The government tells an 80 year old woman to wait a year

Posted by Marc Hodak on September 21, 2010 under Government service, Unintended consequences | Read the First Comment

No, this isn’t a story about health care (yet):

Lillian Daniels had the walls of her home in Detroit insulated in July 2010, almost a year after she had applied. The 80-year-old retired nurse practitioner had forgotten she had requested the help by the time she received a call from the community group telling her that workers would be coming.

The whole article here is like one long joke about how the government tries to help us with our money.

The basic choice in the “stimulus” was offering tax breaks to the private sector, including targeted tax breaks to certain industries, or to funnel taxpayer dollars through various agencies and community organizations with all the constraints they must face to maintain a semblance of accountability.

The state Department of Human Services and the Detroit agency exchanged several versions of Detroit’s advertisement before its language was approved.  It was January 2010, more than a year after the first advertisement had gone out, before the Detroit agency had a new one to post…

Along with the money came new rules that tripped up even officials familiar with the old program.

States were required to draft new plans detailing how they would use the extra weatherization money, which were then reviewed by the Energy Department…

Weatherization isn’t the only stimulus infrastructure project slowed by bureaucracy. Awards worth $8 billion for high-speed rail connections were announced in January, but the Federal Railroad Administration has only distributed 7% of the funds to date… Few recipients of awards to expand the nation’s broadband network have actually started laying cables; the rest are performing work such as environmental assessments and getting local approvals to attach fiber to utility poles…

Much of the blame goes to new rules pushed by organized labor:

A major reason for delays in the program was a provision in the stimulus bill to apply the Davis-Bacon Act, which requires that workers be paid the local “prevailing wage,” as determined by the Department of Labor.

Democrats have routinely sought to apply the Davis-Bacon Act to federal spending, supported by labor unions, who say that contractors would otherwise be encouraged to lower their bid prices by cutting workers’ pay. Opponents say that the act is inefficient and inflates costs.

In this case, it was far more inefficient than inflating, but it certainly increased costs for everyone involved in terms of delayed employment.

The snags in launching the weatherization effort left construction companies in limbo.

“We didn’t think it was ever going to happen,” said Darnell Jackson, owner of Detroit’s Ampro Construction, who had to lay off three of his eight workers last year.  He has since hired them back, and added seven new workers.

Many other construction companies in Detroit are still expanding slowly.  Some have slowed down the rate at which they take on stimulus work, because they can’t afford to pay workers weekly, another new requirement in the stimulus bill’s labor provisions…

For newly trained workers, the delays have been hard.  Jennifer Wallisch, a 30-year-old former auto worker, hadn’t had a steady job since 2004. She enrolled in a course run by the non-profit WARM Training Center in January after hearing about the $30 million of stimulus dollars that Detroit was getting for weatherization.

She studied energy-saving principles, practiced drilling holes into walls and blowing in insulation, and learned how to install windows.  She graduated in March, at the top of her class.

For the next four months, she couldn’t find work.

“I was hanging on by a thread,” said Ms. Wallisch.  In July, she was hired for energy-conservation work funded not by the stimulus plan, but by Michigan’s utility companies.

One can go on, and the article does.

Lesson:  When a private company can’t get its act together, it eventually fails, succumbing to better managed competitors.  Competition raises everyone’s game.  There is no competition for the U.S. Department of Labor, or Health and Human Services, or Energy.  The government can’t go out of business.  If the providers of government capital (i.e., taxpayers) don’t like the return they are getting, the best they can do is choose another president in a few years, or pressure the current one to appoint a different department head, call their congressperson, etc.  That’s not exactly zero accountability for performance at the agency level, but it’s pretty close to it.