Just how many boxes did Arnold blow up?

By ANTHONY PIGNATARO

The promise was to do nothing less than “blow up” the boxes of government. “We cannot afford waste and fraud in any department or agency,” Gov. Arnold Schwarzenegger famously said in his January 2004 State of the State Address. “Every governor proposes moving boxes around to reorganize government. I don’t want to move boxes around; I want to blow them up. The executive branch of this government is a mastodon frozen in time and about as responsive. This is not the fault of our public servants but of the system… I plan a total review of government – its performance, its practices, its cost.”

What ultimately became of Schwarzenegger’s plan to completely remake the way state government works – later given physical form in the gigantic, $9 million California Performance Review – is one of the great puzzles of his administration. Released with such fanfare and expectation, full of suggestions to do away with more than a hundred state boards and commissions as well as eliminate all sorts of duplication, the CPR just went away. In fact, exactly how many CPR recommendations went into use – and the extent of government savings they brought about – is all but impossible to say.

“You’re not the first person to ask me what happened to California Performance Review,” William Hauck, president of the California Business Roundtable and former co-chairman of the CPR Commission, said. “The administration chose not to do centralized tracking of CPR recommendations, despite a commission recommendation to establish one. A lot of the recommendations were good ones. It’s unfortunate that it’s not possible to track their implementation.”

In fact, some of the CPR has actually been implemented, though finding out exactly what, and its effect on state operations, was difficult.

One of the most amazing things about CPR is just how fast it came together. In just eight months, a group of 275 state employees, aides to Schwarzenegger and outside consultants produced the document. Even by government standards, it was a monster of a document: 2,500 pages spread throughout four volumes, detailing 1,200 individual recommendations. And it pulled no punches on the stakes at hand.

“Today, California state government faces an unprecedented financial crisis,” the report’s conclusion stated. “This information is neither new, nor surprising to anyone who has paid attention to the state’s worsening financial situation.”

In fact, the budget situation described in the CPR report doesn’t actually seem all that bad these days: “The state’s ending General Fund balance has decreased by $11.4 billion, from $3.9 billion at the end of FY 1998-1999 to a (negative) -$7.5 billion at the end of FY 2002-2003.” Considering that in November 2009 the state Legislative Analyst’s Office reported “a $6.3 billion projected deficit for 2009-10 and a $14.4 billion gap between projected revenue and spending in 2010-11” – $20.7 billion in total deficits – those seem like good days indeed.

The CPR was supposed to change all that and show how state government could be made more efficient, rational, even intelligent. Make it more responsive to the public and more up-to-date in its operations. And, as a bonus, implementing the CPR recommendations was to save the state $32 billion over a five-year period.

At the time of the Review’s August 2004 release, a Field Poll showed 74 percent of voters approved of the plan. Schwarzenegger promised immediate action. “The people know that California needs many, many reforms: prison reform, energy reform, government reform, education reform,” he said, according to an Aug. 4, 2004 Los Angeles Times story. “We are going to meet all those challenges and much more.”

Things didn’t quite work out that way. The Legislative Analyst’s Office tossed a serious monkey wrench into works in late August 2004, when CPR was not even a month old. Though the LAO found that “many of its [CPR’s] individual recommendations would move California toward a more efficient, effective, and accountable government,” the office also reported that the $32 billion in savings figure was wildly inflated.

“[W]e believe that a more realistic savings assumption attributable to state actions would be less than one-half of the $32 billion shown,” the LAO reported. “While any estimate of savings is highly uncertain, we believe that a more reasonable cumulative estimate for all funds over the next five years would be roughly $10 billion to $15 billion.”

Of course, even $10 billion in savings would have been laudable. Indeed, the LAO added that, “Our lower overall savings estimate does not make the goals or proposals offered by the CPR any less valid. The state would clearly benefit from changes that enhance workforce productivity, improve and streamline services, and reduce inefficiencies in government – even if the savings were only a fraction of the CPR estimates.”

In late 2004, the CPR Commission held eight all-day hearings across the state on the CPR. The whole operation immediately came under fire. Both Public Citizen and the League of Women Voters criticized the report’s writers for working in secret. “The report was researched and written without meaningful public participation,” Public Citizen dryly told the CPR Commission on Sept. 30, 2004. The same day, Jacqueline Jacobberger of the League of Women Voters told the commission that her organization felt “the commission’s hearings began so soon after release of the report and have been held over such a short period that there has been little time for study and comment on the proposals.”

Though the commission itself largely agreed with the report’s recommendations, there were some notable exceptions. In their November 2004 publication The Commission’s Perspective, commissioners explicitly rejected the CPR’s call to transfer Emergency Management Services away from Health and Human Services to a new Public Safety Department. Like the call for a central CPR tracking office, state officials ultimately ignored the commission’s wishes and, in 2009, created the new Cal-EMA department.

To find out whatever actually became of the old CPR, former commission chairs Hauck and Joanne Kozberg suggested checking with individual departments as to what aspects of CPR were actually put into practice. But a few calls to department press offices – such as the Department of General Services, which supposedly saved more than a hundred million dollars by implementing CPR recommendations – were simply referred to the governor’s press office. Indeed, that office couldn’t even provide a hard-copy of the actual CPR report, suggesting instead that we just read it online. Cynthia Bryant, the governor’s Director of Planning and Research and current point person on CPR, didn’t return two phone calls for comment.

In any case, a cherry-picking, cursory survey of the CPR’s thousand-plus suggestions revealed a mix bag of what did and didn’t make it into state government. Recommendation SO 01, calling for the appointment of a “State Chief Technology Officer,” went into effect in 2005. But it’s possible that since CPR officials said the state wouldn’t save anything by eliminating the apparently useless Registered Environmental Assessor Program (“a largely clerical program that provides little public value or environmental protection”), the office still exists today.

Then there’s Recommendation ETV 11, which asked the state to “Change the California Education Code specifying that a student be five years of age prior to December 2 in order to enter kindergarten to September 1,” never went anywhere. Though CPR officials estimated that making this change would save the state $2.7 billion over five years (the LAO didn’t dispute this estimate), state officials never made the change. “Doing so would have required action by the legislature,” Pam Slater, public information officer for the Department of Education, said.

A few CPR recommendations finally went into effect last year, as part of “The Governor’s Roadmap For More Efficient Government.” This plan, announced on January 16, 2009, called for just 18 changes in government operations, all of which traced their lineage back to the CPR. One recommendation, “Consolidate the Board of Geologists and the Geophysicists to the State Mining and Geology Board” – which would save a theoretical $714,000 (up from $449,000 six years ago) – was eventually carried out in October 2009, though the geology boards actually folded into the Board for Professional Engineers & Land Surveyors. Other recommendations to eliminate the Department of Boating and Waterways, Integrated Waste Management Board, Court Reporters Board, Inspection and Maintenance Review Committee, Landscape Architects Technical Committee as well as the Bureau of Naturopathic Medicine went nowhere.

Then there’s the issue CPR brought up concerning “plain language.” Because “Californians do not trust a government that does not communicate clearly,” Recommendation GG 16 asks the state to “Establish a plain language advocate and require state agencies to conform with [sic] the principles of plain language.” Though CPR listed no potential cost savings estimated for creating such a position, and proper grammar requires “to” in the quote instead of “with,” we probably shouldn’t doubt the recommendation’s sincerity.

But by far the most curious recommendation – and the most expensive, as it turned out – is one of the last. Recommendation SO 45 said simply, “Hire the best of the best.”

“The state should implement a number of changes in its personnel system to hire and retain the ‘best and brightest,’ the CPR noted before detailing eight ways, like “provide more guidance and training to department staff,” state officials could theoretically do that. Over a five year period, carrying out such hiring practices would apparently cost the state nearly $12 billion.

Given the current state of the state, anyone want to guess whether this one was put into practice?

3 comments

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  1. John Seiler
    John Seiler 5 January, 2010, 19:57

    “The Best and Brightest.” Apparently the CPR guys didn’t realize that the best known modern meaning of that phrase is the title of David Halberstam’s 1972 book about McNamara, McGeorge Bundy, Westmoreland, Rusk, Rostow and the other geniuses who plunged America into the Vietnam quagmire.

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  2. Rob Gordon
    Rob Gordon 6 January, 2010, 19:22

    As someone who seven years ago might have once been called a “Schwarzenegger Democrat”, I can’t express how disappointed I have been with his administration. In the case of the California Performance Review, it is easy to understand why this failed: it was written by government employees! What a dumb idea. Do you think government employees would ever recommend eliminating their own jobs if that made sense, When you put a bunch of bureaucrats in a room together, and as them how to save money, they will come up with things like “use fewer paperclips”. Even if there were some good ideas in that review, The fact that Schwarzenegger’s first move was to go to to government employees was really his first mistake- and a pretty big one.

    This has been an extremely closed government. Ask anyone who has tried to work with them – they are practically overtly hostile to small business. Arnold Schwarzenegger was once the guy who said, “I want your ideas, and the more radical the better” but never considered any ideas other then from government employees or his own corporate cronies. Unfortunately, he fell far short of his promise to be a for all the people”.

    I remember reading a story about the fierce mongol horsemen, who swept down from the northern Asia plains intending to destroy China’s cities. Instead, they ended up on the emperor’s throne, and then grew old and corrupt in the land they had once conquered. While most people think Schwarzenegger is probably an nice guy, that is his story here – he grew old and corrupt in an land – California – that he had once conquered.

    Rob Gordon

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