Open Data in the Age of Trump


This blog was originally published by Executive Director Hudson Hollister on January 7, 2017 on LinkedIn and Medium.

In January 2012, I resigned from my Capitol Hill job to start an organization that I called the Data Transparency Coalition. Now called the Data Coalition, we are the world’s only open data trade association.

We are entirely supported by contributions from our members: big, established companies like Experian, PwC, and IBM and surging startups like data.world and FiscalNote.

Our mission is both simple and ambitious: government information should be published as standardized, machine-readable data.

Our reasons? We have three. Open data delivers transparency for the public, enables better management within government, and makes compliance cheaper, through automation.

Our methods are old-school: persuade Congress to enact open data reforms and encourage agencies to embrace the transformation, usually in business wear. This is our policy agenda.

Our organization’s entire history has been with divided government: Republican-controlled House of Representatives and later Senate, facing a Democratic administration. Donald Trump’s inauguration this month will change that.

The President-Elect has not promised to bring technological modernization to government. Nor has he shown a commitment to transparency – data transparency or any other kind.

Yet the federal government’s open data transformation can, and should, continue. Here is how.

Transforming Federal Spending into Open Data

President Obama signed the nation’s first open data law, the Digital Accountability and Transparency Act (DATA Act), in 2014. The DATA Act focuses on what the government does with taxpayers’ money. It requires the Treasury Department and the White House to adopt a standardized data structure for all executive-branch spending information – accounting reports, budget categories, contracts, grants. It compels agencies to begin reporting all this information using that standardized structure, starting this May, 2017. It directs Treasury and the White House to publish the resulting open data set for all to scrutinize.

For those who seek a transparent and open government, spending information is paramount. If you can follow the money our government spends, you can understand its operations, assess its priorities, and discern its failings. That’s why passing the DATA Act was our first priority when I started the Coalition in 2012, and why our 2017 agenda promises we’ll work to enforce and expand it.

Thanks to the DATA Act, first introduced in Congress by Rep. Darrell Issa (R-CA) and Sen. Mark Warner (D-VA), open spending data isn’t just a discretionary project. It’s the law, like it or not.

Despite a commitment to open data in other areas, outside spending, the Obama Administration did not like the DATA Act. President Obama’s legislative affairs team tried to persuade Congress to weaken the DATA Act before passage; after Congress unanimously disagreed, the President signed it as quietly as possible; and the White House has been systematically undermining it ever since.

The law puts the Treasury Department and the White House Office of Management and Budget jointly in charge of designing the data structure that will transform federal spending information from a hodgepodge of documents and disconnected databases into a single, searchable open data set. First, the White House has insisted that this data structure need not go into detail, particularly for grant and procurement data. Rather than requiring agencies to report detailed data directly from their grant-writing and contract-writing software, the White House insisted that the data structure just rely on superficial summaries known to be unreliable.

Second, the White House has insisted that the government should continue to use the DUNS Number to identify contractors and grantees. The DUNS Number is proprietary, owned by Dun & Bradstreet, Inc., itself a private-sector contractor. Taxpayers who want to download contract and grant spending data must purchase a license from Dun & Bradstreet. Transparency groups and our Coalition have repeatedly called for Treasury and the White House to replace the DUNS Number with a different data field. But the White House has refused to make a change – and, in fact, even canceled a public speech by a General Services Administration technologist who intended to explain how the DUNS Number could be replaced.

Third, the White House flat-out refused to comply with the DATA Act’s requirement to test a new data format for contractors’ reports. Fourth, the White House decided it will enforce the DATA Act on only the largest federal agencies, ignoring dozens of smaller ones, and even broke a promise to Congress to provide a list of all the agencies legally required to comply.

The new Trump White House has an opportunity to reverse course on the DATA Act and insist on full data transparency for federal spending. And there are reasons to believe it will.

The President-Elect’s designee for director of the Office of Management and Budget, Rep. Mick Mulvaney (R-SC), is a declared supporter of open data. In the just-ended 114th Congress, Rep. Mulvaney became one of only a few members of Congress to cosponsor all three major proposals to transform bills, amendments, and laws from documents into open data: Reps. Seth Moulton (D-MA) and David Brat’s (R-VA) Statutes at Large Modernization Act, Rep. Justin Amash’s Searchable Legislation Act, and Rep. Elise Stefanik’s (R-NY) Establishing Digital Interactive Transparency Act. He also passed a law expanding the use of data analytics to fight improper payments.

Mulvaney will take command just before the DATA Act’s most important deadline hits. By May 9, 2017, under the law, every federal agency must begin reporting its spending information using the standardized data structure that the Treasury Department and the White House have designed. Treasury must publish this new data set on its USASpending.gov website. Following these first reports, the law gives Treasury and the White House one year to work with agencies to make sure that their reports match the data structure.

The Trump White House can reject its predecessor’s ambivalence: revise the data structure to include full detail on assistance and procurement; announce a process to dump the DUNS Number; re-start the ignored contractor reporting pilot program; and, most important, enforce compliance on all agencies, not just the largest ones.

On the campaign trail, President-Elect Trump promised to “drain the swamp” in Washington. If he truly intends to reduce the growth of the federal government, his administration must insist on tracking spending as open data. Without reliable data, management is impossible.

Meanwhile, Congress will enforce the DATA Act through oversight – and, perhaps soon, enact amendments to address OMB’s reluctance and strengthen the open data mandate. Chairman Mark Meadows (R-NC) of the House Oversight Committee’s government operations subcommittee has promised to keep the pressure on the executive branch through hearings. Rep. Meadows is the incoming chair of the House Freedom Caucus, the conservative group that sets the agenda for many Republicans in Congress. But Meadows’ support for DATA Act implementation is bipartisan, joined by Democratic leaders, including Rep. Gerry Connolly (D-VA).

By enforcing and expanding the DATA Act, the Trump Administration and Congress can double down on open data in spending. The Data Coalition is ready to provide the intelligence and support they’ll need.

Making Open Data the Default for All Government Information

Despite its ambivalence on the DATA Act, the Obama White House did support technological transformation with President Obama’s landmark May 2013 executive orderMaking Open and Machine-Readable the New Default for Government Information.

The executive order set up a policy that agencies should standardize their information – all of it – in machine-readable formats; install new IT systems with open data in mind; and create inventories of all their data resources to make it easier to transform everything into open data in the future.

The executive order didn’t directly force agencies to replace disconnected documents with standardized data, nor did it hasten the adoption of crucial open data linchpins like the Legal Entity Identifier.

But it did express, and encourage a culture change. Across the executive branch, program managers and policy advisors who wanted to recommend open data solutions could point to the President’s policy as proof their ideas were legitimate.

As a culture-change agent, Making Open and Machine-Readable the New Default succeeded brilliantly. From transportation to energy to health care to defense, open data projects took off. Last September, at our sister organization’s annual conference, Data Transparency 2016, over 1,000 people gathered to celebrate these projects.

President-Elect Trump intends to repeal many of President Obama’s executive orders. We don’t know if Making Open and Machine-Readable the New Default is on the chopping block.

But Congress is stepping in. Last month, right at the end of the 114th Congress, the Senate unanimously passed the OPEN Government Data Act, a new proposal to codify the main provisions of the executive order as law.

In fact, the OPEN Government Data Act goes further. It discourages proprietary data standards like the DUNS Number. It makes open data part of every government CIO’s job.

Because the House had already gone out of session when the Senate passed the OPEN Government Data Act, there wasn’t an opportunity to get the bill to President Obama’s desk. But the Senate’s unanimous passage, championed by Sen. Brian Schatz (D-HI) and Sen. Ben Sasse (R-NE), smooths the way for speedy action by both chambers early this coming year.

In December, our Coalition team had to respond to several last-minute questions and objections before every Senator agreed to support the OPEN Government Data Act. Sens. Sasse and Schatz both recognized our work when they celebrated the bill’s passage.

We’ll keep working until both houses of Congress pass it – with veto-proof majorities.

Modernizing Regulation to Reduce Burdens

By cliche, Democrats want to regulate more; Republicans want to regulate less. Democrats cite the need to protect consumers and the environment from profit-seeking companies; Republicans point to the job-killing burden of compliance with regulations.

Open data sidesteps that battle.

If regulatory agencies stopped using disconnected documents to collect all their forms and filings, and switched to standardized data fields and formats instead, companies could use software to automate many compliance tasks that today are manual.

U.S. agencies are making excruciatingly slow progress. Only a few have adopted the common Legal Entity Identifier (LEI), which allows companies to use the same identification code with multiple agencies and will support multi-agency searches and data analysis. Agencies like the Securities and Exchange Commission still use disconnected documents, not standardized data, to collect important information that makes no sense unless it is manually re-keyed into systems.

But countries like Australia show what is possible. In Australia’s Standard Business Reporting program, multiple regulatory agencies adopted a single open data structure for all their forms and filings, and eliminated redundant requirements, reducing data fields from 35,000 to 8,000. Standard Business Reporting saves Australian companies over $1 billion annually in compliance costs – even before it becomes mandatory at most agencies.

Open data doesn’t just reduce compliance costs. When regulatory reports are expressed as standardized data instead of disconnected documents, the information is easier to scrutinize with data analytics. By embracing open data, regulatory agencies can more effectively enforce laws and rules – without collecting more information than they did before.

Open data empowers investors and consumers for the same reason. As analytics become cheaper to deploy, entrepreneurs can develop new platforms that help investors and consumers derive insights and make informed choices.

President-Elect Trump’s transition team is full of people who have used data to make decisions, and even built businesses on digital disruption: Peter Thiel, Carl Icahn, Linda Springer. We believe the Trump Administration will be open to our advocacy for an open data revolution in regulation.

Congress is ready, too. Speaker Paul Ryan’s policy agenda calls for a “smart approach” to regulation, rather than simply less of it; 35 members of the House, from both parties, supported last Congress’ Financial Transparency Act, which would direct all financial regulatory agencies to embrace open data; and Senators of both parties have called for the SEC to modernize the way it collects financial information from public companies.

In the near term, our Coalition will seek the passage of the Financial Transparency Act and a new start for Standard Business Reporting in the United States.

In the longer term, we won’t just transform regulatory reports into open data; we’ll transform the regulations themselves.

George Mason University’s QuantGov project uses text searches to identify every mandate and restriction in the Code of Federal Regulation in order to inform studies of regulations’ economic impact. If agencies identified each mandate with an electronic tag at the source, and expressed regulations in machine-readable formats to begin with, the tech industry would develop new ways of analyzing regulations – and, eventually, automatically complying.

Political battles over the substance of regulation, and regulatory reporting, will continue. But all sides can agree that by transforming the format from documents into open data, we can reduce burdens for companies, investors, and agencies alike.

Our Challenge

I have two sales jobs. I must persuade policymakers that they should support data standardization and data publication, for all the good reasons described above. And I must convince tech companies that they should support our campaign, by paying for membership and by participating in our meetings and conferences.

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Announcing the transition from Data Transparency Coalition to Data Coalition and Data Foundation, January, 2016.

We find that our members invest a lot more in staff time and talent – developing demos for our events, bringing our message to Capitol Hill, creating real and virtual collateral that connects open data to their businesses – than they do in the treasure it takes to be a Coalition member. We need, and we appreciate, both.

Our members are poised for the creation of an entirely new industry – an industry based on the republication, analysis, and automation of open data. Open data is becoming a resource – almost like conventional natural resources – that our members can use to create value and build businesses.

In 2016, we started a sister organization, the Data Foundation, to produce detailed research on the challenges of open data. The Foundation published papers on the DATA Act and the state of the open data movement. Many more are in the hopper.

My sales jobs aren’t changing a bit. My sales targets are.

We call on the new Trump Administration and the 115th Congress to enforce (and expand) the DATA Act, embrace a government-wide transformation of all information resources through the OPEN Government Data Act, and initiate regulatory reforms that use open data to reduce burdens, governed by the Financial Transparency Act and other reforms. I am optimistic that we will realize all three goals.

We will give credit and blame where they are due.