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Show Orem-Geneva Times- -Wednesday, April 11,. 1984 Government Waste In The U.S. In February of 1982 President Reagan asked W. H. Grace an industrialist in-dustrialist to study the government waste in the United Sates. According to the January issue of the Reader's Digest the waste that the Grace Committee uncovered was both sickening and disgusting to the average taxpayer. It made the average man wonder just what kind of people work for our government. It also makes it plain that the government govern-ment is in deep trouble, so deep that no human being is going to be able to untagle it. The Democrats, Republicans or whoever is in the White House just becomes entwined, and are soon doing worse than their predecessor. According to Mr. Grace his 1350 man committee investigated in-vestigated about two years and just hit the tip of the iceberg. It is no wonder the government is broke when the public stands idly by and lets such tactics go on year after year. Following are a few of the hundreds hun-dreds of cases of mismanagement that is going on in our government , that was published in the Reader's Digest, January issue. Why, the businessmen asked, is spending so out of control? Peter Grace's bloodhounds closed in on three prime factors: the "information "infor-mation gap," built-in disincentives to economize, and Congressional meddling. Consider: 1. The "information gap." "The government is loaded with data," explains J. P. Bolduc, the survey's chief-operating officer, "but it has no information. You want to know how many offices there are in the federal government? Nobody knows. How can you begin to cut your overhead when you don't know what it is?" The volunteers discovered that no one knows how many people are fed by federal programs. No one can say how many counsultants the Pentagon Pen-tagon has hired, or whether their projects have ever been studied before. No one knows the number of federal employees by department and agency in each state. Where numbers are collected, they often aren't processed adequately. The government has more than 19,000 computers, but .nost are old and incompatible; they can't "talk" to one another. The Navy, for example, has sophisticated computers on its ships and planes, but uses out-of-date ones to run its business systems. Result: it doesn't always know what's in inventory in-ventory or even where that inventory inven-tory is stored. i Finally, gVen wheridata are 'processed adequately, they're not utilized. In 1981 Medicare officials received word that some 8000 patients patien-ts on thr rolls had died. Yet they received word that some 8000 patients on their rolls had died. Yet they didn't inform Social Security, which continued to send checks to the deceased. The results of this information gap are duplication and waste. For example, the government spends $4.6 billion to move freight every years, but it can't always negotiate discounts with shippers because no centralized data exist. An automated auto-mated freight-management system could save as much as $530 million over three years. 2. Disincentives to economize. In 1967 the Atomic Energy Commission became the first government agency to use word processors. Secretaries vied to learn how to use the new machines, and productivity soared. Then, in 1979, the Office of Personnel Management decreed that operators of word processors didn't possess as many skills as the average secretary (shorthand, dealing with people, etc.). Therefore, they should receive $3000 less per year. Word-processing Word-processing centers shut down for lack of applicants, operators became "secretaries" again, and productivity plummeted for several years. Although recent improvements im-provements have been made, the government still owns an estimated $100 million worth of word processors that aren't used effectively. effec-tively. Grace volunteers found examples exam-ples of such costly disincentives lurking everywhere. Retirement pay for military personnel is at least six times as generous as the best private-sector plan. In the Civil Service, Ser-vice, between 1977 and 1981, automatic cost-of-living adjustments adjust-ments caused pensions to balloon by 55 percent. Result: a mass exodus of experienced personnel. In 1979 only 20 percent of eligible federal executives chose to retire. By 1980 the figure had jumped to 65 percent. Of the Pentagon's $240 billion budget, $94 billion goes for weapons systems, and another $13 billion is spent on spare parts. How much waste is involved? Plenty, the businessmen found. The Air Force, for examples, will decide to procure 100 jet fighters over the next five years, but order them one year at a time. If we scrapped single-year procurement, with lower unit costs, savings from the Air Force alone could total $2.4 billion over three years. Grace volunteers also found that individual government agencies have no incentive to manage their cash efficiently. As for collecting debts, the sums they acquire go directly to the U.S. Treasurey, and the agencies themselves are not rewarded for performing well. In fact, the reverse is true: if agencies spend less, their budgets often are cut. So why bother? The Department of Housing and Urban Development, for example, lists delinquent loans totaling $1.6 billion. How hard does it try to collect? HUD employees average three calls a year on each delinquent account and report only 15- to 20-percent 20-percent success. The average private collector makes 24 to 36 contacts con-tacts per year and has a success rate of 80 to 85 percent. If HUD had an incentive, in-centive, the businessmen concluded, con-cluded, it could realize extra revenues of at least $95 million per year. 3. Congressional meddling. Congress actually prevents government gover-nment managers from doing their jobs this was the final sweeping conclusion of the Grace volunteers. As Bill McCaffrey, a vice president of Equitable Life, summed it up: "What disappointed us most is the awesome authority of Congress to destroy management initiative." For example, the Department of Defense maintains 4000 bases throughout the continental United States. Only 312 are considered vital to national security; the rest are either support facilities with fewer than 150 employees each or National Guard and Reserve installations. But any time the department wants to save money by shutting down a base, Congress won't hear of it. "Congressional barriers render it almost impossible to close unneeded military bases," the volunteers reported. "Yet the cost of main taining them ranges from $2 billion to $5 billion annually." (Ft. Douglas is an example.) In 1982 the General Services Administration announced that it would hire private firms to provide maintenance and security services at federal ofices throughout the United States. The action, GSA claimed, would cut costs in half. Up jumped Rep. Bob Edgar (D-Pa.), who charged that veterans' job opportunities oppor-tunities would be in jeopardy. Result: an Edgar amendment to prohibit the cost-cutting move. It passed overwhelmingly. For several years, the Office of Management and Budget has tried to encourage government agencies to "contract out" when the private sector can provide cheaper service. The government could save $474 million per year by 1986, OMB determined, if it "privatized" such tasks as food service, firefighting, maintenance, laundry and security. But Congress has resisted. In August, 1982, the lawmakers even barred the Defense Department from funding studies that might show the private sector could do a better job! What can be done to narrow the information gap, remove the disincentives disin-centives to efficiency and presuade Congress to stop blocking economies? Already, departments are signaling that they concur with the Grace Commission finding. At the Department of Education, officials of-ficials sent warning letters to 46,860 government employees delinquent in repaying federally guaranteed college loans, threatening to withhold money from their salaries. To date they have received some 9000 replies - and more than $4 million. Last August, Defense mm This photo of the Oregon coast won an Honor Award of a $25 Kodak Gift Certificate Cer-tificate for Chris Evans Keller, Orem, in the 1983 Scout Photo Scholarship Awards, Explorer Ex-plorer Division, sponsored by Eastman Kodak Company. Keller is a member of Post No. 181. He is the son of Alan and Selena Keller, 1635 S. 350 E., Orem. Secretary Casper W. Weinberger announced a ten-point plan to revamp Pentagon procedures for purchasing spare parts, including more competitive bidding. But such changes are generating fierce opposition from lawmakers on Capitol Hill, as well as special-interest groups and bureaucrats who prefer the status quo. Rep. William D. Ford (D.Mich.), (D.-Mich.), chairman of the House Post Office and Civil Service Committee, called the report on employee benefits "statistical chicanery." Grace, however, is unfazed. "When you stick a pig, it screams," he says. "The people who get stuck here are going to scream a lot louder than the general public, who would be benefited." Of the 2287 recommendations in the Grace reports, roughly 40 percent per-cent can be implemented by the President or by agency and department depart-ment heads. All are bing reviewed by the White House and OMB, and some are being put into place right now. The remaining 60 percent will need Congressional approval, and with an election approaching this year, the chances of that happening are remote. This is where the President himself him-self can help. As the Wall Stree Journal noted recently: "If the President intends to go to the mat with Congress over the budget, he can help his cause by giving evidence eviden-ce that he will use the Grace findings. fin-dings. To do so would demonstrate that at least one man in Washington is serious about the problems uncontrolled uncon-trolled federal spending are creating for the country." tew i wrnfi If "'" " " "- J ' -'"--' i I l S i ' t ij N n y 4 II I SlllliillSIII i ? iiillSlllilljiiiiillliiliilli ! - - yf , r r-- v , : A-S H ..l'... ' : an an IRA at First Interstate Bank Every year millions of taxpayers throw their money away by not taking advantage of a tax break both encouraged and endorsed by Congress. 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