Government reorg plan draws fire

Efficiency is the new feng shui.

In an effort to streamline regulatory oversight and trim government operations, President Barack Obama announced plans last month to consolidate the Small Business Administration and five other business-oriented agencies into one new Cabinet-level agency. Shortly after, administration sources revealed a second phase of the plan involving the National Oceanic and Atmospheric Administration, the National Institute of Standards and Technology, and other agencies, and announced another plan to close 259 offices at the Agriculture Department.

Although Obama is seeking to increase efficiency and save money, his effort with regard to SBA hasn't gotten rave reviews. Reactions from Republicans in Congress have ranged from skepticism to cautious approval.

The Wall Street Journal wasted little time in accusing Obama of hypocrisy or political opportunism — or maybe a little of both. The unnamed author of “The Reorganization Man” editorial said perhaps Obama was taking a cue from Texas governor and former presidential hopeful Rick Perry, who wanted to eliminate federal agencies.

“Another way of putting it is that this new emphasis on streamlining the bureaucracy is Mr. Obama's version of the Texas governor's 'Oops,'” the editorial continued. “Having presided over the largest expansion of government since LBJ — health care, financial re-regulation, spending 24 percent of GDP, the surge of industrial policy — Mr. Obama's pollsters must be saying that voters have the jimmy legs about bigger government and that he thus can't run only as a Great Society man.”

At CNN, Amy Wilkinson wondered whether the move would really help small businesses.

“His announcement came with a mixed signal,” she wrote. “The president gave SBA Cabinet ranking at the same time that he proposed merging six government agencies into one department focused on commerce and trade. Is [this] political theater in an election year? Because actual policy to support small-business growth matters much more, particularly since the engine of small-business growth is not what it used to be.”

In Federal Times, Sean Reilly and David Jackson pointed out that some congressional resistance is motivated by turf protection. For example, objections to the proposal to fold the Office of the U.S. Trade Representative into a new agency drew fire from the chairmen of the House and Senate committees that have jurisdiction over the office — Senate Finance Committee Chairman Max Baucus (D-Mont.) and House Ways and Means Committee Chairman Dave Camp (R-Mich.).

Other critics cast a jaundiced eye on the economic benefits of the proposed reorganization. Susan Eckerly, senior vice president of public policy at the National Federation of Independent Business, focused on the link between government regulations and job growth in an article by Janean Chun in the Huffington Post.

"Despite the president's lip service to small businesses in announcing his plan, it is unlikely to help job creators in any meaningful way,” Eckerly said.

Rather than simply reorganize, she said the administration ought to diminish agencies that are “standing in the way of growth” by creating burdensome regulations. That includes the Environmental Protection Agency and the Labor Department.

Other news outlets wondered whether the reorganization is likely to even be accomplished. In an article for Federal News Radio, Emily Kopp concluded with a quote from Susan Schwab, who served as the U.S. trade representative under President George W. Bush.

"Reorganization proposals are a pain in the butt," Schwab said. “They are demoralizing. They take up a huge amount of time and energy, and they usually don't happen."

However, Veronique de Rugy, a senior research fellow at George Mason University's Mercatus Center, was quoted in Politico as saying the proposal was too timid.

“Unfortunately, the president's proposal only scratches the surface,” de Rugy said. “Reducing the size of the economic pie that the government holds usually allows room for the private sector to expand. This helps generate economic growth and jobs that we desperately need right now.”

About the Author

Technology journalist Michael Hardy is a former FCW editor.

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Reader comments

Mon, Feb 6, 2012 Hampton Brown Fairfax, Va

Realigning the Federal Agencies to meet policy challenges is a smart way to conduct business. After 911 we created a start-up agency called Homeland Security. It’s still going through it growing pains. It will probably be aligned again as the threat shifts. It was created as a response to a serious domestic threat. Surely there appears to be no disagreement among critics that the U. S. Commerce Policy is important for the goodness of the Country. Commerce and jobs are intertwined. As the President stated, our commerce policy is broken. It needs to be fixed. One component of making a change is the United States Foreign Commercial Service. It is a bureau within the Department of Commerce. It has boots-on-the ground in foreign countries. Unfortunately, (USFCS) is no longer the entrepreneurial business export spear envisioned by President Carter and executed by President Reagan. It was established after the business community complained that the Department of State was giving lip service to our commercial interest. President Obama bold step in realigning our export policy should also take a hard look at the USFCS. These are steps he should consider: 1) Director General report directly to the new Department Secretary; 2) recruit business entrepreneurs with professional in-country experience instead of career candidates rotated from one post to another 4) honoree post assignment to retired American business folks to retain overseas market presence for areas that FCS has withdrawn; 5) aligning FCS with Chamber of Commerce overseas posts; 6) Moving FCS out of the Embassies which have become security bunkers managed by Department of State. If we can’t get total agreement to making a smart Agency realignment overall, let then start incrementally with the United States Foreign Commercial Service. Let’s put jobs first, and give the President the power to make that change.

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