Subscriber Benefit
As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe Now
Could it be that the party is finally over?
The party I am referring to is the decades-long federal spending binge that many economists argue is the single biggest threat to America’s future. Today’s federal deficit is $36 trillion and is at the highest percentage of debt to gross domestic product since World War II. We are now spending more on interest payments to service the debt than we spend on our national security.
While it is certainly too early to claim that Washington politicians will curb their appetite for spending us into oblivion, a little optimism is in the air. Suddenly, government efficiency seems to be back in vogue following the flood of federal dollars that reached a crescendo with pandemic stimulus funding. After years of both political parties refusing to rein in expenditures and cut the size of government, there is momentum to do just that.
President Trump, of course, campaigned on the failures of government and promised that if elected he would create the Department of Government Efficiency to downsize government and eliminate government waste and corruption.
Trump initially tasked the Elon-Musk-led effort with trimming $2 trillion from the federal budget, likely an unrealistic goal given that the bulk of the federal budget is spent on entitlements such as Medicare, Social Security and national defense. But the early action by DOGE to identify fraud, reduce reckless spending and reverse the growth of unaccountable federal government agencies is encouraging.
The movement for a more efficient government is also being championed at the state level. Long a lonely proponent of reining in federal spending and reducing the national debt when he served in the U.S. Senate, now-Gov. Mike Braun is taking steps to reform state government and cut spending.
Shortly after winning the gubernatorial election, Braun announced plans to restructure Indiana’s executive branch when he took office. The new cabinet model reduces the size of the governor’s cabinet from dozens of agency heads to only eight policy secretaries who each oversee multiple agencies. The move is meant to better align agencies to accomplish their missions and the governor’s priorities more efficiently.
For example, agencies that are directly engaged in economic development functions now all report up through the Indiana secretary of commerce. These agencies include the Indiana Economic Development Corp., the Department of Workforce Development, Elevate Ventures, the Ports of Indiana, the Indiana Destination Development Corp. (the agency that oversees tourism) and a new Office of Entrepreneurship and Innovation. Aligning the missions, outreach and communications of these key economic development agencies has the potential to not only improve economic development outcomes, but to do so in a more efficient and cost-effective manner.
On the spending front, the governor immediately began implementing his campaign promises by directing his new cabinet secretaries to cut spending at their agencies by an average of 5%. The cuts across state agencies add up to approximately $700 million over two years and help pay for an increased Medicaid burden, education priorities and tax reform. The forced spending cuts across state agencies have the added benefit of encouraging the new cabinet secretaries to look for and eliminate wasteful or unnecessary expenditures, much like the DOGE effort on the national level.
The ballooning size of government and spiraling deficits are serious threats to our economic vitality and freedoms. Let’s hope this moment of government reform and fiscal austerity continues for more than a passing moment.•
__________
Feltman is publisher of IBJ and CEO of IBJ Media. Send comments to nfeltman@ibj.com.
Please enable JavaScript to view this content.