cc >> Jeanan Yasiri: This is
Entrepreneurship in Society. It's a course offered through
the University of Wisconsin School of Human Ecology.
I'm Jeanan Yasiri. As we begin today, I'd like to
extend thanks to our partners in supporting this course: the UW
Office of Corporate Relations, the UW College of Engineering
for their technical support, and financial support from the Ewing
Marion Kauffman Foundation which is committed to advancing
academic education in entrepreneurship.
Additionally, we'd like to thank our media partners, Wisconsin
Public Television and their University Place crew for taping
today's lecture. I'm quite pleased to introduce
Katherine Sydor today, a master's candidate of Public
Affairs at the LaFollette School of Public Affairs here at
the University of Wisconsin. Katherine was born and raised
here in Wisconsin, attending high school in Hartford before
heading to Minnesota for her undergraduate work in history
and women's studies. In 2006, she packed up and moved
across the country to Washington, DC, to learn more
about the nation's federal government, inspired by the
possibilities to advance the cause of social justice on a
national scale. For two and a half years,
Katherine served in the office of Wisconsin representative
David Obey, who represented the northwestern corner of our
state. And after that she joined the
office of freshman senator Jeff Merkley from Oregon, assisting
in constituent relations and appropriations.
This fall we are fortunate that Katherine returned to her roots
here in Wisconsin and is now pursuing her masters degree in
public affairs at the University of Wisconsin Madison where the
concentration of her work is on social and economic justice.
She also serves as the project assistant with the UW Center for
Nonprofits. Please join me in welcoming
Katherine as she talks with us about entrepreneurship and
public policy. [APPLAUSE]
Katherine Sydor: Thank you, Jeanan.
So today we're going to talk about public entrepreneurialism,
which you will see, through the course of the lecture, is very
closely related to social entrepreneurialism, which Jeanan
already talked about earlier in the semester.
Public entrepreneurialism, though, is the generation,
translation and implementation of new ideas into the public
sector. So in order to understand the
concept of entrepreneurialism and how it interacts in the
world of public policy, we have to understand what is public
policy. So we need a definition there.
We touched on this a few weeks ago when we talked about the
Wisconsin Idea. What should and probably does
come to mind is government. Government.
So the practice of governance. We elect representatives to
create public policy by passing laws and regulations, but public
policy is more than just our elected representatives.
It's the people behind the counter at the DMV, and it's the
street level bureaucrats that you interact with on a
day-to-day basis. And it's also the tax breaks
that we give to small businesses to sort of spur innovation and
development. In the nonprofit community, some
of you are more familiar with that than others maybe,
nonprofit organizations many times provide the services to
vulnerable populations that are either in conjunction with or in
partnership with the government or they might be in place of
what some people might think that the government should be
providing. So that's an important thing to
keep in mind. Think about some of the people
that we've already heard from this semester.
Think about some of the people that you've watched on your web
links and how they relate to this idea of entrepreneurialism
in the public sector through their work in nonprofits.
So then the third idea is the idea of contracting, and this is
sort of where these nonprofits relate with government through
partnerships. And the contracting out of
certain government services adds another layer of complexity to
this idea, the relationship between people, their
government, and public policy. Important questions come up when
government begins to contract out these essential services.
Do we want people providing social services that are
concerned about a bottom line over anything else?
Or do we want people or bureaucrats with sort of a
public service motivation handing out whether it may be
food stamps or your driver's license or what have you.
NGOs are another way to describe nonprofits, although usually the
term NGO is used in conjunction with international
organizations. So I just want to give you one
definition, but obviously there are many.
This one is from Dean Kilpatrick who worked at the National
Violence Against Women Prevention Research Center.
In any society governmental entities enact laws, make
policies and allocate resources. The allocation of resources is a
really key point to keep in mind here.
This is true at all levels. Public policy can generally be
defined as a system of laws, regulatory measures, courses of
actions, and funding priorities concerning a given topic
promulgated by a governmental entity or its representatives.
So let's just think about that, read it over a second time
because I know this is possibly a new concept to many of you.
Specifically remember that the allocation of resources is a
big, big part of the policymaking process.
How much funding is going to go towards roads?
How many funding is going to go towards education or building
schools? These are increasingly
complicated questions in an age of lower tax revenue, and we've
got these large budget deficits at all levels of government.
You've been hearing a lot about that on the news right now.
We hear a lot about the national deficit on the federal level.
So what is important to you in the public policy arena?
Try to think to yourselves right now.
Is it education? Is it environmental issues?
Is it renewable energy? Is it greater freedom from
government regulation? It could be a whole host of
things. Now, think about whatever it is
that you just thought of in your head, whatever it is important
to you and try to think about how you need to make it
important to everybody else as well.
So you've got your values, you've got your thing that you
think is the most important thing in the budget, how do you
make everyone agree with you, and that's the problem with
public policy is trying to get everybody on board with your
idea so that it actually can come into play, whether it be at
the state or federal level. It's an extremely complicated
process making policy. So taking a good idea about an
important issue and turning it into a law much less a law or
policy that fulfills its intention.
A lot of times laws are written and a couple years down the
road, everybody kind of steps back and was like, whoa, that
didn't do at all what we thought it was going to do.
So the implementation process of public policy is really
important as well. This is where we might start to
see, this sort of long, arduous process of making policies, this
is where we might start to see some areas where
entrepreneurialism could come into the conversation.
And that's where I want you guys to start thinking about all the
concepts that we've been talking about in this class thus far,
now that we know what public policy is, and try to see how we
can sort of marriage the two. So a policy entrepreneur might
come into the state arena, whether it be the state
government, local government or the federal government, and they
have to have a great idea, first of all, but they have to have a
new and novel way of presenting it to everybody.
And then that might eventually end up in a functioning policy.
So are there any questions about what public policy is before we
move on?
So I want to get us thinking a little bit more about how this
sort of affects your every day lives and take a few minutes to
brainstorm here. Try to think about what you've
done today since you've gotten up.
How is the government or a nonprofit or maybe a specific
law of public policy, how has that affected your life today?
So everybody take out a sheet of paper and just try to brainstorm
four or five ideas. If there are any questions about
what I'm asking, please let me know.
I'm going to call on people in just a couple minutes so try to
have some answers prepared.
Okay, has everybody had a moment to think?
Does anybody want to volunteer to be the first one?
You can just shout it out, and I'll repeat it for the
recording. Sure.
Yeah. >> Me?
Yeah, sure. >> I had to call the Dane County
Courthouse today. >> You had to call the Dane
County courthouse. >> Yeah, to talk to someone
about a ticket. >> Talk to someone about a
ticket, great. That's not always a fun
phone call to make, right? How else have people interacted
maybe a little less directly with their governments today?
Sure. [INAUDIBLE]
Yep, so she said that she walked here today using the
sidewalks, the traffic signals, the roads.
Did anybody take the bus to school today?
Okay, there's public policy. The City of Madison had to come
up with a transit plan. We have a pretty good public bus
system, I think, in Madison here, even though today they may
have been running a little bit late because of the snow.
What else in regard to the snow is related to public policy?
Which is really important to all the voters in Madison, right?
Who knows what I'm talking about?
What? [INAUDIBLE]
Snow plows, right? This is always a huge election
issue to us Wisconsinites. Anybody have anything else?
What are we doing right now? We're in class, right?
Where does a big chunk of the funding for this university come
from? State, right?
State government. If you all watched Mike
Knetter's, the web link for today, he talked a lot about
where the funding comes from for being here with all of you
today. So this classroom, a lot of
different things came together, all related to public policy.
So just wanted to get you thinking about that, and maybe
you can sort of connect what I'm talking about to your lives.
So now that you've got your idea in your mind of how public
policy influenced your life today, I want you to try to
consider how that decision, how the buses, how the sidewalks,
how the university, how all of those things came into being.
What had to happen to make the bus come and pick you up at the
bus stop today? For example, the sidewalks,
somebody needed to decide that there needed to be sidewalks in
your neighborhood. And most of Madison I think has
probably got those, but it wasn't always like that.
There was a point in time when the elected representatives,
through the wishes of their constituents, decided that they
needed to implement something where people could have
sidewalks on the side of the street so that they could walk
safely from here to there without being in the road
getting hit by a car. So it's a public safety issue,
right? So there are a lot of people
that always need to come together to make things happen.
There's the city council people, there's your local and state
representatives, there are your federal representatives, and
sometimes those jurisdictions overlap and all of these people
have to work together. Sometimes it's just a local or
just a federal issue, and they sort of work within their own
policy arenas to make something happen.
So it's really difficult to actually make a change in the
public policy sphere. And there are some reasons for
that. The framing of our Constitution,
one of those reasons, makes it really hard to implement a new
law, or to pass a new law, not necessarily implement it.
There are a lot of different channels one needs to go to.
To get a law changed, you've got to get the right people on your
side, you've got to build the coalition, and then you have to
think about if you're on the federal level and you actually
want to do something as big as amending the US Constitution, it
takes two-thirds of each house of Congress to pass a law to
amend the US Constitution. And that's an incredibly
difficult thing to get, and, like I said, it's difficult for
a reason. So it's a very tall order.
And sometimes these restrictions to getting something changed in
the public policy arena, they take something a little bit
extra special. They take somebody with that
entrepreneurial spirit which we've been talking about all
semester long. So one of the other things that
I wanted to talk about with you guys really quickly is, who's
taken micro econ in this class? So about half of you are going
to immediately recognize what I'm talking about.
I didn't take econ when I was an undergrad, and any of you who
haven't take be it I would strongly, strongly suggest
taking it because I've finally taken it as an graduate student
and I think it's changed the way I look at a lot of things for
the better. So public goods, in economics
public good is used to describe something that is non-rivalrous
and non-excludable. What does that mean, right?
It's sort of a weird way of saying something.
So something that's a public good cannot be consumed by any
one person, and no one can be excluded from using it.
So that's not so hard to understand, right?
It's like these big things that everyone has access to.
So what does the Department of Defense and what does clean
water, what do they have in common?
Well they're both public goods. Let's think about it.
We all benefit from the Department of Defense.
We can have reasonable disagreements about what exactly
that means, but on a very basic level the Department of Defense
is our national defense system. Whether we like it or not, we
all benefit from it. And it's not like what the
Department of Defense does runs out at a certain point.
It's not like if they protect me, they can't protect you.
Because it's something that happens on such a big vast
scale, they can't exclude any one person.
Same with water. If our water is polluted or used
up, it affects all of us, right? No one has complete control over
all of it. So the problem from an
economist's point of view is that both of these goods don't
really have a market for them. So people might not adequately
value when they use these things.
So they might not want to pay for the Department of Defense
and they might not want to pay to clean their water or they
might not interact with the market in an adequate way to
show what the value is of having clean water.
So that's a really basic definition of a public good.
I'm sorry if that was like overly basic for some of you.
And like I said, if that seems interesting to you, you should
take an econ class. At any rate, the point is
that these types of goods are really only noticeable to us
when they aren't available in quick and easy supply.
And so when these things aren't provided but we all need and
benefit from them it's called a market failure.
And this is where government can come in and play a role in
providing us with adequate defense and clean water and
clean air. You hear a lot about this in the
news. What this actually means by
different laws and regulations restricting the use of
pollutants in our water or the appropriations that number in
the billions for our national defense system every year.
When I was doing research for this lecture I came across this
graphic online that outlines the public policy process.
And I just want to caution you that this is a really, maybe not
overly simplistic but this is what happens in an ideal world,
and as you all know we don't live in an ideal world, but this
is the general idea of how something comes about in the
policy arena. So try to think about the issue
that you thought about a few minutes ago, your example of how
public policy influenced your life today, and think about how
it went through this process to become the sidewalk that you
were walking on or the bus that you were riding on or whatever
it is.
I think we've got the sufficient background down to sort of
understand the meat of what we're going to talk about today
which is entrepreneurialism in the public policy process.
So now let's talk about the three different ways that I
think we can look at entrepreneurialism in public
policy. So let's try to take a step
back. There are three major concepts
here that I'd like us to sort of break down and discuss a little
bit further. Number one, government can
function in a way that some might call entrepreneurial.
It might take risks sometimes. And we might classify that as an
entrepreneurial venture. Think about the push for
efficiency in government when considering this perspective,
this first one. Number two, government can
encourage entrepreneurialism through public policy.
Clause, regulations. For example, lower taxes and
subsidies for all sorts of economic ventures, companies,
encouraging small businesses or building a major sports stadium
to encourage businesses to come to a city.
That's sort of an example of what I'm talking about here.
And number three, within government there might be people
who act in ways in which we would recognize as
entrepreneurial. So these can be bureaucrats or
elected officials or they might be movement leaders outside
government pushing for some kind of change.
Think Martin Luther King, Jr. So let's start with the first
one. Entrepreneurialism in
government. Public entrepreneurs are
particularly concerned with increasing government's capacity
to respond to issues of quality of life.
The innovative approaches taken by certain municipalities to
addressing major issues such as affordable housing, recreation,
open space, land use planning, and poverty.
They all show an entrepreneurial spirit at work.
So public entrepreneurs can bring more efficient ways of
doing things, creativity. They might bring new information
to the table that somebody else who had been working there for a
long time hadn't really thought of or they might act on new
information. They might actually put in
place, they might implement a new idea.
They might organize resources in a new and sort of crazy
innovative way to try to get a better outcome.
Another way that this can happen is if they spread out the
decision making process. That's a very entrepreneurial
way of looking at things. And they make the central
decision making, kind of ease it a little bit.
So there's not just one person up on high dictating down the
pyramid. So the important thing to
recognize here is that the bottom line for government is
very different, it's analogous to business but it's very
different in some important ways.
It's not the same. Poverty reduction, education,
trash collection, they can't be evaluated in the same way that
private businesses are when they're trying to make a profit.
So after the midterm elections last November and obviously I
think everyone on campus has heard about the controversy up
the street with Governor Walker's budget repair bill and
his budget proposal for the next biennium, this is a really
important topic to about in light of these things because
the people who came into power in November, they really
campaigned on this idea of less government, less red tape, less
regulation. And so you probably heard about
the tea party, they're having a really big impact in Washington,
DC, right now. The budget for this fiscal year,
fiscal year '11, still has not been passed.
And one of the reasons is because the tea party members of
the republican caucus are really opposed to government spending,
and they want to cut a lot of money out of the budget for this
year. And they're refusing to vote on
anything that doesn't cut anything, I think it's like $60
billion from the current budget. So this is a really important
issue that's affecting all of our lives right now, both state
level and federal. So it's important that we
recognize what's really at play here and what exactly they're
talking about when they talk about less government.
So a lot of people argue that government needs to be run more
like a business and that there's too much red tape, too much
bureaucracy. And this is one idea, the sort
of solution to this criticism is where entrepreneurialism can
come into play. So before we get into that,
let's talk about the differences between government and business.
We touched on this a slide ago, but let's get into a little bit
more detail of what I mean here. How is government different?
Does anybody have any ideas of how government is different from
the way a business works? I'll just give you a second to
think. Mm-hmm?
It should be, well, since you said government is for people
who, public goods are for people who can't, like for everyone,
businesses don't create products for everyone.
[INAUDIBLE] >> Right, yeah, exactly.
So she's saying that the government creates goods for
everyone. In many cases that's true.
Businesses create goods that are for one person who's going to
pay for it, right? Sometimes we pay for government
services, but really in the end the taxpayers are paying for
most of it. Does anybody have any other
ideas of how government might be different.
Seamus? >> Businesses are looking out
for the people who own businesses.
[INAUDIBLE] The business has its best
interest of what they're trying to pursue.
The governments are trying to serve the people.
So it's more of what the better interest of the people using the
things instead of the people who own the business.
Yeah, that's a great distinction.
So he's saying that one of the differences between government
and businesses is that government is more about the
consumer, right, the customer. The person who's consuming it
they want to make sure that they've got everything they need
to be happy. And in business there may be
this idea that you need to take care of your customer, and I
think a lot of the people have come into this class
specifically and talked about how important that is, but at
the same time their bottom line is to their shareholders.
It's usually about making profit.
So there's a very important distinction there.
And I don't mean to put this in sort of black and white, that
there's some sort of value judgment on either of those
things because there's not. And it's important that we kind
of maintain a clear head about that.
There's not a value judgment on this.
But it is important to recognize the distinction between the two
so that you can recognize the incentives that each one has to
provide a particular good. Okay?
So here's an example. When GM, General Motors Company,
wants to invest in an auto plant, they can sell some
shares, they can get some money, and then they can go and make
their investment. When the Department of Defense
wants to make a new investment, they want to buy a new F-16
bomber or some big billion dollar piece of military
machinery, what do they have to do?
Can they just go buy it? No.
They have to go to Congress. They have to go to the Defense
Appropriations Committee. They have to ask them for the
money. The money gets to be debated
about in the committee, it gets to be debated about on the
national level whether we should be spending money as a country
for this. It goes through all kinds of
different iterations, all kinds of people with all different
interests get involved in the debate.
And then maybe they'll get their money, but they have to spend it
in a certain place and they can only buy 10 and maybe they
wanted 20. There's a big difference between
how a government functions, how our government functions even on
these sort of like localized departmental levels and how a
business can function. And the Congress men and women
who make decisions about these appropriations are our elected
representatives, and they don't necessarily make decisions that
are best for the country overall.
This is sort of one of the big problems in representative
democracy. We have all these elected
representatives, but they're voted their specific
constituents' concerns from this little tiny piece of Wisconsin.
They're not talking about the big picture of the entire
country, nor are they talking about the big picture of the
entire country 50 years down the road.
So a lot of times we're hearing about the deficit and oh, my
gosh it's so bad, it's so bad, it's so bad, but why aren't our
representatives doing anything about it?
The incentives for them to do anything about the deficit
aren't really there for them on a local level.
It might be better for us because we're going to be around
in 50 years, it might be better for us if they took care of the
deficit problem now, but we've got to get out there and vote
because they're not voting for our concerns.
They're voting for the immediate concerns of the people who get
out to the elections in their district, the last election.
And that always doesn't get the right things for us in the long
term. Another thing that you should
also remember is that businesses, a lot of them fail.
It's the hard truth. Some of them don't work out.
Is government allowed to fail? No.
Right? We have to get out there and
plow the streets. We have to pick up your garbage.
The sidewalks have to be there at this point.
Department of Defense, they have to defend us.
If they fail, then, I mean, it's catastrophic.
If a business fails, well a business fails, someone files
bankruptcy and people go on with their lives.
But the consequences of failing a government are much greater.
So that's the point I want you to take away from there.
This is the basic difference. There's performance and then
there's accountability. There's two different
perspectives here. I would argue that we need to
balance these two things. So when people say that we need
to cut red tape or cut down on the bureaucracy, my personal
opinion is yes, we need to do it, but we need to do it in a
way that still leaves our bureaucrats accountable to the
people who are paying their salaries, the taxpayer.
So more entrepreneurial government might perform better
and be more efficient, but at what costs?
We might lose transparency and we might lose the due process
that people demand of their government.
If something fails under an innovative initiative, there's
much less accountability with the model, and that doesn't
always make people happier. The potential problems here are
it might be a little bit difficult and it might be a
little bit dangerous to rely on entrepreneurialism to fix all of
our government's problems. And I tried to highlight a
couple of those reasons in the last slide.
Government might start being more entrepreneurial just for
entrepreneurialism sake instead of using it as a tool to make
sure citizen needs and public policy objectives are met.
So we need to make sure that it isn't just used just to be more
innovative. It's got to be at appropriate
time and appropriate places. And not all of the
responsibilities of government should be met with
entrepreneurial tactics for a lot of different reasons.
So like I said, innovations often fail, and in this case if
it fails in the government, it's at the expense of the taxpayer.
So that's something to keep in mind, too.
So here's a really interesting historical example of an
entrepreneurial government. In the late 1990s, Russia was
considered to be a very, very entrepreneurial government, both
in the way that public policies came about, and also in the way
that they were trying to encourage business development
and economic development in Russia.
So there's a couple different measures of entrepreneurialism
here that are at work. What were the consequences of
this? Vast, vast corruption.
Okay? By our standards and still
today, like a lot of this is still leftover.
They've made some headway to sort of getting rid of this
corruption in their government, but compared to the United
States, Russia is not on the same level as far as
transparency and openness. So there's a lot of people who
were bribed to get different things, and there were a lot of
under the table business dealings.
But that's one of the prices that you might pay to having
relaxed regulations. And so this is why I'm saying we
need a balance between the two. You don't want to have this
crazy, corrupt government where anybody can do whatever they
want but it's innovative and entrepreneurial, and you also
don't want to have something that's so bogged down by red
tape and regulations and restrictions that nobody can get
anything done. Okay?
It has to be a balance between the two.
So I'm hoping that as we're going through this, use this to
sort of flesh out the two different arguments on either
side and understand what people are talking about when they talk
about well we want less government, well we need more
accountability, either way. The Department of Homeland
Security is a relatively new government agency, and they have
sort of a creative perspective on an old problem of
bureaucratic red tape. And they're sort of trying to
stop practices that are no longer relevant and simply
encouraging or adding to the government's red tape.
And had they formed this department that was one of the
things that they tried to do was sort of getting rid of these
regulations of red tape that were no longer applicable.
Sometimes laws are put in place 50-60 years ago, nobody thinks
about them anymore, they're still in place, and one of the
ways the government can be more entrepreneurial is getting rid
of those laws that are outdated, or regulations.
As far as entrepreneurs within an agency, they can sometimes
implement new practices to bring about change.
It's often very difficult. Depending on a number of things,
the organizational culture of an agency, the structure, but the
point is that an entrepreneur can sort of work their way
through this labyrinth of red tape and try to open things up.
So when the Department of Homeland Security was created a
few years ago many ideas related to efficiency were taken into
consideration. The government was able to
create this agency from scratch, and they were able to encourage
entrepreneurial thinking from the start.
It's much more difficult to do that in an agency that already
exists. So like the Department of Health
and Human Services, which is a massive government agency, and
it would be much more difficult for someone to go in there and
try to encourage new ways of thinking about it.
The Department of Homeland Security, they were able to do
that right away. And it's hard to say whether
this is a success yet because they're still a relatively young
agency. Maybe in 10 years we'll be able
to measure it on a difficult way and be able to see if their more
open way of looking at things actually produced better results
for the people. So one idea that you should
probably keep in mind when we're talking about entrepreneurs,
these leaders, is the concept of leadership.
So part of running a government more like a business involves
having good leadership and being able to reward people with
incentives, right? Positive results.
Some leaders are really great, and they're able to accomplish
great things. When we look back on these
people we'd like to attribute the greatness of the
transformation to leadership and innovation, cutting through the
red tape, being a really amazing person in all these different
ways. But were these leaders, were
they really wonderful, innovative people or were they
just there at the right time in the right place?
I'd argue that it's a little bit of both and that putting too
much emphasis just on leadership doesn't really get the whole
picture. Things need to be open to a
great leader to make significant change.
So entrepreneurialism in the private sector.
We talked about how government can be more entrepreneurial,
let's move on to the second way of looking at this.
How government can encourage entrepreneurialism.
So the government can enact policies to encourage
entrepreneurialism in the private sector.
Think about some of the web links that you've been viewing
for class, some of the presenters we've had in class.
Last semester Monty Schiro was here, and he talked about how
he gave health insurance to his employees long before it was
even mandated to do so. That's one way that private
sector can sort of be more entrepreneurial.
He was offering this benefit that most other places, most
other people were not offering their waiters and waitresses.
That's one idea. We also talked to a businessman
last semester who related his experience dealing with the city
council in trying to get zoning laws changed.
So that's one way that the public sector can sort of work
with the private sector to make things better for business or
worse. I've listed a couple ways that
the government can encourage entrepreneurialism.
It can give you secure property rights.
Lower your taxes. Lower regulation, red tape, and
they can ensure competition. This last point, this ensuring
competition, this relates to the idea of monopoly.
Monopolies are illegal in the United States, and there's a
reason for that. If monopolies were allowed to
just function as they would want to, there would be this sort of
efficiency loss. You'd probably be paying too
much for whatever good it is that you were buying.
And they probably wouldn't be providing enough of it for the
market. So the government steps into
this market failure, and they decide that, nope, there can't
be a monopoly. You've got to break up.
There's got to be competition among businesses.
Okay? Secure property rights is really
important to businesses. If you can't go to court and say
that someone stole your, I don't know, your car or whatever it
is, the rule of law and justice comes in very important in
business dealings. And taxes.
Small business tax cuts to spur innovation and growth.
So the important thing to keep in mind here is that anytime
you're giving benefits or tax breaks to one sector of the
population, you have to take something away from another.
So is it really efficient? Is it better for society overall
to give small businesses tax breaks?
What do you guys think? Do small businesses create a lot
of growth? Are they sort of an economic
engine? Do they create a lot of growth
and then a lot of tax revenue so the tax breaks sort of pay for
themselves in the end? Or are we just subsidizing on
the backs of other people, small businesses to be able to go
and create whatever it is they think is good?
It's a very important question, and I certainly don't have the
answer here. The last thing I wanted to talk
about is policy entrepreneurs, the concept of a policy
entrepreneur. So these are the people in
government and nonprofits who make it happen.
They take advantage of a policy window.
This is what John Kingdon calls a policy window: when something
happens that opens up an opportunity for a specific
public policy to get passed into law or put into place after
maybe many years of sort of being on the sidelines of public
debate. So these are the people
themselves within government or the nonprofit sector that
really, like I said, they get things done.
They're the innovative leaders who not only have a good, if not
great, idea on how to make the world a better place, most
importantly they have the innovative, creative,
risk-taking ideas on how to get that good idea actually into
place, how to put it on the national agenda.
So usually these people are outside the formal positions of
government. They can be like research
groups, but they can also be appointed positions.
If they're entrepreneurs working in government, a key to that
success is being able to maintain successful
relationships with the outside groups in other external
constituencies. One person you might want to
think about, is Barack Obama a policy entrepreneur?
You could probably argue either way.
I think some people might say that it's sort of impossible for
him to be one now because he's the president, and he's got to
lead the country overall, he can't be out here talking about
crazy, innovative ideas. But on the other hand, maybe
he's in the best position in the country to talk about these
crazy, innovative ideas that might have big results or really
big payback for us. Policy entrepreneurs advocate
for a number of different reasons.
There are three reasons, specifically.
They may enjoy the process. They just love the game, getting
in there, talking politics. They might be advocating in
promotion of something that they hold very dear, some issue that
they really think is important. And I would say Susan G Komen,
Komen for the Cure, I think her sister died of cancer, now I
would say she's probably a policy entrepreneur because it's
a very important personal issue to her.
Or they might be advocating for something that reflects their
values. When I say this, immediately
comes to mind some of the maybe more religious focused groups,
but it can be really anything. It can be like an environmental
group where you think environmental justice is sort of
a basic human right. Here are a couple historical
figures which I would call policy entrepreneurs.
When we talked about the Wisconsin Idea earlier in the
semester, we talked about a couple people who exemplified
that idea. I think this sort of exact same
idea carries over into this discussion today.
Edwin Witte, he's the father of social security.
So when we talked about this idea at the University of
Wisconsin when Roosevelt was first in office, Edwin Witte
eventually took this idea national.
And this is a really good example of a policy entrepreneur
sort of working on the idea, building up the adequate
evidence and resources to put into place, and eventually when
he had a policy window when Roosevelt got into office he had
an opportunity to put it into place.
Robert LaFollette, again we discussed Fighting Bob, right,
as an example of someone whose entire career was the
exemplification of the Wisconsin Idea.
And I hope now that we've talked about both sides of this you can
see how he was a policy entrepreneur and how the
Wisconsin Idea really fits into that whole conversation.
It takes ingenuity to make change in any government.
The existing structures are extremely, extremely resistant
to change for a lot of different reasons, a lot of them really
good reasons. So these guys were there at the
right time at the right place, and they made changes that
benefited all of us. I wanted to give you an example
of a more recent entrepreneur. These guys have both been dead
for many years so let's talk about somebody who is more
contemporary. Kenneth W Kaiser was appointed
chief executive officer of the Veterans Health Administration
in 1994. So before he was appointed to
that position, the VA had a really, really awful reputation.
And that reputation was so strong, in fact, that many today
still think the VA provides awful service to our nation's
veterans. In fact, they're providing
higher quality healthcare on a number of different measures at
a lower cost than the private sector.
Did you guys know that? So after the whole healthcare
debate, this is a really profound idea.
How did that happen? Well, Kaiser came in and he had
his vision for change and his blueprint for the future of the
VHA. I won't go into the exact
details. If you want to talk to me about
it, we can talk about it after class.
The point is, is that he came in with these great ideas and he
implemented them and he actually made a lasting, profound,
important change in our nation's healthcare for our nation's
veterans. So another example of a recent
policy entrepreneur, if you guys all listened to that podcast I
had assigned today through freakonomics, a wonderful
podcast series if you haven't started listening to it, I
recommend all of them. But the one that we listened to
for today talked about Secretary of Education Arne Duncan.
So in his role as Secretary of Education he created this
national initiative called Race to the Top.
And I encourage you to read more about this if this is at all
interesting to you because I think that this is a lot of
where education policy is headed in the next few years because
budgets are so strapped people are thinking of new and
innovative ways to get better education outcomes.
And one way of doing that is sort of creating competition
within the education arena. That's a really good example of
a more recent one. Ralph Nader, he's my sort of
quintessential policy entrepreneur, and a lot of the
literature that talks about policy entrepreneurs in the
public policy sphere, he's sort of the big example.
So you guys have all heard of him, right?
He ran for president in 2000. He got a pretty small percentage
of the vote, but it was still a lot of people.
He's a very important national figure.
He founded Public Citizen, which is a consumer protection
watchdog group which is in Washington, DC.
And he has a long, long history of advocating for consumer
issues. That group he founded in 1971.
So Ralph Nader helped create a movement that eventually led to
the creation of the National Highway Traffic Safety
Administration, NHTSA for short. NHTSA's mission is to save
lives, prevent injuries, and reduce vehicle-related crashes.
So in case you don't know, we all should though, right, this
very important government agency, NHTSA, it didn't exist
before Ralph Nader pushed for its creation, but it's
responsible for a lot of really important things that I think
affect all of us every time we get into a car.
Things like safety statistics. Safety standards.
Theft resistant standards. Fuel economy.
Licenses. This is also the organization
that administers the VIN system. They also developed the dummies
that people use in crash testing.
So in the 1960s, Ralph Nader advocated for the government to
take responsibility for the regulation of traffic safety.
This is something that didn't happen before he came into the
arena here. He was responding to the
question, should the government take responsibility for the
regulation of highway safety? There were really powerful
interests that were incredibly investing in stopping him from
achieving his goal in creating this new traffic safety
administration. So he created a movement.
And it was really just a crazy uphill battle.
The relevant special interests were the American auto
companies. And they had a lot of money, and
they had a vested interest in stopping this from happening
because it was going to cost them a lot of money to comply
with a lot of the regulations that he wanted to put into place
to make our cars safer. They spent a lot of money
against Mr. Nader when he was trying to do this, and so he had
to be really clever and innovative in the way that he
presented his ideas to the nation.
He didn't have the money that the American car companies had
to lobby against him. He had to be creative.
He had to be smart. He had to be catchy and
innovative. Classic entrepreneur.
And in the end he was successful.
So he took risks, he worked hard, he created a moral crusade
out of a policy issue, and he also made a national name for
himself. And he's still quite important
today. And this is really where I think
he kind of got his start to being on the national stage.
Everyone agrees that we are safer now on the roads than we
were in the 1960s. Data shows this.
Mile per mile traveled, we're much, much safer.
Cars themselves are much safer, and consumers have a lot more
information about the safety of their cars.
What did he do? He created this policy movement,
and he built it on real evidence of traffic safety statistics.
He wrote articles, he talked to important people, and eventually
he got congressional hearings where these things were talked
about on a national stage. He thought of creative and
innovative ways to work within the system to achieve a desired
policy outcome. So he's the exact definition of
a policy entrepreneur. He was persistent, he had some
connections, and he used them, and he was very passionate about
the issues. So I think that that pretty much
wraps us up. Are there any more questions
about what Ralph Nader did? Does everybody understand how
that relates to what we've been talking about in this class
all semester long? The ideas of entrepreneurialism?
Or any ideas about public policy?
Are we clear on all of it? >> And you can have questions
for Katherine or you might have comments considering what we've
been talking about, what Katherine has shared with us
because there is certainly a lot of material that you've shared
with us but there's a lot happening right now, too.
And I'm sitting back here thinking through having heard
Katherine share these points in the past, I'm thinking
through some very different thoughts than I thought a few
months ago when I heard this the first time given all that's
happening. So what are you thinking?
What are you thinking or what kind of questions might you
have? Anybody?
Give it a moment. >> You might think about what's
been happening up the street in relation to this.
One of the big things in the budget repair bill and in the
budget bill is this idea about the Badger Partnership, which if
you watched Mike Knetter's web link for this week, you'll know
quite a bit about. So it's all very controversial
so I understand people's reticence to maybe speaking up,
but if you have any comments, please share.
I'll come over to you. >> We have to record it, though.
We can't hear you otherwise. >> Well I was just wondering
with the Badger Partnership, my biggest concern is how they're
going to increase financial aid for lower income students
because quite frankly that's the only thing that I see that is
like a giant red flag. The rest of it may be good for
the future but for right now that's what really concerns me.
How do you think they're going to do that?
I don't know. And I honestly have the same,
that's one of the big things that sort of makes me cautious
about it as well. I don't know and I don't think
anybody knows. At my school, obviously, we're
talking about a lot of this stuff at the LaFollette School
of Public Affairs. And I don't think anybody has
seen an exact proposal of how that is going to happen yet.
But I think that's a really good thing to think about, and the
way that I would relate that back to what we've been talking
about today in entrepreneurialism is that we
have these ideas about how we want to make things more
efficient and better and everybody will be better off if
we can just have more freedom to be able to do certain things,
but at what cost? So the cost in this case, in
this specific part of the Badger Partnership, is that it might
create even higher barriers for low income students to be able
to get into the university. >> Question back here.
Yep. >> More of just a comment but
kind of looking back at the Madison Undergraduate Initiative
which Biddy kind of proposed as being part of the New Badger
Partnership in the beginning, that's an incredibly
entrepreneurial way to look at it because the higher
socioeconomic classes had to pay that but the lower ones didn't,
and that built up an endowment that is now giving money back
for scholarships. So as that continues with the
New Badger Partnership hopefully it will just get bigger and
bigger and better and better. >> Great.
I'm going to ask you, Seamus, can you describe that
initiative? [INAUDIBLE]
The Madison Undergraduate Initiative, it was what was
voted on like two or three years ago, and now we all pay
an increased amount on our tuition, but if you are at a
lower socioeconomic class and can't pay that increase, you are
supplemented and don't have to pay for it.
So you get like a stipend towards it.
So if you have the money to pay for it, you do pay for it and
that goes towards an endowment that is built to offer more
need-based scholarships. >> Great.
So that's a perfect example of an entrepreneurial sort of
innovative solution to a public policy problem.
The public policy problem being access to higher education.
Are there any more comments or questions?
And obviously you can come and talk to me privately if you have
anything else you'd like to ask or say.
I'm just going to throw out kind of a half comment/half
question out, and I don't know that there is an answer, but I
was listening to you and thinking about the example that
you shared regarding President Obama and how some have really
considered him quite entrepreneurial at the time that
he was a senator and as a campaigner but wonder if people
still consider him so entrepreneurial.
Now, we can answer that or not but it gets to the point of when
you look at movements and when you look at policy
entrepreneurs, does there come a point when people are elected
into leadership roles where the masses would no longer consider
them to be entrepreneurial? >> Right, yeah and that is
something that I think there is no answer to.
I think that, like I said before, people could probably
argue both ways for President Obama.
I think there's a lot of people, especially sort of the far left
people, the base of the democratic party who think that
he's not doing nearly as much as he could be doing.
There's a lot more innovative sort of far left liberal
policies that they would like to see put into place that he's not
doing right now. But at the same time, the
Secretary of Education, Arne Duncan, with what we talked
about in that podcast that you guys listened to today,
the education initiatives, the Secretary of Education
is under the president. That initiative is part of
President Obama's platform, and that's part of his
administration. So I think we can point to
probably hundreds of examples just like in the Department of
Education in the way that his administration is furthering
entrepreneurial ideas. >> Great, great.
Anything else before we move on? I want to thank everybody for
thinking through this. It's a really different kind of
concept. Again, as we start to delve into
different areas of entrepreneurship and how it
impacts different sectors, and I especially want to thank
Katherine Sydor for an excellent lecture.
Didn't she do a great job? [APPLAUSE]