|Congressman Mike Pence|
In attending the conference yesterday though I was interested in seeing what type of person Mike Pence had become since leaving law school. Although his political career fizzled initially, Pence was eventually elected to Congress and quickly challenged more moderate Republicans. The challenge succeeded and Pence was elected to the leadership of the U.S. House. He played a major role in pushing the Republican caucus in the House to the right.
Being governor though is far different than being a legislator. A governor's responsibility is to not only to set a legislative agenda and balance the books, but also to act as chief administrator of the state's bureaucracy. While Pence has the advantage of following in the footsteps of the very popular Mitch Daniels, I thought very possibly he'd fall into the trap of simply campaigning with the promise to extend the Daniels legacy.
During his speech though Pence made it clear, that while he admired what Daniels had done in his eight years, he would be his own man and would make a priority of revolutionizing how Indiana's often unwieldy and inefficient bureaucracy operates.
That was music to my ears. While I very much liked Governor Daniels' legislative agenda and his steadfast determination to hold the line on spending, especially on the perpetual increases in education spending, I always felt Daniels' Achilles' heel was administration and oversight of the agencies. When Daniels turned to making state government more efficient, he naturally drifted to privatization, a reform that first became popular with conservatives in the early 1990s. Unfortunately, the last two decades have taught us the limit of privatization. Giving a business a monopoly to provide services to the public with a long-term contract, does not result in efficiencies...a fact the Medicaid debacle proved all too well. Not every government service is done better by the private sector, another fact proved by Medicaid privatization. Outside of Daniels' interest in privatization, he didn't seem terribly interested in state government reorganization. Worse yet, many of the agencies suffered from poor leadership while warnings from whistleblowers about problems at several state agencies went unheeded by the Governor's staff until they blew up onto the front page of the newspaper or the evening news.
According to a poll just released today, Pence has an 18 point lead over John Gregg. Assuming that lead holds up, and I think it will, the Congressman turned Governor will be presented with a unique opportunity to build on Daniels' legacy by doing a comprehensive restructuring and reorganization of the state's bureaucracy.
It is a task that needs to be done. I can give as an example, one I know best, is how Indiana regulates players in the real estate industry. As former head of Indiana's Title Insurance Division, we had to deal with a number of agencies when it came to regulating the real estate transaction. We regulated title insurance agents and companies, though most of our work involved regulating the closing transaction. The Attorney General regulates appraisers and real estate agents. The Department of Local Government Finance regulates mortgage lenders. The Secretary of State regulates mortgage brokers. Then you have federal and state law enforcement officials who might be involved if the real estate transaction involves fraud or some other crime.
The current regulatory structure leads to horrible inefficiencies. You often had investigatory work being duplicated, multiple files on the same matter, or the information not being shared between the agencies. Then you had a problem of the lack of expertise. I met with a couple new attorneys from the Secretary of State's office about an investigation of a broker who they were convinced had paired up with a title insurance agent to do something unethical if not illegal at a real estate closing. They were very sincere in their efforts, but it was clear they just didn't have the experience necessary to understand how real estate closings in Indiana work. In actuality what the broker and agent had done was common practice and certainly not unethical or illegal. That scenario was repeated with law enforcement officials and prosecutors who simply don't have the experience to understand real estate enough to prosecute individuals for mortgage fraud.
This situation could be addressed by Indiana establishing a Real Estate Commission, putting the regulators of these real estate players into one agency. That would help eliminate all the inefficiencies involved in real estate regulation. Further, a REC would have the comprehensive expertise to offer assistance to county prosecutors wanting to go after mortgage fraud and other real estate crimes in their communities. If Indiana adopted this type of reform, it would be THE state leader in rethinking regulation of real estate.
FYI, I've written on the need for real estate reform before:
Sunday, October 5, 2008, Consolidating Real Estate Regulation in Indiana - Where Do the Governor and Attorney General Candidates Stand on the Issue?
For Pence to succeed as an administrator, he needs to be willing to take a different approach than his predecessor. Part of that not only involves enlisting people with creative minds uncolored by self-interest in making a buck off state government, but also enlisting the state employee workforce a full partner in the reorgnization effort. A Governor Pence needs to be thorough in interviewing individuals being considered for department heads and needs to insist that his staff listen to and act on the complaints of state employee whistleblowers ...and protect those individuals' jobs when they risk their jobs by blowing the whistle.
Can Pence succeed as an administrator and lead a revolutionary reorganization of Indiana state government. I think he can. Whether he will is a story yet to be told.