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The Honolulu Advertiser
Posted on: Wednesday, March 31, 2010

Layoffs can cost us more, long term

By Jerry Burris

State officials are perfectly right to look at ways they can cut, consolidate or otherwise shrink their budget.

Thus, one cannot get too huhu about the decision by Lillian Koller of the Department of Human Services to whack 228 workers and 31 regional offices out of her department's massive budget. Do more with less. Work smarter. That's the drill these days.

But there should be more of a long-range analysis of such decisions. Sure, there is "waste, fraud and abuse" in just about any system. Management experts will tell you it's possible to cut 10 to 20 percent out of almost any organization with no appreciable loss of productivity.

But the services provided by folks such as social service providers do not just cost money; they save money.

Anyone kept out of hospitals or the social service network (both of which are terribly expensive) is money in our pocket.

Thus, while Koller and her Cabinet colleagues need to "right-size" their operations, is anyone looking at the long-term costs?

Long ago, we set up an environmental impact statement system to measure the effect a given project would have on the environment and the general community. It is time for a similar system for operations spending.

If you dig into the state budget, you will find tables of "measures of effectiveness," that is, numbers of people served, etc. It is one way to figure out what those tax dollars are actually accomplishing.

But it goes deeper than that.

It may be asking too much, but what if there was a forward-looking analysis of, say, what the costs of closing a rural medical clinic really are? Yes, there are dollar savings, but surely there must be costs in terms of health quality, people diverted into far more expensive hospital emergency rooms for routine problems and so forth.

It may be in some cases that the cost far exceeds the gain.

The same thing applies in services such as early childhood education or obviously school furlough days. Yes, reducing preschool services or cutting down on school days saves money today. But what are the long-term costs?

Admittedly, this requires analysis and even speculation. When you cut a service, the hard numbers are there to see immediately. When you save a service, you have to project into the future when those who currently hold office might not even be around.

But isn't that what leadership is supposed to be all about? Balancing today's budget may mean leaving an even bigger budget gap for the next generation.