Were it not for my status as a United Airlines Premiere Flyer that allowed me to bypass a seemingly endless security line, I would have missed my 6:18 AM flight from San Diego to Atlanta. Airport security lines with one hour and longer waits are apparently very typical at peak travel times in San Diego as they are in many other large airports.
These lines are government waste. Any manufacturing leader, indeed anyone trained in thinking about processes, could improve the efficiency of the US airline security system. A thoughtful reinvention could easily maintain safety while lowering federal employee cost as well as the traveler’s indirect costs – lost productivity from feeling sleepy all day from having to get in line at 4:45 AM for a 6:18 AM flight, not to mention the waiting time itself. Step one en route to a better system? Frequent travelers with US Passports receive streamlined security.
Government spending is a vital topic as federal budget deficits are large and growing. While Medicare, Medicaid and other transfer payments are a critical part of the problem and must be addressed, we’ll also need reductions in government direct spending as a share of our nation’s economic activity – spending like the Transportation Security Administration’s airport payroll. The best way to execute these spending cutbacks is to make our government more efficient while increasing investments in research, infrastructure and other areas that advance our economic competitiveness.
My friends in government don’t understand why business people view high levels of government spending as “waste.” Business leaders have spent the last three decades redesigning processes to improve effectiveness while unleashing the power of technology to reduce costs — all to survive in rapidly commoditizing markets that demand lower cost structures and differentiation. Non-profit business leaders have created earned (versus donated) income streams and must now demonstrate their ability to change outcomes to win grant awards. Until business leaders see the same level of innovation in government, concerns about ‘waste” will remain.
Consider the reduction in government and business costs from a truly simplified business and personal tax code that’s also progressive and fair. While the disruption caused by a new tax code would be significant for those in the accounting profession, imagine how business would prosper if money spent on internal and external accountants was reinvested in growing the business. How many individuals would avoid cheating if tax forms only had 10 lines? I for one would gladly give up my deductions for a simpler form and lower marginal rate.
Instead, our national government spends weeks arguing about spending on Planned Parenthood, a cutback that data shows would drive up longer-term healthcare costs and increase unwanted pregnancies, which then increase abortions and children living in poverty. The latter further drives up government costs. This is not the kind of cost cutting we need according to the Republican publisher of the Pittsburgh Post-Gazette, who took out a one-page Wall Street Journal ad April 4, 2011 to make just this point.
The global economy has become ruthless to the inefficient. My seatmate on the plane to Atlanta commented that despite winning an early technology battle his start up company sold out to a competitor because his company never invested in the infrastructure that would have allowed it to scale at a highly profitable margin. Over time, his company’s R&D investments were outpaced by those of the acquirer, a company with the wisdom to build an efficient supply chain from the start.
I predict the worldwide economy will also become ruthless to nations with inefficient or ineffective governments as national economies become increasingly global. A report on government spending by The Economist, entitled “Taming Leviathan,” argues that Singapore’s strong growth stems from a competitive advantage in “good, cheap government.” The nation’s “central message has remained much the same for decades: come to us and you will get excellent infrastructure, a well-educated workforce, open trade routes, the rule of law and low taxes.” What a contrast to China “seeing foreign investment as a way to steal technology or to build up strategic industries.” Can the US’s bloated and dysfunctional political system, greased by money, build conditions for success in the information age? I doubt it.
A dysfunctional business leadership team never succeeds in repositioning its company for more challenging times. The same holds true in government. The Economist reports that Singapore’s government makes longer-term decisions and is full of top talent, talent that often goes back and forth between the public and private sector not as lobbyists, but as managers and leaders. Perhaps if we got money out of government elections (or revealed who is behind the money), adopted a non-political process to reapportion legislative districts and stopped as a nation demeaning government workers, we’d move towards Singapore’s system. We’d build a more competitive economy and level the playing field on which US companies compete. Now that’s something worth standing in line for!
What are you doing as a company leader and voter to help create a more forward-looking and effective government on national and more local levels? The generations that follow will appreciate the time you take to reflect on this question.