Friday, October 25, 2013

Combating Bureaucratic Corruption and Inefficiency: Lessons from the United States

 Note:  On October 26, I head off to Moscow, Russia for a week to lecture and teach.  This blog is one of the talks I will be giving at Peoples Friendship University next week. For those into the nitty gritty of government reform you will like this blog.

Combating government corruption and inefficiency is a problem that is faced across the world. During the communist era bureaucratic inefficiencies and corruption were widespread in the Soviet Union and across Eastern Europe.  Even today, many post-communist countries and emerging democracies face these problems.
    In their transition from communism, many countries employed several mechanisms to address corruption and inefficiency.  In some cases, state-owned enterprises were privatized.  In other situations, administrative law and civil service reform sought to control bureaucratic discretion and corruption. But the introduction of these reforms is not confined to post-communist states. Even the United States overt time has implemented administrative law or civil service reforms to achieve these and similar goals.
    What I would like to discuss today are two techniques, tools, or goals that the United States has adopted to address problems of what I shall bureaucratic discretion.  Bureaucratic discretion is the ability of government officials to make decisions or choices regarding the implementation of the law, adjudicating disputes, or making any other routine decisions.
    The two topics I wish to discuss are the use of administrative law to confine or limit bureaucratic discretion, and also a commitment to transparency in decision making.  Limiting discretion and promoting transparency are important pillars of American administrative law and decision making.

The Constitutional Ethic of Public Service
    Sociologist Max Weber once described government service as a professional calling.  In his description of bureaucracy he noted the such entities controlled bast amounts of power, with bureaucrats able to use their rational technical knowledge and skills to accomplish tasks.  While such power can be efficient and serve good purposes, it can also be corrupting and serve self-interested goals.
    Ensuring that government bureaucracies serve the good of the people is the goal of a democratic society.  In order to do that in the United States, what has developed is a constitutional ethic of public service.  This constitutional ethic has basically two components.  The first is the development of a set of internal or subjective beliefs in bureaucrats that they are supposed to serve the public good by limiting their discretion, avoid corruption, be accountable to their superiors and the public, and make decisions consistent with the rule of law.  In effect, an ethos or psychological commitment is fostered among those who work in government.
    But a second part to the constitutional ethic of public service is the creation of numerous laws, rules, or processes that promote democratic values.  In the United States, these rules include ones that promote political neutrality, respect for individual rights, and limit conflicts of interest.  But in addition, there are two other  types of laws that I wish to focus on today.  The first deals with limits on bureaucratic discretion, the second is the promotion of transparency and openness in making decisions.

Limiting Administrative Discretion
    In the United States efforts to define and constrain administrative discretion have occurred throughout its history.  In part, the building of the American national government was accomplished by the creation of administrative structures.  Efforts to tame the bureaucracy were essential because of the bureaucracy’s role in implementing laws, adjudicating disputes, and distributing benefits and largess.  In the nineteenth century, staffing of the federal bureaucracy through the spoils or patronage system led to corruption and inefficiencies.  This concern over spoils lead to the adoption of the Pendleton Act, America’s first civil service act, in 1883.  The growth of the American administrative state during the presidency of Franklin Roosevelt in the 1930s and 1940s led first to further expansion of civil service reforms, then to the passage of the Hatch Act in 1939 which limited the political activity of federal employees, and then to the adoption of the Administrative Procedure Act in 1944.  All of these reforms sought to constrain or tame presidential power, promote neutral competence (political neutrality), and accommodate bureaucratic power with the goals of American constitutionalism.
    The United States Supreme Court contributed to this limiting of discretion with several of its decisions.  For example, the government must have hearings prior to termination of benefits (Goldberg v. Kelly, 397 U.S. 254 (1970)).  However, even with this due process or procedural requirement, the Court has given broad agency discretion to use rule-making versus adjudication when making rules (Securities and Exchange Commission v. Chenery Corp, 332 U.S. 194 (1947)).  It has also charted out deference to reasonable agency interpretations of law if statutes are silent or Congress has not spoken on the issue (Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984)).  But Chevron deference to an agency interpretation applies only if it is clear that Congress intended to give it the authority to make rules carrying the force of law.
    The point here is that there is in the United States a well developed body of statutory and case law defining the boundaries of administrative discretion.  These limits curb executive power, corruption, and protect individual rights through the development of procedural regularity, judicial review, and defining the proper boundaries between bureaucratic and other government actors.  But given that the reforms in administrative law transpired at the same time the American administrative state was expanding to regulate the economy, they also served to build state institutions, improve their performance, and to enhance the economy by way of correcting market failures.
    In summary, the law that has developed in the United States is one that requires government officials to follow specific rules when making decisions.  These decisions, if they do not respect what is called due process of law, are subject to review by the judiciary in the United States.  Judicial review of administrative decisions has helped to limit bureaucratic discretion.

Transparency and Openness In Making Decisions
    A second major value important to limiting government corruption and inefficiency is the concept of transparency.  The idea of transparency refers to the mandate that all government decisions should be made in a open fashion, subject to coverage by the media and review by citizens.
    There are many rules promoting transparency.  Perhaps the most important laws regarding transparency at the national level in the United States are Freedom of Information Act and various open meeting laws.
    In terms of the Freedom of Information Act (FOIA), the law dates from 1966 and it allows for citizens and the press to request documents from the government unless they are otherwise classified as secret.  The goal of this Act is basically state that all information that the government has is open to inspection by the public.  Over its nearly 50 year history the ACT has resulted in tens of millions of government documents being released to the public.
    In addition to the FOIA at the federal level, many state and local governments have their open freedom of information acts.  Along with these laws, all levels of government in the US have what are called Sunshine Acts or Open Meeting Laws.  Six years after passing the Freedom of Information Act, Congress enacted the Federal Advisory Committee Act to open up to public oversight the advisory process of executive branch agencies. Since 1972,  FACA has legally defined how advisory committees operate and has a special emphasis on open meetings. In 1976 Congress adopted the Government in the Sunshine Act, which requires that certain government agency meetings be open to the public.
    In general, these three laws have had a dramatic impact on government decision making.  They establish a general presumption that decisions by government officials and agencies are presumed to be made publicly and that citizens and the media have a right to be able to review choices.  For the most part most government officials voluntarily accept these laws as binding and part of their duties.  But these laws are also enforceable by citizens and the media, both of which may go to court to have violations of the law reviewed and enforced by the judiciary.  Thus, these laws do not just exist in theory, but they have real force to affect bureaucratic behavior.

    The creation of a constitutional ethic of public service has been an important  way for the United States to promote efficiency and reduce corruption in government.    This ethic is a combination of both the creation of subjective beliefs and objective procedures that reinforce a commitment to democratic governance among bureaucrats.  Among the values that are part of this constitutional ethic are those that limit bureaucratic discretion and which promote openness and transparency in decision-making. 
    While this talk has focused mostly on the United States, many other democratic or emerging democratic countries have adopted similar values.  The question that I leave you with is how the lesson from the United States can be applied in Russia and to its bureaucracy to help it combat corruption and inefficiencies.

1 comment:

  1. corruption and inefficiencies are human characteristics that we can all fall victim to, we need to point them out to each other so we recognize them when we see them.