Liberalism: The Ship that Does Not Sail

The Mugwumps and Progressives emphasized management issues and execution of programs. Herbert Croly, for instance, discussed scientific management and work restructuring in his 1912 Progressive Democracy. In the late nineteenth century EL Godkin discussed the role of incentives in managing railroads. The Muckrakers discussed management problems and Ida Tarbell, as much as she contemned John D. Rockefeller, favorably discussed his management abilities. In contrast, the post World War II liberals rarely discuss management or execution of programs. Their emphasis is on program advocacy not implementation. The reason may be that in implementing the New Deal, which in part relied on partnership between state and federal government, FDR overlaid federal programs like unemployment insurance on state governments that were often corrupt. The New Deal did not attempt to reform government as Progressivism had (and often failed to do) but rather added broad federal policies to an already corrupt system. This policy of see no evil, hear no evil, speak no evil seems to have been transmitted to subsequent generations of social democrats. Yet, the problem of execution and management is not independent of programs themselves. A social security program that is not well-designed is no better and may be worse than none at all. A welfare system that motivates beneficiaries to become dependent and that motivates despondency and drug addiction may be worse than no welfare program at all. An urban renewal program that creates ugly and alienating city projects that stimulate crime and roads that destroy neighborhoods may be worse than no urban renewal program at all. Government programs that generate high costs and few benefits, that drive out business because of high taxes and yet fail to accomplish their goals are worse than no programs. Management and execution are as much a component of programming as policy ideas. Yet, how often do proponents of new programs discuss management and execution issues? Very infrequently.

According to the French industrial Fayol, management is comprised of five tasks: planning, leading, organizing, coordinating, and controlling. This model was updated in the mid twentieth century by Edward I. Deming who argued that management is the reduction in variability of an output. The Deming interpretation of management is related to that of Taiichi Ohno, Toyota's production guru who created the ideas of lean manufacturing. Ohno argued that management is the elimination of waste. In any management system there needs to be a picture of what is going to be accomplished, a process that is required to achieve that goal, and a means of controlling the process so that it remains focused. The selection of the appropriate technique is not easy and it is not incidental. It cannot be accomplished by just anyone. A political appointee appointed along party or personal loyalty lines is not likely to be able to accomplish the managerial task as well as someone who has spent a lifetime thinking about production problems. An employee who has spent a lifetime focused on a certain process or kind of problem is likely to be best equipped to implement a quality program IF the employee understands the management techniques necessary to do a good job. Without taking such considerations into account, government programs are likely to be wasteful. Without controls, there is little likelihood that they will accomplish the objectives their advocates set out for them. If liberals build a ship that cannot sail, they cannot be said to have accomplished much. When the ship sinks, have they done more good than harm? Yet, social democrats advocate programs without thinking about process or about evaluation methods.

There are a number of natural blockages to the management of government programs. First, the cost of losses is not born by any concentrated interest. Because the costs are diffused, there is limited motivation by managers to reveal losses. Managers who reveal losses risk losing their jobs, but the public is not likely to feel the costs of the losses because they are spread over the entire tax paying population. Second, there are incentives for suppliers to cheat, to exaggerate the need for their products or to overcharge. Third, the customer base is captive. Because government enjoys a monopoly, those who use its services have nowhere else to go. Fourth, there is ideological resistance to criticism of government failure and waste by social democrats. Therefore, critics are likely to be humiliated. Fifth, even if public managers do radically improve programs, they are not necessarily rewarded for doing so. Sixth, waste may create patronage opportunities for politicians who in turn are likely to harass or fire government employees who resist it. Seventh, experts and specialists in government may be self-seeking and so not be motivated to improve programs.

Politics in America became largely a debate between two groups that advocate expansion of government: the Progressives, who are Republican in party and who advocate efficiency and effectiveness in government, and the social democrats (who also call themselves liberals and progressives) who do not. But it is not clear that Americans favor expansion of the state, whether it be the social democratic welfare state or the managerial state of progressivism. Moreover, the ideas that progressivism offers with respect to rationalization of the state do not, and likely cannot, reflect the state of the art with respect to management. Hence, Americans are given the choice between the second-rate services that the Progressives have on offer and the incompetence and chaos that the social democrats and their friends in the media gleefully advocate.

Factionalism and the Two-Party System

Americans may stick to the two-party system as an artifact of the founding fathers' fear of faction. By limiting the number of parties to two Americans limit the number of explicit political divisions.

In Elkins and McKitrick's Age of Federalism* the authors emphasize the universal fear and dislike of faction among the public and the founding fathers in the 1790s and earlier. This came in part from the belief that competition among factions had divided and harmed democracies in antiquity. Madison and Hamilton wrote about this in the Federalist, but the discomfort with factions or private associations of any kind (other than religious ones) was widespread. One exception was the Sons of Liberty during the revolutionary period and another, which Elkins and McKitrick don't mention in their masterful work, was the Freemasons. Also, there were incipient labor unions in the 1790s. Labor courses don't typically discuss the dislike of labor unions evidenced in the famous Philadelphia Cordwainers case as associated with a broader distrust of associations of any kind, but that may have been the case. In the Cordwainers (shoemakers) case a Philadelphia court held the union to be a criminal conspiracy. The criminal conspiracy doctrine was changed in the 1830s under the means-end doctrine enunciated in the Commonwealth of Massachusetts v. Hunt. The point is, though, that the shift in attitudes toward unions coincided with a shift in attitudes toward associations more generally. Usually the shift is described as responding to greater power of workingmen in the 1830s associated with Jacksonian presidency.

But the point is that in general private associations of any kind were viewed with suspicion, and minor political parties may be sensed in this way.

During the 1790s, Elkins and McKitrick point out, there was the rise of an early association called the Democratic Societies. The purpose of these clubs was mild, basically to discuss political issues and oppose corruption in government. President Washington viewed these clubs with suspicion, calling them "self-created societies" as did many leading politicians. Two Democratic Societies in Washington Town and Mingo Creek, Pennsylvania were involved in the Whiskey Insurrection in western Pennsylvania in 1791-4 in which tax collectors were tarred and feathered; Inspector of the Excise John Neville's house was burned after an open battle; and as many as 6,000 armed Pennsylvania militia massed on August 1, 1794. President Washington handled the situation masterfully and ultimately sent militia to quell the revolt, but there was no violence beyond scattered incidents.

Elkins and McKitrick point out that Washington blamed the Democratic Societies for the insurrection (p. 484):

"If Washington ever had a fixed obsession, it was these societies, "self-created in the sense of having no sanction in popular authority, societies which had been up to nothing but mischief since the first ones were formed...He had felt very early that if they were not counteracted they would 'shake the government to its foundations'; and 'now if this uprising were not subdued, we could bid adieu to all government in this Country except Mob and Club Govt.'"

Washington wrote that (quoted on p.494, Elkins and McKitrick)

"all combinations and associations under whatever plausible character, with the real design to direct, control, counteract or awe the regular deliberation and action of the constituted authorities are destructive of this fundamental principle (of the duty of every individual to obey the established government)...They serve to organize faction; to give it an artificial and extraordinary force; to put in the place of the delegated will of the nation the will of a party, often a small but artful enterprising minority of the community, and, according to the alternate triumphs of different parties, to make the public administration the mirror of ill-concerted and incongruous projects of faction rather than the organ of consistent and wholesome plans, digested by common counsels and modified by mutual interests."

Elkins and McKitrick quote a Senate resolution recorded in the Annals of Congress:

"Our anxiety arising from the licentious and open resistance to the laws in the Western counties of Pennsylvania has been increased by the proceedings of certain self-created societies...proceedings in our apprehension founded in political error, calculated if not intended to disorganize our Government, and which...have been influential in misleading our fellow citizens in the scene of insurrection."

Might this early distrust of associations, which had disappeared by the time De Tocqueville published Democracy in America in 1835, be the source of the American commitment to the two-party system? While the conflict between the Republicans and the Federalists in the 1790s amounted to a battle between centralizers and decentralizers; proponents of government subsidy to business and proponents of Whiggish suspicion of centralized authority, and so was unavoidable, might the fear of more factionalization than the Federalist-Republican or later Democratic-Republican division be the distant remnant of this early American fear of faction?





*Stanley Elkins and Eric McKitrick, The Age of Federalism: The Early American Republic, 1788-1800. New York: Oxford University Press, 1993.

The Federalist Number 24 and the Scope of Government

In the Federalist Number 24 Hamilton makes the following statement about the powers that the Constitution confers upon the federal government:

"The powers are not too extensive for the OBJECTS of federal administration, or, in other words, for the management of our NATIONAL INTERESTS; nor can any satisfactory argument be framed to show that they are chargeable with such an excess."

Are the powers that we have granted the federal administration today impractical for the management of national interests? I refer to the myriad of large-scale administrative tasks that the President and Congress are asked to review: Social Security, the Federal Reserve monetary system, Housing and Urban Development and the Department of Education. These are broad, comprehensive programs of such scope and extent that no group of people, much less a single person, could competently oversee all of them.

Compare the problems of the federal government to the problems of General Motors. The president of General Motors is beset with complex details and administrative challenges concerning a handful of products: automobiles, parts, financing and some additional products. Yet, the management of this handful of products has proven too difficult for the management of General Motors to handle all that well, and the firm seems to be drifting to bankruptcy.

Are the politicians who serve in Congress or the President that much more capable than the executives of General Motors? Are the people whom the president appoints to his cabinet and to senior posts in the federal agencies that much more competent than the management of General Motors? In the case of Hurricane Katrina, it seemed that the government agencies are not competent at all. Yet, the public has burdened the federal government with such extensive powers that the management problems, ranging from control to budgeting to personnel selection are orders of magnitude more complex than the problems that confront the executives of an automobile company.

When Hamilton, Madison and Jay wrote the newspaper articles that form the Federalist Papers, the United States of America had a population of three million. Today, the average state has a population of six million. Yet, the powers of government have been federalized to a much greater extent than Hamilton anticipated. This enormous concentration of managerial demands resulted from the perceived threat that industrial concentration posed to the economy. Yet, the concentration resulted in enhancing such concentration. The New Deal intensified the extent of concentration by establishing federal programs that replaced state discretion in fields like social security. The concentration was also enhanced by the civil rights struggles of the 1950s and 1960s, which required a degree of federal intervention to end Jim Crow laws and discrimination.

Today's problems are managerial as much as strategic or political: how to make social security work; how to best combine incentives for innovation with an equitable tax system; whether to extend or contract the scope of government; how to manage the nation's money supply to limit economic crisis and corruption. All of these are managerial problems that lend themselves to a range of strategic choices. The political arguments about them become more emotional and cantankerous as the various protagonists, Democratic and Republican, know less about each question. The expertise that fields like economics, sociology and business offer do not offer one or another optimal solution to any of these problems. In industry, trial and error has proven to work better than grand theory. Yet, subjects of considerable subtlety from the Iraqi War to the management of Social Security are pronounced upon with dogmatic rigidity in the pages of the daily newspapers and in the blogs.

Why can't a pragmatic delegation of complex managerial decision making to states, which are on average twice as large in population as the entire nation was in Hamilton's day, permit a multiplicity of solutions? Such a multiplicity would serve (a) to afford experimentation and learning about solutions; (b) to test alternative ideological approaches; (c) to resolve bitter conflict among Red and Blue proponents (d) to reduce and contain the risk of failure; and (e) to enhance democracy.

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