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How Clippers' owner Steve Ballmer is trying to create the Wikipedia of government figures

With all that time on his hands after he retired as Microsoft CEO [not to mention all that money], Steve Ballmer began casting about for something new to do. He bought the L.A. Clippers a few years back, but he’s a numbers guy, a tech guy and a business guy. What to do with those three interests? He created USAFacts.org, which put economists, data experts and designers to work assembling all the numbers they can find about government getting and spending.

There are trillions of dollars out there, most of them already published somewhere. But USAFacts is working to put them all together on an easy-to-use website and to organize them so they make sense — a veritable Wikipedia of government money, useful, in time, for classroom curricula and for civic enlightenment. Because government isn’t a business, profits aren’t a yardstick of effectiveness, but outcomes could be, and that’s one thing Ballmer hopes USAFacts can offer. Whether they’re good or bad outcomes, he says that’s up to citizens.

In short, it’s about values, not judgments.

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What was the genesis of this, apart from the 800 on your math SATs?

I only had 790; just the facts!

I was talking to my wife about three years ago, when I first retired from Microsoft, about our nonprofit work, and she focused in on issues of child welfare and the like. She was saying, OK, you spent enough time doing this other job — now it’s time to help me in our philanthropic stuff.

I don’t know if it was some combination of being tired, or wanting time off, but, come on — when it comes to taking care of the less fortunate, particularly kids in need, the government does that. It helps the poor, the sick, the disabled, and all we should do is pay our taxes and support the government.

And her response was, “Not good enough.” And of course she was right. On the other hand, it made me want to say, “Hmm, I wonder if the government does do a good job of this?” And I went searching for information. I had a hard time finding what I was looking for. I thought it would be nice to find something like you can about a public company. Couldn’t find one.

I said, “How do we get that amount of data about how government takes in its money, where it spends it, and perhaps most importantly, what kind of outcome?” Because there’s no profit outcome the government is maximizing against; certainly there’s no way for any of us to say something has absolutely succeeded or absolutely failed because it depends upon your value set and the way you make trade-offs.

Even something like crime — there are aspects of crime where reasonable people can disagree over whether a drop in incarceration statistics is a good thing or a bad thing, if it’s related to certain offenses that people see in different lights. So what we chose to do wasn’t to say what’s right or wrong, but rather show the measures on which government reports, and then let people come to their own points of view about good and bad.

Take, for example, are Social Security and Medicare working? Well, you would evaluate that presumably on what the quality of life looks like for seniors over 65. And you have to put together a bunch of government data to be able to paint that picture — because without that picture, I’m not sure how anyone would assess the efficacy of Social Security and Medicare.

There’s of course a whole other thing we haven’t even touched, which is, with whom specifically does government spend its money? Not what does it spend it on, but who are the contractors and the like? A number of websites have tried to do a good job on [this], and some seem to have made some progress.

If you go to USAFacts, what can you find? And what do you want it to look like in a year, two years’, five years’ time?

What you can find today is a longitudinal view of how much the government raises in taxes and from whom, by family type and by income quintile, what the government spends its money on, again longitudinally. You go back, in most of these areas, as far as 1980. In some areas, the data is less available.

What does government spend its money on, by what I’ll call constitutional charter? The preamble of the Constitution lays out some distinct missions for government, and we just took those to be the definition: establish justice and ensure domestic tranquility, provide for the common defense, etc.

If you make them confront [their differences] in numbers as opposed to adjectives, people sometimes find they’re closer together than they thought.

— Steve Ballmer

We’ll show you where the money got spent and then, where possible, we’ll show you follow-on data on specifics of how the money’s being used, or outcomes.

What is happening to CO2 [carbon dioxide] emissions? What’s happening in terms of the number of crimes that people report, the number of arrests, the number of people who wind up in prison, how long they stay there?

What really is the quality of life for people pre- and post-income transfers coming from the government, like Medicaid or food stamps or some of the other social programs?

In most cases, we will show you things pre- and post-inflation adjustment, as a percentage of all spending. That’s the kind of thing you can find in USAFacts. You’ll find that written up in a linear narrative in something we call the annual report, a document that’s like a corporate 10-K.

Will this become a kind of Wikipedia of government figures?

That’s a reasonable way to think about it, as a Wikipedia of government figures. There’s a lot more information that we’d like to get in here. We’d like to show outcome data, down to the state, maybe even the county, city, maybe even school district level.

We hope to package the information so that as things become topical in the news, you can see an amalgamated set of relevant data on important topics of the day. And we can tweet that out and otherwise make that available through social means.

Were there any pieces of data that you thought were important that you wanted to include, but couldn’t find?

There were in a number of areas. Take the supplemental poverty measure — I think that one only goes back about 12 years.

If you really want to measure the outcome of the healthcare industry, to understand how many procedures of what form happen every year and then be able to detail the cost for each procedure or each disease type, we have to look harder. Or maybe that doesn’t exist.

Healthcare has emerged as the single largest spend-point in the U.S. economy, and the government heavily regulates healthcare. It pays for healthcare, and sometimes the whole structure of the industry is dependent on what government does. Having a complete understanding of the industry is important to understanding government’s role.

The number of guns in the United States — that’s not a statistic that’s captured, and yet we think it would be of interest. Whatever side of the gun issue you are on, it’s an interesting issue for people to understand how many people own guns, how many total guns are there out there, how many guns get sold every year. Some of that data is available. Some of it is not.

Is there a difference between how government keeps its books and how business does, given that each of them has a different goal?

Businesses use something called generally accepted accounting principles; government does not. Actually, that’s not true — some parts of government do and other parts do not, in some very important ways. When you build a new bridge, do you show all of the costs in one year? Or do you show all of the cash going out in one year, but then the cost is borne as the bridge gets used? This is a way it would be done in the private sector.

So there are ways in which I think it would be useful, if nothing else for comprehension, because more people understand business accounting than government accounting. On the other hand, most of the outcome measures of government — there’s just no equivalent properly represented in the business world. Something like an arrest rate or the number of people in jail — should you show the number of people in jail? Should you show the number of people in jail on one day? Should you show the total number of people who go through the system? Because you’re not measuring profit on these outcome measures. You have to decide what’s really important.

This is a nonpartisan site that’s all about information. But putting that out there supposes that what underlies some of the national rancor is a lack of information. Do you think that’s right?

Well, I might not say it exactly that way. My experience has been that people can get themselves very worked up about their differences, and yet if you make them confront [their differences] in numbers as opposed to adjectives, people sometimes find they’re closer together than they thought. Whether that will solve the differences or not, I don’t know, but it really can’t hurt to have both sides work with the same data set.

You’re a mathematician, you’re an economist , you’re a business guy, so you know the Disraeli line about “lies, damned lies and statistics.”

We really worked hard to provide context, historical context, context of other numbers the government is also doing. If you spend $10 billion on something, is that large or small? It depends on your perspective. So we will show you what that’s like as a percentage of government spend. People know what $10 billion means to them.

Now, can the numbers support differing points of view? Absolutely, they can. I’ll give you one example:

The number of household fires and the damage done is down quite dramatically over the last 37 years. Most people might say oh, that’s great, nobody can disagree with that. I’ll bet you can find people who will say, Hey, look: It’s because we’ve put such onerous restrictions on people in terms of product safety, the price of these products has gone crazy and the value in terms of reduced fires is not justified relative to the increased cost of products. It’s not an argument I would make or not make — I’m silent as to the point — but even on something that seems so genuinely good, and everybody can agree on it, I’m sure you see differences just because people make different trade-offs.

As you’ve been looking at the data your team has been collecting, what findings surprised you?

I’m not saying any one of them is good or bad. I’m just going to say they surprised me:

  • The mortgage interest deduction is to promote home ownership, and yet most of the value of the mortgage interest deduction goes to the top 20% or top 40% of people by income. The bottom 60% of people by income only take home 4% of the benefit of the mortgage interest deduction. I just found it surprising, given how I think about the rhetoric around the topic of mortgage interest deduction and home ownership.
  • As much as I know healthcare costs, I was still stunned by how high healthcare costs are, and how much they have risen. I think the last 15 years or 17 years, the average hospitalization stay has stayed about constant, around four days. The cost of that has risen by a factor of four-something — much faster than the rise of the rate of inflation. That surprised me.
  • Again, I draw no judgment on any of this stuff, but the level of CO2 production in the country has been relatively flat, neither up nor down over the last 10 or 20 years, call it 20 years. I might have thought it was up more dramatically or down more dramatically — that’s exactly what I would have thought from reading the newspaper.
  • I’ll give you one other that surprised me a lot, which is the percentage of kids who can read at grade level in fourth grade. Off the top of my head I’ll say that number is about 40%. I found it — I’ll go a step further than surprising — I found that very, very sad.

I’m thinking of a day when you have a candidates’ debate or something on the floor of Congress, and someone — a candidate, a member — will say, well according to USAFacts …

I’d love it. But you know what they’re really saying: according to the numbers published by the government of the United States. There’s not a number in there that wasn’t published by government, or a mathematical computation from numbers published by government. I’d be pleased for them to quote USAFacts. I’d be even more pleased if they used USAFacts to find the numbers and then they quoted the official government source that provides the information.

The reason why numbers are so good is that they’re not liberal and they’re not conservative, they’re not Democrat and they’re not Republican.

If you were grading how government keeps track of its numbers, how efficient it is insofar as you can tell about using its money? Is there a grade you would assign it?

In terms of how good it is about its numbers, I’d give it a B-plus or A-minus, for the amount of data that it collects. I’d give it a C-minus or less for its ability to put the numbers in a digestible and usable form that gives it real perspective and context.

The second question you ask is a little different: Does government use its money efficiently? I can’t tell you whether the screwdriver that gets used to build the warship is too expensive or not too expensive.

I will say, though, that when you look to the bulk of spending, I don’t sit there and say, “Wow, most of this money is probably wasted.” If you look at the people who work for government, most of the jobs are teachers, policemen, people who work in government hospitals — it’s hard to think of those as, quote, bureaucrats.

That’s a big part of the cost base. The second big part of the cost base comes from transfer payment. There’s one thing that’s true about Social Security and Medicare: They’re very efficient. If you’re trying to transfer money to a human being, they do it very, very effectively, very efficiently.

Some people will say, you shouldn’t be transferring the money, but that’s not an efficiency question. That’s an effectiveness and value judgment.

As far as the Clippers go, this one question: You’ve heard that people sit down at a slot machine, they play, they play, they play, they win nothing. They walk away. The next person comes along, sits down, one spin — wins the jackpot.

So here are Clippers fans in Los Angeles who’ve heard a question about whether the Clippers are going to move, and they feel like that: They’ve invested and invested and invested, and just when things are looking good … are the Clippers leaving?

Oh, no. That’s — I won’t say it’s a silly question, but it’s a silly question. I did notice it was a little bit out in the Tweetosphere recently, and I don’t really understand where it comes from.

I’ve been black and white, crystal clear: The Clips aren’t leaving L.A. If I wanted to take a team that I paid $2 billion for, cut the value by maybe as much as 50%, I’d move it out of L.A. because teams in L.A. are valued more. There’s just no chance we’ll leave Los Angeles.

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