My blog on a federal computer project that went six times overbudget prompted an expert on information technology (IT) to send me an interesting email. In this study on government failure and this study on cost overruns, I discussed some of the reasons why $100 million projects end up costing $200 million.
One measure of the government’s size is government spending as a share of gross domestic product. The OECD has released new data (Table 25) on this measure for 31 member countries, which I chart here for 2015. The spending includes all levels government: federal, state, and local.
Politics and bureaucratic mismanagement drive up costs and generate failure in the federal government. More evidence comes from a Washington Post report today on a botched computer project at the Department of Homeland Security
The Washington Post today discusses how presidential candidate Donald Trump is dismissing the need for major entitlement reforms. The paper noted, “… leading Republican presidential candidate Donald Trump railed against proposals to end or significantly change Medicare.”
Presidential candidates Ted Cruz and Rand Paul have proposed value-added taxes (VATs) as part of their tax reform plans. I critique these taxes in National Review today, arguing that they could become engines of big government growth.
The budget agreement between congressional leaders and the Obama administration would break prior budget caps and increase spending over the next two years by $80 billion. The Bipartisan Budget Act (BBA) of 2015 would theoretically offset that cost with savings down the road, but promises of future savings are worth little given that GOP leaders have shown they will break agreed-to restraints whenever the time comes. The Heritage Foundation is right that the deal is a “colossal step” in the wrong direction and “does nothing to reduce the size and scope of government.”
In researching an upcoming study on privatization, I came across an interesting illustration of the advantages of private science over government science. Private science focuses on efficiency and results, but government science maybe not so much.
After Germany, the Netherlands, and Great Britain, it is now Italy’s turn to privatize its postal service. It seems that even “old Europe” welfare states are more reform-minded on some economic matters than Congress and the current U.S. administration.
Five years ago, Bob Poole and I wrote that Canada’s privatized air traffic control (ATC) system would be “a very good reform model for the United States.” U.S. policymakers—including the chairman of the House committee that oversees ATC—are now coming around to that view.