Things We Read Today (26), Wednesday

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The Gaps in This Column

As I said when I began the Things We Read Today column (that’s “read” in the past tense, by the way), the idea wasn’t to create a new daily obligation for myself.  And it’s shown over the past couple of weeks.

As we approach an election, politics overwhelms policy. Therefore, much that’s been in the news has been beyond the scope of the Current.  Beyond which, I’ve been very busy, for reasons personal, professional, and political.

Government Action, Designed for the Questionable

Of course, politics overlaps with policy, so this article is definitely relevant — or, at least, it definitely ought to be relevant — to the current Congressional district 1 race in Rhode Island:

The federal Department of Housing and Urban Development first identified problems at the [Providence Economic Development Partnership] during a general review last year. A second review in 2012 produced a July report that said the partnership had failed to adequately oversee its loans and 60 percent of them are in default.

The federal agency also identified $1.5 million in ineligible or questionable expenses in the past six years. All but $108,863 of that occurred during the administration of former Mayor David N. Cicilline, now a U.S. representative.

Frankly, in my view, this is an argument against too much government involvement in economic development.  If Rhode Islanders have had the opportunity to learn anything from the past few years, it’s that giving politicians and bureaucrats a mandate to “grow the economy” is an invitation to corruption and incompetence.

Then again, Rhode Islanders could also have learned not to reelect the politicians who’ve brought our government, at every level, to its present sorry state.  We’ll see what November brings, but there’s definitely justification for skepticism that voters have absorbed such lessons.

Seeking Budgetary Restraint by Offering a Pretty Please with a Cherry on Top

Speaking of lessons that appear to be unlearnable in Rhode Island, the headline from an article on Friday’s Providence Journal front page just about sums it up: “Officials: 7% reduction would cut too deeply.”  The named officials are from the state Department of Education, and they say it would be absolutely impossible for them to “trim 7 percent from their operating budget as requested.”

Yup.  That $1.2 billion for elementary and secondary education (up nearly 6% from last year’s enacted figure) couldn’t possibly be brought down so much that it would round down to $1.1 billion, or even restrained from growth.

Not to worry, though, because Governor Chafee’s office has clarified that the target percentage is really just a pleasant reminder to take a second look at requests:

“That doesn’t mean that all departments will be cut by 7 percent,” said Chafee spokeswoman Christine Hunsinger. “The process is designed to be tough and get agencies to identify savings and priorities.”

Those with eyes to see might observe that the incentives seem awfully strong to make it seem as if any cuts (or even restraint in growth) are simply impossible.  The usual tricks for accomplishing that are, one, to spend every penny allocated and, two, to prioritize non-essentials, so reductions affect essentials.

With education being the easy target for big-government types to trumpet as an “economic development” strategy, I don’t think anybody should expect the budget to do anything other than climb toward the next-highest billion.  That’s true despite RIPEC’s finding that Rhode Island has the eighth-highest per capita spending on elementary and secondary education in the nation.

Then There Was Stimulus

For more government spending that was absolutely necessary, see this Washington Guardian story on the 1,900 investigations ongoing in response to allegations of misuse of federal stimulus dollars:

The government’s chief spending watchdogs have already secured nearly 600 convictions and judgments against people and companies accused of misusing stimulus funds and have a whopping 1,900 investigations currently open into possible wrongdoing, officials say.

And that’s from watchdogs within government. One wonders what outside-government skeptics with the same access could find.

And Then There Are the Numbers Games

Lastly, I want to thank Ted Nesi for the well-rounded review of Rhode Island’s Medicaid waiver in light of Mitt Romney’s debate call-out to the state… and not just because Ted mentions an older post of mine on the subject.  As is characteristic of his work, Ted gives a pretty balanced overview.

However, he only highlights part of the problem with the naysayers’ numbers.

Those who’ve been striving to invalidate Rhode Island as an example of the value of block grants and other Medicaid reforms (including some of those to whom Ted links) have focused on the smaller-than-expected savings experienced in the Ocean State.  The first problem with that is the fact that ObamaCare and stimulus contained catches that prevented Rhode Island from saving millions of dollars through its reform.

A second consideration may be even more significant, in terms of dollars saved:

Describing the savings as realized “over the course of three years” is also misleading. Lewin’s study covers fiscal years 2008 through 2010, but none of the independent steps of the reform were implemented until FY09. Many were not fully implemented until well into the last year of the study period, and some had yet to begin even as the report was being completed.

Whenever debates over public policy arise, particularly concerning public policies designed to trim the size and power of government (or even to trim the growth in the size and power of government), this is a common strategy.  A pilot program goes into effect, and the benefits are downplayed by selectively choosing the components that count as well as the time periods under consideration.  In this case, the activists reduce over $50 million in savings down to less than $10 million by, first, shuffling out large portions as if they weren’t part of the total reform and, second, dividing less than three years of savings by three.

In Summary

The key point for all of the above (except my excuse for light posting, of course) is that government has a lower threshold for claiming more of your money than does anybody else who’d like to get into your wallet.  Businesses have to convince you that their products and services are worth the price.  Charities have to convince you that they’ll do enough good with the money to make them the most efficient means of accomplishing charitable ends.

But government, well, government can just take your money, layering in taxes on your income, property, activities, purchases, and investments in addition to fees whenever you actually have to deal with government (a list that, naturally, government determines). The combined list of all of these financial intrusions plus all of the things that government spends its money on is so overwhelming that agencies and officials only have to make the sparest arguments for spending and barest excuses when they’re caught doing something wrong in any one instance.

Those arguments and excuses, by the way, are further buried under shovelfuls of social issues, race bating, gender-discrimination claims, and all of the other proper and improper junk that comes with public policy.



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