Bureaucratic Leverage

Why do we hate bureaucracy?

Taken literally, a bureaucracy is just an organization tasked with ensuring some outcome. In the public sector, OSHA ensures worker safety, FDA ensures drug safety, EPA ensures environmental protection; in the private sector, HR ensures legal compliance, IT ensures trade secrets and data privacy, and so on. Yet even if people agree with the outcome, they often disagree with the implementation. Bureaucracies have an endless talent for finding wasteful and ineffective solutions.

Bureaucracies are ineffective due to a lack of accountability. If a bureaucrat imposes a wasteful policy, what are the consequences? Well, as long as they are achieving their desired outcome, they are doing their job, regardless of the pain they inflict on others. They can wield legal, technical, or financial penalties to force compliance. And paradoxically, when bureaucrats fail to achieve their desired outcome, they often get a bigger budget or a bigger stick to wield, rather than being fired for incompetence. The inability to recognize failure goes hand in hand with the inability to recognize success: competent and ambitious people avoid working for bureaucracies because their efforts go unrewarded. Bureaucracies end up staffed with middling managers, and we have learned to hate them.

I don’t know how to solve this problem in the public sector, but I think it’s solvable in the private sector, because there is theoretically a CEO who is incentivized to maximize the overall effectiveness of the company; they just need the right tactics. The solution is simple: hold bureaucracy accountable by forcing them to do the actual work.

I feel like there’s a counter argument to be made in here about the role of competition in the work produced for external entities to do.

In a functioning capitalistic system, you have several competing entrepreneurs who are testing all kinds of novel ideas against the rules established by the government to ensure a safe, fair playing field.

The role of a bureaucracy is not to get to the end goal faster. The role of bureaucracy is to make sure we get to the end goal without taking harmful shortcuts.

Regardless, there is something to be said about being thoughtful in imposing burdensome policies, and I think this concept of bureaucratic leverage is an interesting way to consider the role of the public sector in optimizing our systems.