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Wednesday, June 11, 2008

Shock in Washington: Private Business More Efficient Than Government

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The picture above is a shot of the Senate Dining Room, part of the government run Senate Restaurants, and it looks pleasant enough. Sadly that is the only nice thing that can be said about it. In a story embarrassing to Democrats because it shows how poorly the government performs in comparison to the private sector, the degree of the failure is instructive about more than just restaurants.

Year after year, decade upon decade, the U.S. Senate's network of restaurants has lost staggering amounts of money -- more than $18 million since 1993, according to one report, and an estimated $2 million this year alone, according to another.

The financial condition of the world's most exclusive dining hall and its affiliated Capitol Hill restaurants, cafeterias and coffee shops has become so dire that, without a $250,000 subsidy from taxpayers, the Senate won't make payroll next month.

The embarrassment of the Senate food service struggling like some neighborhood pizza joint has quietly sparked change previously unthinkable for Democrats. Last week, in a late-night voice vote, the Senate agreed to privatize the operation of its food service, a decision that would, for the first time, put it under the control of a contractor and all but guarantee lower wages and benefits for the outfit's new hires.

The House is expected to agree -- its food service operation has been in private hands since the 1980s -- and President Bush's signature on the bill would officially end a seven-month Democratic feud and more than four decades of taxpayer bailouts.

Sen. Dianne Feinstein (D-Calif.), chairman of the Rules and Administrations Committee, which oversees the operation of the Senate, said she had no choice.

"It's cratering," she said of the restaurant system. "Candidly, I don't think the taxpayers should be subsidizing something that doesn't need to be. There are parts of government that can be run like a business and should be run like businesses."

The difference between the private and public systems is made apparent by the behaviour of the (imagine this!) marketplace.
In a masterful bit of understatement, Feinstein blamed "noticeably subpar" food and service. Foot traffic bears that out. Come lunchtime, many Senate staffers trudge across the Capitol and down into the basement cafeteria on the House side. On Wednesdays, the lines can be 30 or 40 people long.

House staffers almost never cross the Capitol to eat in the Senate cafeterias.

"It's so bad that the Senate hasn't yet figured out that House 'Taco Salad Wednesday' trumps any type of entree they have to offer," said Ron Bonjean, a former press secretary to both the House speaker and the Senate Republican leader.

"Those who think the House and Senate don't talk enough clearly haven't been in the Longworth cafeteria on the House side at lunchtime recently. Senate staffers have been flocking there for better food, more options, and you get some exercise to boot," said Brian Walsh, spokesman for Sen. John Cornyn (R-Tex.),who frequently dines on the other side of the Capitol.

And of course that consumer satisfaction is borne out on the bottom line. While the government run system has lost more than $18 million since 1993, as noted above, the...
...Restaurant Associates turns a substantial profit -- paying $1.2 million in commissions to the House since 2003. Company officials did not return telephone calls seeking comment.

You might think that this little lesson on the benefits of capitalism might not only make Senator Feinstein blush a bit but might also make her reexamine some of her long-held liberal economic assumptions. But don't count on it. Her liberal power base is certainly not interested in her making reasonable policy decisions. They and she are about power first and foremost. Even this small step seemed like it caused her physical pain.

Now if only we could get everyone to take note of this situation and then realize that these government folks are the same ones who now want to take over health care.

Outside The Beltway also notes

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