Using short-term data to justify spending cuts is dangerous

When White House Office of Management and Budget Director Mick Mulvaney defended the Trump administration’s proposed deep cuts to social programs, the words “evidence” and “results” came up repeatedly.

“There’s no demonstrable evidence they’re actually helping results,” Mulvaney said. Journalists quickly scrambled to set the record straight, citing evidence ranging from after-school programs’ impact on graduation rates to how meal-delivery programs have reduced Medicaid costs.

Mulvaney picked a poor example to buttress his argument — Meals on Wheels happens to have very strong success data. But, more crucially, he misguidedly justified spending cuts with the very approach that could finally tackle intractable social problems: collectively orienting programs and funding around results or outcomes.

Our country relies on nonprofits to deliver critically important services to U.S. communities. But the social sector has little hard data to know what really works, and government and philanthropy have helped to create this evidence gap. Grants and contracts traditionally come with strict requirements for short-term outputs and minimal (or zero) allowance for gearing toward or measuring longer-term outcomes.

A nonprofit operating a homeless shelter is lauded for reporting that 90 cents of every dollar goes directly to beds filled, warm meals served, job training or drug counseling sessions attended — all important, short-term program outputs. But how do we measure that nonprofit’s contribution to ending homelessness?

To help answer that question, the nonprofit needs trained staff with desks, computers and systems to collect data on things like transitions to permanent housing and jobs held long-term. More likely than not, neither its foundation grants nor its government contracts account for or cover these costs — and the nonprofit has many other, daily survival claims on that remaining 10 cents.

Identifying, organizing around and funding what really improves lives in widespread and lasting ways requires collaboration, culture change and resources. We are proud to be part of a growing, cross-sector and bipartisan movement of service providers, funders and impact investors working to collectively reorient around outcomes and results.

There are many examples of this approach already at work. Los Angeles is showing how supportive housing can significantly lower hospital costs of treating homeless patients. In blue states and red states, Nurse-Family Partnership is expanding a relatively inexpensive service that’s been shown to improve the long-term health of young mothers and their babies.

In Maine, healthcare providers, homeless shelter operators, substance use treatment programs and law enforcement are collaboratively tackling the opioid crisis. Nationwide, big hospital systems and local nonprofits are exploring partnerships that connect medical services with supports for housing, healthy food and transportation.

We are all learning and applying important lessons about what works and how to measure and keep supporting it. We must invest and cut red tape so that nonprofits can keep doing the important work with which we’ve entrusted them. Those nonprofits can then develop the muscle to capture their data and demonstrably help to deliver the outcomes we all desire.

We also must embrace the fact that critical resources, like arts projects, community centers and in-home meal delivery services, create the kinds of lasting, positive impact that aren’t easily measured.

Every funding decision is rooted in priorities and values, and these may at times be the subject of fierce debate. But leaders of all sectors must demonstrate that our roadmaps and decisions are firmly rooted in strong principles, and steer clear of inappropriately using numbers as justification for our decisions.

When the federal government invests in a program like Meals on Wheels, it isn’t only helping to improve the health and well-being of millions of people; it is also sending a message that people have value even if they cannot get out of the house.

When Health and Human Services Secretary Tom Price recently said, “We ought not be measuring programs by how much we put into it. We ought to measure them [by] whether or not they work,” his words were 100-percent right. But using them as the main rationale for spending cuts is dangerous.

The social sector and its leaders would welcome the opportunity to share our experiences and expertise with the administration — including the new White House Office of American Innovation — and with Congress as we move forward in the 2018 funding cycle.

Authors: Antony Bugg-Levine, CEO, Nonprofit Finance Fund; Dan Cardinali, President and CEO, Independent Sector