Sequestration, as it is likely to be implemented in a Federal show down scenario, is likely to amount to “across-the-board” cuts for Federal Departments and Agencies. This would result in “Across-the-Board” cuts of 9.4% for the Pentagon, National Guard, the Energy Department’s National Nuclear Security Administration and other discretionary defense efforts over the next decade, and an 8.2 % spending cut for most nondefense discretionary programs — including the Secret Service, the Drug Enforcement Administration, the U.S. Marshals Service and the Bureau of Alcohol, Tobacco, Firearms and Explosives. (//www.politico.com/news/stories/1112/84023.html#ixzz2D8rJRedI)
Compared to reasoned allocations of resources, across-the-board spending cuts are very ineffective. Why? Because the relative benefits of different programs vary widely across programs, as well as within programs.
Because the relative benefits of different programs vary widely. Across programs, as well as within programs, the relationship between the impact (reduction in effectiveness) caused by across-the-board cuts and the amount of the cuts is not linear. For example, a 5% cut in spending for one program might result in only a 2% cut in effectiveness, while a 5% cut in spending for another program might result in a 15% decrease in effectiveness.
What if, we could put ourselves in a better position to avoid taking the easy way out and instead, make the effort to realize the increased benefits of an optimized approach? What-if we gave program experts a time table that required them to ‘design’ alternative approaches to achieving a program’s objectives for different budget levels? What-if we knew, or made really good estimates in advance of how much more effective each Department or Agency might be for a planned level of optimized resources?
Management science and computer technology advances have given us the tools to optimize outcomes for budget cuts applied to a broad array of projects. Today, there are processes and tools for synthesizing data, informed opinions, knowledge and expertise from a wide variety of constituents and that can produce estimates of anticipated benefits at different levels of funding. And there are readily available techniques to produce optimal allocations of resources for different scenarios and to assist interested parties in collaboratively and coming to consensus on compromises that are not just easy to make, but are ‘optimal’ in producing a portfolio of investments with the highest benefit possible given limited resources and other constraints. (For a good list, visit http://prioritysystem.com/tools.html.)