Image: Matt Collins
The crisis of American governance goes much deeper than political divisions and ideology. The U.S. is in a crisis of policy implementation. Not only are Americans deeply divided on what to do about health care, budget deficits, financial markets, climate change and more, but government is also failing to execute settled policies effectively. Management systems linking government, business and civil society need urgent repair.
The recent systems failures are legion and notorious. The 9/11 attacks might well have been prevented if the FBI and the intelligence agencies had cooperated more effectively in early 2001 when they were receiving various signals of a possible terrorist attack. Hurricane Katrina caused mass devastation and loss of life because recommendations to bolster the levees shielding New Orleans and other protective measures were neglected for decades despite urgent expert warnings, and because the federal emergency relief effort failed completely after the storm. To this day, reconstruction efforts in New Orleans are paralyzed and many poor communities there have been abandoned. The U.S. occupation of Iraq was marked by massive and shocking corruption, incompetence, and implementation failures by U.S. agencies.
On the economic front, the current financial crisis is a remarkable systems failure. Government regulatory agencies completely dropped the ball while overseeing the surge of several dangerous financial instruments, especially sub-prime mortgages, collateralized debt obligations (CDOs), and credit default swaps (CDSs). The supply of CDSs in particular soared from nearly zero in 2000 to an estimated $60 trillion in 2008 with almost no regulatory attention. These unregulated CDSs underpinned the reckless lending that eventually burst in the Great Crash of 2008.
The list, alas, goes on and on. Military procurement systems are, according to retired military leaders, so broken that they now jeopardize national security: the U.S. is buying armaments that are overpriced, unneeded and technically defective armaments. Our system for financing the costly federal health care system subsidizes the overuse of advanced technologies while underfinancing highly effective and lower-cost public health measures. Public construction systems are failing to keep up with urgent national needs. Roads, bridges, rail, water and sewerage systems and many dams are in dangerous disrepair around the country; large sections of New Orleans remain wrecked and highly vulnerable; and even ground zero of 9/11 remains a hole in the ground because of endless bickering. Similarly, despite nearly a decade of planning, the government has failed to build and test even a single coal-fired power plant that captures and sequesters its carbon dioxide.* This so-called Future-Gen project, vital for the transition to a low-carbon economy, has still not been launched.
We need a better scientific understanding of these pervasive systems failures. It is wrong to think that they illustrate the inevitable failure of government. Other governments around the world more successfully manage infrastructure investments, health systems and environmental resources, apparently with greater flexibility, less corruption, lower costs and better outcomes. America should be learning from their experiences.
Several factors are at play. A key one has been the flawed privatization of public-sector regulatory functions. Wall Street firms hold excessive sway over government regulators, so that dangerous behavior has been unconstrained. Private insurance companies and health care providers block measures to curtail the overuse of costly technologies. Private military suppliers drive the procurement of unneeded weapons systems.
A second has been the collapse of planning functions within the federal government. A remarkable feature of the recent debates over climate change, energy systems, infrastructure rehabilitation and health care reform is the lack of detailed forward-looking government proposals and plans. The Obama administration has stated general principles (very admirable ones) but too often without clear targets and the operational strategies to achieve them. Planning has been replaced by lobbying and backroom deals in Congress that are nearly opaque to the public.
A third, and paradoxical, factor is the chronic underfunding of government itself. It sounds like the old joke about the bad restaurant: that the food was lousy and there wasn’t enough of it. The public is wary of putting more funds into government having witnessed one public sector failure after another. Yet without investing more resources in skilled public managers in health care, energy systems, and national security, we are probably doomed to remain stuck in the hands of vested interests and lobbies.
Fourth, today’s challenges cut across technical specialties, government departments and public and private sectors. In health care and energy, for example, the private sector holds the key technologies but the public sector is needed to finance research and development, to regulate sustainable practices (for example, for emissions reduction and primary health standards), and to ensure access for the poor. Public health must be addressed not only through curative medical care but also through nutrition, food systems and a safer built environment. Energy systems must respect ecological as well as economic constraints. Yet our government agencies are not designed to take a holistic approach.
In short, we have arrived at a point where the challenges of sustainable development —including public health, infrastructure, energy and national security—require changes not only to policy but also to basic public management systems. In many crucial areas, tinkering will no longer suffice: we need an overhaul to regain government control over regulatory processes, reduce lobbying, restore public planning and ensure the adequate financing of skilled public managers, and align public management systems with holistic strategies.
*Clarification (11/24/09): Jeffrey D. Sachs complains that the U.S. government has failed to build a single coal-fired plant that captures and sequesters its carbon dioxide. One such facility does exist at the Shady Point coal power plant in Oklahoma, but it is not a government project.
This article was originally published with the title The Crisis of Public Management.
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28 Comments
Add CommentIt is not the US government that is failing but democracy as a whole. People all over the world are realising that politics is a cat and mouse game and that the people are the victims. The cold war set back any form of democratic progress for decades and the current financial and ecological crisis shows that it is high time to deal out the cards again, not randomly, but fairly. The problems facing mankind now ive him the opportunity to adopt a new and totally original mind-set.
Reply | Report Abuse | Link to thisElegant critique of the growing dysfunction within America. I doubt if we are or ever could be able to monitor and report the range and scope of influence on American public policy (including state and local) by all registered lobbies. Probably, lobbying is the most difficult institution to reform and attempt to control. Do any other countries have good lobby controls with transparency requirements? All other systems problems seem subservient and influenced by lobbies. I would also assume that every department and agency in the US government is influenced by at least several lobbies. Many probably believe that the most hopeful office in the Fed Gov't is the GAO. If their budget were even 1% of the DoD at least we would have superb analysis.
Reply | Report Abuse | Link to thisThis is an excellent critique. However, several important points are missing. Our government is 'influenced' by Big Oil, Big Pharma, Big Agra, etc. Legislators are paid to look the other way. Look at legislation governing our broken food system, it is written by piece meal, and agencies are defunded so they cannot regulate effectively, on purpose! The granting of personhood to corporations has to be overturned. Campaign finance law needs to allow for 'clean elections' -public financing of campaigns level the playing field for people who really want to serve the public good. Until we get rid of the corporate 'ownership' of our legislators, nothing is going to change. Thank you for an excellent article.
Reply | Report Abuse | Link to thisUnfortunately, the situation is even worse than your article would imply. Our Cinderella fable of the fountain of wealth is accompanied by the two ugly sisters, Spin and Dishonesty, protected by the Evil Godmother Government from all accountability for their lies and deceptions.
Reply | Report Abuse | Link to thisWe cannot get at the truth of the matter to find out how deep the problems really are, until the wheels come off our pumpkin carriage at midnight and we find out how horribly we have been duped by the Good Fairies who were and are running this country.
While corporations are held to very high reporting standards (mainly because the Government wants a lot of detail on taxable income), there are virtually no legally mandated reporting standards for American government at Federal, State, County or City level.
Reply | Report Abuse | Link to thisAs a result, at every level of Government, information flow is a one-way-street. There is no reverse flow back to the people.
In this scenario, voters do not make balanced judgments on their choice of representative, simply because they have no information on which to base their decisions regarding the quality of Government management.
Thomas Jefferson once observed that a people get the Government they deserve.
American apathy is ensuring that this adage remains true.
There is one factor that is the root cause of the "mismanagement; GREED. Every individual and every institution is working to get every dollar they can, by any means possible, legal, illegal, moral, immoral, ethical or unethical. Uless and until we are able to get away from the greed factor this will only get worse.
Reply | Report Abuse | Link to thisIt has finally dawned on me why the Perestroika in Russia in early 90's had failed. In order to help the “Russkies”, America had sent to Mr. Yeltsin our finest Harvard-bread Socialists – the Dr. Jeffrey D. Sachs Ph.D. & Co. Mr. Sachs and his crew were trying to rebuild a new facade on the same old half-demolished and discredited Socialist foundation.
Reply | Report Abuse | Link to thisSomeone had said that “insanity is doing the same thing over and over again and expecting a different result.”
Therefore, it does not matter that Socialism, and its variant – Fascism, had failed in the Soviet Union, in Nazi Germany, in Mussolini's Italy, in Mao's China, in Latin America, in Asia, in Africa, with exactly the same results of unspeakable human suffering. If only different “actors” would be involved they would make all the difference. No way Jeff, if the foundation is flawed the building will still be crooked and unstable no matter who builds it.
Fast forward almost twenty years, to present day US. After indulging itself for more than half a century in its own Socialistic experiments, dated back to FDR and his “New Deal”, every US Government program, in Mr. Sachs own admission, had failed in every aspect across the board, – public safety, 9/11, “Drug War”, FEMA, FDA, Iraq, Afghanistan, Welfare, Corporate Welfare, Financial Services, Health Care, etc. Name just one program that had succeeded. Therefore, what we need, by the definition of insanity, more of the same “kool aid”. We need a different government program to fix all other failed government programs. With the new “actors” in the White House it will certainly work. It was the Bush's White House that failed, no it was Clinton's White House, no it was Bush Sr. White House that failed, etc., etc...
How about eliminating the government programs and reducing the US Government to its original Constitutional limits? What a novel idea. They don't teach that at Harvard.
What is the difference between Economic Policies of Clinton, Bush and Obama?
Clinton policies is when in a dark room you are looking for a black cat.
Bush's policies is when in a dark room you are looking for a black cat you know is not there.
Obama's policies is when in a dark room you are looking for a black cat you know is not there, nonetheless, every fifteen minutes you shout: – ” I got it...”.
The government lacks sense, not dollars. Governing for good-of-the-party rather than good-of-the-country undermines almost everything attempted at the federal level. The combination of short-sighted partisanship with a 24/7 printing press and lack of accountability allows our government to pursue any folly and ignore any inefficiency. It is stunning to postulate that our public sector lacks sufficient funds.
Reply | Report Abuse | Link to thisChronic underfunding of government? What planet does the author live on?
Reply | Report Abuse | Link to thisGovernment revenue growth has far exceeded inflation in the past decades. Unfortunately spending growth has far exceeded even that.
On what premise does this article lie?
Reply | Report Abuse | Link to this"overhaul to regain government control over regulatory processes, reduce lobbying, restore public planning and ensure the adequate financing of skilled public managers, and align public management systems with holistic strategies"
when have these strategies ever worked? They have all been attempted before and have left us were we stand today - with scientific american commentators pessimistic angry rants about how everything in the government is broken
Self organizing systems composed of free individuals are self correcting.
Reply | Report Abuse | Link to thisCentrally organized rules based systems are not self correcting because their control mechanisms outlive the problems they were intended to solve and in addition, continue to cause new problems.
Put another way, unlike a business, a government program does not cease when it ceases to be profitable.
There is also the bandwidth problem of running things from the center. An entire economy may be viewed as a computer whose job is to decide how to allocate scarce goods and services which have alternative uses.
Now the question becomes which is better: a massively parallel highly distributed system needing only limited node to node bandwidth, or an enormous central supercomputer requiring large center to node bandwidth and having limited or no internodal connectivity?
Good governance is about individual freedom; both because freedom is right, and because freedom is efficient.
Poor governance will always get its comeuppance, because economics like thermodynamics has laws that may be violated only locally, and only for a little while.
Oh my goodness.... What a load of trash.
Reply | Report Abuse | Link to thisLets look at peoples motivations. Assuming people are greedy, lets use that to our collective advantage...
What is the incentive to remove waste and corruption in government? If you remove waste you lose your job, your funding, etc... The incentive is not to notice or remove waste.
What is the incentive to remove waste and corruption in the private sector? If you remove waste you have more profit! There is a real incentive to remove waste. It will also free up the wasted resources (people, money, property, etc...) to be used on more value adding activities in society.
Let the free market allocate resources that is what it does best. Let the government set the rules (monopolies, collusion, price fixing, etc...) and monitor the market. BUT DONT let the government set the prices! We will me in a world of hurt if we do.
Things don't seem to "work" very well anymore.
Reply | Report Abuse | Link to thisI hope I misunderstand the author when he says this: "The public is wary of putting more funds into government having witnessed one public sector failure after another. Yet without investing more resources in skilled public managers in health care, energy systems, and national security, we are probably doomed to remain stuck in the hands of vested interests and lobbies."
Reply | Report Abuse | Link to thisIs he seriously suggesting that we shovel money at managers in the manner of Citi, GM, and Enron and hope that it will provide sufficient incentive to perform competently and honestly? What planet does this fellow live on?
Former Singapore PM Lee Kuan Yew hit the nail on the head when he responded to criticism of his authoritarian rule by admonishing critics that they should not assume that their liberal western-style democracies were the "last word in political evolution." The same could be said for economic models. It's strange, isn't it, that we expect everything in our cultural and technological sectors to continue to evolve and improve, but are stuck in the same old capitalist/socialist/communist and democratic/totalitarian/theocratic economic and political paradigms.
Surely the ongoing slow-motion failure of all these philosophies should spark an interest in developing more evolved alternatives.
I find it curious how critical analysis more and more seems to be making sweeping judgements at one moment in time, without much regard to what happened before. Of course, it is always easy to demonize or criticize after a calamity.
Reply | Report Abuse | Link to thisYes, the system in the US is broken, but would it have been so easy to say so in the late nineties when the government was in surplus (again, a cherry-picked moment in time)? Of course not. But things were good then and are not so good now, so it should be easy to identify who broke things. I for one, identify Bush and his cronies as the prime culprits. That being said, rather than spreading around ample blame, wouldn't it be more effective to try and reverse the decline by reversing the changes put in place by his government? But more people and lobby groups have a vested interest in preventing Obama from doing so. Others would rather throw the whole thing in the trash and start again.
Reply | Report Abuse | Link to thisIt should be how gov fails under republicans. When dems have the presidency, they balanced the budget and they reduced the size by 5% vs $10T in damage, increased gov 20%, 30% under Regean/Bush, by the repubs in just 8 yrs.
I'll bet with competent people under Obama, gov will work very well.
For better gov make all primaries open with instant runoff. This would make for moderates instead of the extremes of both sides we get now
Republicans like to say that less government is the answer. Guess what?? There already exists a party that has less government as its basic platform!!! The problem is that the Libertarian party is not the party of God, so the republicans can never embrace it. The will just continue to complain that government takes too much of their money, because they are greedy. We have the lowet tax rates in the civilized world.
Reply | Report Abuse | Link to thisI think a good start would be to tax every dollar earned in the U.S. at the same rate. Those making millions are taxed at a rate considerably less than those making thousands, despite what Rush says. The limits, deductions and additional taxes on everything else make the burger flipper the the highest taxed American.
Another good start would be to get rid of the idea that it is the American way to live above your means. There are incredible redundancies in the finance and insurance areas that make everything more expensive for everybody. The only way to rein in the lenders and insurers is to put them out of business by saving your money for the things you purchase.
I saved my money, never lived above my means, established a health account and paid cash for my home when I retired. Americans have been brainwashed by greed at every level.
To Mike B: For mammals to have evolved it took a cataclysmic event to wipe out the dinosaurs. Maybe we need a plague on the Republicans so that our political structure can evolve. They always seem to be stuck on the same issues.
Reply | Report Abuse | Link to thisSeriously, I don't think we are on the brink of a complete global political collapse, but we are headed in that direction. A good indicator will be how we handle the transition from fossil fuels over the next half century. The world political scene will change greatly during this transition. If my 11 year old has children, they will be in for a roller coaster of a ride (solar powered, of course!!).
Frankly, the fact that the American people so easily mistake such pablum for an "... excellent critique ..." terrifies me. I fear for the future because we cannot discern the difference between worthless political rhetoric and substantive debate, thus politicians are judged (& rewarded) based upon the one, rather than the other.
Reply | Report Abuse | Link to thisIt's not the $$$, it's what we DO that matters - have your elected officials helped you understand how the processes in question works? ... to understand the core problem(s)? ... to understand where our 20% is (Pareto principle)? Hint: You don't learn these things from sound bites and emotional speeches.
If SciAm truly wishes to make a worthwhile contribution, then the editors can start by educating their readers about the rhetorical tools that politicians use to manipulate their constituents.
At the same time, SciAm can take on the task of performing a truly INDEPTH analysis of the problems of the day by answering the questions mentioned above. For starters, SciAm can take on the subjects of healthcare, health insurance and pharmaceuticals and answer the most fundamental of questions - what drives the cost? Why do we do things this way? What costs are truly avoidable?
Barring that, silence is preferable.
The best two words of Mr. Sachs' article are at the end: "holistic strategies." Such strategies are addressed most completely by a systemic approach--one familiar to practitioners of systems science, or, the 'science of complexity.' One favorite managerial truism is, "A problem well-defined is a problem halfway solved." The problems Mr. Sachs refers to, however, are too complex to be defined well without losing the attention of the vast majority of the problems' stakeholders.
Reply | Report Abuse | Link to thisAre your eyes glazing over already? See what I mean? It gets much worse before it gets better. The processes needed to have complex (socio-technical) problems defined well--let alone to devise good solutions and implement them--require the participation of stakeholder representatives, and these efforts take a long time. With our attention spans being famously short, the prospects are dim in the near term.
If, however, our next generation of children were taught thoroughly about the things that all complex systems (biological, social, even technological) have in common, as adults they wouldn't need graduate degrees in business or public administration to be effective managers in the private or the public sectors. As it is for those who are exceptional managers despite not having the appropriate graduate training, their instincts would kick into gear and stay that way. Imagine an entire generation with such skills! For this reason, systemic thinking should be considered a 'core competency' just like math and verbal skills.
For this to happen, however, the entrenched academic establishment would have to consider teaching a subject they are unfamiliar with. Either that, or they think it's the same thing as a familiar buzzword, "interdisciplinary," as in, 'Oh, I've already been to that seminar.'
If you're still paying attention, and you are in a good position to keep this ball rolling, your country needs you!
jerryd,
Reply | Report Abuse | Link to thisI'll agree with you that the repubs screwed up when they had the wheel in that they allowed spending to continue to spiral out of control.
However, your man Obama is on track to double the national debt in his term. He will tack on an amount equal to the entire debt amassed from George Washington through W. Right now, 40% of your tax dollar goes for interest. Within a year or two that will be 50%. The course Mr. O has embarked upon is unsustainable, pure and simple.
Congratulations to this insightful author who realizes how inefficient, costly, and inhumane "privatization" is. When I lived in Ridgewood, NJ, in the 80s we were grateful for our good public services. For example, our trash pickup was paid for by precious local taxes and run by the town--while nearly every other municipality and village in Northern New Jersey was privatized. Ridgewood's trash collection was superb, the cost fairly distributed and relatively cheap. The others were a mess, outrageously expensive, especially in towns where garbage pickup was operated by the Mafia. Unfortunately criminality o the Mafia example has become the goal of "private enterprise" in the U.S.!.
Reply | Report Abuse | Link to thisIf it were truly efficient to turn public services over to bottom-line lowest-bid private companies we'd still have private fire departments of the sort run by Crassus, Caesar's triumvir colleague. The "C.F.B."--Crassus Fire Brigade" (NOT "department", which would be governmental)--raced to a fire. Sometimes they arrived earlier than it began in order to set it! Once there they extorted money from the owner (if they could find him) before lifting a finger to put it out. If the owner wasn't available, tough luck.
I agree with almost everything this writer has outlined. The greatest challenges to social efficiency are to cease & roll back privatization, deregulation, monopolies & cartels, removal of jobs overseas, and (as other commentators recognized) the institutionalization and social acceptance of greed. A corollary is the need to redefine the word "free" realistically, as in the current ridiculous definition of "free enterprise" by gthe NeoCon(federates). I think there are only two really deadly sins--(1) exploitation of any living creature or of any inanimate but vital world process, and (2) the deliberate failure to face reality, preferring to live in denial--in which our country is drowning.
Let's resiscitate some form of rational Keynesianism and greet the trickle downers and privatizers with the flatulence they deserve. It will mean choosing socialist solutions until a balance is reached--but the American eagle can no longer be allowed to flap around helpless, with its entire left wing shot off!
Greed is not necessarily bad. The hidden hand of self interest makes capitalism the only true engine of progress and positive change that the world has ever known. The workings of the hand are not, however, either pleasant or fair. Some people get slapped down, others patted on the head and raised up, and frequently the most free of the free enterprise societies swing violently from over-production crashing into depression and unemployment, through a lengthy period of misery, then the boom times return for a few lucky decades.
Reply | Report Abuse | Link to thisI've been a government worker of one sort or another for all except five years in the private sector, and now I am nearing retirement. In the private sector when a small business entrepreneur makes a big mistake, they most frequently lose absolutely everything--pension, savings, their home, everything. Very large corporations can make very large mistakes but sometimes government will bail them out so the fools that made the mistake lose nothing.
Government bureaucracies tend to make hundreds of small mistakes every day, but it doesn't matter because they can never really go broke as long as government can simply create money out of suitable paper or even a stream of electrons simply authorizing banks to lend money they don't have.
I don't think that any of the bureaucracies I have worked for can be "reformed" out of the structural inefficiencies and redundancies they have evolved. They will just stagger along until the government regime that props them up one day fails catastrophically itself, then everything will be rebuilt at once from a clean slate.
V.I. Lenin once said that revolutions never succeed from their own efforts, but must wait until the old regime becomes so conflicted and incompetent that it can neither function nor defend itself. Strangely enough, there has never been a nation nor a civilization that did not decay to that point, the last years being a kind of shuffling, wheezing stagger of the living dead before they fall on their face.
I am tired of reading articles that discuss only whats wrong with the USA. There are plenty of things that the USA is doing right.
Reply | Report Abuse | Link to thisI am tired of reading articles that discuss only what is wrong with the USA and never anything that the country is doing right.
Reply | Report Abuse | Link to thisJeffery ... Jeffery ... Jeffery! I am in complete agreement with themoralhazard. You have got to be kidding! What government program or planning has succeded to achieve anything in a timely or cost effective manner! You name all these programs that are failures, but you solution is to spend more money on the very people who are failing to achieve the specific goals of the intended programs!!? You must be suffering from insanity! By definition you must have fallen on your head from your tree. Thinking that doing the same failed action, only more robustly, will create a different result! And to say that the health care system, climate change, energy needs government oversight from higher paid medlers is beyond stupid. Find something else to write about, because you clearly don't have a clue what you are talking about. Spending $2 instead of $1 for $.05 worth of government is uncontrolled stupidity!
Reply | Report Abuse | Link to thisI couldn't agree more with Judy K. about repealing personhood for corporations and with those who hold that unbridled greed is destroying this country. Just a look at the healthcare system and at the current debate should be enough to convince anyone of the desperate state we are in.
Reply | Report Abuse | Link to thisRepeal personhood for corporations, then corporations can not defend themselves against absurd and opportunistic charges from socialist bands of thieves. Worry, Wes50, you can not steal from me that easily. My money is in corporations that earned every dime of their profits honestly in that consumers did have a choice and yes, they made that choice.
Reply | Report Abuse | Link to thisYou can second guess the consumer and say that, well, they should have chosen automobiles without 300 hp and tailfins, and they should have chosen cereal without sugar in it, etc. but you know what--it was still a free choice, as was the choice to smoke cigarettes, eat fast food, drink martinis, and watch TV instead of exercize.
The profits of corporate America were not immoral. Profit is rarely immoral and you are not justified in slandering great American corporations (in part owned by investors like me who always worked for government and bought into the stock market for my retirement) just because you want to steal their net worth. But that net wortlh belongs to shareholders like myself, so back off wes50, else we start looking at you as a thief who contributed nothing and now wants a slice of the pie. You don't get it.