Posted by: knightbird | September 19, 2015

Alaska’s Fiscal Future Without Lean Government

In the past couple of months, I have attended a number of conversations about Alaska’s fiscal future. And I have read a few proposals put out by various organizations. Today I attended a Forum, but left early. For 35 years, I have been hearing about government reform. And I hear and read a lot of comments like: we spend too much, we tax too much, we have freeloaders who need to pay their fair share and we need to cut our budgets. I hear very little thoughtful analysis.

Today I heard some decent analysis, but it was far too political for me. We have serious problems we need to address. In a serious way. One comment made at the forum was to put a tax of sugar drinks because they lead to a heavy cost burden on our health care system. I know the comment is well meaning, but it’s ignorant. And the comment came from a highly educated and very competent statewide leader with decades of experience. I also heard praise for the Native community and how well we do things. Yet Alaska Native suicide rates are the highest in the state, our men institute almost 40% of our prison population, we are a significant portion of the homeless in our large urban areas with high rates of alcoholism and other behavioral problems. Our health is terrible, according to our healthcare leadership, and we need huge increases in funding for behavioral health programs and rehabilitation centers.

What do I mean by serious discussion? That’s easy. It’s one that is based on data and not on representations that cannot be proven. Lean Management uses data, and improvements are based on science, observation and continuous improvement. I envision the same process for addressing our fiscal crisis.

Among the topics brought up today was a reduction in education support. Alaska spends well over a billion dollars on education. We have an incredibly high dropout rate, and lots of behavioral issues that need to be addressed in schools. Every dropout adds costs to society for a variety of reasons (http://ndpc-web.clemson.edu/statistics/quick-facts/economic-impacts-dropouts). When we don’t consider the costs to society of our actions, we effectively distribute the losses in a way that harms society. When we don’t invest in education, we end up investing in criminal justice. In Lean Terms, I refer to this type of result as feedback loops. Less education, less income. Less income, less contribution to society. Higher service costs. High school dropouts, for example, have more health problems.

When I attend a public forum, I try to spread the gospel of Lean Thinking. What’s interesting is that I might get a glimmer of interest from some, but not often. A politician will usually listen, but try to find a way to exit the conversation quickly. Regular people find the first excuse to exit. One in dozens will actually want to hear more.

The promise of Lean Government is not that it will save us money. The promise of Lean Government is that it will preserve enough of our programmatic reductions to forestall some of the lost opportunities we would otherwise experience. If we have to cut half a billion in expense, but we can preserve the level and quality of service, we don’t end up with some of the feedback loop costs. I want to explore some of these costs in future posts.

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