Wisconsin Public Television University Place Entrepreneurialism in Society  Katherine Sydor, "Public Policy and Entrepreneurial Thinking"  March 9, 2011 UP561   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]