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This is not a blog which opines on current events. It rather uses incidents, books (old and new), links and papers to muse about our social endeavours.
So old posts are as good as new! And lots of useful links!

The Bucegi mountains - the range I see from the front balcony of my mountain house - are almost 120 kms from Bucharest and cannot normally be seen from the capital but some extraordinary weather conditions allowed this pic to be taken from the top of the Intercontinental Hotel in late Feb 2020

Tuesday, February 7, 2023

How did the managerial genie escape the bottle?

Although I’ve devoted 3 posts to Tom Nairn, I have to confess that it was John Stewart who played a far greater role în my life, work and thoughts. On the lines of Kurt Vonnegut’s Fahrenheit 451 it would be fascinating to visualise our minds scanned for the images of the books and writers who had meant most to us at different stages of our lives. În the 1970s and 1980s, Stewart loomed large – aș you can see from the paragraph praising corporate planning in my 1975 article What Sort of Overgovernment?

Corporate management should be about the translation of what is essentually a socialist principle into management and planning processes – in its technocratic form, however, it freezes a sociological insiight into an elitist technique. It breaks down some barriers (within the local authority) only to erect others (between the community and the local authority)”

Virtually all the references in that piece are to communities and municipalities, not to nationalism or Nairn with a reference to ”untapped areas of power with the municipality...if only the services could work with – rather than against – each other" perhaps revealing a sign of my naivety. By 1999 when I tried to summarise the lessons of public admin reform for central europeans and central Asians emerging from decades of communism, I had clearly changed my tune and emphasised instead the powerful political realities which make such attempts at corporate management almost impossible. What follows is an excerpt from In Transit – notes on good governance (1999) – after which a further post will try to deal with the issue which has been exercising me a lot these past few years – namely how on earth we have succumbed so badly to the "management revolution”.

Why reform was so difficult in the 1970s

  • the electoral cycle encouraged short-term thinking

  • there did not seem to be a definable "product" or measure of performance for government against which progress (or lack of it) could be tested.

  • and even if there were, politicians need to build and maintain coalitions of support : and not give hostages to fortune. They therefore prefer to keep their options open and use the language of rhetoric rather than precision!

  • The machinery of government consists of a powerful set of "baronies" (Ministries/Departments), each with their own interests

  • the permanent experts have advantages of status, security, professional networks and time which effectively give them more power than politicians who would often simply "present" what they were given. This has changed considerably since I wrote this!

  • a Government is a collection of individually ambitious politicians whose career path rewards skills of survival rather than those of achieving specific changes

  • the democratic rhetoric of accountability makes it difficult for the politician to resist interference in administrative detail, even when they have nominally decentralised and delegated.

  • politicians can (and do) blame others : hardly the best climate for strategy work

These forces were so powerful that, during the 1970s, writers on policy analysis seemed near to giving up on the possibility of government systems ever being able to effect coherent change - in the absence of national emergencies. This was reflected in such terms as state overload” and "disjointed incrementalism": and in the growth of a new literature on the problems of "Implementation" which recognised the power of the "street-level" bureaucrats - both negatively, to block change, and positively to help inform and smooth change by being more involved in the policy-making.

Neo-liberals and public choice theorists offered a convincing theory. In the meantime, however, the 1970s gave the opportunity for neo-liberalism in the UK. Ideas of market failure - which had provided the post-war justification for the welfare state - were replaced by ideas about government failure. The Economist journal expressed the difference in its own inimitable way –

"The instinct of social democrats has been invariably to send for Government. You defined a problem. You called in the social scientists to propose a programme to solve it. You called on the Government to finance the programme: and the desired outcome would result. What the neo-liberals began to say was the exact opposite of this. There probably wasn't a problem: if there was, social scientists probably misunderstood it: it was probably insoluble: and, in any case, government efforts to solve it would probably make it worse"

The very concept of rational government acting dispassionately in the public interest was attacked by neo-liberals on three grounds –

  • "Vote-maximising politicians, as the public choice theorists demonstrated (Buchanan and Tullock 1962), will produce policies that do not necessarily serve the public interest, while utility-maximising bureaucrats (Niskanen 1971) have their own private agenda for the production of public policies. The growth of the welfare state had brought with it an army of professional groups, who supplied the services. These were teachers, doctors, dentists, planners etc in bureaucratic organisations sheltered from the winds and gales of competitive forces. Provided free of charge at the point of consumption, there will always be an excess demand ; at the same time it is in the interest of monopolised professional providers to over-supply welfare services. Public expenditure on welfare services, in the absence of market testing, exceeds its optimum".

  • "The problems don't end there. Professional groups decide upon the level, mix and quality of services according to their definition and assessment of need, without reference to users' perceptions or assessments of what is required. The result is that not only is public expenditure on welfare services too high; it is also of the wrong type".

  • And finally the issue of efficiency; in the absence of the profit motive and the disciplinary powers of competitive markets, slack and wasteful practices can arise and usually do. Within bureaucracies, incentives seldom exist to ensure that budgets are spent efficiently and effectively. Often there is no clear sense of purpose or direction."

Fundamental concepts of public administration - eg hierarchy, equity and uniformity - were unceremoniously dumped.

To be Continued

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