Lew Makes Room for Management Issues in Budget-Heavy Hearings

SOURCE: AP/Manuel Balce Ceneta

Budget Director-designate Jacob Lew testifies on Capitol Hill in Washington on September 16, 2010, before the Senate Budget Committee hearing on his nomination.

By John Griffith | September 21, 2010

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Incoming Office of Management and Budget Director Jack Lew could have easily filled his four hours of confirmation hearing testimony last week with talk of budget deficits and fiscal belt-tightening. Indeed, it’s tempting for any OMB head to focus on the “B” side of the agency, especially in times of fiscal constraint and economic uncertainty. It was encouraging, then, to see Lew also emphasize to senators the importance of improving federal government management.

To be sure, fiscal discipline was the recurring theme of last Thursday morning’s Senate Budget Committee hearing. Sen. Kent Conrad (D-ND), the committee’s chair, started by urging Lew to “focus like a laser” on long-term debt. Sen. Jeff Sessions (R-AL) lambasted the administration for setting overly lenient goals for reducing the budget deficit. And Sens. Patty Murray (D-WA), Bill Nelson (D-FL), and Ben Cardin (D-MD) all devoted much of their five-minute time slots to discussing strategies for long-term economic growth through fiscal responsibility.

Lew responded by emphasizing that good management is key to keeping government fiscally disciplined. “The management of the federal government is particularly important during lean times,” Lew said. He added that the federal government must “make sure every dollar (it) spends has the desired impact and makes a difference.”

Many aspects of Lew’s management agenda are consistent with recent recommendations by CAP’s Doing What Works project. Lew said addressing the deficit requires reforming a political process that makes it “very challenging to pursue ideas that might ultimately not be chosen.” He urged policy decisions to be grounded on “more knowledge about outcomes” and called budgeting processes that recognize the “need for midcourse corrections.” And Lew said that the current annual budgeting process “gives us precious little time to focus on program implementation, both in the executive branch and in the legislative branch” when Sen. Lamar Alexander of Tennessee asked him about his past support for a biannual process.

Lew focused even more on federal management issues during his afternoon confirmation hearing before the Senate's Homeland Security and Governmental Affairs committee. He said his top three managerial priorities would be information technology procurement, performance management, and federal contracting. "This is probably the most challenging undertaking I've ever looked ahead to," said Lew, 55, who oversaw OMB during Bill Clinton's presidency, a time of budget surpluses.

Lew expressed ambivalence about the 1993 Government Performance and Results Act, or GPRA, which was designed to improve the performance of government operations. When asked whether it had accomplished its objectives, Lew said, "I think it has helped." But he added that agencies feared GPRA's emphasis on reporting outcomes could be used punitively. The Senate is considering action on a bill passed by the House in June that could improve some of GPRA’s deficiencies.

Lew said one of an OMB director’s key challenges, particularly at a time of economic stress and budget deficits, is to not let budget issues dominate your time so completely that you lose focus on running government well. Still, much of the afternoon session was devoted to managing the deficit. The challenge facing Lew was evident in the seemingly competing messages he conveyed to lawmakers. On the one hand, "we should not be looking for massive deficit reduction" this year, he said. But he also warned that "unfettered deficit growth" is a critical threat to U.S. national security.

The Homeland Security and Governmental Affairs committee unanimously voted Tuesday morning to send Lew’s confirmation to the full Senate. If also approved by the budget committee and then by the entire chamber, the new director should make it one of his first priorities to investigate a recent decline in OMB employee morale, and take the necessary steps to improve worker satisfaction. To tackle the challenge of a lifetime he’s going to need all hands on deck.

John Griffith is a Research Associate with the Doing What Works project at American Progress.

More from CAP on OMB:

• Setting Goals for Government: The Senate Can Deliver This Fall by Jonathan D. Breul, John Kamensky, Jitinder Kohli, and Robert J. Shea
• Doing What Works at OMB by Jitinder Kohli
• From Setting Goals to Achieving Them by Jitinder Kohli