Congratulations to the Super Bowl Champion New Orleans Saints!
Who would have predicted after the 2005 New Orleans' Hurricane Katrina disaster that 5 years later, the long-struggling New Orleans Saints franchise would earn its first trip to the Super Bowl and then, as the underdog, came from an early 10-0 deficit to beat the Indianapolis Colts (with the best quarterback in pro football, Peyton Manning) 31-17?
The California Battle for the GOP Nomination to the US Senate
I'm intrigued by Carly Fiorina's "demon sheep" viral web video attacking a competitor, Tom Campbell, for the US Senate GOP nomination in California for Barbara Boxer's seat. The ad uses the acronym FCINO (a take-off on the well-known RINO ("Republican in Name Only")) to question former Congressman Campbell's bona fide status as a fiscal conservative.
The basic issue from a fiscal conservative standpoint is familiar to anyone whom remembers the outrage after George H.W. Bush promised "no new taxes", only to backtrack in a budget compromise which Clinton cynically turned into a campaign issue on Bush's character, thereafter raising taxes after his own election. There are basically two ways to close a budget gap: raise revenue/income or reduce expenditures. It is politically risky to do either thing, in the context of a government deficit: you raise taxes or you cut spending. [There are bureaucrats and lobbyists/special interests in Washington vested in any established program.] There are only a few times when you can do the latter, e.g., Clinton was able to cut defense spending in the aftermath of the Cold War. And as former Fed chief Alan Greenspan pointed out on today's Meet the Press, there was a Baucus amendment which passed 97-0, taking social security off the table for the proposed deficit reduction commission; how serious is deficit reduction when you take one of the biggest entitlements, rapidly approaching the point at which we'll be drawing down on reserves, off the table?
Governor Schwarzenegger knows first hand how difficult it can be to pass reform measures in California and to deal with a Democratic-controlled legislature, and there was the classic game of chicken on the budget between then President Clinton and Speaker Gingrich, when Gingrich eventually blinked given a highly unpopular government shutdown.
In fact, Tom Campbell holds a doctorate in economics from the University of Chicago, having been advised by legendary Milton Friedman; his response to critics like Fiorina: "When I was Finance Director of California, we balanced the state budget, without increases in taxes, in borrowing, or any phony accounting. In Congress, I received National Taxpayers Union, Citizens Against Government Waste, and Concord Coalition awards for holding the line of spending. Indeed, in terms of the cost of bills introduced, I was cited by the National Taxpayers Union Foundation as the single most frugal Member of the 102nd Congress." I would suggest to Carly Fiorina that she back off from personally attacking her primary opponents in a misleading way; she needs a positive campaign based on the fact that she is a change candidate, not a Washington insider, and stress her practical background as high tech chief executive, making tough decisions on budgets and meeting payrolls, streamlining a company after a merger, etc. Both Campbell and Fiorina need to make Barbara Boxer the main issue.
I am not a political consultant, but you have a number of polls over the past year where Barbara Boxer's approval ratings have been under 50%, which is problematic for any incumbent. I'm sure the candidates are analyzing Boxer-specific issues with focus groups (see my comments below). However, I think they would be well served to emulate Senator Scott Brown's strategy of posturing himself as a pragmatic conservative, deciding issues from a basis of what's important to California (e.g., the impact of an increased federal mandate of state Medicaid funding on a beleaguered state budget), focusing on the terrorism issue and linking the corrupt health care bill process to Boxer, etc. I think the GOP nominee would be able to link public discontent over the exploding national debt to Boxer, the ineffectual stimulus bill (which did not address the business side of the economy), and an ideological 2009 agenda and questionable priorities while the economy continued to lose jobs almost every month of the year. The same type progressive policies that resulted into the ongoing California state budget crisis could bring the same type of crisis to our nation's capital. We need more check and balances in Washington; and, just like Reagan famously asked in 1980, do you feel better off today than when Boxer was reelected 6 years ago?
I personally find Boxer unprofessional and unworthy of being a senator (regardless of the fact that she is wrong on virtually every public policy issue); her defensive snap at Brig. General Michael Walsh, whom was following military protocol in calling her ma'am, and her exchange with Secretary of State Condoleezza Rice, where she accused (single and childless) Rice of pursuing policies indifferent to the impact of the toll of isolated tours overseas (e.g., Afghanistan and Iraq) on military families. How can you really honor the sacrifice of American servicemen and their dependents when you undermine the legitimacy of their mission? I don't speak on behalf of all former or current military brats, but I am offended by progressive politicians using a phony concern for military families to mask ideological objections to Middle East policies. I understand that personal attacks come with the territory in politics, including ad hominem charges of hypocrisy. As a problem solver who wants more civility and bipartisanship in DC, I believe that Boxer is part of the polarization problem, not its solution.
Wolf in Sheep's Clothing? Beware Obama's "Bipartisan Deficit Reduction Committee"
My own interest in budgetary reform dates back to when I was a college student intrigued by Jimmy Carter's advocacy of zero-based budgeting. Budget increases are typically an offset of the existing fiscal year budget, e.g., a 3% increase for accounting department. The classic problem, from a management perspective, is that there is no inherent incentive to re-engineer business processes, wring out obsolete, redundant or unnecessarily high costs (e.g., don't reinvent the wheel, not invented here syndrome), reduce head count, etc. Zero-based budget applies cost analysis from the ground up, with all costs in play. A more detailed discussion of zero-based budgeting is beyond the scope of this post; I will simply note some of the limitations, including the high overhead of comprehensive cost analysis, a possible need to retrain managers, and the difficulty of analyzing qualitative benefits and certain functions like research and development.
There was an anecdote I came across in business school: A cost consultant was observing this one employee whom didn't seem to be doing anything constructive with his time. When the consultant recommended to the owner to terminate this individual, he was told that this one employee once made a suggestion that saves the client a million dollars a year.
A somewhat similar example is when I was administrating a military records application at National Archives; there were over 400 clerical employees based out of St. Louis. Every once in a while we would suffer a network interruption, which affected the user's ability to reconnect (given a process quota and unavailable old sessions occupying slots in that quota). My boss, the client manager in St. Louis, estimated one hour of downtime for the application cost the government $10,000. My predecessors had resolved the issue by restarting the database, which could take up to 20 minutes (and also affected users whom had managed to start new sessions); I devised a dynamic SQL script which got rid of the old sessions within a few seconds without any downtime. Now it can difficult to estimate the benefits of a DBA (people tend to appreciate DBA's more during those infrequent events when databases are not available), but there was a definite cost benefit from my approach versus my predecessors; it can be difficult to quantify because the network interruptions were infrequent, random events.
Now shouldn't I leap at the opportunity for a bipartisan deficit reduction committee? [In fact, I would have supported it, and I would have voted against the Baucus amendment (taking entitlements off the table) referenced in the first segment.] What about the Republicans whom voted against it? Does that mean they are voting for the status quo of trillion dollar deficits? No. There are two principal objections: (1) this is a Trojan horse proposal for tax hikes, not meaningful spending cuts (e.g., McCain); (2) this approach upsets the balance of power, limiting traditional Congressional control over the budgetary process (e.g., Cochran). That is, the commission would submit an "all-or-nothing" proposal for Congressional vote, no amendments allowed.
I am cynical about the motivations of Obama's executive order (which doesn't mean squat since there is a limit to what the President can do given the separation of powers). I think this is all smoke and mirrors to give Obama political cover (i.e., symbolically pay lip service to addressing spending and the exploding national debt) and to co-opt the political opposition. The fact is that the Democrats are in control of the Congress and the President. They can already institute significant deficit reduction without a single Republican vote (although I suspect that conservatives think like last year's nominal $17B cut, the Democrats will happen to find more things in defense to cut than domestic safety net spending); do we really expect them to cancel projects, consolidate and shut down operations, freeze hiring, etc. that they initially supported? After all, if the Democrats were really that serious about the deficit, they wouldn't have had a $1.4T deficit and brought up various taxes and fees with health care and climate change legislation in the first place.
It is not my intent in this post to outline how I would tackle the deficit, except that I think everything has to be on the table; I have a reputation for getting things done (and there's a resistance to authentic change on a personal level). Nobody likes being on a diet, nobody likes to see services curtailed or losing a government office in their district. It requires bold leadership, demanding sacrifice, which is definitely not Obama. The only sacrifice he has demanded is from those in the upper two tax brackets, whom already fund a disproportionately high percentage of the federal cost burden.
But let me start by suggesting we need to start revamping federal retirement systems (including the military and civil service), cancel replacement hires for management attrition, suspend any and all raises while unemployment remains over 5%, consider severance packages for high-earning government workers, and the federal government needs to set an example: if businesses and state/local governments have to sacrifice and live within their means (e.g., cut expenses, freeze projects and lay off people), so does the federal government. It doesn't make sense for the average federal worker to earn far more or get better benefits than the people he or she serves.
Political Cartoon
I think Chuck Asay is pointing that the progressive Democrats are in over their heads for having failed to prescribe a pro-growth solution to the ongoing recession and ignoring Republican ideas in last year's major initiatives; no doubt all that bleeding red ink from record federal deficits are attracting the sharks.
Musical Interlude: Country Pop Songs
Ricochet, "Seven Bridges Road"
Michael Martin Murphy, "What's Forever For"
Leann Rimes, "How Do I Live Without You"
