Event Information

Cloud computing services over the Internet have the potential to spur a significant increase in government efficiency and decrease technology costs, as well as to create incentives and online platforms for innovation. Adoption of cloud computing technologies could lead to new, efficient ways of governing.

On April 7, the Brookings Institution hosted a policy forum that examines the economic benefits of cloud computing for local, state, and federal government. Federal Chief Information Officer Vivek Kundra delivered a keynote address on the role of the government in developing and promoting cloud computing. Brookings Vice President Darrell West moderated a panel of experts and detailed the findings in his paper, "Saving Money through Cloud Computing," which analyzes its governmental cost-savings potential.

After the program, panelists took audience questions.

Video

• Cloud Computing a Fiscally Smart Move
• Cloud Computing Saves Money, Makes Government More Open
• Cloud Computing Will Fundamentally Change Government Operations
• Government on Cloud Will Yield Cost-Effective System

Audio

• The Economic Gains of Cloud Computing

Transcript

• Uncorrected Transcript (.pdf)

Event Materials

• 20100407_cloud_computing
• 0407_cloud_computing_kundra_remarks
• 0407_cloud_computing_kundra_presentation

The appointment of new federal chief information officer Steven VanRoekel comes at a challenging time for President Barack Obama. The national economy continues to be weak. Congress plans to cut trillions from the federal budget. And in the time leading up to the 2012 election, American voters remain cynical about the ability of the government to address important policy problems in an effective manner.

In an era of deficit reduction and public cynicism, the tasks facing federal officials are to determine how to do more with less and persuade voters the government can become smarter and more effective. There are going to be fewer dollars for virtually every federal program so it is important to figure how ways to innovate and perform more efficiently.

Former CIO Vivek Kundra sought to do this through encouraging agencies to move software applications to the cloud, consolidating federal data centers, improving transparency, and improving the information technology procurement process. It is important to continue this progress even as agencies are forced to downsize their operations.

As shown in the private sector, government administrators should use technology to cut costs, improve worker productivity, and streamline operations. This is not just a matter of using technology in more innovative ways, but changing the operations and culture of the public sector. Public officials must improve its data mining activities to identify fraud and abuse in Medicare, Medicaid, the Defense Department, and other domestic programs.

New software gives managers better tools to evaluate how money is being spent and whether it is fulfilling intended goals. If it is not, programs need to be modified or eliminated. The most important weapon in Mr. VanRoekel’s arsenal may be the scalpel as he goes through the federal government’s $80 billion IT budget.

Led by presidential candidate Bernie Sanders, one-time supporters of ‘single-payer’ health reform are rekindling their romance with a health reform idea that was, is, and will remain a dream.  Single-payer health reform is a dream because, as the old joke goes, ‘you can’t get there from here.

Let’s be clear: opposing a proposal only because one believes it cannot be passed is usually a dodge.One should judge the merits. Strong leaders prove their skill by persuading people to embrace their visions. But single-payer is different. It is radical in a way that no legislation has ever been in the United States.

Not so, you may be thinking. Remember such transformative laws as the Social Security Act, Medicare, the Homestead Act, and the Interstate Highway Act. And, yes, remember the Affordable Care Act. Those and many other inspired legislative acts seemed revolutionary enough at the time. But none really was. None overturned entrenched and valued contractual and legislative arrangements. None reshuffled trillions—or in less inflated days, billions—of dollars devoted to the same general purpose as the new legislation. All either extended services previously available to only a few, or created wholly new arrangements.

To understand the difference between those past achievements and the idea of replacing current health insurance arrangements with a single-payer system, compare the Affordable Care Act with Sanders’ single-payer proposal.

Criticized by some for alleged radicalism, the ACA is actually stunningly incremental. Most of the ACA’s expanded coverage comes through extension of Medicaid, an existing public program that serves more than 60 million people. The rest comes through purchase of private insurance in “exchanges,” which embody the conservative ideal of a market that promotes competition among private venders, or through regulations that extended the ability of adult offspring to remain covered under parental plans. The ACA minimally altered insurance coverage for the 170 million people covered through employment-based health insurance. The ACA added a few small benefits to Medicare but left it otherwise untouched. It left unaltered the tax breaks that support group insurance coverage for most working age Americans and their families. It also left alone the military health programs serving 14 million people. Private nonprofit and for-profit hospitals, other vendors, and privately employed professionals continue to deliver most care.

In contrast, Senator Sanders’ plan, like the earlier proposal sponsored by Representative John Conyers (D-Michigan) which Sanders co-sponsored, would scrap all of those arrangements. Instead, people would simply go to the medical care provider of their choice and bills would be paid from a national trust fund. That sounds simple and attractive, but it raises vexatious questions.

• How much would it cost the federal government? Where would the money to cover the costs come from?
• What would happen to the $700 billion that employers now spend on health insurance?
• How would the $600 billion a year reductions in total health spending that Sanders says his plan would generate come from?
• What would happen to special facilities for veterans and families of members of the armed services?

Sanders has answers for some of these questions, but not for others. Both the answers and non-answers show why single payer is unlike past major social legislation.

The answer to the question of how much single payer would cost the federal government is simple: $4.1 trillion a year, or $1.4 trillion more than the federal government now spends on programs that the Sanders plan would replace. The money would come from new taxes. Half the added revenue would come from doubling the payroll tax that employers now pay for Social Security. This tax approximates what employers now collectively spend on health insurance for their employees...if they provide health insurance. But many don’t. Some employers would face large tax increases. Others would reap windfall gains.

The cost question is particularly knotty, as Sanders assumes a 20 percent cut in spending averaged over ten years, even as roughly 30 million currently uninsured people would gain coverage. Those savings, even if actually realized, would start slowly, which means cuts of 30 percent or more by Year 10. Where would they come from? Savings from reduced red-tape associated with individual insurance would cover a small fraction of this target. The major source would have to be fewer services or reduced prices. Who would determine which of the services physicians regard as desirable -- and patients have come to expect -- are no longer ‘needed’? How would those be achieved without massive bankruptcies among hospitals, as columnist Ezra Klein has suggested, and would follow such spending cuts? What would be the reaction to the prospect of drastic cuts in salaries of health care personnel – would we have a shortage of doctors and nurses? Would patients tolerate a reduction in services? If people thought that services under the Sanders plan were inadequate, would they be allowed to ‘top up’ with private insurance? If so, what happens to simplicity? If not, why not?

Let me be clear: we know that high quality health care can be delivered at much lower cost than is the U.S. norm. We know because other countries do it. In fact, some of them have plans not unlike the one Senator Sanders is proposing. We know that single-payer mechanisms work in some countries. But those systems evolved over decades, based on gradual and incremental change from what existed before. That is the way that public policy is made in democracies. Radical change may occur after a catastrophic economic collapse or a major war. But in normal times, democracies do not tolerate radical discontinuity. If you doubt me, consider the tumult precipitated by the really quite conservative Affordable Care Act.

Editor's note: This piece originally appeared in Newsweek.

Health reform (aka Obamacare) is entering a new stage. The recent announcement by United Health Care that it will stop selling insurance to individuals and families through most health insurance exchanges marks the transition. In the next stage, federal and state policy makers must decide how to use broad regulatory powers they have under the Affordable Care Act (ACA) to stabilize, expand, and diversify risk pools, improve local market competition, encourage insurers to compete on product quality rather than premium alone, and promote effective risk management. In addition, insurance companies must master rate setting, plan design, and network management and effectively manage the health risk of their enrollees in order to stay profitable, and consumers must learn how to choose and use the best plan for their circumstances.

Six months ago, United Health Care (UHC) announced that it was thinking about pulling out of the ACA exchanges. Now, they are pulling out of all but a “handful” of marketplaces. UHC is the largest private vendor of health insurance in the nation. Nonetheless, the impact on people who buy insurance through the ACA exchanges will be modest, according to careful analyses from the Kaiser Family Foundation and the Urban Institute. The effect is modest for three reasons. One is that in some states UHC focuses on group insurance, not on insurance sold to individuals, where they are not always a major presence. Secondly, premiums of UHC products in individual markets are relatively high. Third, in most states and counties ACA purchasers will still have a choice of two or more other options. In addition, UHC’s departure may coincide with or actually cause the entry of other insurers, as seems to be happening in Iowa.

The announcement by UHC is noteworthy, however. It signals the beginning for ACA exchanges of a new stage in their development, with challenges and opportunities different from and in many ways more important than those they faced during the first three years of operation, when the challenge was just to get up and running. From the time when HealthCare.Gov and the various state exchanges opened their doors until now, administrators grappled non-stop with administrative challenges—how to enroll people, helping them make an informed choice among insurance offerings, computing the right amount of assistance each individual or family should receive, modifying plans when income or family circumstances change, and performing various ‘back office’ tasks such as transferring data to and from insurance companies. The chaotic first weeks after the exchanges opened on October 1, 2013 have been well documented, not least by critics of the ACA. Less well known are the countless behind-the-scenes crises, patches, and work-arounds that harried exchange administrators used for years afterwards to keep the exchanges open and functioning.

The ACA forced not just exchange administrators but also insurers to cope with a new system and with new enrollees. Many new exchange customers were uninsured prior to signing up for marketplace coverage. Insurers had little or no information on what their use of health care would be. That meant that insurers could not be sure where to set premiums or how aggressively to try to control costs, for example by limiting networks of physicians and hospitals enrollees could use. Some did the job well or got lucky. Some didn’t. United seems to have fallen in the second category. United could have stayed in the 30 or so state markets they are leaving and tried to figure out ways to compete more effectively, but since their marketplace premiums were often not competitive and most of their business was with large groups, management decided to focus on that highly profitable segment of the insurance market. Some insurers, are seeking sizeable premium increases for insurance year 2017, in part because of unexpectedly high usage of health care by new exchange enrollees.

United is not alone in having a rough time in the exchanges. So did most of the cooperative plans that were set up under the ACA. Of the 23 cooperative plans that were established, more than half have gone out of business and more may follow. These developments do not signal the end of the ACA or even indicate a crisis. They do mark the end of an initial period when exchanges were learning how best to cope with clerical challenges posed by a quite complicated law and when insurance companies were breaking into new markets. In the next phase of ACA implementation, federal and state policy makers will face different challenges: how to stabilize, expand, and diversify marketplace risk pools, promote local market competition, and encourage insurers to compete on product quality rather than premium alone. Insurance company executives will have to figure out how to master rate setting, plan design, and network management and manage risk for customers with different characteristics than those to which they have become accustomed.

Achieving these goals will require state and federal authorities to go beyond the core implementation decisions that have absorbed most of their attention to date and exercise powers the ACA gives them. For example, section 1332 of the ACA authorizes states to apply for waivers starting in 2017 under which they can seek to achieve the goals of the 2010 law in ways different from those specified in the original legislation. Along quite different lines, efforts are already underway in many state-based marketplaces, such as the District of Columbia, to expand and diversify the individual market risk pool by expanding marketing efforts to enroll new consumers, especially young adults. Minnesota’s Health Care Task Force recently recommended options to stabilize marketplace premiums, including reinsurance, maximum limits on the excess capital reserves or surpluses of health plans, and the merger of individual and small group markets, as Massachusetts and Vermont have done.

In normal markets, prices must cover costs, and while some companies prosper, some do not. In that respect, ACA markets are quite normal. Some regional and national insurers, along with a number of new entrants, have experienced losses in their marketplace business in 2016. One reason seems to be that insurers priced their plans aggressively in 2014 and 2015 to gain customers and then held steady in 2016. Now, many are proposing significant premium hikes for 2017.

Others, like United, are withdrawing from some states. ACA exchange administrators and state insurance officials must now take steps to encourage continued or new insurer participation, including by new entrants such as Medicaid managed care organizations (MCOs). For example, in New Mexico, where in 2016 Blue Cross Blue Shield withdrew from the state exchange, state officials now need to work with that insurer to ensure a smooth transition as it re-enters the New Mexico marketplace and to encourage other insurers to join it. In addition, state insurance regulators can use their rate review authority to benefit enrollees by promoting fair and competitive pricing among marketplace insurers. During the rate review process, which sometimes evolves into a bargaining process, insurance regulators often have the ability to put downward pressure on rates, although they must be careful to avoid the risk of underpricing of marketplace plans which could compromise the financial viability of insurers and cause them to withdraw from the market. Exchanges have an important role in the affordability of marketplace plans too. For example ACA marketplace officials in the District of Columbia and Connecticut work closely with state regulators during the rate review process in an effort to keep rates affordable and adequate to assure insurers a fair rate of return.

Several studies now indicate that in selecting among health insurance plans people tend to give disproportionate weight to premium price, and insufficient attention to other cost provisions—deductibles and cost sharing—and to quality of service and care. A core objective of the ACA is to encourage insurance customers to evaluate plans comprehensively. This objective will be hard to achieve, as health insurance is perhaps the most complicated product most people buy. But it will be next to impossible unless customers have tools that help them take account of the cost implications of all plan features and report accurately and understandably on plan quality and service. HealthCare.gov and state-based marketplaces, to varying degrees, are already offering consumers access to a number of decision support tools, such as total cost calculators, integrated provider directories, and formulary look-ups, along with tools that indicate provider network size. These should be refined over time. In addition, efforts are now underway at the federal and state level to provide more data to consumers so that they can make quality-driven plan choices. In 2018, the marketplaces will be required to display federally developed quality ratings and enrollee satisfaction information. The District of Columbia is examining the possibility of adding additional measures. California has proposed that starting in 2018 plans may only contract with providers and hospitals that have met state-specified metrics of quality care and promote safety of enrollees at a reasonable price. Such efforts will proliferate, even if not all succeed.

Beyond regulatory efforts noted above, insurance companies themselves have a critical role to play in contributing to the continued success of the ACA. As insurers come to understand the risk profiles of marketplace enrollees, they will be better able to set rates, design plans, and manage networks and thereby stay profitable. In addition, insurers are best positioned to maintain the stability of their individual market risk pools by developing and financing marketing plans to increase the volume and diversity of their exchange enrollments. It is important, in addition, that insurers, such as UHC, stop creaming off good risks from the ACA marketplaces by marketing limited coverage insurance products, such as dread disease policies and short term plans. If they do not do so voluntarily, state insurance regulators and the exchanges should join in stopping them from doing so.

Most of the attention paid to the ACA to date has focused on efforts to extend health coverage to the previously uninsured and to the administrative stumbles associated with that effort. While insurance coverage will broaden further, the period of rapid growth in coverage is at an end. And while administrative challenges remain, the basics are now in place. Now, the exchanges face the hard work of promoting vigorous and sustainable competition among insurers and of providing their customers with information so that insurers compete on what matters: cost, service, and quality of health care.

Editor's note: This piece originally appeared in Real Clear Markets. Kevin Lucia and Justin Giovannelli contributed to this article with generous support from The Commonwealth Fund.

Latin America is starting off 2015 with a clear economic slowdown. The United Nations Economic Commission for Latin America and the Caribbean (ECLAC) projects a modest recovery (2.2 per cent) with respect to last year (in 2014 growth was only 1.1 per cent, the lowest since the 2009 crisis), though these calculations may vary due to several factors.

The world economy is not helping. The downward trend in raw materials prices, scant dynamism in global demand, and the appreciation of the dollar are three factors that work against the region today.

Venezuela and Argentina, are facing very complex economic contexts. Venezuela is in the midst of stagflation (aggravated by plummeting oil prices); and Argentina is experiencing negative growth, high inflation, and the unresolved conflict with the “vulture funds.”

The two largest economies of the region, Brazil and Mexico, are facing their own demons. Brazil President Dilma Rousseff, with a weak mandate, is gambling the political capital of her second term (which just began on 1 January) on the new economic team led by Joaquim “Scissorhands” Levy. Levy is to make a fiscal adjustment that has been put off and is much needed; Rousseff hopes it will enable her to regain investor confidence, and thereby return to higher growth. The Petrobras scandal (in addition to the negative impact it has been having within the Workers Party) requires that she wage a head-on struggle against corruption and impunity (she just proposed a national anticorruption campaign), and that she implement a thoroughgoing political reform, which has been put off for too long.

In Mexico, falling oil prices, economic growth below official expectations, and the wave of protests in the wake of the murders of the 43 students in school to become teachers at Ayotzinapa, have eclipsed the so-called Mexico moment and have Enrique Peña Nieto against the ropes. He has sought to retake the initiative by announcing new reforms and proposals, and he hopes to recover citizen trust if the structural reforms yield the results promised.

The challenge of the polls

In the 2015 electoral agenda, of special note are three presidential elections (Argentina, Guatemala, and Haiti), three legislative elections (El Salvador, Mexico, and Venezuela), and several state, regional, and municipal elections, in Bolivia, El Salvador, Colombia, Mexico, Paraguay, and Uruguay, among others.

The three presidential elections continue to be very open races. In Guatemala (from the return of democracy to date) the party in power has never been returned to office. The three best-positioned presidential candidates are the government party candidate Alejandro Sinibaldi, and opposition candidates Manuel Baldizón (for now he’s leading the polls) and former first lady Sandra Torres.

In Argentina, kirchnerismo is pulling into the election period worn down and without any clear candidate for now. The three leading candidates based on polling data are Peronists Daniel Scioli (former vice president of Néstor Kirchner and current governor of the province of Buenos Aires) and Sergio Massa (former chief of staff of Cristina Fernández de Kirchner, currently a federal legislator and opponent of the government), and on the center-right Mauricio Macri (current head of government of the city of Buenos Aires).

In Haiti, in a tense political environment, it is not clear who will succeed President Michel Martelly, or what the exact date will be for municipal, legislative, or presidential elections. It is rumored that presidential elections may be held in January 2016. Ultimately the electoral calendar will depend on how negotiations proceed between Martelly and the opposition.

The Salvadoran legislative and municipal elections are especially important. The Sánchez Cerén administration will seek to revalidate its triumph of early 2014, ensuring good legislative and municipal support for his efforts with a view to the next three years, while the Alianza Republicana Nacionalista (ARENA) will seek to turn things around at the polls.

In Mexico, the future of the administration of President Peña Nieto, beset by protests and scandals, turns on the midterm elections of June 2015. Whether Peña Nieto will have sufficient political capital to continue giving impetus to his agenda of structural reforms (“Pacto por México”) during the remaining three years of his term will hinge on the results of these elections.

In Venezuela, the legislative elections will increase political tension and repression by the regime. The opposition has a golden opportunity to win back the legislative majority from the chavistas or President Chavez followers, taking advantage of the profound economic crisis looming over the country and the fall in Nicolás Maduro’s popularity in the polls. The big question is whether the opposition will prove capable of taking advantage of this opportunity and whether the elections will be truly free and competitive. The other aspect to monitor is whether Vatican diplomacy, under the leadership of Pope Francis (and with the precedent of the re-establishment of relations between the United States and Cuba in his favor), will be able to facilitate an effective political dialogue between the government and the opposition to seek a negotiated solution to Venezuela’s complex situation.

Colombia, Cuba and Chile

In Colombia, in addition to the regional elections (in which the uribistas, or followers of former President Álvaro Uribe, will seek to come out on top this time), attention is focused on the final phase of the negotiations in Havana between the Revolutionary Armed Forces of Colombia (FARC) and the government of Juan Manuel Santos aimed at achieving peace. If the negotiations are successful, it will no doubt be the most important political event in the region in 2015. The fate of the peace process will be subject to a referendum, which will probably be held in the second half of 2015 or early 2016 (depending on the speed at which the negotiations proceed and their success).

The most important political event of 2014--the re-establishment of diplomatic relations between the United States and Cuba after more than 50 years of confrontation--will continue to capture considerable attention in 2015. This decision, which entails a 180-degree turnabout in U.S. policy to Cuba, will help improve relations between the United States and the region. It enables Cuba to fully assume its place in the hemisphere (its participation at the Seventh Summit of the Americas next April in Panama will make it a historic occasion), and at the same time it will also be able to diversify its trade relations and allow for new investment at a time when Venezuela (its main partner in recent years) is experiencing its own profound economic crisis. Full normalization of relations between the United States and Cuba (including the end of the embargo, a decision in the hands of Congress) will be a long and complex process, but the first step has already been taken, and in the right direction. In 2015 it will also be important to monitor the evolution and results of the economic reforms that Raúl Castro has been carrying out.

In addition, 2015 is a vital year in Chile for the government of Michelle Bachelet who, with markedly diminished popularity and mounting criticism of her presidency, must address two major challenges in the second year of her administration: bringing about the recovery of an economy that has clearly slowed down (1.7 per cent during 2014), and continuing to give impetus to an ambitious agenda of reforms.

This year the polemical education reform should be approved; it not only enjoys the backing of the opposition, but also provokes major tensions within the government coalition. In addition, the electoral reform should be unveiled (it will do away with the binomial system) and the labour reform, which is resulting in a new distancing of business from the government. Another point on the agenda is starting up the process aimed at amending the Constitution (one of Bachelet’s three main pledges during her campaign); the process promises to be the “mother of all reforms.”

Different scenarios in regional relations

In regional relations, seven events stand out for their importance and should be closely monitored:

1. The first ministerial meeting of China-Comunidad de Estados Latinoamericanos y Caribeños CELAC Forum in Beijing, China (January 8 and 9);
2. The third meeting of CELAC in Costa Rica (January 28 and 29), where Ecuador will assume the presidency;
3. The Seventh Summit of the Americas, which will take place in Panama (April 10 and 11), and whose focus of attention will be Cuba’s participation for the first time since the Summits process began in 1994;
4. The election of a new Secretary General of the Organization of American States (OAS) with the capacity to strategically reposition this weakened regional organization affected by the political divisions among its member countries;
5. The evolution of the process of rapprochement between MERCOSUR and the Pacific Alliance;
6. The EU-Latin America Summit;
7. The recent re-launch of UNASUR (which took place in December in Quito), under the leadership of former President Ernesto Samper.

My opinion

Latin America finds itself in the doldrums, and must undertake a two-fold transition: from the model based on high raw materials prices and low financing costs, to one with low raw materials prices and higher financing costs. As the OECD rightly notes: “this abrupt economic slowdown is not a passing phenomenon, it has come to stay. It’s the end of a cycle.”

This requires the region to urgently set in motion profound structural reforms, aimed at changing its development model which can strategically adapt to this new global context.

Only by improving productivity and competitiveness, education and innovation, infrastructure, but also the quality of its institutions, will the region be able to achieve inclusive, equitable, and sustainable economic growth that makes it possible to continue reducing poverty and inequality. All this will enable the region to respond more effectively to the demands and expectations of citizens ever more aware and demanding of their rights and of quality public services.

This economic slowdown and the implementation of an agenda of structural reforms (including the structural adjustment policies that we’ll see in some countries) will surely affect certain interests, thereby paving the way for certain countries to suffer greater social discontent in 2015 and a more complex situation when it comes to governability.

Yet the region is not homogenous. On the contrary, there is a considerable degree of heterogeneity that will determine a wide diversity of national situations. In effect, while Central America grew 3.7 per cent in 2014, and will grow 4.1 per cent in 2015, in South America these percentages are 0.7 per cent and 1.8 per cent respectively. Yet there is also diversity among countries. Accordingly, for example, while Panama (7.0 per cent), Bolivia (5.5 per cent), Peru, Dominican Republic, and Nicaragua (5.0 per cent) head up the list of economies with the best prospects for growth. Countries such as Brazil and Argentina – with more capacity for traction than the rest of the economies – have much more moderate projections. Mexico and Chile, predicted to experience 3 per cent annual growth, could help push the regional average up. Venezuela, similar to 2014 (with negative growth and inflation at about 64 per cent), will have a very complicated year economically speaking.

As Warren Buffet said, and rightly so, “when the tide goes out you can see who's been skinny dipping.” Something similar will happen with the countries of the region in 2015. Soon we’ll know which governments have been financially exposed.

This piece was originally published by International IDEA.

Dear Members of the Senate,

As you know, the Senate has debated the merits of the filibuster and related procedural rules for over two centuries. Recently, several senators who are advocating changes to Senate Rule XXII have renewed this discussion. We write this letter today to clarify some of the common historical and constitutional misperceptions about the filibuster and Rule XXII that all too often surface during debates about Senate rules.

First, many argue that senators have a constitutional right to extended debate. However, there is no explicit constitutional right to filibuster.^[1] In fact, there is ample evidence that the framers preferred majority rather than supermajority voting rules. The framers knew full well the difficulties posed by supermajority rules, given their experiences in the Confederation Congress under the Articles of Confederation (which required a supermajority vote to pass measures on the most important matters). A common result was stalemate; legislators frequently found themselves unable to muster support from a supermajority of the states for essential matters of governing. In the Constitution, the framers specified that supermajority votes would be necessary in seven, extraordinary situations -which they specifically listed (including overriding a presidential veto, expelling a member of the Senate, and ratifying a treaty). These, of course, are all voting requirements for passing measures, rather than rules for bringing debate to a close.

Second, although historical lore says that the filibuster was part of the original design of the Senate, there is no empirical basis for that view. There is no question that the framers intended the Senate to be a deliberative body. But they sought to achieve that goal through structural features of the chamber intended to facilitate deliberation -such as the Senate's smaller size, longer and staggered terms, and older members. There is no historical evidence that the framers anticipated that the Senate would adopt rules allowing for a filibuster. In fact, the first House and the first Senate had nearly identical rule books, both of which included a motion to move the previous question. The House converted that rule into a simple majority cloture rule early in its history. The Senate did not.

What happened to the Senate's previous question motion? In 1805, as presiding officer of the Senate, Vice President Aaron Burr recommended a pruning of the Senate's rules. He singled out the previous question motion as unnecessary (keeping in mind that the rule had not yet routinely been used in either chamber as a simple majority cloture motion). When senators met in 1806 to re-codify the rules, they deleted the previous question motion from the Senate rulebook. Senators did so not because they sought to create the opportunity to filibuster; they abandoned the motion as a matter of procedural housekeeping. Deletion of the motion took away one of the possible avenues for cutting off debate by majority vote, but did not constitute a deliberate choice to allow obstruction. The first documented filibusters did not occur until the 1830s, and for the next century they were rare (but often effective) occurrences in a chamber in which majorities generally reigned.

Finally, the adoption of Rule XXII in 1917 did not reflect a broad-based Senate preference for a supermajority cloture rule. At that time, a substantial portion of the majority party favored a simple majority rule. But many minority party members preferred a supermajority cloture rule, while others preferred no cloture rule at all. A bargain was struck: Opponents of reform promised not to block the rule change and proponents of reform promised not to push for a simple majority cloture rule. The two-thirds threshold, in other words, was the product of bargaining and compromise with the minority. As has been typical of the Senate's past episodes of procedural change, pragmatic politics largely shaped reform of the Senate's rules.

We hope this historical perspective on the origins of the filibuster and Rule XXII will be helpful to you as matters of reform are raised and debated. Please do not hesitate to contact us if we can provide additional clarification.

Very truly yours,

Sarah Binder
Senior Fellow, Governance Studies, The Brookings Institution
Professor of Political Science, George Washington University

Gregory Koger
Associate Professor of Political Science, University of Miami

Thomas E. Mann
W. Averell Harriman Chair & Senior Fellow, Governance Studies, The Brookings Institution

Norman Ornstein
Resident Scholar, American Enterprise Institute for Public Policy Research

Eric Schickler
Jeffrey & Ashley McDermott Endowed Chair & Professor of Political Science, University of California, Berkeley

Barbara Sinclair
Marvin Hoffenberg Professor of American Politics Emerita, University of California, Los Angeles

Steven S. Smith
Kate M. Gregg Distinguished Professor of Social Sciences & Professor of Political Science, Washington University

Gregory J. Wawro
Deputy Chair & Associate Professor of Political Science, Columbia University

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"We are now locked in a rolling filibuster on every issue, which is totally gridlocking the U.S. Senate. That is wrong. It is wrong for America."

Who said that? Democrat Harry Reid, majority leader of the Senate? Guess again. Try former Republican leader Trent Lott, bemoaning the troubled state of the Senate in the late 1990s.

No recent majority leader of either party has been saved the headache of trying to lead a Senate in which minorities can exploit the rules and stymie the chamber. This is not a new problem. Harry Reid may face a particularly unrestrained minority. But generations of Senate leaders from Henry Clay to Bill Frist have felt compelled to seek changes in Senate rules to make the chamber a more governable place.

Some things never change.

Twice this week, the Senate has opened debate with its party leaders engaged in a caustic battle over Reid's plans to seek changes to Senate rules in January.

Read the full piece at CNN.com »

As the clock runs out on the dysfunctional 112th Congress, few have been impressed by its paltry record and balky performance. But pardon my glee: December has been a great month for students of Congress. First, the House leadership was handed a blistering defeat on its “Plan B” to resolve the fiscal cliff. Next, while their leaders were meeting to negotiate an 11th hour of the 12th month fiscal cliff deal, eight senators unveiled a bipartisan proposal to head off a Democratic threat to change the rules by majority vote. When it rains, it pours!

The reform package—addressing “talking filibusters” and filibusters on procedural motions – deserves a bit more attention. And it deserves an appropriate historical illustration: To the right, a 1928 Chicago Tribune cartoon that features not the talking filibuster…but a sleeping one. Seems that talking filibusters might have been few and far between even back then.

Ezra Klein and Jon Bernstein have detailed the proposed changes and weighed in here and here, as has Steve Smith by tweet here and here. Since then, a coalition of nearly fifty liberal groups has rejected the proposal out of hand as watered down reform. To these several perspectives on the McCain-Levin plan, I would add the following thoughts:

First, these are at best incremental reforms. The majority leader would essentially gain the right to set the Senate’s agenda by majority vote, as a four-hour debate limit would be imposed on the motion to proceed. But the majority leader would pay a price for that new power: He would lose his power to block amendments (by “filling the tree”) and the minority bill manager and leader would be newly guaranteed an amendment each upon consideration of a legislative measure. (The majority leader, it seems, might still be able to fill the tree after the guaranteed amendments are dispensed with.) This change leaves untouched the sixty-vote threshold for invoking cloture on the measure or other amendments, similar to the plans of Democratic reformers. In short, the change tries to address the grievances of both the majority (by circumventing filibusters of the motion to proceed) and the minority (by creating and guaranteeing amendment opportunities).

Second, the incremental nature of the reforms is not accidental. Ezra has a point when he argues that this is “filibuster reform for people who don’t want to reform the filibuster.” Still, the incremental nature of the proposal strikes me as the price of negotiating procedural change in a legislative body whose rules already advantage the minority party: The majority gets a little only by giving a little. The barrier to reform is entrenched in the Senate’s cloture rule, given the supermajority required for ending filibusters of proposals that curtail minority rights. A Senate majority could circumvent that barrier by going nuclear with 51 votes, but that strategy is not cost-free. To be sure, reformers claim to have 51 votes for a reform-by-ruling move. But it’s not clear to me yet that the majority would be willing to pay the accompanying costs of weathering the minority’s response to going nuclear.

Third, the rules address leaders’ interests more so than those of the rank and file. Some of the proposed changes are aimed at time management. For example, with the consent of the majority and minority leaders and a bipartisan handful of senators , the cloture process is sped up markedly. Similarly, the three debatable steps required to get to conference are condensed to a single motion (albeit one still subject to sixty votes if the minority objects). Other proposed changes alleviate the minority leader from objecting on his colleagues’ behalf, undermining individual senators’ ability to threaten to filibuster without actually showing up. Then again, there’s no enforcement mechanism in the proposal: Senators would be counting on the minority leader to play by the new rules and to abandon his practice of lodging objections on behalf of his absent colleagues. It’s fair to be skeptical that such informal reforms would ever stick.

Fourth, I think there’s promise in the proposal’s directive to the presiding officer to put questions to a (majority) vote when opponents no longer seek to debate a bill. I share skeptics’ views that majorities might rarely want to hold the minority’s feet to the fire to wear down the opposition and that minorities might at times relish the spotlight while holding the floor. But the proposal strikes me as a potentially valuable chance to see if the change would make a difference. If approved, the McCain-Levin proposal would be adopted as a standing order of the Senate for just the upcoming Congress, providing a testing ground for this version of the talking filibuster. (Standing orders are typically approved opening day by unanimous consent; would there be such consent for McCain-Levin or another negotiated proposal?)

Finally, it may be that incremental procedural change is all that a polarized Senate can agree on—especially if some Democrats are skittish about changing the rules by majority vote. Granted, majority senators won’t agree to the plan if it’s perceived as empowering the minority, not the majority, as Senator Harkin has suggested. Nor should they. In that case, an incremental package may be more than a polarized Senate can agree on—leaving the nuclear option as the only avenue for Democrats seeking to rein in the excesses of the Senate minority’s parliamentary rights.

Today could have been the day when Senate Democrats went nuclear – reining in minority party abuse of the filibuster with a simple majority vote.  That would have been my Super Bowl.  Instead, the Senate is poised to adopt a bipartisan set of modest (many say, meager) changes to the Senate’s cloture rule.   More like the Famous Idaho Potato Bowl, I say.

As many have noted (for starters, Ezra Klein here and Jonathan Bernstein here), the proposed changes to the Senate’s Rule 22 fall far short of what reformers had hoped for.  Much blame has been heaped on Harry Reid, the Democratic leader, and on a few senior Democrats, highlighting their resistance to abandoning the Senate’s sixty-vote threshold for bringing the chamber to a vote.  The reforms are modest, largely finding ways of speeding up the Senate once both parties have agreed on the matter at hand (for instance on the way to advancing a measure to the floor or after cutting off debate on a nomination).  Even if the changes may seem to many like small potatoes, I think there’s more to be gleaned from the Senate’s brush with reform.

First, take a little, give a little.  Today’s rule changes remind us that there is no free lunch when it comes to Senate reform.  That hurdle is built into Rule 22, given its requirement that 67 senators consent to a vote on efforts to reform Rule 22.  In the absence of majority willing to bear the costs of asserting the majority’s right to change its rules, Senate reform is necessarily bipartisan and incremental.  Reforms must secure the consent of the minority, or be packaged with changes judged equally important to the opposition.  (Recall that even when reformers reduced cloture to 60 votes in 1975, they paid a price: 67 votes would still be required to end debate on changing Rule 22.)  Today’s reforms allow a majority to circumvent filibusters of motions to proceed to legislative measures.  In return, the majority pays a price each time: The minority is guaranteed votes on two amendments, whereas previously recent leaders might have precluded all amendments by immediately “filling the tree.”  To be sure, this potentially dilutes the value of the rule change for the majority.   But concessions are dictated by the Senate’s inherited rules.  (And, of course, nothing is that simple when it comes to Senate rules; the majority may yet fill the tree, at least after the disposition of the minority’s amendments.)

Second, I suspect we might be underestimating the importance of a non-debatable motion to proceed for the majority party in a period of partisan polarization.  Judging from the increase in filibusters on the motions to proceed in recent years, minority parties have fought hard to keep bills off the floor that they oppose on policy or political grounds.   So long as the motion to proceed could be filibustered, majority and minority parties shared agenda-setting powers.  Today’s change grants the majority a slightly stronger hand in choosing the chamber agenda.  To be sure, the minority can still filibuster the bill and amendments beyond those newly guaranteed, but the reform undermines the minority’s ability to throw the majority off course.  Take immigration policy, for example.  Filibusters of the motion to proceed have kept the DREAM Act off the Senate floor in recent years.  Minority influence over the Senate’s agenda is diminished with today’s reform.

Third, these are leader-driven reforms, shaped by the unique burdens carried by the majority and (sometimes) minority leaders.  For example, the reforms speed up post-cloture debate on some judicial and executive branch nominations, and allow the chamber to hurry onto cloture votes on motions to proceed to legislative business when the minority offers a modicum of support.  No surprise that these housekeeping changes elicit little enthusiasm.   These changes don’t make it any easier for a majority to break sizable minority opposition.  And they potentially make it harder for rank and file senators to exploit the rules in pursuit of their own policy goals.  But from leaders’ perspectives, the reforms rein in the excesses of rank and file dissent when a bipartisan group is ready to move ahead.  As one Senate Democrat aide confided, “that’s all Reid ever really wanted.”

Finally, this episode highlights the limitation of the Constitutional option and other “reform-by-ruling” strategies.  There appears to have been a majority or near-majority support for securing only very limited reform of Rule 22.  Senators seem unwilling to use the tactic for a major overhaul of the Senate’s cloture rule—in part because of the fear of minority retaliation, in part because the filibuster rule likely serves as the foundation of senators’ power.   To be sure, Harry Reid aggressively used reform-by-ruling in the fall of 2011 to secure smaller changes to Rule 22 (as did Robert Byrd in the 1980s).  But we have to reach back nearly forty years to the 1975 reforms to find a Senate majority willing to go nuclear to impose major changes to Rule 22.  (Even then, reformers proceeded without the support of the majority leader, Mike Mansfield.)  Perhaps senators see the consequences of weakening Rule 22 in a different light when the parties polarize over policy problems and solutions, with senators nervous about curtailing extended debate when the tables turn on their majority.  Regardless, so long as majorities will only form to impose  minor reform by majority vote, those majorities will be forced to live under supermajority rules that daily frustrate their policy and political agendas.

And in the Senate’s world, those frustrating days can last for weeks!

EXECUTIVE SUMMARY

The Obama Administration has announced that fixing the nation’s financial system is one of its highest initial priorities and will shortly release a plan to do that. In this essay, we attempt to provide our own version of a roadmap for reform.

We believe that the central challenge confronting policy makers now is to establish a new regulatory framework that will do a far better job preventing financial abuses and their consequences without chilling innovation and prudent risk-taking that are essential for growth in any economy.

To accomplish that end will require a major restructuring and strengthening of the two pillars upon which an efficient and safe financial system must rest: market discipline and sound regulation. It would be a mistake, in our view, to conclude that because both these pillars failed to prevent the current crisis that either one should be jettisoned. Neither pillar alone can do the job. There is no alternative, we need both pillars, but both need to work much better in the future.

The United States has a history of enacting major legislation and adopting new rules in response to crises, and this time will be no exception. The critical challenge is to ensure that reforms remedy the flaws in the current framework; that they are sufficiently flexible to adapt to changing circumstances and to head off future, avoidable crises, and, all the while, that they do not amount to overkill, by chilling the innovation and prudent risk-taking on which continued economic growth very much depends. These objectives will most likely be met if policymakers have a suitable roadmap for guiding their reforms. We suggest the following:

1. Multiple measures should be adopted to improve transparency and increase the incentive for prudent behavior throughout the mortgage process.

    

2. A special set of prudential rules should govern the regulation of systemically important financial institutions (SIFIs), or those whose failure could have systemic consequences, and thus trigger federal rescues.

    

3. A prudential regulator should require all SIFIs to fund some portion of their assets with long-term, subordinated debt. Such debt might also be convertible to equity in the event the institution’s capital-to-asset ratio falls below a certain level.

    

4. Regulators should encourage the formation of clearinghouses for derivatives contracts, starting with credit default swaps, and empower an overseer.

    

5. Financial reforms should be written broadly enough, and with enough discretion for regulators, so that policy makers can better anticipate future financial crises, however they might arise.

    

6. The financial regulatory agencies should be reorganized, so that they have jurisdiction by function or objective (solvency and consumer protection) rather than by type of charter of the regulated financial institution.

    

7. In the short to intermediate run, the housing GSEs — Fannie Mae, Freddie Mac, and the Federal Home Loan Bank System — should be regulated as public utility “SIFIs” (after recapitalization with public funds) or directly operated as government agencies.

    

8. While U.S. financial policy makers must support international cooperation on financial regulation they should not wait for international agreement before taking necessary steps to improve our own system.

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• Options for Fixing Finance

Access to information and communication technology through cell phones, the internet, and electronic media has increased exponentially around the world. While a few decades ago cell phones were a luxury good in wealthy countries, our data show that today over half of respondents in Sub-Saharan Africa and about 80 percent of those in Latin America and Southeast Asia have access to cell phones. In addition to making phone calls and text messaging, cell phones are used for activities such as accessing the internet and social network sites. Meanwhile, the launch of mobile banking gives access to these technologies an entirely new dimension, providing access to financial services in addition to information and communication technology. It is estimated that in Kenya, where the mobile banking “revolution” originated, there are some 18 million mobile money users (roughly 75 percent of all adults). Given the expanding role of information technology in today’s global economy, in this paper we explore whether this new access also enhances well-being.

Neither of the authors is an expert on information technology. The real and potential effect of information technology on productivity, development, and other economic outcomes has been studied extensively by those who are. Building on past research on the economics of well-being and on the application of the well-being metrics to this particular question, we hope to contribute an understanding of how the changes brought about by information and communication technology affect well-being in general, including its non-income dimensions.

Our study has two related objectives. The first is to understand the effects of the worldwide increase in communications capacity and access to information technology on human well-being. The second is to contribute to our more general understanding of the relationship between well-being and capabilities and agency. Cell phones and information technology are giving people around the world – and particularly the poor – new capabilities for making financial transactions and accessing other services which were previously unavailable to them. We explore the extent to which the agency effect of having access to these capabilities manifests itself through both hedonic and evaluative aspects of well-being.

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In the course of two days last week, the U.S. Congress passed two foreign aid bills.

What’s more, in the course of five months, Congress has passed three foreign aid bills!

All three bills passed with strong bipartisan leadership and support.

Equally important, all three bills reflect a new era of a more modernized approach to assistance.

The bills avoid many of the problems of past aid legislation, including micromanagement, earmarks, and requirement of frequent reports that are seldom read by members of Congress or their staffs. Each bill was developed in cooperation with the Obama administration and reflects its policies and civil society priorities. And they emphasize strategic approaches, results, use of data, monitoring and evaluation, and learning.

The Foreign Assistance Accountability and Transparency Act of 2016, sponsored by Republicans Sen. Marco Rubio and Rep. Ted Poe and Democrats Sen. Ben Cardin and Rep. Gerry Connolly, is grounded in important principles of foreign aid reform. It enacts into law key policies advocated by the Modernizing Foreign Assistance Network and supported by the U.S. Global Leadership Coalition and many other international development and foreign policy organizations. Robust evaluation and aid transparency, first elevated as elements of the Millennium Challenge Corporation by the Bush administration and later adopted by the Obama administration across all foreign affairs agencies, are institutionalized by the bill. The bill calls for two reports 18 months after enactment, not annual, year-after-year reports, which had been the normal practice and usually resulted in shelves of unread reports. One report will be from the president outlining the monitoring and evaluation guidelines called for in the report, and the other report will be from the Government Accountability Office assessing those guidelines.

This type of independent, objective evaluation is essential to improving assistance; it assesses what we have tried and improves our understanding of what does and does not work. When aggregated across multiple evaluations of similar programs, it produces new knowledge and learning.

Transparency, another important element of aid reform, brings multiple benefits. It provides all stakeholders, including Congress, U.S. taxpayers, intended beneficiaries, government officials, and civil societies in recipient countries, with data and information that allows them to understand where and how assistance is used. It provides data that is critical to making informed decisions. And it keeps agencies and programs focused on their mission and objectives by permitting public scrutiny and accountability.

The Global Food Security Act of 2016, sponsored by Republicans Sen. Johnny Isakson and Rep. Chris Smith and Democrats Sen. Bob Casey and Rep. Betty McCollum, writes into law the administration’s initiative Feed the Future. The core of the bill is a mandate of the president to coordinate a comprehensive U.S. global food security strategy—such a forward-looking strategy will help gain stakeholder buy-in and ultimately provide more consistent, rationale policies and programs. Also included are guidelines that we know from experience produce good development—measurable goals and performance metrics, solid monitoring and evaluation, clear criteria for selecting targets, alignment with local policies and priorities, multi-sectoral approaches, building local capacity and resilience, and partnership with the private sector. The bill authorizes funding for food security but does not earmark it—meaning the funds are authorized but are not required to be expended. And the bill calls for only a single report to Congress a year after the issuance of the strategy.

The third bill, the Electrify Africa Act of 2015, sponsored by Republicans Sen. Bob Corker and Rep. Ed Royce and Democrats Sen. Ben Cardin and Rep. Elliot Engel, is centered on a comprehensive energy strategy for Africa. Similarly, the legislation calls for a strategy that is flexible and responsive to local communities and for policies that promote transparent and accountable governance, local consultation, and monitoring and evaluation. The bill requires two reports, the first within six months of enactment to transmit the strategy and the second three years after enactment to report on implementation. The bill directs U.S. government agencies to use accountable and metric-based targets to measure effectiveness of assistance and to leverage private and multilateral finance.

For those who say that Congress does not support foreign assistance, let’s hope this legislative triple-hat puts that to rest. Similarly, for those who say the Congress does not understand a more effective approach to development, maybe it’s time to become a believer.

Visiting Fellow Michael P. McDonald joins Kojo Nnamdi and guests to discuss congressional redistricting and other pressing election reform issues.

Listen to the interview »

After decades of abuse under the old regime, how can the civilian government of President Mohamed Morsi turn Egypt’s security apparatus into one befitting a new democracy? What are the necessary steps in overcoming institutional barriers to reform and creating an Egyptian police force in the service of its citizens?

In a new "Project on Arab Transitions" paper from the Brookings Doha Center and Stanford University’s Center on Democracy, Development, and the Rule of Law (CDDRL), From Good Cop to Bad Cop: The Challenge of Security Sector Reform in Egypt, nonresident fellow Omar Ashour discusses the political dynamics of transforming Egypt’s security establishment.

Based on months of interviews with current and former officers and generals in the police, army, and intelligence services, Ashour lays out the workings of the Mubarak regime’s repressive security apparatus and assesses current reform initiatives, drawing on lessons from other transitions in the Arab world and beyond. He offers a set of policy proposals for establishing an accountable, civilian-led security sector, ranging from a presidential commission on reform to new oversight mechanisms. Ashour cites the brutality and abuse of Egypt’s police as a key catalyst of the January 25 Revolution; the success of that revolution, he says, will hinge on effective security sector reform.

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Donald Trump has made waves during this year’s election cycle by taking a hard line on illegal immigration. This, however, builds on years of heated debate among policymakers. It is also an enduring hot-button issue in Arizona, which has passed several immigration laws over the years.  In 2010, the passage of SB 1070 brought national attention to this debate.  Deemed the strictest immigration law to date, SB 1070 sought to achieve “attrition [of illegal immigrants] through enforcement” by requiring law enforcement to detain any person whom they believed to be residing in the country illegally. Although SB 1070’s effects on individuals and families have been well documented, little is known about its impact on students and schools. To this end, we sought to estimate the relationship between the passage of SB 1070 and school-level student achievement.

We anticipated that anti-immigration policies would primarily affect children from the families of undocumented immigrants. Such effects could be observed in different ways. For instance, the emotional and psychological distress of these children could result in a decline in average test scores at the school-level. On the other hand, students might have left the country or the state under the threat of being deported in which case school-level test scores would rise (since these students often perform below their peers). To this end, we considered three scenarios: 

1. Immigrant children remain in the state but experience higher levels of stress.  As a result, average school-level test scores will drop while Hispanic enrollment remains the same.
2. Children of undocumented immigrants leave the state, which results in a drop in Hispanic enrollment accompanied by an increase in school-level test scores.
3. Or, the first two scenarios occur simultaneously and we do not observe any change in test scores since the two effects would cancel each other, but note a slight decrease in Hispanic enrollment.

In order to see which of these hypothetical scenarios is supported by the data, we first estimated the relationship between the passage of SB 1070 and average school-level reading test scores. We then attempted to unpack the mechanism through which such an effect might have taken place. To this end, we used publicly available data on school-level achievement and enrollment collected by the Arizona Department of Education (ADE). Given the targeted nature of the policy and the demographics of immigrants in Arizona, the majority of whom are of Hispanic or Mexican descent, we focused on schools that traditionally enroll large proportions of Hispanic students. We identified schools with high (more than 75 percent) shares of Hispanic students as those whose average achievement and student composition are most likely to be affected by immigration reform. We contrasted changes in school-level achievement and enrollment in those schools with schools that enroll less than 25 percent Hispanic students, as these schools are less likely to experience any changes as a result of tightening immigration laws.

Figures 1 and 2 show trends in the average percentage of students passing the state reading test and average Hispanic enrollment at these schools between 2006-2007 and 2011-2012.           

Figure 1. Average Percent of Students Passing AIMS Reading

Figure 2. Average Hispanic Student Enrollment

Clearly, the rate of growth in school-level reading scores was much higher for high Hispanic schools after the passage of SB 1070 in 2010 (Figure 1). At the same time, there was a significant decrease in Hispanic enrollment in these schools (Figure 2). Thus, it appears the second scenario is likely driving the patterns we observe.

The data also suggest that the trends for high Hispanic and low Hispanic schools started diverging before the passage of SB 1070 - after the 2007-2008 school year.  This happens to be the year that Arizona passed an even more restrictive, though less controversial, immigration law – the Legal Arizona Workers Act (LAWA). LAWA required Arizona business owners to verify the legal status of their employees using E-Verify, an online tool managed by the federal government. Although LAWA used a different mechanism, similar to SB 1070 it sought to achieve the attrition of undocumented immigrants from the state. 

We then would anticipate both laws to have similar effects on school-level achievement and Hispanic enrollment. Indeed, we estimated that LAWA likely led to an average increase of roughly 4 percent of students passing the state reading test at high Hispanic schools. This was accompanied by an average loss of 38 Hispanic students per school. Because the passage of SB 1070 was preceded by the passage LAWA as well as a language policy that would have affected treatment schools, disentangling the effects of these two policies is not straightforward. However, based on our analysis, we estimate that SB 1070 is associated with an average increase of between 1.5 percent and 4.5 percent of students passing the state reading test at the school-level accompanied by an average loss of between 14 and 40 Hispanic students. 

Despite the fact that we cannot pin down the exact magnitude of SB 1070’s effect on school-level achievement, our analysis shows that when Arizona passed restrictive immigration laws in 2008 and 2010, it looked as if the state’s lowest performing schools were improving rapidly. This, however, likely had more to do with the changing composition of schools as an indirect though anticipated effect of immigration policies than with policies aimed at improving student achievement. 

Despite this, the Arizona Department of Education took credit for these gains. Similarly, Arizona was recently recognized as one of the nation’s leaders in growth on the National Assessment of Educational Progress (NAEP) over the last ten years. Although wrongly attributing these gains may seem harmless at first glance, it is important to remember that Arizona is viewed by many as a model for controversial education reforms like school choice and high-stakes accountability. It is easy to imagine how policymakers might look at increasing test scores in Arizona and wrongly attribute them to these kinds of reforms. That’s not to say that these policies don’t have merit. However, if other states adopt education policy reforms under the assumption that they worked in Arizona, then they might find that these policies fail to deliver.

Bruce Katz presented a speech on demographic shifts in the country's largest 100 metropolitan areas and how various leaders, including those in Seattle, will meet the policy challenges of a changing nation.

Introduction:
Today, I would like to present our findings from a major research initiative at the Metropolitan Policy Program, which is accompanied by an interactive website: the State of Metropolitan America. Our report examines the demographic trends that have affected the top 100 metropolitan areas so far this decade, covering the year 2000 through the year 2008. We find a nation in demographic transformation along five dimensions of change.

Watch video of the speech on the Seattle Channel »

We are a growing nation.  Our population exceeded 300 million back in 2006 and we are now on our way to hit 350 million around 2025.

We are diversifying.  An incredible 83 percent of our growth this decade was driven by racial and ethnic minorities. 

We are aging.  The number of seniors and boomers exceeded 100 million this decade.

We are selectively educating. Whites and Asians are now more than twice as likely to hold a bachelors degree as blacks and Hispanics.

We are a nation divided by income. Low-wage workers saw hourly earnings decline by 8 percent this decade; high wage workers saw an increase of 3 percent.  

With this background, I will make three main points today.

First, America’s top 100 metropolitan areas are on the front lines of our nation’s demographic transformation.  The trends I’ve identified—growth, diversity, aging, educational disparities, income inequities—are happening at a faster pace, a greater scale and a higher level of intensity in our major metropolitan areas.  

Second, the shape and scale of demographic transformation is profoundly uneven across metropolitan America.  This variation only partially reflects the traditional division of our country into regions like New England or the Middle Atlantic or the Mountain West. Rather a new “Metro Map” of the nation is emerging that unites far flung communities by their demographic realities rather than their physical proximity. 

Finally, demographic transformation requires action at both the macro and metro scale.  The federal government and the states need to lead where they must to address the super-sized challenges wrought by fast change.  Metropolitan areas must innovate where they should in ways that are tailored to their distinct challenges and opportunities.  And the geography of transformation at the metro scale requires new institutions and ways of governing.

These policy and institutional changes will not be easy.

But let’s remember one thing.  In the global context, the United States is a demographically blessed nation.  Established competitors like Japan, Britain and Germany are either growing slowly or actually declining; rising nations like China remain relatively homogenous. 

In a fiercely competitive world, our growth and diversity may be America’s ace in the hole.

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Egypt needs a new inclusive and equitable economic growth model. Unemployment has spiked since the 2011 revolution, clearing over 12 percent, a figure which is not expected to decrease for several years at least and the situation is even more dire for the country’s youth. While the likely IMF program will offer the macroeconomy a measure of relief, it cannot reverse decades of mismanagement. Egypt’s private sector may therefore not experience a recovery in the near future. The government’s situation looks similarly stressed as its gross debt is projected to rise from 73 percent of GDP in 2010 to 79 percent this year. Combined with the confusion surrounding the government’s structure and organization, it is unlikely that the public sector can fill the jobs gap or provide the needed high quality and affordable goods and services. However, the legal limbo surrounding inclusive business models (IBs) as well as intermediary support organizations (ISOs), which are supposed to provide the needed support to IBs, has unnecessarily shrunk this sector of the economy and disabled it from playing its necessary role.

In his inaugural speech, Egyptian President Mohamed Morsi portrayed himself as a president for all Egyptians, including the menial and underprivileged rickshaw drivers. The Muslim Brotherhood’s Al-Nahda Program emphasizes social justice and a consensus vision across all groups in society. The new leadership is committed to social innovation with “a national strategy to develop mechanisms to support innovation dealing with community issues.”

Although the constitution has not yet been drafted and there is currently no parliament, this moment in time contains a golden opportunity for the government of Egypt to capture the energy, civic engagement and entrepreneurial spirit in the country. Under Mubarak, Egypt’s economic growth and business policy reforms helped foster the private sector, but 85 percent of the population continued to live under $5/day and this ratio did not change during the decade of growth prior to 2008. Safeguards against abuse and incentives for inclusiveness were missing, and the economy became dominated by crony capitalism with wealth concentrated in the hands of a few. People’s perception of inequity and dissatisfaction with public services increased. The governance indicators of “Voice & Accountability” and “Control of Corruption” deteriorated from 2000 to 2010, even though there was a steady improvement in “Regulatory Quality.”

Egypt needs an enabling legal framework to promote a more equitable growth model. Such a framework should encourage forms of inclusive businesses (such as cooperatives) and ISOs that could help micro and small enterprises. These firms (with less than 50 employees) represent nearly 99 percent of all non-public sector, non-agricultural firms and provide about 80 percent of employment in Egypt. But their expansion has been restricted because of the weakness of the ecosystem of incubators, angel investor networks, microfinance institutions (MFIs) and impact investors necessary to allow young entrepreneurs to start up and grow. This policy paper argues that legal and regulatory reforms that encourage ISOs and allow new forms of inclusive business to register and operate are a necessary first step towards a new inclusive growth model.

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INTRODUCTION

If you are one of those government officials, finance experts, development professionals or NGO members whose eyes glaze over when you see an article on procurement, you are the audience I want to address. Procurement is the purchase of works, goods and services by individuals or firms, or government entities in the case of public procurement. We all make procurement decisions in our everyday lives. We pride ourselves on making good decisions and being able to apply discretion and judgment. Now imagine if you were improving your home and were constrained by pages and pages of legal and technical regulations that take away that discretion. You would soon question whether those regulations were relevant and whether they provide any value or simply delayed and jeopardized good decision-making. Worse yet, imagine if you had to follow rules that someone else outside your family, your community or your country set for you. While public procurement requires a higher standard of governance than personal procurement, developing countries and other stakeholders are raising these questions regarding the policies set by multilateral aid institutions.

In November 2013, the World Bank released the report of its first stage efforts in reforming its procurement policy as it relates to the projects it finances. As the World Bank enters the second stage in designing the actual reforms, the “development community” faces a crucial moment and opportunity to refine and reform a fundamental instrument in the development toolbox—one that has been treated for too long as a “plumbing and wiring” issue that ignores the broader public policy implications and the growing burden of conflicting objectives, regulations, incentives and political polemics. The purpose of this paper is to examine concerns regarding reform of multilateral agencies’ public procurement policies, enhance awareness of what is at stake and lay the groundwork for the reform discussions at development institutions that will take place over the next year.

I should alert you, however, that I am neither a procurement specialist, nor am I a lawyer or an engineer. I would describe myself as a development practitioner. After decades of working on infrastructure projects and on multilateral operational policy, I have maintained a deep respect for my procurement colleagues who have protected my proverbial “backside.” One quickly learns in this business that a mistake in procurement can result in serious consequences as one sits in the middle of the converging, and often conflicting, interests of governments, donors, private sector and, of course, affected communities. The procurement policies applied by the multilateral finance institutions have been responsible for enhancing competition, deepening transparency and raising the integrity of investment in developing countries, as well as opening markets for developed and developing countries’ businesses. As the world of public procurement has evolved, however, one also learns that procurement is becoming more than just getting the “plumbing and wiring” right. Indeed, the role and application of public procurement policies and practices is an essential element of design and implementation with crucial consequences for the quality of outcomes. The case set forth in this paper lays out the factors driving the need for major reform of multilateral banks’ procurement policies—rather than simply adapting existing policies. This paper also presents the major challenges to be addressed in designing the reforms and the tensions to be resolved or balanced as the World Bank enters the more detailed design stage of its reform effort.

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