Monday, July 13, 2009

The Problem with Big Government is in the Little Details

There was an enlightening article in the WSJ last Friday that has gnawed at me all weekend. The article was about how the State of California has sent letters to hundreds of the vendors who provide goods and services to the State asking them for a 15% price cut in order to help the State reduce its costs. It was not an especially momentus article, but there were certain things about the story that really stuck with me.
Meridian Food Services owner Rebecca Kitchings received a fax from the state's Department of General Services Wednesday night.

"We need your help!" said the letter. An attached worksheet invited the Riverside-based contractor to list ways she proposes to cut the costs of her $15,000 contract to supply cornstarch to prisons.

"Oh, for heaven's sake," Ms. Kitchings said in an interview. "It's a contract. If something happened to my company and I said, 'I mis-bid that and I need another half a penny,' they'd say no way."
Great point by Ms. Kitchings. Anyone who has ever worked on a government (state, local or federal) can recall just how unforgiving they are. Your bid is three minutes late? Too bad, you're disqualified. Made a mistake in your pricing. Too bad, you should've been more careful. Going to be one day late in performing the contract. Too bad, get ready to pay a hefty penalty.

Now, however, the State is in a financial crisis -- of its own making -- and they come crying to the hard-working vendors (who've already been bled dry by the State through their onerous contracts and pricing) and want them to foot the bill to bail the State out.
Among the contractors who got these letters are food companies, information-technology contractors that provide computers for state offices, and others. Mr. Lamoreux said companies that got the letters include Western Blue Corp., a technology consulting firm, and VanWrite, a consulting firm that trains employees on writing, for example, memos and emails.
This was the real "money quote" of this article for me. The State is actually paying a consulting firm to teach State employees how to write memos and e-mails. EXCUSE ME?? Talk about government waste. How many private employers could afford to stay in business if the people they hired didn't even know how basic communication skills?

What really frosts me is the hypocrisy and arrogance of politicians (everywhere, not just in California) who threaten to close parks, lay-off police, release criminals from prison, etc. because they don't have enough money.

OK. I understand that times are tough and government needs to cut back if they can't raise taxes. But, how about saving money by dumping these wasteful things like paying a consultant to teach state employees how to write memos and e-mails.

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