Tech CEOs find $1 trillion in government savings
Technology CEOs are worried about the state of the Federal government. And they have outlined a strategy to drastically reduce the federal deficit over the next ten years.
The Tech CEO Council, a group made up of top industry CEOs, including Dell's Michael Dell, Intel's Paul Otellini, and Motorola's Greg Brown, has laid out an extensive plan that could help the U.S. government save $1 trillion over the next decade.
Dubbed "One Trillion Reasons," the initiative outlines seven areas where the U.S. government could cut costs or revamp its operational processes to save taxpayers money over the long term. The organization shared its findings with the Obama administration's economic team and the National Commission on Fiscal Responsibility and Reform.
"Our report contains straightforward, proven ways to pare back $1 trillion from the deficit while increasing productivity and enabling sustainable competitiveness," Michael Dell said in a statement. "We're serious about helping to provide solutions for the mounting debt crisis, and we're optimistic that changes today will help lay the foundation for future job growth and innovation for our country."
The council's plans are far-reaching and attack almost every aspect of the federal government.
First off, the organization believes the federal government should consolidate its many data centers to reduce IT overhead. Currently, the government's data centers cost approximately $76 billion per year, which the organization said could be reduced by 20 percent to 30 percent over the next 10 years. That alone could save the $150 billion to $200 billion over the next decade.
Secondly, the organization contends that the U.S. government should "streamline" its supply chain and make goods-and-service procurement more standardized. The group says such efforts could net the government $500 billion over 10 years.
Analytics also play a key role in the council's plan. According to the CEOs, $200 billion could be saved over the next 10 years by analyzing payments being disbursed through Medicare, federal grants, and tax refunds. In 2008 alone, the Government Accountability Office believes the U.S. lost $72 billion to improper payments. Analytics, the CEOs say, could reduce those losses significantly.
In addition, the council said the government should rely on "electronic self-service" to save $50 billion; sell or auction off many of the "14,000 excess, and 55,000 underutilized buildings in the federal inventory" for a $150 billion savings; cut down on energy use to save $20 billion; and migrate to more shared services for another $50 billion in savings.
Although ideas don't always return ideal results in practice, the council seems confident that its plans could drastically improve the U.S. government's financial standing. In fact, it estimates that its strategy could net the government $920 billion to $1.17 trillion over 10 years.
Not bad. But will the government follow those suggestions? Time will tell.
Correction at 5:08 a.m. PDT: This story initially miscast the range of savings predicted by the Tech CEO Council. The council says that its plan could result in savings of between $920 billion and $1.17 trillion.