I was going to post another blog today until I saw the Van Jones Op-Ed piece in the Sunday, July 25, New York Times entitled “Shirley Sherrod and Me.” Not only do I agree with his conclusion that the Obama Administration decision to fire Ms. Sherrod was wrong and destructive, but it might have been one of the most harmful actions the Obama Administration has taken on any issue.

Government officials have become more risk-averse over time, and less effective as a result, precisely because, in varying degrees, they are judged by different standards from private sector employees.  Over a decade ago, I had dinner with an executive who had been fired by the U.S. Postal Service, after he had worked in the private sector for a good part of his career.

His observation about being a government executive was that the highest risk situations for a government employee were either unwanted media scrutiny, the threat of a government investigation, or the threat of a Congressional hearing.  There was another long-term Postal Service executive who was fired a few years later because of a relocation package he received, which received excessive media scrutiny, even though it had been approved by the Postal Service’s Office of the General Counsel, its chief ethics officer, and the Inspector General.  One thing I learned about the Postal Service is that, after a 1992 scandal involving vendor-related events at the Barcelona Olympics, it operated at the highest ethical standards.  The firing was unfortunate, but the Postal Service apparently felt that it had to eliminate even the appearance of ethical problems.

The trouble with the Sherrod firing, as well as other incidents like it, is that as Mr. Jones put it most eloquently:

“Life inside the Beltway has become a combination of speed chess and Mortal Kombat: one wrong move can mean political death. In the era of YouTube, Twitter and 24-hour cable news, nobody is safe. Even the lowliest staff member knows that an errant comment could wind up online, making her name synonymous with scandal.

The result is that people at all levels of government are becoming overly cautious, unwilling to venture new opinions or even live regular lives for fear of seeing even the most innocuous comment or photograph used against them, all while trying to protect and improve the country.”

Not only is he right, but, unfortunately, the Sherrod incident will be remembered for a long time, and will affect behaviors all over all levels of government.  Government officials and employees will attempt to figure out not only whether what they said or did could get them into trouble, but whether someone could misinterpret and distort words or actions to hurt them.  They will refrain from doing or saying something, rather than doing something that needed to be done.

I had that experience a few times while I served as CEO.  It was unnerving.  People literally heard something different from what I said, and, on two occasions, an otherwise competent and well-meaning attorney told me that the company could get into trouble not only for what I said, but for what people incorrectly thought I said.

Having people live in perpetual fear is a bad way to run government, business, a non-profit organization, or any other grouping of people.  It is a bad way to force people to live their lives.  The notion that people should be held accountable for distortions that other people might create or project on to a situation is dangerous.

The Obama Administration has to realize that it did severe and probably irreparable damage to the effectiveness of government at all levels, and needs to pull back from knee-jerk behaviors based on appearing to defend the highest standards of ethics and race relations.  It actually achieved the opposite effect: individuals will be scared to talk constructively about race issues in situations in which a dialogue could help race relations.  Moreover, the impact will be felt in a wide range of other situations and on a wide range of other issues.

The President should take the step of framing how he thinks about the level of initiative he wants from government employees, and have a concrete set of actions, which he should announce in a prime time nationally televised address.  He should then follow through on his commitments, and make it clear to government employees that a misinterpretation and distortion by someone else will never again subject an employee to disciplinary action.

I may come across as an alarmist, but I really think this situation has far more serious consequences than might first meet the eye.

As stories appear day after day about the dire financial positions of state and local governments, the question that pops up is: where did all our tax money go?  I would suggest three answers:

• Excessive benefits for government employees and their families;
• Excessively high payments to vendors; and
• Excessively high welfare payments.

I would also suggest that states, over time, because of well-intended, but poorly conceived, laws, substituted unproductive clerical and bureaucratic rules-oriented employees for those who did productive work.  For example, governments today very likely have more clerical and administrative employees, but lack skilled professionals of all kinds to manage projects and programs.  In schools, there are many more administrators and service employees relative to teachers than there were a generation ago.

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In the Saturday November 21 New York Post, reporter Michelle Malkin writes a scathing op-ed piece on the Service Employees International Union,  entitled “The Union That Hates the Boy Scouts.“.  The major point of her piece is that the SEIU strongly opposes volunteer work in many communities, because they believe that volunteer work takes paid work away from union members.

Her description of certain union positions rings true to me because I recall that the Stamford Youth Foundation (Stamford, Connecticut) could not staff the variety and volume of after-school activities that it would have liked because union contracts required it to pay every teacher for the extra hours worked after the regular school day.  This deeply bothers me.

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Periodically, my lifelong decision to be an independent voter, rather than a registered Democrat or Republican gets reinforced. My independence stems from a deep distrust of a concentration of power or financial reward anywhere in our governmental, business, or non-profit sectors.

Recently, I have seen evidence of what happens when there is the following lethal combination of circumstances we have today:

• highly-concentrated government or business power,
• inattentiveness of the majority of the population,
• exceptionally high rewards from the exercise of concentrated power, and
• more power concentrated in ideologically-driven people.

The vast majority of Americans are unhappy and insecure with respect to the political and business environment in which they find themselves. 

Fiscal Irresponsibility at all Levels of Government

Without most of us noticing it, state and local governments, which are required to balance their budgets every year, have engaged in a massive transfer of wealth from the vast majority of their citizens to a relatively small, but exceptionally militant and well-organized group of state and local government employees.  I am not angry at the demands made by these employees in their collective bargaining negotiations, but am disappointed that elected officials have not only supported and caved in to those demands, but have also hidden the true costs of these actions from voters.

In Connecticut, for example, the present value of retirement benefits for state employees, including elected members of the executive and legislative branches of state government, is $40 billion as of the end of the 2007 fiscal year, and it is probably higher today.  For roughly 80,000 full-time employees, that averages $500,000 per employee at the time of retirement.  Although this money is paid over time, it is part of the long-term indebtedness of the state that crowds out the ability of the state to invest in roads, bridges, public transit, education, public health, environmental sustainability, public safety, and rebuilding of our cities, among the much worthier uses to which the money could have been put.

Connecticut is not unique in this regard.  Virtually every state has some astronomical retirement benefit obligation, as amply demonstrated by a report of the U.S. Government Accounting Office, http://www.gao.gov/new.items/d08317.pdf

How did this happen?  Our elected officials are generally well-intentioned individuals with a desire to serve the broad public interest.  However, when confronted with well-organized public employees’ unions who want increases in pay and benefits, it has been far easier to concede on long-term benefits than on short-term pay increases, since the long-term benefits are not required to be reflected in annual state government  income statements.  I do not blame the unions for demanding these benefits, or even the elected officials for agreeing to them, but I believe that the public has been relatively disengaged for too long in monitoring issues like this.

On Monday, July 20, both Houses of the Connecticut General Assembly voted on straight party lines to override Governor Rell’s veto of a well-intended, but flawed, health care bill called the SustiNet bill.  Although the bill had many great features and was supported by many great leaders, one of its fatal flaws was the creation of a health policy board specifically designed to exclude many critical stakeholders, including large employers, insurance companies, hospital leaders, and pharmaceutical companies, all of whom should have been part of the board. 

In effect, the General Assembly, through amendments to the original legislation, set out to create a highly unrepresentative policy board on one of the state’s most critical competitiveness issues.  Until after this bill passed both houses of the General Assembly the first time, few business leaders were even aware of its existence, much less its damaging terms and conditions.  I wrote an Op-Ed piece in the July 19, 2009, Hartford Courant expressing my opposition to this legislation as enacted, specifically, in part because of whom it excluded from the health policy board, and called some of our elected representatives.  While I obviously did not succeed, I did my best to make sure that elected legislators knew how I felt.

Too many business leaders believe that they can escape fiscal crises and problems in their headquarters states by leaving those states, but we are increasingly coming to realize that there is no place to which to escape.  The federal government will end up bailing out state and local governments, as it has done with significant chunks of the stimulus legislation, and all of us will pick up the tab.

The answer is not to replace the incumbents, whether they be Democrats or Republicans with other incumbents, nor is it to have term limits (which I support for other reasons.)  The answer is a more continuously engaged and active citizenry, particularly in the business community.  Too many major CEOs and other senior executives think of themselves as world citizens who have little connection to the communities in which their companies have major operations.  Too often they delegate management of government affairs to specialized legal and government affairs professionals.

If we are to constrain the absolute power of government officials and the special interests to which they cater, we need the check and balance of continuous engagement by a much larger part of our citizenry.  As travel writer Rick Steves stated in his book Travel as a Political Act,

“Whether you’re a mom, a schoolteacher, a celebrity, a realtor, or a travel writer, it’s wrong to stop paying attention and let others (generally with a vested interest in the situation) make political decisions for us.  Our founding fathers didn’t envision career politicians and professional talking heads doing our political thinking for us.”

Although I do not plan to go as far as folk singer Arlo Guthrie and become a member of either party, I agree with his comment in the interview entitled “Just Folk” in the Sunday, July 26, 2009, New York Times:

“I became a registered Republican about five or six years ago because, to have a successful democracy, you have to have at least two parties, and one of them was failing miserably…We needed a loyal opposition.”

To put it simply, if we are to avoid the corrupting effects of concentrated power, we must take back that power from those who have it.  I do not believe those with power today are bad people.  In fact, I have much in common with their goals, and believe them to be decent people who want to do the right thing.  However, without checks and balances, everyone, including me, is highly likely to make significant and bad decisions.  We cannot let that happen.

Pitney Bowes is sponsoring a program with the American Red Cross called Holiday Mail for Heroes to enable Americans to send cards to active and wounded members of the armed services, military families, and veterans during the holiday season.

This is the second year of the campaign, and it has shown me not only the power of these handwritten letters and cards for those receiving them, but for the senders and the people who have volunteered to get them to the recipients.  Today, we desperately need to come together and connect emotionally.  The fear that the economic crisis has caused in many people has had the effect of making them suffer alone, and of making them believe that they are powerless to help themselves or others. (more…)

Two news items pertaining to health-related legislation caught my attention this summer.  In the July 22 issue of The Wall Street Journal, in an article entitled “Exiling the Happy Meal,” reporter Sarah McBride discussed proposed legislation in Los Angeles that would ban fast-food restaurants like McDonald’s and KFC from opening in a 32-square-mile section of the city.  Not surprisingly, one critic referred to the proposed legislation as an “example of a nanny state.”  Another critic, the president of the California Restaurant Association, blamed the obesity epidemic on “sedentary lifestyles and lack of nutrition education.”

The article also referred to New York City’s law requiring disclosure of calories on the main menus above the counter, and noted that San Francisco also will implement calories disclosure legislation.

A second article, dated July 30, also in The Wall Street Journal, entitled “San Francisco Votes For New Tobacco Rules” reporter Ann Zimmerman describes San Francisco’s proposed law to ban tobacco sales at pharmacies. An article in the Journal the day before, also written by Ann Zimmerman, entitled “Drugstore Tobacco Sales Under Fire”  summarizes arguments from opponents of the legislation that suggest that the legislation will have little impact on smoking rates and will force retailers to deny members of the public something they want. (more…)

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In the April 9 Wall Street Journal, there is a front-page story about the impact of sub-prime lending on ordinary citizens. Featured in the story is a 74-year-old self-employed tailor who put her entire $55,000 life savings into a high-interest-rate notes issued by a Philadelphia lender called American Business Financial Services. When the firm went bankrupt, she and others lost their entire life savings. The blog entitled The Importance of Being Financially Literate reinforces the fact that Americans lack financial knowledge even in the most basic savings and investment decisions.

While the story is a tragedy, it brings to mind the urgency of focusing on teaching all Americans financial literacy. The National Urban League and its affiliates have specific financial literacy programs, specifically focused on first-time home buyers. Operation HOPE, headed by the very impressive John Bryant, is specifically focused on broad-based financial literacy. These are great programs, and they provide individuals with good nuts-and-bolts tools. Other notable mentions on behalf of the National Urban League in partnership with Honda amid the turbulent economic climate include their offering of personal financial management classes. The acclaimed “Know Your Money Program” seeks to provide economic empowerment and financial literacy to those individuals in communities seeking to change the attitudes about money and money-management. The program is highlighted in this Honda Blog post. (more…)

As a person who studied Communications, Political Science, and Law during college and law school, I am acutely aware of the power of language to shape how we think about and act on problems.

The main example that comes to mind is the way we characterize how government positions are filled.

When I was growing up, like most American history students, I read about the 1881 assassination of President James Garfield, who was killed by a “disappointed office seeker.” I learned that this tragedy gave rise to “civil service reform”, which, if I remember the history books, characterized the change as being one which replaced an appointment system based on “patronage” or “spoils” with one based on “merit”. Like most Americans, I came to believe that the civil service system was an unqualified positive development for American government, and the old system was corrupt, to the point of being “un-American.” In fact, on the radio this past week, I also heard a radio commentator refer to “patronage” appointments in a very disparaging way. (more…)

The Sunday, January 6, New York Times Magazine cover story was about the disappointing results of the electronic voting technologies implemented by many states after the passage of the Help America Vote Act, which resulted from the problems identified in the 2000 Presidential and Congressional elections.

I have always believed that government officials and businesses get too enamored of the latest and greatest technology, without recognizing and trying to retain the benefits of older technologies. Pitney Bowes has strongly believed that the most secure system of all is voting by mail, which supplements traditional paper-based ballots with state-of-the-art address management software and ballot tracking and tracing systems.

The biggest problem identified in the article was the quirkiness and unpredictability of computer-based systems, which fail in unexpected ways on election days, because of the large number of people using them. The kinds of misuse possible when tens or hundreds of millions of people use a system are not all predictable, and, therefore, not preventable. This Freedom to Tinker blog post clarifies some points made in the article in reference to this topic. (more…)