Bureaucracies and Implementation

An article in Politico details the slow progress of the implementation of the Dodd-Frank financial reform bill. According to the article, federal agencies have missed 77% of the rule-making deadlines outlined in the bill. The reasons for this delay are numerous, including partisan opposition, as Senate Republicans are blocking the nomination of the head of the new Consumer Financial Bureau. Republicans counter this obstructionist charge, claiming instead that, "regulators are simply unable to write regulations from the law in a timely or effective way." The article also argues that the complexities and magnitude of the financial industry are too significant for bureaucracies to address. Sounds like a prime example of the need for bureaucratic reform Kamarck writes about.

Bureaucracy and Reform

Pinkerton's "Bugs" in the Bureaucracy

• The Peter Principle
• Parkinson's Law
• Michels's Iron Law of Oligarchy
• Olson's Sclerosis
• Information Infarction

Reform

• Reinvented Government, operating more like a business, with performance measures
• Government by Network, contracting out the work.
• Government by Market, creating a market driver to change the behavior of a large group or people, e.g. putting a bounty on cans and bottles.

Reinvention video here and here.

More on reinvented government

• Productivity
• Service delivery
• Performance measurement
• Regulatory reform
• Innovation

Lasting Impacts of Prop 13

The issue of property taxes in California and how they should be allocated has been an ongoing fight and was on full display in Claremont. On Friday, representatives for the state and redevelopment agencies met in Claremont to discuss the allocation of property taxes to redevelopment agencies. The California Legislature passed two bills for the 2011-12 fiscal year, one which “eliminates redevelopment agencies altogether, but allows cities to continue some form of redevelopment agency or go without,” and another which “forms an alternate redevelopment agency for cities that decide to continue with redevelopment. However, they will be required to pay 40 percent of its revenue to the state.”
The constitutionality of both bills is being challenged in the California Supreme Court starting November 10, but the most relevant part of this story to the class is this example of an unintended consequence of Proposition 13 and other California tax laws. Prior to these two bills, the reallocation of property taxes to redevelopment agencies “cost the state $2 billion annually to backfill the loss of property tax to schools.” Prop 13 greatly reduced property taxes that residents had to pay, which at the same time reduced the amount of money available to local schools. Due to other previous California laws, the state has had to pay for education from general fund, which would normally be paid for by property taxes. Marianne O'Malley with the Legislative Analyst's Office said that, “Every dollar redevelopment redirected from schools is a dollar that the state has to dip into the general fund to provide to local school districts,”
Overall the long lasting impacts of Prop 13 and other tax related laws are currently causing problems for California and have been magnified by the economic difficulties facing the state. Less property taxes plus property tax revenue being diverted to redevelopment agencies equals less local money for education, causing the state to cover more of the costs. For the full article on the Claremont discussion here is the link http://www.sgvtribune.com/news/ci_19218133

Why School Board Elections Matter

Evaluation and Reform

Law school, grad school, or policy school?

A crisis of confidence

Evaluation

Remember what Wolf wrote: "First, the `products' of non-market activities are usually hard to define in principle, ill-defined in practice, and extremely difficult to measure independently of the inputs which produce them."

Inputs v. outputs v. outcomes

Efficiency v. effectiveness

The examples of education and special education

Reform

• Reinvented Government, operating more like a business, with performance measures
• Government by Network, contracting out the work.
• Government by Market, creating a market driver to change the behavior of a large group or people, eg. putting a bounty on cans and bottles.

Budgets

Some distinctions:

• Fiscal policy v. monetary policy
• Authorization v. appropriation
• Budget authority v. outlay
• Mandatory spending v. discretionary spending
• Budget process v. appropriations process

Revenues and Outlays

Deficits

Debt

Composition of Outlays

TABLES

Fun with Historical Tables! Defense Outlays as

.....................................................FY1985.....FY2010

Nominal Dollar...........................252.7b........693.6b
Constant (2005) Dollars...........421.0b........585.9b
Percentage of Outlays...............26.7%..........20.1%
Percentage of GDP.......................6.1%............4.8%

Impractical Policy Making

On Saturday, I attended a discussion with Tom Leppert, a CMC
alum who is running for Senate in Texas. He spoke about why he’s running, what
his goals are, and what his political positions are. One that struck me in
particular was his strong stance against the DREAM Act. The DREAM Act helps
students who are illegal immigrants attend college. He opposed it mainly
because it ignored the “big picture” idea of tackling the immigration issue. He
described that the DREAM Act addresses only a small portion of the immigration
question and that policy must be made by looking at and addressing overall
problems.

This brings up the questions: Should policy making address
short-term issues along with long-term issues? Can politicians address subsets
of issues to make progress without looking at the issue as a whole?

Ideally, all policy making would be comprehensive. However,
politicians must constantly consider not just what would be ideal but what
practically they can accomplish. With our fiercely divided two-party system, it
seems impractical to believe that action should only be taken with the big
picture in mind. Children of illegal immigrants brought here when they were
young hold no responsibility for the decision to illegally immigrate. Waiting
for a broader solution by not taking action for students directly hurts them. Furthermore, though unintended consequences
exist for the DREAM Act, so many more would exist for large-scale immigration
reform. The process for such passage and the amount of changes that would have
to be made after passage due to these unintended consequences will be
incredibly lengthy. In our system, incremental change works best.