Wednesday, January 30, 2008

Budget savings or a cheap gimmick

The Office of Management and Budget has announced that it will stop providing free printed copies of the President's budget for members of Congress and their staffs. Printed copies will still be available, but members will have to shell out $200 per copy. As in previous years, an electronic version of the document will also be posted on the web.

The move will clearly save the White House money, but is it good policy? Members of Congress don't think so.

Congress is understandably upset because the White House is shifting a set of costs from its budget to Congress'. So, from a taxpayer perspective, the savings aren't as big as the White House is touting. One group's costs have gone down, while another group's have gone up.

However, there probably will be savings. Free goods get misused, or more precisely over-consumed. At $200 a pop, a Congressperson (or more likely her chief of staff) will think twice before handing a copy of the budget out as a souvenir or giving a copy to the intern who runs the autopen. Congressional offices will now have to compare the benefits of a paper copy to the actual costs of production. Demand for the printed copies is likely to go down, leading to less printing and lower overall costs for the government.

From a social standpoint, there are also some downsides. Many types of budget work are easier to do with printed copies. By making paper copies more expensive, the White House is raising the cost of Congressional oversight and increasing the likelihood that something will slip by unnoticed. In other words, the White House is increasing the cost of good government. However, it is legitimate to ask how many printed copies are necessary to perform this function.

Some other costs of this policy may also be overlooked. People working with e-documents often print sections or whole copies from their office computers. This is a much less efficient and more costly way to generate copies. As staffers seldom see the marginal cost of each print-out, this can lead to overuse and some very high costs.

One gets the sense that President Bush gets a kick out of sticking it to Congress, and there is certainly an element of that in this latest move. However, the change in printing policy looks like a net cost-saver.