With the election campaign turning into almost five months of Same Old Hillary and Dangerous Donald, it’s time to look elsewhere if you want to talk about actually accomplishing something, and doing something good, in politics and government.
In October of 2014, I wrote a post entitled “Making Government Work Better – Something Everybody Can Agree On, Right?” That post talked about assessing laws against what they are supposed to achieve and rewriting them so they work better. I got the idea from New Zealand and said that it seemed to me to be “a concept that both right and left should be able to unite behind.”
Let me do some more of that, once again with an example from New Zealand. The National Party is heading a center-right government in New Zealand. The Finance Minister of that government, Bill English, has been talking about, and is actually starting to implement, something he calls “social investment.” The idea originally came from a review of the state-run Accident Compensation Commission in 2011. Back then it was called “forward liability investment approach,” and it “was applied to getting beneficiaries into paid work and keeping them there, thereby avoiding paying a lifetime’s benefit to them.”1
“English put it this way: ‘investing’ so people become independent of welfare, social housing and urgent health services ‘ensures people lead better lives but also saves taxpayer money in the long run’.”
For a fuller explanation, let me quote from a speech by Bill English to the Institute of Public Administration New Zealand in February of 2015:
“The Cabinet has directed the Treasury and social sector agencies to develop a new Budget process, which we call social investment.
The idea is that the Government will invest in individuals and families today for measurably better long-term results.
Better results for the individuals and families.
And better results for the Government’s books.
This new social investment budget process will embed five major changes.
First, ministers will have far more information about populations than is available through the traditional budget process.
They’ll be able to see what services are delivered where, and the results those populations are achieving in health, education, employment, and so on.
This will help inform where the next dollar of government spending can make the greatest difference.
Second, rather than purchase inputs ministers will purchase better results.
For example, the Government will purchase reductions in recidivism, rather than rehabilitation programmes.
It will be up to providers to judge how to achieve those results in view of local circumstances. We’ll be tracking results at an individual and family level.
Third, testing for spending effectiveness will be core to this process. If we can’t measure effectiveness, it won’t be funded through social investment.
Fourth, we’ll be systematically reprioritising funding to providers that get results.
And finally, we are exploring ways to test departmental bids against external providers who might find it easier to offer services for families and communities.
We’ll be buying what works.”
Before some people start protesting, Bill English understands that the social investment doesn’t work for everything government does: “Social investment will not be suitable for all public spending, or even a majority of it.” But he sees it has an important role in certain areas, and he promises: “I can tell you it is here to stay.”
I realize there are differences between New Zealand and the United States that make it easier to do things like this in New Zealand. New Zealand has a parliamentary form of government, so the government can get things passed by Parliament. Second, the heads of government departments are not political appointees, but real managers, who are graded and compensated based on actual performance. Consider if the head of the Department of Health and Human Services had been a professional and had been compensated based on the rollout of Obamacare. Or if those running the Veterans’ Administration hospitals had been judged on the basis of their performance in either of the last two administrations.
Also, New Zealand is small. As I mentioned in 2014, it has fewer people than Louisiana. Smaller makes it easier to implement these kinds of reforms. Bill Clinton could do things in Arkansas when he was governor that he couldn’t accomplish in Washington when he was president.
But still, there is an approach and a concept here that is almost alien to our political discourse. In the United States, it’s just about spending money. The theory seems to be, both for the President and the Congress (whichever party), if we pass the program and appropriate the money, the problem is solved. Except it doesn’t work that way. I talked about that in October 2014 with respect to assessing laws against what they are supposed to achieve.
This takes that idea a step further. It’s about spending money now in order to not have to spend it later. But it’s not just that. Because people talk about that here, too. It’s also, and this is the key, about real results. It’s not about what a program’s proponents say will be done; it’s about what the program actually does. It’s about spending money effectively. It’s about seeing where the most good can be done – and spending the money there. So the most results can be achieved. In addition, and this may be a little controversial, it’s about not who does the services but about which service providers get the best results. Because it’s about results for the people who need to be helped.
The New Zealand government is serious about this. Colin James explains part of the process for how this will work:
“Officials have had to put [projects] through a more complex cost-benefit process that requires a clear statement of the resultant ‘impact’.
This ‘CBAx’ process is a web-based interactive template that can project up to 50 years in calculating the net present value of an ‘investment’. …
[Finance Minister Bill] English looks to it to generate a common language which will enable better assessment of the relative value of different projects.
The template requires agencies to identify the ‘impacted’ people or cohorts and the time periods, including ‘counterfactuals’ if no or different action is taken. They must spell out assumptions … and quantify not just who gains and who loses in their sector but flow-on impacts on other agencies’ sectors.
The expected impacts don’t all have to be reduced to dollars. Agencies can try out scenarios. …
The CBAx is not headline stuff. But it is an element in a significant shift on English’s watch in the way the government does its business — potentially helpful also to future alternative governments wanting credence. English expects it to generate more ‘investible’ propositions.”
Consider this kind of approach to what government does and compare it to Hillary Clinton’s proposals or Donald Trump’s (or, for that matter, Bernie Sanders’ free-everything-paid-for-by-taxing-the-rich {or something close to that} proposals). It’s depressing. There is nothing like this in what either former Secretary Clinton or Mr. Trump is proposing. While Mr. Trump’s proposals are probably farther off than Secretary Clinton’s in terms of budget impact, where is the review for effectiveness and actually accomplishing results in her proposals? Both of them are just doing the same old thing: Spending money and considering the job done.
New Zealand is doing something different. It’s trying to figure out how to actually help people and then do more of what works and less of what doesn’t. Focusing on the best way to get results for people and on the best way to get those results delivered to people.
Audrey Young, the political editor of The New Zealand Herald, picked Bill English as New Zealand’s Politician of the Year for 2015 in large part because of this effort:
“[H]e is the driving force of a major and logical change in the way the public sector funds the provision of social services – the social investment approach which at its essence means paying more for policies that work and are shown to work. …
… Bill English's social investment project is his biggest achievement.
It sounds so logical that you'd think it had always been done that way – paying for what is proven to work.
But it hasn't always been. It now provides a clear incentive for the public sector to find out with greater clarity what works and what doesn't.
If it becomes embedded, it will be a lasting change for good in the lives of the least fortunate.”
There is little to say about the difference between this kind of idea and the campaign in the United States this year. Other than to sigh.
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1 It is also going to be applied to keeping prisoners out of jail when they are released.
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