Full Interview: Former Microsoft CEO Steve Ballmer discusses USAFacts, his “10-K for government”

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Former Microsoft CEO Steve Ballmer launched his new nonprofit venture today, aiming to give everyday citizens the same type of information about the government as corporate leaders and investors have about companies — revenue, spending, risk factors, and detailed results.

It’s called USAFacts, and it’s akin to a 10-K for government, referring to the annual report that companies make to the Securities and Exchange Commission and investors. We sat down with Ballmer recently to talk about the project, and we’re featuring our full conversation on this special episode of the GeekWire podcast.

Listen to our full interview with below or download it as an MP3, watch the video above and keep reading for an edited transcript. 

GeekWire: Your new project is called USAFacts. You’ve described it as a 10-K for government. Can you explain what it is?

Steve Ballmer: USAFacts is an initiative, if you will — which we’ll publish in PDF, we’ve got a nice website, a lot of different things — but it’s an initiative designed to really simplify and give clear focus to what’s going on with our government. How much money do we take in? How much money do we spend? Against what set of goals? And what kind of outcomes does government get? We take a whole new perspective. We innovated in a number of ways. You won’t find anything like it on the web. We innovated in terms of taking a decision-maker focus — being goal-oriented, not program-oriented.

RELATED: Steve Ballmer launches USAFacts, using business principles for an unprecedented government report

We looked at the Constitution and said, “what’s the mission of government? Let’s break it down by mission and ask how we’re doing.” The 10-K analogy isn’t bad, but unlike a business, it’s about what you achieve for the citizens first and then how you pay for it as opposed to making money, if you will, or making a profit. We are very citizen-oriented, so it’s not just what the government does for citizens overall, but it’s what the government actually does for specific groups of citizens. And so we look at 10 different groups of citizens and we say, “How does what government do impact a variety of different citizen types?” And that’s kind of what we are.

We have innovated in other ways. We only look at actuals. A lot of government is forecast. For businesses, when you’ve got to present yourself you get to speculate, but you’ve got to be rigorous about the actuals. We use government numbers, because every business is supposed to use its own numbers to make its decisions. So we took the numbers government is looking at because that’s the best representation for citizens of what’s going on with their government. That was an innovative thing.

We built a platform that can take on not only new data sets and new ways of becoming relevant and interesting but also new users — not just citizens who are very interested but journalists, policy wonks, etc. We’ve simplified things. Government is complicated, but we still provide detail that backs that simplification up. I’m pretty excited about it.

GW: It’s been said that we’re in a post-fact world. Do you buy that? And if not, why is this initiative so important?

Ballmer: I don’t buy that we’re in a post-fact world. People talk about alternate facts, they talk about fake news and yet at the end of the day the facts, particularly the numbers, they are what they are. They tell us about the past. They give us an ability to, ourselves, judge the forecast that we all have for the future. There are a lot of reasons why people believe what they believe about issues of government and politics. But you have to ground those proposals in a real understanding of what has happened and what the numerical outcomes have been in the past — and I don’t really think that’s going to change.

You can have an opinion on what should happen about foreign aid, but in any context, you should know: what’s the real foreign aid expenditure? How much of it was military and how much of it was economic? How much of it was spent in Iraq and Afghanistan versus in Kenya and Tanzania? When you go to talk about the subject, no matter how you shake out on it, you should be grounded in the facts.

GW: Many people know you as the former Microsoft CEO, the owner of the Los Angeles Clippers. Why did you decide to do this? Because it will seem, to some people, kind of out of left field.

Ballmer: I’d say there’s probably two reasons. Number one, I’m a numbers guy. I really like numbers. That was part of my je ne sais quoi, if you will, at Microsoft. And I think the appropriate role of numbers is to help to take complicated situations and simplify them for people to understand. I liken it sometimes to Tom Brady seeing the playing field. To see the playing field, oftentimes it helps to have some simple group of numbers that really let you understand what’s going on, and I enjoy that.

The way I got to this specific challenge is in a discussion with my wife, where she was talking about where we go in terms of our philanthropic and civic work. And our focus is on kids who grow up in situations where they’re probably consigned to the economic status into which they’re born. If they’re born very poor, they are consigned — in high probability — to stay very poor.

But when we started on this, I said to my wife, “You know, we don’t have to worry about this quite as much. If we pay our taxes we can feel good because government is primarily sending our money to the poor, the sick, the old, defense and education, those are the big things.” And she both challenged me that we couldn’t make a difference but also interested me. And so I said, “Look, I want to have the same kind of data as a citizen to assess this that I would have had as a CEO of Microsoft for Microsoft’s operation.” And I sort of gradually got into this.

I looked for a government 10-K, because that’s what I would do if I was trying to assess a business that maybe Microsoft was looking at acquiring. There are things that exist on the web that are bits and pieces that you can find, including a nice piece of work that’s done by the Treasury Department. But nothing that said, “Here’s our goals, here’s what we’re spending against them, and here’s what kind of outcomes we’re getting and we’re going to do that in a way that a normal human being could understand.”

GW: What did you learn? How did this change your perspective of government, and was there anything that surprised you?

Steve Ballmer discusses USA Facts (GeekWire Photo / Kevin Lisota)

Ballmer: Yeah, a number of things surprised me. First thing, government does a lot, and yet you can simplify it into four big areas and maybe three to four sub-areas in each one of those. And if you talk about 14 different areas, you really can completely have an excellent discussion. Government is not as complicated as it appears, I would say, in the popular press. That actually is very important learning.

Number two, that we need more timely, more consistent, more thoroughly organized numbers in order even for government decision-makers to do their job. I hear tell as the new administration comes in — you see a lot in the newspaper — that just finding all the data in the simple digestible form isn’t as easy as it might be. I learned that government does a lot of things very well, at least from my perspective. A number of things — crime rate — they’re getting better. Some people would say they need to get better faster, some people would say they need to get better in ways that involve more incarceration or less incarceration, but you can’t complain about your crime rate getting better. That, I think, would be uniformly respected. That’s a very good case.

The emissions produced per American has actually turned the corner and is coming down. Depending on your perspective on climate change, you might view that in a different way, but it can’t be bad for anybody that that’s what’s going on. We do have a federal budget dilemma, but the states are relatively well-run.

Much of what we actually think about government is done at the state level, it’s not done at the federal level. If you look at the roughly 24 million people who work for government, over half of them work in K-12 and state institutions of public learning. Well over two-thirds of the people actually work for the state government, they don’t work for the federal government. I learned that.

I learned a lot of people who work for government actually are running businesses for which there are private sector counterparts. Picking up the garbage, running hospitals — and I’m not saying that things should necessarily be privatized, but there’s an easier basis for measuring them because they do have private sector counterparts, which is very, very important. I do have a better sense of how we come to a deficit, and I have more ideas about how you might solve that. The Democratic process has to pick the right solution. There are many ways to get there, and I’m not going to hold forth on whether it’s more taxes, less revenue, this kind of tax, that kind of tax. The Democratic process is going to have to figure that out. But I have much greater clarity in my own mind of what the real option set would be from which people can choose.

I know that a lot of people in this country have great opportunity to live the American dream, to move up, to participate, and I know there’s a number of people who really don’t have a high probability at the American dream. And that confirms what my wife and I were thinking about civically. And I can keep going, but there’s a lot of interesting things out there.

GW: What do you hope the average citizen will do with this information?

Ballmer: Number one, we produced a very condensed form of what we call our annual report. It’s about 40 or 50 PowerPoint slides, mostly with pictures on them. I would hope people would read it, and it would help them have a clearer view of what goes on in government. How it’s funded. Who’s paying for it — a lot of people say, “Oh, so and so pays too much, too little, too this, too that.” What the money is going to. What outcomes people are getting. Just to help tune people up on, “well, that doesn’t look like what I see.” Or, “gosh I see that,” or “I never thought about that before.” And I’m hoping at least people who would be interested in reading any other publication that focuses in on these things would find it interesting. That’s number one.

Number two, we’re trying to have a resource so people with questions can find answers to them quickly. And we’re not going to answer every question, and we’re going to have to update the data. We’re going to have to do more things for people to see what the experience might look like where they live. So there’s a lot of work to do, and we will have to go do that work, but I hope to be a source for that.

For journalists, I hope to have a source so that when people want to do a quick analysis of what’s going on on a topic that comes out, the numbers are there to paint a specific picture for readers. Certainly, as news topics come out, we will produce little vignettes that talk about the issues from a numbers perspective and from what has happened actually. What’s going to happen in the forecast? There’s going to be a lot of people talking about that. I think it’s hard to assess the forecast unless you can look back.

When I worked at Microsoft, we’d be in the sales forecasting process. It would be time for the budget for next year, and sales forecasts always started low and then hockey-sticked up! That’s just what sales people would say. And I often found that if you let Excel just draw out a trend line it probably was a better estimate of what would happen than the forecast. Oftentimes in these government debates it sounds like people are going to say “Well, if we do this, boom! The world’s going to change completely.” And while there are decisions government can make that actually do change the world completely, more often than not the future looks like the past.

GW: This is an important question to ask. I think I know the answer, but I want to get your answer to it. Do you come at this with a partisan agenda?

Ballmer: I don’t. This work has to be non-partisan, otherwise it’s worthless. And we’re using government numbers, and we’re summarizing them to the best of our ability. We bring them together, we let people look at more data if they want to. So in no sense do I think it is partisan. We’ve tried to let people on the right and on the left take a look at our work, so we have some check and balance. It’s hard to see how it would be partisan because all we’re doing is taking what the government produces and simplifying it a little bit, and holding it in front of people. But I think it’s important that the work not be partisan.

Now for me personally, there are issues I care about. I care a lot about the plight of kids who are born into very, very difficult circumstances, and I’ll wear that on my sleeve. That’s not OK, in my opinion. The data speaks as the data speaks on that, and certainly, there’s nothing we’ve done to bias to that agenda.

GW: Have you had interactions specifically with President Trump or with the Trump administration about what you’re planning to do? And how do you expect them to use this?

Ballmer: I haven’t had any discussions with either the President or people in the administration. I would hope that even for people who are deeply involved in government, this is a good resource. Whether it’s the staffer on Capitol Hill, or the decision maker inside the White House, or in Congressional staff, or Congressman, or Senator. Over time, what would be nice to have is for government to produce something like an annual report itself, that every legislator had to sign off on. To at least say, “Yes I’ve read this and this accurately reflects the information. This is what I’m going to do about it, but this is the true state of where things are in our country.”

GW: It seems almost inevitable that this could be used for political purposes, or that there could be a backlash. There is such a polarized environment out there in the world right now. Are you prepared for a backlash, and if it happens what will you do?

Ballmer: Well, of course, in a way it’s fine with me if this gets politicized. That is, I hope this is a source of data for people on both the right and the left. The point here isn’t to say, “We know what to do.” We know how to inform that discussion. And for anybody who’s going to pick its numbers and put them out of context, for anybody who’s going to not use accurate data as presented by the U.S. government — sure, I’d call them on it. Whether they’re on the left or on the right, I would call somebody on that. If there’s some kind of backlash, fine. I’m a private citizen. I’m paying for this with my own money. I’m retired in life. So what? It’s a contribution I think I can make. I don’t know if I can make it uniquely, but I put in time and energy. I’ve been inspired by the work of others. But, eh, bring it on. It’s OK.

GW: As you said earlier, you’re a numbers guy. You were renowned at Microsoft for finding the one line on page 89 of the PowerPoint deck that you went after your product teams to get right. If those product teams were the US government, is there one thing that you just see as obvious from the data that needs to be fixed?

Ballmer: Yeah, I would probably say three things. Number one the data needs to be more timely. Because some of it’s not very timely, and if I was the decision maker I’d want it to be more timely. Number two, I’d like it to be more consistent over time. When metrics change, it’s very hard to compare the apples and oranges.

GW: I hated that when you guys did that at Microsoft.

Ballmer: Right, whenever we changed the way we reported our numbers the investors went crazy! Yeah, we did it, and I’ve learned that doing it very frequently is not helpful for outsiders, it’s not a helpful in terms of the way you run the business or run the organization or run government. So that’d be the second thing I say.

The third thing I’d say is there is some inconsistency between numbers presented by various parts of government. I would say it’s very important for government to come together and understand that, and come up with a consistent form of presentation. And then last but not least, if you’re trying to measure outcomes, there are numbers that seem to me to be just missing.

I’ll give you an example. We can tell you exactly how many people are in prison, for what crimes and how long they stayed there, pretty much. Not everything you might want, but pretty obvious things. The thing we can’t tell you is about jail. We can tell you on the one day of the year that government measures, there’s about 750,000 people in jail. What are they there for? Do people stay on average in jail a day, a week, a month? How many people are there because they were arrested versus for probation violations or some other issue? Can’t tell you that. We can’t tell you how many people were stopped and released without ever being either arrested or put in jail. That’s very important if you want to understand issues of harassment and policing. So I’d say there’s missing numbers, if you’re a decision maker really trying to drive strategy on this stuff and really talk to the citizens about it.

I would say from the citizen’s perspective, there’s actually pretty good numbers — if you’re willing to work them hard — from various government sources. To, for example, tell you, what does the experience look like for somebody who’s in the bottom 20% economically versus the 20% next step up? Or, what does it look like if you’re single without kids, or single with kids? So it’s pretty good, but you have to do a lot of work to put it together. And I would suggest that government would be better-served to package the numbers — not only in terms of monolithically what might happen — but to save the rest of us the work of doing essentially a bunch of tying of databases. Because government needs to know how its policies impact these smaller groups of people. That’s not just something that analysts like us need to know.

GW: As you mentioned, this is not just about the federal government, as you’re tracking a budget and the way the money is spent. There’s obviously vast local and state institutions — in fact, there’s 90,000 independent jurisdictions according to the research by the USAFacts team. How much of that are you able to capture in this first version?

Ballmer: We capture everything in the first version, in a sense, and in a sense we don’t. We can tell you the aggregate of state, federal and local very well and I think it’s important. Education funding comes from local government through property tax, it comes from state governments and there’s federal money that comes in the form of dollars to fund programs for less affluent kids or kids with special needs. So if you really want to look at what gets spent on education you can’t ignore local, state or federal. So we put them together. And then we can tell you what the aggregate outcomes. What does proficiency levels of kids in fourth grade in the United States look like? That information gets published.

But if we wanted to channel it down and say what has the experience looked like in the city of Detroit? Or the city of Bellevue, Washington, where we sit today? Or what happens not in L.A., where we have a basketball team — L.A. County is so big you might actually want to even be able to look at neighborhoods or subdivided groups. So I think that’ll be an important next step for us. What we’ve done today is load all the data in aggregate, and look at it nationally in aggregate, and now we need to break it down from there.

GW: The 10-K analogy will resonate with many people who follow stocks and businesses. I understand that you actually have former Microsoft lawyers, people who worked with Microsoft, developing something that’s exactly like a 10-K as part of this. What was that process like? Because that’s fascinating.

Ballmer: Well, we have the website. This is a modern day and age, so we have the website. We’ve got the PDF, and the PDF is very important, because some people like a linear read, and I think that’s important. But we also have the equivalent of a 10-K, which has a certain kind of analysis associated with it, which we also created to the best of our ability. It exposes other risk factors — again we can’t certify that these numbers are audited or anything else, but we did try to take that analytical approach. And for somebody who wants to really roll up their sleeves, not just on the history of the last 37 years — because we go back to 1980 on many things — but to really look at what the changes have been, and why, over the last several years, we’ve taken an approach that people who read these documents for business purposes all the time will find very, very familiar.

Why did we do that? Because there’s a discipline to it, because we have people who understand how to do it, and yes, we’ve been having people with financial and legal backgrounds go through it for us.

GW: What would success look like for USAFacts five years from now? What would change in the way government is run and the way citizens interact with their government? How would you define success in this project?

Ballmer: I would say that one of the things the dialogue really does focus on a lot is: how do we make good, solid, grounded decisions — bi-partisan decisions — in terms of where our country goes forward? I do know that when reasonable people — who may disagree — when they look at the same data it’s easier for them to grow closer together. And I hope that’s not true just for politicians but also for citizens talking to their friends, their family members. We’re going to have to keep working on this so that it’s more broadly applicable. We’ve hit a certain kind of audience, and I’m sure we’re going to have to make it both more technical and complicated, but also even simpler and easier to understand.

But if we can be a small part of the dialogue that provides the common data on which reasonable people can agree before they air their disagreements, I would consider that a great thing. And  we hope to drive this stuff into educational curriculum, into the media, further into consumers, new topical stuff. We will work very hard to keep it timely, relevant, and even more relevant to individual people than it is today. And how many users that winds up being on a website, eventually of an app — we’ll have to wait and see. But I do see a lot of opportunity, and what we’ve done today, to borrow a technical analog, is we’ve built a platform. We’ve built out the first app or two, which is a PDF that you can go read and a website that you can query. On the other hand, there are many other applications that can be built off the platform.

GW: So that implies you could have like an API that third parties so that could come in and build things. Is that part of the plan?

Ballmer: We’re not in a big tech company anymore so we don’t have a specific plan right now! But the truth is, yeah, we’ll have an API for this thing. It’s important. If you look at most of the government databases, some of them have an API but most of them you just download a file and work with. Even in our first version, we downloaded files and uploaded files. What we will do going forward is connect our database directly to these databases, do the import, and start providing APIs. Our front end — the front end of our website — calls the back end through a set of REST-style APIs, and we can publish them so that other people can use them, and that’ll be I think an important opportunity for us going forward.

GW: Just extending the business analogy — we as taxpayers have for decades, centuries, been making an investment in our government and expecting an outcome, and this alludes in part to what you said earlier. How should we feel as ‘investors’ in the US government, based on the data that you have found?

Ballmer: This is part of the issue: everybody’s got their own notion of what’s important. So how you feel may be different from how I feel or somebody else feels. I look at this stuff— with my value set, what’s important to me — and I feel better than I did, by and large. And yet I see things that don’t seem OK to me. I don’t believe long term we can continue to run a deficit. I don’t know how to get there, but that probably doesn’t feel good to me unless something changes. I don’t think it’s okay for there to be kids that are born in a world where they don’t see much opportunity from the get-go. I don’t like the fact that reading proficiency scores, the percentage of kids who can read proficiently in fourth grade, that the numbers not growing more for the increased investment we’ve made in education.

On the other hand, from my perspective, other things seem to be improving a lot. Crime’s getting better, traffic fatalities are getting better, the average age to which we live is getting better. Bridges, infrastructure seems to be, by and large, getting better. May not be as good as some people think it ought to be, which is fine. The degree to which peoples’ lifestyles are a little better than I thought they’d be, wherever they are on the income spectrum. I thought the bottom was even worse than it is.

So I think there are things in there that I feel good about, things that I think should be better. But as I said, what I care about, what you care about, what you know the many TV commentators that want to talk about this topic care about — everybody’s entitled to care about what they care about. And everybody will see something different in the numbers, and we think that’s a wonderful thing. I just will tell you some things don’t seem as good as I’d hoped and many things seemed better for me, but we’ll see what other readers think based upon their own view of the world.

GW: And it sounds like the most important thing is for those feelings to be informed by actual facts.

Ballmer: Exactly right.

Conclusion: So above is the Full Interview: Former Microsoft CEO Steve Ballmer discusses USAFacts, his “10-K for government” article. Hopefully with this article you can help you in life, always follow and read our good articles on the website: Ngoinhanho101.com

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