The GOVERNANCE blog

Edwin Truman responds to Don Kettl’s commentary, The Merit Principle in Crisis: Don Kettl’s commentary makes a good case but omits two tough issues.  The first is the issue of Schedule C appointments and how they have affected the application of the merit principle. Paul Volcker headed a commission on this topic 25 years ago, and I can attest that it is much, much worse now with every passing administration. I speak only from the vantage point of Treasury experience but I can say that it is much deeper today than even when I arrived (from the Federal Reserve) in 1998 and it was pretty bad then – layers and layers of these folk who often know nothing, and tend squeeze out people who do know something from briefings and meetings. The result affects the non-monetary compensation for working in a career position. Consequently, less qualified and motivated people are attracted into the system. (It has affected the Federal Reserve Board as well, but only a bit so far.)  Second is the issue of contractors. I know there is supposed to be an efficiency gain in the use of the private sector but, in effect, the goods and services produced are outside of the merit system. I do not know how much of the government’s business (measured say in the GDP accounts) is conducted by the private sector. My impression is more and more.

Edwin M. Truman is a Non-Resident Senior Fellow at the Peterson Institute for International Economics in Washington, DC.