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 . Accessed: 06/12/2011 11:43 Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at . http://www.jstor.org/page/info/about/policies/terms.jsp JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@jstor.org. Cambridge University Press is collaborating with JSTOR to digitize, preserve and extend access to Journal of Public Policy. http://www.jstor.org 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. 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