Government Innovation: U.S. Congressman John Delaney & Sorenson Impact Director Jeremy Keele

Government Innovation: U.S. Congressman John Delaney & Sorenson Impact Director Jeremy Keele


– Hi my name is Jeremy Keele, I’m the
President CEO of the Sorenson Impact Center. I’m with Congressman John Delaney from
the state of Maryland. Congressman it’s so good to be with you. -Great to be with
you Jeremy. -Thanks for spending a few minutes. It was great to have you
keynote our conference here in Salt Lake. I wanted to touch on something in the short, few minutes that we have together that you highlighted in your in
your talk. You have this really tremendous private sector
background, which I think is pretty unique for a lot of folks in government.
You started two companies that went on to become publicly traded companies. So you have this tremendous background from the private sector, and what I’ve
gathered from my interactions with you over the years is that that’s really
sort of influenced the way you think about policy and government. And you
strike me as sort of one of the real thought leaders in Congress around how
you infuse innovation, private investment, and some of the kind of private sector
discipline and focus on accountability into some of the way we think about
solving social problems. Tell me a little bit more about that. -Sure. Well first of
all its great to be here. This kind of conference is a huge success and I feel very
privileged to be part of it. The private sector taught me many things. One of
the things that it taught me was that if you really want a good economy you have
to get everyone working together. You have to get the government working well
together, you gotta get the private sector working well together, and you have to get the
nonprofit sector working well together. And that kind of animates everything
that I do in public policy. And if you think about some of the issues we have
in society, some of the really big issues we have in society, we’re going to have
to make some transformative investments, we’re going to need some innovation, and
we’re going to have to do a much better job tracking results and looking at
metrics and doing all that kind of analytical work that you find in the
private sector. So the best way to make that happen, it seems to me, is for the
government, which is the last mile in all of these issues, right?
Whether it be education or health care or housing issues or climate change or
the opportunity gap, the government is obviously central and essential to any
solution against those problems. But to the extent the government can partner with the private sector and the nonprofit sector – because I think
both of them are really important here – you get the perfect situation. Because
you can get some additional capital, which is needed, right? The government’s
ability to invest a lot of money at this point is very limited in when you’re looking at the fiscal
situation of the government. Yet there’s a huge amount of capital outside of
government, and much of that capital would like to be deployed against some
of these big issues. So by partnering, you not only get capital, but you get all
that innovation that just totally drives the private sector and really changes
the world. So you get that innovation engine working against these issues. And
then you get the discipline that you talked about where results are measured
and you get a feedback loop either a negative or positive feedback loop and
then you start changing and making adjustments and innovating to better
answers. So that’s why this notion of bringing those parties together, whether
it be for pay for success framework or social impact bonds or any of the other
kind of terms or strategies that are used for the relationship, I think it’s
so, so important. -You have taken up this legislation that we’ve worked on
together around social impact bond that would really kind of engage the federal
government in a way that’s just never you know been possible in the past. Can
you tell a little bit more about, not just the legislation, but also sort of
the traction that it’s gotten in your body and the Senate? Sort of what you
think the prospects are for that? – So what our legislation does is create a hundred
million dollar fund within the Department of Treasury. And this
legislation passed overwhelmingly in the house last Congress. It almost passed in
the Senate, but it wasn’t considered at the end and we feel very confident that
it’ll get consider this year. So what the hundred million dollars will be used for
by the Department of Treasury, it will be made available to local governments.
Because all this is happening at the local government level. That’s where all the
action is in all these kinds of programs. The 100 million can fund grants so that the
local governments can bring in the expertise they need to set up these
programs. It can actually be used to make success payments to the extent the local
government needs to bring in kind of a government partner to help prime the
pump with the private sector. And then it can be used to fund the
analytical work about how the projects ultimately work out it if provided that
information to share. -Going back to that measurement. – Yeah, so its very bipartisan.
And what we’re really trying to do is take what’s happening in places like
Salt Lake City and other local governments around
the country where they have these innovative programs in education, which
is what we see here in Salt Lake City. I talked in my speech about what’s
happening with asthma in Los Angeles and the several other programs like this
happening all around the country. And we want that to be replicated across the
country, and we think the federal government can play a role in helping
induce the local governments, if you will, to think about this as a way of
providing government services as opposed to the old model where the government
tried to do it all. Bring in partners, bring in the nonprofit sector, bring in the
private sector, structure programs that you only pay these partners if they get
the outcomes that you desire. And really try to make a difference
against them. These are very, very significant structural problems we have. – The scope and the magnitude of the challenges are clearly daunting.
Do you think that we always talk about being in sort of a hyper partisan era?
And it seems like every time you talk about it it’s even more partisan than it
was the last time. Is this sort of the concept that has such enduring, sort of
universal and bipartisan appeal that this is likely to sort of continue on
and grow from here? Or are we in real danger of this thing falling apart at
some point? – No I mean it’s got very good bipartisan support. Fundamentally because
it gives each side something that they’ve wanted for a long time. Democratic Party
has wanted more investment against some of these issues. They’ve wanted more
investment against poverty, they want more investment in health care, they want
more investing in housing, etc. And by embracing these kind of programs, you
bring in all that capital, that is accumulating at a very rapid rate
outside of government, into these kind of situations, right? So these programs
result in more investment against some of these big challenges. So that makes Democrats right hand. – Right. – Well Republicans have wanted, and
they write about this as well, is more accountability, more transparency, and
they’d like a more conservative approach to how government provides services. And what that means is making sure you get outcomes before you pay.
And nothing’s more conservative than only paying if you get the desired
outcome that you want. So this framework also gives Republicans some of the things
that they’ve wanted it for a long time. And I’ve always believed the best way to get
wins in Washington or in any legislature is to give each side a win, right? Because that’s how people want to accomplish something. And so I think that’s why it’s been very
bipartisan, and I think if we can do more of these programs, I think it could
actually change the way our citizens think about government and some of the
most important institutions in society including how they think about the
private sector. Because right now there’s been this erosion in confidence in
government and so many important institutions in our society and really
in the private sector to some extent, right? Where people think their motives
are not really the motives that are right for all the people of the society. So I
think this can have both a short-term very positive impact but also a very
long-term positive impact in terms of changing the way people think about our
most important institutions, and that really excites me. – What do you, last
question i promise, but what do you think about…I mean you must get challenged on
this by some folks probably on both ends of the spectrum a little bit who say that the sector should stay in their own lanes. We
have philanthropy, we have nonprofits, government, that’s their role to solve
social problems. Private sectors role is to make more money, accrete wealth to the base of capital, and do things as the private sector
is purely good at doing. Why would you try to crossover? How would you
respond to that? – So the way I’d respond to that is by saying,
“that’s a very simplistic way of looking at it.” Because its all interconnected in a way,
right? The private sector creates all the jobs, which generally creates all the
revenues for the government. And most charitable and philanthropic engagement
comes from someone at some point in time doing something in private sec, right? So it’s
all kind of holistically interrelated. And I don’t think those
sectors necessarily think of themselves that way. I don’t think the private
sector believes it has no role in society. Whether for their own good they
know a stronger healthier society is actually good for the bottom line, but I
think increasingly, companies are trying to be just in terms of how they behave
as well as focusing on their fiduciary duty, which is to make money for the
shareholders. So I think some people do look at it that way and I
think it’s a narrow way to look at it. What I also try to point out to them is
in my own experience when I’ve traveled around the world, and I’ve seen good
economies. I always find a situation where the private sector and the nonprofit
sector and the government sector are working really well together. And that correlation is a very strong correlation if you go around the country.
We talked about it here during the governor’s remarks where he talked about
how well Utah was doing, which it is doing well. But there’s a lot of
collaboration here between those sectors they’re all kind of thinking about some
of the same goals. They’re not fighting with each other. That doesn’t mean they’re not going to have disagreements, they will. But fundamentally, you’re trying to create a
culture where these various stakeholders can work together towards these common
goods. And I think it’s in all of their interest because if you do this,
government looks smarter and people feel better about government. And the private
sector is viewed as having a transformative role in society above and
beyond whatever its commercial enterprise is. And you see that in a lot of
communities where some of the most recognized businesses are important to
community services. But this is taking it and then this is macro issue going on
with capital in the world. I mean governments are strained fiscally in
enormous amount of capital accumulating outside government. And it’s
being concentrated by people talking about what’s happening with wealth
distribution. And it’s true, the facts are undeniable. Now my own opinion, at least
in the United States of America the most charitable nation on earth, most of that
money ultimately is going to go back towards some kind of philanthropic
endeavor. That’s what most people do in this country when they have success,
which is they set up foundations. you see these enduring foundations, Carnegie
Mellon, go back and look at what Bill Gates is doing. These are transformative things.
So creating ways for that kind of capital that’s generating the private
sector to easily work against some of the problems in society, and also bring
its innovation, right? And its kind of intellectual capital at the same time. I
think it’s just a real win for the citizens of the country. – That’s fantastic. Well
one reason we’re really glad to have you at our conference is that we think of
this conference is sort of a microcosm of some of the concepts you’re talking
about. The bipartisan ship is there on display. You got
on the stage immediately after the Republican Governor of Utah and you guys
had slightly different messages, but basically saying the same thing, which is
that everybody ought to join hands together and let’s collectively focus on
solving some of these problems. The other thing that you get here which I think
is a perfect sort of illustration of what you’re talking about is we have folks
representing every sector of society. The panel of folks that we had come on
stage just after you were sort of the world’s pre-eminent academic experts in
the entrepreneurship and kind of impact investing ways. So we
have the academics here, the nonprofits, social enterprise, private sector
interest, and then of course policymakers. And getting all those folks in the same
room to talk about issues that affect us all is a really powerful
approach. So we’re tremendously honored to have you with us. Thank you so much
for taking the time. Thank you for your leadership and conference with us. -Thank you. Thanks again.

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