How Not to Make Government More Efficient

(Bloomberg Opinion) -- The Donald Trump administration is planning to move hundreds of federal jobs away from Washington. In principle, this idea could make sense — so long as it's competently executed and done for the right reasons. In practice, the plan seems likely to fail both tests.

As currently designed, the proposed relocations promise to yield meager, if any, savings to taxpayers. In addition, many of the workers concerned have vowed to quit, so the plans will cause serious shortages in valuable policy expertise. That's a net loss to the public. The White House should revisit the issue — and Congress should withhold funding for the moves unless it does.

In June, the administration announced that two agencies within the U.S. Department of Agriculture – the Economic Research Service and the National Institute of Food and Agriculture – will be moved to the Kansas City area. Employees were given 33 days to decide whether to relocate by Sept. 30, or lose their jobs; so far, nearly two-thirds of the 395 affected staffers have refused their new assignments.

The Interior Department, meanwhile, is transferring some 300 Bureau of Land Management employees out of D.C. to regional and state offices in the West. Its top 27 officials have been told to leave Washington by the end of September to run the bureau from Grand Junction, Colorado, where they will work out of temporary office space until new headquarters are built.

The impulse to decentralize the federal government isn't new. The country's founders dispersed important national institutions, including federal courts and the first Bank of the United States, to avoid concentrating power in the capital. Moving parts of the federal bureaucracy to places where office space and talent are cheaper has the potential to reduce public spending. It also allows citizens to interact with policy makers whose decisions affect their lives, which could in turn bolster trust in government.

So it's good news that the bureaucracy is not, in fact, conspicuously overcentralized: Just 15% of all civilian federal employees work in the Washington metropolitan area. Bearing that in mind, it's folly to undertake new relocations without thinking through the consequences.

The Interior Department estimates that the savings from moving the Bureau of Land Management will amount to just $50 million over 20 years, largely from reduced rent. But this will be offset by increased travel expenses — the bureau's leaders will still need to brief senior officials and lawmakers in Washington — and the costs of providing temporary housing for displaced staffers.

Moving the USDA's policy-research bodies to the Kansas City area is even less practical. The department's cost-benefit analysis predicts savings of $300 million over 15 years, including around $90 million in real estate costs. But it discounts moving into cheaper space in or near Washington; factor that in, and the savings in rent fall by nearly two-thirds. It also ignores the costs of losing dozens of policy experts — many of them Ph.D.s — and hiring and training new staff. An assessment by the Agricultural and Applied Economics Association concludes that moving the agencies would cost taxpayers between $83 million and $182 million.

That should be enough to make the administration think twice, but don't count on it. An exodus of senior officials probably appeals to a president who's promised to “drain the swamp.” Congress should take a broader view. It has limited power over the executive branch's decisions but still has an obligation to stop money from being wasted. It should block spending on these plans until the administration comes forward with competent cost-benefit analyses to support them.

Editorials are written by the Bloomberg Opinion editorial board.