Thursday, October 10, 2019

Federal Monopoly on Insane Management 7/4/p014

No private business, or organization is managed as poorly as federal government.  This is what causes annual deficits greater than a trillion dollars, $17.5Tr in debt, over $50Tr in unfunded liabilities, the anemic GDP, non-job market, high costs, and our bleak future. If federal government managed itself half as well as a dollar stores chain, the country would recover and prosper.

Ask a business why it exists; you’ll get an answer. The federal government can’t answer because of wide disagreement about the scope of its powers. Businesses don’t make a habit of making changes without evidence that they’ll work. In federal government, there is no such thing. Legislators pass laws, but an agency of bureaucrats accountable to no-one decides how to implement them. The result could be what legislation intended, or the opposite, or be so expensive it isn’t worth doing. Mechanisms to test effectiveness, provide ongoing reports, identify opportunities and implementing changes, provisions for pulling the plug, and backup plans appear to not exist.

No pizzeria going through bad times borrows money from the competition, uses it to give raises to overpaid workers, or research better pizza-making techniques, and then borrows more to pay the rent. The federal government sold debt to China and didn’t stop until the Chinese decided US bonds weren’t worth buying. The requested  2015 budget includes a 1% salary increase for federal workers ($1B) whose compensation is higher than their private sector counterparts.  At least a third of the requested 2015 discretionary budget of 1.16Tr ($39B) is for untested initiatives, (job training for disadvantaged, grants to community colleges, underwriting small business loans), new building requests, and IT systems. Congress could say no to these, but it can’t change funding for portions of legislated (mandated) programs without passing another law.

Why deliver pizza to a house a mile away when you can send it to pizza regulators in Washington who, after taking a slice or two, send what’s left to your state to schedule delivery if the customer deserves the pizza based on a long list of criteria.  That’s how federally mandated unemployment compensation works. Businesses footing the bill could pay people the way they pay severance.  Instead, companies pay federal taxes which are distributed to states that administer and enforce federal regulations.  This odd delivery system is often used in federal government. Large changes are usually not tested on a small scale and good ideas can become nightmares. The ACA, bailouts, stimulus programs and common core are a few examples that add up to tens of trillions. It’s not hard to wreck an economy if you do things this way.

You can balance the budget by eliminating or cutting departments, calling a moratorium on new initiatives, privatizing functions businesses can do (e.g. selling real estate, and job training), legislating a moratorium on mandatory government programs that are not essential (e.g. than food and shelter, medical), testing their impact and eliminating those with no impact. Streamlining processes and regulations that implement laws and testing to quantify  the impact (positive and negative) of regulations would eliminate many. Keeping more programs discretionary, implementing a process for changes in mandatory programs,  selling public land, drilling rights and mining rights, replacing the federal reserve with decentralized clearing houses, eliminating or reducing attempts to stabilize the economy through monetary policy, eliminating stimulus programs that give funds to specific businesses, cutting aid to enemies of the US and reducing all foreign aid. Legislating a flat tax for all people, businesses and organizations (nonprofit included) would reduce the IRS budget to a small fraction of what it is now.

Finding the money is the easy part. Getting commitment to run this country as well as a chain of dollar stores is not impossible but is difficult. The combined effort of elected representatives, a number of state governments, with wide organized grassroots support, could work. The commitment required, a big one; it means putting the goal of fixing this country above career, above leisure time, long hours, doing unpopular things that will anger people.  One filibuster, one legal  case, sporadic protests, will not do it. Talk will not do it. Coordinated relentless barrages of actions against the executive branch, bureaucrats or Washington insiders for corruption, for failure to represent, for illegal actions, and  a commitment to  continue regardless of apparent success could work.


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