New Year's Resolution: Keeping Government Accountability

for those of you who are unfamiliar with the r Center we are a nonprofit University based research and Outreach Center designed to help connect policy makers when academic resources help them in discussing important issues we host many of you the seminars on the hill quite often so please keep an eye out for future events and if you still on the table in front of you we're actually having another event in about two weeks on the Department of Homeland Security so I hope that you'll be able to join us for that or forward it to someone

in your office who have is always great um and as a final reminder please take a minute to fill out the feedb forms that you in front of you because we to help us evaluate our program so that joining us today is The Honorable Morris M who works for the center as the Director of the government accountability project and is also a distinguished visiting scholar he from New Zealand where he tells Physicians as a member of parliament in the New Zealand government u a cabinet minister and the chairman of the ex control board um after

that he served as an ambassador to Canada and has received the queen service order award which is one of New Zealand's highest awards for civil servants he now writes and speaks to policy makers on open government government accountability and transparency issues and on the federal and state so please welcome The Honorable thank you Maran and uh I've been visiting the hill now for about 10 years um but I live just outside the Beltway so I'm not consider to be Washington Insider or at least I make those claims um I'm not responsible for the title today

MaryAnn's responsible for that and I think it's actually quite clever uh so it looks like it's a girl it's a week when the girls are going to be Supreme and um if you leave early then I'm going to try not to cry one of the things that I've spent a lot of time on in the last 10 years is this issue of accountability and and uh it's something that's attracted attention all around the United States as we find legislatures right across the United States are struggling with this issue of accountability and so are the public

in recent months we've done quite a lot of work in Louisiana and one of the very interesting things about Louisiana is that the governor who assumes office next week uh was elected uh not at the election uh but at the primary uh when he won more than 50% of all of the votes cast at the primary uh and therefore was entitled to move straight through to becoming Governor but the thing that I've interested in in terms of what governor elel did during his campaign was that he focused almost entirely on openness transparency and accountability and

most of us know that Louisiana is a place that probably has had a deficit of those things in recent years or maybe recent decades um but that was so popular that it enabled him to actually win on the primary batt when we look at accountability um we actually find that uh the more open and transparent the activities of government are the higher the levels of confidence there are in government and um that really is antic when we think about it yes if I actually know what is going on then I'm going to be uh more

confident or perhaps we understand it best if we reverse it the thing that secrecy does is make us suspicious and legislatur have a tendency to Rel relapse into secrecy too easily and too often and every time something happens in secret it makes us suspicious about why did they have to do that behind closed doors clearly there's something that they don't want me to know uh or there's something that they feel guilty about uh in many instances that isn't the case but one of the problems that we're seeing with legislatures and with governments at the moment

not just in the United States but in many places is that there is a perception of corruption because of secrecy even though the corruption might not exist and where that perception exists then the perception becomes the reality that's what the people think and to be able to correct that then you have to change those perceptions so clearly a move towards openness and transparency would help to build uh a comfort level for the public uh and confidence but if we take that a little bit further the next comment there the greater the transparency of government processes

and procedures the better the decisions and less possibility of the perception of corruption also takes us to the next stage there are a number of legislatures in recent um in the recent period probably the last 2 to three maybe four years who have tried to pass ethics legislation my experience in politics and as a legislator was that it is extraordinarily difficult and normally fails when you try to legislate morality we actually should know what's at what age do you think the kids start to learn the difference between right and wrong four yeah I'd say the

same too anybody go lower I think sometimes at 2 or 3 you can see kids are starting to tell they know what's good they know what's bad uh and as we grow we build more and more of a set of values based around that right and wrong if we actually want to change Behavior then we're better to call fall back on those values and put people in a position where they have to respond to those values rather than trying to write prescriptive rules ruls that says exactly what it is that you can do and what

you can't do so openness and transparency really help uh to produce those results very effectively when we started to work on accountability what we found was a the word exists in the English language doesn't exist in too many other languages it doesn't exist in French for example which might surprise us um in other languages you got to use many words to be able to get at the meaning of it accountability but what we also found was that the even though we think we know what it means uh there wasn't any good definitions so we created

this definition uh accountability is that process that requires us to disclose fully and truthfully our performance to those who are entitled to know as fairly worthy but we did that deliberately because we wanted a definition that would hold up in all circumstances not just when you look at government uh and we think that that's what happens when we use this definition anybody wants to argue with just stick your hand up and and have it EV immediately um there's a number of components of that definition that I think are important it actually says requires to disclose

it's not a matter of choice uh you can't just make up your mind well maybe I'm going to disclose this time and I'm not next time uh and that requirement means that we have to do it in a way in which those who you are disclosing to are able to find that information um one of the things that we found when we were looking in Lou Louisiana and some of the things they were doing there was that there's a requirement for departments to produce annual reports uh what some of the Departments did was produce the

annual reports and put them straight in the archives uh now not too many people would think of looking in the archives for this year's annual report or this year's information that doesn't sort of meet the criteria of disclosure uh so disclose is important and to disclose means that it has to be done in such a way that people can access it and when they access it they can actually understand it it's readable we conduct another project each year that probably some of you familiar with we call it our scorecard and it looks at uh the

performance reports of all of the major government Department each year the 24 uh CFO act agencies and what we look at in that is the quality of disclosure and one of the first of the criteria in that quality of disclosure is can you actually find it uh and what we do is that we U we say that it should be able to be found on the website of that agency and you should be able to access it with one click that's accessibility the second part of that criteria is having found it can you read it

and when we started that project 9 years ago when the government performance and results act took a we found that many of the reports weren't readable they were readable maybe if you were an Insider and perhaps some of the people on the hill would have been able to read them and understand them but an ay citizen wouldn't have been able to pick it up if you took the report of say NASA it was clearly written by engineers and we got long strings of words that I'll guarantee that no person in this room would have a

clue what they meant they composed part of the reporting of NASA that's not transparency it has to be written in a language that we can understand as well as being accessible fully and truthfully it's interesting too um most of my education was done at the hands of nuns so if you think that they're nice kindly people then you are wrong they are cruel and very hard uh but they do make you learn and and um and one of the things I can remember them teaching us about was lying not how to do it but what

constituted lying and that there are really about four major elements to line uh the first one is uh to deliberately tell somebody something that's untrue so that's Lying by commission um Lying by our mission is to leave out some of the information and I know having been a a minister cabinet minister which is a the same as being a cabinet secretary here uh that often your agency would answer requests of members on the basis of we will answer exactly what you asked uh but we won't volunteer any more information U because you didn't actually ask

for that uh that's Lying by our mission uh you're leaving some of the information out deception is allowing people to continue to believe something that you know is not true and I forgot what the last one is so I just fa doctor class again um so when we say fully and truthfully it means that in disclosure there has to be sufficient information provided for you to be able to make an assessment of whether this activity is satisfactory or unsatisfactory um and our performance really Rel relates to the results that occurred from whatever it was that

we did governments universally are bad at doing that they are very good at telling you where they spend money and how much money and what activity they commissioned but they're not good at telling you what happened as a result I can look at you education spending but I can't actually find out how many children are now reading at their biological age as a result of the expenditures that you put in place and whether or not that's an improvement on the year before or not some time ago I sat down with the SEC uh with at

the invitation of the Office of Management and budget to look at their measures and what they measured was how many people they found uh who had transgressed against the rules um how they were able to resolve that whether it was went to a court case whether they succeeded in the court case how much money they got in terms of a settlement Etc when I said said to them tell me is their behavior in the marketplace now better or worse than it was a year ago better or worse than it was 5 years ago better or

worse than it was 10 years ago answer don't know you see that's actually the thing that I'd like to know the fact that they managed to pick out some individual behaviors and prosecute them tells me that they managed to pick out some individual behaviors and prute them I don't even know whether they're Prosecuting the worst offenses they couldn't tell me whether things like insider trading was getting worse or better now in the absence of those results we don't actually know whether or not we're getting a good deal from the SEC we might think when we

look at it on superficially yes we are uh but if there's a hell of a lot more stuff going on like Enron we don't know about it uh then they're not doing a good job and and frankly I would blame the SEC for some of the things that happened around en if they've been doing their job in disclosing properly then I think it might not have happen uh and then the p b is to those who are entitled to know because this is a general definition uh it's meant to take into account all circumstances so

if I'm the CEO of a company um I have to disclose to my shareholders uh and I have to disclose to my board but I don't necessarily have to disclose to everybody yes that's why private companies don't have to disclose to the public in general um if I'm the pastor I'm accountable to my Parish uh but I'm not necessarily accountable to the rest of the community or if I'm a parent I'm accountable to my children but I'm not accountable to the neighbor's children but if I'm a member of parliament or if I'm a member of

Congress then I'm accountable both to my district and to the people of America and I think that those are important distinctions that we are accountable we are accountable to those who are entitled to know and if we are a member of a legislature then it is not our legislature that we're a member of it's the people's legislature it belongs to them and they're entitled to know so why does accountability work well if it's properly constructed accountability creates see this and what I really want to do is make a short comparison between what I call uh

command and control which is we will write for you the Ten Commandments and you must follow them word for word uh or creating incentives uh and incentives really rely on the Integrity of the individual by saying that um what you are doing is now been going to be a subject to the the scrutiny of the public at large and they make judgments about whether or not this is good or bad behavior it's a much more powerful mechanism than the command and control uh for example if you write a new law that says Thou shalt do

all of these things what you do is that you define for me what's good and bad awfully hard to do uh if I can find ways of stretching that rule to get my current behavior in by De is still good so I'm allowed to do it uh it's much better uh if you just say to me what you do is going to be subject to the review of everybody else and then Society is going to make its judgments about whether or not they think that's good uh and may view that's a much more powerful incentive

than going down uh the road of uh we will um Define exactly what it is that you should do there's a quote from Ronald reagen that I love um and at some State at this particular point in time he must have been very frustrated with Congress U because he said I hate to think what would have happened if Moses had taken the Ten Commandments to Congress before uh he released them um and that's probably true of most legis legisl Simplicity tends to produce the best results I think one of the reasons why your Constitution has

been so robust for so long is that it's a relatively simple and straightforward document that defines a number of important principles but doesn't go into all of the detail of how you should interpret them the European Community tried to do something like Institute a constitution like you some time ago was called the masterc treaty um it got to 478 ages uh and apart from the French and the Italians and the Germans nobody else would sign it uh and you can understand why uh because the more complex becomes the more likelihood likely there are going to

be um objections so every constitute accountability in the right way by using transparency then it triggers U these particular Concepts we have a natural inate ability that we want where we want to be thought well of by our peers your little children when they're very very young want to be thought well of by Mom and Dad and that's what actually exercises most of the discipline on their behavior when they do something wrong they know it upsets Mom and Dad uh then that disciplines how they're going to respond the next time but also as we get

older uh the knowledge before we act that whatever it is that we're doing is going to be subject to scrutiny also disciplines how we act so maybe when your kids get to teenagers they're more disciplined by thinking if Mom and Dad finds about out about this is going to be real trouble uh and so on as we go through life and and develop responsibility for uh more important issues now I'm going to show you some sort of pictures oh sorry what there something there the definition when you think about this definition that we we've designed

here it actually works in the relationship between husbands and wives uh between children with their parents and vice versa it works between Pastors in their Parish it works between CEOs and their shareholders but it also works between um members of Congress in the district and congress with the American public so Works through all of those situations so we think it's a robust uh definition this is taken from the economic freedom index it's a study that's been going on for 40 years now and the only thing that's important here uh for my talk today is the

fact that um the most free and open societies are the are the ones that are most successful uh there are many examples of societies that weren't free that have moved to become open and free places like Hong Kong and Singapore uh were very poorly performing societies immediately after the war uh but through good leadership and good governance they became part of the world first world uh they went from having very low populations to 180,000 people in Hong Kong in 1948 6.5 million people in Hong Kong to Hong Kong having an area that is half the

size of DC 65.5 million people and one of the most prosperous societies on Earth uh but then you can also look at the other end of the scale over here and think about the East Brit uh and you can think about some other comparisons in between think about South Korea and North Korea really the same country arbitarily divided after the war one's been highly successful and the other hasn't um you can actually Google the world and look at it um and you can see there's a dark spot U that dark spot shows North Korea because

that's one of the places where the ls are never on uh and the rest of the world you can see the flickers of Lake uh an indication of the significant difference between those two countries one being very open and free and the other one being tightly constrained uh or you can also go to places like what used to be Rhodesia and it's today Zimbabwe one of the most uent parts of southern Africa as rodesia was the Bread Basket of southern Africa and fed most of the people uh and today it can't even F feed itself

been disastrously LED it's a very closed Society a very repressive Society under President thei so that's what actually happens openness and freedom create creates prosperity and a desirable Society to live in uh and repression and secrecy creates just exactly the opposite okay for those of you on the other side if you're difficulty reading that this is uh this is actually the Congressional approval ratings between January of 97 and December of uh 2007 and you can see the red line is actually the disapproval rating and the blue line is the approval rating Congress actually has a

crisis of public confidence at the moment this is a disastrous situation if you look more deeply into these issues uh of why that's happening what we actually find is that uh there is public disapproval or a lack of confidence in the institution of Congress itself still quite good readings for members of Congress but they have deteriorated as well uh and there are a number of things here that's happened in this period of time that I think has damaged public confidence and there are things like secrecy uh there things like bad decision making there things like

ear marks which have all tended to destroy public confidence I don't think you'd have an argument about ears if they were totally transparent I think you have a big argument about them when they're secret because it's really saying to you and me what's going on that people don't want me to know about um if you actually look at these spikes I think that one there is probably the surfus or it's the end of the Linsky thing one of the other of those um this one here is 911 uh and this one here bad behavior seeing

I'm not an American I can always leave if people get really upset with me um here the the graph for presidential approval ratings and um what you can see here is a major spike uh for 911 uh and then a deterioration uh over time which is clearly public concern about the war on terror uh and Iraq now if we look at the next one it puts Congress and the president together and you see they can pretty much track each other uh but all the way congress's approval rating is under that of the president we're only

looking at the current president um because that's from 200 um from 97 9697 through to 2007 but you also notice that they're going in opposite directions here again uh and you'll notice here this is the change in leadership in the house uh which saw a a peak a lip in public confidence but then a deterioration again um I might as well get in a whole lot of trouble with a little bit I blame blame the leader of the senate for that I think Reed was responsible for not going along with what the uh the house

wanted to do in terms of Ethics reform and public confidence dissipated again very quickly it was it looks like it's back to business as usual again and more cooperation between the house and the Senate might have seen that not happen here's just a way of perspective going back a period of 15 years and the reason I put that one up there is that takes uh a Democrat majority to a republican majority back to a Democrat majority and parties don't seem to make any difference from 94 through there was a lift uh in confidence during the

Republicans it was dissipating uh and then 911 had an extra ordinary event the the public were generally pleased that Congress and the presidency got together and made decisions that needed to be made um but then it quickly fell off again um and the last one of these pictures is so what was upsetting um the voting public at the time of the last election in 2006 and uh you can look at these bars here the biggest one was uh at perception of corruption uh what's interesting is that the Iraq War only came in as number five

that's interesting uh but this is an issue that is fixable and my view it's more about perception than reality and the only thing that will change those perceptions uh is if Congress is more transparent okay honesty integrity and accountability in government um first thing is it's the people's government so there's an entitlement to know uh and it's only in those circumstances where it would be contrary to the best uh interests of the nation that stuff should be kept confidential uh it would be good if we started from the concept that everything is public information unless

there is a good reason for it being made confidential sort of turning that on its head you got to find a good reason for saying that this information won't be released many governments around the world have moved to that Concept in recent years uh through their Freedom of Information laws and so forth saying that it's all public information unless you can a good reason and that that reason is often testable um through some kind of an authority either going to court going to an onsman or somebody like that who can make the decision about whether

or not deciding to Make This Confidential was justified under the law um I just want to touch briefly here on knowing and Publishing what results cost that's something that governments aren't good at doing and they're starting to make some changes about that we actually know what we spend on things but what is it cost to make it to move a person from dependency to Independent Living you spend a lot of money on things like tan um but are you actually making more people independent or are you actually just locking the current people into dependency uh

by feeding that dependency year after year see one of the things that we need to do is to start to drive information towards Solutions rather than perpetuating the status quo unless we get the right kind of information then we tend to just perpetuate the status quo and part of that is well if the cost of doing this is ridiculous we got to find a better way what is it cost to place a person into work uh through vocational training programs you place about 2.8 million people into work each year uh in the United States um

the most expensive program does that at a cost of 30,000 per person um and the most effective but the least expensive programs do it at about $570 a person so why do we put money into one program of $30,000 uh instead of putting it all into this other program that would make many more people um employed actually if you took all of the money you spend on vocational training $8.4 billion uh and you put it into the most successful programs the number of people you put into work would be 14.7 million instead of 2.4 same

money those are some of the questions that are going to be asked in the coming decade as we start to review what's the public benefit we're getting for the investment that we're making and is this the best possible public benefit we can get from these resources there is nothing Divine about a program it is a tool and like all tools Superior tools are developed over time when that happens we should abandon the old tools and use the new ones government we tend not to do that one of the reasons is because we often don't know

exactly what the costs are we look at some of the big ticks in recent times um these are some of the things that I think Congress and the administration have done well I think that this is a Visionary piece of legislation uh the federal spending transparency and accountability act uh how many people in the room have actually visited usaspending.gov one two two 3 four now all of you should have a look at it it tells you exactly how the federal government is spending your dollars um buy activity and buy buy in contract or buy all

of those sort of things uh it's a pretty good website and uh it's relatively easy to use it's only been up for 4 weeks we not just before Christmas but it's there and it's going to be continually updated um but that's good stuff we should see that that kind of stuff is increased and enhanced uh and it shouldn't be taken away by a future Administration here's something new that's going to happen budg of justifications are going to be placed on the web uh on the 1st of February those are documents that used to be secret

uh now om has decided that there's no real justification for them remaining secret that we should put all of the information out there I think that's extremely good too that's a big tip um here's another one right from the very beginning the results of the program assessment rating tool have been up on the web anybody ever looked at them yep four of it there's really good information there about what programs work well and what ones don't and if you're involved with those committees or your members involved with those committees you should actually know this stuff

you see my view it's wrong to put money into things that don't work uh and this is the first tool that the US federal government has had that actually tries to work out whether programs produce what we think they should or not uh and that's something that should be continued and enhanced we could add to that some of the work that's gone on with GPR and the reporting of government departments and agencies that's certainly increased increased trans transparency as well um so what are the big crosses the big crosses are secrecy any reversion to secrecy

um the secrecy around emks is easily fixable in my view it's going to rankle a bit with people but it's easily fixable one of the stick your name on it um and let's see that it's out there in the open um it might change what actually gets to be an emac in future that might be a good thing too um here's one why does that actually have to be done in secret would it be interesting if you actually had that meeting in a meeting room um with the public and television press um be interesting to

see what the tradeoffs were that were going to occur between uh the house and the Senate to get legislation through um I suspect from time to time and some of those Traders have nothing to do with the legislation on the table um maybe that's not appropriate that was done in and and the open then perhaps that practice would would change so why is accountability less successful with governments um the answer is that uh government accountability is incomplete because it tends to to account just for where and how you spend money rather than putting the rest

of the equation in what happened as a result and because you don't put the rest of the equation in or you're only just starting to put that information in it's very hard to make judgments about was this a wise investment or wasn't it or could this investment be done in a better way so it may you currently one of the problems with the Congress is the fact that it doesn't have the transparency that will build cut public confidence and it needs to move rapidly towards doing that uh and we the people notice that and we're

not happy about it so what are some of the BRS of public confidence uh in my view uh it's having an an agenda what is it that you're trying to do pretty hard you know every agency inside the government has to produce a strategic plan the government doesn't have to produce a strategic plan maybe some of it's in the state of the nation address but not all of it's in there something that David Walker has been talking about for a number of years now as part of GPR that's missing there is no overview uh of

what it is the government's the government's trying to do a number of countries around the world are now requiring that their government do that and that they do it over a significant period of time uh they have to produce a statement each year that looks forward 10 years what are the things we expect to achieve over the next 10 years um so one of the things that damage public confidence and um they're not completing the agenda making commitments to things and not getting them done uh I was in Canada at the time when the Republicans

launched the contract with America um and I listened to that I thought it was exciting and because I'm interested in politics I followed and uh I talk to many Republicans who tell me the contract with America was completed and if it wasn't my View getting a vote on something's not getting it done there's a difference between that I heard dick Army on a number of occasions say we got votes on all of these issues so what um what we wanted was to get it done uh so you know that's not getting the agenda done um

setting aside the rules is something that really upsets the public uh and the house does that from time to time it's not a good thing to do uh lack of transparency and then here's something that actually the politics of admitting when a mistake occurs is a damn good thing to do um you find that if if the somebody admits that then the response or the confidence goes up immediately the best organization in Washington and my view of doing that is NASA ner is very good at creating high expectations about what it is that they're going

to do then during the mission they will work carefully to try try and pull down those public expectations and then if something goes wrong they come out and tell you about it straight away people say wow well it was pretty tough to do that funny little thing fell down at Chasm on Mars U they told us that fell down Chasm on M and then they told us actually in the end that that happened because someone screwed up between using Imperial measures and metric measures um that was pretty honest but you know people gave them a

pass on that because they were open and transparent and admitted the mistake so admitting mistakes are good things to do here's what some other countries have been doing and uh that's page okay uh in the case of uh of New Zealand they passed something that was called a fiscal responsibility act uh and what they did was require by law for the government to give reasons why they were running a deficit how long the deficit would continue for and how they were going to move from deficit to Surplus again and when they would have repaid the

debt that occurred during the period of deficit that's the law since that was passed uh New Zealand's never run a deficit because before you can run a deficit you actually have to go to Parliament and explain why it's going to happen and then ask for permission for it to occur governments don't like doing that the consequence of that is that New Zealand has retired all its debt it's a debt pration no foreign debt no internal debt um because it's run surpluses for that long uh the oit pass something that was called the honesty and budgeting

act uh and that was because much of their financial information didn't tell the full Truth uh it told you the cash counting difference between what was spent and what came in but it didn't tell you about all of the other intangibles that have blow the line owns uh so they passed that so that now there's full transparency uh in terms of what's going on the British passed a a law that made the Departments of the government focus on outcomes and every 3 years they have to do a prospective forward for another 3 years on what

outcome it is that they're addressing and what progress they will make in public benefit terms pretty good stuff both Australia and the UK have done something else that I think is really good and that is that they now have requirements for intergenerational reporting what that means is that they now have to account for what is going the impact of current policy looking forward 40 or 50 years see 2 or 3 years ago um Congress passed some changes to Medicare uh and if you looked at it and the cost in that year and the year after

it didn't look much but as you get through uh to the Next Generation those become horrendous costs uh and they were pretty much masked if you look at Social Security nobody wants to look on 2015 or 2016 uh but there's a lot of young people in this room that are going to be picking up the bill for that uh so that people with gray hair like me can get Social Security but that bill might become so horrendous that you don't get it a lot of young people know that uh so that if there was honesty

and transparency there there would be more being done now to fix the problems of Medicare and Social Security than has been done the Australian the Canadians passed something that's called the government accountability and transparency act and requires by law that bu of the stuff we've been talking about must be made transparent uh You' got 20 States at the moment that are passing transparency laws somewhere in that process so there's a trend uh for more of the Obama CL kind of legislation that makes the the government more transparent to deal with some of these problems the

government of New Zealand back in 1987 88 actually reformed the entire Parliament because I know that many of you people say hey this is never going to happen uh I just want to tell you that I can one of the parts of those reforms was that all of the old committees um really had nothing whatsoever to do with what the government does today they were a u they went back to the beginning of the previous Century uh and they stayed that way because the parliamentarians like them well all of those were changed and all of

the Committees of parliament became seal committees and every issue on education went to the education committee it didn't matter a DME what department was dealing with it and every issue on Commerce went to the Commerce Committee uh and so on so that you knew exactly where it was those committees buil buil high levels of expertise and those issues but they also knew exactly what was going on in total it wasn't hidden because it was in some other committee that they never touched just makes sense uh at the same time it also Al instituted something that's

called the regulations Review Committee because one of the most dangerous powers of government is the power to be able to pass regulations and that's done by people who aren't elected and that scares me uh so part of that U reform means that all regulations have to be confirmed by the parliament so in the end elected representatives have the responsibility for saying yes or no to those things that restrict your and my Liberty to be able to do what we want with property uh and things like that uh so there are reforms going on uh around

the place these are what I would call a good government agenda a government that makes budget decisions based on results and some of that is coming through part but it needs to be better uh and it needs to get attention from legisl from appropriates whether the problem program works or not should be the first question that would be asked by appropriators uh the government is honest and truthful future Generations by requiring intergenerational reporting on current policy budgets don't go far enough forward part of the reforms in New Zealand was to make every budget look forward

10 years and back five so that you had a 15-year picture uh and it put by going forward 10 years you see what the consequences will be of current policy uh in 10 years from now U the Australians and the British have extended that even further now with their intergenerational reporting by looking at some things 30 40 and 50 years out that's just a spel about deficits deficits do matter you can't run them forever if you can just try it with your bank manager um try it with your mortgage um and every other aspect of

our life was expected that sooner or later we're going to actually pay the bills so what would be good and my view these are the things that would be good we need to have results transparency what happened as a result of the money we spent are we safer or less safe you have a hearing on um or a meeting on Department of Homeland Security uh I've sat in on some of their sessions from time to time on their measures um they're starting to come towards it but what we really need to know from the Department

of Homeland Security is are we safer L safe if we're less safe what cses do we left safe safe and how you going to fix it and we get lots of other measures but not those um financial and purchasing transparency youve got the purchasing transparency but some of the long range Financial transparency doesn't exist as yet that could be improved program performance and results are starting to come through from part and that's good um and of full public process uh you do pretty well uh and we designed this whole concept because we're going to look

at state governments on the basis of good governance and some of these processes and procedures are things that You' expect to be in place the last one no regressive Act is that uh sometimes governments do things uh that really aren't good um the worst case we can find is actually once again might have Pi on Louisiana but know some stuff about Louisiana because we've been doing some research a few years ago there was a lot of criticism on public private partners uh and many of them were awarded by preference and privilege and all sorts of

things like that and didn't produce good results the legislature and Louisiana's solution to that was actually to change the Constitution uh so that the contractural documents in public private Partnerships would always be confidential and there' be no public access to them that's what we would call a regressive act um the legislature in Pennsylvania decided on one occasion that that they weren't getting paid enough so they increased their own pay outside um the constraints of the law and when they found that that was unlawful and we're told so what they decided to do was to pay

it to themselves as non-accountable um and non- taxable expenses um that created a lot of problems so these are some of the things that would make a difference uh and I think that they're doable are you going to make a lot of progress on them I think progress has made steps out of time and if we look back over the last 5 years when I show showed you the big text we've got some big steps in place that have made the federal government much more transparent and I think that's good um but I'd like to

think that you people as you work with your members continue to think about um I wouldn't like to campaign on the basis of I'm in favor of Greater SE per I don't think it's a winning concept uh but I I would like to campaign on the basis of I'd help to make the government more open transparent and accountable thank you everybody and I'm happy to take some questions right we'll now be able to take some questions take a us a and yesac some of the obstacles most of the obstacles are individuals who are reluctant to

change uh so in the legislature you have uh resistance you also have resistance from bureaucracies uh who have uh um developed a comfort zone around the confidentiality of the things that they do they don't want to have to account for results they don't mind the county for spending money uh but they don't want to account for results so there's some uh natural barriers in there um but outside of the legislature U the public concept is that open and transparent is good en closed and secret of its B so they give some big Le leverage on

the side may change anybody else I would say 1% of them ever there uh so my question is I mean how you may have all of those annual reports from M whoever but as you can see there four people here in this room who and it really doesn't toity because designed for professional readers it's not designed for you know okay so probably there should be some other and people know going right not because didn't publish right report or wrong report they know it because they just you know there's repress ways for public government it's not

straight okay the question really is U there are many situations in which information is available people don't Avail themselves of that information uh and the answer to that question is that that's not important what's really important is that the information is available and when you want it you can here you see if Walmart were to short cir some of the information it would only take one or two analysts to identify that there would be a reaction on Wall Street Walmart shares would be down and there would be controversy all over the media that's the thing

that's important the fact that it has to be um public disciplines the behavior because I don't know who it is that's going to pick up my questionable Behavior so whether or not people use it is not Material the fact that it has to be done is what exercises the most discipline on behavior of individuals I'm saying that it doesn't have to be written you know you said that one of the criteria is how understandable it is for regular V but you know any report of a big company is simply not understandable even for very well

trained F you know well if you if you pick up a a corporate um say a one of the top 500 corporations in the United States and you read their annual report a for a stab is not very big what it does do is give you a nice picture of what happened in the company during the year um but what really happens is that the analysts look behind that because you can access the other information uh and they look behind that and they decide whether or not that's a fair representation of what happened in that

organization so uh if I'm a shareholder I can pick that up and I can get an idea of um what they've done where they're going and whether I like the idea of that if I wanted something in Greater depth then I go read this Stu from the analysts or it would appear on the news uh that says that um maybe there's some questions that should be asked about that and it's only in those cases where that remains Secret uh which was the case with Enron with Enron you had a situation where the rules based approach

said that you can shift your debt into these separate entities uh and you don't have to declare um the ethics based approach says that that was acceptable for the very small number of cases where it was appropriate uh to use that facility it is not acceptable as a means of disguising your indebtedness which is what the board and the management of Enron did they used that as a device to disguise their indors if the market had known anything about how much They Carried uh of debt and those special in these and the share price of

Inon would have gone down a long time before that which probably would have stopped the practice um so you know the sometimes rules in in the way of the result that you want and uh the relying on people's ethical Behavior but having the opportunity to judge whether they have acted ethically produces normally better results not in every case the other part of your comment your question is you know Iraq this doesn't really deal with the issues of where bad policy decisions have been made because they will be made from time to time uh and if

it's a bad policy decision that it really needs to be addressed in terms of of that policy whether it's a government or whether it's a a corporation a private institution uh it's exactly the same if um if General M motters makes a bad policy decision then it's a bad policy decision and either they have to wear the consequences or they have to change it governments have to do exactly the same um transparency helps that um when you get into the issues of National Security then that's mask a little bit by what's the best interest of

the country and how much of this can we actually put out there uh to public review and uh therefore we the public deal with a lot of that on the basis of of trust and trust that the organizations like the CIA and the FBI and all of the other alphabet agencies are doing a good job and sometimes they would and um so consequently theice might have been good uh or sometimes people didn't act on their advice we don't get to know that that's a um a downside that we can't really deal with um we've just

got to trust people and then when we find that they weren't worthy of the trust We Day accordingly anybody else okay thank you everybody for coming