Priorities

Social Security's Office of Inspector General (OIG) has issued a report on how Social Security spends its appropriated funds. There are a couple of interrelated issues covered. One issue is the appropriated money that remains unspent each year. Towards the end of each fiscal year the Office of Management and Budget (OMB), which is part of the White House, has been allowing Social Security to transfer funds that will not get spent before the end of the fiscal year to a "no-year" account that Social Security can spend in later years. This is nothing new. It has been going on for decades. At least lately, these transfers have not been nickle and dime affairs. Social Security just transferred $280 million to a "no-year" account. That is something like 2.5% of its total budget for the year. At least lately, the transferred money has been going into an account that can only be spent on information technology. The second issue is the return on investment of the money spent on information technology. Social Security is not able to document much return on investment on some of its technology expenditures.

I had concerns about technology expenditures during the term of the previous Commissioner. Even though the agency was collapsing around Commissioner Barnhart, she kept diverting more and more of the agency's scarce resources to long term information technology projects. My fear was that she wanted to make sure that as much money as possible went to contractors (who are more likely to be Republicans) than to employees (who are more likely to be Democrats and union members as well.)

OIG is asking pertinent questions about what is going on today. The service that Social Security is giving the public is not as bad as it was but it is still far from satisfactory. More money is being spend on hiring employees but still there are not enough of them to get all the work done. Huge sums are being spent or committed to information technology projects. There are still huge backlogs in continuing disability investigations and Supplement Security Income (SSI) redeterminations. Why is so much money remaining unspent at the end of each fiscal year? Why is so much money being diverted to information technology? What is the return on investment on Social Security's information technology? Is a proper balance being struck between having enough personnel to get the work done and having good technology to help get the work done?

I wonder how Social Security's operating budget would be spent if Michael Astrue had resigned as Commissioner at the end of 2008 and been replaced by a Democrat. Would Social Security's operating budget be spent differently? To ask this is not to suggest that Commissioner Astrue's decisions on spending have been politically motivated or that he does not care about the service that his agency delivers to the public. However, personal beliefs inevitably impact the decisions made by agency heads. It is only a slight oversimplification to say that it has been an article of faith among Republicans in recent decades that federal employees are bad and private contractors are good. It is reasonable to ask questions about how such a philosophy might be impacting spending decisions at Social Security.