The National Performance Review and Other Government Reform Initiatives: An Overview, 1993-2001
CRS Report for Congress
The National Performance Review
and Other Government Reform Initiatives:
An Overview, 1993-2001
Updated June 4, 2001
Harold C. Relyea
Specialist in American National Government
Maricele J. Cornejo Riemann and Henry B. Hogue
Analysts in American National Government
Government and Finance Division
Congressional Research Service The Library of Congress
The National Performance Review
and Other Government Reform Initiatives:
An Overview, 1993-2001
Summary
Shortly after his inauguration in 1993, President William Clinton announced he
was initiating a National Performance Review (NPR) to be conducted over the next
six months by a task force headed by Vice President Albert Gore, Jr. In September
1993, this task force delivered a report to the President, offering some 380 major
recommendations concerning management reform, reorganization, and government
downsizing. Implementation of these recommendations was to be accomplished
through presidential directives, congressional action, and individual agency initiatives.
A year later, in September 1994, the NPR issued a status report indicating that
90% of its initial recommendations were being implemented; $46.9 billion of its $108
billion in projected savings had been enacted; an additional $16 billion in savings was
pending before Congress; and federal employment had dropped by 71,000 positions.
Shortly after the release of this report, the November 1994 congressional elections
gave the Republicans majority party control of the House and the Senate for the 104th
Congress. Republican leaders had unveiled a Contract with America reform plan in
late September 1994. Its core principles regarded the federal government as being
too big, too expensive, unresponsive to the citizenry, and the perpetrator of
burdensome regulations. Consequently, two distinct agendas for reforming and
restructuring the federal government were before the 104th Congress. At its
conclusion, both the President and Republican congressional leaders could claim some
victories in downsizing government. No department was eliminated, however, and
only a few small agencies were abolished.
Additional NPR status reports, recommendations, and proposals followed in
1996, 1997, and 1998. Republican congressional majorities continued during the
105th and 106th Congresses. Administration and congressional reinvention and reform
efforts resulted in moderate accomplishments during the 105th Congress. Significant
exceptions were the overhaul of the structure and operations of the Internal Revenue
Service and the consolidation of the foreign policy agencies, both of which were
realized as a result of cooperation between the Clinton Administration and Republican
congressional leaders. With the convening of the 106th Congress, it appeared that the
momentum for pursuing major government reinvention and reform had considerably
slowed. The NPR ceased operations with the conclusion of the Clinton
Administration on January 19, 2001.
This report reviews the record of the National Performance Review and its 1998
successor, the National Partnership for Reinventing Government. It chronicles, as
well, related and sometimes competing government reform efforts, and assesses the
overall record of the NPR. The report will no longer be updated.
Contents
The National Performance Review: Phase I............................2
The NPR Report............................................4
Implementing the NPR Recommendations.........................5
NPR and the 104th Congress: Phase II................................7
The First NPR Status Report...................................8
The New Republican Congress................................11
NPR Enters Phase II........................................12
The Budget Impasse........................................15
First-Term NPR............................................16
NPR Renewed: Phase III.........................................17
Reinventing the Reinvention Effort.............................17
Performance-Based Organizations..............................21
The Report Cards and Beyond.................................24
Successes, Problems, and Remaining Questions........................26
Successes ................................................. 26
Problems ................................................. 30
Remaining Questions........................................32
Closure .................................................. 35
The National Performance Review
and Other Government Reform Initiatives:
An Overview, 1993-2001
During the 20th century, major attempts have been made from time to time to
improve the operation of the federal government—largely the program activities of
the executive departments and agencies—through management reforms,
reorganization, and downsizing.1 One of the more recent efforts was spearheaded by
the Executive Committee of the President’s Private Sector Survey on Cost Control
of the Federal Government, established by President Ronald Reagan with E.O. 12369
of June 30, 1982. Chaired by industrialist J. Peter Grace, the panel, which became
popularly known as the Grace Commission, was composed of 161 corporate
executives and was, according to the chartering order, to “advise the President and
the Secretary of Commerce, and other Executive agency heads with respect to
improving management and reducing costs.”2 Utilizing 36 task forces and the
assistance of some 2,000 business executives, managers, experts, and special
consultants, the Grace Commission, in January 1984, issued a 47-volume report, with
a two-volume summary, which offered 2,478 recommendations.3 A month later, a
General Accounting Office (GAO) and Congressional Budget Office (CBO) joint
assessment of a sample of these recommendations resulted in the following GAO
conclusions:
Specifically, of the 396 recommendations assessed, GAO identified 242 as having
some merit, 83 as not having merit, and 71 for which GAO had no basis for an
opinion. Of the 242 recommendations GAO believed had merit, it had previously
made similar or related recommendations in 150 cases. It is important to note,
however, that many of the recommendations that do not have merit in GAO’s
opinion were among those with large savings estimates in the [Grace Commission]
reports. It is also important to note that GAO does not agree that all of the
proposals for which CBO estimated budgetary savings are feasible or desirable.
1Generally, see Peri E. Arnold, Making the Managerial Presidency, 2nd edition (Lawrence, KS:
University Press of Kansas, 1998); Herbert Emmerich, Federal Organization and
Administrative Management (Tuscaloosa, AL: University of Alabama Press, 1971); Paul C.
Light, The Tides of Reform (New Haven, CT: Yale University Press,1997); U.S. Library of
Congress, Congressional Research Service, Reorganizing the Executive Branch in the
Twentieth Century: Landmark Commissions, by Ronald C. Moe, CRS Report 92-293 GOV
(Washington: Mar. 19, 1992).
2See 3 C.F.R., 1982 Comp., pp. 190-192.
3The Grace Commission’s final summary report was commercially published as President’s
Private Sector Survey on Cost Controls, War on Waste (New York: Macmillan, 1984).
Conversely, GAO believes that many proposals for which CBO was not able to4
estimate budgetary savings have merit and deserve further consideration.
While controversy has continued to attend estimates of savings accruing from
the implementation of Grace Commission proposals, the Office of Management and
Budget (OMB) indicated that 83% of “the unduplicated Grace Commission
recommendations have been accepted by the President and reflected in the 1990 or
prior budgets.”5
Among the themes that Arkansas Governor William Clinton brought to the
presidency a few years later was the pledge “to radically change the way government
operates—to shift from top-down bureaucracy to entrepreneurial government that
empowers citizens and communities to change our country from the bottom up.”6
Some of his proposals in this regard,7 such as regulating post-employment lobbying
activities by senior administration appointees,8 reducing administrative expenses,9
eliminating 100,000 federal employee positions,10 and cutting Executive Office of the
President staff by 25%,11 were partly or fully implemented shortly after his January
The National Performance Review: Phase I
A more ambitious and far-reaching effort at changing government operations
was announced by President Clinton on March 3, 1993. He indicated he was initiating
a National Performance Review (NPR) to be conducted over the next six months by
a task force headed by Vice President Albert Gore, Jr. “Our goal,” said the President,
“is to make the entire Federal Government both less expensive and more efficient, and
to change the culture of our national bureaucracy away from complacency and
4U.S. Congressional Budget Office and U.S. General Accounting Office, Analysis of the
Grace Commission’s Major Proposals for Cost Control (Washington: GPO, 1984), p. 2.
5U.S. Office of Management and Budget, Management of the United States Government:
Fiscal Year 1990 (Washington: GPO, 1989), p. 5-2.
6Bill Clinton and Al Gore, Putting People First: How We Can All Change America (New
York: Times Books, 1992), p. 24.
7See ibid., pp. 25-26.
8See E.O. 12834, in Federal Register, vol. 58, Jan. 22, 1993, pp. 5911-5916.
9See E.O. 12837, in ibid., Feb. 12, 1993, pp. 8205-8206.
10See E.O. 12839, in ibid., p. 8515.
11Ann Devroy, “Clinton Announces Cut in White House Staff,” Washington Post, Feb. 10,
1993, pp. A1, A7; Thomas L. Friedman, “Clinton Trimming Lower-Level Aides,” New York
Times, Feb. 10, 1993, pp. A1, A20. Also see U.S. Library of Congress, Congressional
Research Service, President Clinton’s Proposed Reduction in White House Staff, by Rogelio
Garcia, CRS Report 93-476 GOV (Washington: May 6, 1993).
entitlement toward initiative and empowerment. We intend to redesign, to reinvent,
to reinvigorate the entire National Government.”12
Based upon a similar 1991-1992 assessment in the State of Texas, the NPR was
to be assisted by senior department and agency managers, auditors, and front-line
workers; OMB management analysts; advice from federal employees, citizens, and
private sector leaders; and congressional proposals for eliminating waste in
government. The effort was to evaluate the efficiency of every federal program and
service; identify specific spending cuts that could be made in federal programs and
services not operating effectively and no longer advancing the mission they were
intended to serve; recommend ways to streamline the bureaucracy by eliminating
unnecessary layers of management and reducing duplication of effort; and find ways
to improve services by making better use of new information technology and by
making government programs more responsive to the clientele they serve. In brief,
the objective of the NPR was to “reinvent government”—a phrase taken from the13
popular 1992 book Reinventing Government.
By early April, the NPR was organized with 11 “system reinvention” teams and
results-oriented budgeting; transforming organizational structures; reinventing
personnel management; reengineering through information technology; improving
financial management; eliminating internal barriers; improving regulatory systems;
empowering state and local governments; rethinking program design; redesigning
management systems; and minimizing federal damage to the environment.
Agency-by-agency redesign teams were constituted for each of the 14 Cabinet-
level departments and seven specific independent agencies,14 plus one for all other
executive entities. OMB was covered by the budgeting and management systems
reinvention teams; the Office of Personnel Management (OPM) was examined by the
personnel management reinvention team; and the General Services Administration was
scrutinized by the internal barriers reinvention team.
The work of the NPR was formally inaugurated on April 15, 1993, with an
assembly that was addressed by Vice President Gore; David Osborne, coauthor of
Reinventing Government; and Robert Stone, Defense Department deputy assistant
secretary for installations and project director for the NPR. As scheduled, NPR
personnel, most of whom were agency detailees, gathered information during April
and May, and analysis commenced the following month. Recommendations were
formulated in July, and drafts of findings and recommendations were circulated to
Cabinet members for comment in August.
12Weekly Compilation of Presidential Documents, vol. 29, Mar. 8, 1993, p. 350.
13David Osborne and Ted Gaebler, Reinventing Government (Reading, MA: Addison-Wesley,
14These seven agencies were the Environmental Protection Agency, National Aeronautics and
Space Administration, National Science Foundation, Nuclear Regulatory Commission,
Agency for International Development, Federal Emergency Management Agency, and Small
Business Administration.
The NPR Report
The initial NPR report, From Red Tape to Results: Creating a Government That
Works Better & Costs Less, was delivered to the President on September 7, 1993.15
Various accompanying supplemental reports on both specific agencies and functional
areas of government were subsequently published during 1994. All of these
documents and later NPR materials are available through the NPR website, which is
now in archival status ([http://govinfo.library.unt.edu/npr/default.html]).
Offering over 380 major recommendations by agency and by affected
governmental systems, the initial report also provided a summary of anticipated
savings deriving from these recommendations. Unlike several previous presidential
study panels on government reform, the NPR did not emphasize executive
reorganization in its recommendations, though it did propose that Congress should
restore the President’s authority to restructure the executive branch through
reorganization plans and did suggest over a dozen specific reorganizations.16 Most
of the NPR recommendations sought to streamline government operations, to
improve management, and to promote efficiency and economy in administration—all
with a view to better service delivery and customer satisfaction. The Grace
Commission had some similar recommendations, but made its offerings to combat
waste, fraud, and abuse in government.
The mission and initial report of the NPR prompted some critical reaction from
the scholarly community concerning the application of some private sector criteria to
essentially different public sector enterprises. One public administration scholar
objected to the NPR endowing entrepreneurial government with “empowered
customers,” competition, markets, reduced regulations, charging fees and making
money, decentralization, and privatization. He cautioned that “promises of better
government for less money are simplistic and misleading, regardless of the ‘principles’
upon which they are based”; “governments are not markets”; “citizens are not
customers ... they are the owners”; “it is incorrect to assume that either those who
work for government or the system of government work are the primary problems”;
and “downsizing, rightsizing, cutback management and the other means of reducing
15See Office of the Vice President, From Red Tape to Results: Creating a Government That
Works Better & Costs Less. Report of the National Performance Review (Washington: Sept.
16The President’s authority to prepare reorganization plans and submit them for congressional
approval was initially established temporarily in 1939, and was then renewed periodically a
dozen times between 1945 and 1984, with slightly varying procedural and plan content
conditions. Modification of this authority was made necessary in 1983 when the Supreme
Court, in the Chadha case (462 U.S. 919), effectively invalidated continued congressional
reliance upon the mechanism of a concurrent resolution to disapprove a proposed
reorganization plan. Under the Reorganization Act Amendments of 1984, signed by President
Reagan on Nov. 8, 1984, several significant changes were made in the reorganization plan law
(5 U.S.C. 901-912 (1988)). These amendments, however, continued the President’s
reorganization plan authority only to the end of the year, when it automatically expired.
President Reagan did not request its reauthorization, nor did President George Bush or
President Clinton.
the size and costs of government, when combined with deregulation, have
significantly diminished the capacities of some units of government to function
effectively.”17
A former Bureau of the Budget specialist in government organization and
management observed that contracting government services for private sector
performance was not “necessarily cheaper, more efficient and more flexible,” and
warned:
Contracting out does not de facto reduce the size of government, promote
efficiency, reduce costs or limit the scope of government responsibility. Nor does
it eliminate the need for public management; it only changes its character.
Because so much of government is contracted out, we urgently need innovation and
the development of new approaches to public management. Thus far, we have
tended to view the government’s role as limited to that of a contract writer and18
negotiator, auditor and bill payer.
Implementing the NPR Recommendations
To pursue its many recommendations, the NPR proposed the creation of a
President’s Management Council to “ensure that quality management principles are
adopted, processes are reengineered, performance is assessed, and other National
Performance Review recommendations are implemented.”19 Subsequently established
by a presidential memorandum of October 1, 1993, the council was composed of the
chief operating officers of 15 major departments and agencies, representatives of the
Administrator of General Services and the director of OPM, and the President’s
secretary of the Cabinet, with the OMB deputy director for management as the
chair.20
Shortly after receiving the initial NPR report, President Clinton began
implementing its recommendations. For example, with a memorandum of September
9, 1993, he created the Community Enterprise Board, with the Vice President as
chair and 17 other top officials as members, to assist with the implementation of
legislation mandating the establishment of empowerment zones, enterprise
communities, and rural development investment areas.21
NPR recommendations also received attention in the Treasury, Postal Service,
and General Government Appropriations Act, 1994, which removed full time
employee equivalent floors for some federal agencies funded by the legislation,
17H. George Frederickson, “Painting Bull’s-Eyes Around Bullet Holes,” Governing, vol. 6,
October 1992, p. 13.
18Harold Seidman, “Reinventing the Wheel, Not Government,” Government Executive, vol.
19Office of the Vice President, From Red Tape to Results: Creating a Government That Works
Better & Costs Less, p. 89.
203 C.F.R., 1993 Comp., pp. 788-791.
21See Weekly Compilation of Presidential Documents, vol. 29, Sept. 13, 1993, pp. 1716-1718.
directed the Internal Revenue Service and U.S. Customs Service to submit plans for
restructuring each agency to the Committees on Appropriations, and allowed agencies
funded by the legislation to carry over 50% of such unobligated funds for an22
additional year, with the other half reverting to the Treasury.
The NPR reform effort received added momentum with the October 7, 1993,
announcement of the formation of a bipartisan reinventing government study group
of House freshmen cochaired by Representatives Jane Harman (D-CA) and Ken
Calvert (R-CA). Calling the NPR report “an important first step in laying out specific
proposals for reducing government waste and cutting red tape,” organizers of the
group called upon the Speaker and other House leaders to schedule votes on NPRrd23
proposals during the remaining months of the 103 Congress. President Clinton
provided the opportunity for a major vote in this regard when, on October 26, 1993,
he transmitted to Congress a proposal implementing a number of NPR
recommendations, including reorganization of the Department of Agriculture and U.S.
Army Corps of Engineers, streamlining of the Department of Housing and Urban
Development, and termination of the Alaska Power Administration, the Uniformed
Services University of the Health Sciences, and various individual programs. On
October 28, the measure was introduced as the Government Reform and Savings Act
of 1993 (H.R. 3400), and portions were referred to 17 committees for a period ending
not later than November 15, 1993. Ten of these panels reported and the others were
discharged from further consideration of the bill on November 15. The House
Committee on Rules held a November 19 hearing on the bill and reported a modified24
version of it the following day. Floor discussion commenced on November 22, and
the House subsequently approved H.R. 3400, as amended, on a 429-1 recorded
vote.25 The bill was referred to the Senate, and the first session of the 103rd Congress
concluded on November 26.
With the beginning of the second session of the 103rd Congress in late January
1994, some Senate committees began examining portions of H.R. 3400, but the bill
was formally referred only to the Committee on Governmental Affairs. A hearing was
held by that committee on February 23 to consider those sections of H.R. 3400 within
its jurisdiction. Testimony was received from Comptroller General Charles Bowsher
and OMB Deputy Director Alice Rivlin. On March 23, the committee voted to report
a new bill (S. 2170) addressing only four of the 17 titles of H.R. 3400. The
committee’s report accompanying the new bill commented that, “Senate action on the
entire H.R. 3400 will most certainly depend on the action taken by other committees
with regard to those provisions within their jurisdiction.”26 However, no other Senate
22See 107 Stat. 1226.
23Office of Representative Ken Calvert, “Calvert Calls for Votes This Session on Reinvention
Proposals,” press release, Oct. 7, 1993; Karen Foerstel, “Frosh Join Call for Vote This
Session on Gore Plan,” Roll Call, Oct. 7, 1993, pp. 3, 18.
24U.S. Congress, House Committee on Rules, Providing for Consideration of H.R. 3400, 103rd
Cong., 1st sess., H.Rept. 103-403 (Washington: GPO, 1993).
25See Congressional Record, vol. 139, Nov. 22, 1993, pp. 31990-31991.
26U.S. Congress, Senate Committee on Governmental Affairs, Government Management
(continued...)
committee moved any of the other titles of H.R. 3400 for Senate floor consideration
during the second session. The Senate eventually considered and passed S. 2170 in
late September and the House gave its approval to the bill in early October, clearing
the measure for the President’s signature on October 13, the result being a modest
implementation of NPR recommendations.27
That same day, President Clinton also approved two other bills implementing
NPR recommendations. Reform of government procurement arrangements was
accomplished with the Federal Acquisition Streamlining Act.28 Presidential directives
facilitating the implementation of the new law were coincidently issued when it was
signed.29 The other approved legislation, originally a federal crop insurance reform30
bill, had been amended to reorganize the Department of Agriculture.
Several months earlier, on March 30, 1994, President Clinton had signed another
measure, the Federal Workforce Restructuring Act, implementing an NPR31
recommendation. It authorized the departments and agencies to begin a downsizing
of their personnel through early retirement buyouts. Another law, the Government
Performance and Results Act, given presidential approval on August 3, 1993, was
recommended in the initial NPR report and the legislation had been endorsed byrd32
President Clinton when it was introduced in the 103 Congress. The proposal,
however, predated the NPR and had been largely developed by Senator William V.
Roth, Jr. (R-DE).
NPR and the 104th Congress: Phase II
With the issuance of its first status report and the Republican takeover of the
House in the fall of 1994, NPR transitioned into a second phase of goals and activity.
This change in goals put the reinventing effort on a parallel track with the reform
efforts advocated in the Contract with America, which formed the cornerstone of the
agenda of the new Republican majority in Congress. Reform advocates in both
branches focused on defining the appropriate scope of government functions, rather
than how government should function, which had been the question undergirding
Phase I of the NPR. The NPR claimed that Phase I, in the executive branch, had been
very successful, and laid out the agenda for a second phase with new
recommendations for saving money, modifying or ending programs, and privatizing
26(...continued)
Reform Act of 1994, report to accompany S. 2170, 103rd Cong., 2nd sess., S.Rept. 103-
27108 Stat. 3410.
28108 Stat. 3243.
29See E.O. 12931 and a related presidential memorandum of Oct. 13, 1994, in 3 C.F.R., 1994
Comp., pp. 925-926, 1040.
30108 Stat. 3178.
31108 Stat. 111.
32107 Stat. 285.
some government functions. The House Republican leadership, under Speaker Newt
Gingrich, pushed for passage of Contract legislation, including bills to reduce the size
and scope of government. Although both branches focused attention on the proper
role and scope of the federal government, their agendas were very different. These
differences contributed to an impasse in budget negotiations that led to a temporary
shutdown of the federal government in the fall and winter of 1995-1996.33 In the
wake of this conflict, the NPR shifted focus to highlight its role in reducing the deficit
and moving toward a balanced budget as Congress and the Clinton Administration
faced the 1996 elections.
The First NPR Status Report
In September 1994, Vice President Gore released the first NPR status report,
which reviewed the progress that had been made in implementing the 1993
recommendations. Among the claims offered for realizing a government that “works
better & costs less” were the following.
!Over 90 percent of National Performance Review recommendations are underway.
!The President has signed 22 directives, as well as performance agreements with seven
agency heads.
!Over 100 agencies are publishing customer service standards.
!Nine agencies have started major streamlining initiatives.
!Agencies are forming labor-management partnerships with their unions.
!Agencies are slashing red tape.
!The Government is buying fewer “designer” products and doing more common-sense
commercial buying.
!135 “reinvention laboratories” throughout the federal government are fostering
innovation.
!The government is shifting billions of dollars in benefits to electronic payment.
!The federal government is changing the way it interacts with state and local34
governments.
According to the report, government costs were cut as well.
33See U.S. Library of Congress, Congressional Research Service, Shutdown of the Federal
Government: Causes, Effects, and Process, by Sharon S. Gressle, CRS Report 98-844 GOV
(Washington: Jan. 18, 2001).
34Office of the Vice President, Creating a Government That Works Better & Costs Less:
Status Report. Report of the National Performance Review (Washington: September 1994),
p. 5.
!$46.9 billion of NPR’s $108 billion in proposed savings are already enacted.
!$16 billion in savings is pending before Congress.
!Federal employment has dropped 71,000 positions.
!$695 million in savings results from ending federal subsidies for wool and mohair.
!The Defense Department’s overhaul of its travel process will save $1 billion over five
years.
!The Federal Communications Commission’s auctions of new radio frequencies are
raising millions.
!Government’s use of a Visa card for small purchases is saving $50 million this year.35
The report noted that the executive and legislative branches had cooperated in
passing legislation to achieve these results.
!Congress has enacted 21 NPR-related laws, including the first-ever governmentwide
“buyout” authority, and mandated cuts in the federal workforce.
!Congress has provided increased flexibility for a variety of programs involving state
and local government.
!Congress is about to enact the most significant procurement reform in a decade.
!47 NPR-related actions passed both houses.
!Another 46 passed one house.
!Congress held more than 80 hearings on various NPR recommendations.36
A Brookings Institution report issued at this time also regarded the NPR as
having made progress during its first year, with some cautionary caveats. The
assessment praised the reform effort's work toward cultural change in the bureaucracy
and its success in simplifying some rules and processes, particularly with regard to
personnel and procurement, improved coordination of government management
through the President's Management Council (PMC), and "widespread innovation by
federal managers."37 At the same time, the report expressed concerns about the
sustainability of the NPR reform effort due to four critical problems. First, the NPR
sought to change organizational culture at the same time that it was implicitly
condemning government employees by criticizing government performance, cutting
positions, and challenging entrenched processes. It judged that this two-prong effort
35Ibid., p. 7.
36Ibid., p. 6.
37Donald F. Kettl, Reinventing Government? Appraising the National Performance Review,
CPM Report 94-2 (Washington: Brookings Institution, 1994), p. 2.
was likely to alienate employees, especially those who had weathered previous
unsuccessful reforms. Second, the report was concerned that the methods of
workforce reduction and other changes overlooked the importance of government
capacity. The report's author, Donald Kettl, wrote of the risk of "an even more
hollow government with far less capacity to do its job and managed by employees
with even less incentive to do their jobs well."38 Third, the report expressed concern
about the lack of clarity in the core NPR ideas; the principles and purposes behind the
reform needed to be more clearly defined or risk losing focus or creating conflicting
agendas. Fourth, the reform effort's plan to decentralize government and empower
employees to be more entrepreneurial risked damage to accountability, particularly
to Congress.
Some in academic circles went beyond the Brookings report in arguing that the
entrepreneurial focus of the NPR was in tension with the President's constitutional
duty to "take Care that the Laws be faithfully executed."39 According to these critics,
public law creates a system of accountability by the bureaucracy to the President and
Congress that is eroded when government functions are decentralized and privatized
in the process of establishing entrepreneurial incentives.
The General Accounting Office (GAO) also evaluated the success of the
implementation of NPR recommendations on their own terms, assessing progress on
each of the 384 major proposals from the September 1993 report as well as the
reform effort as a whole. GAO found that about 40% of the recommendations had
been fully or partly implemented, noting that the recommendations varied widely in
their specificity and scope. It applauded most of the recommendations and
achievements of the NPR, but also expressed concern about its failure to address
critical management issues that GAO had previously identified. As GAO
representatives later testified before the House Subcommittee on Government
Management, Information, and Technology in May 1995:
[The NPR] did not address a number of issues that the Office of Management and
Budget and we consider to be high-risk areas. These issues include defense
inventory management practices that have resulted in unneeded inventory valued
by the Department of Defense at $36 billion and problems plaguing federal
information technology initiatives, such as the Federal Aviation Administration's
air traffic control modernization project. The NPR recommendations also did not
address nearly three-fourths of the issues we identified last year for the former
chairman of this Committee as the most important management problems facing
23 federal agencies. These issues include the lack of effective controls over
Department of Defense disbursements and inadequate project management and
planning in the Department of Energy. Therefore, while we believe the
recommendations NPR made are an important contribution toward improved
federal management, we also believe that significant additional opportunities40
remain to make government work better and cost less.
38Ibid., p. 3.
39U.S. Constitution, Article II, section 3.
40U.S. General Accounting Office, Government Reform: GAO's Comments on the National
(continued...)
Perhaps more significant than the measurement of progress was the GAO call for
closer work between Congress and the executive branch on the reforms, greater
attention to development and maintenance of agencies' capacities in reform efforts,
and more sustained attention to reform by political and career leaders. GAO also
urged reformers to refocus evaluation efforts away from "inputs, outputs, and
processes to an emphasis on outcomes and results – consistent with the Government
Performance and Results Act of 1993."41 In addition, GAO suggested that the NPR
would need a more cohesive statement of its management principles:
NPR performed a service in highlighting many problems that needed to be
addressed and recommending solutions to these problems. However, to be
successful in the long run, NPR will need to sharpen its focus and bind the
recommendations together into a more coherent framework that can better permit
the government reform movement to take root and flourish.42
The New Republican Congress
Shortly after the NPR’s 1994 status report was released, the Republicans won
majority control of the House and Senate in mid-term elections, and the focus of the
congressional agenda with regard to public administration turned to reducing the size
and scope of the federal government. The agenda was based on the Republican's
Contract with America, which called for "the end of government that is too big, too
intrusive, and too easy with the public's money." The new Republican majorities in
the House and Senate facilitated passage of the Line Item Veto Act, which President
Clinton supported and which vested him with more control of unwanted budgetary
expenditures.43 They pressed for passage of the Unfunded Mandates Reform Act of
1995, which limits the ability of the federal government to impose unfunded mandates
on state and local governments and requires the provision of information on the costs
of federal mandates to the private sector.44 The Paperwork Reduction Act of 1995
amended the 1980 law of the same name to reduce further the paperwork burden on
the public.45 The Federal Reports Elimination and Sunset Act of 1995 modified or
eliminated many federal reporting requirements.46 The Contract with America
40(...continued)
Performance Review, GAO testimony, GAO/T-GGD-95-154 (Washington: May 2, 1995),
pp. 2-3.
41U.S. General Accounting Office, Management Reform: Implementation of the National
Performance Review's Recommendations, GAO Report GAO/OCG-95-1 (Washington: Dec.
42Ibid., p. 9.
43110 Stat. 1200; the statute was subsequently challenged in federal court and ultimately held
invalid by the Supreme Court in Clinton v. City of New York, 524 U.S. 417 (1998).
44109 Stat. 48.
45109 Stat. 163.
46109 Stat. 707.
Advancement Act of 199647 brought two other promises of the Contract into law and
also raised the public debt limit. Title I reformed Social Security disability programs,
while Title II sought to reduce the regulatory burden on small business and improve
congressional review of new regulations.
This spate of legislation reflected the difference in focus between the
congressional agenda and that of NPR's first phase. While the NPR, in its initial
report, had focused on improving government processes, notably customer service
and procurement, and on reducing the civilian workforce, the new Republican House
majority sought to limit the size and role of the federal government. As one
Republican leader was reported to have characterized the difference:
“The administration's National Performance Review continues to be an important
effort," [Representative William F.] Clinger [(R-PA), chairman of the House
Government Reform and Oversight Committee,] said. "Improving how our
government operates is both necessary and appropriate. But in addition to
improving efficiency in government, Republicans believe that we need to limit the
ever-expanding size and increasingly intrusive role of the federal government in48
our lives.”
NPR Enters Phase II
As Republican congressional leaders pursued their agenda, the NPR altered
course through a change in emphasis. Without abandoning the 1993
recommendations, the Administration's reform project widened its scope to address
the issues the victorious Republicans had raised. In the wake of the congressional
elections, President Clinton directed Vice President Gore "to conduct a second review
of agencies to identify opportunities for additional savings, program terminations, and
privatization of selected functions."49 In mid-May 1995, OMB Director Alice Rivlin
reported to the Senate Committee on Governmental Affairs that Phase II of NPR was
shifting the focus of the reform effort from how government should operate to what
it should do, saying:
The NPR and OMB set up teams to study every function and activity of
government to decide which ones the Federal Government should continue to
perform, which it should eliminate altogether, and which it should shift to the
States, localities, or private sector.50
By the time of Rivlin's testimony, related major restructuring either had been
announced or was underway in 10 agencies. Although in disagreement about the
47110 Stat. 847.
48Greg Pierce, "Hearings Eye Government Reinvention," Washington Times, May 3, 1995,
p. A7.
49Office of the Vice President, Common Sense Government Works Better & Costs Less: Third
Report of the National Performance Review (Washington: September 1995), p. 119.
50U.S. Congress, Senate Committee on Governmental Affairs, Executive Branch
Reorganization, hearing, 104th Cong., 1st sess., May 17-18, 1995, p. 113.
prescription, by the spring of 1995, both the Clinton Administration and Congress, in
their reform discussions, diagnoses, and recommendations, were focused on the
proper administrative role of government.
The Administration released its second status report, Common Sense
Government Works Better & Costs Less, in September 1995.51 It described progress
on the original set of recommendations, and also articulated the administration's new
vision for the NPR. Claiming that one third of the original recommendations had been
completed and that nearly all of the others were underway, the report also announced
more than 180 new recommendations that had arisen for Phase II. As presaged in
Rivlin's testimony, the new recommendations focused on devolving, discontinuing, or
privatizing government functions.
Despite the similarity of stated government reform goals expressed by
Republican congressional leaders and the Administration, wide differences in the scale
and location of the reductions were evident in the rhetoric and proposals of each
camp. Republican congressional leaders had a bold agenda for decreasing the size of
government through contracting out, privatizing government functions, and cutting
the number of programs and agencies. For example, Representative John L. Mica (R-
FL), chair of the Subcommittee on Civil Service, Committee on Government Reform
and Oversight, reportedly proposed contracting out half of the federal government's
activities to the private sector.52 Privatization efforts spearheaded by Representative
Scott L. Klug (R-WI) focused on the petroleum reserves, helium reserves, power53
marketing administrations (PMAs), and the Government Printing Office.
Congressional intentions for decreasing the size of the federal government were
probably best reflected in the plans of Senate Budget Committee Chairman Pete V.
Domenici (R-NM) and House Budget Committee Chairman John Kasich (R-OH),
which promised to save $806 billion and $1 trillion, respectively. Both plans called
for significant government reductions. Kasich's plan, for example, reportedly called
for the elimination of three Cabinet departments, 13 agencies, 68 boards,
commissions, and authorities, and over 230 programs.54
The savings reported and proposed by the Administration were modest by
comparison. The 1995 status report stated that around $58 billion of the originally
projected savings of $108 billion had been realized and that the remaining $50 billion55
was either pending before Congress or "to be acted on in the near future." Some
$70 billion in additional savings was projected from the Phase II recommendations.
51See citation at note 49.
52Ruth Larson, "More Contracting Sought to Cut Costs," Washington Times, Mar. 30, 1995,
p. A8.
53Nancy E. Roman, "In GOP's Privatization Drive, Roadblocks Dot Obstacle Course,"
Washington Times, June 12, 1995, p. A1.
54"How to Shrink the Federal Government," Washington Times, May 12, 1995, p. A21;
Patrice Hill, "GOP Offers Balanced Budgets: 7-year Plans Cut $1 Trillion," Washington
Times, May 10, 1995, p. A1.
55Office of the Vice President, Common Sense Government Works Better & Costs Less: Third
Report of the National Performance Review, p. 149.
Taken together, these savings were far from the target figures of the congressional
Republicans. The federal government reduction envisioned by the NPR also differed
from that of the Republicans. Whereas Republican congressional leaders wanted to
dismantle entire departments and agencies, recommendations for elimination or
revision of regulations by 28 agencies and departments with major regulatory
responsibility formed the focal point of the new phase of the NPR. The NPR report
asserted:
!Agencies are sending 16,000 pages of obsolete regulations to the scrap heap, of
!Agencies are reworking another 31,000 pages of regulations.
!Regulatory and administrative burdens on the public will be reduced by nearly $28
billion.
!Attitudes are changing; in many cases, fines will be waived for honest mistakes.
!Agencies are closing more than 2,000 field offices.56
According to one observer, Phase II of the NPR was designed to highlight
reform work that was underway in the agencies prior to 1995 and the "refocusing" of
the NPR was essentially a political response to the results of the midterm elections:
Increased activity in regulatory reform during 1995 offers a window onto the
NPR's methods. Substantive work towards reform was undertaken within the
regulatory agencies and not within the task force itself. Those agencies reviewed
regulations in the Code of Federal Regulations and reassessed and proposed
changes in their regulatory procedures. Essentially, at this stage, much of the
substantive work of reform was happening in regulatory agencies and was57
overseen by OMB.
The lack of cooperation between Congress and the executive on government
reform had been noted by GAO regarding the 103rd Congress, when the Democrats
were in the majority in both Houses of Congress. GAO reiterated this concern
regarding the 104th Congress and the Administration in testimony before the Senate
Committee on Governmental Affairs, as the following passages illustrate:
Reorganization demands an integrated approach .... Reorganization plans should
be designed to achieve specific, identifiable goals .... Once the goals are identified,
the right vehicle(s) must be chosen for accomplishing them .... Implementation is
critical to the success of any reorganization .... Oversight is needed to ensure58
effective implementation.
56Ibid., p. 3.
57Peri E. Arnold, Making the Managerial Presidency, p. 414.
58U.S. Congress, Senate Committee on Governmental Affairs, Executive Branch
(continued...)
The administration has taken the National Performance Review beyond its initial
examination of how government should operate to asking questions about what it
should be doing .... In Congress, committees in both Houses have gone even
farther, mobilizing to study and make far-reaching decisions on the role of59
government, its basic functions, and organizational structures.
[O]ne cannot underestimate the interconnectedness of government structures and
activities. Make changes here, and you will certainly affect something over there.
And just as the lack of an overall vision created many of the inefficiencies that
exist in the federal government today, reorganization efforts that ignore the broader
picture could create new, unintended consequences for the future. For this reason,
it is imperative that Congress and the administration form an effective working
relationship on restructuring initiatives and regulatory changes.60
The Administration’s vision of the role of Congress in addressing the proposed
NPR reforms was unclear in the 1995 status report. On the one hand, the report
continued to credit Congress with support, saying:
!Congress has enacted 36 NPR-related laws, including the biggest procurement
streamlining bill ever, with a second in progress.
!Congress has passed 66 of the 280 NPR items requiring legislation (24 percent).
!Nearly 70 NPR-related bills are currently pending in Congress.
!Congress has held more than 120 hearings on various NPR recommendations.61
However, on the other hand, the report criticized the Republican majority in
Congress for its concept of reducing the size of government.
[S]ome people, including many in Congress, have decided that the way to fix
government is just to eliminate as much of it as possible .... The main problem
with taking an axe to the federal government is that it won't fix what remains.
Government would be smaller, but it would still be as inflexible and
bureaucratic.62
The Budget Impasse
The gulf between the conceptions of government reform and reduction
envisioned by Republican congressional leaders and the Clinton Administration
contributed to the budget impasse and government shutdown at the beginning of
58(...continued)
Reorganization, p. 103.
59Ibid., p. 104.
60Ibid., p. 105.
61Office of the Vice President, Common Sense Government Works Better & Costs Less: Third
Report of the National Performance Review, p. 3.
62Ibid., p. 2.
FY1996.63 Congress proposed legislation that would have made deep cuts in
government agencies, in line with the Contract with America agenda, while the
Administration promoted reductions in government through the efficiencies of
reinvention. The NPR was used to articulate the Administration's position during this
period, but the Administration's ultimate success did not provide a clear mandate for
the future form or scope of government. One analyst observed:
Despite the rhetorical skirmishes, there was little real sorting out of the
government's functions, reorganizing of its operations, or shrinking of its role. In
the end the Clinton administration maneuvered its way out of the crisis by
outflanking congressional Republicans. If the administration was politically
stronger, however, the reinventing government movement was weakened by the64
quick shifts in tactics and the diffusion of its focus.
First-Term NPR
On March 4, 1996, the Vice President consolidated the vision of the NPR to be
carried into the 1996 elections. Building on Phase I and II themes in the post budget
battle environment, Gore delivered a speech entitled "Governing in a Balanced Budget
World." The published documentation accompanying the speech articulated six
goals.65 Most of them, like improving customer service, covered familiar ground. In
addition, Gore advocated the conversion of appropriate agencies to performance-
based organizations (PBOs), which would have greater autonomy in their
management practices in return for increased accountability to performance standards.
The third status report, which was released later that year, just two months prior
to the election, made no mention of PBOs, but rather highlighted NPR themes and
summarized the reinvention achievements of the first three years on an agency-by-
agency basis. It reported $97.4 billion in savings based on agency implementation of
NPR recommendations or their adoption of NPR principles. It also reported
personnel reductions, procurement reform, personnel policy reforms, improved
customer service, reduced, more streamlined, and less coercive regulation of business,
and improved relationships with states and localities.66
Assessments of this period of the NPR have varied. One Brookings Institution
report suggested that, while reform was sustained within agencies, the central effort
63See note 33.
64Donald F. Kettl, Reinventing Government: A Fifth-Year Report Card, CPM Report 98-1
(Washington: Brookings Institution, 1998), p. 4.
65The speech is available at the archived NPR website,
[http://govinfo.library.unt.edu/npr/library/speeches/272e.html], and the supporting
documentation may be found at
[http://govinfo.library.unt.edu/npr/library/papers/bkgrd/balbud.html].
66Office of the Vice President, The Best Kept Secrets in Government: A Report to President
Bill Clinton (Washington: September 1996).
waned.67 Another analysis concluded that, at this point, "the NPR's agenda shifted to
fit [reelection] campaign needs."68 A Heritage Foundation report released in the fall
of 1996 compared NPR achievements to "putting new paint on an old termite-infested
house with a crumbling foundation," criticizing the reform for missing gross
management problems and increasing federal spending even with personnel
reductions. 69
NPR Renewed: Phase III
In the third and final phase of its reinvention effort, the NPR sought to redefine
itself, the goals it sought to accomplish, and the means by which it would do so. This
third phase began with the presentation of the Blair House Papers to a new Cabinet
in 1997 and culminated in the formal change of the NPR’s name to the National
Partnership for Reinventing Government in 1998. This period was characterized by
increasing efforts to involve the American public in government reinvention.
Reinventing the Reinvention Effort
In the third phase of its reinvention effort, from 1997-1999, the NPR engaged
in three campaigns to further define its agenda and its strategies, as well as reiterate
its support for past initiatives. The Blair House Papers, Businesslike Government:
Lessons Learned from America’s Best Companies, and the birth of the National
Partnership for Reinventing Government appeared to be attempts to stimulate both
public and intragovernmental support for the reinvention cause. However, according
to one observer, “the NPR has presented different faces without fundamentally
changing its direction, because its overall project of reform has been eclectic from the70
beginning.”
In January 1997, the NPR ushered in its third phase when, as Vice President
Gore explained, “President Clinton and I called the new Cabinet to Blair House to71
give them their reinvention marching orders.” The Blair House Papers
reemphasized traditional NPR rules and principles regarding the delivery of service,
the fostering of partnerships and community solutions, and the reinvention of
government to “get the job done with less.” However, the Blair House Papers
reiterated and further refined a concept new to the reinventing government debate, the
performance-based organization (PBO).
67Donald F. Kettl, Reinventing Government: A Fifth-Year Report Card, p. 5.
68Peri E. Arnold, Making the Managerial Presidency, p. 415.
69Scott A. Hodge, “Reinvention Has Not Ended the ‘Era of Big Government’,” The Heritage
Foundation, Backgrounder 1095 (Washington: Oct. 15, 1996), p. 30.
70Peri E. Arnold, Making the Managerial Presidency, p. 368.
71Office of the Vice President, Blair House Papers (Washington: January 1997), p. viii.
Although the PBO plan was first outlined by Vice President Gore in his March
1996 speech,72 the model was further refined and placed at the top of the NPR’s
agenda with the Blair House Papers. While the PBO is a term of art, is not yet
legally defined, and has been used to refer to varying levels of organizational
autonomy, the general PBO concept is spelled out in the Blair House
recommendations.
The PBO model largely relies on business-like practices and is discussed in
market terms. It is inspired by the Next Steps Initiative in Great Britain and is based
on the idea that organizations, when exempt from federal procurement and personnel
rules, will perform more efficiently under new sets of incentives and higher levels of
accountability. PBOs are to be managed by a hired chief executive, who will be held
accountable to the appropriate department secretary, and this relationship is to be
governed by an annual performance agreement. Thus, the chief executive has
incentive to ensure that the organization performs well. This is further reinforced by
making a portion of the chief executive’s salary dependent upon the organization’s
performance.
Underlying the PBO model is the separation of decisionmaking and policymaking
authority from implementation authority, and candidates for PBO status must fulfill
a certain number of prerequisites, which were set out in the Blair House Papers.
!Have a clear mission, measurable services, and a performance measurement system
in place or in development.
!Generally, focus on external, not internal, customers.
!Have a clear line of accountability to an agency head who has policy accountability
for the functions.
!Have top level support to transfer a function into a PBO.
!Have predictable sources of funding.73
Based on these prerequisites, the Clinton Administration identified its first
candidates for PBOs in both the Blair House Papers and the President’s FY1998
budget. They included the National Technical Information Service; the Patent and
Trademark Office (PTO); the Seafood Inspection Program of the Department of
Commerce; the Defense Commissary Agency; the Saint Lawrence Seaway
Development Corporation; the Government National Mortgage Association and the
Federal Housing Administration of the Department of Housing and Urban
Development; the Federal Retirement and Insurance Service of OPM; and the U.S.
Mint.
While the Blair House Papers acquainted government leaders with the
application of business techniques to governmental problems, the NPR’s October
72See note 65.
73Office of the Vice President, Blair House Papers, p. 42.
1997 publication, Businesslike Government: Lessons Learned from America’s Best
Companies, sought to do the same for the public. With the help of Scott Adams’s
“Dilbert” cartoons, the publication demonstrated that business could be a teacher to
government as Vice President Gore enlisted the aid of top executives from companies
like Disney, Federal Express, and Xerox in the reinvention effort. In the report, Gore
reaffirmed the desire to learn from business, noting that American companies “have
already been through the transformation from industrial-age to information-age
management. They have been through the learning curve, they have made the
mistakes and fixed them ....”74 While the report reiterated the basic NPR tenets, it was
significant for its efforts to make the NPR and its agenda readily accessible to the
American public. In the context of the NPR’s evolution, the report reflected the
changing nature of the NPR and its outreach beyond the Washington beltway to the
general public.
The pinnacle of “reinventing the reinvention effort” was reached in March 1998
when the National Performance Review, on its fifth anniversary, formally became the
National Partnership for Reinventing Government. Along with the new name, the
NPR adopted new strategies and principles. The NPR no longer sought merely to
make government work better and cost less. Instead, it “reorganized into eight teams
focused on partnering with federal agencies, state and local governments, the private
sector and citizen organizations to:”
!Deliver hassle-free service.
!Create a safer, healthier America.
!Develop stronger and safer communities and families.
!Make the economy stronger.
!Technologically transform America.
!Engage Americans in a conversation about reinventing government.
!Create the most well-managed government in history.
!Model the office of the future.75
The NPR sought to achieve these goals by fostering partnerships, encouraging
agencies to use “balanced measures,” creating an electronic government, and
publicizing its message. It focused on 32 “high impact agencies,” those with the most
interaction with the American people. According to NPR officials, the group’s new
plan was to align around a clear vision, value, and goal, and carry on a conversation
with Americans about what they value. The NPR would then use results that
74Office of the Vice President, Businesslike Government: Lessons Learned from America’s
Best Companies (Washington: October 1997).
75Anne Laurent, “Revamping Reinvention,” Government Executive, vol. 30, April 1998, pp.
Americans care about as performance measures. It would partner with “high impact
agencies,” encourage leadership and pursue fundamental reinvention through people,
process and information technology.76
Some observers believe the NPR was also perceived as potentially benefitting
Vice President Gore’s 2000 bid for the presidency. “NPR will be reviewed as if it
demonstrates the Vice President’s ability to lead, his fiscal understanding of
government, can he run a large organization,” NPR director Morley Winograd is
reported to have commented.77 From this viewpoint, the NPR attempted to broaden
its political appeal by re-focusing its mission.
As the NPR began to commit itself to these broader political goals, the gap
between “megapolitics” and front line management began to grow. While Winograd
contended that the NPR could create safer neighborhoods by publicizing
technological, cultural and process changes made by New York and Boston police,78
the process reforms that the NPR was undertaking, in the view of one observer, had
little or no direct connection with the achievement of the broader goals the NPR had
promised the American public.79 Winograd concluded that, “in seeking political
relevance and moving past process, NPR distanced itself from its ability to identify,80
accomplish and measure results through its own actions.” He judged that, in Phase
III, the NPR “risked making pledges on which it could not deliver and focusing
government employees on processes indirectly linked at best with Phase III’s broader
policy agenda.”81
Although the NPR spent much of 1997-1998 revamping its image and redefining
its strategies and goals, government reform efforts continued in other quarters.
Overhauling the structure and operations of the Internal Revenue Service (IRS), forth
example, was a major accomplishment of the 105 Congress. A number of
developments contributed to this overhaul. In 1984, the IRS began replacing its
outdated computer system. A few years later, GAO questioned the modernization
effort and alleged that the IRS had wasted billions of dollars on “unwisely chosen
computer purchases” due to the lack of any overall plan for the computer system and
a reluctance to engage computer experts outside the IRS. In response, Congress
mandated the National Commission on Restructuring the IRS in late 1995.82 Headed
by Senator Robert Kerrey (D-NE) and Representative Rob Portman (R-OH), the
commission sought to evaluate the IRS and make recommendations regarding its
organization and practices. In November 1997, the panel released its report, A Vision
for a New IRS, which recommended better congressional oversight of the IRS; a
statutorily created independent board of directors to oversee IRS management and
76Ibid.
77Ibid., p. 32.
78Ibid., p. 34.
79Ibid.
80Ibid.
81Ibid.
82109 Stat. 509.
operations; a strengthened role for the Secretary of the Treasury in setting tax policy;
and expansion of the authority of the IRS commissioner over personnel and senior
manager accountability. While legislation advancing the commission’s
recommendations was introduced with bipartisan support in late July 1997, it was met
with strong opposition from the Clinton Administration over the role of the proposed
independent board of directors.
Prior to the dissemination of the commission’s report, the Administration had
announced its intention to reform and reorganize the IRS. Overhaul of the IRS had
been one of the original 1993 recommendations made by the NPR. Eventually, a
comprehensive plan for IRS reform was unveiled by the Administration in October
1997, with an announcement that it would be implemented immediately. Based on
a report by Vice President Gore and Treasury Secretary Robert E. Rubin, the plan
focused on improving customer service, giving taxpayers new ways to solve
problems, expanding taxpayer rights and remedies, and creating a new IRS board of83
trustees. However, a few days later, the Clinton Administration abandoned its
opposition to congressional reform of the IRS, and legislation embodying the
recommendations of the IRS reform commission was subsequently adopted in the
House.
In January 1998, the Senate Committee on Finance revealed abuses by the IRS
against taxpayers it had accused of non-compliance. These abuses were said to stem
from basing performance evaluations of employees on their success in bringing in
revenue. The chairman of the Committee on Finance, Senator William V. Roth, Jr.
(R-DE), drafted a reform bill and offered it for consideration and markup at a
committee meeting on March 31. Roth’s bill was adopted in May. A conference
report was produced and agreed to by both chambers shortly thereafter, and the84
measure was signed into law by the President on July 22, 1998.
Performance-Based Organizations
While the NPR and the Clinton Administration identified various candidates for
conversion to the PBO model, congressional interest was initially confined to the case
of the Patent and Trademark Office (PTO). Congressional attention to theth
reconstitution of the PTO as a PBO began early in 1995, and the 104 Congress
subsequently saw an Administration proposal, three House bills, and two Senate bills
on the matter offered for consideration. All of these measures, even those converting
the PTO into a government corporation, embraced basic PBO concepts of85
“marketizing” governmental functions in order to improve the delivery of services.
83Al Gore and Robert E. Rubin, “Report on the IRS: Reinvention, Recourse, Rights, Reform,”
available from [http://www.ustreas.gov/press/releases/prirs1.htm].
84112 Stat. 685.
85Government corporations are federal agencies established by Congress to serve a public
purpose by performing a market-oriented service which produces enough revenue to meet or
approximate the expenditures of the corporation. They share a number of characteristics with
PBOs, such as the “marketization” of activities and the application of business practices to
(continued...)
However, none of them received final legislative approval, and the issue of PTO
conversion continued into the 105th Congress, when two omnibus bills and an
additional Senate proposal were introduced. Again, the proposed measures were not
passed by Congress, and the Administration indicated that legislation converting the
PTO to PBO status would be offered in the 106th Congress (see H.R. 1907).
In many regards, converting the PTO to PBO status did not succeed because the
NPR seemingly failed to anticipate congressional, union, and intragovernmental
unwillingness to increase the autonomy of the PTO by making it a PBO. Without an
effective strategy for dealing with Congress, the NPR had relied on administrative
action to accomplish many of its goals. However, the conversion of the PTO to PBO
status could occur only through legislative action, and there was a considerable
amount of congressional resistance to relinquishing control over agencies as “[t]he
PBO concept would place more power in the hands of the few, [and] Congress would
lose some of its oversight authority.”86 Furthermore, labor unions strongly opposed
a PBO conversion that would exempt the PTO from existing personnel rules. In
addition, some saw executive branch resistance to PBO conversion legislation freeing
the PTO from the General Services Administration’s monopoly on real property
services, which the Administration’s bill did not do.87
The first PBO was created with the enactment of the Higher Education
Amendments of 1998 when the Department of Education’s student financial services
were vested in a new Office of Student Financial Assistance (OSFA).88 Headed by
a chief operating officer selected by the Secretary of Education, the OSFA was given
independent control of its budget and finances, personnel decisions and processes,
procurements, and other administrative and management functions. Compensation
of the chief operating officer was based partially upon organizational performance.
In return for this independence, the OSFA must improve student services, reduce
costs, and increase the accountability of administration. The office’s performance is
measured in accordance with a five-year plan, developed by the Secretary of
Education and the chief operating officer of the OSFA, that establishes measurable
goals and objectives for the organization. Furthermore, oversight of the organization
is performed through annual reports submitted to Congress through the Secretary,
who maintains authority to direct the PBO in the implementation of its functions.
85(...continued)
governmental functions. See U.S. Library of Congress, Congressional Research Service,
Federal Government Corporations: An Overview, by Ronald C. Moe, CRS Report RL30365
(Washington: Nov. 1, 2000).
86U.S. Congress, House Committee on Government Reform and Oversight, Oversight of
Performance-Based Organizations, hearing, 105th Cong., 1st sess., July 8, 1997 (Washington:
GPO, 1998), p. 5.
87Alasdair Roberts, “Performance Based Organizations: Assessing the Gore Plan,” Public
Administration Review, vol. 57, November-December 1997, p. 470.
88112 Stat. 1581, at 1604; see Brian Friel, “Congress Creates Performance-Based
Organization,” available at [http://www.govexec.com/dailyfed/0798/071498b1.htm].
The OSFA example highlights the difficulties that the NPR had in converting
government agencies into PBOs. While the Administration had long sought to
convince Congress to convert the PTO and Saint Lawrence Seaway Development
Corporation to PBO status, the Department of Education proposal was easily
accepted. In the House, the Higher Education Amendments of 1998 were adopted
on a 414-4 vote, and in the Senate, they were approved on a 96-1 vote.
Subsequently, the conference report was passed by the House on a voice vote and by
the Senate on a 96-0 recorded vote. The ease of passage may be attributed to the
genesis of this particular initiative. Although the PBO model had been developed and
promoted by the Administration, the initiative for the creation of OSFA came from
the Republicans on the House Committee on Education and the Workforce, which
adapted the Administration’s idea and applied it to the financial aid services.
The creation of the first PBO revitalized Administration efforts to reinvent
government by marketizing governmental functions. In February 1999, the President’s
FY2000 budget indicated that the PTO, Defense Commissary Agency, U.S. Mint, and
Seafood Inspection Service, which had been proposed for conversion to PBO status
in past years, would be offered again as PBO candidates in the 106th Congress.
Other entities recommended for PBO status were the Rural Telephone Bank, the
National Technical Information Service, and the Federal Lands Highway Program.
Late in 1999, the President signed a consolidated appropriations bill that included the
American Inventors Protection Act, which reorganized the PTO as an independent
agency within the Department of Commerce, but, contrary to the claim of the89
reconstituted PTO, did not transform it, in the view of many analysts, into a PBO.
In the closing weeks of his tenure, President Clinton, with E.O. 13180 of
December 7, 2000, directed the Secretary of Transportation, consistent with his legal
authorities, to establish a PBO—to be known as the Air Traffic Organization
(ATO)—within the Federal Aviation Administration (FAA).90 He had recommended
the establishment of such an entity to Congress in 1997 and, more recently, in his
FY2001 budget, but legislators had shown little interest in the proposal. Intended to
produce more efficient management of air traffic services at a time when airline delays
and cancellations were mounting, the new ATO would count some 37,000 FAA
employees engaged in air traffic control, air traffic facilities maintenance and repair,
and selected research and acquisitions activities. However, the statutorily mandated
Chief Operating Office of the current Air Traffic Control System was to head the
ATO, a feature differing from the PBO model advanced by the NPR in 1996.
There were indications in May 2001 that the successor Bush Administration was
interested in converting the Department of State’s Foreign Buildings Operation, which
serves as the landlord for U.S. facilities overseas, into a PBO.
89See 113 Stat. 1537-574.
90See Federal Register, vol. 65, Dec. 11, 2000, pp. 77493-77494.
The Report Cards and Beyond
In a late 1998 website bulletin, NPR staff summarized the organization’s 1993-
1998 accomplishments. Coupling this summary with the NPR’s agenda suggests that
the NPR measures succeeded in a number of ways. Included as indicators of success
were cost savings, decreased “red tape” and regulations, downsizing, the use of
reinvention principles by federal employees, and the creation of laws based on NPR
recommendations. The summary proffered the following major accomplishments of
the NPR.
!Savings total[ing] $137 billion.
!Federal agencies have published more than 4,000 customer service standards for more
than 570 organizations and programs.
!Agencies have eliminated more than 16,000 pages of regulations. President Clinton
signed an Executive Order requiring rules and other public documents to be written
in plain language.
!Government was reduced by 351,000 positions. Reductions occurred in 13 of 14
departments. (Justice increased crime fighting.)
!More than 12,000 Hammer Awards have been presented to teams of federal workers
and their partners in industry and state and local governments for using reinvention
principles to create a government that works better, costs less, and delivers results
Americans care about.
!About 340 reinvention labs are reengineering government processes and using
technology to unleash innovations that excite customers and employees alike with
more flexible internal systems and improved services to the public.
!The Congress has passed and President Clinton has signed more than 83 laws so far91
enacting NPR recommendations.
These indicators and measures of success, however, were not accepted in some
quarters. For example, in a July 1999 report, the GAO questioned the amount of
savings claimed by the NPR, saying:
NPR claimed savings from agency-specific recommendations that could not be
fully attributed to its efforts. In general, the savings estimates we reviewed could
not be replicated, and there was no way to substantiate the savings claimed. We
also found that some savings were overstated because OMB counted savings
twice, and two of the estimates were reported incorrectly, resulting in claims that92
were understated.
91National Partnership for Reinventing Government, Summary of Accomplishments, 1993-
1998;modified and updated version available at
[http://govinfo.library.unt.edu/npr/whoweare/appendixf.html].
92U.S. General Accounting Office, NPR’s Savings: Claimed Agency Savings Cannot All Be
(continued...)
The NPR was concerned with downsizing as a way to combat “big government”
and to make government work better and cost less. However, one seasoned observer
states, these downsizing efforts proved detrimental to morale among government93
employees and failed to win political favor with the American public. This
downsizing produced larger cuts in the front-line government employees than in the
middle levels of federal government. This development was contrary to the
Administration’s promise to cut middle management, who “pushed paper and
contributed to the bureaucracy,” and to preserve the top managers, who made
decisions, and the front-line employees, who delivered the services.94
This observer, Donald Kettl, gave the NPR and its government reinvention
efforts a favorable review and an overall grade of B. He acknowledged that the NPR
had forged new ground, sustained the reinvention effort, and realized important
accomplishments. Among these, he gave procurement reform an A and the NPR an
A+ for effort. However, he gave the NPR a D for identifying the objectives of
government and for relations with Congress. Incomplete grades were assigned for
improving results in “high impact” programs and for service coordination.95
While Kettl delivered a favorable, yet, critical, review of the NPR, he brought
to light important challenges that the organization would have to grapple with in order
to continue reinvention efforts in the remaining months of the Clinton Administration.
He indicated that perhaps the greatest challenge to the NPR’s efforts had been a
guarded and, sometimes, resistant Congress.
[T]he NPR’s strategy of integrating government services conflicted with
Congress’s traditional—and fragmented—committee jurisdictions. For the NPR’s
first 18 months, a not always friendly Democratic Congress saw little reason to
tangle with management reform while fighting battles on health care and other
Clinton proposals. For the next three years, a Republican Congress has no interest
in acting on initiatives put forward by the leading candidate for the Democratic96
party’s 2000 presidential nomination.
However, Congress has not been the only entity to challenge NPR reinvention
efforts. Resistance also exists within the executive branch. Kettl further found that
the NPR failed to enlist support for reinvention from the Administration’s own
political appointees and from senior career civil servants. This failure, he noted,
produced an NPR campaign with uneven effects among the agencies, particularly
where appointed leaders failed to connect with the reinvention effort.97 Moreover,
executive branch concerns about deregulation and PBOs have delayed the
implementation of the Administration’s PBO plan. “The delay,” according to one
92(...continued)
Attributed to NPR, GAO Report GAO/GGD-99-120 (Washington: July 1999), p. 13.
93See Donald F. Kettl, Reinventing Government: A Fifth Year Report Card, pp. 5, 34.
94See Ibid., pp. 19-20.
95See Ibid., p. ix.
96Ibid., p. 34.
97Ibid.
observer, “is largely attributable to difficulties in resolving internal disagreements
about the legislative freedoms that ought to be given to these organizations.”98 This
has been exacerbated by the ambivalence of central management agencies and the
reluctance of parent departments to give greater autonomy and flexibility to their
agencies.
Successes, Problems, and Remaining Questions
Just before the NPR began its final year of activities and operations, it crafted.
In late 1998, a two-year strategy designed to “forever change government” through
five initiatives.
!Achieve outcomes no one agency can achieve alone.
!Agencies use a balanced set of measures.
!Create an electronic government.
!Transform agencies with the greatest impact on Americans.
!Mobilize America’s real heroes to get the message out.99
Although the realization of this plan required more time than would be available
to the NPR, what may be said, in the aftermath of the NPR experience, about its
legacy—successes, problems, and remaining questions?
Successes
Concerning successes, Peri E. Arnold, a veteran analyst of federal reorganization
and reform efforts, has suggested that the NPR be considered in terms of the
implementation of its specific recommendations, the instillation of “a new culture of
administration within the executive branch,” and the creation of “a centrist coalition
to support” the leadership of “a pragmatic Democratic president.”100
Reviewing the record concerning the implementation of NPR recommendations,
Arnold offered the following summary of the situation.
In reports issued in December 1994 and again in June 1996, the GAO tracked
adoption of the NPR’s September 1993 recommendations. The 1994 GAO
assessment of the adoption of the September 1993 NPR recommendations found
that there had been some implementation action taken on 93 percent of those
recommendations; of these 4 percent had been fully implemented, 37 percent had
98Alasdair Roberts, “Performance Based Organizations: Assessing the Gore Plan,” p. 470.
99John Kamensky, “A Brief History,” National Partnership for Reinventing Government
(Washington: January 1999), pp. 6-9, available at
[http://govinfo.library.unt.edu/npr/whoweare/historyofnpr.html]; Bill Landauer, “Gore’s NPR
Must Reform Itself to Survive,” Federal Times, Sept. 6, 1999, p. 5.
100Peri E. Arnold, Making the Managerial Presidency, p. 419.
been partially implemented, and 50 percent had begun implementation. Another
purposes, 2 percent could not be assessed given limited information, and only 5
percent of the recommendations had seen no action at all. In a 1996 study the
GAO confined examination to just those recommendations for which adoption had
been claimed in the September 1995 Common Sense Government [report]. That
second annual NPR progress report claimed that a third of its recommended
actions had been completed. The GAO’s report demurred, finding that 24 percent
of the recommendations had been fully implemented (and with most others still in
progress, as had been reported by the GAO in 1994). Thus, in one year the rate
of completion of recommendations had grown from 4 percent to 24 percent, and
there seemed general support for action on many of the remaining101
recommendations.
To this record of implementation or partial implementation of many NPR
recommendations may be added some other concrete achievements. For example, as
Arnold noted, while agency action accounted for the implementation of at least 292
recommendations, the NPR was not completely lacking in legislative success.
Legislative action was the second most common means of implementation [of NPR
recommendations]. By December 1994, 169 of the recommendations were
introduced within legislation and 83 recommendations were enacted. Presidential
actions addressed at least 86 recommendations. Also, congressional support for
reinvention continued into the Republican Congress after 1994. There was a
substantial synergy between the new Republican agenda for reducing government
and the NPR’s recommendations for simplifying government. Thus legislation
such as the Unfunded Mandate Reform Act of 1995, the Small Business Lending
Enhancement Act of 1995, and several of the 1996 appropriations acts102
incorporated NPR recommendations.
The NPR later reported that, as of March 1998, for those recommendations
requiring presidential or congressional action, “President Clinton signed 46 directives
and Congress passed and the President signed over 85 laws.”103
Another accomplishment proffered by the NPR: cutting the federal workforce
by 351,000 positions, making it “the smallest since Kennedy held office and, as a
percentage of the national workforce, the smallest since 1931.”104 Donald Kettl noted
that “careful analysis of the long-term employment trends shows that downsizing in
the Pentagon began before the NPR’s launch,” and “cynics contended that the NPR
simply ratified reductions in the Defense Department’s civilian work force that were
101Ibid., pp. 419-420; the GAO reports mentioned are U.S. General Accounting Office,
Management Reform: Implementation of the National Performance Review’s
Recommendations, GAO Report GAO/OCG-95-1 (Washington: December 1994); U.S.
General Accounting Office, Management Reform: Completion Status of Agency Actions
Under the National Performance Review, GAO Report GAO/GGD-96-94 (Washington: June
102Peri E. Arnold, Making the Managerial Presidency, pp. 421-422.
103John Kamensky, “A Brief History,” p. 5.
104Ibid.
going to occur anyway.” Nonetheless, he concluded that, “if the NPR accomplished
nothing else, it certainly produced a substantial and sustained reduction in federal
employment—virtually across the board—in a way never before seen in the federal105
government.”
One other achievement that the NPR reported was the elimination of some
with another 31,000 pages being rewritten in plain language.
Additionally, the NPR claimed cost savings totaling about $137 billion as a result
of its efforts, although that figure was recently contested by GAO. Nonetheless, Kettl
advised:
While the NPR unquestionably produced cost savings, especially in procurement
and reduction in government employment, assessing which of the NPR’s
recommendations produced how much savings is a virtually impossible job. In
part, this is because it usually proved difficult to predict what costs would have
been without the NPR. In part, this is because the government’s cost account107
systems frequently make such analyses impossible.
Another consideration offered by Arnold regarding the success of the NPR
concerned the instillation of “a new culture of administration within the executive
branch.” Arnold commented:
Predecessor comprehensive reform efforts have been static. They attempted a
wave of reforms at a point in time, aiming at enhancing presidential managerial
capacities and streamlining federal administrative structure and processes. In
contrast, the NPR seeks to be dynamic. To the degree that anything unites its
recommendations, the NPR’s advocates understand its reforms as creating a
changed economy of incentives within federal administration such that individuals
will be motivated to be creative about the way they work, more productive in their
work, and more responsible for the success of their organization. In the
vocabulary of reinvention, the attitudes consistent with reinvention’s economy of108
incentives would constitute a new administrative culture.
Concrete achievements claimed in this area include the honoring of over 1,200
federal innovation teams with the Vice President’s Hammer Award and the creation
of over 350 Reinvention Labs to test ways that agencies could improve their
performance and customer service by reengineering work processes and eliminating
unnecessary regulations.109 Reporting on the Reinvention Labs in March 1996, the
GAO indicated that “the labs’ results suggest a number of promising approaches to
improving existing agency work processes,” but noted that “the real value of the labs
105Donald F. Kettl, Reinventing Government: A Fifth-Year Report Card, p. 18 (emphasis in
original).
106John Kamensky, “A Brief History,” p. 5.
107Donald F. Kettl, Reinventing Government: A Fifth-Year Report Card, p. 22.
108Peri E. Arnold, Making the Managerial Presidency, p. 423.
109John Kamensky, “A Brief History,” p. 5.
will be realized only when the operational improvements they initiated, tested, and
validated achieved wider adoption.”110
Another success cited was the commitment of over 570 federal organizations to
more than 4,000 customer service standards.111
Finally, regarding Arnold’s third consideration, how successful had the NPR
been in creating “a centrist coalition to support” the leadership of President Clinton?
Arnold commented:
Bill Clinton initiated the NPR to address a governing context that was
substantially different from that in which presidents had earlier used administrative
reform to construct the managerial presidency. The emergent context of the lateth
20 century is fragmented and characterized by weak parties, mercurial interest
groupings, weakened public institutions, and a technology allowing intense and
pervasive public focus on presidents. Like Carter and Reagan before him, Clinton
sought to use administrative reform in this emerging context to respond to public112
hostility toward government.
Perhaps the NPR bespeaks success in this regard when reporting:
Most importantly, public trust in the federal government is finally increasing
after a 30-year decline. Various polls have shown a clear and steady increase over
the past four years. While it is not clear this is directly linked to the results of113
reinvention, we believe reinvention has made an important contribution.
Arnold, however, appeared to be more certain about this area of success, and
concluded:
The reinvention of government has been a side show in some respects. After all,
administrative reform is “a second-level issue” in presidential politics. However,
reinvention is an enterprise that reflects well upon Clinton and Gore. It reinforces
their own optimal self-descriptions and gives testimony that these leaders are114
addressing the problems that trouble most Americans.
In September 2000, a GAO report concluded that the NPR reinvention effort had
been largely successful, with more than 90% of key Clinton Administration
recommendations having been fully or partly implemented. The report was based
110U.S. General Accounting Office, Management Reform: Status of Agency Reinvention Lab
Efforts, GAO Report GAO/GGD-96-69 (Washington: March 1996), p. 3.
111John Kamensky, “A Brief History,” p. 5.
112Peri E. Arnold, Making the Managerial Presidency, p. 433.
113John Kamensky, “A Brief History,” p. 5.
114Peri E. Arnold, Making the Managerial Presidency, p. 434.
upon a review of 72 NPR recommendations by 10 federal agencies, and found that 33
of them were fully implemented and another 30 were partly implemented.115
Problems
Some of the problems encountered by the NPR were noted previously and those
identified here should not be regarded as constituting an exhaustive list.
Although the NPR enjoyed some cooperation from Congress, as the legislative
record of NPR recommendations legislated into law indicates, the NPR does not
appear to have had a clear strategy for working with Congress. Most NPR
recommendations seem to have been implemented through a strategy of agency
acceptance and presidential orders. The overall record, Arnold observed, reflects
“Congress’s support for individual items” among the NPR recommendations “and its116
disinterest in the NPR’s conception of reinvention.” Agreeing with this assessment,
Kettl concluded:
Efforts to develop legislative support for NPR initiatives have, with the exception
of procurement reform, been weak and ineffective. Support from Congress:117
poor.
The NPR’s efforts sometimes resulted in a loss of morale among federal civil
servants. Part of reason for this problem, as Kettl noted, was the tension between the
NPR’s emphasis, on the one hand, on downsizing and reengineering and, on the other
hand, customer service.
A flatter organization, driven by customer service, demands energetic and highly
motivated employees. A cost-cutting, reengineered and downsized operation often
discourages employees. Trying to do both risks putting the basic incentives at
cross purposes; focusing on either risks leaving the corporation stuck in old-style,
less productive approaches. The NPR took in the competing ideas without118
fundamentally sorting them out.
Coupling morale deflation with agency leadership in support of NPR reinvention
efforts, Kettl offered the following scenario.
In a 1996 survey conducted by the Merit Systems Protection Board, only 37
percent of federal employees believed that their organization had made reinvention
a top priority. The NPR’s management improvement goals penetrated far less into
the Pentagon than in civilian agencies. Morale in many agencies was poor. Only
20 percent of federal workers said that the NPR had brought positive change to
government. This response, however, varied directly with how much workers
115U.S. General Accounting Office, Reinventing Government: Status of NPR
Recommendations at 10 Federal Agencies, GAO Report GAO/GGD-00-145 (Washington:
September 2000).
116Peri E. Arnold, Making the Managerial Presidency, p. 422.
117Donald F. Kettl, Reinventing Government: A Fifth-Year Report Card, p. ix.
118Ibid., p. 9.
believed that their agencies’ officials had made the NPR’s goals a top agency
priority. Where the NPR was a top priority, 59 percent of employees thought
productivity had improved; where it was not, just 32 percent saw productivity
improvements. The lesson: where agency managers promoted the NPR’s goals,
employees were three times more likely to think that government organizations had
made good use of their abilities. They were almost twice as likely to believe that
they had been given greater flexibility. The NPR succeeded in motivating
employees, quite predictably, to the degree to which top government officials made
this an important goal. Where they did not—and the survey suggests that the NPR
deeply penetrated only about a third of all federal agencies—the NPR became119
known principally for its downsizing focus and consequently motivation lagged.
Kettl also suggested that the NPR had a public confidence problem, including
both outreach or visibility and credibility.
A June 1998 Scripps Howard News Service survey showed that citizens tended not
to believe that the NPR had accomplished what it claimed. Although 54 percent
of those surveyed said that they had heard of reinventing government, 59 percent
did not believe that the administration had in fact reduced the number of federal
employees as the NPR claimed, even though those claims were fully accurate.
More respondents—61 percent—did not believe that the federal government had
become more efficient, even though there is a strong case for substantial
improvements. Coupled with the Republicans’ takeover of Congress in 1994 and
the NPR’s constant problems in gaining political traction for its message,120
reinventing government ran headlong into tough confidence problems indeed.
The NPR also had a problem framing its approach to, and focus on, reform. The
NPR effort lacked a theoretical base and cohesion among its broad range of ideas.
The NPR largely devoted its attention to the process of government rather than the
more basic questions of what government should do, which many experts believe
should come first. James D. Carroll, a public administration expert, observed:
In defining government as an appendage of the economy, the NPR strips the
federal government of what is distinctively governmental—ultimately enforcement
of binding norms through legitimate coercion to maintain a legal, normative order.
In treating government as a Wal-Mart, the NPR ignores the fact that many
operational assumptions based on customer service have implications for broader
systems of values such as the rule of law, representative government, separated121
and shared powers, and individual liberty.
Carroll also observed that the NPR gave no attention to the constitutional basis
of American national government or its significance for administration. Ultimately,
he concluded, these theoretical shortcomings resulted in some critical myopia in the
NPR reform effort.
119Ibid., p. 17.
120Ibid., p. 36.
121James D. Carroll, “The Rhetoric of Reform and Political Reality in the National
Performance Review,” Public Administration Review, vol. 55, May-June 1995, p. 310.
Neither phase [I or II] of the NPR directly and systematically addressesst
trends that probably will shape much of public administration in the early 21
century. The first is the imbalance between consumption and savings and
investment in the United States marked by concern with deficits and debt,
entitlement spending, demographic change, and declining private and public
investment. The second is the challenge of sorting out relationships and
responsibilities among levels of government, and governments and other
organizations. The third is reconciling traditions of constitutional governance and
legal accountability with the search for flexibility, innovation, and productivity in122
addressing managerial and programmatic issues.
Kettl found there was a compounding effect to some of the NPR’s shortcomings.
NPR is most notable for its failure to grapple with ... basic organizational
issues. It reduced the number of supervisors without transforming federal
management practice. Its top officials preached the virtues of reducing middle
management just as the private sector was rediscovering the importance of middle
managers as “high-impact players.” The NPR failed to deal with the layering of
government and, especially, with the 3,000 political appointees that encrust the top
of the federal bureaucracy—for the obvious political reasons. That failure,
coupled with its failure to enlist those appointees aggressively in its cause, marked
a major shortcoming of the NPR. It also made it harder for the NPR to deliver on
its promise to downsize middle-level management en route to better customer
service. It is hard to reduce the distance from top managers to the shop floor when
the shop floor—those who actually deliver the government’s goods and
services—increasingly lies outside the government [as a consequence of123
contracting out].
Finally, in addition to prompting a downsizing of frontline federal employees, not
middle managers, and otherwise lowering the morale of many civil servants,124 the
NPR, Carroll noted, did “not propose a systematic agenda for rebuilding the career
service,” and its “overall message ... on the career service is ambivalent or
negative.”125
Remaining Questions
Two of Carroll’s comments concerning problems NPR engendered in its
reinvention effort suggest some matters that may continue to draw policymakers’
attention. The first of these involves addressing trends likely to shape much of public
debate in the early part of the 21st century—the imbalance between consumption and
savings and investment in the United States, entitlement spending, demographic
change, and declining private and public investment; sorting out relationships and
responsibilities among different levels of government as well as governments and
122Ibid., p. 302.
123Donald F. Kettl, Reinventing Government: A Fifth-Year Report Card, pp. 21-22.
124See Ibid., pp. 19-20.
125James D. Carroll, “The Rhetoric of Reform and Political Reality in the National
Performance Review,” p. 309.
other organizations; and reconciling traditions of constitutional governance and legal
accountability with realizing flexibility, innovation, and productivity in addressing
managerial and programmatic issues.
A second question concerns the need for a systematic agenda for rebuilding the
career civil service and pursuing that agenda to establish new policy. Addressing this
question at the end of 1999, James D. Carroll, noting that the NPR “postponed the
examination of some fundamental realities that future efforts to improve federal
management will have to address, suggested three items for the 21st century
management reform agenda. The first of these derived from “the decline of the
traditional administrative state and the rise of the entitlement state.” Carroll
commented:
In fiscal year 1962, 63 percent of federal spending was discretionary in that it was
appropriated on an annual basis in response to the President’s budget proposal.
In fiscal year 2000, only 33 percent of spending is discretionary. The remainder
is legally committed under entitlement, debt instrument, or other devices.
The administrative state of the 1930s and thereafter was based on a problem-
solving model of public management. In this model, in response to constituent and
interest group pressures, politicians defined problems in legislative form. They
then assigned the problems to agencies. The agencies’ managers and technicians
then exercised their skill, judgment, professionalism, and discretion in planning,
budgeting, and otherwise defining and acting upon a problem. In the entitlement
state, the President and Congress establish program structures that constrain
managerial discretion as well as future legislative direction. Budgeting rules,
particularly the Budget Enforcement Acts, have reinforced the emergence of these
algorithmic structures and processes. The challenge for the next agenda for public
management is to determine how the entitlement state can be configured to allow126
the exercise of managerial judgment and skills.
A second item derived from “the emergence of Congress as a co-manager of the
administrative branch,” including government corporations and regulatory
commissions. In Carroll’s view, factors strengthening congressional influence over
administration included “the program structures and other provisions of the
entitlement state”; the congressional role in the budget process; and “the
aggressiveness of Congress in establishing a new, although somewhat fragmented,
framework for federal management in the 1990s,” with such laws as the Chief
Financial Officers Act, the Government Performance and Results Act, and the Federal
Financial Management Improvement Act, among others. The resulting agenda item
was “for the executive and Congress to sort out who is responsible for what in agency127
and program management.”
A third item Carroll cited arises from changes in constitutional law. “Federal
managers,” he said, “increasingly must understand the Supreme Court’s actions in
order to act effectively and legally.” Among these actions, the Court has held that
126James D. Carroll, “An Agenda for Reforming Federal Management in the 21st Century,”
The Business of Government, Fall 1999, pp. 16-17.
127Ibid., p. 17.
“privatization and related forms of the new public management are subject to
constitutional scrutiny”; “launched a fundamental re-examination of the distribution
of powers in the federal system, focused on questions of the limitations of the federal
government’s powers”; and “continued to hold individual public administrators liable
in money damages for their failure to consider the constitutional implications of their
actions under federal civil rights legislation and other provisions of law.”
Consequently, the item for the federal management reform agenda is “to develop new
public management frameworks that enable public managers to function effectively
in this new constitutional framework.”128
In testimony offered at a May 4, 2000, Senate Governmental Affairs
subcommittee hearing on reinventing government, a GAO representative identified six
“of the more important management problems that will confront the next Congress
and administration” in the period after the NPR effort:
!adopting an effective results orientation,
!coordinating crosscutting programs,
!addressing high-risk federal functions and programs,
!developing and implementing modern human capital practices,
!strengthening financial management, and
!enhancing computer security.129
Reinvention downsizing of the federal workforce was seen as resulting in a
problematic legacy. According to the GAO witness:
the manner in which the downsizing was implemented has short- and long-term
implications that require continuing attention. The management control positions
NPR sought to decrease were barely reduced as a proportion of the workforce as
a whole, and at some agencies they increased.
In addition, our reviews have found that a lack of adequate strategic and
workforce planning during the initial rounds of downsizing by some agencies may
have affected their ability to achieve organizational missions. Some agencies
reported that downsizing in general led to such negative effects as a loss of
institutional memory and an increase in work backlogs. ...
128Ibid.
129U.S. Congress, Senate Committee on Governmental Affairs, Has Government Been
“Reinvented”?, hearing, 106th Cong., 2nd sess., May 4, 2000 (Washington: GPO, 2000), p. 34.
Although we found that agencies’ planning for downsizing improved as their
downsizing efforts continued, it is by no means clear that the current workforce is130
adequately balanced to properly execute agencies’ missions today.
Continued improvements in acquisitions management were thought to be needed.
Reform efforts, including the Federal Acquisition Streamlining Act of 1994 and
the Clinger-Cohen Act of 1996, have focused principally on simplifying the
process for buying commercial products and services and on attempting to improve
decisionmaking in acquiring information technology.
Despite these reforms, however, the products and services the government
buys all too often cost more than expected, are delivered late, or fail to perform as
anticipated. No commercial business would remain viable for very long with
results like these. Problems are particularly evident in the two areas where most
of the dollars are spent—on weapons systems and information technology.
Significant improvements in these areas, as well as in the skills of the acquisition131
workforce, are needed in order to produce better outcomes.
Finally, it was also thought that the NPR’s initiatives to improve the federal
regulatory system by streamlining agency rulemaking and cutting regulations had, at
best, “yielded mixed results.”132
By implication, the comment by the GAO witness that prevailing management
problems “continue to demand attention” poses the question of a successor to the
NPR. Options include another temporary task force like the NPR, a temporary
national study commission on government reform, a designated unit in an existing
agency (e.g., OMB, GAO), or the creation of a new agency, such as an Office of
Management, perhaps vested with some of the management responsibilities currently
assigned to OMB.
Closure
The NPR continued operations until the final day of the Clinton Administration,
January 19, 2001. Documents available from the NPR Web site as of that closing
date were subsequently made available via the Internet through a Web site jointly
created and maintained by the Government Printing Office and the University of
North Texas Libraries to facilitate continued access to this electronic archival
repository ([http://govinfo.library.unt.edu/npr/default.html]).
130Ibid., pp. 40-41.
131Ibid., p. 42.
132Ibid., p. 43.