PRESIDENT OBAMA called for “smarter government” in his State
of the Union address. But Congress is about to enact $85 billion in
across-the-board budget cuts that could be called “dumber government.”
The so-called sequester is the latest fiasco as the country
lurches from one budget crisis to the next. It would force government agencies
to cut the biggest, most visible items in the budget, like the size of the Army.
It would also cut long-term investments in people and research — canceling
summer internships, new student hires, and training programs for federal
employees. But the sequester won’t do anything to attack the real waste and
inefficiency in government programs.
That’s because the national budget process has become
completely dysfunctional. The executive branch undergoes an annual farce in
which government officials prepare detailed estimates of how much it will cost
to run their organizations. Congress ignores most of this effort, and instead,
tapes together budgets based on the previous year’s spending. Federal agencies
also conduct an elaborate process to evaluate how well they are performing. But
Congress provides money almost regardless of the evaluation. To get around
budget caps, which are supposed to limit the amount of spending each year,
Congress uses a number of tricks. For example, it has appropriated trillions
for the wars in Iraq and Afghanistan in more than 30 “emergency” supplemental
funding bills, even though this mechanism is supposed to be used for events
like Hurricane Sandy.
Worst of all, it’s impossible to keep track of what our tax
revenue really buys. Federal accounting systems provide no management
information and are unsuited to make decisions based on efficiency. Most agency
budgets are simply long itemized lists of salaries and expenses. You can drill
down to the cost of a pencil, but there is no mechanism for calculating costs
by the type of service delivered, such as the cost of processing veterans’
benefits.
The so-called sequester won’t do anything to attack the real
waste and inefficiency in government programs. That’s because the national
budget process has become completely dysfunctional. The lack of a functional
budget and absence of financial information has lowered the quality and
increased the cost of federal government services almost across the board.
Federal agencies operate in a fog of uncertainty, unsure how much money they
will have for next year — or even next month. This short-termism also plays
right into the hands of private contractors. Government agencies don’t have the
leverage to negotiate long-term deals, so they rush to disburse unspent money
in the last two weeks of the year. The interruptions in funding delay routine
maintenance for roads, buildings, and equipment. They undermine employee
morale, retention, hiring, and training.
Until every citizen takes the responsibility to notify their
representatives in Washington this must end, it will never end. It could be
a long 2013.
FROM
THE 70-PAGE SEQUESTRATION ORDER that went out late Friday:
"The law requires the president to issue a sequestration order today
canceling $85 billion in budgetary resources across the federal government for
FY 2013. Specifically, OMB calculates that, over the course of the fiscal year,
the sequestration requires a 7.8 percent reduction in nonexempt defense discretionary
funding and a 5 percent reduction in nonexempt nondefense discretionary
funding. The sequestration also requires reductions of 2 percent to Medicare,
5.1 percent to other nonexempt nondefense mandatory programs, and 7.9 percent
to nonexempt defense mandatory programs."
GREENWATCH! - "Australian climate on 'steroids' after hottest summer: The
Bureau of Meteorology has confirmed the three summer months ending February 28
were the hottest season ever recorded in Australia, leading the government's
Climate Commission to label it the 'Angry Summer' ... 'The Australian summer
over 2012 and 2013 has been defined by extreme weather events across much of
the continent, including record-breaking heat, severe bushfires, extreme
rainfall and damaging flooding,' the report said. ... Australia experienced its
hottest ever average national maximum temperature on January 7 of ... 104.5
Fahrenheit, while 44 sites, including Sydney and Hobart, recorded all-time high
temperatures in the summer. The report said there have only been 21 days in 102
years where the average maximum temperature for the whole of Australia has
exceeded [102.2 F] and eight of these happened in the summer just gone."
SIREN: CHINESE ARMY TIED TO CYBERATTACKS - "On the outskirts of Shanghai, in a run-down
neighborhood dominated by a 12-story white office tower, sits a People's
Liberation Army base for China's growing corps of cyberwarriors. The building ...
is the headquarters of P.L.A. Unit 61398. A growing body of digital forensic
evidence ... confirmed by American intelligence officials ... leaves little
doubt that an overwhelming percentage of the attacks on American corporations,
organizations and government agencies originate in and around the white tower.
"An unusually detailed 60-page study, to
be released Tuesday by Mandiant, an American computer security firm, tracks for
the first time individual members of the most sophisticated of the Chinese hacking
groups ... to the doorstep of the military unit's headquarters. The firm was
not able to place the hackers inside the 12-story building but makes a case
there is no other plausible explanation for why so many attacks come out of one
comparatively small area."
PROFITS UP; JOBS NOT - "With the
Dow Jones industrial average flirting with a record high, the split between
American workers and the companies that employ them is widening and could worsen
in the next few months as federal cuts take hold. ... With millions still out
of work, companies face little pressure to raise salaries, while productivity
gains allow them to increase sales without adding workers. ... The result has
been a golden age for corporate profits, especially among multinational giants
that are also benefiting from faster growth in emerging economies like China
and India."
CITIZEN GEITHNER: Beginning in
early March, former Treasury Tim Geithner will conduct a series of university
seminars on financial crises - all closed to press and off the record and done
for no fee. The focus of the seminars will be on advancing academic research on
crisis prevention -- and the craft of crisis response - so that future policy
makers can draw on his ideas, and the public can use to better understand how
and why governments act in crisis. Geithner has committed to do such sessions
at Harvard, MIT, Northwestern, Princeton, and the University of Michigan.
Additional schools will be added in the coming months.
"Geithner has retained the Harry Walker
Agency to represent him in handling his paid speaking engagements. Beyond the
university seminars and the paid speeches, he also expects to do some
engagements for nonprofit organizations and charities for no fee.
2016 WATCH - Marco Rubio courts Wall
Street: The rising GOP star ... has quietly met with some of the most powerful
GOP backers in the world of high finance. The roster includes Blackstone Chief
Executive Stephen Schwarzman, KKR CEO Henry Kravis and senior executives at
Goldman Sachs and Barclays Capital ... Rubio has gotten backing from big Wall
Street titans before, notably hedge fund manager and billionaire Paul Singer.
... 'It was a first date. And he's doing lot of them,' said a person familiar
with Rubio's meeting with Schwarzman, who heads one of the biggest private
equity firms on Wall Street. The person ... said Schwarzman was 'favorably
impressed' with Rubio but remains uncommitted for 2016. 'Rubio has a very
strong sense of himself and positioned himself very early on immigration
reform, which Republicans desperately need,' this person said. ...
"Sen. Rand Paul was in New York City on
Monday, meeting privately with a range of donors and political operatives
before an appearance at the New York Meeting, a conservative gathering in
Midtown where candidates have a chance to network. Rep. Paul Ryan of Wisconsin
is expected [in NYC] in the coming weeks ... Ohio Sen. Rob Portman, in his role
at the National Republican Senatorial Committee, has also been in New York
meeting with donors. And Louisiana Gov. Bobby Jindal is due here for a
Republican Governors Association fundraiser in a few weeks."
BIRTHDAYS
THIS WEEK – Birthday wishes and thoughts this week to: Melissa
Duran …famous San Jose Shark fan, Alan Greenspan (87), Jim Rice (60), Sharon
Stone (55, Shannon Tweed (56), Carrie Underwood (30).
AUTO
BUFFS – The anticipated introduction of the new 2014 Corvette
Stingray convertible will be released this Tuesday at the Geneva Switzerland
Auto Show.
The drop-top model shares the dramatic body styling of the
coupe, but with a folding fabric top. Underneath its skin is the new Chevy LT1
6.2 liter V-8 with 450-hp. No word yet
on pricing or availability.
COLLEGE
HOCKEY PICK OF THE WEEK – Friday March 8, 7:00 PM, ET, HGTV; the ECAC
playoffs begin with a first round matchup in Canton, New York. Colgate
University Raider’s (14-16-4) vs. St. Lawrence University Saints (16-14-4). St.
Lawrence is the higher seed but will be in trouble without their captain,
senior Kyle Flanagan. St. Lawrence has lost three in a row without their star.
Still we like the Saints to win Game 1 of the best of three series, 3 – 1. (Season
to date (7-3)
THE
SWAMI’S TOP PICKS: ice –
(ECAC) St. Lawrence 3 Colgate 1, (NHL) Boston 5 Toronto 3, hoops – (Big East)
Georgetown 75 Syracuse 70. Season
to date (59-30)
DRIVING
THE WEEK - President Barack Obama holds a Cabinet meeting this
afternoon ... House this week is expected to vote on a bill to fund the
government through September (more on which below) ... ISM nonmanufacturing on
Tuesday at 10 a.m. EST expected to dip slightly to 55 from 55.2 ... ADP
employment on Wednesday at 8:15 a.m. expected to decline to 170K from 192K ...
Initial jobless claims at 8:30 a.m. Thursday expected to rise to 355K from 344K
... BLS jobs report on Friday at 8:30 a.m. expected to show a gain of 160K with
no change to the 7.9 percent jobless rate.
Senate Banking has a hearing on Thursday at 10 a.m. on the
Bank Secrecy Act ... House Financial Services has a hearing Tuesday at 10 a.m.
reviewing current monetary policy and Wednesday at 10 a.m. on GSE reform.
Next week; movie, book reviews and Dear Rink Rats.
Until Next Monday, Adios!
Claremont, CA
March 4, 2013
#III-46, 151
No comments:
Post a Comment