Government Works Badly—If We Refuse to Invest in It

Posted by Miriam Axel-Lute on September 19, 2014

At the Bipartisan Policy Center's Housing Summit earlier this week, Shelterforce got to interview former HUD secretaries Mel Martinez and Henry Cisneros (we'll publish that interview here next week). One of the questions we asked was how to handle the fact that the American electorate often seems to have a bias, not so much against housing programs (think the fantastically expensive mortgage interest deduction), but against the poor.

Martinez said he thought that people would respond well if you proposed specific solutions that worked. When I followed up to ask whether that required a sort of basic faith that government could deliver on specific solutions, he fell back on fairly standard Republican lines about government, saying that people would be justified in being skeptical about that.

Former House Speaker Newt Gingrich did the same in his speech to the summit Tuesday morning, telling with relish tales of the IRS sending hundreds of mistaken refund checks to a single house in China or asking us to compare the accuracy and speed of getting money from an ATM in a different country with the 277 days it takes on average to transfer someone's medical records from the Dept. of Defense to the VA.

To some extent, this was a matter of selective examples. After all, you can come up with some mind-boggling stories of systemic incompetence at banks and mortgage servicers trying to handle loan modifications—foreclosing on the wrong people, requesting the same documents a dozen times, etc.

But there's also something to it. 

Gingrich said there was a coming policy revolution that will be "technological, not ideological," and he's both right and wrong. The systems many government agencies are working with are woefully behind the times, and people in the nonprofit world who have to work with them are painfully aware of this.

But the reason for that is at least partially ideological—we haven't been willing to fund the investment in systems infrastructure and sufficient staffing that these agencies need to become the efficient bodies we want them to be.

In fact, this was a major theme at the summit’s bipartisan panel of former FHA commissioners on Monday, nearly all of whom lamented at some length the difficulty in an annual appropriations cycle of getting the resources needed to make badly, badly needed systems upgrades, even though they would likely save the agency significant money in the long run.

If a normal private business anticipated a large period of growth, noted Nic Retsinas, as FHA could do for itself as the housing crisis took hold, it would ramp up by hiring more staff and improving or upgrading systems. That's hard for FHA to do. In fact, David Stevens, now head of the MBA, called it "absurd" that FHA has to beg for money every year just to stay in place, even as Galante noted that it's pretty impressive how well FHA manages at running a trillion dollar insurance company under these constraints.

Technology, even money-saving technology, is not free. This is true for government, and it's true for individuals, as HUD Sec. Julián Castro pointed out in his remarks to the conference. Despite the near universal show of hands in the summit room when Gingrich asked who had a smartphone, Castro, in his remarks, reminded us of what life is like for the people HUD mostly exists to serve—75 percent of families making under $25,000/year don't have broadband at home. He described the dozens of people already lined up for the computers at the Bronx Library Center when it opens every morning, and young people leaning up against its windows when it is closed to try to get its free wifi signal. Even those who have smartphones may not be able to rely on them as they struggle to keep up with connection fees and data plans. We forget this at our peril. The digital divide is not yet closed, and if anyone should remain set up to serve those without access to the latest app, it's the government, though it should certainly also be making use of the potential for apps to reach more people and increase efficiencies and we need to invest in its capacity to do so.

So while Gingrich may be right (did I just say that?) that we should completely rethink service delivery, verifications, and applications at agencies like the VA and HUD in the age of the app, we should shy away from concluding that starving a supposedly bloated, antiquated federal government is the way to generate such results. If we see the possibility, let’s invest what it takes to get there.

(Photo by Gage Skidmore, CC BY-SA.)

About the author more »

Miriam Axel-Lute is editor of Shelterforce and associate director of the National Housing Institute. Her email is miriam at nhi dot org.

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Valerie Buchand
23 Sep 14, 10:47 am

I find that HUD has allowed Public housing authorities to take away programs that help low income people to get ahead, to be self sufficient in life to keep them bound. Grass root leaders are often overlooked when decisions are to be made. Much misuse of tax payers dollars are lost in this. HUD continue to use this practice and not only keep people with lack but at a disadvantage. On paper is recorded good outcomes
but is reality it isn’t true. There is no accountability with the authorities but the blame is on residents, simple not true.

The mix-income development concept across the country has it pros/cons. Resident isn’t involved in the decision making process. Authorities across the country is working to get from under HUD to eliminate that safety net for the rights of its citizens, a very bad move. In some cases homeownership has not been offered under the voucher program. So many disparities exist however those that are affected aren’t heard or citizen sign in when coming to meetings and is used as agreeing with what is being done. People don’t respond because it is not known until it is done. When will the real citizens in this area be involved and not just to occupy time but have real meaning in meeting to make a difference. 









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