By Chip Flowers
With Delaware struggling through the most serious recession since the end of World War II, Gov. Jack Markell has made a startling proposal: to eliminate our state Department of Finance.
Surprisingly, the proposal, which calls for eliminating only one job (the secretary of finance) and shifting the department’s three divisions (Revenue, Accounting and the Lottery Office) elsewhere in state government (the governor hasn’t said where) has stirred little discussion.
Perhaps that’s because the General Assembly, exhausted from dealing with $800 million in budget cuts, is out of session and welcomes a break from financial discussions. Perhaps it’s because the state’s finance leaders — the secretary of finance, the directors of the Office of Management and Budget and the Economic Development Office, the Economic and Financial Advisory Council chair and our treasurer — were appointed by Markell.
Regardless, it’s important that voices outside the administration speak up before the General Assembly decides whether to approve it. After all, it’s reasonable to question whether it’s prudent to eliminate the Department of Finance with the state in the eye of an economic storm.
Though I admire the governor’s spirit in challenging the status quo, I’d like to offer three arguments against dismantling the department.
First, in times of economic crisis, the secretary of finance should be governor’s primary financial advisor. Placing emphasis on eliminating the finance department has misdirected energy, crippled an important resource and depleted the political capital of its leader. While the current governor may elect not to use the department and its secretary (which is well within his right), it does not mean future governors would downplay this important cabinet figure.
Second, it will not result in significant cost savings. For now, it appears that many state employees would be relocated to save one or two salaries and to claim that an entire department was eliminated. Saving the finance secretary salary does not outweigh having a trusted advisor at the decision-making table. In an economic crisis, we must not sacrifice leadership in the name of minimal cost savings or efficiency.
Finally, it would remove a check and balance. Like weights on a scale, our finance secretary, agency directors, advisory councils and state treasurer offer independent analysis of the state’s economic status. Removing a weight from the scale and changing the reporting structure will fundamentally shift the delicate balance that supports the financial structure of our government.
Eliminating a department at the whim of any governor would place our government in a state of flux and could encourage talented staff to seek more stable employment.
In any debate, we must be open to new ideas, including revamping departments. However, this department deserves to remain as a pillar in our state’s financial system.
Chip Flowers, a graduate of John F. Kennedy School of Government at Harvard University, is President and Managing Member of The Flowers Counsel Group, LLC, a corporate law firm based in Wilmington.
