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What If Anything Is Wrong with Big Government?

Author(s): Richard Rose


Reviewed work(s):
Source: Journal of Public Policy, Vol. 1, No. 1 (Feb., 1981), pp. 5-36
Published by: Cambridge University Press
Stable URL: http://www.jstor.org/stable/3998168 .
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7nl Publ. Pot., I, I, 5-36
What if Anything is Wrong with
Big Government?*
RICHARD ROSE Centre for the Study of Public Policy,
University of Strathclyde
ABSTRACT
Starting without any a priori assumption that government is necessarily a
force for good or ill, this article examines what negative consequences are
likely to arise from big government - or government growing bigger still.
Three generic effects are postulated: a loss of effectiveness, because of the
use of weaker means-ends programme technologies for new programmes; an
increase in contradictions between existing, growing and new programmes;
and a possible reduction of consent, insofar as growth increases the 'im-
propriety' of government actions. The growth of government is shown to be
'unbalanced', that is, to occur in incommensurable ways and at varying rates
for major resources (government revenue, personnel,
and laws); government
organizations; and programme outputs. The different character of growth in
each element is examined, and particular consequences hypothesized for
resource elements singly, for internal characteristics of organizations, and for
their combination in programmes. The analysis suggests that while much
growth involves no intrinsic problems of size (as long as economic resources
are available to meet the costs), there is likely to be disproportionate loss of
effectiveness,
and increasing contradictions between programmes if big
government grows bigger still.
Introduction
Government is big in itself, in its claims upon society's resources, and in its
intended impact upon society. Equally important, government is dynamic
not static: recurringly it grows bigger still. Critics argue that its activities
should be limited so that it becomes less big, or even contracts to the small
scale of an earlier era. By almost any conventional indicator, government
*
This paper is an outgrowth of a continuing seminar on the Growth of Government at
the Centre for the Study of Public Policy. I am indebted to its members for the
exploration of ideas, and particularly to Richard Parry for research on the growth of
government in the United Kingdom since 1945.
In addition, I would like to acknow-
ledge useful critical comments on drafts of this manuscript received from Brian
Hogwood, Johan Olsen, Edward C. Page, B. Guy Peters and Aaron Wildavsky.
6 Richard Rose
- whether viewed as a single institution or a complex of organizations -
dominates much in every Western nation; the chief difference from nation
to nation is the degree of its bigness.
Historically, the growth of government to its present size represents a
great triumph for the modern state. When the prototypical institutions of the
modem state were evolving in the nineteenth century, government's activities
were relatively few (Rose, I976). Even
though
the present scale of public
policies was not anticipated in the constitutions of modern states, government
institutions have become able to provide the services of the contemporary
mixed economy welfare state. To argue in favour of 'small is beautiful' is to
prescribe an anachronistic or Utopian response to the fact of bigness in con-
temporary societies. The conditions that have brought about the growth of
government are not easily reversible. And other institutions in society -
business corporations, trade unions and universities - have grown big too.
The immediate issue is not whether government should be big, but what
significance to attribute to its present observed size.
Politicians usually praise or denounce big government on a priori grounds.
Because the growth of government has occurred approximately in parallel
with the expansion of the franchise, big government can be praised as a con-
sequence of individuals learning to co-operate to provide collectively for their
needs and to mobilize for effective action against traditionally entrenched
ruling groups. The proximate cause of big government, the provision of
education, health and income maintenance grants, is welcomed because these
welfare benefits are regarded as 'good' goods. A review of public opinion
about the welfare state in Western nations concludes: 'Active government
involvement in providing a basic level of economic and social well-being
for the citizenry is everywhere a matter of majority public acceptance'
(Coughlin, I980, 25).
The reason for the popularity of major government
policies is easy to see: they provide major benefits for nearly every family in
society (Rose and Peters, I 978, 2 56-59).
Conversely, critics of big government often argue from normative grounds
that it is improper for government to expand beyond the minimalist
measures of the nightwatchman state. For example, Seldon (I979, 7i) has
calculated that two-thirds of public expenditure by British government could
be eliminated, if government were to confine its activities to the 'necessary
evil' of providing public goods. Marxists have agreed with market econo-
mists that big government is pathological: they see it as a sign of the coming
collapse of a business system that uses government measures to compensate
for its weakness (O'Connor, 1973).
In reality, the great bulk of the polemics about big government is about
government per se, and not about the size of government. If government
actions are thought to be intrinsically good, then the more that government
does, the better society will be. If government is thought to be a bad thing,
What if Anything is Wrong with Big Government? 7
as market-oriented critics argue, then the bigger that government is, the
worse will be its effects upon society. The virtues or faults of government are
not a function of scale; they are assumed to be intrinsic to the nature of
government.
Moreover, many of the major problems facing societies today are not
related to the size of government. The significance of an issue depends upon
the intensity of its effect, as well as upon the numbers affected. For example,
capital punishment can be an issue of intense concern, albeit the numbers
immediately affected are small. Many issues are important because of their
pervasive impact upon the authority of government. This is true of the
challenge to the authority of the United Kingdom presented by three per
cent of its population in Northern Ireland today. In the United States,
Watergate involved only a handful of people, yet it greatly affected
Americans' confidence in government. The seizing of 52 American hostages
in Iran in I979 challenged the authority of the United States even though
the hostages were a trivial proportion of Americans abroad or at home.
The purpose of this article is to consider whether there is necessarily
anything wrong with big government. It starts without any a priori assump-
tion that government is necessarily a force for good or ill. The primary
assumption is that big government is different from the minimalist night-
watchman state. This article explores what logical and empirical grounds
there are for believing that big government, for reasons necessarily arising
from its scale, will tend to be worse government. The first section defines
properties of bigness and government, and generic problems that may be a
consequence of scale. The second section considers in what ways big govern-
ment's claims on resources are a problem; the third section reviews potential
problems of big organizations. The programmes of government are ex-
amined in the fourth section, for we cannot make a global judgement about
government by looking at the summary indicators of aggregate size; we must
also understand the particular programmes that make it big. The conclusion
emphasizes the importance of distinguishing between problems of particular
policies (large or small) and problems of government in aggregate.
i. The problem defined
In order to evaluate big government, we must first of all disaggregate the
concept of government. Govemrnent is not a single undifferentiated 'black
box'; it involves a complex of diverse elements. What elements are big
when government is big? What grows when government grows? Figure i is a
simple model showing the relationship between the different elements that
government brings to bear in the policy process: the resources of revenue,
personnel and laws; organizations commanding these resources; and pro-
grammes to which resources are devoted. Organizations are the central
8 Richard Rose
element, mobilizing resource inputs and producing programme outputs.
This is in keeping with the conventional idea of government as a set of
institutions - albeit here the emphasis is upon the dynamic influence of
organizations.
Because the elements of government differ in kind, the size of government
cannot be reduced to a single indicator. The metric appropriate for measur-
ing organizations is not appropriate for measuring growth in laws or in
public revenues. Logically and empirically, government can show an 'un-
balanced, pattern of growth. For example, a government with a rapidly
growing population might increase personnel and revenue much faster than
it passed laws introducing new programmes. A government with a stultifying
bureaucracy might increase personnel without any
significant
increase in
programme outputs. Elements of government can change in opposite
directions. For example, a government demobilizing armed forces in a period
of detente might reduce personnel by eliminating conscription, while
revenues and expenditure increased because of expanded income mainten-
ance programmes.
FIGURE i. A simple model of government in the policy process
r Govewsment l
organizations
Principal
rexources: Programmes
Revenue
Personnel
Laws
CSomparing government growth
shows no
single pattern
of
change
in one
country,
or in one element of
government, cross-nationally.
Table I shows
that while both
public expenditure
and
public employment
have
grown
substantially since
I95I
in such disparate nations as Britain, Italy, Sweden
and the United States, the rates of growth have not been similar nor do the
differences suggest any obvious explanation. Already large and Socialist
Sweden and historically small and anti-Socialist Italy consistently show the
most rapid rates of growth. Public employment has grown twice as fast
in Italy as in the United States, and public expenditure in constant terms
grew four times faster in Italy than the United Kingdom. Britain, supposedly
suffering from chronic problems of 'too much government', and the United
States, where the welfare state is relatively weak, consistently show less
growth.
What if Anything is Wrong with Big Government?
9
TABLE I. The unbalanced nature of government growth since 195I
Public Public Public employment!
expenditure expenditure/GDP labour force
Growth rates, 1951 = I00
Britain 304 147 115
United States 364 133 I
13
Sweden 565 200 153
Italy 1,244 204 2I6
Notes and sources: Public expenditure and GDP growth rates I951-78 calculated in
constant prices; see Rose and Peters, Tables 2,
5 (forthcoming) Public employment data,
normally for 1951-76 period, calculated from Rose (I980), appendix table iC.
The scale of government is determined by the combination of particular
laws, revenue, personnel, organizations and programmes. The political case
for a particular policy is argued primarily in terms of the benefits (and costs)
specific to that programme. The total size of government is not the result of
a global governmental decision, but is produced by a bottom up aggregation
of specific programmes. Six policy areas usually account for the bulk of
public revenue and political concerns of Western nations today
-
income
maintenance, health, education, defence, industrial and economic policies,
and debt interest (Rose and Peters, 1978, 221ff). The programmes differ
from each other in the characteristics making them big. Income maintenance
and debt interest are money-intensive programmes, whereas health and
education are labour as well as money intensive. The causes of growth in
defence will not apply to welfare programmes, and opportunity costs may
cause rapid growth in one area, such as defence or welfare, to slow down
growth in the other. Any valid explanation of the scale of government must
therefore be multi-causal, because the direction, the extent and the rate of
growth can vary greatly between programmes.
Global measures of the size of government are by-products of decisions
taken by particular institutions of government about particular programmes.
In a federal system such as Germany or Canada, these decisions will involve
a multiplicity of governments with their own taxing, legislative and spending
powers. In fragmented systems of government, such as Italy and the United
States, there is not the central political authority to impose a target or ceiling
upon government's size. Macro-economists like to talk about the relationship
of public expenditure to the gross national product, but governors cannot
determine this ratio. It is arrived at after the fact, by tabulating records of
government and economic activity for the preceding year. Government
efforts to control or 'fine tune' the money supply, levels of public employ-
ment or total public expenditure may influence the direction of change, but
often miss their target by significant amounts. Politicians are more likely to
care about individual programmes than the cumulative sum of government
activities.
I0 Richard Rose
Measures of the absolute size of government are not particularly meaning-
ful, for size is first of all a function of population. The countries of the world
vary greatly in population: it is so skewed that I04 of 136 countries have less
than the mean population of
24
million; the median country in population
terms is Syria, with 5.3 million people (see Taylor & Hudson, I972, table
5.I). Among Western (that is, OECD) nations, population ranges from 22I
million in the United States to 220,000 people in Iceland. The absolute size
of government is also a function of total national wealth.
Historically,
absolute size has been considered a major national asset, whether viewed in
terms of military manpower or national economy (Knorr, 1956). Today,
large countries may, by virtue of their visibility, also be well placed to attract
international assistance, as Italy and Turkey have shown.
Among Western nations, the universe of analysis here, neither population
size nor gross national product per capita appears to be correlated with high
levels of political satisfaction - or lower levels of dissatisfaction. Anxieties
about 'governability' or 'ungovernability' appear to have no boundaries
(cf. Rose, I979, 35 If). Smaller countries are not necessarily better governed;
they just have fewer people to complain about government, and greater
chances of having their problems remain inconspicuous. For example, the
annual government deficit in public expenditure is equivalent to 8.3 per cent
of the national product in Sweden,
9.o per cent in the Netherlands, and
i0.5
per cent in Ireland (see OECD, I 980).
Rates of change are meaningful in any national setting; by definition,
growth makes government bigger, and most changes in government's size are
in a positive direction. But growth rates can have very different meaning,
depending upon whether they are applied to a relatively small government,
a government that is in the process of becoming big, or a government that is
already big and becoming bigger still. A given rate of growth has its biggest
relative impact when governent is smallest. At that time, doing anything
for the first time requires great ingenuity. The transition from a minimalist
nightwatchman state is potentially destabilizing, particularly if growth is
relatively rapid (cf. Olson, I963). For example, in Britain the four per cent
increase from i890 to I910 in public expenditure as a proportion of the
Gross National Product was a
5o
per cent increase relative to what it had
previously been (Veverka, I963, table i). By the beginning of the I960s, in
most Western nations government had already become big. Growth since
then is better understood as a process of government becoming bigger
-
or,
critics would say, becoming too big. Growth in government that has occurred
in the past two decades is relatively less. A four per cent change in the ratio
of public expenditure to the national product might reflect only transitory
fluctuations in political and economic conditions.
Evaluation of the size of government involves an implicit criterion: to say
that government is 'too big' or 'too small' is to imply that, like Goldilocks,
What if Anything is Wrong with Big Government? I I
we know the right size when we see it. Conventionally, the size of govern-
ment is measured in terms of a ratio of public expenditure to gross national
product (see e.g., Nutter, 1978; Musgrave, I978). Little attention has been
given to the meaning of this ratio scale, notwithstanding its patent faults.
So gross a ratio ignores the great potential variability in the composition of
public expenditure, or the fact that the same ratio can be produced by very
different absolute or per capita levels of public expenditure and the national
product. Moreover, since a substantial proportion of public expenditure
today consists of transfer payments, public expenditure could be well over
I 00 per cent of the national product.
Several economists have stipulated a 'threshold' value for the public
expenditure/gross national product ratio, that is, a line that should not be
crossed else government would be 'too big'. But Colin Clark's (I 945) warn-
ing about the perils of government claiming more than 25 per cent of the
national product for public expenditure was long ago crossed without
punishment. And no social scientific evidence is offered by Milton Friedman
(I976) to justify his dire warnings about what would happen if public
expenditure crossed the 6o per cent threshold.
Political scientists have concentrated far more attention upon studying the
causes of government growth rather than the consequences of big govern-
ment. (Cf. Larkey, Stolp and Winer, forthcoming) A great number of mono-
causal theories attempt to explain big government in terms of a single cause
of growth, or concentrate attention upon only a single dimension of govern-
ment growth, such as public expenditure. The result has been to unbalance
understanding. We know (or think we know) far more why government is
big than about what difference bigness makes in government. The principal
political science study of size in
government,
is inconclusive. Dahl and Tufte
(1974,
135) reply to the question
-
'Can we say, then, that there is any
optimum size for a political system?' - with the statement: 'Clearly no'.
Repeated attempts to define optimum size for cities, in terms of specific
quantitative indicators, have been inconclusive, 'because optimum size varies
according to service or function' (Newton, I978,
5;
see also, Fischer, I975).
Because analysis here concentrates upon governments in Western nations,
which have already become big by historical comparison, the question at
issue is: what problems are likely to arise when big government becomes
bigger still? No assumption is made about the growth of any one element
crossing a 'danger' threshold since the elements of government vary sub-
stantially in the likely consequences of growth. Whilst no threshold is postu-
lated, it would be wrong to assume that the benefits or costs of growth are
linear. Growth in an already big government can compound problems dis-
proportionately.
The consequences of big government growing bigger still are potentially
vast. Here, the consequences of growth are considered in relation to three
12 Richard Rose
generic concerns of government - achieving effectiveness; avoiding contra-
dictions; and maintaining popular consent. These are not the only effects of
the growth of government. They have been selected because each is of per-
vasive importance to the achievement of many public policies, and each
is,
on a priori grounds, likely to be specially
significant
in causing a government
bearing big responsibilities to become 'overloaded'.' The reasons why growth
threatens these attributes of political authority can be stated in generic
propositions.
(I) The growth of big
government will reduce
governmental effectiveness
insofar as growth is concentrated upon programmes lacking explicit
and tested means-ends technologies. The effectiveness of means-ends
technologies available to government varies greatly from programme
to programme. At one extreme, there are well tested 'hard' tech-
nologies, such as civil
engineering,
which provide the means for a
government to build roads or bridges with predictable effectiveness.
At the other extreme, there is an absence of agreed or effective
technologies for realizing such social goals as abolishing poverty or
abolishing crime. Between these two extremes, there are a number of
tested social technologies for achieving such goals as mass literacy, or
the reduction of peri-natal mortality. A government can be more
confident of building houses than building good citizens, of teaching
literacy than entreprenurial ability, and of promoting good physical
health in infants than good mental health in adults.
Government need not lose effectiveness as long as growth is confined
to already established programmes with tested means-ends technolo-
gies. If growth simply meant increasing the output of effective pro-
grammes, and there were no non-linear losses of effectiveness (cf.
Hood, 1976, 152ff) then the results need not be
unsatisfactory. But
there are positive political incentives for politicians to expand the
scope of government by introducing programmes to do things that
government has not done before. New programmes, by definition will
lead government to enter fields in which it has not yet demonstrated
effective competence. Established programmes may find that their
technologies become less effective or ineffective because of changes
in external conditions. A preliminary scanning of laws (see infra,
pp. 19-2 I indicates that their age is not yet a major problem. Greater
difficulties are likely to arise from contradictions between established
and new programmes, or between the initial objectives of a given
programme and new or additionally imposed objectives.
(2) The growth of big government will increase contradictions between
government programmes because of a disproportionate increase in the
interdependence of programmes. When government was relatively
What if Anything is Wrong with Big Government?
I3
small, programmes were few in number and objectives were relatively
simple. Government sought to influence relatively few cells of the
multi-dimensional matrix of social interaction, and many were un-
connected with others. The growth of government has been intensive
as well as extensive, that is, programmes multiply affecting a given
area of social life as education, health or the economy. When govern-
ment is big, this increases disproportionately the probability that a new
programme will affect and be affected by already established pro-
grammes. The growth of programme interdependencies within a
single policy area is well illustrated by the growth in the number and
variety of government's responsibilities for the economy and the inter-
actions between these programmes.
Contradictions are likely to increase with interactions, unless one
believes in a hidden hand mechanism that assures that each and every
new programme of government is dovetailed to fit with existing
policies. As the matrix of public policy becomes more densely packed
with programmes, then, as Wildavsky
(I979,
65) notes, 'Interdepen-
dence among policies increases faster than knowledge grows. For each
additional programme that interacts with every other, an exponential
increase in consequences follows'. Contradictions may be accepted by
governments as a political bargain necessary to satisfy conflicting
groups or contradictions may be the unintended result of unanticipated
spillovers, in which new programmes impact established programmes
in unanticipated ways. In such circumstances, a programme adopted
as a solution to one problem can create another by the contradictions
it occasions, a process of government growth that Wildavsky (I979,
ch. 3) has described as 'policy as its own cause'.
(3)
The growth of big government will threaten popular consent insofar
as it increases the perceived impropriety of government's actions. In
Western nations government cannot assume co-operation for any
policy it might choose to adopt. As well as a mixed economy, there is a
'mixed' society, that is, citizens in every Western society draw a
distinction between some things that are properly the sphere of govern-
ment action (e.g. the regulation of public health, or compulsory
education) and some things that are not (e.g., the expropriation of
property without compensation, or compulsory abortion in pursuit of
a population policy). By contrast, in a totalitarian state government
claims that all of society's concerns are subject to government action.
The contrast between what government deems proper to do in Eastern
and Western Europe today is a reminder of the importance in Western
nations of maintaining substantial areas of social life free from govern-
ment regulation.
When big government grows bigger still, it is more likely to verge into
14
Richard Rose
improper actions. Insofar as growth is extensive, involving government
entering a new policy area, then the very unfamiliarity of government
in that milieu can cause a negative reaction among those accus-
tomed to the status quo ante. The expansion of the scope of court-
regulated social activities in the wake of the 1954 US Supreme Court
anti-discrimination decision is an example of this process. Alterna-
tively, government may have an improper impact upon society as
the unintended consequence of pursuing new programmes; for ex-
ample, in the course of removing slums or building motorways, it may
unintentionally destroy self-sustaining communities and neighbour-
hoods.
The following pages review reasons why government becoming bigger
could be expected to reduce government effectiveness, increase contradic-
tions, and reduce consent by improper actions. An article cannot offer
conclusive evidence: the point is to focus attention upon problems that are
likely to arise from big government. Examples will be drawn primarily from
Britain and the United States, but generalizations should in principle be
more widely relevant. The focus is on the present, for by any historic stan-
dards, Western governments today are big - and in some respects show signs
of growing bigger still.2
2. The ambiguity of resources
Resources are an indicator of government claims upon society, but not
necessarily of government benefits to society. This is most obviously the case
in revenue-raising, for big government revenues mean big tax payments by
citizens, and taxes are normally considered a cost, not a benefit of govern-
ment. The employment of a large number of public officials will be immedi-
ately regarded as a benefit by those so engaged, but not necessarily by those
who work in the private sector. Laws can entitle citizens to receive benefits
of public policy, but laws can also obligate citizens to do what they don't
want to do or prohibit them doing what they do want to do. A resource-
oriented view of government is distorted, for politicians and citizens do not
think of government simply in terms of the resources it claims. Resources
can also be viewed as means to the end of producing programme outputs.
The resources that government mobilizes are in the first instance no more
and no less than inputs into activities of government organizations. (Figure I)
Every government organization depends upon a quantity of laws, public
employees, and allocations of revenue to maintain its activities. The bulk of
government policies involve the transformation of resources into physical
goods (military equipment, roads, electricity generating stations, etc.) or
services produced by government employees (e.g., health, education, social
work, etc.) Income maintenance programmes are exceptional in that their
What if Anything is Wrong with Big Government?
I5
output (cash payments) is in the same form as their principal resource (public
revenue).
In turn, programme outputs of government are but inputs into society.
Whether, how much and in what ways they affect social conditions are
empirical (and often disputable) issues, depending upon the circumstances of
the programme, the government and the society. For example, health ser-
vices do not assure that individual recipients are or become healthy; they
compete with extra-governmental determinants to influence individual
health. This is most obviously the case in psychiatric treatment. Similarly,
while education services have some influences on what young people learn,
schools are not the sole source of learning, nor are they all-powerful: family
and community can exert countervailing influences. Governments with big
resources provide more inputs to society than governments with few re-
sources, but this gross correlation does not justify treating resource inputs as
if they were identical to government outputs.
In analysing the consequences of big government, it is crucial to remain
conscious of the distinction between resource inputs and programme outputs.
Unfortunately, it is commonplace for politicians and policy analysts to treat
resource inputs as if they were programme outputs. Such an approach is
particularly misleading when considering government growing bigger still.
In today's circumstances, we are not, for example, concerned with whether
the abolition of compulsory education would make a difference, but with
marginal analysis: how much, if any, difference would it make to educa-
tional achievements to increase or decrease education spending or the
number of teachers or non-teaching staff in public education? The fact of the
matter is that we usually do not know what the marginal effect will be of
relatively small changes in resource inputs
-
up or down. Any statement
about the marginal utility of a specific quantum of government growth is
likely to have a significant error margin, or to be based on faith or explicit
political values.3
In revenue terms government is 'big business', for the sums collected by
government each year give it a bigger cash flow than any private sector
organization in the country. While nations differ in how they raise taxes
-
Italy and France, for example, rely more on indirect taxes and social security
levies than do America and Britain - all Western nations are big revenue
raisers. Conventional measures understate the cash flow resources of govern-
ment, for nationalized industries' revenues are reckoned as the net profit or
loss, and not in terms of gross trading revenue. Gross revenue for electricity,
gas, posts, telephones and other public utility services is a slack resource that
government can mobilize when hard pressed for funds, as the
I979
Con-
servative government has done, forcing nationalized industries to draw in-
vestment funds from current income rather than increase public sector
borrowing.
i6 Richard Rose
The growth of government revenue in the postwar era has had three
principal causes: inflation, real growth in national economies, and increasing
tax rates to yield government more money from a given volume of economic
activity. Of these three sources, inflation represents the greatest source of
growth, for inflation rates can be two to ten times annual growth rates.
In the I96os in the United Kingdom and in the United States, about half
the increase in current value public revenue was caused by inflation, and
about half came from economic growth. By contrast, in the
I97os, 87 per
cent of the increase in US federal revenue was due to inflation, and 93 per
cent in the United Kingdom (Rose, forthcoming, figure I). Whilst bigger
budget numbers do not ipso facto provide more public programme outputs
(cf. Beck, I976), they necessarily create bigger tax bills. Trebling taxes in
current money terms in the United Kingdom and doubling them in the
United States in about a decade may lead ordinary citizens to perceive a
widening gap between the costs and benefits of big government especially
when the constant value quantum of goods and services increases relatively
little.
As government grows big, by definition it must improve its technology for
collecting public revenue, in order to get the revenue necessary to meet the
increased costs of public policy. The pressures to improve revenue collection
have been felt in France and Italy, historically countries with relatively high
levels of tax evasion, as well as in countries where government has assumed
that citizens would comply with revenue raising measures. But as big govern-
ment grows bigger still, it can put at risk the marginal effectiveness of its
revenue-raising policies. The reason is simple: the more money that govern-
ment seeks in taxes, the greater the marginal incentive to citizens to avoid or
evade taxes. For example, if a marginal tax rate is one-third of earnings,
then tax avoidance or evasion promises a 50 per cent marginal increase in
effective earnings; where the marginal rate is 50 per cent or more, as in some
Scandinavian countries, avoidance promises a I00 per cent marginal in-
crease in earnings. There are good grounds to believe that tax avoidance and
evasion is increasing substantially as government revenue claims grow bigger
(see e.g., Gutmann, I977; Seldon, 1979a; Rose,
ig80a).
Big and growing public revenues can contradict other political goals in the
management of the economy. Increased government demands for revenue
can generate inflationary wage demands as these demands may increasingly
be advanced in terms of after-tax pay (McCracken et al., I977, ch.
5;
OECD, I978, 52ff). Moreover raising revenue for spending on final con-
sumption, whether by government or by recipients of government transfer
programmes, can reduce funds available for investment necessary to sustain
economic growth (cf. Geiger and Geiger, I978). The reduction of inflation,
the stimulation of economic growth and welfare policies are all valued goals
of Western governments - but these goals can involve contradictions. More-
What if Anything is Wrong with Big Government?
I 7
over, the prospects of making 'fine tuned' trade offs between them are
debatable given the uncertainties generated by complex international eco-
nomic interactions.
Big and growing government claims for revenue can create problems of
popular consent, insofar as they are perceived as making an 'improper'
claim on individual earnings. No impropriety - that is, no threat to indi-
vidual post-tax earnings - arose in funding welfare state programmes for
most of the postwar era; they were underwritten by the fiscal dividend of
growth. Post-tax earnings rose along with public revenues. A six per cent
increase in public revenues would leave substantial scope for an increase in
post-tax earnings. As long as it was levied on only one-quarter of a national
product growing at a three per cent rate, the growth in taxes would claim
only half the growth in GNP. But if government claims the equivalent of
half the national product for revenue, the same percentage increase would
force a reduction in take-home pay, if the growth rate of GNP dropped to
two per cent.4 In the past decade, the compounding growth in big govern-
ment's revenues and the slackening rate of growth in GNP has forced cuts in
post-tax income in every major Western nation, and cuts that appear to
reflect the culmination of long-term trends in Britain, Italy and Sweden.
This is not regarded as a 'proper' function of the mixed economy welfare
state by trade unions or employer groups and threatens to produce indiffer-
ence to government, and reduce the effectiveness of existing revenue-raising
technologies as well (see Rose and Peters, I978, chs. 7-8, and forthcoming).
The personnel resources of government are also big; government is every-
where the biggest employer in a country. The size of government is masked
by official figures on the civil service, for most public employees are not civil
servants: they work in local government, nationalized industries, or the
health service. In Britain and the United States, the officially denominated
civil service accounts for less than one-sixth of total public employment
(see Rose, I980). In aggregate, government employs 30 per cent of the
labour force in Britain, and I8.5 per cent of the labour force in the United
States. Public employees play a distinctive role in producing programme
outputs. In major social programmes such as
health,
education and social
services, their activities (that is, the provision of their skilled services) are the
programme outputs. Moreover, public employees are not passive partici-
pants in the policy process; they are also active agents influencing the scale
of public policies (cf. Niskanen, I97 I; Beer, 1976; Wright & Hebert,
I 980).
By contrast with public revenues, public employment has not grown con-
sistently in the post-war era (cf. tables I, 2). It has contracted in some nations
(e.g., Britain, from I 951 to i96i) and in some functions (e.g. public trans-
portation). Western nations show four different patterns of change in public
employment from I95I to 1976 (see table 2). Where public employment was
I8 Richard Rose
TABLE 2. Alternative paths of change in public employment, I951-76
Public employment: High growth Low growth
1951-76 1951-76
(public employment as % labour force)
Initially high Sweden Britain
(21% tO 31%) (26% to 30%)
Initially low Italy United States
(I0% to 22%) (i6% to I8%)
Source: Adapted from Rose, I980, table I.
relatively high, it continued to grow in Sweden but not in Britain. Where
public employment was initially low, it grew rapidly in Italy but not in the
United States. In effect, government has become less labour intensive as it
has grown bigger in revenue terms. This appears to reflect the growing
importance of cash transfer payments such as old age pensions.
The growth of government reduces effectiveness, because it tends to occur
in programme fields that involve less effective means-ends technologies. One
reason for this is that the fields with the 'hardest' technologies, such as the
generation of energy by public utilities, tend to be capital-intensive. Where
such industries are nationalized, then very larfge increases in output can
occur with limited increases in public employment (Rose, 1980, 76-8).
The greatest growth of public employment in major Western nations has
occurred in social programmes; they have increased their share of an en-
larged public employment by 28 per cent in the United States, and 23 per
cent in Britain. In the extreme case of Britain, without a growth of
i.9
million workers in health, education and social services, total public employ-
ment would have contracted from I95I to I976. In some social programmes,
there is a reasonably effective means-ends technology, but growth in social
policies has involved new programmes too, especially in social work, where
the technology for achieving identifiable (let alone agreed) outcomes is
weakest. Moreover, there appears to be a tendency for less skilled and pre-
sumptively less effective staff to increase more; within education non-teach-
ing staff increased more rapidly than teaching staff, and in health care, non-
medical staff increased more rapidly (cf. Rose, 1980, 76-8).
Insofar as Western governments see public employment as a means of
contributing to national economic growth, then there is a potential contra-
diction between the present pattern of public employment and economic
growth policies (cf. Bacon and Eltis, I976). The contradiction arises because
a substantial majority of public employees are not engaged in producing
marketed goods, but collective goods or welfare services that, although in
principle marketable, are given away. Public employees producing marketed
goods range from eight per cent of total public employment in the United
States to 2
1
per cent in Sweden, 36 per cent in Britain, and 38 per cent in
What if Anything is Wrong with Big Government?
ig
Italy (Rose, 1980, 46). By definition, there are fundamental problems of
valuing the output of goods and services not sold in the market place. In the
absence of any market mechanism to measure effective demand, supply may
determine the production of 'give away' goods (cf. Tarschys, 1975).
Even
though government may want to improve economic growth, it may itself be
reducing growth rates because of 'non market' or 'collective failures', includ-
ing goal substitution, excess costs, derived externalities and distributional
inequalities that can arise when government supplies goods and services
(Wolf, I 979; Peacock, I 980,
35ff).
The scale of public employment today poses a potential threat to popular
consent insofar as the benefits of public employees are perceived as improper
benefices by the great majority of the population who are not in the public
sector. Public employees enjoy several benefits that private sector employees
lack: their pensions can be inflation-proofed; their job security tends to be
greater; and their employer can use taxation to meet wage claims. Moreover,
public employees are normally more likely to be unionized than private
sector employees, and are strategically far better positioned to bargain for
higher wages. Given these factors, and the tendency of public employees to
be in jobs where productivity rises more slowly than in the private sector,
there is a relative price effect, that is, a tendency for public employees'
earnings to claim a growing proportion of the national product (cf. Baumol,
I967; Beck, 1976, 1979). While this effect may be ignored as long as it can
be covered by the fiscal dividend of growth, today private sector employees
may think it 'improper' that the total cost of providing the incomes of public
employees is increasing thanks in part to taxes paid by private sector em-
ployees, whose take home pay may fall in consequence. Increasing com-
plaints about public officials as a class and about taxation suggest a belief
that those who work for big government enjoy 'too much' or 'unfair'
advantages.
Because laws are a unique resource of government, there is no simple way
to measure their relative claims upon society's resources. Whereas govern-
ment claims less than half the national product and about one-quarter of its
labour force, it enacts I00 per cent of the laws of a society. To attempt to
assess what proportion of society's total activities are regulated by legislation
would presuppose a comprehensive accounting of society's activities. More-
over, laws are far less suitable to quantitative measurement than are the other
major resources of government. Whereas money is fungible and public
employees in the same grade will be paid the same, laws are not similarly
interchangeable. Because their qualities and meaning are nominal, laws
cannot easily be totalled up. Moreover, individual laws will vary greatly in
their impact. A single law on social security can claim far more public
revenue than a thousand 'average' acts, and a national health service will
make public employment grow far more than hundreds of other laws.
20 Richard Rose
Laws are continuing in their effect, unlike revenues and appropriations,
which must be renewed annually. Nearly all laws remain in effect sine die.
The difficulties of repealing laws are so numerous that this is rarely done
-
and unsuccessful efforts to promote 'sunset' legislation (that is, mandatory
expiral of programme authorizations) only emphasize this point. The con-
solidation or revision of legislation reflects a process best described as policy
succession not policy termination (Peters and Hogwood,
i980).
The statute
books of every Western nation reflect the cumulation of many decades of
legislation. Paradoxically, this means that the more voluminous existing
legislation is, the smaller the proportionate growth is likely to be in any one
year. Moreover, in Britain, the annual number of new Acts of Parliament
has declined by more than one-third from I90i-IO to the I970S (Butler and
Sloman, i980), and the number of new Statutory Instruments each year has
not increased greatly in volume since the late I940s. In the United States,
the number of bills and resolutions introduced into the House of Representa-
tives has more than doubled since I948, but the proportion reported to the
whole House has dropped fromn 25 to 6 per cent, and the number of bills
approved as Acts of Congress has fallen by half since i962 (ACIR, I980,
tables A-8, A-33). Federal regulations, however, have grown many times
from I 956 to I 975 (ACIR, I 980, table A- 1 2).
On a priori grounds, the cumulative growth in laws could reduce the
technological effectiveness of government. Insofar as statutes cumulated
from generations past, then laws enacted in earlier and very different social,
economic and administrative circumstances would presumptively be less
effective than newer legislation. In practice, this is not yet a great problem.
Notwithstanding the continuity of Parliament for seven centuries, the great
bulk of British statutes are relatively recent: two-thirds of Acts of Parliament
now in effect and more than four-fifths of all Statutory Instruments have
been enacted since the end of the Second World War (Parry, I979, table i).
A process of consolidation as well as innovation means that in some fields,
such as town and country planning, nearly all legislation in effect in England
dates since
I970 (Parry, I979, table 6). Older laws are often general statutes
conferring broad powers. The growth of legislation can involve consolida-
tion of acts, and, at least in the Westminster Parliament, additions to the
statute books are likely to be made by a government conscious of what is
already there.
As the number of laws grows, the chances increase for contradictions
between laws. This is a much greater risk in a federal system, such as the
United States, with a multiplicity of law-making bodies. It is also a greater
risk in the United States Congress, where laws can be passed or amended
piecemeal and ad hoc, by contrast with the Westminster Parliament, where
nearly all amendments are government measures accepted only after vetting
for the absence of inconsistencies with the principal objects of the bill
What if Anything is Wrong with Big Government?
2 I
(Herman, I972). Contradictions between the courts and the legislature are
also much more likely to arise in the United States, because the separation of
powers allows judges to pit their judgement against that of elected officials in
determining whether a measure is constitutional. Insofar as court cases are
indicators of conflict wsithin society, there is a substantial increase in suits in
both England and the United States in the past twenty years (ACIR, I 980,
tables A 9-I0; Central Statistical Office, I979, table I3.17). But violations
of laws or uncertainty about their application are not indicators of logical
contradictions between laws. Where contradictions arise, they are far more
likely to reflect substantive programme conflicts than procedural contra-
dictions (see section 4 below).
Because so many laws are of long standing, there is a presumption in
favour of popular acceptance of their propriety. When people know what the
law is and are habituated to accept it through the years, they are unlikely to
deny its legitimacy. New
legislation,
by definition, must be endorsed by a
majority of elected representatives, and opposition is often limited, or even
non-existent. A study of government legislation from I970 to 1979 in
Britain, nominally a period of adversary politics, found that the opposition
party did not vote against 78 per cent of all government legislation in the
second reading debate on its principle (Rose,
ig8ob,
8o-2). Criticisms of
government's laws and regulations are usually not directed to the propriety
of government action, but rather dispute the merits of substantive pro-
grammes. Where laws have often been flouted, such as legislation attempting
to regulate public morality, then governments are increasingly inclined to
respond by repealing them, an unusual example of the contraction of govern-
ment.
3. Sizing up organizations
In theory, the number of organizations involved in big government need not
be any different than the number involved in a small government. A govern-
ment could double the money spent on existing programmes, increase
personnel by half and enact new laws while the number of its organizations
remained constant. Insofar as public officials were enamoured of doctrines of
economy of scale, big government might lead to a net reduction in the
number of organizations, e.g. the consolidation of local government and
special purpose districts in the United States (Wright, 1978, io), and in
Britain, local government re-organization in the early I97os. The volume of
activities of government can increase, while the number of separately identi-
fied organizations remains constant or even contracts.
The great difficulty in applying the concept of size to government organ-
ization is in determining the unit of analysis. Constitutionally, government is
a single entity, or two levels in a federal system. But operationally, it is a
22 Richard Rose
multi-organization phenomenon, for each level of government is functionally
differentiated into a variety of departments. In turn, these departments are
further divided into bureaus,
sections,
and other variously denominated
operating units with specific programme responsibilities. The existence of
sub-departmental operating units is explicit in Washington, where bureaus
are recognized as independent political actors. In Whitehall, ministerial
responsibility limits their political autonomy, but sub-departmental divisions
are plain to see in the Civil Service Year Book, and reach extreme numbers
in the 'mini-Whitehall' clusters of the Northern Ireland, Scottish and Welsh
Offices. In such circumstances, the enumeration of general purpose and
special purpose units of government will give only the grossest of indicators
of scale. Enumerating central government departments without regard for
what is happening within departments may be actively misleading. For ex-
ample, the creation of 'superdepartments' in Whitehall in the early 1970S
did not signify a contraction in government (cf. Clarke, I97I, i; Sharpe,
1977, 54-6).
Complexity is central to the concept of organizational size. A big govern-
ment is organizationally a complex government. Complexity refers to the
degree of interdependence between relatively differentiated institutions
(cf. LaPorte, I975, 6), whether nominally under a single head (e.g. a Defence
Department differentiated between army, navy and air force) or separate
institutions (e.g. local authorities and central departments funding their
programmes). Organizational complexity is only partly a function of con-
stitution writing. It is also a function of the number and variety of pro-
grammes that a government undertakes. An increase in programme
functions will require differentiation within an organization (that is, the
creation of new functional divisions or bureaus) or else differentiation
between organizations.
In terms of means-ends technology, growth in the size (as distinct from
the programmes) of organizations does not of itself reduce effectiveness.
The biggest organizations within government are defence agencies and
welfare services. The militarv for centuries has had hierarchies of command
that permit growth through the multiplication and decentralization of units
without any loss of authority. Contemporary counterparts can be found in
education and health, for much growth in these programmes likewise in-
volves the multiplication of more-or-less standardized operating units
-
the
hospital, the doctor's office, the school or within it, the classroom. The policy
areas where growth of government has been greatest in the postwar era have
been areas where the organizational responsibility for delivering services can
be decanted into a large number of relatively familiar smallscale operating
units, and such 'pluralization' (Kochen and Deutsch, I980) is a relatively
effective form of expansion.
The growth of organizations does have a major impact upon inter-
What if Anything is Wrong with Big Government?
23
organizational relationships in ways that can threaten both effectiveness
and/or contradictions between organizations. As government multiplies the
number and size of organizations, the interdependencies between operating
units are likely to increase very greatly. When government has five major
organizations, the number of pairwise relationships is I0; when the organ-
izations increase to io, pairwise relationships increase to 45, and when the
number of organizations increases to 20, the number of potential pairwise
relationships is I90. Doubling the number of organizations can increase
inter-organizational interactions many times.5 In such circumstances, an
octopus becomes too simple a metaphor for government, since an octopus
has only eight arms and one head.
The growth of government has even bigger implications for interaction
between governmental and non-governmental organizations. In a society in
which ten per cent of organized activities were the responsibility of govern-
ment and
go
per cent the responsibility of the private sector then, if organ-
izational interactions were random, four-fifths of society's organized affairs
would involve interaction between private organizations, and only one-fifth
would involve government as one or both partners. But if the proportion of
society's organized activities that were the responsibility of government rose
to 30 per cent, then more than half of all organized interactions in society
would involve government as a partner.
Given the openness or 'vulnerability' of any government organization to
actions by another organization
-
whether at the same, superior or inferior
level of government
-
there is a disproportionate need to 'clear' actions
between organizations as government grows in order to avoid contradictions.
The process of clearance can be time-consuming in the extreme, as Pressman
and Wildavsky
(I973)
have shown in their study of implementing a new
programme in the American federal system. Even when a programme is
well established, an organization will need to invest substantial efforts to
maintain itself in a complex inter-organizational enviroment (see e.g. Hanf
& Scharpf, I978; Hood, I976; Rhodes, I980). In Britain, the growth of
Cabinet committees is an illustration of growing organizational complexity
at the top. In America, the characteristic complaint is of increasing com-
plexity in vertical relationships between as many as five different levels of
govemment (ACIR, I980, i6). At best, the
complexities of inter-organiza-
tional clearances may reduce efficiency slightly in order to avoid programme
contradictions. But
given
the scale of big government, even a relatively small
loss of efficiency can be substantial in absolute terms. At worst, the con-
tinuing jostling of different organizations, each concerned with aspects of the
same policy area, can so reduce efficiency that the result can be described as
'pluralistic stagnation' (Beer, I969, 407).
Contradiction is implicit in inter-organizational relationships, insofar
as each organization is an institution with its own needs and priorities
24 Richard Rose
(cf. Thompson, I967). In relationships between separate operating units of
government, the idea of national government, let alone the national interest,
begs the question: what is the 'nation' to which each operating unit owes its
primary loyalty? Government policy is an empty symbol when two units of
government are bargaining about what policy should be in matters affecting
them both. While broad
loyalties
to overarching party or civil service institu-
tions may facilitate a search for agreement, nonetheless different organiza-
tional 'missions' generate conflicting interests that are politically time-con-
suming or difficult to resolve. Inasmuch as growth in the size and number of
government organizations will also reflect an increase in government pro-
grammes, then government risks internalizing, within its own organizations,
all the contradictions within society. The overt articulation of conflicting or
contradictory demands can, as Newton notes (cf. 1978, 24f,-and Dahl &
Tufte, I974, 89) be valued as a positive contribution to making political
values explicit; where government is smaller, it may appear more consensual.
Moreover, where particular organizations within government have ties with
client groups outside government then, as Heclo (1978, 89) argues, there can
be 'a dissolving of organized politics, and a politicizing of organizational life
throughout the nation'.
Growth in the size and number of government organizations threatens
propriety insofar as the additional organizational layers increase political
distance between elected politicians and those they are meant to represent.
The number of top leadeis is always fixed at a few, while operating units of
government can multiply indefinitely. Insofar as top decision-makers are
remote and inaccessible, government might be expected to overstep more
often the bounds of propriety
-
if only in ignorance of what ordinary citizens
think and feel. Dahl and Tufte
(I974,
75ff) describe how an increase in the
scale of government gradually leads from 'asymmetric' communication, 'in
which citizens are treated as an audience' to conditions in which leadership
has become so remote and specialized that 'top leaders communicate with
one another through intermediaries, if at all'.
By definition, every government organization has propriety in the eyes of
some political groups; otherwise, it would have lacked sponsors within
government, and sufficient political support to gain establishment. But the
growth of government organizations can collectively increase citizen frustra-
tion, insofar as different organizations of government become enmeshed in
negotiating with each other, rather than directly responding to political
demands. What Grodzins (I966) once described as the 'multiple crack' of
federalism provides pressure groups with 'open access' to government in the
United States; in Whitehall too, departmentally oriented policy communities
sprout (cf. Richardson & Jordan, 1979; Hewitt, 1974). But more complex
organizations cannot so easily make collective decisions that cut across
organizational boundaries, or even package in one organization all the ser-
What if Anything is Wrong with Big Government?
25
vices a citizen may need. For example, a British firm wishing to establish a
factory in an area of high unemployment will have to negotiate with a
variety of central, local and 'off-line' government agencies and become (or
hire) an expert in inter-governmental relations in order to assemble the
appropriate package of permissions and benefits (see Hogwood, 1977). The
problem of co-ordinating government policy is far more difficult for the
unemployed worker or single parent entitled to categoric welfare benefits
from a host of government agencies, if he or she could but organize them.
When government is big, organizations are not so much criticized for
improper activities as they are for failing to achieve their proper activities,
whether because a narrow organiizational mission is blocked by uncoopera-
tive organizations elsewhere in government, or the organization is itself un-
willing to submerge its narrow mission to contribute to a broader govern-
mental objective. The multiple organizations of government become a maze
of interdependencies without a hierarchy of authority, a market involving an
exchange of influence or bargaining relationships between buyers and sellers,
each of whom has something to gain from the other in deals made without
collective electoral endorsement. Big government may still be able to deal
effectively with particulars of public policy, but it may be increasingly weak
in discharging its proper collective function of resolving inter-organizational
conflicts (cf. Lowi, I969; Heclo, 1978; Rose, I98oc).
4. Programme growth
Viewing government in terms of programmes puts the purposes of govern-
ment in the forefront. Programmes are legal and bureaucratic attempts to
translate general policy intentions into specific government actions. While
programme outputs should not be confused with programme impacts or
achievements, they are a systematic and purposeful way of identifying
government activities. Moreover, both governors and governed usually view
government as a set of organizations producing public policies to some
purpose.
Logically, government could grow without any increase in its pro-
grammes: growth could simply reflect the allocation of more and more
resources to existing programmes. At the other extreme, growth could result
exclusively from the adoption of new programmes. However, the empirical
distinction between established and new programmes is not clear-cut. There
are great grey areas best described as the expansion of existing programmes.
For example, education may expand by increasing the number of years
children are required to remain in school, or by increasing the proportion of
young people in tertiary education. 'New' programmes are usually not
created by parthenogenesis: their parentage and lineal descent is evident.
Often, new programmes are grafted onto established programmes or con-
26 Richard Rose
genes of programmes. In other words, there is not a clear-cut distinction
between 'more' programmes and 'bigger' programmes.
An OECD (1978, 26ff) study of public expenditure growth in major
welfare areas - education, income maintenance and health - since the early
I
960s
illustrates the importance of programme expansion. The largest
portion of increased expenditure was attributed to eligibility changes that
expanded programme coverage, making it possible for more people to claim
income maintenance grants in a greater variety of ways, for more youths
to get more education, and for a wider range of health benefits. Demo-
graphic expansion in the population made established programmes grow
bigger, requiring greater resources without any change in programme objec-
tives. To a noteworthy degree,
welfare programmes also grew bigger in terms
of resource costs, without any increase in programme outputs because of an
increase in the relative cost of established programmes. In short, the great
increase in the resource cost of welfare programmes reflects more than just
doing more of the same; it would be more accurate to speak of growth
arising more from the 'broadening' of welfare programmes than the creation
of major new programmes.
Every year government adds some new programmes by legislation.
(Rhetorical statements 'reshaping' the verbal justifications for established
programmes are likely to be of little effect and there are limits to the extent
to which resources can be reallocated without legislation.) The limited
impact of new legislative programmes upon the growth of an already big
government is indicated by an analysis of the public expenditure implica-
tions of new programmes in Britain in the I97os. From I970 to I974, the
Conservative government added i6 new spending headings to one hundred
or so programme headings into which the Treasury divides total public
expenditure. The average cost for these changes was
?9g
million by 1974;
in aggregate, they added 4.4 per cent to total public expenditure for 1973-4.
The 1974-9 Labour government added eight new programme objectives at
an average cost of about
?65mn.
and a total cost equal to o.8 per cent of
1978/79 public expenditure (see Rose,
ig80b,
I24). In other words, the
bigger the existing programme commitments, the less significant in overall
resource terms is the enactment of new programmes. Even if the bulk of
additional resources are devoted to expanding established programmes, the
bulk of government's political capital may be invested in new programmes
and new programmes can create a disproportionate amount of difficulties
for government because of their novelty.
The means-ends technologies of new programmes are, by definition, un-
tested. Broadly speaking, new programmes may involve extensive or inten-
sive growth. Growth is extensive if a new programme is in a field previously
not the subject of government action, for example, genetic engineering.
Growth is intensive if a new programme is within an area already covered by
What if Anything is Wrong with Big Government? 27
a number of public policies, for example adding categories of entitlement for
income maintenance.
At one time, government concentrated primarily upon activities for which
there were well known organizational technologies. The minimalist modern
state had only to maintain diplomatic and defence forces, courts and police.
Beyond this, its major programmes were likely to concern resource mobiliza-
tion through civil engineering projects, building bridges, roads and canals.
Millenia ago the Romans had developed appropriate technologies. Initially,
social policies also tended to involve relatively effective technologies, as in
public health or teaching primary literacy.
Contemporary governments find that most of the 'easy to do' things have
already been done. Yet political pressures for new programmes - within
government as well as externally
-
are not constrained by a prior need to
demonstrate an effective means-ends technology. In the I96os, expansion
was stimulated by the buoyancy of government revenue and, equally impor-
tant, a buoyant confidence that government could develop the technology to
do what it willed, such as win a war on poverty and a war in Vietnam
simultaneously. But the effectiveness of government will decline insofar as
new programmes have objectives beyond the means of government (or any
organization) to achieve. This is specially true insofar as the stimulus to
action in the American War on Poverty
- 'Faith and beliefs not research'
(Aaron, 1978, ix)
- is a common cause of forward leaps in government
growth.
The extensive growth of government programmes has been stimulated by
the logical insight that it is more desirable to treat causes rather than symp-
toms of social problems. This has involved the expansion and redefinition of
programme goals: it is no longer enough to apprehend and gaol criminals;
they should also be cured of their proclivities to crime. To ameliorate the
condition of poor people is inadequate; the causes of poverty should be
eradicated. Counter-cyclical economic policies intended to compensate for
frequent ups and downs in the economy should be replaced by 'balanced
growth'. Social services should not only act as a safety net for those with
social difficulties, but also remove these handicaps.
Treating the causes of social problems is well intentioned in theory, but
subject to two fatal flaws. It assumes that we know what the causes of social
problems are and that government has the knowledge, resources and political
will to treat these causes. Yet there is no requirement that knowledge march
hand in hand with intentions or desires. A government is not constrained to
enact programmes only where it is sure of being effective. Any innovative
programme
-
say, to combat juvenile crime where dozens of earlier pro-
grammes have previously failed - involves a disproportionate risk of in-
effectiveness. To obviate this, government may even substitute an objective
for which there is a known technology (e.g. the installation of computerized
28 Richard Rose
information systems for the police) in place of objectives that it does not
have the means-ends technology to achieve (e.g. the reduction of crime).
The extension of government programmes has given increased emphasis
to policies that are relatively unpredictable inputs to social processes. When
government concentrates upon what organizations can produce with a
known technology - building a new road or a new housing estate
-
final
outputs are predictable. But if the objective - for example, improving
transportation or building a 'good' community - is defined in terms of
second-order social consequences also influenced by a multiplicity of extra-
governmental factors, then the degree of effectiveness is contingent. Such
programme outputs become inputs to a process of interaction that govern-
ment can influence but not control. For example, the determinants of a good
community (however so vague an objective be defined) are multiple; the
houses, schools and other communal facilities built and maintained by
government have only an uncertain and limited effect. Good communities
reflect a host of influences, some directly controllable by government, some
identifiable by social scientists but not controllable by government, and some
determinants (the error term in statistical analysis) that are neither con-
trollable nor identifiable.
It is arguable that programmes involving new types of programme com-
mitment can provide the organizational base for government gradually
learning, from failure as much as success, how to deal with major problems of
society (see e.g. Sundquist, I970). Heclo
(I974,
ch. 6) describes the growth of
social policy in this century as a process of gradual social learning; in this
paradigm, failure or disagreement in the evaluation of outcomes is as fruitful
as perceived success. From a different political perspective, such as that of a
free market economist, the same process can be described as a progressive
debilitation of understanding through an increase in popular appetites for
benefits that, in the long run, cannot be sustained by society's resources
(cf. Brittan, I975; Buchanan & Wagner,
1977).
And Wildavsky describes
the increase in programmes as a process of increasing ignorance, as the
multiple consequences of programmes expand more rapidly than govern-
ment can learn what to do with them. Heclo too has noted this point:
'Well before generally accepted aims in one policy area are achieved, serious
difficulties are generated for the achievement of other, widely supported aims
in proximate policy areas... As policy effects accumulate and interact, the
explosion of costs becomes less important than the implosion of spillovers'
(Heclo, I975, quoted in Wildavsky,
1979,
66).
Insofar as new programme objectives are intensive impacting a policy
area which already has a number of established programmes, then there is an
increasing probability that actions taken to promote one programme will
contradict another. As the number of already established programmes grows,
the likelihood of contradictions increases disproportionately. Government
What if Anything is Wrong with Big Government? 29
bureaus responsible for particular programmes do not divert attention from
their primary objectives to speculate about second-order consequences for
other organizations, especially when these consequences are both numerous
and increasingly difficult to anticipate. Attempts in Washington to compel
this by mandating requirements for a multiplicity of impact statements - for
the
environment, inflation, urban problems, etc. - are prescriptions for in-
effectiveness. A programme that imposed no costs would probably be so
slight in its consequences as to involve little benefit as well. Only a naive
belief in a fundamental harmony of groups in society or in comprehensive
government planning preventing it from adopting non-contradictory objec-
tives could ensure that contradictions will not grow disproportionately as
programme objectives become more intensive in a given policy area.
The most familiar and persisting contradictions tend to arise between
economic and welfare objectives. Insofar as government wishes to promote
economic growth, then by definition it accepts continuing change in its
national economy, which must adapt to grow
-
or even to maintain pro-
ductivity in an increasingly open and competitive international economy.
But insofar as government regards unemployment or major inter-regional
movements of population as socially undesirable, then it may adopt pro-
grammes to sustain declining industries and declining regions. There is a
contradiction between economic investment and social policies. The former
involves 'too much' change at too high a social cost, and the latter threatens
'too little' change at too high an economic cost (cf. Olson, i968). At the
individual level, the contradiction is familiar in income maintenance pro-
grammes, which have the welfare objective of meeting the social needs of
families and the economic objective of maintaining the will to work. The
result can be a 'poverty trap', in which earnings of poor people are taxed at
higher marginal rates than the rich, and occasionally at more than ioo per
cent.
The growth of regulation in the United States has institutionalized con-
tradictions between procedural and substantive programmes. An agency
traditionally concerned with a substantive programme, such as building high-
ways or education, now finds itself part of a 'multi-mission' complex of
government programmes, with mandated procedures independent of its
programme mission. A substantive agency now finds itself subject to a host
of new federal laws concerning non-discrimination, environmental protection,
planning and project coordination, labour and procurement standards, and
access to government information and decision processes (ACIR, I980, 86).
Whilst each of these process objectives can be justified in itself, the cumula-
tive effect of mandating such process concerns on substantive agencies is the
institutionalization of conflicts about the primary purpose of a programme
for which an organization is responsible.
Contradictions between social preferences are not new. What the growth
30 Richard Rose
of government has done is to internalize these contradictions in government.
For example, the conflict between borrowers and lenders is of ancient origin.
What is new today is that government simultaneously wishes to protect the
value of currency by pursuing anti-inflationary policies, while simultaneously
wishing to bring about other benefits through pursuing inflationary or cheap
money policies. For a period in the I96os, the Phillips curve provided a
rationale for resolving these contradictions by a 'trade off', an economist's
term for political compromise. But the effectiveness of the trade off was
ended by the advent of stagnation. When conflicts involve zero sum issues of
protecting the environment as against allowing industrial expansion where
nationalized industries choose, then there can be zero sum contradictions
with government with each public agency advocating competing definitions
of the public interest (cf. Gregory, I 97 I).
The expansion of the programme objectives of government is intended to
increase popular satisfaction with government, but good intentions do not of
themselves guarantee the propriety of government actions. In a period when
big government threatens to consume 'too many' resources, government
programmes that fail to achieve their intentions may be deemed improper
because they waste public resources. More interesting is the possibility that
success creates a negative reaction. For example, the impact of US govern-
ment programmes mandating measures for safer automobiles may be
deemed to place an improper additional cost on consumers.
Systematic goal substitution by programme agencies can also generate
improprieties, insofar as intended beneficiaries of a government programme
perceive that other objectives have been substituted to their relative dis-
advantage. Charles Wolf has demonstrated that non-market public sector
organizations are subject to internalities or private goals, that is, operating
targets used in place of direct-performance indicators available in market
organizations (Wolf, I979, I 16). These producer-selected objectives may be
reasonable proxy measures for intended benefits, or even be dictated by
client groups rather than legislators. Alternatively, they may be determined
primarily for the benefit of the agencies themselves, e.g., maximizing staff
income and status or generating new technology or information for its own
sake. Many of Wolf's examples are cited from the military, where perfor-
mance is peculiarly difficult to evaluate in peacetime. But the War on
Poverty was also marked by allegations that the producers of anti-poverty
programmes were more interested in promoting their intemal organizational
goals than in substantive performance (see e.g., Pressman and Wildavsky
I973).
Big government
- and particularly, further growth in big government
-
threatens to breach the bounds of propriety of any 'mixed' society. By
definition, a portion of a mixed society's activities exclude government in-
volvement, just as another portion is deemed the proper responsibility of
What if Anything is Wrong with Big Government? 3 1
government. Looking backward, we can recognize a time when government
was too small to discharge the functions of the
contemporary
mixed economy
welfare state. There are no agreed prospective criteria to identify thresholds
that would mark govemment becoming 'too big', that is, exceeding what is
deemed its proper limits. Yet the bigger government becomes, the less
relevant are nostalgic concerns about the minimalist nightwatchman state.
At the same time, the more realistic are anxieties about big government
expanding into spheres properly outside its responsibilities in a mixed society.
Political values rather than arithmetic ratios are the determinants of what
constitutes 'too much government', and may depend on qualitative rather
than quantitative concerns, e.g. in a field such as population policy. The
programmes of a Western government can expand indefinitely -
but con-
tinuing growth implies an increasing risk of impropriety, or justification by
values more appropriate to authoritarian or totalitarian regimes than to
Western societies today.
Attempts to introduce or sustain government-mandated wage and price
programmes in the present turbulent economic climate show how the limits
of political propriety force Western governments to restrict the scope of
programmes, sacrificing hopes of effectiveness to maintain consent by staying
within the bounds of propriety. The nominal objectives of wages and prices
policies may be broadly acceptable in contemporary mixed economies. But
the means necessary to maintain such policies indefinitely can involve 'too
much' or 'improper' government interference with the rights of free trade
unions to bargain for wages and/or with the rights of businesses to determine
prices and profits. Voluntary controls are likely to be regarded as acceptable
because they do not extend government's power improperly into what is
regarded as the private sector of the economy. But voluntary measures may
be ineffective just because they do not have the force of law behind them.
Normative problems about how far a Western government may properly
intervene in the market impose practical limits upon government effective-
ness (see e.g. Goodwin,
i975;
McCarthy, 1978; Schwerin, I980).
5. The particulars and the sum effect
Big government is here to stay. Like it or not, no conceivable elected govern-
ment is going to pursue policies leading to the repeal of social welfare,
economic and defence programmes that collectively produce government on
the scale that we know today. Critics of the shortcomings of big government
see reasons why the growth of government should continue, because of
dynamic forces within government, making it easier for government to
expand, if only to correct its previous failures (cf. Wildavsky, I979).
Proponents of the programmes of big government fear that evidence of
failure to realize expectations of the Kennedy-Johnson or Wilson-Heath
32 Richard Rose
years may dampen enthusiasm for new government programmes (Aaron,
1978, 152ff). Whichever group temporarily holds the dominant political
position in society, government is sure to remain big, whether judged by
historical standards or by the size of other organizations in society.
Contemporary governors face the immediate problem of coping with the
problems of already big government. These problems are both general and
particular. They are particular, inasmuch as government is organizationally
differentiated into many different operating agencies, each with particular
programme concerns and claims upon resources. They are general, insofar
as the sum of particular programmes generates the big total claim upon
society's resources, and at present, governments are nervous about whether
they can or should sustain such claims on resources.
Any attempt to draw up a balance sheet about contemporary big govern-
ment faces a dialectical difficulty in relating judgements about the whole and
the parts. A recurring dilemma in political discusions of the size of govern-
ment is the reconcilation of global resource constraints and the attractions of
giving specific programme benefits. The ideal of most politicians, when
presented with pressures to spe.nd more in particular and less in general, is to
restrain resource claims in general without cutting particular programme
outputs. The favourite strategy for thus resolving the dilemma is to seek the
elimination of inefficient or ineffective programmes, in order to have more
resources for effective and efficient programmes. Unfortunately, readily
cutable programmes are not easily or consensually identified. By definition,
big programmes have big clienteles ready to support them - the elderly,
young people, parents, public employee unions and so forth. Nor is waste
easy to identify or eliminate. If it were, it would have been disposed of long
ago. The failures of the Nixon, Heath and Carter administrations to save
money by reorganizing government are symptomatic of the contrast in
government between managerial good intentions and political realities.
The favourite strategy for expanding government painlessly is to assume
that growth will not only add to the sum total of human happiness, but also
create additional societal resources, thus leaving unaltered government's
proportionate claim upon the nation's total resources. For example, measures
intended to stimulate full employment may be justified by relating the
immediate increase in money and personnel costs to the anticipated growth
in national employment, national income and subsequent government
revenue. But one consequence of the growth of government is that time
horizons become foreshortened. For example, pump-priming government
deficits have grown so great that the short-term financing of past deficits can
be an immediate and pressing anxiety of government.
Whatever political perspective is
adopted, the chief problems of size facing
government today are marginal, whether these are questions about marginal
growth, marginal contraction, or a relative reduction in rates of growth by
What if Anything is Wrong with Big Government? 33
comparison with the previous two decades. To say this does not reduce the
difficulties of governing, for preceding sections have shown why the problems
of growing bigger are greater than the problems of remaining big. And the
problems of 'cutbacks', even if only marginal, are great too (cf. Levine,
1978).
If government is to continue to grow, it could do so in a variety of distinc-
tive ways, such as increasing programme outputs at no noticeable resource
costs; increasing resources at no noticeable increase in programme outputs;
and by making organizational changes more or less irrelevant to programme
outputs or resource claims. In the cut and thrust of government, most
changes are in fact debated in terms of programme alternatives. When the
pressures upon government resources are great, the opportunity cost of
growth is specially high. It follows from the preceding analysis that growth
is most likely to have a positive result in cost-benefit terms, insofar as it
involves the expansion of well established programmes. In such circum-
stances, effectiveness is known, new activities are not created that risk con-
tradictions with other programmes or disputes about the propriety of
government action. By contrast, growth is most likely to have negative effects
when it involves launching new programmes, for these will have untested
means-ends technologies, risk contradictioons insofar as they occur in inten-
sively serviced policy areas or risk dispute about propriety by entering policy
areas previously outwith the concern of government.
The bigger government becomes, the more difficult it is to make a judge-
ment about government independent of a judgement about society as a
whole. When government is big, then most everyday actions of citizens
directly or indirectly affect what it does, and vice versa. For example, state-
ments about the success or failure of a government to promote economic
growth are as much a statement about the social system as they are about the
political economy (cf. Beckerman, 1979). Just as we cannot expect the
government of a poor Third World country to transcend its national limita-
tions, so we cannot expect a big Western government to be more successful
than its society today.
NOTES
I For a fuller discussion of the importance of effectiveness and consent as crucial analytic
foci in discussions of 'overloaded' government, see Rose (I979).
2 The Second World (that is, the so-called Socialist states of Eastern Europe, and particu-
larly the Soviet Union) provide examples of the pathologies of bigness of different cause
and magnitude than any Western nation offers (see e.g. Nove, I977).
3 The inability to relate expenditure inputs to programme outputs does not, however,
stop economists from attempting to produce such measures of marginal change as
elasticity indices of public expenditure to economic growth (see e.g., OECD, 1978).
Useful as such measures may be for some purposes, they are not evidence of marginal
benefits.
34 Richard Rose
4 The arithmetic is simple: a 6 per cent increase in public revenue when that is 25 per
cent of GNP. When public revenue is 50 per cent of GNP, a 6 per cent increase in
public expenditure is equivalent to 3 per cent of GNP. In the former case, any growth
rate larger than
I.5
per cent will provide a 'fiscal dividend' big enough to increase take-
home pay as well as public revenues. In the latter case, a national growth rate of less
than 3 per cent will force a cut in take-home pay.
5 The formula is: n(n- )
2
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