Statecraft Podcast Summary: "What to Expect From DOGE"
Published on January 8, 2025
Hosts:
- Santi Ruiz, Senior Editor and Author at Statecraft, Institute for Progress
- Oren Cass, Chief Economist at American Compass
Introduction
In this special episode of Statecraft, Santi Ruiz engages in an insightful conversation with Oren Cass from the American Compass podcast. The discussion centers around the Department of Government Efficiency (DOGE), exploring how top appointees and civil servants can achieve policy goals related to government efficiency, hiring practices, and state capacity.
Key Focus Areas for Government Efficiency
1. Hiring and Firing Practices
Santi Ruiz emphasizes the complexity of reforming federal hiring and firing processes. The federal government faces challenges in reducing headcount due to stringent procedural barriers and powerful public sector unions. Ruiz highlights the case of Jack Cable, a talented 17-year-old who was unjustly rejected for a Pentagon job due to outdated HR practices.
"The federal government fires four times fewer, four times less per capita than the private sector does for a variety of procedural reasons."
— Santi Ruiz [03:44]
Ruiz argues that merely reducing headcount without addressing the underlying hiring and firing mechanisms is insufficient. Instead, there is a need to streamline these processes to attract and retain high-quality talent.
2. State Capacity and Long-Term Efficiency
The conversation shifts to the broader concept of state capacity, where Ruiz discusses the importance of creating sustainable systems that can maintain efficiency over time rather than making temporary cuts.
"If you want to make the thing work better long term, you need to be able to do that consistently."
— Santi Ruiz [06:24]
Increasing salaries for technical roles is proposed as a strategy to bridge the gap between federal and private sector pay, thereby attracting better talent.
3. Balancing Efficiency and Savings
Oren Cass raises concerns about the primary motivations behind government efficiency reforms—whether they aim for operational excellence or cost savings. He points out that while saving money is beneficial, the impact on the federal deficit is minimal compared to other expenditures like defense and welfare.
"If you can reduce headcount quite a bit and then you can distribute the savings, maybe that's one of the ways that stuff actually gets into legislation."
— Santi Ruiz [13:02]
Ruiz concurs, noting that while some savings are achievable, the larger goal should be enhancing state capacity rather than just cutting costs.
Regulatory Rescissions and Political Challenges
1. DOGE's Agenda and Legislative Power
The discussion delves into DOGE's objectives, which include cutting regulation, reducing taxpayer costs, and improving government efficiency. However, Ruiz expresses skepticism about the feasibility of achieving significant deficit reductions solely through these measures.
"I would not be surprised if... the recommendations are just completely politically dead on arrival."
— Santi Ruiz [24:33]
Cass probes the political economy, questioning why, despite substantial political momentum, large-scale reforms have historically failed. Ruiz explains that while some bipartisan support exists for cutting Pentagon waste, more aggressive measures like headcount reduction face significant resistance.
2. Messaging and Public Perception
Ruiz highlights a paradox where the most straightforward cost-cutting measures are those that garner public support but may not contribute meaningfully to state capacity. Conversely, substantial reforms that enhance government effectiveness are harder to sell to the public.
"The parts that are easiest to message are the least meaningful fixes."
— Santi Ruiz [19:46]
Building State Capacity Through Investment
1. Importance of Research and Development (R&D)
Transitioning from austerity, Ruiz underscores the critical role of R&D in driving productivity growth. He warns against short-sighted penny-pinching that undermines long-term innovation.
"R and D comes out as one of the top one or two that we have."
— Santi Ruiz [25:54]
2. Leveraging Advanced Market Commitments and Other Tools
Ruiz advocates for utilizing existing federal tools like Advanced Market Commitments (AMCs) and Other Transactions Authority (OTA) to foster public-private partnerships without the cumbersome traditional procurement processes.
"Operation Warp Speed is an example of... advanced market commitments,"
— Santi Ruiz [31:23]
Cass relates this to Elon Musk’s ventures, noting the indispensable role of government in supporting technological advancements through funding and market participation.
Financing and Contracting Practices
1. Challenges in Defense Contracting
Understanding the complexities of federal contracting, Ruiz points out that inconsistent large purchases can hinder the development of robust manufacturing and defense sectors.
"DoD currently does, you know, sporadic large purchases and it's very hard to build a manufacturing and defense sector off the back of those."
— Santi Ruiz [34:14]
2. Potential for Improvement
Both hosts agree that refining contracting practices is essential for fostering innovation and sustaining industrial growth, with upcoming episodes promising deeper dives into these topics.
Evaluating Success and Future Outlook
1. Setting Ambitious Goals
Ruiz advocates for clear, ambitious targets to hold agencies accountable, using NASA’s moon landing as an example of successful goal-setting driven by presidential mandates.
"We are giving you cover, we want you to use it."
— Santi Ruiz [34:53]
2. Political Momentum and Feasibility
With DOGE’s established political mandate and backing from President Trump, Ruiz remains cautiously optimistic about the potential for meaningful legislative and procedural changes.
"It's not a fool's errand."
— Santi Ruiz [20:54]
Conclusion
Santi Ruiz and Oren Cass conclude the episode by acknowledging the significant challenges ahead for DOGE in implementing effective government efficiency reforms. They express hope that with clear goals, political support, and innovative use of existing federal tools, substantial improvements in state capacity and government performance are achievable.
"Well, Santa Ruiz, thank you so much for taking the time to join us."
— Oren Cass [36:18]
"Oren, it's been a pleasure. Thank you."
— Santi Ruiz [36:28]
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