Can Trump Fix Government by Running It Like a Business?

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Past administrations have attempted reform by taking cues from the private sector with mixed results.

Donald Trump is taking steps to make the government more like the private sector. Past administrations have tried similar exercises in reform with mixed results, however, and it might be harder for a White House with relatively little governing experience to make improvements to the sprawling federal bureaucracy.

On the campaign trail, Trump pointed to his business record in promising to fix government. On Monday, the White House unveiled an Office of American Innovation, which will make recommendations to improve government based on private sector consultation.

An early start may signal the administration plans to prioritize the effort, though it’s hard to tell what kind of follow-through it will devote to the project, what recommendations the office will devise, and whether any will actually be implemented. The office will be led by Trump’s son-in-law and senior advisor Jared Kushner, who does not have prior experience in government, and whose portfolio now includes everything from the Israeli-Palestinian conflict to the opioid crisis.

“It takes a long time to really improve government, there aren’t quick fixes, so you have to start right away,” said Max Stier, the president of the Partnership for Public Service, a good government non-profit. “It’s also important that you have buy-in from the highest levels of government.”

There’s a long history of presidential administrations looking to the private sector for advice on how to fix government—as well as examples of those efforts amounting to little more than unrealized recommendations. In 1982, Ronald Reagan established the Grace Commission, led by businessman J. Peter Grace, which resulted in a set of recommendations to rid government of waste and inefficiency. “Some recommendations were adopted,” according to a report from the IBM Center for the Business of Government and the Partnership for Public Service. But “the most significant recommendations required congressional action and were not implemented.”

Other administrations have attempted to improve government by modernizing it, a goal the Trump administration is also promising to achieve. According to Elaine Kamarck, an aide to President Bill Clinton who helped implement a reform project known as the National Performance Review, and later re-named the National Partnership for Reinventing Government, the NPR helped bring the federal government into “the Internet Age.” It launched “the federal government’s first, comprehensive web portal,” Kamarck told the House Committee on Oversight and Government Reform in 2013, which was designed to “offer citizens one-stop access to government information.”

The Obama administration also focused on modernization as part of its own government reform agenda, including an effort to update information technology.

Shrinking the size of government, and cutting costs, has been another target of past administrations echoed by the Trump White House, which released an executive order aimed at eliminating redundancy in the federal government. During his first year in office, George W. Bush outlined a call for reform rooted in a “market-based” approach, and announced a “Management Agenda,” which the administration billed as “an aggressive strategy for improving management of the federal government.” As part of that, the Bush administration saved taxpayers roughly $7 billion by encouraging public-private sector competition, according to a 2008 assessment published in the Public Administration Review.

The Clinton administration's reforms also resulted in a cost-savings in the billions of dollars, according to the IBM Center for the Business of Government and Partnership for Public Service report, and included scaling back the size of the federal workforce.

It can be hard to predict how a massive federal bureaucracy will respond to efforts to change it, however. And it may be difficult to avoid unforeseen repercussions. Job cuts under the Clinton administration created “unintended consequences, such as weakening the acquisition workforce and diminishing the expertise and capacity of professionals in federal human resources and other management rules,” according to the IBM Center for the Business of Government and the Partnership for Public Service.

The Trump administration might face a unique set of challenges if the people tasked with recommending and carrying out reforms lack expertise in actually running government. A press release describing the so-called innovation office says that recommendations will be developed “with career staff along with private-sector and other external thought leaders.”

“The concern would be that relying on business people to make recommendations and fixes might not work as well as relying on public administration experts,” said Rob Atkinson, the president of the Information Technology and Innovation Foundation. “The federal bureaucracy is complicated, and you need to address these issues with people who actually understand public administration. Otherwise it would be kind of like taking a governor and asking him to go in and advise General Motors on how to run their business.”

Kamarck made a similar argument, writing earlier this week that “a real government-reform effort must be led by people with in-depth knowledge of the government itself. Otherwise, it will simply be another initiative that is forgotten almost as soon as it is announced.”

Part of the challenge of government reform is when it works well, it often fails to generate much attention or praise, potentially diminishing the incentive for government officials to prioritize reform in the first place. A breakdown in government operations, however, does have the potential to generate significant negative publicity, a lesson President Obama’s administration learned during the botched rollout of the Healthcare.gov website in 2013. “Most presidents focus attention on policy and often fail to understand that won’t mean much if you can’t make it operational,” Stier said.

It’s too early to judge how this latest effort might turn out. But unless the administration makes a substantial effort to tap existing governmental expertise, it’s hard to see how this latest attempt at reform could succeed.

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