March 16, 2016
Hon. Marsha Blackburn
7th District of Tennessee
2266 Rayburn Building
Washington, D.C. 20515
128 North 2nd Street
Clarksville, TN 37040
305 Public Square
Franklin, TN 37064
BY FAX, E-MAIL AND MAIL
Dear Congressman Blackburn:
Thank you for your service to the people of Tennessee. It is much appreciated.
I am writing today to offer a suggestion of something you and your staff can do to help revitalize local markets, create private jobs and income in Tennessee communities – and communities throughout America – and reduce our national budget deficit.
This suggestion will require no new laws or regulations and no new appropriations. It can be done within the existing administrative resources of federal agencies. Despite the minor expense involved, it can make an important contribution to reviving local and regional markets and economies.
In Latin America, when the economy was restructuring and government budgets had to change, citizens implemented a process called participatory budgeting. The first full participatory budgeting process was developed in the city of Porto Alegre, Brazil in 1989.
The idea was for citizens to take responsibility to ensure that precious government resources were well used.
One of the challenges of implementing a participatory budgeting process in the United States is that it is difficult to find and aggregate the necessary data about government resources (tax and fee collections, appropriations, credit programs, asset inventories, mandates and regulations) in any given county or Congressional district.
Currently, in addition to the US government publishing a national budget and financial statements, states, municipalities and other government entities are required to publish the Comprehensive Annual Financial Reports or “CAFRs.”
Comprehensive Annual Financial Report (CAFR)
However, there is a great deal more that the federal government could do to ensure that citizens can access, understand and aggregate tax, financial, credit and program data about their communities.
Items essential to such an effort include:
1. Accessing the federal tax collections, budget and financial statements for each federal agency on a place- based basis – by state, county and congressional district.
2. Accessing data on outstanding federal portfolios of assets and credit liabilities on a place based basis. For example, this would permit community-wide strategies to deal more effectively with federal defaulted loans, mortgages and foreclosed asset dispositions held by numerous agencies and funds.
3. Accessing program data on a place-based basis. Combined with (1) and (2) above, this helps analyze performance and identify opportunities for reengineering.
4. Accessing contract budgets for each agency, including scope of work, data on where the relevant work force is located and for what places services are produced. What the data will show is that there are numerous reengineering opportunities where decentralized local businesses can compete effectively to do contracting at a lower cost than current centralized contracting. This includes services that when done locally will reduce the cost of government unemployment compensation, housing subsidies and food stamps.
5. Making data available in GIS and other graphical software that makes financial and quantitative data and program impact more intuitive and understandable to busy citizens.
If you look at the resources in the offices of agency chief financial officers or the budget offices as well as the webmaster function, the agencies have the capacity to provide this if the political will exists to bring transparency to federal finances. Certainly, the Office of Management and Budget has the capacity to encourage or require such efforts.
This idea has been proposed and tried before, including when I worked in the Bush Administration and as an advisor to the Federal Housing Administration in the Clinton Administration. Among other problems at that time was that federal government financial transparency would have prevented the housing bubble at a time when federal mortgage credit was creating an increasing amount of economic activity.
However, debt growth by sovereign governments and quantitative easing by central banks are coming to an end. This presents an opportunity to refocus on fundamental productivity. Consequently, the pressures now facing the federal finances and the need to reengineer the US budget to reflect changes in our economy may create an environment more open to federal financial transparency and citizen participation.
Federal financial and program transparency organized contiguous to the world that citizens experience personally in their day to day lives or the areas from which they vote for legislative representation– their county or their Congressional district – will provide essential raw material for citizens and local enterprise to dig in and work together to revitalize local economies and build family wealth.
If I can answer any questions for you and your staff or provide examples and greater detail, I would be happy to meet with you by phone or in your Tennessee offices.
Again, thank you for your service to the 7th District and the people of Tennessee.
Catherine Austin Fitts
CC: Hon Marcy Kaptur, US Congressman, Ohio 9th District 2186 Rayburn Building
Washington, DC 20515 Tel : (202) 225-4146
Fax: (202) 225-7711