Running Government Like a Corporation

Susan B. Glasser’s and Michael Grunwald’s Washington Post article about the ongoing comedy of errors that is the Department of Homeland Securityis a fun read. Did you know that the DHS has its own official typeface? It also has an official color scheme (cool gray, red and hints of “punched-up” blue), a nifty focus-group-tested seal and lapel pins for every employee.

What is doesn’t have is focus, organization, or a clue.

Here’s a quickie history: You may remember that President Bush was against formation of a DHS before he was for it. There had been talk of a DHS before September 11. The Hart-Rudman commission, which issued a final report in January 2001 (the WaPo article says May, but it was January), recommended a cabinet-level DHS and several other reforms that Bush and Cheney, upon ascending to office, promptly kneecapped. After 9/11 Bush had announced creation of an Office of Homeland Security, headed by Tom Ridge, who would work out of the West Wing and report only to the President. As far as Bush was concerned, the biggest argument in favor of this arrangement was that as a presidential aide Ridge was not required to testify to Congress. For this reason, Bush resisted suggestions that Ridge’s position be cabinet level.

But Democrats in Congress were pushing for a Department of Homeland Security instead of an Office. “On Capitol Hill, lawmakers in both parties were upset by Bush’s refusal to let Ridge testify as a presidential aide,” write Glasser and Grunwald. “and Lieberman’s bill to create a new department was gaining momentum. While many Republicans were leery about a vast new bureaucracy, they did not want to cede the homeland security issue to the Democrats.” So early in 2002, even as Bush and Capitol Hill Republicans continued to speak out against formation of the department, White House staffers began to plot the president’s reversal. Glasser and Grunwald:

In the White House bunker where Cheney had waited out the Sept. 11 attacks, a select group of policy aides had been secretly commissioned to plot the administration’s about-face.

They were called together in April by White House Chief of Staff Andrew H. Card Jr. — five mid-level staffers known as the “Gang of Five,” or as they liked to call themselves, the “G-5.” Two worked for Ridge — Lawlor and Richard A. Falkenrath, a security expert from Harvard — and Card sent his deputy Joel D. Kaplan, associate counsel Brad Berenson and deputy budget director Mark W. Everson.

As near as I can determine, none of these people had any hands-on experience working in the bureaucracies they were meeting to overhaul. Indeed, they didn’t seem to have a whole lot of experience working in any big bureaucracy.

Several times a week, the G-5 met with a group of principals, including Card, Ridge, national security adviser Condoleezza Rice, budget director Mitchell E. Daniels Jr. and Cheney Chief of Staff I. Lewis “Scooter” Libby. On poster boards, they listed all the agencies that might make sense in the department. “The overriding guidance,” Lawlor recalled, “was that everything was on the table for consideration.”

This anecdote nicely illustrates the expertise and professionalism of the DHS crew:

Some of the decisions were almost random. Falkenrath thought it would be nice to give the new department a research lab that could bring cutting-edge research to homeland security problems. He called up a friend and asked which of the three Department of Energy labs would work. “He goes, ‘Livermore.’ And I’m like, ‘All right. See you later.’ Click,” Falkenrath told historians from the Naval Postgraduate School. He did not realize that he had just decided to give the new department a thermonuclear weapon simulator, among other highly sensitive assets of the Lawrence Livermore National Laboratory.

In June of 2002 Bush announced the formation of DHS. The White House crew had been working on the plan for all of six months.

On Capitol Hill, Bush’s allies were left tongue-tied by his abrupt shift. In late May the White House had pushed Republicans on the Senate Governmental Affairs Committee to oppose Lieberman’s bill. Now, Sen. Fred D. Thompson (R-Tenn.) told Lieberman: “I’ve been having a great time explaining my enthusiastic support for a proposition I voted against two weeks ago.”

The next step was all Karl Rove. Harold Meyerson wrote in WaPo (September 21, 2005),

In the fall of 2002, as the legislation establishing the DHS was wending its way through Congress, Rove had a Rovean idea: Embed some extraneous, ideological criteria in the bill — criteria that the Democrats would obviously oppose — and then campaign against those Democrats for being soft on homeland security. Which is why one day the bill suddenly contained language mandating that the unionized federal employees at the agencies being merged into DHS would henceforth be non-union. Predictably, the Democrats squawked, and predictably, the Republicans took out after a southern Democratic senator up for reelection — Georgia’s Max Cleland, who’d lost an arm and both legs while fighting in Vietnam — as indifferent to protecting our nation. Cleland was defeated.

To this day, Bush likes to speechify that Democrats had been opposed to DHS, implying that they are “weak” on homeland security, leaving out the detail that DHS had been primarily their idea to begin with.

But let’s continue — once the plan was made public, the amateurs who had drawn up the plans began to hear from the professionals that it wouldn’t work.

Falkenrath was barraged by Hill staffers with questions he could not answer: If the Immigration and Naturalization Service was moving to the new department, why were immigration judges staying at the Justice Department? Falkenrath did not know there were immigration judges. “Every one of these staffers had some little angle on something that we hadn’t thought of,” he said. “I was like, ‘We better go figure out what we’ve missed here.’ ”

Inside the White House, some aides were appalled by the specter of “a group of people who really didn’t know a whole lot about the boxes they were moving around,” as one put it. White House cybersecurity czar Richard A. Clarke, the counterterrorism chief sidelined by Bush after urging more decisive action against al Qaeda before Sept. 11, blasted Ridge’s office with a memo about the new department’s design flaws, warning that the failure to include a policy office would leave the secretary helpless to control its independent fiefdoms.

“Creating a significant policy shop is like Bureaucracy 101,” said Clarke deputy Roger Cressey. “We never heard anything back.”

And, as the DHS prepared to go into operation, political considerations continued to trump security considerations.

One stark example was the White House’s blockade of a Ridge-supported plan to secure large chemical plants. After Sept. 11, Whitman had worked with Ridge on a modest effort to require high-risk plants — especially the 123 factories where a toxic release could endanger at least 1 million people — to enhance security. But industry groups warned Bush political adviser Karl Rove that giving new regulatory power to the Environmental Protection Agency would be a disaster.

“We have a similar set of concerns,” Rove wrote to the president of BP Amoco Chemical Co.

In an interagency meeting shortly before DHS’s birth, White House budget official Philip J. Perry, who also happens to be Cheney’s son-in-law, declared the Ridge-Whitman plan dead.

The White House continued to undermine the DHS.

On Jan. 24, 2003, Ridge was sworn in as the first secretary of homeland security; Bush hailed him as a “superb leader who has my confidence.” Four days later, Ridge learned from the president’s State of the Union address that a new intelligence center for tracking terrorists — which he had expected to be the hub of DHS’s dot-connecting efforts — would not be controlled by DHS.

Ridge and his aides thought the center was one of the key reasons the department had been created, to prevent the coordination failures that helped produce Sept. 11. Not only had the White House undercut Ridge, it also let him find out about his defeat on television.

Bush didn’t even want the new Department to have its offices in Washington.

The first battle over DHS came when the White House tried to exile it from Washington. Initially, Daniels proposed to let cities around the country bid to host the new department as a cost-saving measure. Then the White House tried to park DHS outside the Beltway in Chantilly.

Just before the department’s official March 1 start date, the Chantilly deal fell through and DHS ended up in a decrepit Navy complex on Nebraska Avenue in Upper Northwest, several miles from the rest of federal Washington. Top DHS officials had to share desks in a “gulag-like” hangar at Building 3; the White House initially told them it was temporary quarters until a new “campus” was commissioned. But the talk of a new home for the department quickly stopped.

While everybody seems to think Tom Ridge is a lovely man, he lacked the mangerial skill to pull the behemouth of a department together. But he tried hard to pull together a regional plan for DHS.

From his first day at DHS, Ridge pushed to create what he called “mini-me’s,” eight regional directors who would manage the department’s assets in their areas during a crisis. It was Ridge’s one major effort to put his own organizational stamp on DHS, and it was meant to ensure better preparedness for a disaster, the thinking being that “you can’t plan a response in Los Angeles out of Washington, D.C.,” Lawlor said. With hurricanes in mind, Ridge wanted one region to have headquarters in New Orleans.

Some of DHS’s own managers, including Michael Brown of FEMA, complained about this idea. Brown actually went over Ridge’s head and complained to the White House. The White House would eventually kill the plan.

Tom Ridge resigned at the end of Bush’s first term, and Michael Chertoff took his place. And the rest is, well, Katrina. Glasser and Grunwald promise another installment of this saga tomorrow — FEMA’s war on DHS.

Update: I ought to explain the title — I started to write about the fact that DHS reminds me of corporations I used to work for — all slick PR, but total chaos beneath the surface. But the corporations had the benefit of enough long-term employees who knew the ropes that the companies were able to stumble along in spite of gross mismanagement.

6 thoughts on “Running Government Like a Corporation

  1. I have worked for the Federal Government for 30 years and know for a fact that you cannot run a Federal Government Agency like a corporation. Of course, there might have been a modicum of success had any of these idiots known anything other than politics. You have to remove the politics from the Federal Government or nothing will work–as is being displayed now. That was the whole point of the Civil Service Reform Act.

    And, if you are running a coporation, the last thing any smart CEO is going to do is cut its financial base (taxes). In fact, the whole purpose of any corporation is to increase its financial base. Thus, you cannot improve the Federal Government without money. But, then, we all know that the Republicans have never wanted any thing other than the death of the Federal Government. Boy, have these guys screwed up this country.

  2. Never underestimate the power and value of institutional memory. That’s my primary rule of organizations these days, after years of watching restructurings in small and large outfits.

  3. I always thought that the name “Department of Homeland Security“had an animal farm Orwellian ring to it that was more appropriate for Nazi Germany than a great democracy like the USA. I have worked as a manager in both the Canadian Federal government and the Province of Ontario for 22 years in the area of social policy and service delivery and have seen a lot of changes. I have also worked on a few major business transformation projects. When it comes to government big is never better! Canada learned that the hard way years ago. I predict the whole (DHS) thing will finally collapse under it own weight and will be quietly restructured into more manageable parts. Most likely either after the chief dunce gets sent packing back to Crawford on a permanent vacation or after another Kratina/911 type disaster that gets fumbled yet again.

  4. I have said for years that most businesses don’t thrive because of good management, they survive despite bad management. General Motors is the current good example.

    Bush led several companies in the private sector that were abysmal failures. Now he thinks that he is still a CEO and he is a gross failure.

  5. “Never underestimate the power and value of institutional memory. That’s my primary rule of organizations these days, after years of watching restructurings in small and large outfits.”

    I’m with you. Unfortunately your average CEO never worked in the trenches and doesn’t get it.

  6. I was present at the creation of the Department of Energy, my first job after dropping out of college. Xerox operator… a skilled, responsible position 🙂

    When I went to work, it was the Federal Energy Office (FEO), then the Federal Energy Administration (FEA), back to FEO (budget cuts)), FEA (cuts restored), and Department of Energy! Went thru 5 or six offices in as many buildings, helped set up (literally) the first “cube farm,” never knew from one day to the next who or where I shoould report. A true zoo!

    As I read the Post series, I can see all this and more in my mind. There is NO chance this will work within the next decade, I promise you.

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