Obama Revives Agency Consolidation Proposal

Advance summaries of President Obama’s fiscal 2016 budget say the $4 trillion plan will include proposals to “consolidate and reorganize government agencies to make them leaner and more efficient,” according to a Monday White House fact sheet.

That could mean a resurrection of a plan Obama offered in January 2012 that would have provided the president with fast-track priority in Congress to seek to save $3 billion over a decade by whittling down six major departments and agencies that handle business and trade.

That plan drew mixed reactions from business and environmental groups as well as lawmakers who sought a more “collaborative” approach, in the words of Rep. Darrell Issa, R-Calif.

The earlier Obama plan was billed as creating a new department “with a laserlike focus on helping businesses create jobs,” according to an OMB official at the time. The president would have one chief executive officer to ask about program effectiveness and foment a “greater sense of accountability” while facilitating a “whole of government” approach to trade policy.

These include core business and trade components of the Commerce Department, the Small Business Administration, the Office of the U.S. Trade Representative, the Export-Import Bank, the Overseas Private Investment Corporation and the U.S. Trade and Development Agency

The bid to reorganize goes back to a December 2010 study on boosting competitiveness produced by the liberal-leaning Center for American Progress. Past presidents enjoyed such consolidation authority until Congress took it away during the Reagan administration.

At least one Republican lawmaker recently expressed support for such a consolidation. Sen. Richard Burr, R-N.C, said, “Unfortunately, Senate Democrats dropped the ball on the bipartisan idea of agency consolidation -- including ideas suggested by President Obama,” he said late last year. “I look forward to working with my colleagues in the new Congress to advance the sensible goal of reducing spending and making government more effective by consolidating duplicative government activities."

The small business community may not be happy. Lloyd Chapman, founder of the Petaluma, Calif.-based American Small Business League, accused Obama of “wanting to eliminate the Small Business Administration” at a time when small businesses are struggling to win more government contracts from larger companies.

A second efficiency provision in the administration’s 2016 budget proposal is a plan to cut “red tape in the infrastructure permitting process.” That proposal could line up well with a bill just introduced in the Senate by Claire McCaskill, D-Mo., and Rob Portman, R-Ohio, to streamline multi-agency permitting and centralize coordination and transparency of the process.