Chapter 15: The Bureaucracy Honors Classes, November 20, 2013

1. Chapter 15: The BureaucracyHonors Classes, November 20, 2013

2. What’s a bureaucrat? • Class exercise: first impressions. • Stereotype: “I’ll answer your phone call when they pry my coffee cup from my cold dead hand.”

3. Why Study the Bureaucracy? • Because it has a BOATLOAD of power! • Statutes get implemented through regulations. Bureaucrats write and apply the regs. • Remembering specific names of all the agencies is not the goal here. • Rather, we’re focused on trying to understand the general structure of the bureaucracy along with the causes and implications of bureaucratic behavior.

5. What is a bureaucracy? A bureaucracy: • Just one model for how an organization can be set up. • Take any large group of people and organize them into (hopefully) productive tasks. • Examples: the military, Wal-Mart, McDonalds, even good ol’ Mc-T. The bureaucracy: • Usually refers to the government, and even more specifically, the Executive Branch of the federal government. • For purposes of this class, that’s what we’ll mean.

6. There are lots of agencies in the federal gov’t • See http://www.usa.gov/directory/federal/index.shtml

7. “A” bureaucracy’s characteristics Any bureaucracy is likely to have the following characteristics: • Hierarchy. Maybe like this one:

8. A bureaucracy (cont.) • Division of labor/specialization. • Each one of those boxes has a job to do. • Makes coordination really hard. • Often waaaay too many people get involved in a project.

9. A bureaucracy (cont.) Lots of SOPs – standard operating procedures. • These are the way things need to be done. • Agencies will have binders full of things that look like this:

10. Some pros and cons of gov’t bureaucracies Pros: • In theory, all that specialization and those SOPs can lead to more efficient decision-making. • Career employees can lead to more objective outcomes. • There actually can be (and is) creativity when people work in a group setting. Cons: • Efficient decision-making?! Are you kidding me? • Work expands to fill the time (Parkinson’s “Law”). • Much less accountability. • Not the same incentives as in the private sector. • REALLY hard to fire someone. Can result in “dead wood.”

11. Could happen…

12. The big picture of the Exec Branch

13. Big picture unpacked There’s the Executive Office of the President (“EOP”) • The President’s closest advisors. The “West Wing” folks. Why “West Wing”? Because they work in the West Wing of the White House.

14. Executive Office of the President (EOP) • A bit of trivia for you: Until 1857, the President paid for his staff out of his own pocket. • The EOP was established in 1939 but it gets reorganized with every president. • Some major actors in the EOP: • National Security Council • Office of Management and Budget • Council of Economic Advisors

15. Office of Management and Budget (OMB) • Hugely influential. • Prepares the budget that President submits to Congress. • Federal agencies will submit their budget requests to OMB, who will decide whether to include that in the President’s budget. • Oversees how funds are spent. • Conducts “cost-benefit” analyses of proposed regulations.

16. Cabinet Departments There are 15 Cabinet Departments (also known as the Executive Departments). • A picture of Obama’s original cabinet: • Trivia: 1 out of 14 is not a “Secretary.” Who? The AG.

17. Structure (cont.) • Cabinet secretaries have broad missions and often a political focus. • They: • Are appointed by President and confirmed by Senate. • Have short tenure. • Have high profile. • Criteria: • Usually from the President’s party. • Often were political supporters. • Diversity often a factor. • Usually quite competent.

18. The current cabinet

19. Cabinet (cont.) • The president has the last word, regardless of what cabinet Secretaries tell him. • Famous story about Lincoln and the Emancipation Proclamation: • After all 7 of his cabinet Secretaries voted “nay,” Abe said “Seven nays, one aye, the ayes have it.”

20. Independent regulatory commissions • Some examples: the Fed, SEC, and FTC • They typically protect some portion of the economy. • They resolve disputes. They have have enforcement authority. They can punish people. • Heads appointed by President, confirmed by Senate. Fixed terms, usually staggered. Theoretically less political.

21. Independent agencies • Independent agencies (not to be confused with independent commissions) have -- • Smaller, more focused mission • Leadership appointed by President and confirmed by Senate, but they are not part of the Cabinet. Longer tenure, less political. • No enforcement authority. • Examples: NASA, National Science Foundation.

22. Government corporations • Examples: Amtrak and Postal Service • Why are they formed? • Good question. (Thanks.) In theory they have the nimbleness of a private-sector corporation while doing something that people want the government to do.

23. Possible problems with bureaucracies • Lack of resources. • Take banking as an example. • The largest banks will have 100,000 employees and over $1 trillion in assets. • They will be examined by maybe 100 bank examiners.

24. Possible problems (cont.) • Discretion is exercised at all levels of an agency. • The heads can “slow walk” a direction from the President. Ex: Geithner and dissolving Citigroup. • “Street-level bureaucrats” (i.e., government employees who have a lot of direct contact with people) also have to exercise discretion.

25. Possible problems (cont.) Regulatory capture • When an agency becomes dominated by the industry that it is supposed to regulate. • Why does it happen? • Human nature/play nice • Mismatch of resources • Need support of industry • Desire not to make waves • Etc.

26. So Why Delegate So Much Power? • Given all these potential pitfalls, why does Congress delegate so much power to the agencies? • Three main reasons: • Congress lacks the expertise • Congress lacks the time • Congress wants to avoid blame

27. How is the bureaucracy kept in line? First, through Congress’scontrol of the money. • Never underestimate the “power of the purse.”

28. Herding cats: Congress (cont.) Three other big powers: • The Senate gets to confirm (or not) nominees for the heads of the agencies. Gets to shape direction of agency (sort of). • Congress can always amend an agency’s power through legislation. • And, as we saw when studying Congress, nothing focuses the attention like a good oversight hearing. Ex: http://www.youtube.com/watch?v=TC0AKNQBV80 (Sec’y Clinton Benghazi hearing)

29. What can the President do? • Reorganizeentire agencies. Ex: DHS. • Issue Executive Orders. • Alter an agency’s budget (although Congress is the final say). The President, through OMB, can whittle away at a proposed budget.

30. Civil Service Then: • TJ fired a lot of federalists; political party was important to getting and keeping a job. • Andrew Jackson took this a step further by using the “spoils system.” Now: • Pendleton Act: Can’t hire or fire for political reasons. Civil service jobs are to be awarded based on merit. • Hatch Act: Federal workers can’t campaign while at work or run for office.

31. Civil Service (cont.) • People get their federal jobs now through a competition. • Hiring and firing is done on merit. • Office of Personnel Management will send top 3 names to the agency seeking to fill a vacancy. Your reward for making it this far: another random (but amazing) animal photo: (see next slide)