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File before reading; when the inspector general speaks, nobody listens.

File Before Reading When the inspector general speaks, nobody listens

Do you remember that press conference in 1986 where Ronald Reagan revealed, "Repeated cases of fraud and abuse within HUD programs have resulted in substantial losses to HUD and the taxpayer. Investors, speculators, real estate agents, and salespersons have misused the programs for personal gain"? How about the speech around that time by Rep. Barney Frank, which disclosed that "a high percentage of units in HUD's existing public housing program have significant violations of HUD's housing quality standards"? Or that story from The New York Times in the fall of 1988, the one by Martin Tolchin with information like this: "The majority of modified rehabilitation projects funded by HUD over the last five years were selected without the type of open competition intended in HUD regulations"?

If you don't remember, there's a good reason. The press conference didn't happen, the speech didn't get made, and the story wasn't written. But all that information was available at those times - in the HUD inspector general's reports. And these reports were public information - fair game for presidents, congressmen, and journalists. True enough, inspectors general, being career bureaucrats, tend to whisper rather than shout and characteristically favor oblique phrases over acute ones.* But aren't the above facts at least a little attention-getting? Shouldn't they have piqued the curiosity of the president's aides? Aren't congressional staff members and reporters paid to start investigations into situations like these? But in fact, the HUD inspector general gave a scandal and nobody came.

There are many morals to be gleaned from runaway failures of government like HUD. One of them is that no one had been paying enough attention to the nation's inspectors general. Oh, sure, now that the HUD scandal has blossomed so colossally, people are starting to listen to the inspector general for that department. (Lately, material from HUD inspector general reports has found its way into the The Washington Post the day after the reports were released - quite a change from the recent past when the Post didn't even have a reporter on the HUD beat.) But only time will tell if that's really meaningful attention or merely scandal-driven reporting by the press and damage control by HUD. And what about the inspectors general at all the other departments? It's essential that they be quality people with the ability to identify and analyze the problems of their agencies and with the courage to report what they discover. But it takes day-to-day scrutiny of their reports to increase the pressure on inspectors general to be just that. In the absence of raging scandal, is anyone really listening to them?

Asked who gets inspector general reports, a press spokesman at the Office of the Inspector General says, "I'm not aware of a copy being sent to the president." Yet the Inspector General Act of 1978 leaves no doubt about who the inspectors general* work for: Hey Mr. President, this omsbudsman's for you! To protect inspectors general from censure and control by the heads of the agencies they monitor, the act specifies that only the president can fire them (and even he has to explain such dismissals to Congress). So the White House's unresponsiveness to inspectors general is particularly egregious.

It's the Office of Management and Budget (OMB) that's supposed to be the White House's trip wire on bad news from the inspectors general. And nowadays at OMB you'll get a lot of admissions that inspectors general were being ignored there before Richard Darman took over as director - that's for the first 10 years they existed, mind you. Commenting on inspector general reports, OMB's Morgan Kinghorn doesn't bat an eye when he tells you that "the traditional OMB approach was to file this stuff." But he's quick to tell you that under Darman, things are going to be different - that every inspector

general report will be reviewed by both the management and budget sides of OMB, with any bad news being immediately flagged for Darman. But Kinghorn's eye-glazing description of how this is going to work seems a far cry from the Inspector General Act, which speaks of inspectors general being "appointed by the president . . . to conduct, supervise, and coordinate audits and investigations. . . ." Instead of any such direct linkage between inspectors general and the president, explains Kinghorn, there are three OMB boards that deal with the problems they raise: "There's the PCIE - the President's Council on Integrity and Efficiency: there's the PCMI - the President's Council on Management Improvement; and the Chief Financial Officers Council. . . . And I think the director [of OMB] has just created a coordinating council of about six people representing those three groups. . . . Then there's the JFMIP - the Joint Financial Management Improvement group - composed of GAO, OMB, and Treasury. . . ." Thus far, Kinghorn admits that none of these groups is looking at individual inspector general audits, only the semi-annual general summaries. Additionally, "We are now looking at ways in which OMB may begin to organize review teams in some of those areas which seem intractable." Maybe all this plumbing will work, but it's not exactly the IG on the Bat Phone to the Oval Office.

Eighty-four congressional committees and subcommittees had jurisdiction over HUD during its scandal years. And all of those congressional staffs received HUD inspector general reports. Although until the HUD scandal broke, committees didn't receive individual audits - specific investigations like "Misuse and Diversion of Assets and Income at HUD-Insured Multifamily Housing Projects," "Losses in the Sale of Single Family Properties, Coral Gables Office," "Wage and Hour Back Wages Collection," and "Review of Petty Cash Fund" - they did receive the semi-annual summaries. And congressmen and their staff members should have known about the existence and availability of those detailed audits, since brief descriptions of them are required by law to be listed in the summaries.

The housing issues investigator for one congressional subcommittee knows just where to find the inspector general audit reports he needs for his work: "They're in an enormous box on my floor - about a month's worth." Such paper pile-ups aren't a matter of understaffing. If congressional staffs spent more time on their oversight functions and less on publicity and fundraising, the piles of inspector general reports in Hill in-boxes would be a lot lower. Congress simply has not put much emphasis on what the inspectors general have to say. "If the Senate and House Agriculture committees were routinely getting IG reports, I have to say they weren't being looked at there," asserts Ward Sinclair, who used to cover the Department of Agriculture for The Washington Post.

When I ask a House staff member if all inspector general reports in his committee's area get read, he's dumbstruck: "You think we've got an investigative unit over here?" Rep. Christopher Shays rationalized Congress's molasses response to the HUD inspector general this way: "There were so many questions that weren't answered by the inspector general's report." Well, then why didn't you look for those answers, congressman? Besides ignoring their audits, Congress has also failed to establish a close working relationship with the inspectors general themselves. One committee staff director excitedly tells me that he's just come from the first in-person briefing his committee has ever received from an inspector general. And he's been there 14 years. "When I was at Interior, for instance," recalls June Gibbs Brown, who in her government career under Carter, Reagan, and Bush has been inspector general at Interior, NASA, and Defense, "I didn't feel that the committees there were paying any attention to the IG reports at all."

Curses, FOIA'd again

There's another, darker reason for the lack of congressional follow-up on inspector general reports: Members don't want to ruin the gravy train for their constituents and hence themselves by looking into them. A congressman's desire to get agency money for his district - or to get money for some other member's district as part of a logrolling deal - dulls his zeal for evaluation.

But if the press were a more avid consumer of inspector general reports, politicians wouldn't feel so free to ignore them. "Lawmakers Were Warned of Abuses at HUD" trumpets the headline of a New York Times story from last summer about the HUD inspector general's attempts over the years to get the story out. And so they were - but where, by the way, was the Times when those warnings were issued?

Between the inception of the space shuttle program and the Challenger disaster, the NASA inspector general issued hundreds of audit reports concerning safety and defective materials. "I was always amazed that the press didn't really hop on those reports," confesses June Gibbs Brown, who was the NASA inspector general who produced many of those pre-Challenger audits. "There's some pretty hot information in them. If I were a reporter, I'd be waiting for them to come out to see if there was some new information that I could look into and follow up on."

Howard Kurtz, a Washington Post reporter who used to cover HUD - and who recently got some space in his own paper to chastise it for blowing the HUD story (see "Why the Press Didn't Press," at right) - has also been disappointed in the failure of reporters to appreciate inspector general reports. One reason he points to is that inspector general reports don't lead directly to stories. "Most reporters are by nature frantic and concentrating on stories for this week. It's just hard to do that sort of digging and studying." As a result, says Kurtz, "Most IG reports go unnoticed in most newsrooms." He adds that "Washington reporters want to cover the White House, they want to cover the Hill. Not a lot of them want to cover the Interior Department. So a lot of those reports just get missed."

In fairness to reporters, the government has made it harder than it should be to get at the key information the inspectors general put out. At one national newsmagazine, the reporters working on the HUD cover story were required to file Freedom of Information Act (FOIA) requests just to get the HUD inspector general's semi-annual general summaries, and once they received those, they had to follow-up with additional FOIA requests to get at the real information they needed. This took weeks.

That FOIA barrier can seem insurmountable to a beat reporter at a daily newspaper. "I knew that Agriculture was a place where there should be some really juicy IG reports," recalls Ward Sinclair. "The USDA is a prime place for scandal. I just didn't know what to ask for. I didn't have time to turn in an FOIA request saying I want copies of every inspector general report written in the last three years about food stamp fraud, or about violations of the farm subsidy payment limitations." Why should there be all this FOIA machinery governing inspector general reports? Except in those rare cases where national security or an incomplete criminal investigation would be compromised by disclosure, reports the inspector general has already signed off on should just be released - period.

And there is no reason why every inspector general doesn't make available not just the twice-a-year list of completed audits it does now but also a monthly updated list describing audits initiated since the last semi-annual report. "If I had known the IG had a list of reports every month available to the press," says Sinclair, "I would have gone over and looked at that list. It would have become part of the beat when I walked the halls over there. It probably would have propelled me into some pretty good stories."

Sinclair also says that he rarely found anybody in the inspector general's office who would tell him what sorts of problems were being uncovered. "Generally they were close-lipped and secretive. I just didn't find IG people with axes to grind." This is very different from Congress, where, as Kurtz puts it, "staff members flack their reports to reporters, saying `Look at page X, there's a good story there.' That's what reporters need."

The whole idea behind the inspectors general was to get information out on government agency problems where everybody - the president, the congress, and the press - could work on them. But for too long it's been assumed that everybody else was working on them. That's got to stop. The inspectors general really do need straight lines of communication to the White House. Any of their reports that they feel are important should go straight to the president's desk - attached to a summarizing memo prepared by a member of the White House staff, of course. And the president needs to read enough of these to keep government on its toes. This would bring into play the audit principle used to such good effect by the IRS: the taxman can't catch all the cheaters, but he might catch me. The inspector general should be thinking, "Well, the president probably won't read my report about this problem, but I'd better really get to the bottom of it, because he might."

If "trust, but verify" is a good slogan for arms control, it's a great one for evaluating the government. The president cannot just assume all the bad news is traveling up. Likewise, the Congress and the press must shoulder the burden of helping the inspector general's message find its mark. If the president sincerely believed any bad news from the inspector general wouldn't stay a private dirty joke for very long, he would feel more pressure to respond to it. And if the inspectors general knew that the president, the press, and the congress were really paying attention, they'd write better reports. But unless we make these changes, our national life will continue to be a matter of press conferences never given, speeches never made, and stories never written.
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Title Annotation:Department of Housing and Urban Development, includes related information
Author:Shuger, Scott
Publication:Washington Monthly
Date:Jan 1, 1990
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