In the many debates about whether the federal stimulus bill will, indeed, stimulate the economy or merely increase government spending, there is agreement on one issue. To offer any stimulative effect to the increasing economic malaise, the spending needs to be swift and economically strategic.
Consider to whom this task of rapidly spending almost a trillion dollars of taxpayers’ money goes: massive, chronically inefficient, and slow-moving federal bureaucracies. The scale of the purely administrative task is unprecedented. The entire plan hinges on unwieldy bureaucracies turning on a dime to approve contracts and grants.
Consider the scale of the challenge for only one agency: Department of Energy (DOE). This agency’s total annual budget is now $25 billion. The portion of the stimulus bill going to DOE is $40 billion. Among federal agencies, DOE is known for exceptional delays and cost overruns. The Government Accounting Office has DOE on its “high risk” list for waste, fraud, and mismanagement. Most of DOE’s current budget goes to oversight of the nation’s nuclear stockpile and research. Now it is to be a shrewd money manager.
The new Secretary of the Department, Nobel Prize winning physicist Steven Chu, recognizes the stakes of DOE’s new challenge. He was recently quoted as saying its new role necessitates a radical transformation of the agency. “We’ve got to do it. Otherwise it’s just going to be a bust,” he recently commented. Not comforting!
Hell, in fact, will freeze over before huge government bureaucracies act quickly, decisively, and prudently as wise investors of taxpayers’ money. Giving these bureaucracies billions with the directive to spend fast is a recipe for waste at best and fraud at worst, whereas tax reduction is immediately stimulative and requires no “assistance” from bureaucracies.
– Kathleen Hartnett White