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ОглавлениеA Survey of Bureaucratic Control Mechanisms
Across the fields of public administration, sociology, economics, and political science there is a large literature examining questions about bureaucratic control, the nature of control, and, finally, the appropriation of the principal-agent theory from economics to study the bureaucracy. In this chapter, I provide a review of the major assumptions in the literature and the evolution for how scholars have approached the issue of bureaucratic control.
Scuttling the Spoils System
As the United States expanded westward in the 1820s under the aegis of President Monroe’s “manifest destiny” coupled with technological improvements from the industrial revolution, and universal white male suffrage, the U.S. federal government needed to expand in size in order to keep pace with the growing items on the national agenda. Unlike the state-building that was occurring in Germany and British monarchies during that time, the United States was an experiment in the common man ruling himself. Constructing an edifice of government in a democracy, with the United States’ unique and strong system of checks-and-balances between the branches of government is more difficult where large public policy changes are very hard to maneuver through the different branches (Fukuyama 2014).
Andrew Jackson, the first non-eastern man elected president in 1828, strategically viewed using the spoils of office to advance his political agenda. The “spoils system” was created whereby government jobs were given to party loyalists in exchange for or in reward for political loyalty. This system created a pernicious and corrupting effect on the U.S. bureaucracy as jobs were not awarded by merit, unlike the German and British systems, but rather on political patronage. Under the system, friends of politicians were appointed to positions across the government. It had a corrosive effect on good governance giving rise to machine politics and corruption as public funds and political favors were exchanged for public office (Fukuyama 2014). Indeed, both members of Congress and the president benefitted from the system as it helped build political coalitions and ensured that government employees were loyal; shockingly, President Taylor replaced 30 percent of all federal workers during the sixteen months he served as president before his death in July of 1850 (Fukuyama 2014). Though the United States needed a better and more efficient bureaucracy in order to address issues on the national agenda, reforming the spoils system was very difficult since the politicians tasked with governing the country gained great personal advantage from the system.
After much political maneuvering, in 1883, The Pendleton Civil Service Reform Act was signed into law by President Arthur who succeeded President Garfield after his assassination by a man who claimed that he was owed a patronage position within the growing federal bureaucracy. The Pendleton Act effectively ended widespread use of the spoils system and its passage marks the birth of the modern bureaucracy in the United States (Fukuyama 2014). Specifically, the Pendleton Act made it illegal to require federal workers to pay dues to political parties, it instituted a “merit system” whereby office-seekers would have to prove their qualifications for the job through a civil service exam, and it also insulated many layers of positions within the federal government from political appointments (Kollman 2017). With the United States growing rapidly at the end of the 1800s with industrialization and modernization, the country needed a more effective bureaucracy to execute important tasks such as regulating railroads and laying telegraph lines. It substantially decreased the number of patronage (political) appointments and mandated that federal employment be based on merit rather than political party. In addition, it set uniform rules for promotion that were followed across the growing bureaucracy. Vestiges of the spoils system remain today, however, as the United States still has more political appointees in government than any other modern industrialized country (Fukuyama 2014). Indeed, political appointees hold every cabinet appointment and many other important positions across the U.S. government.
Public Administration: Political/Administration Dichotomy and Max Weber’s Ideal Type
Examining the relationship between politics and the administrative state was a topic that then future president Woodrow Wilson advanced following his PhD from John’s Hopkins University in political science in 1886. As a student of American government, he argued that the growing U.S. bureaucracy and its relationship with Congress and the president needed to be studied systematically (West 1995). In his view, the purpose of government needed to address two fundamental questions: (1) What public goods should the government produce? and (2) How should the government provide it? He advanced the idea that the provision and production of public goods were fundamentally different. The provision was a political issue that elected officials must decide and the production issue—meaning how the bureaucracy implemented the policy—was divorced from politics (Wilson 1887). Essentially, it is possible to separate politics and administration because implementation is a nonpolitical issue (Wilson 1887). This bifurcation implied that execution of policy was apolitical and, importantly, there was not a control problem because bureaucrats would implement orders with fidelity and efficiency.
This dichotomy between politics and administration that Wilson promoted foreshadowed Max Weber’s “ideal type” bureaucrat and later the principal-agent model (Fukuyama 2014). Weber argued, similar to Wilson, that an “ideal” bureaucrat was a professional whose expertise furthered the mission of the bureau (Olsen 2008). Not only were bureaucrats chosen based on merit, but they were also neutral and impartial in executing the law with integrity. A bureaucrat’s loyalty was to his profession and the state (Olsen 2008). Again, in this Weberian vision of an efficient, effective, and impartial arbiter to execute laws, the locus of political decisions does not reside with bureaucrats. In the production of public goods, the implementation of policy, a Weberian bureaucrat would carry out his duties. Like Wilson, the notion that there was potentially a concern with bureaucratic control was illogical. The overall assumption was that the bureaucracy was a rule-bound institution with technical expertise that would execute the tasks entrusted to it by those who make the laws. This view advanced the idea that elected officials made provisioning decisions through a political process and bureaucrats implemented the policy efficiently, effectively, and impartially (Moe 1991). Given the dichotomy divorcing politics from the execution of policy, the public administration literature concluded for fifty years that a control problem over the bureaucracy did not exist. In fact, there was no vocabulary to entertain the notion of bureaucratic control.
Beyond the Dichotomy: Views from Post–World War II Political Scientists and Public Choice Theorists
Weber, however, did recognize the inherent asymmetry between bureaucrats (agents) who possess the technical expertise over a particular policy area and their managers (principal) who are tasked with providing overall direction (Miller 2005). This anticipates the later principal–agent framework and also implies that there is, or could be, a control issue. Post–World War II scholars rejected this false dichotomy between administration and politics and argued that bureaucrats and bureaucratic decision-making were inherently political (Long 1949). Not only do bureaucrats operate in a political environment, but they also have a “political character” which affects their policy outputs (Appleby 1949). Further, this line of literature also argued that the inherently hierarchical nature of bureaucracies placed increased emphasis on an individual bureaucrat’s judgment about what issues to elevate to superiors, and which ones to handle themselves (Appleby 1949). Therefore, the twin complexities of bureaucrats operating in a political environment and also exercising discretion in what information to share, or not, necessarily implies issues concerning bureaucratic control. How can superiors provide the right incentives and the optimal organizational structure to ensure compliance with their wishes?
While scholars recognized that a political environment necessitated a control issue, the literature also advocated that bureaucrats had preferences in their own right. Though according to Weber the locus of bureaucratic power stems from technical expertise and asymmetric information, he does not fully account for individual motivation or preferences of bureaucrats themselves. This school of thought borrowed theories from economics and applied it to the administrative state. First, bureaucrats have discretion in how they implement policy and can be legislators in their own rite (Friedrich 1940). Second, it recognizes that bureaucrats can act in a rational manner that maximizes their own economic self-interests, namely budget maximization, that preserves their jobs and ensures that their bureau, like a business, will remain a going concern (Niskanan 1968).
The majority of this literature focuses on explanations for the growth of government with the recognition that bureaucrats may have independent preferences from their superiors. In short, bureaucrats have an informational monopoly over their legislative managers. The legislators have no ability to access independently what the bureau’s production function for provisions are; therefore, senior bureaucrats can act as discriminating monopolists, extracting as much surplus budget from the legislature as they can. This is the idea that unconstrained government growth comes from bureaucrats who want to maximize their budget and ensure the health of their bureau. This overproduction of provision increases the size of government faster than the private sector (Niskanan 1971; Buchanan and Tullock 1977). The essential insight from this literature, however, is that bureaucrats have preferences that may be hidden and may be independent from Congress and the president.
In sum, the post WWII literature rejected the idea of divorcing politics and administration and also recognized that bureaucrats not only have their own preferences but they also may work independently from the president or the Congress to achieve them. Again, borrowing from economics, the political science literature appropriated the principal-agent theory to investigate the extent of the Weberian informational asymmetry and the impact of heterogeneous preferences on political control (Miller 2005). It formalized the notion that there must be explicit controls on the bureaucracy to constrain growth and to implement the legislature’s or the president’s wishes with more fidelity (McCubbins, Noll, and Weingast 1987; Moe 1984). The model addresses the arguments raised in the literature that bureaus are fundamentally a political entity as well (Appleby 1949) and that bureaucrats may have different goals than their principals (Niskanan 1971; Buchanan and Tullock 1977). Further, it enables scholars to gain insights regarding how variation across political contexts and policy domains will affect delegation strategies (Huber 2000).
Current Orthodoxy in Political Control: Assessing the Hierarchical Control Mechanisms from Congress to the President
From the 1980s to the present day, the principal-agent theory has become the most widely used formal model in bureaucracy studies to untangle the hierarchical relationship between a principal who makes policy and an agent who implements the policy directives. Broadly, the model assumes a dyadic relationship whereby one principal directs one agent to fulfill his orders; however, due to informational asymmetry and heterogeneous preferences between the pair, the agent may not implement the principal’s wishes with fidelity. This can lead to agency loss whereby the entirety of the principal’s injunctions is not realized (Lowery and Marchetti 2012).
The political control literature has contributed to our understanding about the levers of power that different principals can employ to influence the bureaucracy. For instance, Congress, the courts, and the president utilize different tactics in order to exert their authority on bureaucratic policy-making and program implementation. The literature to date has largely mirrored the disconnected organization of the bureaucracy itself providing nuggets of evidence that the locus of bureaucratic control resides with these different political principals. The majority of studies neither directly test the influence of competing principals in the same model (exceptions include Carptenter 1996; Clinton et al. 2014; Wood and Waterman 1991; Potter 2017) nor do they employ a cross-sectional approach across different bureaus. This double-faceted problem in the literature impedes more generalized inferences about the relative political control across the myriad of offices within the U.S. bureaucracy.
Congressional Dominance Theory
The Congress and the president are the only two principals who have a direct constitutional role in overseeing and managing the bureaucracy. The scholarly literature offers two competing theories asserting supremacy from the Congress or the presidency over the bureaucracy. A Congress-centered approach, advanced by the congressional dominance theory assumes that a member of Congress’s reelection motivation is the overriding principal behind their efforts to influence the bureaucracy to serve constituent interests (Mayhew 1974; Moe 1987; Fiorina 1989). This approach cites evidence that the legislature as a whole exerts its policy preferences in agency decision-making through three primary means. First, they direct bureaucratic actions through specific language in statute (Huber and Shipan 2002) that can either constrain or enable bureaucratic discretion depending on the specificity of the law’s directives. This is ex-ante statutory control (Ringquist et al. 2003), whereby bureaucratic action is controlled before policy implementation from the bureaucrats begins. The congressional dominance theory advances the idea that the legislature is the primary principal directing bureaucratic actions through statutory language allowing varying amount of discretion (Huber and Shipan 2002). Congress then monitors adherence to statutory delegation and program implementation through oversight hearings.
Second, the Congress can reprimand bureaucratic agencies after some malfeasance has occurred though ex-post committee oversight hearings (Weingast and Moran 1983). In this scenario, a third party such as a citizen or an interest group will pull the proverbial “fire alarm” and alert members when an infraction has occurred (McCubbins and Schwartz 1984). Once alerted, Congress can take steps to remedy the situation and reward or punish agencies as needed. This is an efficient and effective form of oversight, but there is selective sampling just on what affects a third party. Finally, Congress and the president jointly share the power of budgeting. Every year, annual appropriations for agencies throughout the government are made and approved by both Congress and the president. Agencies need the Congress to continue approving and funding their programs, providing them a keen incentive to remain attentive to congressional wishes (Fiorina 1989; Fiorina 1977). Budgets are an important tool the Congress can use to reward or sanction agencies (Moe 1987), and the Congress grants agencies much of the power they enjoy through statute (Kennedy 2014). The Congress, however, is the final actor in the budgeting process (Wildavsky 1984) since they respond to the president’s budget proposals.
Presidential Sovereignty
Congressional primacy, however, is contested by scholars who assert that the president is better able to manifest his preferences on the bureaucracy. The presidential sovereignty thesis also resides in three mechanisms: appointment power (Moe 1994; Wood and Waterman 1991), (re)organization (Meier 1980), and budgeting (Wood 1988). The president, as the chief executive, has the ability to shape the bureaucratic leadership, through patronage appointments, most of whom the Congress does not approve. Political appointees ensure that presidential priorities are implemented and that department policy is congruent with his ideology. Every single cabinet secretary is a political appointee along with the top leadership at almost every agency. Political appointees are a powerful tool in the presidential arsenal to shape the agenda of agencies, determine their policy priorities (Lewis 2008; Wood 1988; Wood 1991), and interpret ambiguous congressional language in statute so as to ensure that it conforms to the president’s philosophy (Lewis 2009). The spoils system has not been completely vanquished from the modern bureaucracy.
Further, the president has the ability to reorganize the bureaucracy to streamline the reporting structure, shape how agencies are run, and implement pet programs. For instance, President Kennedy’s creation of the Peace Corps program initially without congressional consent exemplifies the institutional power the president has to shape policy direction. President Kennedy created the Peace Corps via Executive Order 10924 in 1961. In it he established an agency of the Peace Corps within the Department of State, to be funded by the Department of State. The purpose of the Peace Corps was “training and service abroad of men and women of the United States in a new program of assistance to nations and areas of the world.” (Executive Order 10924, 1961). Though programs such as the Marshall Plan and other national assistance programs had been established at the end of World War II, Kennedy looked to establish a volunteer organization to help economically disadvantaged countries and bypassed Congress with its creation. As William Howell details: “For several years prior, Congress had considered, and rejected, the idea of creating an agency that would send volunteers abroad to perform public works. . . . Democrats refused to put the weight of their party behind the proposal to ensure its passage” (Howell 2005). With Kennedy unilaterally creating the Peace Corps in 1961 and then redeploying contingency accounts within the Department of State to fund it during its first year, he effectively reorganized part of the State Department to fund a program important to him. Basically, Kennedy grew tired of waiting for Congress to authorize and appropriate funds for a new program he wanted to create. By issuing an executive order and establishing it outright, he created a new agency and then, strategically, placed Congress in a very uncomfortable position of cutting hundreds of jobs and halting the spread of good-will from volunteer Americans across the developing world. Even though many members of Congress were generally opposed to its creation since it served as a vehicle to dodge the draft, with the program effectively running, through Kennedy’s unilateral action it was a fait accompli and Congress formally approved the program in 1962.
Along with appointment power and reorganization, budgeting is a shared tool between the president and Congress. They jointly must agree on funding levels for agencies annually, and budgeting is “the battleground upon which many of the most significant policy debates [between Congress and the president] are fought” (Canes-Wrote, Howell, and Lewis 2008, pg. 8). Congress effectively delegated budgeting power to the presidency in the Budget Reorganization Act of 1921. Due to the collective action issues facing Congress, it was easier for one person, the executive, to propose a blueprint budget for agencies for the Congress then to consider. The delegation, therefore, gives the president first-mover advantage with regards to agency budgeting (Ragsdale and Theis 1997), thus imprinting his preferences prior to congressional action. Even though Congress is the final decision-maker in budgeting, they are largely operating in an informational disadvantage and are reacting to what the president has proposed (Moe 1987).
External Actors
While the president and the Congress are the only two principals that have specific constitutionally enshrined oversight of the bureaucracy, there are other actors in the network that influence bureaucratic decision-making (Hill 1991). The courts have less direct control on bureaucratic daily business since they only have veto power and not agenda-setting power (Spriggs 1996; Canon and Giles 1972). Further, in a departure from a direct principal-agent framework, extra-governmental organizations’ influence, such as interest groups, are relationship based and can form an interdependent information exchange between the regulated and the regulators (Yackee and Yackee 2006; Lowery and Brasher 2004). The public, in the form of public opinion, also influences policy change across government and have an interest in having their preferences reflected in the bureaucracy (Stimson, MacKuen, and Erikson 1995, 2002). While the literature has progressed in recognizing that hierarchical control models must account for multiple principals (Moe 1984), there is no integrated theory predicting when each principal is important and under what conditions which particular principals can exert more or less control to have their preferences reflected in bureaucratic policy.
Bureaucratic Autonomy
At its core, principal-agent theory is primarily concerned with studying the ubiquitous problem of delegation: How much discretion does a principal delegate to an agent and what are the consequences of the delegation for getting work accomplished, or policy implemented in a manner that is congruent with the principal’s wishes (Kiewiet and McCubbins 1988). In disentangling whether the Congress or the president has more influence over bureaucratic activity, some agencies are created to have more independent policy-making authority outside of the Cabinet (Kollman 2017). Typically, they are governed by a board that serves staggered terms so that different presidents, often of different parties, can make appointments. The Federal Communications Commission (FCC) is an example of an independent agency. It has six commissioners some of whom were appointed by President Obama, some nominated by President Trump, and some are Obama’s appointments renominated by Trump once their term expired. The FCC’s mission is to regulate “interstate and international communications” (“The FCC’s Mission,” 2019). It grants licenses and promulgates regulations largely independent from direct Congressional or presidential influence and neither principal can remove the FCC’s leadership without cause. Unlike other political appointments, commissioners serve not at the pleasure of the current president, but until their term has ended.
Independent agencies exercise more autonomy from their political principals, and there are conditions that engender some agencies from operating more independently from their political masters. Daniel Carpenter defines bureaucratic autonomy as “occur[ing] when bureaucrats take actions consistent with their own wishes, actions to which politicians and organized interests defer even though they would prefer that other actions (or no action at all) be taken” (Carpenter 2001, 4), and this gives rise to independent policy-making power. It occurs when an agency: is an active participant in writing laws that govern them (MacDonald 2015), has the staff capacity and policy expertise to resolve problems that occur, and responds to interest groups but is not captured by them (Fukuyama 2014). Further, the bureaucracy has an informational advantage over Congress and the president since they are not only repositories of expertise but they are also suppliers of vital information upon which many important policy decisions are made (Workman 2015). Moreover, often the farther an agency is from its political masters, the more that political influence it can wield (Selin 2015; Kennedy 2014). Agencies can, at times, largely operate outside of traditional principal–agent relationships with Congress and the president and can exercise more policy-making authority over their sphere of influence.
Peeking under the “black box”: An Agent-Centric View of Political Control
Understanding delegation from Congress and the president, however, is the core of the principal–agent problem. Utilizing the principal–agent model, however, does not necessarily represent a panacea toward understanding what occurs within the “black box” of the bureaucracy. Moe (1984), who introduced the principal–agent model to bureaucratic scholarship, argued that the this model was powerful because of its parsimony in identifying specific “aspects of individuals and their environments that are most worthy of investigation and it integrates them into a logically coherent whole” (p. 757). The theory enables scholars to observe a series of interactions between a single principal and a single agent, and to understand the different incentives, agency loss, and moral hazard inherent in particular situations. To the extent that these observations are generalizable to other, similar situations within the bureaucracy is part of the power of the model. Yet, Moe also argued that the model’s parsimony was also one of its weaknesses with the empirical reality of multiple, competing principals, different behavioral expectations for workers, and different organizational contexts. He cautioned that application of the simple principal-agent framework “may severely distort rather than clarify” (p. 773). In short, the principal-agent model is valuable, but must be used cautiously. It is critical to recognize the inherent complexity with multiple principals and also the diversity of tasks across organizations. Competing principals’ political control is an important factor in understanding which one is more influential over bureaucratic policy.
Accepting Moe’s proposition that bureaucratic control rests with multiple principals, the current theoretical framework focuses entirely on the principals and completely ignores the bureaucracy. He (Moe 1987) comments that the congressional dominance thesis is
almost entirely Congress centered. It offers strident arguments that Congress controls the bureaucracy, but it develops nothing that can be called a logic of control and pays precious little attention to the bureaucracy. It builds on theories of legislative and electoral institutions without putting them to effective use in understanding bureaucratic behavior. (476)
I argue, as an extension of Moe, that previous explanations within the principal–agent framework, including the congressional dominance and the presidential sovereignty theories, are limited in extending scholarly understanding to the bureaucracy; rather, they help clarify how different institutional principals exert control. Moreover, the extant literature offers competing and often contradictory theories about which principal exerts more, or less, control over the bureaucracy—but offers no overall framework to disentangle when one principal might have more or less influence over bureaucratic policy-making, or when the bureaucracy might assume control over itself. In effect, current theories are all principal oriented in the principal-agent framework, and do not provide evidence on how the agent, the bureaucracy, might respond given competing principals’ agendas, or when political control is largely absent. Scholars using this framework may conclude, based on empirical observation, that political control exists but fail to consider the alternative explanation that the outcomes observed may be a result of the characteristics internal to the bureaucracy itself (Meier and O’Toole 2006; Kennedy 2014; Selin 2015). To this end, the principal-agent framework is underspecified and therefore can lead to erroneous inferences.
In this study, I will take a different approach and look at bureaucratic politics from the “agent” perspective. I will work to peek under the “black box” of bureaucratic policy-making. In effect, rather than a principal-agent framework, I will utilize an agent-principal model to understand when the preferences of different principals are more or less important to the bureaucracy. In this framework, using the agent as the starting point for analysis requires bottom-up investigation within the bureaucracy to understand how internal characteristics can explain variation in top-down control from different principals. This is the overall goal of this study in taking a bottom-up view of the bureaucracy: recognizing the diversity across the bureaucracy and examining variation in the internal characteristics of the bureaus themselves.
This study will attempt to answer: Why and when do political actors exert different levels of political control over the bureaucracy? Under what conditions do different principals have their preferences reflected in bureaucratic policy? The answers to these questions have implications for the degree of democracy and democratic control the public can expect to exert on the bureaucracy. In analyzing this relationship, the extant literature has often relied on a case-study approach (Moe 1987; Weingast and Moran 1983; Ringquist et al. 2003; Balla 1998; Carpenter 2001) in order to make broad generalization about bureaucratic behavior without recognizing the enormous heterogeneity across the federal bureaucracy in terms of workforce structure, composition, and responsibility. Without attentiveness to the inherent variation across the bureaucracy, generalizing from a handful of case studies cannot lead to a broader understanding of how the bureaucracy works, or a positive theory of bureaucratic control (Lakatos 1968).
Following a discussion in the next chapter about the shared power of budgeting between Congress and the president and the nature of budgeting, reworking the principal-agent theory to accommodate a broader relationship between principals and agents is the motivation behind the agent-principal model presented in the chapter 4.
