NDN Blog

Rebooting 20th Century Government: New Software Needed

Be it Boston water mains or BP’s oil drilling platforms, it sure seems like our basic systems for fixing problems -- from arcane Senate rules to silo’ed federal agencies -- are no longer up to the task. 

No surprise then to see a great front page article the other day in the New York Times documenting the deep frustration of state and local leaders with the broken pipes of 20th Century government, the inefficiency of fragmented jurisdictions and the lack of positive outcomes on the economy.   This witches’ brew is made more bitter by state funding shortfalls and red ink as far as the eye can see.

So how do we fix the federal-state-local economic development pipeline to water the right beanfields, do more for less, and effectively engage the private sector to deliver job growth for everyday Americans?

While tempting, we can’t just be China for a day and “decide” to put in 42 high speed rail systems overnight – and simply ignore nasty “not in my backyard” local siting concerns and pesky Congressional “pay-as-you-go” rules that stall smart infrastructure investments

Nor can we just expect entrenched interests to graciously stand aside as we propose eliminating agencies and programs in a political flourish.  No offense to the heroic reformers in the Times piece who had all tried and failed to re-arrange government in dramatic new ways (eg, cutting Nebraska’s number of counties in half, eliminating 1,000 township boards in Indiana), but overcoming 20th Century government and creating new bottom-up innovation won’t succeed by re-arranging the hardware of government on a white board.

We need new thinking and collaborative software to effectively re-wire our economic circuitry.

In policy layman’s terms, a basic strategy to modernize federal-state-local systems would:

  • Enable bottom up business plans -- not big guvment.
  • Create “go-fast” job-creation centers across the country to accelerate the deployment of a new, public-private pipeline for economic development and help America leapfrog past obsolete and silo’ed 20th Century systems.
  • Charter, fund and deploy a new generation of “distributed finance institutions” (DFIs) to drive our economic transition and directly support small-scale business and sustainable infrastructure projects with less federal red-tape.
  • Engage trillions in untapped union and public pension fund assets through federal credit enhancements to drive deep job creation and small business investment long after the federal stimulus runs out.
  • Focus on manufacturing opportunities (which studies show indirectly creates more jobs in a community than service jobs) through new incentives for local in-sourcing of key supply chains.
  • End top-down decision-making by just a few officials in Washington DC and empower front-line regional leaders through performance- and outcome-based budgeting.
  • Enable local and state innovation through web 2.0 tools and technical assistance.  EDA’s KnowYourRegion.gov site is a great step in that direction.

In the long run, we need to track which innovations and experiments are delivering the best results.  To lift up and scale the top approaches, we might consider adding one more commission to a growing list.  A Bottom Up Innovation Commission could identify the most promising reforms, implementation mechanisms and tough choices ahead for 21st century government, much like the successful base-closing commission.  One surprising co-chair to throw in the hopper: Tom Brokaw, whose surprising piece last year called for “cutting anachronistic and expensive local government structure that dates to horse-drawn wagons, family farms and small-town convenience.”  

Tom’s ready for the change.  Are we?

Rediscovering The Obama Narrative

The project of the next president is figuring out how do you create bottom-up economic growth, as opposed to the trickle-down economic growth that George Bush has been so enamored with” (Candidate Barack Obama, 2/2/08)

With all the recent angst in Washington DC about the lost Obama presidency now giving way to a fresh look after health care, one question keeps coming to mind:  

“If an Obama governing narrative fell inside the Beltway, or landed on 24/7 cable, would anyone really hear it?  One wonders.

This is not to give Team Obama an A-plus across the board on communications or implementation, but the notion that the President doesn’t have a core philosophy is simply ridiculous.   The problem is Obama’s governing narrative does not fit neatly into traditional boxes.  

Obamaism at its core is largely about bottom-up change rather than top-down dictates.  The reason: federal silo’ed programs and one-size-fits-all solutions don’t work well anymore.  The key to building new, innovation-driven programs, especially to turn around our economy, is finding, nurturing and scaling the best private and public outcomes at the point of effective delivery – in regions and communities.   

Growth, job creation and shared prosperity lies in creating opportunities for entrepreneurs and small companies to find financing, university researchers to find private collaborators and suppliers to find customers in virtual or real networks outside the DC Beltway.   That’s where we netted 40 million new jobs from 1980-2005, from young companies less than 5 years old.

Hence the unheralded Obama focus on bottom-up investments in US long-term competitiveness in energy and Electricity 2.0, broadband infrastructure and education reform to fertilize our future.

Hence the narrative disconnect between a Washington culture rooted in the mental confinement of Crossfire and its cable progeny, and an Obama governing strategy rooted in local geographies where post-partisan change actually is happening all the time.  

Now has the President gotten bogged down at times in allowing Congress to be seen as the main venue and benchmark for measuring “change.”  Yes. 

But let’s also give the Administration its due for trying to seed innovation that isn’t sexy enough (yet) to make a David Brooks column.  One thinks of the regional innovation work emanating from the Economic Development Administration and to catalyze new businesses and markets; the national competition to create a new collaborative center on energy efficiency and the built environment; and even little known parts of the health care bill like the new Center for Medicare and Medicaid Innovation which is pure bottom-up innovation, asking communities rather than drug companies to take the lead in developing cost-saving health innovation.  One should like that bet.

That said, the other half of the narrative is about the rest of us stepping up our game.   Too many of us have reverted to looking for magical answers at an imaginary “Window A” in the White House, or be surprised that Congress can’t pass a perfect bill. 

We need to be moving without the ball; not standing around and complaining with the pundits.  This is the path forward.  

We can start to boost up the bottom-up Obama economic narrative by lifting up those “ones we have been waiting for” -- the small business owners, the Governors, the school principals, and other community leaders who are busy pouring the wet cement on a new American foundation, beyond Pennsylvania Avenue.

How else?   Some communities and business leaders are moving forward on their own to create public-private job “war rooms” to accelerate the recovery, break down old silos and lift up a few signature job creation stories this summer to help people better "see" the recovery.  

Following the President’s lead, an expanding network of innovation-minded Democrats are advancing ideas to create a new, bottom-up pipeline for economic development and help America leapfrog past obsolete, “big guvment” programs, and instead launch "Little TVAs" to promote innovative, public-private pilots.  Former Governor Mark Warner, for example, is exploring new mechanisms to catalyze “cluster-driven” economics and industry creation, and the in-sourcing of smart manufacturing that focuses on local chain and workforce programming that effectively builds on local business strengths.    

NDN’s new Electricity 2.0 paper outlines a range of other, low-cost policy changes designed to unlock the economic potential of modernizing America’s decidedly inefficient electricity system --  as big a chunk of US GNP as health care.  Most of the big changes here can’t come from Washington, but from new innovative blueprints to creatively engage consumers, regulators and utilities.  

Another high-impact, bottom-up investment idea still below the radar?   To leverage billions in public & union pension funds assets that are now under-invested in local innovation, we could let local public and private stakeholders choose the economic development projects they want – with best-in-class federal criteria and oversight through local clean and green banks.  Perhaps paired with already proposed nuclear financing by the President, this would be low-cost, local control in the best tradition of Ronald Reagan and Grover Norquist.    

In the end, as President Obama understands, our recovery is tentative, and we need more creative thinking to jumpstart small business growth, bottom up jobs and accelerate private-led innovation.   We just need to get busy communicating the new lens which puts regional leaders, not the pundits, at the center of the conversation defining what we can do. 

Cross posted at the Huffington Post.

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