The Government Reform Series: How to Avoid Government Failure

Editor’s Note: Government failure is something everyone complains about, but does little to address. Over the next two weeks, FixGov will review work on government reform: identifying problems in the federal government and offering solutions to get government back in working order. In this post, John Hudak reviews Why Government Fails So Often And How It Can Do Better by Peter H. Schuck.

In the new book Why Government Fails So Often And How It Can Do Better, Yale Law Professor Peter Schuck profiles a substantial list of government failures over time. Many government programs have fallen short of their goals and/or been cost inefficient. In other cases, the government constructed programs that either did little to remedy an existing societal problem or displaced a market that could have resolved this issue more efficiently. And in still other cases, government was unable or unwilling to use data and analysis to improve public programs in ways that advance policy goals and avoid failure.

Schuck starts with the premise that problems exist in society, in policy, in markets, and elsewhere that need resolution. Government tries to resolve such problems with policy agendas and specific programs. Schuck notes that even though government is not always the solution, it is frequently the intervening force.

The challenge, of course, is that government is not simply a mechanic working on an engine who can diagnose a problem and replace the necessary parts. Instead, government is a combination of different, often competing or opposing entities driven by a diverse set of forces: public opinion, industry, interest groups, and self-interest. The result is policy or individual programs that do not reflect the best, cost-efficient, informed, but rather ones that emerge from fights and compromises among competing interests and institutions. Ultimately, the book centers on these multiple tensions that exist in policy making and how they produce a government that works against itself in multiple ways.

It is no surprise, then, that government often fails, and Shuck offers an exhausting description of the reasons why failure happens, noting that complexity and interactions of causes are often difficult to sort out. He lays much of the blame at the feet of the legislature. Congress, beholden to individual and group interests that seldom agree, serves as the maternity ward of public policy and is prone to malpractice. Shuck notes that Congress asserts impossible demands, hampers policy innovation, under-funds and otherwise restricts federal agencies, and fails to addresses the necessary subsequent changes that assist in implementation.

However, Congress is not alone. Schuck points to faulty implementation, scattered bureaucratic organization, shortcomings in the federal workforce, poor executive leadership, and fraud as key sources of governmental failure, among dozens of contributing factors. He illustrates the causes of such failure with an impressive list of examples of agencies, actions, policies, and programs. As heavily as the book uses anecdotes of failure, it also provides a substantial review of the extant literature—in public policy, economics, political science, psychology, sociology, organizational leadership, etc.—to understand the nuance of these issues.

Schuck also highlights one easily avoidable source of government failure: the underuse of performance data. Government collects data on various measures of effectiveness, cost and personnel. The purpose of these metrics—some dating back decades, others borne from efforts in the Clinton and Bush Administrations—are meant to give agencies and Congress the information necessary to make improvements. Schuck paints a picture not of program-level failure, but of macro-institutional failure to use data to change, improve, or, when necessary, shutter government programs. The prescription here is policy- and program-level tinkering, and government seems totally unwilling to invest in what is necessary to do so.

Schuck often contrasts failure in the public sector with success and efficiency in the private sector. While such differences are important to distinguish, the author often oversells private sector effectiveness and undersells failures. That said, Schuck notes the agility and often eagerness of private entities to use up-to-date, accurate data (on a variety of topics) to improve effectiveness, boost competitiveness and generate market advantages. The public sector—despite having many tools to do the same—fails to do this.

The public sector’s shortcomings in the use of evaluative data and its willingness to make concrete, timely, and flexible improvements, Schuck argues, emerges largely because of poor incentives within government. In some cases, government employees, agencies, executives, appointees, and Congress see little to gain from such efforts. In other cases, statutes and regulations can literally restrict government from being responsive to the very data it collects in the name of making improvements—Schuck labels this problem “inflexibility.”

Later in the book, Schuck revisits the issue of incentives, but this time in a different setting. In this context, Schuck argues that government failures often occur because programs do little to change the incentives and behaviors of those the program seeks to affect. The design of policies focuses little on channeling behaviors and motivating businesses, citizens, and other governments to pursue different of modified outcomes. Programs that do focus more on behavioral incentives, Schuck argues, are less susceptible to failure.

While this book has much to offer, it also comes with some substantial challenges of its own. As strong as it is in its descriptive nature—of anecdotes about government failure and a review of the literature—it is light in its analytical approach. It relies heavily on lists and catalogues of causes and contributors to failure—lists that often grow too lengthy, particularly in combination.

The book also approaches government, policy, and programming from such a gloomy perspective that, at times, one is left to wonder if government can do anything right, if there is a single agency that is well managed, if any government employee is competent, and if Congress has ever produced a policy based on evidence. Little credit is given to government working, bureaucrats performing up to or exceeding their potential, and agencies being innovative. This happens. It happens often. The author’s laser focus on all that is bad in government does a disservice to the good and can contribute to one of the very causes of government failure he highlights in the early chapters of the book: a public that has lost all confidence in its government’s ability to do the right thing.

In fact, although Chapter 11 focuses on policy successes and programs that have produced positive results, the author spends substantial time highlighting the problems and failures within these programs. In sleuthing for government failure, Schuck is quite comfortable delving into the minutiae of government programs and decision making. However, when searching for successes, he appears allergic to such detail.

The book’s description of the causes of government failure offers a stronger contribution than its proposed “Remedies,” the title of Chapter 12. Schuck notes that some reforms—cultural and constitutional ones—are too broad, obtuse and/or are political non-starters, and he is right. He briefly reviews them, but his focus is on what he describes as “cross-cutting reforms” which are more discrete and piecemeal and address important changes like incentives(mentioned above) including the reduction of moral hazard, using information and data to improve government, a reform of the civil service, and a simplification of government’s intervention efforts. They are reasonable, thoughtful, and substantial proposals, promoted by numerous students of government over the years, and that would improve the ability of government to meet citizens’ needs and demands.