By Tory Newmyer, writer
FORTUNE -- What's becoming clearer now probably should have been obvious from the beginning: The IRS scandal sprung from bureaucratic incompetence -- and not some grand conspiracy to stifle the Obama administration's opponents that goes all the way to the top.
That won't deter the President's lead inquisitor, House Oversight and Government Reform Chairman Darrell Issa (R-Calif.), from pursuing gossamer-thin suggestions that IRS officials were marching on White House orders. And that's too bad. Because as this investigation circles the drain, it will almost surely focus on decreasingly relevant trivia while ignoring a big, actual problem laid bare by the scandal. It will let President Obama off the hook for a broken promise so far ignored. And good, or at least better, government will suffer for it.
The problem quite simply is that the civil service is broken. I hear a version of the same line from Democratic staffers who leave comparatively lean Capitol Hill operations for executive branch gigs outside the White House: "I'm thinking about becoming a Republican," they say, mostly joking. But they're serious that the bureaucratic rot they encounter is bad enough to make them think small-government types have a point. It's not just anecdotal: The federal government's 2012 survey of 687,000 of its own employees found only 22% believe pay raises are linked to job performance; 34% think promotions are merit-based; and 29% see managers taking steps to deal with underperforming workers who can't or won't improve. And those numbers are all trending downward.
One manifestation of the anti-meritocracy is its job-security. A USA Today analysis in 2011 found in many agencies, workers are more likely to die on the job than get fired. Fairly or unfairly, that fact has been personified by Lois Lerner, the IRS official in charge of tax-exempt organizations now on paid administrative leave following her refusal to testify before Congress. Firing her, we've learned, could invite the administrative migraine of wading through months or even years of appeals. With that kind of career immunity it's no wonder IRS employees spent close to $50 million on 220 conferences over the last few years -- the latest revelation stoking outrage over the agency.
Obama diagnosed the government bloat in his 2011 State of the Union address, calling for a sweeping federal reorganization. He rolled out a reform proposal a year later and sent then-Controller Danny Werfel, now serving as the IRS's interim leader, to testify on its behalf. Werfel told a Senate committee that "changing the way Washington works is a priority for the president." But the plan went nowhere as election-year politics swamped policymaking, and it hasn't gotten a mention since.
Now would be a good time to revive and revise it. "The current system fails in every task it was designed to do," says Paul Light, a professor at New York University's Robert F. Wagner School of Public Service. "It's slower hiring new employees, permissive in promoting them with time on the job, and negligent disciplining poor performers."
Pointing to the last meaningful overhaul of civil-service rules -- led by former President Herbert Hoover during the Truman administration -- Light says Obama should enlist Al Gore to lead a commission that will tackle how to rewrite federal personnel policies. It may sound like a pipe-dream, but Light says, "I just don't know anybody who's got the guts or the commitment to do it" besides Gore, who made streamlining government the central project of his vice presidency. And there is a template for how to do it successfully, Light says -- the Government Accountability Office has shed staff while dramatically improving its output, the result of a decades-long effort by the outfit to rewire itself.
The problem is that while scale of the mess calls for coordinated bipartisan action, the political incentives are all aligned against it. President Obama has better things to do with the remainder of his second term than tackling such a thankless project, especially as the economic rebound diminishes the urgency of deficit cutting. Congressional Democrats are loath to confront the public-sector unions invested in protecting the status quo. And Congressional Republicans are more interested in embarrassing the White House and demonstrating government's core dysfunction than in doing the hard work of fixing it.
Emerging growth companies may need emerging growth banks.
Over the past several months, I've been critical of venture capitalists who believe over-regulation has prevented some of their portfolio companies from going public. In fact, I've characterized the so-called "IPO crisis" as imaginary.
But that debate ended yesterday, when the U.S. Senate passed the JOBS Act. The House of Reps is expected to vote on the amended bill next week, after which President MOREDan Primack - Mar 23, 2012 10:47 AM ET
Why the JOBS Act does, and doesn't, matter.
The Senate right now is debating the JOBS Act, with a full vote expected later this afternoon. Champions of the legislation, including a large number of venture capitalists, argue that it will increase capital access for emerging businesses. Critics believe it is a dangerous rollback of investor protections, including some put in place following the Enron and Worldcom accounting scandals.
So who's right? From MOREDan Primack - Mar 22, 2012 12:44 PM ET
Private equity stands to lose big from Obama's corporate tax overhaul.
President Obama yesterday unveiled plans to reform the corporate tax code, including an item that strikes at the very heart of private equity. No, I'm not talking about taxes on carried interest, even though Obama did reiterate that they should be treated as ordinary income. Instead, this is about the deductibility of interest on corporate debt (i.e., the "L" in MOREDan Primack - Feb 23, 2012 11:01 AM ET
Chris Christie's blunt talk crosses the line.
New Jersey Gov. Chris Christie is tired of Warren Buffett's tax talk, telling CNN's Piers Morgan that the famed investor "should just write a check and shut up."
No Chris, he shouldn't. And someone in your position shouldn't be telling him to do so.
To be clear, this isn't about the merits or demerits of Buffett's preferred tax scheme. Or Christie's, for that matter. It's about an elected MOREDan Primack - Feb 22, 2012 12:34 PM ET
Don't expect bombshells in Romney's tax returns.
Mitt Romney tomorrow will release his 2010 and 2011 tax returns, after which folks like me will spend hours going through the details.
And I do mean hours (plural), because these returns will be hundreds of pages long. There's no short form when you're invested in dozens of private investment partnerships.
Here's what I'll be looking for:
Overall rate: Romney last week admitted that he pays closer MOREDan Primack - Jan 23, 2012 3:05 PM ET
Updated 1/23 Mitt Romney is running for president as a "job creator," based on his time as a venture capitalist and private equity investor at Bain Capital. Some of his rivals are beginning to accuse Romney of being more of a job destroyer, citing some of Bain's more troubled investments.
So we've decided to keep track of who is saying what about Romney's tenure at Bain, and about private equity in the MOREDan Primack - Dec 13, 2011 3:01 PM ET
It's human nature to want to be able to say, "I told you so" when a prediction you've made comes true. But there are times — including this one — that I wish I'd been wrong.
Back in August, I wrote a rage-filled screed about the fools, cowards and incompetents who brought our country to the brink of defaulting on its debts, averting total catastrophe by passing last-minute debt-ceiling legislation that MOREAllan Sloan, senior editor-at-large - Nov 10, 2011 6:09 AM ET
By Larry Doyle, contributor
I received a call yesterday from a reporter inquiring about my recent post Occupy Wall Street' Should 'Occupy Washington. Having had a number of previous discussions with this reporter, I welcomed her question as to what I thought the OWS movement should look to achieve or demand.
I prefaced my comments by stating that I hope civil unrest and random violence do not come from these demonstrations. America MOREOct 11, 2011 1:29 PM ET
Solyndra is the subject of another bogus political scandal.
While both politicos and pundits continue to ignore Solyndra's flawed business model, lots of attention is being given to the fact that some of Solyndra's investors are scheduled to be reimbursed before the federal government. Apparently this is scandalous, because one of the investors -- Argonaut Private Equity -- is affiliated with a major donor to President Obama.
For example, take a look MOREDan Primack - Sep 19, 2011 12:32 PM ET
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