Thursday, June 28, 2007

Government Admits It Is Wasting Your Money

It is painfully obvious to anyone paying even a little bit of attention that the federal government wastes a ton of money on programs that are useless or that it has no business being involved in in the first place. Well, it seems that the Office of Management and Budget has figured this out as well.

As part of a program they call, they are using a system called the Program Assesment Rating Tool (PART) to determine the "effectiveness" of government programs.

The Program Assessment Rating Tool, or PART, for short, is a questionnaire designed to help assess the management and performance of programs. It is used to evaluate a program’s purpose, design, planning, management, results, and accountability to determine its overall effectiveness.

Based on the evaluation, recommendations are made to improve program results.

To reflect that federal programs deliver goods and services using different mechanisms, the PART also has customized questions depending on the type of program. The seven PART categories are: Direct Federal, Competitive Grant, Block/Formula Grant, Regulatory, Capital Assets and Service Acquisition, Credit, and Research and Development.

The PART questionnaire is made up of the following questions:

Does the program address a specific and existing problem, interest or need?

Is the program designed so that it is not redundant or duplicative of any other federal, state, local or private effort?

Does the program have a limited number of specific long-term performance measures that focus on outcomes and meaningfully reflect the purpose of the program?

Does the program have ambitious targets and timeframes for its long-term measures?

Does the program (including program partners) achieve its annual performance goals?

Are independent evaluations of sufficient scope and quality conducted on a regular basis or as needed to support program improvements and evaluate effectiveness and relevance to the problem, interest, or need?

Are budget requests explicitly tied to accomplishment of the annual and long-term performance goals, and are the resource needs presented in a complete and transparent manner in the program's budget?

Does the program use strong financial management practices?

Has the program demonstrated adequate progress in achieving its long-term performance goals?

Does the program demonstrate improved efficiencies or cost effectiveness in achieving program goals each year?

Using the answers to these questions, programs are divided into two main categories, Performing and Not Performing, with each having sub-categories. So, had did various government programs fare? Not well:

Based on our most recent assessments, 25% of Federal programs are Not Performing.

The actual breakdown by subcategory looks like this:

To date, we have assessed about 96% of all Federal programs. Here's how they stack up, by rating.

Distribution of Program Ratings
Number of Programs Assessed 977
Effective 17%
Moderately Effective 30%
Adequate 28%
Ineffective 3%
Results Not Demonstrated 22%

Of course, even this gives a rosier picture than is warranted. That is because of the way each program is assigned to one of the sub-categories:

The answers to questions in each of the four sections result in a numerical score for each section from 0 to 100 (100 being the best score). Because reporting a single weighted numerical rating could suggest false precision, or draw attention away from the very areas most in need of improvement, numerical scores are translated into qualitative ratings. The bands and associated ratings are as follows:

Rating Range

Effective .............................................................. 85-100

Moderately Effective ............................................... 70-84

Adequate .............................................................. 50-69

Ineffective .............................................................. 0-49

Now I don't about where you come from, but where I come from a score of 50-69 is not adequate. Just ask any school kid if those grades are considered adequate. They equate to Ds and Fs which is hardly adequate. My dad would have planted his foot firmly in my fundament if I brought home grades like that. Of course it is no surprise that the government is letting the government off easy. When taking that into account, you find that fully 53% of programs are not up to par.

Taking a look at some of the programs in the Not Performing category, we find such gems as this:

Dairy Price Support Program

USDA maintains a minimal price to dairy farmers by buying excess milk in the form of nonfat dry milk, butter, and cheese. The government owned dairy products are stored in warehouses until the dairy products are sold or donated. This program is one of several USDA programs that support dairy farmers.

Results Not Demonstrated

A rating of Results Not Demonstrated (RND) indicates that a program has not been able to develop acceptable performance goals or collect data to determine whether it is performing.

The program has not demonstrated results.

The program began in 1949 to assure an adequate supply of milk, but has not been updated in response to changing industry conditions. The U.S. dairy industry has matured as a global leader in milk production, while current challenges include: price variability, consolidation, global trade, and environmental impacts.

The program has major design flaws that limit its effectiveness.

The program is considered trade distorting because it can maintain U.S. prices above world prices. Dairy production represents 11% of all U.S. farm receipts, but this program accounts for over 30% of permitted trade distorting support under World Trade Organization rules.USDA manages the government owned dairy products resulting from this program for multiple purposes.

USDA is not required to minimize costs, and can choose to sell the inventory back to the commercial market, or incur additional costs to donate dairy products to USDA food assistance programs and other domestic and international charitable organizations.

And this:

Packers and Stockyards

The Grain Inspection, Packers and Stockyards Administration regulates livestock marketing activities at public stockyards and operations of meat packers and poultry dealers. The program was instituted in 1921 to promote fair and competitive trade of livestock, meat, and poultry.

Results Not Demonstrated

A rating of Results Not Demonstrated (RND) indicates that a program has not been able to develop acceptable performance goals or collect data to determine whether it is performing.

The program lacks well-defined internal processes to determine workload priorities, conduct effective investigations, evaluate investigative findings, and monitor industry activity to determine if regulatory reforms are needed.

The program lacks standard definitions to distinguish regulatory activities from investigative activities.

The program maintains inaccurate and incomplete tracking systems.

What business does the government even have maintaining a minimal price to dairy farmers or regulating marketing activities at stockyards? Even if these programs were "effective", they would still be a waste of money. The list is rife with programs and this and then, of course, there are the programs with the feel good names such as Mentoring Program, Safe and Drug Free Schools State Grants, and African Development Fund.

The website states "As a result, all assessed programs are held accountable for improving their performance and management", but there is no discussion of how they are held accountable. You can be sure that it doesn't include shutting those programs down.

In the end, the program only serves as a tool for people like me to complain about the failures of the government. It is highly unlikely Congress will use it as a guideline for ridding the government of wasteful programs that don't even accomplish there missions. So in that respect, OMB should list on the Not Performing list.

Update: BTW, given the re-killing of the immigration bill, I should also point out that the Border Patrol is in the Not Performing category as well.

(H/T Stephen Slivinski at Cato@Liberty)

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