Federal Plans To 'Cut' Spending Don't Amount To Much - InformationWeek
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11/11/2010
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Rob Preston
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Federal Plans To 'Cut' Spending Don't Amount To Much

When it comes to government outlays on IT or anything else, a dollar saved is rarely ever a dollar removed from a budget and returned to a taxpayer.

We keep hearing about efforts to cut federal IT and other kinds of government spending, but they generally suffer from one of two fatal flaws. They're either so grandiose and unwieldy that they'll never get done -- witness Wednesday's bipartisan proposal to cut fed spending by $4 trillion through 2020. Or they're so small and obvious that they'll never make a difference. And no matter the size of the "efficiency" effort, when it comes to government spending, a dollar saved is rarely ever a dollar cut from a budget and returned to a taxpayer.

At the small end of the spectrum, consider the Obama administration's SAVE Award program, which calls on federal employees to submit ideas on "how to cut waste, save money, and boost performance." Fed employees submitted more than 18,000 ideas this year, and a voting process has whittled them down to these precious final four:

-- USDA inspectors ship 125,000 food samples to labs each year using next-day services. The USDA could "save a bundle" by shipping empty containers back through regular ground services rather than next day.

-- To report quarterly data, mine operators now mail paper forms to the Mine Safety and Health Administration. Filing online instead could save money, reduce errors, and make it easier to analyze the data.

-- Customs and border protection officials now post notices of seized property in newspapers. They could do that online instead.

-- Certain government employees need access to Federal Registers. Forcing them to opt in for hard copies (and by default have to access that information online) would reduce the mailing of thousands of registers.

And those are the finalists? "Make no mistake: the SAVE Award will not balance the budget," says the Office of Management and Budget's SAVE Award blog. No kidding.

At the other end of the government cost-cutting spectrum comes a proposal from the Technology CEO Council, a group that includes IBM's Sam Palmisano and Dell's Michael Dell. The council says its plan could save the federal government $1 trillion over the next decade -- $500 billion by consolidating its multiple supply chains, $200 billion by automating more processes (Medicare, IRS, etc.), and $300 billion by consolidating other systems and using technology to make better decisions and reduce fraud.

In an essay published in October on Politico.com, Palmisano and Dell argued that the council's plan "is not just theory. We've seen both the cost savings and the innovation that these approaches can unleash -- in both the private and public sectors." How nice that the savings they project add up to a fat, round $1 trillion -- with little underlying detail provided. I wonder if their CFOs are as loose with the numbers.

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