I’m not usually in a position to say that I have more experience, knowledge and know-how than Ben Bernanke, but he really should’ve talked to somebody like me before heading to Capitol Hill yesterday to help Treasury Secretary Henry Paulson present a three-page memo asking for $700,000,000,000 of the public’s money.
Three pages. Seriously:
Under questioning by the Senate banking committee, treasury secretary Henry Paulson clashed repeatedly with congressmen as he admitted that he had only a rough idea of how his department would price and purchase toxic mortgage-backed securities. …
Legislators pointed out that they initially received only a three-page summary of how the government’s intervention will work.
That description of a “three-page summary” isn’t quite accurate. Calling it a “summary” implies that there exists some longer document offering a more detailed and documented proposal. No such longer document exists. The three pages isn’t a “summary,” it’s the entire plan.
And Paulson didn’t present that plan as a “summary.” He presented it as a piece of legislation he wanted Congress to introduce, and pass, and turn into law, in a day or two. Here’s the entire document.
A bit of experience in the nonprofit world would have helped Paulson and Bernanke here. It would have helped them to realize that when you’re asking for money, you have to do your homework.
I spent a decade working for a broke nonprofit — basement offices, salvage-yard furniture, etc. The kind of place where the founder/president/executive director spent evenings stuffing envelopes along with the rest of the staff.
Maybe you’ve worked, or volunteered, in an office like that too. If so, then you know that stuffing envelopes is never enough to pay the bills — you also need grant money. That means writing grant applications or, as the lingo goes, “writing grants.” Lots of grants — big grants, little grants, national grants, local grants, targeted grants from niche donors and those invaluable and elusive elastic grants for the operating budget. Grants for programs, grants for interns, grants for travel, grants for computers, grants for grant-writing.
The point here being that we wrote a lot of grants.
And the thing is that every one of those grants was longer, more detailed and better documented than the sorry excuse for a memo that Paulson threw together to request $700 billion from the public coffers.
A three-page memo with no details means your grant application gets turned down. It means your $15,000 grant application gets turned down. Why? Because $15,000 is a lot of money, and if you’re going to ask someone to hand over that kind of cash, then you’re going to have to do your homework. You’re going to have to explain, in detail, what the money is for, where and when it’s going to be spent. You’re going to have to explain how you intend to report back, with detailed documentation, after the money is spent. And you’re probably going to have to describe a detailed plan ensuring that you won’t need to come back six months later to ask for another $15,000 for exactly the same thing.
Fail to provide that kind of documentation and detail and your grant application will be rejected. Not only that, but you’ll be lucky if you’re ever allowed to come back and re-apply with the same foundation. Why? Because $15,000 is a lot of money, and when you ask someone to give you $15,000 without the courtesy of telling them what precisely it’s for, they tend to take offense. And the failure to do your homework and put together a decent, detailed application is viewed as evidence that you’re not responsible enough to handle the money wisely. “We’re lazy and disorganized — give us money” is not considered a winning grant-writing strategy.
Paulson, of course, was applying for a bit more than $15,000. He was asking for 47 million times that. He was asking for $700,000,000,000.
So, yeah, a three-page memo ain’t gonna cut it.
By way of contrast, consider that on the same day that Paulson was offering his half-baked grant application for $7 x 10^11, Congress was also working on an omnibus spending bill for FY2009. That bill includes the entire budget for the Department of Homeland Security, everything the government is budgeting for veterans programs, for military base construction and, oh yes, an all-time record high request from the Pentagon for the Department of Defense. The total pricetag? $630 billion.
That omnibus spending bill weighs in at 357 pages, plus 752 additional pages of notes, explanations, pork, etc. More than 1,100 pages in all. That’s for a request for $70 billion less of the public’s money that what Paulson was requesting with his slapdash, cocktail-napkin memo.
Heck, even Alaska Gov. Sarah Palin’s request for FY2009 earmarks — a paltry $197 million or so — comes with 70 pages of documentation painstakingly compiled with help from Sen. Ted Stevens (link to a .pdf can be found here). Sure, a lot of that is for parochial boondoggles and thinly veiled plunder, but the Palin/Stevens pork-barrel wish-list was assembled with far more care and attention to detail than Paulson bothered to put into his three-page non-summary.
I’m guessing that none of you will ever be in a position to have to apply for a $700,000,000,000 or a $630,000,000,000 or even a $197,000,000 grant. But someday you might be serving on a board of directors for some nonprofit and you might have to write one of those $15,000 grants to fix the leaky roof.
If you should find yourself in that situation, try to be as thorough and detailed as possible. A three-page memo just won’t do.
Why? Because $15,000 is a lot of money.
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