Failing the Washington IQ Test
Take this simple IQ test: If you could invest $9.5 billion once and get back more than $40 billion every year, forever, would you make the investment? This is not a trick question. And it doesn’t take a rocket scientist (or Warren Buffett) to say “yes.” In fact, it’s a no-brainer. For those of you doing the math, that’s a 400+% annual return. Sign me up!
Yet Democrats in Congress failed the test, as did The New York Times, armed with a report from the Government Accountability Office that never even attempts the second half of the math. Why?
First, the facts.
The Trump Administration has reduced the total size of the federal government by roughly 270,000 employees since the beginning of the term. That’s a nearly 10 percent reduction. There are about 2 million employees still today, leaving the federal workforce at its smallest level since the 1960s.
In most organizations, headcount reductions come through restructuring: an across-the-board layoff of some fixed percentage or shutting down particular divisions. In the private sector, few legal rules govern severance, but employees generally receive one to two weeks per year of service.
The federal government is similar and different.
By law, federal employees are entitled to one week of severance per year of employment for their first 10 years and then two weeks for every year thereafter. There are caps and a modest age bump for employees over 40, but in general the government tracks the private sector.
Where the federal government differs is in the tools available to reduce headcount.
The legacy reduction-in-force procedures that were in place when the Trump Administration took office were overly complex and made it difficult for agencies to meaningfully reduce headcount in this way. Large-scale RIFs were subject to lengthy administrative and judicial appeal procedures that included three layers of review and often took years to complete. That is why fewer than 12,000 of the headcount reductions were executed through a RIF. We at the U.S. Office of Personnel Management have since revised these rules to make the process, including appeals, more efficient and to emphasize merit as the basis for determining RIFs. The old practice prioritized tenure.
