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Don't Eliminate Our Department of Finance

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With Delaware struggling through the most serious recession since the end of World War II, on July 5, Governor Markell made a startling announcement proposing to eliminate our state Department of Finance. Surprisingly, the governor’s 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 yet) has stirred little discussion.
 
Perhaps that’s because the General Assembly, exhausted from dealing with $800 million in budget cuts, is now out of session and welcomes a break from financial discussions. Perhaps it’s because all of the state government’s finance leaders—the secretary of finance, the directors of the Office of Management and Budget and the Delaware Economic Development Office (DEDO), the chair of the Delaware Economic and Financial Advisory Council (DEFAC) and even our current state treasurer were appointed by Gov. Markell. 
 
Regardless, it’s important that voices outside the administration speak up and give the public a means to consider the long-term implications of this proposal—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 major arguments against dismantling the Department of Finance.
 
First, in times of economic crisis, the secretary of finance should serve as the governor’s primary financial advisor. As witnessed by the lead roles undertaken by our nation’s finance department (the Department of Treasury) in Washington, the leader of the finance department must serve as the key advisor to the governor on a variety of financial issues that impact the state. With a staff of professionals that closely monitor our state’s finances, this individual, along with the state treasurer, should be the point person in developing a strategic plan to weather the economic storm. By placing emphasis on eliminating the finance department, this misdirected energy has crippled an important resource and depleted the political capital of its leader. While the current governor may elect not to use our finance department and its secretary (which is well within his right), it does not mean that future governors will downplay the significance of this important cabinet figure.
 
Second, eliminating the department will not result in significant cost savings or efficiencies. Isn’t the current proposal just a fancy way of reducing the size of the governor’s cabinet and number of state departments by one at the expense of a trusted economic advisor? If the employees of the Department of Finance’s three divisions are reassigned to other agencies, what will be accomplished? For now, it appears that many state employees are being relocated—on the organizational chart at least—to generate a savings of one, maybe two, salaries and claim that an entire department has been eliminated from state government. Saving the salary of the finance secretary does not outweigh the benefit of having a trusted advisor at the decision-making table. In an economic crisis that impacts all Delawareans, we must not sacrifice leadership in the name of minimal cost savings or efficiency.  
 
Finally, eliminating the department would remove one of the essential checks and balances among the financial offices within our state government. Like weights on a scale, our finance secretary, agency directors, advisory councils and state treasurer provide important checks and balances as each offers independent analysis of the state’s economic status to the governor, the General Assembly and the people. Removing a single weight from the scale and changing the reporting structure will fundamentally change the delicate balance that supports the financial structure of our government. Without serious discussion and planning, eliminating a department at the whim of any given governor would place our state government in a constant state of flux and could encourage talented staff to seek more stable employment. 
 
In any debate, we must be open to new ideas and opportunities, including revamping the Department of Finance to meet fresh challenges. This department, and its talented workers, should be instrumental to our economic recovery. They deserve to remain where they now stand within our state government—as an important pillar in the foundation of our state’s financial system.