Keep the 'e' in e-gov

As federal agencies hurtle headlong into digital government, industry leaders

and economists have begun to raise questions about what services are — and

are not — appropriate for agencies to offer online.

Some believe, as indicated during a House appropriations subcommittee

hearing last month, that the Internal Revenue Service's plans to offer online

tax-preparation services would unfairly compete with private companies that

offer those services. They also say the U.S. Postal Service's plan to get

into the electronic bill-paying business is outside that agency's mission

and punishes financial companies that can't compete against a government

entity not interested in making money.

The fact that the private sector is at a disadvantage when it competes

against the government is widely known. Agencies are not concerned about

making a profit and typically have more resources at their disposal. If

competition were the only argument, government would be strictly limited

in what it does. But that is only half the story. A democratic government's

motivations are, by design, different from those of the private sector.

Equality, fairness and inclusion are just a few.

Making it difficult for agencies to provide electronic services could

run the risk of giving too much control to the private sector in determining

what services will be provided online and how. Large segments of the population — namely the poor and those living in rural areas — could be left out. Besides,

the government has had a history of creating some pretty nifty and useful

products. The Internet comes to mind, for one.

Three economists quoted in this issue's cover story offer a good start

toward determining what government should and should not do online. Their

guidance could be improved, among other ways, if they accounted for the

government's role in serving those people who are typically left behind

by the market. But the new Congress had better be prepared to answer those

tough questions.

Let's make sure the government is not cut off from this volatile and

vital market.