FCW recently ran an article about a new OMB memo regarding the use of program effectiveness evidence in connection with agency submissions for the FY14 budget. The article topped the list of FCW most-read articles for a while, showing there is interest in this topic.
“Evidence-based government” is not a new idea. The “planning-programming budgeting system” of the 1960’s and the “zero-based budgeting” idea in the 1970’s were both outgrowths of the idea that budget allocations should be based on evidence about program effectiveness. (These decades also saw a number of very expensive experiments testing the impact of a number of anti-poverty interventions, many of which came up dry, showing the programs didn’t help very much against poverty.) The idea of “performance-based budgeting,” promoted by the Bush administration, was similar. Pretty much any time an administration proposes cutting back or eliminating a program, the proposal is based on evidence the program doesn’t work.
The basic idea behind evidence-based government was expressed in a comment attributed to John Maynard Keynes, to the effect that “when the facts change, I change my opinion – what do you do, sir?” And the basic problem with evidence-based government is that there is a lot of evidence for a psychological mechanism whereby most people don’t behave the way Keynes said he behaved: When contrary facts come in, most people who don’t like them don’t change their opinion. Instead they challenge the facts.
That is certainly a way of life in Washington, augmented by the fact that each side often has its own studies coming to opposite conclusions. Many in Washington are cynical about evidence.
This cynicism goes too far. Academics who are trained in research methods are constantly vetting academic studies, and there frequently emerge something close to a consensus about what conclusions are well-supported (or not) by evidence. Just calling something a “study” doesn’t make it so, and, if people in Washington were willing to place some trust in conclusions about different studies drawn by the scholarly community, the status of evidence for and against different programs, where it exists, would be better-established than the cynical story has it.
Probably the best we can hope for, in Washington’s political world, is for evidence to be an input, and the scholarly community that seeks to develop evidence be an accepted participant, in policy debates. And that, I actually think, is the case now.
Since the idea of evidence-based government is not new, there is in a sense less to the OMB memo than meets the eye. Actually, its contributions are two. First, the memo actually is less about the use of evidence in backing up budget requests than it is about agencies using more resources, even in tight budget times, to gather evidence about programs. The memo rightly points out that new methods have been developed since the costly studies of the 1970’s to gather evidence about programs at much lower cost – including the overlap between performance information agencies gather for performance improvement purposes and the world of evidence-based government.
Second, ever since the often-negative results produced by the program evaluations of the 1970’s, Democrats – who otherwise often denounce Republicans for opposition to science and to reason – have often been uneasy about the idea of evidence-based government, fearing it will lead to program cuts. So it is good to see a Democratic administration sign on to this idea.
Posted on May 25, 2012 at 7:46 AM0 comments
I have been in Barcelona for a few days at an academic conference, just as Spain is in the daily headlines with new crisis stories about possible bank runs, bailouts, and the collapse of the euro. I don’t want to say that the streets of the city show no evidence that the place is in the middle of a crisis, but you do have to look and ask to find the signs.
The banks are all open, with no lines or visible signs of panic. Despite a 25 percent unemployment rate, there are traffic jams at rush hour on the highways. There are some musicians asking for money in subway stations and on the trains themselves, but not noticeably more than in New York, and almost no beggars on the streets.
In Catalonia (of which Barcelona is the capital), the regional government has imposed a 5 percent wage cut for all civil servants, which includes professors at the (mostly public) universities, though this has not yet occurred at the national level or in many other regional governments. At a private business school where a friend teaches, the signs of crisis are more subtle: the faculty has been told to take economy class on the high-speed rail instead of first class, and the university has seen a dramatic improvement in the quality of people applying for junior-level positions as research assistants (that means lots of overqualified unemployed people are applying). Most people with jobs have received no pay increase for several years.
People I asked all said they had at least one, and sometimes several, friends who were unemployed, though with two-career couples, there was usually still one income. Somebody told me they were surprised recently to see a middle-aged person doing a pizza home delivery, rather than a teenager as would typically have been the case. Restaurant prices are noticeably lower than in sky-high London and Paris, with lots of meal combo specials at quite reasonable prices, and again apparently have stayed stable for several years; at the airport, I was surprised at the number of discounted items in the duty free stores (lots and lots of 20 percent off specials).
I guess one way of thinking about this is that standards of living have gotten high enough in rich countries that a fairly substantial belt-tightening can occur before the average person starts significantly suffering. It is still surprising that the level of unrest is, in spite of everything, so low with so many people unemployed.
Of course, the crisis could get much worse – say, if the Spanish government is shut off from debt markets or if the Euro collapses. What we see now might then be mild compared to that possible future.
In my free time, I have been looking a lot at the work of one of the most amazing architects ever, Antoni Gaudi. I am still amazed at how his mind conceived the concoction of strange shapes, wild colors, and asymmetries his architecture represents – there is nothing like this anywhere in the world. Here’s a link to some pictures of his work. Perhaps as amazing is that many of his buildings were private homes built for rich businessmen. My initial reaction was to wonder how these staid wealthy textile barons supported such unconventional architecture, but I got it when somebody said to me it was a way for the ultra-rich of Barcelona to show off.
Gaudi was very religious, and I spent an afternoon at his unfinished masterpiece the Sagrada Familia church, his take on Gothic. I knew the church was unfinished, and the derricks around it make clear that an attempt is underway almost a century later to complete it (using private contributions). But I was surprised at just how unfinished Sagrada Familia was at the time of Gaudi’s death in 1926. He had been working on it for 42 years; for the last 12 years of his life, it was the only project he was working on. Gaudi was a master of the change order -- I had assumed “unfinished” meant a few touches left to go, but in fact the building was about 10 percent complete when he died. They are estimating the church will be completed in 2035!
In short, a project management disaster…
In the square around the church there are a Burger King, KFC, Subway, and Starbucks.
Posted on May 21, 2012 at 1:59 PM1 comments
During the economic crisis of 2008-2009, I wrote a number of blogs and columns (and also discussed at speaking engagements) the need to urge the government to seek price reductions in existing contracts and to be more aggressive about seeking discounts when new contracts were awarded. In one column, that I must admit went over like a lead balloon, (one commenter asked what I had been drinking when I wrote it), I urged defense contractors to accept a temporary 1 percent reduction in prices for weapons in production and 10 percent for spare parts. In general, I think the government response to this suggestion was underwhelming.
Look, what I was proposing was exactly what was happening at the time in the commercial world, in deals between private buyers and sellers. A good Washington friend had commented to me that bids for renovating his apartment declined noticeably after the economic crisis set in. The media at the time was filled with stories about big companies seeking to re-open lease rental rates and other prices. I remember myself at the depths of the crisis going from counter to counter at an airport rental car center seeking discounts off best published rates – and ended up getting discounts negotiated on the spot. This is not “anti-vendor,” or anti-good relations between government and industry, it is part of how the world works. (When the economy is tight, do vendors hold back from being aggressive on price in the name of industry-government cooperation?)
At any rate, I see from a story in this week’s Federal Times, with the in-your-face title “Agencies Press Vendors to Cut Prices – Or Else,” that this issue has re-emerged, now in the context of the budget deficit and shrinking agency budgets. The article began with the brief anecdote: The Equal Employment Opportunity Commission had been paying $800,000 last year for hundreds of BlackBerry smart phones. Then the commission’s IT budget was cut by almost 15 percent. The agency pressed Verizon for some concessions it needed to maintain the service, and the company agreed to bundle cell phone minutes, scrapped underutilized phones from the plan, and moved employees to voice and data plans that would accommodate their phone use. The EEOC cut its costs by $240,000 for this fiscal year.
The article goes on to cite other examples, all driven by budget cutbacks where the agency simply doesn’t have the money any more to buy what it was buying at the same prices, of mid-contract renegotiations and greater aggressiveness on re-competes.
Of course this isn’t pleasant. In some situations, industry profit margins are already cut to the bone, so, like everything else, this shouldn’t be one size fits all. (My guess is that hourly labor rates for some labor categories may be a fairly ripe target for discounting, especially since the discounting off of General Services Administration schedule rates or Indefinite Delivery, Indefinite Quantity contracts can be temporary.) If agencies do this, they should also be giving significant past performance credit to vendors who are willing to understand the government’s situation and step up to the plate – this shouldn’t be punitive, and should provide an opportunity for vendors to show their support for their government customers.
The bottom line is that this is something contracting offices should be looking at aggressively.
Posted on May 16, 2012 at 10:39 AM2 comments