Bridging Toward a Better Future

The Wharton Public Policy Initiative will connect Washington, academia and business in unprecedented ways, and seeks to provide solutions to some of society’s toughest challenges, including partisan gridlock.

 By Matthew Brodsky

 

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Professor Mark Duggan. Photo credits: Colin Lenton.

In the spring of 2009, Mark Duggan ventured from the ivory tower of the University of Maryland to the political swamp of Washington, D.C. Remember that time. The financial world was frozen in fear. The economy knew no bottom. Freshly inaugurated President Barack Obama was eager to make good on his promise of health care reform.

Duggan was recruited by Christina Romer, at the time the chairperson of the Council of Economic Advisers (CEA), to assist in making that reform a reality. Duggan had worked at the intersection of health care and public policy since graduate school in the late 1990s. His research focused in large part on Medicaid and Medicare (two government programs that insure more than 100 million Americans), as well as private health networks. He was also familiar with several of the economists working at this executive branch agency, including Austan Goolsbee.

Through his 15-month tenure at the CEA, Duggan came into contact with many other federal agencies and gained an intense, firsthand experience of the executive branch. Interviewing Duggan gives one the sense that he saw things in the trenches that he is not ready to share, though it sounds like he had an overall incredible and positive experience.

One story he divulged was of the time he strove to devise and propose reforms of Social Security and Medicaid with reductions to federal deficits in mind.

“They went nowhere,” he says.

This is not to say that the federal deficit was not a problem then or that policymakers were oblivious. Duggan’s complication at the CEA was that America was in the midst of a historic economic recession; politicians were not willing to aggravate the situation by cutting entitlements for tens of millions of Americans.

“With changing policy, timing is everything,” he says.

For his primary purpose in D.C.—health care reform—the timing seemed to be perfect. One aspect of reform he focused on was its impact on businesses, small employers in particular. He and his colleagues at CEA produced a research brief—“a little 20-page report”—that became a resource for policymakers. It delivered economic evidence that shed light on what the 1,000-page Affordable Care Act would do for small businesses. An electronic copy of the report can be found on the website of the Council of Economic Advisers.

“I think that this really did lead to somewhat more support from the small business community,” Duggan says. “At some level, I think that was a case where the analysis that I did was informative for people and helped to potentially get better policy outcomes.”

Now Duggan is armed to educate on a much grander scale as faculty director of the new Wharton Public Policy Initiative (PPI). The time is right, and he is wielding the analyses and expertise of countless peers and colleagues—a “huge arsenal of research,” as he describes it.

A March on Washington

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Andy Coopersmith, managing director of the Wharton Public Policy Initiative

“The theory is to try and build a pipeline between Philadelphia and Washington to get relevant, timely, nonpartisan, intellectually thought-over information in the hands of key staff decisionmakers as they make and guide economic decisions,” says Marc J. Rowan, W’84, WG’85, senior managing director and co-founder of investment firm Apollo Management LP and one of the generous donors whose $11 million in funding helped launch the initiative.

Rowan lauds Duggan’s caliber of intellect, his experience (having survived the capital and “lived to tell about” it), and his reputation on campus for his work as a professor of both business economics and public policy and health care management, as well as the chair for the Department of Business Economics and Public Policy.

Listening to Duggan speak, one can sense his devotion to his research and to the Public Policy Initiative—and his optimism. For instance, he does not doubt that the time will come for policymakers to cross party lines and address the long-term fiscal challenges of the United States, instead of punting the country’s problems to the next generation with a short-term fix.

“Somebody bringing that passion to this is going to be critical in terms of making it successful,” says Marc A. Spilker, W’86, president of Apollo Global Management and Rowan’s co-donor to PPI.

Also crucial are the dedication and efforts of PPI Managing Director Andy Coopersmith, respected on Penn’s campus for serving as the first administrative director of the dual-degree Vagelos Program in Life Sciences & Management. Public policy work connects with Coopersmith’s background in economics and history, and the opportunity to once again be involved with a program’s genesis attracted him.

PPI is a major “academic startup venture” with an unprecedented, innovative and impactful mission, according to Coopersmith.

That said, there is much to do.

“We’re working on so many fronts simultaneously [during this] critical stage of foundation building,” Coopersmith reports.

One of the first tasks at hand is to build awareness among the faculty and staff on campus, and throughout the entire Wharton and Penn community. Silos of public policy knowledge already exist across the entire Penn campus. PPI will serve as a hub for existing knowledge and research-to-be.

At Wharton alone, faculty possess expertise on many of today’s most pressing public policy issues. Robert Inman, the Richard King Mellon Professor of Finance and a long-standing repository of public policy wisdom at Penn, goes down the checklist: health care management—the best in the country; social insurance—as good as anywhere else; finance and policy—Wharton is known for finance, after all.

“You can pick some of the biggest problems. You can pick health reform. You can pick tax reform. You can pick real estate reform. You can pick international trade. You can pick banking. People here have lots to say on those topics,” Rowan concurs.

For the staff, students and faculty at the Wharton School—and the rest of the University of Pennsylvania— Duggan will help channel their new and continuing research efforts and translate them into forms useful for policymakers in D.C. PPI will empower some researchers with larger stages for their work and enhance the visibility of those already active in policy debates.

Now, PPI will translate their research for policymakers, staffers and media members who populate the real world of Washington.

If the faculty cooperates, that is.

Coopersmith notes, “It would be easy to imagine that there would be some territorial sensitivities.”

Not only must Penn’s professors cross department lines and share—they must do so eagerly.

“For this thing to have substance, it will need faculty to be excited about it,” Duggan says.

And they are. PPI is already being received as a “positive force” around campus, reports Coopersmith.

“We’ve not had a focal point [or] a basis from which to build,” Inman says about how the past looked for himself and his colleagues involved in public policy research, adding: “I think the future looks fantastic.”

(Read about what is expected from PPI over the next three years in our timeline for the Wharton Public Policy Initiative.)

Keeping It Brief

That leaves the next step in PPI’s early stages: produce the goods. For all of its promise and for all of the expertise on campus, the initiative will be for naught if it fails to provide outstanding knowledge in a form that Washington can digest.

“If you build it the right way in the first instance, which is you create the awareness, you create a good experience, you actually add value … then you’re going to have repeat buyers,” Spilker says.

“In the world we live in today, things get decided really quickly. And often people can’t do the work that they need to do in order to really dig into an issue, and to be able to inject understanding into that decision-making process is really at the end of the day what this is about,” he adds.

“We’re going to give policymakers a sense of the possible,” Inman says for all faculty participating in the initiative.

That sense will first come in the form of policy briefs that distill the complexity of faculty research. By the spring of 2013, the goal is to have numerous policy briefs in circulation in Washington in paper form as well as on the new PPI website. (See the side story on P. 28 for more on the PPI timeline.)

Another target: an eight-page limit for briefs—a length meant to allow policymakers to read the brief during their commute on the train. PPI briefs will not be laying out a course of action to be taken. They are not primarily about advocacy. The hope is that policymakers will integrate the knowledge they gain from the briefs into their own actions and decisions.

Faculty such as Jennifer Blouin, an associate professor of accounting at Wharton, were busy in the fall with the first briefs. Blouin focused hers about business taxation and whether U.S. corporations are paying “their fair share.” Her goal was to create a document that gives policymakers a “true lay of the land”—on what the tax burden is for corporations, partnerships and other private entities; what this tax burden means; and why companies do what they do in response to it.

“The short, approachable piece is tough,” she confides about her eight-page limit.

Yet Blouin is attracted to continued work with PPI. After all, her research focuses on one of only two things that are certain to cause people grief in their lifetimes, to paraphrase Ben Franklin.

“People think public policy and they leap right to tax,” she says.

As for condensing her research into a handful of pages without losing the depth and the key takeaways, Blouin has the assistance of Nadia Tareen, a sophomore in the College and Wharton who is helping to turn source data from the IRS (statistics of income data) into highly approachable visuals.

Student involvement is one of the more exciting aspects of the initiative. Undergrads and MBAs will come on board to supply strategic know-how about growing startups, help faculty craft briefs, and provide communication and website support.

Spilker emphasizes that he hopes the initiative will instill in Wharton students an understanding of how governments and regulation—not just in the United States but worldwide—are now playing larger roles in business and finance.

PPI could also be a launching pad for students interested in public policy work, whether as a matter of career exploration during or immediately after school or as a long-term career pursuit.

Why Wharton, Why Now?

The goal of the Public Policy Initiative is to spread Wharton and Penn knowledge across government agencies and congressional offices. A cynic might wonder if it’s possible to reach one policymaker in today’s hyperpolitical climate.

“I share [the] skepticism, having served in D.C,” Duggan says. “The current setup in D.C. couldn’t be any less conducive to good policy.”

The School has two options when faced with this reality.

“One is to throw your hands up and run away, and the other is to roll up your sleeves and run towards the problem and try to figure out how to solve it,” Spilker says.

For the latter course, Duggan is optimistic and galvanized. He believes that people in D.C.—not just those involved in government, but the media as well—long for expertise and objectivity rather than the advocacy they currently receive. Alumni who work in D.C. have expressed their appreciation for the potential of the initiative, encouraging and confirming Duggan and Coopersmith’s sense that there really is a need for data-driven, agnostic analysis of major public policy issues.

Research and knowledge are not easily accessed by media and policymakers and staffers alike. That is why they often take an “easy road” to find information.

“Policymaking right now is dominated a lot by organizations that are like advocacy organizations,” Duggan says about so-called think tanks.

Partisan research organizations, though typically flush with funding, still cannot match Wharton, a “giant” in terms of the breadth and depth of its faculty expertise (not to mention what the rest of Penn’s campus brings to bear), according to Rowan.

As far as true academic research centers go, Wharton is the closest of the elite business schools to D.C. when measured by longitude and latitude. Stanford’s Institute for Economic Policy Research, which has been in operation for 30 years now, is nevertheless nearly 2,500 miles away. Established academic policy programs, such as those at Georgetown, Harvard and Berkeley, do not have much to say in aggregate about how policy-making impacts the financial and business worlds, Duggan stresses.

“Wharton has a really special reputation in D.C. for both business expertise and for being apolitical,” Duggan attests.

The impact of this reputation cannot be underestimated in D.C. or other capitals. When Inman travels in public-sector circles, for instance, he makes sure to introduce himself as a professor from Wharton.

“The wider world knows Wharton as an outstanding center of research and teaching,” he explains. “It’s that name that will get the initiative the opportunity to be a big success.”

Wielding the Wharton brand, the initiative is poised to enter Washington at an opportune moment. Duggan insists that the timing will be perfect. There are many policy issues on the horizon—a window of opportunity for wisdom and insight to be imparted.

“I think what we’re trying to do is not rush at something that is timely only because of one election but is ultimately important long-term,” adds Rowan. “We will no doubt go from crisis to crisis and from opportunity to opportunity. The constant is: Government is a very important part of the economy.”

To have a lasting and real influence among policymakers, Duggan does have one major challenge left in the establishment of PPI: the hiring of a D.C.-based executive director who will be the very visible “manifestation of the University” in Washington, as Rowan explains. The executive director must be someone who has the respect of both sides of the aisle in Washington, as well as the intellectual capital to be able to connect with the heavyweights on Penn’s campus. He or she must also be fluent in current policy issues and have the ability to foresee emerging issues and direct research accordingly.

“The person has to be viewed as nonpartisan, as wanting to do the right thing and as being able to navigate the vast library of knowledge that already exists here,” Spilker says.

The executive director will likely have been hired by the time of this article’s publication. Teamed with this point person in Washington and Coopersmith on campus and armed with the collective knowledge of his colleagues, Duggan can move forward to transform his ambition, optimism and talents into real-world change—if only to adjust the dial on how things get done in government.

“The country needs these sorts of initiatives if we’re going to get to a better place in terms of policy,” he says.

Editor’s note: Read our side story about the expected timeline for the Wharton Public Policy Initiative.

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