Wednesday, February 18, 2009
As state lawmakers scramble to fill what may be an $8 billion budget deficit, people in the private sector are urging them to "think outside the box" to find ways to economize and become more efficient.
Gov. Chris Gregoire (D) has taken the first step in an effort which hopefully will continue well into the future. Working with representatives of state employee unions and private employers, the governor developed an initial set of proposals to streamline state government.
Her proposal would eliminate 154 of 470 boards, commissions and advisory committees, consolidate several agencies, and reorganize how services are provided. For example, she would merge the Health Care Authority with the Department of Retirement Systems, transfer Department of Licensing fuel tax programs to the Department of Revenue, fold the Department of Archeology & Historical Preservation into the State Parks Department, and merge Eastern and Western Washington state Historical Societies.
Taking a cue from the popularity and convenience of on-line banking and airline reservations, Gregoire wants to expand on-line government and education services, making those services more convenient and cost-effective. For example, she would close scores of under-performing driver's license offices and allow drivers to renew their licenses online. In addition, her plan calls for expanding on-line training and community college course work to reduce staffing and facility costs.
Since employers are encouraging state bureaucrats to think outside the box, it's only fair that they do, as well. And they are.
According to a recent article in the New York Times, even as unemployment figures continue to rise, a growing number of employers are coming up with creative ways to hold onto their employees - implementing four-day work weeks, unpaid vacations and voluntary or enforced furloughs, along with wage freezes, benefit reductions and flexible work schedules. This allows employers to cut costs without laying people off.
Jennifer Chatman, a professor at the Haas School of Business at the University of California, Berkeley, says, "Organizations are trying to cut costs in the name of avoiding layoffs. It's not just that organizations are saying 'we're cutting costs,' they're saying: 'we're doing this to keep from losing people.' "
At Global Tungsten & Powders, a metal plant in Towanda, Pa., business is off 25 percent from a year ago. The company has already cut overtime and travel, as well as purchases of office supplies and equipment. It is now encouraging its 1,000 workers to take unpaid furloughs to stave off more drastic cuts.
Human Resources Director Craig Reider says, "We have a very skilled and competent work force and the last thing we want to do is lose them when we're assuming this economy is going to come back."
At the Pretech Corporation, a concrete manufacturer in Kansas City, Kansas, part of the rationale is pride. The company has not had a layoff in 15 years. To keep people working, the company has cut overtime, traded a $5,000 holiday party for an employee-only barbecue lunch, and trimmed its pipe making operation to four days from five, which allows it to save on heating and electrical costs.
Not all such efforts are successful, however.
When the chairman of the faculty senate at Brandeis University asked the school's 300 professors and instructors to give up 1 percent of their pay to save the jobs of other school employees, less than a third volunteered.
Weathering this economic crisis will require that we all do our part. This is no time for selfishness, turf wars or partisan bickering. Every legislative proposal should include specifics on how it will increase efficiency, reduce the cost of government or create jobs.
Gregoire's proposals represent an important first step toward reducing the cost of state government and making it more efficient, but more needs to be done. It is critical that lawmakers support those efforts and continue the work of streamlining government.
- Don C. Brunell is president of the Association of Washington Business.