Progress Report - Chapter 4


Less Borrowing, More Reinvention

The Administration and Congress have made the tough decisions necessary to sharply reduce deficits for the coming years. In their five-year agreement of 1993, they slowed the growth of overall spending and applied a "freeze" to a major portion of the budget.

Because that agreement will keep spending tight for the foreseeable future, the federal government must find ways to spend the money it has more effectively. The situation requires, in essence, a new philosophy of governing that places a premium on cost-effectiveness. That's where NPR's work of the last year comes in. Reinvention is a way to proceed in this difficult environment.

As previously discussed, public confidence in government has plunged in the last 30 years. But the public has not cut its appetite for government's goods and services--retirement benefits, health care coverage, transportation and housing subsidies, investments in science and technology, support for the poor, and so on. What government faces is a public with a 1960s-era appetite for its services, but a 1980s-era attitude about its capacity to deliver.

Nor will cuts in "wasteful" spending completely close the budget gap. Yes, the Administration and Congress can eliminate more programs like the wool and mohair subsidy, as they did in late 1993. They can close the Uniformed Services University of the Health Sciences, a Defense Department facility that Congress probably will keep open for now.

They can scan the budget for this and that "pork." And, to be sure, each program that they eliminate will make a difference not only in terms of savings, but in restoring the public's confidence that its tax dollars are being spent wisely. In the end, though, the nation's leaders can't completely wash away the red ink this way.

The fact is, most government spending goes for major programs that people (1) want, (2) need, or (3) must finance. In the first category are Social Security, Medicare, and other "entitlements'--programs through which benefits are allocated based on some legally established criteria, such as age or income. In the second category is defense. In the third is interest on the national debt. Taken together, entitlements, defense, and interest account for about 85 percent of all federal spending.

What the government needs, then, is a new, more efficient way to deliver basic services. From Red Tape to Results provided a blueprint of principles to enable the government to operate more effectively with less money, not just today but in the future. Fiscally speaking, NPR's management philosophy is far more important than the specific program cuts that it advocated.


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