Saturday, March 5, 2011;
WE TEND TO BE skeptical about calls to eliminate waste, fraud and abuse, and about plans to redraw bureaucratic organizational charts. Too often, these are excuses not to tackle hard issues rather than panaceas for problems of fiscal sustainability and governmental efficiency. Yet a new report by the Government Accountability Office offers a useful reminder of the counter argument.
The report, the first of an annually required assessment about duplicative programs or other potential cost savings, outlines the often-infuriating, sometimes-expensive duplication, overlap and fragmentation in government programs, such as the 15 federal agencies that administer at least 30 food-related laws. As the GAO discussed the federal response to the salmonella outbreak in eggs last year, "FDA [the Food and Drug Administration] is generally responsible for ensuring that shell eggs, including eggs at farms such as those where the outbreak occurred, are safe, wholesome, and properly labeled, and FSIS [Food Safety and Inspection Service, part of the Department of Agriculture] is responsible for the safety of eggs processed into egg products. In addition, while USDA's Agricultural Marketing Service sets quality and grade standards for the eggs, such as Grade A, it does not test the eggs for microbes such as salmonella. Further, USDA's Animal and Plant Health Inspection Service helps ensure the health of the young chicks that are supplied to egg farms, but FDA oversees the safety of the feed they eat." The result: inadequate safety at higher cost.
Duplication exists within departments as well as between them. At the Defense Department, which provides care for nearly 10 million military personnel, retirees and their families, there is "no central command authority or single entity accountable for minimizing costs and achieving efficiencies," the GAO found. Rather, "the Office of the Assistant Secretary of Defense for Health Affairs, the Army, the Navy and the Air Force each has its own headquarters and associated support functions, such as information technology, human capital management, financial activities and contracting. Also, the three services each have Surgeons General to oversee their deployable medical forces and operate their own health care systems." A more streamlined structure, it was estimated, could save $281 million to $460 million annually.
The biggest savings often involve the least glamorous areas. More competitive bidding and greater coordination among agencies could save billions in federal contracting, a $500-billion-plus annual business. So could a crackdown on "improper payments" - to Medicare and Medicaid providers, recipients of unemployment insurance rand beneficiaries of other government programs. The amount of such payments was estimated at $125 billion in 2010.
To its credit, the Obama administration, through the Office of Management and Budget, has been working on these decidedly unsexy issues. Last week, it proposed another area identified by the GAO: shedding excess federal property, a process often made more cumbersome by congressional resistance to shuttering home-town facilities. The administration, which estimates it could recoup $15 billion by selling these assets, proposed a base-closure-style commission to recommend bundles of properties for disposal, which Congress could then vote up or down. These are sensible steps, and the GAO performed an important service by pointing the way to more.