Wednesday, October 21, 2009

A Good Bureaucracy/Anna Karenina

From deep in the heart of libertarian economics comes this question for Tyler Cowen, and his answer:

Jason asks:

What are some examples of successful government bureaucracies?

Wars aside, here is a short and very incomplete list: the NIH, the Manhattan Project, U.C. Berkeley, the University of Michigan, Fairfax County, the World Trade Organization, the urban planners of postwar Germany, some of the Victorian public works and public health commissions, most of what goes on in Singapore, anywhere that J.S. Bach worked.

The European Union has been very good for eastern Europe. I'll leave aside the health care issue because we've debated that plenty already. The real question is what all these examples have in common.

I don't think this is such a hard question, and I don't think the answers are specific to government bureaucracies. Here again is a place where Tolstoy's Anna Karenina principle applies. ("Every happy family is the same. Every unhappy family is unhappy in its own way.")

It's hard for any organization to be successful if it doesn't have a clear mission, if it doesn't have competent leadership and employees, if it lacks adequate resources, or if its organizational structure prevents its proper functioning. The first two are the biggies - many problems can be overcome if you have those crucial ingredients.

Success is transient though, because all those elements are temporary. Bill Clinton's FEMA was pretty good because he gave it good leaders. George Bush's FEMA was a catastrophe because he appointed inept political cronies and muddied its mission, and because those two things drove out the competent employees.

American public schools and universities were a great triumph and played a crucial role in our emergence as the dominant power in the world. The rest of the world has now caught up though, and in many cases surpassed our educational system. The educational system has been severely damaged both by tampering with its mission, by ill-conceived social experiments, and for public universities, by starvation of resources.