"We did not make nearly the headway we should have made in affecting individual programmatic reform," Daniels said in an interview Thursday with National Journal Group publications. "Our batting average was not very good."
On the massive government reorganization required to create the Homeland Security Department, Daniels said it was the best way to coordinate antiterrorism policy across the government and less costly than letting 22 agencies tackle the problem independently.
But he added that managing homeland security policy will be "one of the biggest issues" the administration will face in the future as it determines "what risks are we going to defend America against" given the vast "continuum of threats" the country faces.
Daniels gave himself an "incomplete" on his aggressive efforts to curb the rising tide of congressional budget earmarks.
"It's one of those issues that lives on," he conceded.
Daniels said he thought OMB "made very legitimate [points], but in the end this is Congress' to decide." He did regret "letting the [issue] become too contentious, or letting it assume too much importance in people's eyes" compared to the many other problem areas OMB must tackle.
Nevertheless, Daniels said his successor, Josh Bolten, who has been deputy White House chief of staff for policy, will face "the same inherent tension" between OMB and congressional appropriators.
As for the continued growth in government spending during his tenure, Daniels emphasized the increase has been "heavily concentrated" in the areas of defense and homeland security necessitated by the Sept. 11, 2001, terrorist attacks, the war in Iraq and the ongoing war on terrorism.
In the rest of government, he continued, "There's been a real deceleration in spending."