"PART" of the Solution: The Performance Assessment Ratings Tool
by Keith Miller and Alison Fraser
WebMemo #418
February 9, 2004
Released in concert with the President's budget proposal, the second set of Performance Assessment Ratings Tool (PART) marks are now available. The President's budget proposes that twenty programs either be eliminated or have their budgets significantly reduced because of low PART scores. While there is still great room for improvement, this first step is a good sign that the administration is starting to take public accountability of government spending seriously.
Finding Waste
PART, commissioned in 2002 and produced by the White House's Office of Management and Budget (OMB), assesses the purpose, planning, management, and accountability of individual government agencies. Based on an agency's response to the PART questionnaire, OMB evaluators grade its programs as "effective," "moderately effective," "adequate," "ineffective," or "results not demonstrated." "Results not demonstrated" indicates that are no objective criteria in place to measure the program's effectiveness; a failing that the PART evaluation process seeks to remedy.
To this point 399 programs--representing nearly half of the federal budget--have received PART scores. One hundred and forty-seven of these have been rated "results not demonstrated." Of the remainder, most have received poor marks. While the OMB judges the 232 programs with scores of above 50 percent to be "adequate" or better, the raw scoring isn't nearly so rosy:
PART Score # of Programs Grade Equivalent
90% - 100% 20 programs A
80% - 90% 56 programs B
70% - 80% 70 programs C
60% - 70% 47 programs D
50% - 60% 39 programs F
0% - 50% 20 programs "F-"
As the table above demonstrates, if these scores were children's grades, 59 programs would be flunking. Programs that have not yet received a grade may be struggling undetected, but by the spring of 2007, when PART's first 5-year cycle concludes, the entire federal government will have been rated.
The PART score is a very effective tool to identify which programs should have their budgets pared. While nearly every politician rails against "waste, fraud, and abuse" in government, it can be difficult to identify such spending items. PART points out where the waste is. Politicians can cut the failing or mistargeted programs knowing that they are cutting fat from the federal ledger.
The Ineffective
Programs graded by PART to be "ineffective," that is, those scoring under 50 percent, epitomize "wasteful federal spending." While the President's budget cuts some of these programs, it deals leniently with others: fewer than half face cuts and, overall, only 6 percent less money is budgeted to them - still $17.3 billion in total. This may be the beginning of accountability for federal programs, but in this time of record spending more forceful action may be in order. Ninety percent of the federal government performed better than these "ineffective" agencies. If the budget needs tightening, this is the place to do it.
Table: Ineffective programs
The Ill-Conceived
Another place to find candidates for cuts is among those programs that have a "Purpose and Design" score of less than 50 percent. Such a score indicates that a program possesses three of the following five faults:
The program lacks clear purpose;
The program does not address any specific need;
The program is redundant;
The program has a major flaw in design; and
The program fails to reach its target audience.
These programs, no matter how effectively managed or held accountable to standards, cannot be effective because they are ill-conceived. One example of this sort of program is the Advanced Technology Program (ATP). Although this program has good planning, capable management, and decent results, it only benefits wealthy corporations who could--and do, in other circumstances--fund their research without government money.[1] The President advocates terminating ATP in his 2005 budget proposal.
Still, the President's budget actually proposes that the government spend more on similarly challenged programs. Much of that increase comes from the mandatory spending for Veterans Administration disability compensation.[2] Under the President's budget, discretionary spending on purposeless programs would decline by 11 percent--from $15.4 billion to $13.8 billion--but there is room for much more to be cut.
Table: Programs without a purpose
Many Opportunities
The PART program could be a great aide to those trying to trim the federal budget. Although the tool is only two years old and has yet to address half of the federal government, it has already identified many targets for cuts. Taken together, its lists of ineffective and ill-conceived programs show many opportunities for the President and Congress to cut spending based on a systematic analysis using objective criteria.
While the President deserves praise for cutting programs poorly ranked by PART from his 2005 budget proposal, much remains to be done. If the administration and Congress are serious about holding the line on spending, cutting more of these programs would be a great place to start.
Keith Miller is Research Assistant in the Thomas A. Roe Institute for Economic Policy Studies, and Alison Fraser is Director of the Thomas A. Roe Institute for Economic Policy Studies, at The Heritage Foundation.
[1] For more on ATP, see Brian M. Riedl, "The Advanced Technology Program: Time to End this Corporate Welfare Handout," http://www.heritage.org/Research/Budget/bg1665.cfm.
[2] Since World War II, no study has been completed to determine appropriate levels of disability compensation. This lack of accountability is the main reason the PART score was so low. For more information see the VA chapter in the President's 2005 Budget, http://www.whitehouse.gov/omb/budget/fy2005/va.html.
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Social Security Reform: An Idea Whose Time Has Come
by Jack Kemp
Posted Feb 4, 2004
Before Ronald Reagan came on the scene, the Republican Party presented itself as the fiscally responsible party, which meant the Democrats had the political pleasure of spending money while Republicans dolefully raised taxes to pay for it - what one quick wit later characterized as being the "tax collector for the welfare state." Reagan figured out that not only wasn't that role politically successful, it also was bad policy and very harmful to the economy.
In his run for the presidency in 1964, Barry Goldwater had attacked the Kennedy tax cuts, which lowered the top income tax rate from 91 percent to 70 percent, as fiscally irresponsible. The economy boomed after the Kennedy tax cuts took effect. When Richard Nixon became president, he raised the capital gains tax in 1969, the economy tanked and the deficit swelled. Then he raised taxes again, implicitly, by taking America off the gold standard and allowing inflation to push average workers into tax brackets formerly reserved for the truly rich. President Gerald Ford also tried his hand at raising taxes and was promptly voted out of office.
It wasn't until Reagan offered a way out of the austerity box that Republicans regained their political footing and the economy recovered from a decade of stagnation. Reagan's great insight was that economic growth and the marvel of compound interest on saving put into productive investment is the only solution to the problem of big government. If the economy is flourishing and people have jobs, they don't clamor for the government to "do something" to ease their distress.
I never thought I would live to see the day when both political parties are clamoring for the fiscally responsible label. In order to feed the big-government beast, most Democrats insist on raising taxes, and too many of them refuse to consider allowing workers to place a significant portion of their payroll taxes into personal retirement accounts. Republicans, on the other hand, are reverting to the austerity rant, and while many of them want to allow workers to invest a small portion of their payroll taxes into personal retirement accounts, too many of them believe Social Security benefits must be cut to pay for it.
To my Democratic friends I would say the problem is not that tax rates are too low; the problem is that government spending is growing too fast. Moreover, we don't have to slash government spending to get it under control; we merely have to slow its growth.
To my Republican friends I would say scheduled Social Security benefits are not too high; retirees' incomes are, in fact, too low because the payroll taxes workers pay into the Social Security system are not put into productive investment in the private sector.
To both parties I would say the solution is not to raise taxes or, heaven forbid, cut Social Security benefits; the solution is to allow workers to invest at least half the payroll taxes into personal retirement accounts so that their retirement income can increase. Just as Reagan had to convince his party to take bold action to cut tax rates across the board in 1980, this president and the other presidential candidates must convince their own parties to take similar bold action today to reform Social Security.
I'm not alone in this belief. Former House Majority Leader Dick Armey and former Social Security Commissioner Dorcas Hardy are joining me as co-chairs of a brand-new coalition, the Alliance for Retirement Prosperity, that is embarking on a single-minded campaign to transform Social Security for the 21st century by making it possible for all workers to invest in personal retirement accounts at least half the payroll tax they and their employers currently pay (i.e., at least 6.2 percent) without cutting benefits or increasing taxes. And, rather than raising taxes or cutting benefits to pay the cost of transitioning from the old system to the new, we will work tirelessly to convince Congress and the president to restrain other government spending growth and to borrow the balance required to make the transition.
Joining me, Armey and Hardy as founding partners in this effort are some of the countries most influential conservative leaders and organizations, including CNN commentator Larry Kudlow, Grover Norquist and Americans for Tax Reform, Steve Moore and the Club for Growth, David Keene and the American Conservative Union, Art Linkletter and the United Seniors Association, Social Security guru Peter Ferrara with the Institute for Policy Innovation, the 60-Plus Seniors Organization, the National Tax Limitation Committee, the American Civil Rights Union, the Black American Political Action Committee, the Small Business Survival Committee, the Leadership Institute, Wall Street financial analyst Don Luskin along with Star Parker and the Coalition on Urban Renewal and Education.
We are energized and ready for this campaign to transform Social Security into a wealth-generating opportunity for workers and retirees. As the country learns more about this formidable coalition and its mission in the days and weeks to come, the American people will rally to the cause and make it their own.
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