The Office of Management Budget released Friday a plan to reform and reorganize the government, laying out a strategy to merge the Labor and Education departments, collapse the nation’s 22 financial literacy programs, address the cyber workforce challenge and privatize Fannie Mae and Freddie Mac.
The 132-page executive order, entitled “Comprehensive Plan for Reorganizing the Executive Branch,” states that it “builds on a history of bipartisan government reform initiatives,” and seeks to reduce “duplication and redundancy,” and improve “efficiency, effectiveness and accountability of the executive branch.”
The Trump administration states that the report is designed to serve as a “cornerstone to build productive, bipartisan dialogue” to bring the government into the 21st century.
As Ed Mills, policy analyst for Raymond James, notes in his Friday Washington Policy briefing, “many of the administration’s proposed changes will require congressional action,” which Raymond James views as unlikely this year heading into midterm elections.
Collapsing the Labor and Education departments as well as taking action on Fannie and Freddie are two such measures that need congressional approval.
Mills notes that a path forward on housing finance reform “has been an ongoing discussion in both the House and the Senate, and is likely a key policy area to watch in 2019.”
In the near-to-medium term, Mills continued, “first steps on reform can be initiated by President Trump’s pick to lead the [Federal Housing Finance Agency], starting with an end to Fannie Mae and Freddie Mac’s conservatorship status.”
Merging Labor, Education
The plan would merge the Departments of Education and Labor into a single Cabinet agency, the Department of Education and the Workforce (DEW).
“Merging ED and DOL would allow the federal government to address the educational and skill needs of American students and workers in a coordinated way, eliminating duplication of effort between the two agencies and maximizing the effectiveness of skill-building efforts,” the report states.
As it stands now, the two departments “operate in silos, inhibiting the federal government’s ability to address the skill needs of the American people in a coordinated manner.”
The result: “a complicated web of funding streams for states and localities to administer, and a confusing set of signals sent to American students and workers regarding how best to develop the skills needed to succeed in the 21st century economy,” the report states.
The federal government currently operates more than 40 workforce development programs spread across 15 agencies. “This fragmentation perpetuates unnecessary bureaucracy and complicates state and local efforts to weave together disparate funding streams to meet the comprehensive needs of their citizens.”