Bureaucracy and None of the Above

The Progressive movement and its social democratic system put considerable faith in bureaucracy. In part, this was because the late nineteenth and early twentieth centuries saw bureaucracy as improvement over the paternalism of the early nineteenth century, and they were right. However, by 1940 right as the New Deal reforms of 1932-7 were drawing to a close, it had become evident that bureaucracy does not work so well as its proponents thought. In the 1940s the sociologist Robert Merton wrote an article about the rigidity of bureaucracy and bureaucrats' fetishization of rules at the expense of efficiency. In the 1950s Taiicho Ohno of Toyota pioneered the principles of lean production and total quality management. Even going back so far as the 1920s, Alfred Sloan of General Motors, along with executives in other leading firms, pioneered the use of decentralization, federalized organization, realizing that large firms did not permit global or functional forms of organization. The information and flexibility requirements of large firms are too daunting for anyone to handle.

Strangely, though, the Progressive and social democratic movement continued to emphasize centralization. The result is that increasingly, American life has been dominated by unresponsive, unproductive government bureaucracies that spin regulation and do not care what the public thinks. This is the result not only of centralization but also of the increasing emphasis on expertise in the expansion of government at the expense of the spoils system.

The result is a considerable degree of dissonance between the public's experience and the "facts" it is fed in school, through the news media and through public opinion leaders who are committed to the Progressive, social democratic solution because it enforces their status as professional experts, elite business leaders and the like.

The public has become increasingly alienated from public institutions because they are distant; they do not work; and they are held forth as far superior to the processes and systems that in the public's own experience work. As a result, the public experiences what psychologists call "cognitive dissonance". On the one hand, they are taught that "experts" know better than they do. But when they interact with state government, the department of motor vehicles and the like, they experience systems that do not work so well as ones that they themselves could devise. They are taught that scientists can solve problems. But then they hear that cancer has become an industry characterized by avoidance of effective remedies, politics, waste and regulation of innovative ideas out of existence. They are told that the state equalizes inequity, then they learn that the federal government subsidization billionaire investment bankers through direct bounties and a central banking system that sees its primary role as to support stock prices.

Cognitive dissonance has unpredictable effects, but one of them is potentially withdrawal. Others include anger, attempting to intervene and correct the situation, and denial. All of these are present in today's society.

Both left and right have become increasingly strident as the remedies that they advocate, central banking, expertise in government, efficiency, a corporatist state that supports the public interest, have failed to materialize. Political correctness, left wing intolerance of dissent in universities and other institutions, reflects the left's inability to confront the failure of the mercantilist solution to which it has been wedded since the late eighteenth century. Likewise, the right wing increasingly fights within itself, unable to arrive at a coherent picture of reform. As well, much of the right is in denial about its own Progressive spirit. The split between libertarians and conservatives has permitted mercantilists of the Progressive (Republican) and social democratic (Democratic) stripe to dominate the electoral process.

The public faces declining real wages, yet has refused to confront the decline and has borrowed, consuming about six percent more each year than it creates. There is avoidance of the causes of economic decline. Firms have heavily relied on public subsidy, especially through the banking system, yet corporate executives claim prerogatives of private property in extracting ever-increasing salaries that at most weakly reflect corporate performance. Few in the news media suggest that corporations that do not see a public role ought not to be subsidized by the public, and that the Federal Reserve system is little more than a crutch for inefficient American firms.

Americans increasingly feel alienated. The reason is that the obsession with size and economies of scale has been pursued too far. The large scale of industry; the large federal government have not yielded increases in wealth. Rather, they have become vehicles by which corrupt special interests extract wealth at public expense and as the public has reacted to cognitive dissonance by increasingly withdrawing or by becoming ever more strident in its demand for "change", a noun that describes an unnamed verb.

The remedy for too much centralization is decentralization.