The case before us today involves apparent abuses of the workers compensation system, specifically as it relates to claims filed by government employees. In this wide-scale probe into workers comp claims, the feds have focused on three arbitrators, one downstate correctional facility, and seven different state agencies. The details are appalling, but at this point, not shocking or unexpected; we can lose our sense of surprise yet maintain a sense of outrage.

Not much incoming traffic, it appears

Speaking of an indictment of our government, one of the highlights (lowlights?) of the article is this gem from our Governor, Pat Quinn:

Appearing in Belleville Thursday, Gov. Quinn praised the fact law-enforcement was investigating the state’s workers’ compensation system, which the governor said he wants to overhaul this spring.

“We want to make sure everything is done right when it comes to workman’s compensation,’’ Quinn said. “Those who are injured we want to make sure get fair compensation. At the same time, if there’s any fraud, if there’s any abuse, if there’s any monkey business, if there’s any wrongdoing, it’s got to be prosecuted.’’

At some point, I’d expect a manly sense of pride would lead our Governor to cease praising federal investigators and instead, perhaps, as the state’s chief executive officer, take some responsibility for making sure that we’re running our own house properly. Then again, perhaps, it’s unreasonable of me to expect a manly sense of pride from our Governor.

We have a long road ahead of us, reformers. The journey may seem daunting, and when the end is not visible to us a natural inclination not to begin the journey may set in. We are each to be called to an accounting of our time, and we ought to remind ourselves that in the words of General Washington, our situation has been unpromising before yet we’ve only to increase our efforts to change our fortunes.

One last point, as well, I shall make: a popular sentiment exists that consolidating government services and eliminating units of government would be a beneficial reform; that doing so would somehow make government operate with more accountability. If the operations of our state government tell us anything, it is that we would be better served with most operations of government very close to home. If someone wishes to defraud the public, they will find a way; yet, the magnitude and duration of such a fraud would by reason be minimized the closer the operations are to the great mass of the public.

The work that Adam and I do is a lot like turnaround management, but focused on the government. If you’re not familiar with it, turnaround management is the corporate equivalent of the relationship a sick person has with their doctor. Not surprisingly, if you read the title of this post, the ailing patient exhibits symptoms of being unwell; they seek help from a professional who determines why they are having these symptoms; the professional outlines a course of treatment or remedy; and the ailing patient improves, or the process begins anew.

What's the prescription for what ails us?

Q: Does government at every level exhibit the symptoms of being not well?

Last week, somewhat under the radar, DuPage County was in the news when it was revealed that there was gross mismanagement in the DuPage Housing Authority. To Chairman Cronin’s credit, he’s taking action, but the horse is already out of the barn. The DHA, which receives federal funds and administers housing assistance, owes Uncle Sam an estimated $10.75 million as a result of improper payments and financial mismanagement. Which means, fellow residents of the County, ultimately you and I owe Uncle Sam that money.

I could spend the next week regaling you with stories of government not being well, but based upon your involvement with FTGOI, I’m guessing you don’t need the additional evidence. We concur that government seems to be broken infrequently, and not working well the remainder of the time. Let’s cut to the diagnosis.

For too long, government has operated in the absence of citizen involvement and outside the realm of its intended responsibilities, and under the assumption that next year’s budget will be 5% more than this year’s. The latter has covered up widespread instances of sloppy and unprofessional management, and the former has ensured that government grows and that those instances never saw the light of day. This is the diagnosis. Stopping here, without a plan and the will to return to health will just result in further sickness; in government this is called an economic death spiral.

The prescription is rather easy to outline. First, we deserve a better class of elected official – and it appears that in many cases we’re getting them. This is because of heightened citizen involvement. Increased citizen involvement through groups like mine and FTGOI also acts like an insurance policy – actions that might never have seen the light of day before are going to be discovered and reported. Now before we all pull a muscle patting ourselves on the back, we ought to consider that we’re just touching the tip of the iceberg, and the funny thing about icebergs is that it is what you don’t see – the giant mass that remains hidden – that is the real risk to the survival of the ship.

If we keep up the work, if we continue to ratchet up our involvement and activism, if we exert ourselves like free men (and women) defending our liberty, the day may come when we realize the cure: accountable government, restricted at each level to the things it is designed to do, which delivers necessary services and stays out of the way in everything else.

I have had the honor of serving as an elected township official for two years. Like every elected official at any level, I took an oath. Taking oaths is a risky business, as it creates all kinds of consequences, and it is not a contract to be entered into lightly. One such consequence created by taking an oath is that having been duly chosen by the electorate to discharge a duty, it is immoral to avoid that duty.

Government of, by and for the insider?

Put another way, if you’re a Wisconsin Democrat, represented by a Democrat legislator, you’re really only secondarily represented by your legislator. They first have to represent their primary donors and benefactors. Then, and only if there isn’t a conflict between you and their real boss – the union who butters their bread – you the Wisconsin voter may be considered.

There will come a time in Wisconsin, in Illinois, and all America when the electorate begins insisting on a different type of representation. In some cases, that day has already arrived. In some cases, it may be a cycle or two away. We can take comfort that behaviors like this, disappointing as they are, serve to hasten the day.

State Senator Ed Maloney of Chicago recently introduced bill SB 136, whose purpose is to regulate homeschooling in Illinois. It seems the Senator thinks that the government should know where kids are and what they are learning.

Homeschooling is one of those manifestations of self-government that one would hope we would see continually growing, especially considering the results that homeschooling delivers. Perhaps the Senator is really interested in the children and he’s proposed this bill for the children. I’m waiting to hear that line.

Would the last business to leave please turn off the lights?

Meanwhile, the state is on life-support, and neighboring states are rolling out the welcome mat to our businesses and their employees. This story on Monday indicates that seven companies are cutting in excess of 630 jobs in Illinois in the coming months. Job-killing tax increases and runaway spending are creating an economic death spiral.

Our General Assembly is hard at work, however: proposing interfering in the lives of citizens by more regulation and increased paperwork. Faced with the prospect of an economic disaster born of uncontrolled spending and government of the insider, for the insider and by the insider, our General Assembly… wants to regulate homeschooling.

To Senator Maloney and every other legislator who doesn’t get it: government is failing. Like businesses, government fails because of management. Plain and simple, it’s the people in charge who determine success or failure. It may take a while, but eventually shareholders will bring in new management to run the enterprise. Given the mess you’ve created and continue to enable, our time is short.

But yours is shorter.

Risk: the dynamic by which we have reward.

In a corporate example, when a management team fails to discharge its responsibility (deliver value to customers at a reasonable return for shareholders), the owners of that corporation will find new stewards who can get the job done. In addition to creating value (my shorthand for making something that consumers want at a profit for investors), corporate leaders must also be able to manage risk. They must do no harm; they can’t break laws, they have to ensure that the corporation’s employees want to continue to work there, and that the enterprise is sustainable. When corporate leadership fails to do this, a change is made. Perhaps new management has the skills, experience and knowledge that old management didn’t have; this is not uncommon and it is proper for this kind of turnover to happen across every industry as times and technologies change.

Strange and little-publicized things are happening in Illinois which are an indictment of current management. The troubling question for traditionalists and advocates for Constitutionally-consistent government is: should the federal government be stepping in where it has been?

Exhibit A is the Illinois Environmental Protection Agency. Illinois has had enough environmental problems in recent years and the Crestwood water contamination, among others, has given the distinct impression that something is amiss at IEPA. When the IEPA and the Federal EPA then executed this Memorandum of Agreement you would think it would be newsworthy. The gist of the Agreement is this: the US EPA is effectively going to be in charge now of environmental matters in the state of Illinois, thankyouverymuch. This isn’t the same as the FDIC sending a cease and desist letter to a mismanaged bank, but it’s pretty close.

Couple this with the SEC investigating our state’s pension system, and you can start to wonder if there’s a pattern developing. I’ve long asserted here that when units of government exceed their mandate, they begin to do nothing well, and the things that they are supposed to do and do well start failing. As I said in the post entitled “It’s Complicated”:

The problem is that our government in Washington is operating a little like the circus performer who spins plates on poles. Spinning a couple of plates isn’t such a challenge. But as more and more plates are added, the performer trying to keep track of all of those spinning plates just can’t keep up. Before long, plates start hitting the ground.

As I’ve noted before, we have a responsibility problem, just like the fellow spinning the plates. People and units of government have allowed too much consolidation in distant spheres of government. A Republic simply can’t do as much as ours is trying to do. It can try, but it will fail, and sometimes fail spectacularly.

So when a state gets into the universal kindergarten business, or the providing free transportation to seniors business, or into the gaming business, or into any business that it has, well, no business getting into, it starts to “drop the ball” so to speak on the things it should be doing.

A larger question that I’ll punt on for now is this: if the government/agency isn’t doing it’s job – if the SEC isn’t creating safe and stable markets, if the FDA isn’t preventing food-borne illnesses, if the Department of Education isn’t helping kids get educated to be productive citizens – why should we continue to fund it?

For now, while the public insists on “the government” protecting the environment, when the state can’t do it properly the feds will have to step in. If the state is ineptly managing its pension liabilities, which it may or may not be, then perhaps the feds will have to step in there as well. It would be advantageous to our collective livelihood and reputation (not to mention our long-term attractiveness for business) for our state to get its act together. We’ve got a couple years before the next election, just having completed a cycle, and we’ve got our chief executive until 2014. If this leadership team can’t get the job done, however, it’s up to the shareholders to make a change.