In Praise Of High-Priced Consultants
We are a social species, hardwired to keep a keen eye on what others have and to feel a twinge if they get more than us. Politicians know this. They may not have learned it in psychology class. But, oh, do they know it.
On Monday, Ontario NDP Leader Andrea Horwath complained that the Liberal government is paying economist Don Drummond $1,500 a day to find ways to cut costs. That is “eight times the pay of an average worker in this province,” she helpfully noted, “and nearly 20 times the pay of somebody making minimum wage.”
Look, everyone! That chimp is getting more bananas than you!
Now, I can’t read minds, but I’d bet 20 times minimum wage that Horwath doesn’t believe a word of this. She knows that good lawyers routinely charge $500, $600, or $700 an hour. Or more. Same for consultants of various sorts.
Hire a plumber for a full day’s work. An electrician. A mechanic. The bill may not be equal to Drummond’s, but it won’t be far off.
Then there’s Andrea Horwath’s salary of almost $160,000 a year. That ain’t minimum wage.
Horwath also knows that Don Drummond is one of the most respected economists in the country, with extraordinary experience in public service and banking. Drummond is the sort of guy who can get five figures for giving a canned speech. As a consultant, he can name his price in the corporate world. It’s astonishing he’s doing this work for so little.
But the most important thing Horwath knows is that attacking “high-priced consultants” is the political equivalent of celebrity gossip on websites: It’s sleazy, easy, and it always gets attention.
That is why these little scandals are so routine.
In September, it was revealed that federal finance minister Jim Flaherty had hired consulting firm Deloitte Inc. to find cost-saving efficiencies in government operations. The cost was steep: $90,000 a day. But the government expected Deloitte to produce such substantial results that it would end up spending $1 for every $200 saved. That is a good thing, one would think.
“Government should not be sole judge of the way it’s run,” Flaherty insisted. “We need advice from outside.” Coming from a minister whose government is infamous for ignoring external expertise, that was refreshing to hear.
But Flaherty was not praised. He was condemned. In the House of Commons, interim Liberal leader Bob Rae joked that Flaherty’s consultants would tell him he could save a lot of money by cutting out the use of consultants, which was a good crack the first dozen times a politician used it, but it lacks a certain something today.
Now, put those two incidents side by side. Notice anything odd?
Right. In September, a Conservative government was condemned by Liberals and New Democrats for hiring consultants. In November, a Liberal government was attacked by the Conservatives and New Democrats for doing the same.
This stuff is pure partisan hackery.
The government of Ontario is a $125-billion-a-year organization. It would be mismanagement verging on the criminally negligent for an executive to run such a massive enterprise without regularly seeking external advice. Every politician who has exercised power knows that. But, still, whenever governments do the right thing, we hear tut-tutting from the likes of Tim Hudak, Jim Flaherty’s old colleague, who claimed the Drummond contract is “awfully expensive for a job you’d think cabinet ministers and the premier would normally be doing.”
Of course this is not to say all spending on consultants is justified. It should be scrutinized, and condemned if necessary. But Premier Dalton Mc-Guinty was surely correct that governments need “wise advice on how we can manage government costs,” and to get that they have to pay market rates – or find saints like Don Drummond. Complaining about “high-priced consultants” may be an excellent way to appeal to our inner chimpanzee, but it’s silly, and politicians know it.
If this was only about hypocrisy on stilts, it wouldn’t be worth the words to condemn it. But it’s much more than that.
This stuff gives the public a distorted image of government, for one thing. In reality, the scale and complexity of the institutions that govern us is staggering. But these attacks encourage people to believe that a few sensible people can sit down, look over the books, and figure out just what to do. “Hey, I know! Let’s eliminate waste and duplication!” one says. “Right! And while we’re at it, let’s cut the fat!” another declares. “Stop the gravy train!” a third cries.
This is ignorant nonsense. No politician should promote it, but they all do, and it can come back to bite those who take power.
That makes politicians skittish, and it can be very bad for good governance.
Remember the story of David Rotor and Douglas Tipple? As Stephen Maher recalled recently on these pages, they were the two experts on procurement hired by the Martin Liberals – at a cost of $330,000 a year each – to find savings in the federal government’s procurement process.
Everything went well. Rotor and Tipple worked closely with the Conservative government when it came to power in 2006.
But then stories about supposed misconduct by the two were leaked to The Globe and Mail. The Conservatives panicked and fired Rotor and Tipple. In subsequent litigation, the allegations proved false and both men received major settlements.
And the savings they were to find? Rotor says they were on course for $1.25 billion a year.
But the planned changes were scrapped when he and Tipple were fired, so the government is out roughly $6 billion since 2006.
Who cares about that, right? Those two guys were getting $330,000 a year! Lenny Lunchpail can only dream of making that kind of money. That chimp has got more bananas than you, Lenny! Get upset!
Indeed, Lenny. Get upset at politicians who play to your worst instincts.