Duh Headline Of The Day

Steven Greenhut: The front page of the LAT Extra section of the Los Angeles Times featured the “dog bites man” story of the day: “Child agency wasted funds, audit reports.” [Note that the online headline differs from the one in the print edition.] Really, there’s nothing at all wrong with this story. It’s quite good, as it details how “A quarter of the money spent last year on cellphones by Los Angeles County’s child welfare department was wasted on ‘unnecessary or inappropriate’ charges … .” That agency has for many years been plagued with problems, many 0f which involve life-and-death situations. Yet this story struck me because that headline could run every day. This isn’t news, but is standard operating procedure at this agency. And at every other government agency known to mankind. The Times ought to have a standing headline with a fill-in-the-blank as a first word: “_______ agency wasted funds.”

Yet the first solution virtually everyone offers these days for any problem is to create a government program or fund an existing one. Bureaucracies don’t fix things, though. They are inherently wasteful and abusive. Private companies relentless root out waste and increase efficiency to enhance the bottom line and to stave off bankruptcy. In fact, as Jack Stewart of the indispensable California Manufacturers & Technology Association told me this week in regards to the state’s loss of manufacturing jobs, California businesses are the most efficient in the country. They have to be — all the regulations and high costs make it necessary for them to be efficient or else they go out of business. The only thing left to cut is personnel, which in part explains the state’s high unemployment rate. But businesses have to be efficient or they go away.

Agencies have no incentive to be efficient. They never go away. When they misspend their money, they take more. It’s a perverse incentive. Waste and fraud cannot be rooted out of the system, even though it’s great to have audits and to spotlight problems and make reforms. But government money comes without serious accountability. That’s the nature of it. There are no customers. There is no profit motive, although agency employees, contractors and consultants profit mightily from the system. That’s why government should be limited to a small number of functions that could not otherwise be provided by the private sector.

DEC. 22