How Ronald Reagan Tried to Shrink Government Spending (Novemer 2024)
www.history.com

... In 1982, President Reagan appointed private sector experts to hunt for wastefulness and inefficiencies. They were met with limited success.

... Funded exclusively by $76 million in private-sector contributions, the "Grace Commission" was tasked with identifying opportunities for increased efficiencies and cost reductions through executive action or legislation, suggesting managerial operating improvements and determining areas for improved administrative controls.

More than 160 CEOs and senior corporate leaders chaired 36 task forces that reviewed executive branch agencies or functions, and nearly 2,000 business executives"and no federal employees"staffed the commission.

Reagan directed the commission to apply modern business practices to improve the efficiency and effectiveness of federal agencies. "Be bold," Reagan urged the Grace Commission. "We want your team to work like tireless bloodhounds. Don't leave any stone unturned in your search to root out inefficiency,"
The Grace Commission's Findings

For 18 months, the commission hunted for wastefulness and inefficiencies before issuing its formal findings on January 16, 1984. In a report that filled 47 volumes and 23,000 pages, the commission made 2,478 cost-cutting and revenue-enhancing recommendations that it estimated would result in $424 billion in savings over three years.

"The federal government is suffering from a critical case of inefficient and ineffective management, evidenced particularly by the hemorrhaging of billions of tax dollars and mounting deficits," the report stated.

While scandalous examples of profligate spending by the Department of Defense, such as $436 for a claw hammer and $511 for a 60-cent light bulb, grabbed headlines, the commission pinpointed more mundane, but fruitful, targets.

It flagged the Federal Power Marketing Administration for selling subsidized power in the Northwest at one-third of market rates and recommended that cash seized by the Justice Department be placed in interest-earning bank accounts.

It found the Treasury Department could save $1.3 billion over three years by paying bills when they were due instead of when they were received and estimated that individuals and corporations failed to pay $81.5 billion in taxes in 1981. ...