Eggers: Government 2.0

Information technology is about more than just saving money. It's about transforming operations.

Between 44,000 and 98,000 Americans die each year because of medical errors. Meanwhile, as much as $300 billion is spent each year on health care for treatments that are often ineffective, unnecessary and inefficient.

Those and other health care problems — including high costs, uncertainty, medical error and poor coordination, according to a recent White House report — are caused by our society's failure to take advantage of the benefits of IT in the health care system.

"The innovation that has made our medical care the world's best has not been applied to our health information system," President Bush said.

The Bush administration's high-profile campaign to transform health care through the better use of IT reflects a watershed moment. The campaign included the creation of a new health care IT czar and numerous events with the president. It's the first major policy area in which administration officials have made the case for IT as a critical lever for transformation, as opposed to a way to make government operate better and cheaper.

Hopefully, this is only the beginning.

Technology-enabled changes could profoundly impact everything from warfare to transportation, regulation and education. In these and other areas, IT has the potential to not only reinvent service delivery but also change the terms of the left/right debate and render many existing policy debates irrelevant. To fully exploit the potential of today's technologies, government officials must move beyond Web sites, Web portals and internal improvement projects to embrace fundamental transformation. To understand what this means, let's take a closer look at three opportunities for change.

The infinite classroom

The large sign on the door read "Welcome to Our Class. Room No. 12, Teacher, Mrs. Thorpe." Inside, the walls were covered with children's drawings and pictures of historical events. Children fidgeted at their desks, working on math word problems and spelling lessons.

Although this setting seemingly could apply to any classroom in the United States, it isn't like anything we've ever thought of as a public-school classroom. Each teacher has only four students. Teacher Sandy Thorpe moonlights as the four children's mother. After leaving Room No. 12, they wander into their kitchen, not a school hallway.

The Thorpe children are part of a new kind of public school, the Pennsylvania Virtual Charter School.

The curriculum, books, assessments, computers, teachers and everything else are provided for free by the school, which receives money from the state for every enrolled student.

The charter school is only a glimpse into how profoundly technology is changing education. Students can now get personally tailored education without attending special schools or classes. It's even possible to eliminate much of the guesswork involved in deciding which learning approach works best for each student. Using artificial intelligence, the computer can adapt to the pace, complexity and direction of the learning experience according to each child's learning style and attention span. Children in the same classroom could learn different things in different ways at the same time.

"No more teaching to the middle. No more one-size-fits-all," said John Bailey, former director of the Education Department's Office of Educational Technology. "Instead of mass production through assembly lines, it's mass customization tailor fit to the student."

Meanwhile, technology now allows schools to use data from regular assessments and "eBay-style" feedback mechanisms from parents and students to periodically recalibrate lesson plans. Assessments could eventually replace grades because they offer more precise information about a child's strengths and weaknesses, allowing for midcourse corrections. Once schools and online providers use technology to synchronize their internal assessments with state standards, regular online learning assessments could replace stomach-lurching, high-stakes year-end testing.

E-learning also eliminates physical boundaries. Universities already operate in a borderless world, drawing students from every state and even from other countries. Now, the ability to offer an education to faraway students is coming to elementary and secondary schools.

By redefining schools and the ways teachers teach and students learn, online learning has the potential to fundamentally alter the structure and system of public education as much as — if not more than — vouchers, charters, national standards, smaller class sizes and other better-known public-school reforms do.

"Radical education reform has until now focused on shifting the governance arrangements or the flow of funds, but it hasn't shifted the basic technology of schooling," said Chester Finn Jr., a former assistant secretary of Education who is now president of the Thomas Fordham Foundation. "With e-learning, we're talking about transforming the technology of schooling in the broadest sense of the word. What could be more revolutionary? That's an invention of flight kind of breakthrough."

Intelligent transportation

Technology could also potentially transform transportation, enabling innovators to convert roads from inert slabs of concrete to dynamic networks.

Just as digital technology linked soldiers on the battlefield in Iraq with their commanders, technology can link transportation planners with emergency road crews and drivers, providing all of them with real-time information about congestion. This will provide drivers with the ability to make more informed travel decisions and will enable transportation planners to get more out of existing roads. For example, planners could assess the cost of roads according to current congestion levels. The result would be a more efficient transportation network.

The term used to describe the technologies that will enable these changes is intelligent transportation systems (ITS), a catch phrase for a mix of infrastructure, communications and vehicle technologies, including adaptive signal control, collision-avoidance systems, dynamic message signs, electronic toll collection, intelligent cruise control, mayday systems, virtual weighing stations, ramp metering, route navigation devices, traveler information systems and more.

ITS is no panacea. It won't eliminate congestion or the need to add lanes, and it won't manage demand or build more roads. However, by increasing roadway productivity — the inefficiency of today's freeway systems costs the economy $1 trillion a year — ITS can play an important role in preventing congestion from worsening while improving safety and diminishing environmental damage. And all that would cost less than traditional infrastructure fixes.

"Compared to adding capacity and discouraging people from using roads," said ITS pioneer Larry Yermack, former president of the Intelligent Transportation Society of America. "ITS technology is the easiest and least expensive thing to do, and it offers the highest benefits."

London is a good example. Vehicles entering the central city during weekdays are now electronically charged a flat fee between 7 a.m. and 6:30 p.m. The results of this now 2-year-old experiment have exceeded nearly everyone's expectations. Traffic speeds are up 40 percent, congestion is down 30 percent and roundtrip travel times have fallen 14 percent.

By nearly every measure, London's ambitious experiment in electronic road pricing must be judged an overwhelming success.

Eventually, the same technologies that enable zonal road use charges in places such as London, Edinburgh, Scotland, and Auckland, New Zealand, and open-road tolling in Toronto and other cities, could change the way roads are funded, replacing gas taxes with direct road access fees.

If more countries implement ITS technologies, transportation departments would no longer be judged merely by the miles of pavement they lay. Instead, the technologies would enable people to track how well the transportation system is performing on a block-by-block basis in clearing accidents, maintaining travel time reliability and providing thorough traveler information. Travelers could use this information to plan trips and bypass traffic jams, while legislators could use it to tie funding directly to system performance.

Information Age regulation

Wired roads, cars and drivers are neat — and we'll need them if we want to stave off massive traffic congestion — but it's not the only area in which we should be able to reap economic benefits from digital government. A huge economic windfall will come from easing the government-to-business transactions that consume so much of businesses' time and resources.

Government agencies such as the Labor Department's Occupational Safety and Health Administration, the Environmental Protection Agency and the Small Business Administration have started using technology to make transactions such as paying fees and obtaining permits easier for citizens. The goal is to simplify and streamline reporting requirements and to reduce the number of forms businesses must submit.

For example, Labor has more than two-dozen online expert advisers to help businesses better understand how to comply with various regulations. The result is more than $300 million a year in regulatory compliance savings.

If all federal agencies aggressively digitized government-to-business interactions, they could trim the costs of compliance as much as 20 percent, saving businesses billions of dollars annually, said economist Thomas Hopkins, dean of Rochester Institute of Technology's College of Business.

Transformation, however, entails going even further — using IT to fundamentally rethink the way government regulates certain areas.

For example, because of the Internet, consumers can more easily obtain detailed, user-friendly information about the quality and safety of services and products.

Evaluations by third-party rating organizations covering everything from nursing homes to retail merchandise can be accessed via the Web. Consumers can tap into the knowledge of other users through eBay-like reviews. In their 2003 book, "The Half Life of Policy Rationales: How New Technology Affects Old Policy Issues," Fred Foldvary and Daniel Klein argue that those and other technologically driven innovations have reduced or, in some cases, eliminated justifications for command-and-control regulation in certain social or economic areas.

One implication is that traditional regulatory approaches, such as detailed rules and suffocating bureaucratic controls, can sometimes be replaced with "accountability through sunlight."

Consider restaurants. A failed health inspection might be far more effective in getting a restaurant to clean up its kitchen than a $200 fine. On the day New York City first posted information from the city's Health Department about restaurant inspections, the site received 45,000 hits an hour. Because the inspections are available via wireless devices, New Yorkers can check a restaurant's inspection report before entering it for dinner.

A sunlight approach works best when consumers equipped with more information might alter their behavior — for example, by shunning a business — and thereby cause the business in question to change to avoid losing customers. Those consumers could also be employees or potential employees, who would factor in the accountability information in choosing one employer over another.

Inspired leadership

Although technology will be crucial for solving these big issues, it will not convert today's government agencies into sleek, efficient, citizen-centered organizations. Without inspired leaders and an active citizenry, digital government can't end turf fights among agencies, make bad regulations disappear or change the irrational incentives that fail to reward good performers or punish poor ones. But digital government eliminates many of the excuses for not changing.

Technology-enabled transformation entails breaking old habits and learning to do business in new ways. This, in turn, requires taking risks and embracing change, which does not come naturally to government officials. In fact, nearly all the incentives in government work against those things. That is why strong leadership is so indispensable to achieving the fundamental changes outlined here and why, absent such leadership, the transformation effort will inevitably fall short.

Eggers is global director of Deloitte Research's public sector and a senior fellow at the Manhattan Institute for Policy Research. This article is adapted from his new book, "Government 2.0: Using Technology to Improve Education, Cut Red Tape, Reduce Gridlock, and Enhance Democracy."

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