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Saturday, April 27, 2013

THE PAIN OF SEQUESTRATION


THE PAIN OF SEQUESTRATION
 

A post for Cranky Opinion Saturday

 

Comments expressing an opposing opinion are welcome, but please…no name calling…that includes you, you big stupid head!

 

White House tours have been cancelled, airports are experiencing delays, and veterans are having benefits delayed.  All these events and more are blamed on forced Government spending cuts.  The tax payers are feeling the pain, and the need to maintain former Government spending levels is being demonstrated. 

It is somewhat surprising to me that Government cannot cut spending without reducing services. 

“Why does that surprise you Cranky?  Obviously you cannot have the same level of service after you are forced to reduce spending and staffing levels!”

When I worked for a large brokerage firm many years ago, we were told by upper management every other year from 1987 to 2008 to cut spending, usually by ten percent or more.  Our department did this every time and never suffered a loss of productivity.  How?  Why?

There is a certain mentality in middle management of a large corporation which I assume is much the same in Government.  A middle manager’s value is often judged by the number of people reporting to him.  A middle manager is loath to reduce his staff; it makes his position seem less important. 

If you ask a manager if he can reduce his staff by ten percent, he will explain seventy-eight reasons why the department could not function with any less staff and in fact they should be increasing staff. 

When you tell a manager to cut staff by ten percent and that he is expected to still get the job done, staff will be reduced and the job will still be done.

A manager of a large corporation will not reduce staff unless he is forced to cut staff.  An owner of a small business will reduce expenses whenever he sees the opportunity because the savings go directly towards his profit.  A manager of a large corporation does not have that same incentive.

A manager of a large corporation sees opportunities to save money, and he tables it for when he is told he has to make cuts.  If someone retires and his position does not need to be replaced due to technology- improving productivity that position will still be replaced.  When times are good, you do not reduce costs.  When profits go down you need to be prepared for mandated expense reduction.   Our company ordered forced expense reductions 8-10 times over a 20 year period, we complied every time and we still got the job done.

Government should have had similar technology enhanced productivity improvements and yet has seen zero forced expense reductions in the last 20 years.  Why has sequestration caused reductions in getting the job done (service)?”

Government has no incentive to reduce expenses (this is government related; it has nothing to do with the party in power.)  Reducing expenses simply makes everyone seem less important and valuable.  When forced by sequestration to reduce staff and expenses, upper management has the incentive to demonstrate that cuts were untenable and will result in reduced services (either that or admit they were not doing their job.)   The more painful those reduced services the better.

If a manager of a large corporation is not able to produce even with reduced staff or resources, he will be replaced.

Taxpayers will feel the pain of sequestration.  If we do not, government managers will be chastised.  The incentive in government is to prove cuts are not possible, not that “we can find a way.”

In government, difficult goals are impossible without increased resources.  The business of government never goes out of business.

In the private sector, where there is competition, the way to accomplish the impossible is simply to mandate it.  Somehow the impossible gets done.

 

The preceding has been the opinion of a cranky old man and not necessarily that of management…Mrs. Cranky.

8 comments:

  1. You are 100% spot on Big Joe. Another example: If a government department still has some money left over near the end of their fiscal year, they'll blow it on something or else risk having their budget cut the next year.

    A contractor friend was hired to do a complete top-to-bottom renovation of several unused barracks at Ft. Hood in Killeen, TX a few years ago. The cost was several million dollars. The barracks were scheduled for complete demolition a couple of years later. They just needed to burn off the last few million $$* in the budget for that year.

    *Those weren't REAL dollars, but just taxpayer dollars.

    S

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  2. i agree with the commenter above - in my corporate days, you'd see dept. mgrs spending the budget $ whether they really needed to or not - just so next year they would have the same amt or more allotted to them.

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  3. I need to point out that reductions in force have taken place over the years in government, but it is very difficult to reduce staff legally over a temporary reduction in budget. Also as noted with the FAA, they do not have total control over their budget and must get approval from Congress to do many things.

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  4. Many people would be upset if services were reduced--I'm talking about servicing that requires payment of a stud fee!!

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  5. I can't find any flaws in your argument. There is undoubtedly waste in government that can be addressed without the loss of services.

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  6. I tend to combat the government with my own sequestration, then I post about my results on Facebook or my personal blog.

    I tell of savings, then I leave my mark -- The Carlisle Sequester.

    How else are we to show the government that we are more able to make cuts than they are. We need to fire our reps. PERIOD. :)

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  7. I hate to tell you this darling Joe, but for once I am not laughing. In fact, I think I will go somewhere and quietly frow up. Not your fault...you are just the messenger. Sob.

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