☆ Moses on Mahan’s state spending plan: it’s “more marketing than substance”
Sure, the SJ mayor is right to point out that California’s budget is broken, but by what standard will Mahan measure his results, asks Mark Moses, author of The Municipal Financial Crisis. He says the CA gov candidate’s spending plan doesn’t even hint at what real accountability would look like. An Opportunity Now exclusive reaction.
This is more marketing than substance.
I agree with Mahan’s assessment that "something is broken" but I don't see his plan as being particularly "bold" - or even specific enough to qualify as a "plan."
Because of something I call the free money trap, it won't be so easy to achieve "radical accountability, transparency, and zero tolerance for waste, fraud, or failure."
Mahan is correct that the problem is not a need for more revenue, but by what standard will he determine that the results he would produce (as governor) are "better"? He does not say, nor does he give a hint.
We have talked before about how Mahan's performance-based pay strategies for a government workforce would be very different if applied to the private sector. If you are my head of regional sales, I can give you minimum growth targets that you must reach to maintain your job. If you are the director of a housing agency, what metrics do I use? And is it fair to you to hold you to such metrics when you must accomplish your goals with staff over whom you have no practical ability to fire for low performance? More critically, who is going to establish these standards - and to whom are they accountable?
I'm not impressed with the proposal to implement a California version of Colorado's SMART Act. It's not that there aren't some efficiencies to be gained. It's that it's unclear that such a program will have a positive budget impact. (Think DOGE.) If you look into the Colorado program with the advantage of hindsight, you will see that the results were mixed, at best. I say that mixed results are as bad as poor results when the program is implemented on the premise that it will produce grand results.
In Chapter 4 of my book The Municipal Financial Crisis, I explain why Zero-Based Budgeting does not work. The problem is that you never truly start a zero. You always start with the politically protected people and programs and the inertia that anchors you to the status quo. Before I called my approach "Budgeting for Scope," I called it "Zero-Based Scoping." The idea being that Zero-Based Budgeting assumes that the goals, programs, and scope of the organization do not need to be challenged; only the budgets need to be challenged. ZBB can yield some positive results on the margins. But to challenge the organization's spending, you need to (1) ensure that the goals and activities of the organization are appropriate; and (2) ensure that the service delivery methods are efficient. But few people want to challenge the goals, and the labor agreements make it difficult to address the service delivery methods.
Regarding state procurement, it is not clear to me how significant an issue this is, particularly given the state's structural budget deficit. In any case, greater use of cooperative purchasing and shared services is not going to solve the state's problems. It sounds like an area for which it is convenient for Mahan to declare a problem so he can make some changes and later declare victory.
Mahan's approach to fraud will have little positive impact. Although, I would expect his performance in this area to be much better than that of the incumbent governor, who has set a very low bar.
As for the 2,000 plus lobbyists: They will always be there so long as the scope of the state's activity is broad and malleable. Sure, he can tighten up on some of the most egregious special interest activities, maybe. But then it's like whack-a-mole. If you can get any law passed, regardless of its impact on the freedoms of California residents, so long as you have the votes - you will attract lobbyists and rent seekers. The solution to lobbyists is to not offer the ability to enact rights-limiting legislation - (i.e., you take away the supply, rather than attract the special interests and then try to control the manner in which the demand is expressed).
Follow Opportunity Now on Twitter @svopportunity
We prize letters from our thoughtful readers. Typed on a Smith Corona. Written in longhand on fine stationery. Scribbled on a napkin. Hey, even composed on email. Feel free to send your comments to us at opportunitynowsv@gmail.com or (snail mail) 1590 Calaveras Ave., SJ, CA 95126. Remember to be thoughtful and polite. We will post letters on an irregular basis on the main Opp Now site.