Rightsize: Government Budgets in the 21 st Century

1. Rightsize:Government Budgets in the 21st Century Council of State Governments January 20, 2012

3. The Government People Want • Functional • Streamlined • Constantly improved • Lower- and-lower priced • Personalizeable • Not just left or right

4. Outline of Presentation • Waste is a Terrible Thing to Mind • A New Twist • An Ounce of Prevention • Talkin’ ’bout de-Regulation • Providing Some Backbone • The Life Raft

5. Waste is a Terrible Thing to Mind

6. Comprehensive Efficiency Reviews • Texas – first in the nation • $4 Billion the 1st year • National Performance Review Clinton/Gore) • $108 billion 1st year • Our experience: • Consistently 5%

7. The Basic Approach

8. The Basic Approach

9. Employ technology to fight Medicaid fraud Implement Reverse Auctions Calibrate salt spreaders to reduce road costs Eliminate most free postage for prisoners Consolidate agency mail service Combine duplicative commissions Consolidate highway pipe types Require doubled-sided printing Eliminate blank report pages Savings Examples

10. A New Twist on Human Services • 19th Century Model • “Discovery of the Asylum” • Insane Asylums • Poor Houses • Orphanages • Penitentiary • Year in the State Pen vs. Year at Penn State

11. Corrections • Divert non-violent offenders • Pretrial detention • Misdemeanor reform • Habitual-offender laws (“3 strikes”) • Alternatives to incarceration • Re-entry services • Drug treatment

12. Similar Issues: MHMR, Juvenile Services, Long-Term Care… More Effective Less Expensive Intervention arises due to crisis Overemphasis on incarceration Especially: Large facility One-size-fits-all Inattention to community/family connections Less Effective More Expensive • Prevention • Smaller facilities • Promote home- and community-based care • Individually-targeted • Aftercare • Evidence-based

13. Up Next: Education • Distance Learning Technologies • Improve outcomes • Especially for current lower-performers • Will transform role of schools, need for and use of facilities, nature of debate (e.g., vouchers, home-schooling) • Lower cost

14. An Ounce of Prevention • Government intervention usually post-hoc • Ideology • False economy • We know better • Policing • Health care

15. Proactive = Cheaper • Fall prevention • Dental checks for expecting mothers • Investment in chronic disease research

16. We Need More Research • Early Childhood Ed reduces downstream costs • What would reduce the costs of Early Childhood Ed? • Parenting Instruction? • Book Rx? • Get Parents a GED? • What’s the chicken/What’s the egg?

17. Talkin’ ’bout de-Regulation • False dichotomy: • More regulation • Less regulation • Best example (as usual): Policing

18. One Regulatory Taxonomy 15% Hostile compliers 30% Hesitant compliers 30% Clueless (‘inhabitants of the parallel universe’) 15% Spontaneous compliers 10% Industry leaders

19. Cheaper Regulatory Strategies • Performance Tier • Compliance (instead of enforcement) • Target bad actors • Netherlands • British Commonwealth • WA State • IRS • Wisconsin

20. Providing Some Backbone

21. Providing Some Backbone • “A few of the things we use the most are the ones we love the least, like Facebok, which according to ForeSee Results holds an approval rating close to that of the IRS.” BusinessWeek 8/16/10

22. Government as Backbone • Post Office • Public Apps: Package services • Private Apps: Ad/coupon packages • Public Employee Health Care Plans • Private apps on public background: • FEHBP • Connecticut municipal pool • Health exchanges? • A Counter-Intuitive: Public Pensions?

23. The Life Raft • Cut services or raise taxes? • Grandparents or grandchildren? • Public vs. Private? • ROI

24. Questions? ? ? ? ? ? ? ? ? ?

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