing politics with the health care suit is the height of hypocrisy. EVERYTHING has become politicized these days, by BOTH parties. You know, I truly believe these guys at the state and national level must think that all of us are stupid out here. Most Americans know what’s going on and its “trolling for votes” season. My main beef is if they want to join in they should pay for it themselves. I certainly don’t want my tax dollars going for what will be a loser. Take the $$$$ that would be spent on that and allocate it to the GA education system and keep a few more teachers employed.

David S

March 25th, 2010
6:08 pm

Get rid of government and the waste will follow. To expect anything but waste and fraud and inefficiency from government is to not understand its true nature. Government is immune to the forces of the self-regulating marketplace that takes care of all of these kinds of problems (or at least doesn’t socialize them). With no requirement to “earn” the money they consume, or any requirement to “produce” anything of value, there is no way that government can ever be anything but wasteful and full of fraud.

That is the problem with conservatives and why libertarians are far superior in their principled philosophy. Conservatives actually think that the government that is an enormous failure at everything it does at home, can somehow deliver nirvana on foreign soil as it wages war. This false belief would just be stupid if it weren’t tragically destructive of our safety and our freedom.

You cannot separate the baby from the bathwater. They must both be thrown out. Its ok though. This is Rosemary’s Baby.

Andrew

April 5th, 2010
5:04 pm

As someone who works for the state, I can tell you that innovation is NOT rewarded. Often times, it is quite the opposite. Improving processes in small, (but often very efficient) ways is smiled upon if the idea is top-down, but not if it is bottom-up. Also, many of these positions are under-compensated compared to the private sector, so your best and brightest tend to fill their resume as quickly as possible, and cut and run. Those of us who stay have no benefit to be excellent. In my job, whether I “meet expectations” or “exceed expectations” doesn’t make a dime’s worth of difference in my paycheck. Working hard and caring doesn’t get you anywhere. I do it because I believe it is my Christian obligation to do so, but I don’t expect to get any further in my career because of my competency.