The federal government has been attempting to correct the massive financial issues facing the United States via a massive jolt of spending for the better part of a year now. When taking a macro view of this solution it can seem to make sense from a distance. By taking over the role of the engine of economy the government hopes to keep the wheels spinning until the normal engine (business) recovers and resumes the role it holds.
However, because the government by its very nature does not need to take into account profitability there are factors that come into play which reduce the effectiveness of the intended jolt. From my perspective, which is one of a person that deals with government agencies on a daily basis, the results would be comical if not so serious. A very good example of this happening on a micro level can be found in the following article by Andrew Malcolm of the LA Times. In the article Mr. Malcolm describes a $5 billion (that’s $5,000,000,000.00) dollars that are devoted to creating 90,000 jobs dedicated to weatherize homes. It sounds like such a great idea. We will employ people and save energy costs in the future. Indeed from a macro point of view it sounds like a wonderful investment of that huge sum of money. In fact, the initial estimate from the current administration called for over 80,000 of the jobs would be created in the first year of the program. Those new workers would in turn weather proof over half a million homes in the first year. Sounds so simple right?
The micro reality however is that the GAO (general accountability office) has found that only 9,000 homes has taken part of the program despite the fact that $522 million ($522,000,000.00) dollars from the program have already been spent. Why the hold up? Simple, the government forgot to plan for…the government. From the article:
The Energy Department is run by Steven Chu, like President Obama a Nobel Prize winner. You’ll never guess what the federal government blames for the lack of significant progress.
RED tape.
Not duct tape. Not weather stripping. But that infamous RED tape. In the form of, well, forms.
It seems that the Pelosi-Reid stimulus plan that was so quickly cobbled together and was supposed to immediately pump so much money into the sagging economy last year included an 80-year-old legal provision requiring all federally funded projects to pay a prevailing wage to workers.
But what’s a prevailing wage for weatherization, you ask?
Who knows?
So the Energy Department asked the Labor Department, which set out to calculate what a prevailing weatherization wage is in every single one of the more than 3,000 counties across these United States.
There were some other things to figure out. It seems the law also requires some kind of National Trust for Historic Preservation review for most homes before any contracts could be estimated to be negotiated to be signed to be let to be begun. And states like Michigan have two people assigned to such tasks.
So, good luck speeding up that work.
Ask any contractor that has to deal with local, state or federal government about getting anything done quickly with their involvement. Projects that would take our company six months to complete five years ago now take upwards of 14 months to finish. It is only getting worse. Every aspect of the construction process has more steps now that result in more delays. Any project that has federal funds tied to it now requires that bidding contractors contact disadvantaged businesses in their state to make them aware of the bid. This involves faxing out a form letter not once but twice to every business that appears on a web site search engine provided by the State. More paper, more steps, more time.
Whether or not there is an efficient government run program that spends the public funds wisely is open to debate. That much of our tax dollars are currently wasted is not. The solution, and what it might be is the real question. Let’s all hope the person with the solution arrives soon.