How our flawed debates about cost prevent us from spending public money wisely

Barely a news cycle goes by these days without someone in public office saying ‘We can’t afford that,’ while at the same time defending their favorite budget priorities and tossing around mind-numbingly large cost figures in the billions and trillions of dollars. Those debates can seem very cynical, and of course Oscar Wilde famously defined a cynic as a person who knows the cost of everything but the value of nothing. But Harvard Kennedy School Senior Lecturer Linda Bilmes says things are even worse than that—not only are we not having discussions based on value, our understanding of what projects and policies actually cost is fundamentally flawed.

A former CFO of the US Commerce Department and an internationally known expert in public budgeting and finance, Professor Bilmes has made it her mission to change the conversation about cost in the public sphere, and she’s helped identify the true costs of everything from America’s wars in Iraq and Afghanistan to our National Parks to the automobile economy in Massachusetts. She joins us to talk about her efforts to improve both the discussions and the decisions that are made about public money.

About our guest:

Linda J. Bilmes, the Daniel Patrick Moynihan Senior Lecturer in Public Policy, is a leading expert on budgetary and public financial issues. Her research focuses on budgeting and public administration in the public, private and non-profit sectors. She is interested in how resources are allocated, particularly defense budgets, costs of war, veterans, sub-national budgeting and public lands. She is a full-time Harvard faculty member, teaching budgeting, cost accounting and public finance, and teaching workshops for newly-elected Mayors and Members of Congress. Since 2005, she has led the Greater Boston Applied Field Lab, an advanced academic program in which teams of student volunteers assist local communities in public finance and operations. She also leads field projects for the Bloomberg Cities program. Dr. Bilmes served as the Senate-confirmed Assistant Secretary and Chief Financial Officer of the U.S. Department of Commerce under President Bill Clinton. She currently serves as the sole United States member of the United Nations Committee of Experts on Public Administration (CEPA), and as Vice-chair of Economists for Peace and Security. She serves on the Board of Directors of the Institute for Veterans and Military Families at Syracuse University. She was a member of the National Parks Second Century Commission and served on the U.S. National Parks Service Advisory Board for eight years. She is a member of the Council on Foreign Relations and a Fellow of the National Academy of Public Administration. She holds a BA and MBA from Harvard University and a D.Phil from Oxford University.

PolicyCast is a production of Harvard Kennedy School and is hosted by Staff Writer and Producer Ralph Ranalli

PolicyCast is co-produced by Susan Hughes.

For more information please visit our web page or contact us at PolicyCast@hks.harvard.edu.