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GAO Report Echoes Reason's Recommendations on Government Reform

David Godow
March 7, 2011, 2:21pm

Last week, the Government Accountability Office released a list of 83 potential reforms to "reduce potential duplication in government programs, save tax dollars, and enhance revenue," the first of what will be an annual series. While the details for each recommendation are somewhat thin and many lack estimates of potential savings, the GAO highlights a few specific government reform issues tackled by Reason Foundation recently.

Improving federal contracting practices - Reason Foundation's recently released Annual Privatization Report has a robust section addressing opportunities for privatization in the federal government which, among other things, advocates against the "insourcing" of activities now performed by private contractors. In recent years, the Obama administration has attempted to bring more and more activities "in house", replacing contractors with federal employees, despite the failure of such policies to save money.

Forsaking the private sector through insourcing could actually increase costs by forcing federal agencies to provide support services that it may have no competency in, or which may not be essential to its mission. Would outfits like the Department of Labor, which mostly employs economists, statisticians, accountants, lawyers and other analytical types, see efficiency gains from developing its food service capabilities? It's difficult to see how.

Reason's recommendations on this issue dovetail with those presented by the GAO, which advocates for more private competition in federal contracts. The GAO points specifically to the $170 billion spent on noncompetitive contracts every year, despite legal requirements that most federal contracts be awarded competitively. That's 31 to 35 percent of all contract procurements. Pushing for more, not less, private bidding for federal contracts could shave a substantial amount off that sum.

Inventory and sell off unneeded federal property - In recent years, the government has begun paying increasing attention to the slapdash, inefficient way it manages its own property. In mid-2010, President Obama argued that "the Federal Government... has managed more real estate than necessary to effectively support its programs and missions." He called on the government to find $3 billion in cost savings from selling off underused property.

In response, Reason Foundation produced a study highlighting 12 steps the government could take to meet that goal. The GAO's report echoes this sentiment, noting some of the specific challenges that agencies face in trying to dispose of their unneeded property, like the requirement that excess real estate be offered to various other government organs (or even non-profits) at no cost.

Both selling off unnecessary property and promoting more competitio nin contracting should be considered low-hanging fruit for policymakers looking to cut the fat out of government. The real work of balancing the federal budget will be drawn out and contentious, but relatively small and easy fixes like these will certainly help.


David Godow is Research Assistant


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