what if anything is wrong with big government

8/12/2019 What if Anything is Wrong With Big Government

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What if Anythingis WrongwithBig Government?*RICHARD ROSE Centrefor theStudyof PublicPolicy,Universityof Strathclyde

ABSTRACTStarting without any a priori assumptionthat government s necessarilyaforce for good or ill, this articleexamineswhat negative consequencesarelikely to arise from big government- or governmentgrowing bigger still.Three generic effects are postulated:a loss of effectiveness,because of theuse of weakermeans-endsprogramme echnologies or new programmes;anincreasein contradictionsbetweenexisting,growingand new programmes;and a possiblereductionof consent, insofar as growth increasesthe 'im-propriety'of governmentactions.The growthof government s shownto be'unbalanced', hat is, to occurin incommensurablewaysand at varyingratesfor majorresources government evenue,personnel,and laws); governmentorganizations;and programmeoutputs.The differentcharacterof growthineach element is examined, and particularconsequenceshypothesizedforresourceelementssingly,for internalcharacteristics f organizations,and fortheir combinationin programmes.The analysissuggeststhat while muchgrowthinvolves no intrinsicproblemsof size (as long as economicresourcesare availableto meet the costs),there is likelyto be disproportionateoss ofeffectiveness, and increasing contradictionsbetween programmesif biggovernmentgrowsbiggerstill.

IntroductionGovernment s big in itself, in its claimsupon society'sresources,and in itsintended impact upon society. Equally important,governmentis dynamicnot static: recurringly t grows bigger still. Criticsargue that its activitiesshouldbe limitedso that it becomeslessbig, or even contractsto the smallscale of an earlierera. By almost any conventionalindicator, government* This paper is an outgrowth of a continuing seminar on the Growth of Government atthe Centre for the Study of Public Policy. I am indebted to its members for theexploration of ideas, and particularly to Richard Parry for research on the growth ofgovernment in the United Kingdom since 1945. In addition, I would like to acknow-ledge useful critical comments on drafts of this manuscript received from BrianHogwood, Johan Olsen, Edward C. Page, B. Guy Peters and Aaron Wildavsky.


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6 RichardRose- whether viewed as a single institution or a complex of organizationsdominatesmuch in every Westernnation; the chief differencefrom nationto nationis the degreeof its bigness.Historically, the growth of government to its present size representsagreattriumphfor the modernstate. When the prototypical nstitutionsof themodem state were evolving n the nineteenthcentury,government's ctivitieswere relatively few (Rose, I976). Even though the present scale of publicpolicieswas not anticipated n the constitutions f modernstates,governmentinstitutionshave become able to provide the services of the contemporarymixed economywelfare state. To arguein favourof 'smallis beautiful' is toprescribean anachronistic r Utopian response o the fact of bigness n con-temporarysocieties.The conditionsthat have brought about the growthofgovernment are not easily reversible.And other institutions in society -businesscorporations, rade unions and universities have grown big too.The immediate issue is not whether governmentshould be big, but whatsignificance o attribute o itspresentobserved ize.Politiciansusually praiseor denouncebig governmenton a priorigrounds.Becausethe growth of governmenthas occurredapproximately n parallelwith the expansionof the franchise,big governmentcan be praisedas a con-sequenceof individuals earning o co-operate o providecollectively ortheirneeds and to mobilizefor effective action againsttraditionallyentrenchedruling groups. The proximatecause of big government,the provision ofeducation,health and incomemaintenancegrants, s welcomedbecausethesewelfare benefitsare regardedas 'good' goods. A review of public opinionabout the welfarestate in Westernnationsconcludes: 'Active governmentinvolvement in providinga basic level of economic and social well-beingfor the citizenry is everywhere a matter of majority public acceptance'(Coughlin, I980, 25). The reason for the popularityof major governmentpoliciesis easy to see: they providemajorbenefits or nearly every family insociety(Roseand Peters,I978, 256-59).Conversely, riticsof big governmentoften arguefrom normativegroundsthat it is improper for government to expand beyond the minimalistmeasuresof the nightwatchmanstate. For example,Seldon (I979, 7i) hascalculatedthat two-thirdsof publicexpenditureby Britishgovernment ouldbe eliminated,if governmentwere to confine its activitiesto the 'necessaryevil' of providing public goods. Marxists have agreedwith marketecono-mists that big government s pathological: hey see it as a signof the comingcollapseof a businesssystemthat uses governmentmeasures o compensatefor its weakness(O'Connor,1973).In reality,the great bulk of the polemicsaboutbig government s aboutgovernmentper se, and not about the size of government.If governmentactionsare thoughtto be intrinsicallygood, then the morethat governmentdoes, the bettersocietywill be. If government s thoughtto be a bad thing,


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Whatif Anythingis WrongwithBig Government? 7as market-orientedcritics argue, then the bigger that government is, theworse will be its effects upon society. The virtuesor faults of governmentarenot a function of scale; they are assumed to be intrinsic to the nature ofgovernment.Moreover, many of the major problems facing societies today are notrelated to the size of government.The significanceof an issue depends uponthe intensityof its effect, as well as upon the numbersaffected. For example,capital punishment can be an issue of intense concern, albeit the numbersimmediately affected are small. Many issues are importantbecause of theirpervasive impact upon the authority of government. This is true of thechallenge to the authority of the United Kingdom presentedby three percent of its population in Northern Ireland today. In the United States,Watergate involved only a handful of people, yet it greatly affectedAmericans'confidence n government.The seizing of 52 American hostagesin Iran in I979 challengedthe authority of the United States even thoughthe hostageswere a trivial proportionof Americansabroador at home.The purpose of this article is to consider whether there is necessarilyanything wrong with big government.It startswithout any a priori assump-tion that governmentis necessarilya force for good or ill. The primaryassumptionis that big government s differentfrom the minimalistnight-watchman state. This article explores what logical and empirical groundsthere are for believingthat big government,for reasonsnecessarilyarisingfrom its scale, will tend to be worse government. The first section definespropertiesof bignessand government,and generic problemsthat may be aconsequenceof scale. The secondsectionconsidersn what ways big govern-ment's claimson resourcesare a problem;the thirdsection reviewspotentialproblems of big organizations.The programmesof government are ex-aminedin the fourthsection,for we cannotmakea global judgementaboutgovernmentby lookingat the summary ndicatorsof aggregatesize; we mustalso understand he particularprogrammeshat makeit big. The conclusionemphasizes he importanceof distinguishingbetweenproblemsof particularpolicies (largeorsmall)and problemsof governmentn aggregate.

i. The problemdefinedIn order to evaluate big government,we must firstof all disaggregate heconcept of government.Govemrnent s not a singleundifferentiated blackbox'; it involves a complex of diverse elements. What elements are bigwhen government s big?What growswhengovernmentgrows?Figure i is asimple model showing the relationshipbetween the differentelements thatgovernment bringsto bear in the policy process:the resourcesof revenue,personneland laws; organizationscommandingthese resources;and pro-grammes to which resourcesare devoted. Organizationsare the central


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8 RichardRoseelement, mobilizing resource inputs and producing programme outputs.This is in keeping with the conventional idea of government as a set ofinstitutions - albeit here the emphasis is upon the dynamic influence oforganizations.

Because the elements of government differ in kind, the size of governmentcannot be reduced to a single indicator. The metric appropriate for measur-ing organizations is not appropriate for measuring growth in laws or inpublic revenues. Logically and empirically, government can show an 'un-balanced, pattern of growth. For example, a government with a rapidlygrowing population might increase personnel and revenue much faster thanit passed laws introducing new programmes. A government with a stultifyingbureaucracy might increase personnel without any significant increase inprogramme outputs. Elements of government can change in oppositedirections. For example, a government demobilizing armed forces in a periodof detente might reduce personnel by eliminating conscription, whilerevenues and expenditure increased because of expanded income mainten-ance programmes.FIGURE i. A simplemodel of government n the policyprocess

r Govewsment lorganizations

Principal exources: ProgrammesRevenuePersonnelLaws

CSomparingovernmentgrowthshows no single patternof changein onecountry,or in one element of government,cross-nationally.Table I showsthat while both public expenditureand public employmenthave grownsubstantially since I95I in such disparate nations as Britain, Italy, Swedenand the United States, the rates of growth have not been similar nor do thedifferences suggest any obvious explanation. Already large and SocialistSweden and historically small and anti-Socialist Italy consistently show themost rapid rates of growth. Public employment has grown twice as fastin Italy as in the United States, and public expenditure in constant termsgrew four times faster in Italy than the United Kingdom. Britain, supposedlysuffering from chronic problems of 'too much government', and the UnitedStates, where the welfare state is relatively weak, consistently show lessgrowth.


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What if Anything s WrongwithBig Government? 9TABLE I. The unbalancednatureof governmentgrowth since 195I

Public Public Public employmentexpenditure expenditure/GDP labour forceGrowth rates, 1951 = I00

Britain 304 147 115United States 364 133 I 13Sweden 565 200 153Italy 1,244 204 2I6Notes and sources: Public expenditure and GDP growth rates I951-78 calculated inconstant 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 s determinedby the combinationof particularlaws, revenue,personnel,organizationsand programmes.The political casefor a particularpolicyis arguedprimarily n termsof the benefits(and costs)specific to that programme.The total sizeof government s not the result ofa globalgovernmentaldecision,but is producedby a bottomup aggregationof specific programmes.Six policy areas usually account for the bulk ofpublic revenue and political concerns of Westernnations today - incomemaintenance,health, education, defence, industrialand economic policies,and debt interest (Rose and Peters, 1978, 221ff). The programmesdifferfromeach otherin the characteristicsmaking thembig. Incomemaintenanceand debt interest are money-intensiveprogrammes, whereas health andeducation are labour as well as money intensive. The causes of growth indefence will not apply to welfareprogrammes,and opportunitycosts maycause rapid growth in one area, such as defence or welfare, to slow downgrowthin the other. Any valid explanationof the scaleof governmentmusttherefore be multi-causal,because the direction,the extent and the rate ofgrowthcan vary greatlybetweenprogrammes.Global measuresof the size of governmentare by-productsof decisionstaken by particularnstitutionsof governmentaboutparticularprogrammes.In a federalsystemsuch as Germanyor Canada,thesedecisionswill involvea multiplicityof governmentswith theirown taxing, legislativeand spendingpowers.In fragmentedsystemsof government, uch as Italy and the UnitedStates,thereis not the centralpoliticalauthority o imposea targetor ceilingupon government's ize. Macro-economistsike to talkaboutthe relationshipof public expenditureto the grossnational product, but governorscannotdeterminethis ratio. It is arrivedat after the fact, by tabulatingrecordsofgovernment and economic activity for the preceding year. Governmenteffortsto controlor 'fine tune' the money supply, levels of public employ-ment or total publicexpendituremay influence the directionof change,butoften miss their target by significantamounts.Politiciansare more likely tocare about individualprogrammes han the cumulative sum of governmentactivities.


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I0 RichardRoseMeasuresof the absolutesize of governmentare not particularlymeaning-ful, for size is firstof all a function of population.The countriesof the worldvarygreatly n population: t is so skewedthat I04 of 136 countrieshave lessthan the mean populationof 24 million; the mediancountryin populationterms is Syria, with 5.3 millionpeople (see Taylor & Hudson, I972, table

5.I). Among Western(that is, OECD) nations,populationrangesfrom 22Imillion in the United States to 220,000 peoplein Iceland.The absolutesizeof government is also a function of total national wealth. Historically,absolute size has been considereda majornationalasset,whetherviewed interms of military manpoweror national economy (Knorr, 1956). Today,largecountriesmay, by virtueof theirvisibility,alsobe well placed to attractinternationalassistance, s Italy andTurkeyhaveshown.Among Westernnations,the universeof analysishere,neitherpopulationsize nor grossnationalproductper capita appears o be correlatedwith highlevels of political satisfaction or lower levels of dissatisfaction.Anxietiesabout 'governability'or 'ungovernability'appear to have no boundaries(cf. Rose, I979, 35 If). Smallercountriesarenotnecessarilybettergoverned;they just have fewer people to complain about government, and greaterchances of having their problemsremaininconspicuous.For example, theannualgovernmentdeficit n publicexpenditures equivalent o 8.3 percentof the nationalproduct n Sweden,9.o percent in the Netherlands,and i0.5per cent in Ireland(seeOECD, I980).Rates of change are meaningfulin any national setting; by definition,growthmakesgovernmentbigger,andmostchanges n government's ize arein a positive direction.But growth rates can have very differentmeaning,depending upon whetherthey are appliedto a relativelysmallgovernment,a government hat is in the processof becomingbig, or a government hat isalready big and becomingbiggerstill. A given rate of growthhas its biggestrelativeimpact when governent is smallest.At that time, doing anythingfor the firsttime requiresgreatingenuity.The transition rom a minimalistnightwatchmanstate is potentiallydestabilizing,particularly f growth isrelativelyrapid (cf. Olson, I963). For example,in Britainthe four per centincreasefrom i890 to I910 in public expenditureas a proportionof theGrossNational Product was a 5o per cent increaserelative to what it hadpreviouslybeen (Veverka,I963, table i). By the beginningof the I960s, inmost Western nations government had already become big. Growth sincethen is betterunderstoodas a processof governmentbecoming bigger- or,criticswouldsay,becoming oo big. Growth n government hat hasoccurredin the past two decades s relatively ess. A four per cent changein the ratioof public expenditureto the national productmight reflectonly transitoryfluctuationsn politicalandeconomicconditions.Evaluationof the size of government nvolvesan implicitcriterion: o saythat government s 'too big' or 'too small' is to implythat, like Goldilocks,


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Whatif Anythingis WrongwithBig Government? I Iwe know the right size when we see it. Conventionally, he size of govern-ment is measured n terms of a ratio of publicexpenditure o gross nationalproduct (see e.g., Nutter, 1978; Musgrave, I978). Littleattentionhas beengiven to the meaning of this ratio scale, notwithstanding ts patent faults.So gross a ratio ignores the great potential variability n the compositionofpublic expenditure,or the fact that the same ratio can be producedby verydifferentabsoluteor per capita levels of public expenditureand the nationalproduct. Moreover, since a substantial proportionof public expendituretoday consists of transfer payments, public expenditurecould be well overI 00 per cent of the nationalproduct.

Several economists have stipulated a 'threshold' value for the publicexpenditure/grossnational product ratio, that is, a line that should not becrossedelse governmentwould be 'too big'. But Colin Clark's I 945) warn-ing about the perils of governmentclaimingmore than 25 per cent of thenational product for public expenditure was long ago crossed withoutpunishment.And no socialscientificevidenceis offeredby Milton Friedman(I976) to justify his dire warnings about what would happen if publicexpenditurecrossed he 6o percent threshold.Political scientistshave concentrated armoreattentionupon studying thecauses of governmentgrowth rather than the consequencesof big govern-ment. (Cf. Larkey,Stolp and Winer, forthcoming)A greatnumberof mono-causal theoriesattemptto explain big government n termsof a singlecauseof growth,or concentrateattentionupon only a single dimensionof govern-ment growth,such as public expenditure.The resulthas been to unbalanceunderstanding.We know (or think we know)far more why government sbig than aboutwhat differencebignessmakes n government.The principalpoliticalsciencestudyof size in government, s inconclusive.Dahl and Tufte(1974, 135) reply to the question - 'Can we say, then, that there is anyoptimum size for a political system?'- with the statement: 'Clearly no'.Repeated attempts to define optimum size for cities, in terms of specificquantitative ndicators,have beeninconclusive, becauseoptimumsizevariesaccording o serviceor function'(Newton, I978, 5; seealso, Fischer,I975).Because analysishere concentratesupon governmentsn Westernnations,which have already become big by historicalcomparison,the question atissue is: what problemsare likely to arise when big governmentbecomesbiggerstill? No assumption s made about the growth of any one elementcrossinga 'danger' thresholdsince the elements of governmentvary sub-stantiallyin the likely consequencesof growth.Whilstno threshold s postu-lated, it would be wrong to assumethat the benefitsor costsof growth arelinear. Growthin an already big governmentcan compound problemsdis-proportionately.The consequencesof big governmentgrowing biggerstill are potentiallyvast. Here, the consequencesof growth are considered n relation to three


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12 RichardRosegeneric concernsof government achievingeffectiveness;avoidingcontra-dictions; and maintainingpopular consent.These are not the only effectsofthe growthof government.They have been selected becauseeach is of per-vasive importanceto the achievementof many publicpolicies,and each is,on a priorigrounds, ikelyto be speciallysignificant n causinga governmentbearingbig responsibilitieso become'overloaded'.'The reasonswhy growththreatens these attributes of political authority can be stated in genericpropositions.

(I) The growthof big governmentwill reducegovernmental ffectivenessinsofar as growth is concentratedupon programmesacking explicitand tested means-ends echnologies.The effectivenessof means-endstechnologiesavailable to governmentvariesgreatlyfrom programmeto programme. At one extreme, there are well tested 'hard' tech-nologies, such as civil engineering,which provide the means for agovernmentto build roads or bridgeswith predictableeffectiveness.At the other extreme, there is an absence of agreed or effectivetechnologiesfor realizingsuch social goals as abolishingpoverty orabolishingcrime.Betweenthese two extremes, here are a number oftestedsocial technologies or achievingsuch goals as massliteracy,orthe reduction of peri-natal mortality. A governmentcan be moreconfidentof buildinghousesthan buildinggood citizens,of teachingliteracy than entreprenurial bility, and of promoting good physicalhealthin infantsthan goodmentalhealthin adults.Governmentneednot loseeffectiveness s longas growth s confinedto already establishedprogrammeswith tested means-ends echnolo-gies. If growth simply meant increasingthe output of effective pro-grammes, and there were no non-linear losses of effectiveness (cf.Hood, 1976, 152ff) then the resultsneed not be unsatisfactory.Butthere are positive political incentives for politicians to expand thescope of governmentby introducingprogrammes o do things thatgovernmenthas not done before.New programmes,by definitionwilllead government o enter fields in which it has not yet demonstratedeffective competence. Establishedprogrammesmay find that theirtechnologiesbecome less effective or ineffective because of changesin external conditions. A preliminaryscanning of laws (see infra,pp. 19-2 I indicatesthat theirage is not yet a majorproblem.Greaterdifficultiesare likelyto arise from contradictionsbetween establishedand new programmes,or between the initial objectivesof a givenprogrammeand new or additionallymposedobjectives.

(2) The growth of big governmentwill increasecontradictionsbetweengovernmentprogrammesbecauseof a disproportionatencrease n theinterdependence of programmes.When government was relatively


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Whatif Anything s WrongwithBig Government? I3small, programmes were few in number and objectives were relativelysimple. Government sought to influence relatively few cells of themulti-dimensional matrix of social interaction, and many were un-connected with others. The growth of government has been intensiveas well as extensive, that is, programmes multiply affecting a givenarea of social life as education, health or the economy. When govern-ment is big, this increases disproportionately the probability that a newprogramme will affect and be affected by already established pro-grammes. The growth of programme interdependencies within asingle policy area is well illustrated by the growth in the number andvariety of government's responsibilities for the economy and the inter-actions between these programmes.

Contradictions are likely to increase with interactions, unless onebelieves in a hidden hand mechanism that assures that each and everynew programme of government is dovetailed to fit with existingpolicies. As the matrix of public policy becomes more densely packedwith programmes, then, as Wildavsky (I979, 65) notes, 'Interdepen-dence among policies increases faster than knowledge grows. For eachadditional programme that interacts with every other, an exponentialincrease in consequences follows'. Contradictions may be accepted bygovernments as a political bargain necessary to satisfy conflictinggroups or contradictions may be the unintended result of unanticipatedspillovers, in which new programmes impact established programmesin unanticipated ways. In such circumstances, a programme adoptedas a solution to one problem can create another by the contradictionsit 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 insofaras it increases the perceived impropriety of government's actions. InWestern nations government cannot assume co-operation for anypolicy it might choose to adopt. As well as a mixed economy, there is a'mixed' society, that is, citizens in every Western society draw adistinction between some things that are properly the sphere of govern-ment action (e.g. the regulation of public health, or compulsoryeducation) and some things that are not (e.g., the expropriation ofproperty without compensation, or compulsory abortion in pursuit ofa population policy). By contrast, in a totalitarian state governmentclaims that all of society's concerns are subject to government action.The contrast between what government deems proper to do in Easternand Western Europe today is a reminder of the importance in Westernnations 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


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14 Richard Roseimproper actions. Insofar as growth is extensive, involving governmententering a new policy area, then the very unfamiliarity of governmentin 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 Courtanti-discrimination decision is an example of this process. Alterna-tively, government may have an improper impact upon society asthe unintended consequence of pursuing new programmes; for ex-ample, in the course of removing slums or building motorways, it mayunintentionally 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 offerconclusive evidence: the point is to focus attention upon problems that arelikely to arise from big government. Examples will be drawn primarily fromBritain and the United States, but generalizations should in principle bemore widely relevant. The focus is on the present, for by any historic stan-dards, Western governments today are big - and in some respects show signsof growing bigger still.22. The ambiguityof resourcesResources are an indicator of government claims upon society, but notnecessarily of government benefits to society. This is most obviously the casein revenue-raising, for big government revenues mean big tax payments bycitizens, 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 thosewho work in the private sector. Laws can entitle citizens to receive benefitsof public policy, but laws can also obligate citizens to do what they don'twant 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 notthink of government simply in terms of the resources it claims. Resourcescan also be viewed as means to the end of producing programme outputs.The resources that government mobilizes are in the first instance no moreand no less than inputs into activities of government organizations. (Figure I)Every government organization depends upon a quantity of laws, publicemployees, and allocations of revenue to maintain its activities. The bulk ofgovernment policies involve the transformation of resources into physicalgoods (military equipment, roads, electricity generating stations, etc.) orservices produced by government employees (e.g., health, education, socialwork, etc.) Income maintenance programmes are exceptional in that their


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Whatif Anything s WrongwithBig Government? I5output (cashpayments) s in the same form as their principalresource publicrevenue).In turn, programmeoutputs of governmentare but inputs into society.Whether, how much and in what ways they affect social conditions areempirical(and often disputable)ssues,dependingupon the circumstances fthe programme,the governmentand the society. For example, health ser-vices do not assurethat individualrecipientsare or become healthy; theycompete with extra-governmentaldeterminants to influence individualhealth. This is most obviously the case in psychiatric reatment.Similarly,while educationserviceshave some influenceson what young people learn,schools are not the sole source of learning,nor are they all-powerful: amilyand community can exert countervailing nfluences.Governmentswith bigresourcesprovide more inputs to society than governments with few re-sources,but this grosscorrelationdoes not justify treatingresource nputs asif they were identicalto governmentoutputs.In analysing the consequencesof big government, t is crucial to remainconsciousof the distinctionbetweenresource nputsand programmeoutputs.Unfortunately, t is commonplace or politiciansand policy analyststo treatresourceinputs as if they were programmeoutputs. Such an approachisparticularlymisleadingwhen consideringgovernmentgrowing bigger still.In today'scircumstances,we are not, for example,concernedwith whetherthe abolition of compulsoryeducation would make a difference, but withmarginalanalysis:how much, if any, difference would it make to educa-tional achievements to increase or decrease education spending or thenumberof teachersor non-teaching taff in publiceducation?The fact of thematter is that we usuallydo not know what the marginaleffect will be ofrelativelysmall changes in resource inputs - up or down. Any statementabout the marginalutility of a specificquantum of governmentgrowth islikely to have a significanterrormargin, or to be based on faith or explicitpoliticalvalues.3In revenuetermsgovernment s 'big business', or the sums collectedbygovernmenteach year give it a bigger cash flow than any private sectororganization n the country.While nations differ in how they raisetaxes -Italy and France,forexample, relymore on indirecttaxes and socialsecuritylevies than do America and Britain- all Westernnations are big revenueraisers.Conventionalmeasuresunderstate he cashflow resourcesof govern-ment, for nationalized ndustries' evenuesare reckonedas the net profitorloss,and not in termsof grosstradingrevenue.Grossrevenue for electricity,gas, posts,telephonesand otherpublicutilityservices s a slack resource hatgovernmentcan mobilize when hard pressedfor funds, as the I979 Con-servativegovernmenthas done, forcingnationalized industries o draw in-vestment funds from current income rather than increase public sectorborrowing.


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i6 Richard RoseThe growth of government revenue in the postwar era has had three

principal causes: inflation, real growth in national economies, and increasingtax rates to yield government more money from a given volume of economicactivity. Of these three sources, inflation represents the greatest source ofgrowth, 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 halfthe increase in current value public revenue was caused by inflation, andabout half came from economic growth. By contrast, in the I97os, 87 percent of the increase in US federal revenue was due to inflation, and 93 percent in the United Kingdom (Rose, forthcoming, figure I). Whilst biggerbudget numbers do not ipso facto provide more public programme outputs(cf. Beck, I976), they necessarily create bigger tax bills. Trebling taxes incurrent money terms in the United Kingdom and doubling them in theUnited States in about a decade may lead ordinary citizens to perceive awidening gap between the costs and benefits of big government especiallywhen the constant value quantum of goods and services increases relativelylittle.

As government grows big, by definition it must improve its technology forcollecting public revenue, in order to get the revenue necessary to meet theincreased costs of public policy. The pressuresto improve revenue collectionhave been felt in France and Italy, historically countries with relatively highlevels of tax evasion, as well as in countries where government has assumedthat citizens would comply with revenue raising measures. But as big govern-ment grows bigger still, it can put at risk the marginal effectiveness of itsrevenue-raising policies. The reason is simple: the more money that govern-ment seeks in taxes, the greater the marginal incentive to citizens to avoid orevade 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 ineffective earnings; where the marginal rate is 50 per cent or more, as in someScandinavian countries, avoidance promises a I00 per cent marginal in-crease in earnings. There are good grounds to believe that tax avoidance andevasion 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 themanagement of the economy. Increased government demands for revenuecan generate inflationary wage demands as these demands may increasinglybe 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 transferprogrammes, can reduce funds available for investment necessary to sustaineconomic growth (cf. Geiger and Geiger, I978). The reduction of inflation,the stimulation of economic growth and welfare policies are all valued goalsof Western governments - but these goals can involve contradictions. More-


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What if Anything is WrongwithBig Government? I 7over, the prospects of making 'fine tuned' trade offs between them aredebatable given the uncertainties generated by complex international eco-nomic interactions.

Big and growing government claims for revenue can create problems ofpopular 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 formost of the postwar era; they were underwritten by the fiscal dividend ofgrowth. Post-tax earnings rose along with public revenues. A six per centincrease in public revenues would leave substantial scope for an increase inpost-tax earnings. As long as it was levied on only one-quarter of a nationalproduct growing at a three per cent rate, the growth in taxes would claimonly half the growth in GNP. But if government claims the equivalent ofhalf the national product for revenue, the same percentage increase wouldforce a reduction in take-home pay, if the growth rate of GNP dropped totwo 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 inpost-tax income in every major Western nation, and cuts that appear toreflect the culmination of long-term trends in Britain, Italy and Sweden.This is not regarded as a 'proper' function of the mixed economy welfarestate by trade unions or employer groups and threatens to produce indiffer-ence to government, and reduce the effectiveness of existing revenue-raisingtechnologies 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 maskedby official figures on the civil service, for most public employees are not civilservants: they work in local government, nationalized industries, or thehealth service. In Britain and the United States, the officially denominatedcivil service accounts for less than one-sixth of total public employment(see Rose, I980). In aggregate, government employs 30 per cent of thelabour force in Britain, and I8.5 per cent of the labour force in the UnitedStates. Public employees play a distinctive role in producing programmeoutputs. In major social programmes such as health, education and socialservices, their activities (that is, the provision of their skilled services) are theprogramme outputs. Moreover, public employees are not passive partici-pants in the policy process; they are also active agents influencing the scaleof public policies (cf. Niskanen, I97 I; Beer, 1976; Wright & Hebert,I980).

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 publicemployment from I95I to 1976 (see table 2). Where public employment was


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I8 RichardRoseTABLE 2. Alternativepathsof change in publicemployment,I951-76

Public employment: High growth Lowgrowth1951-76 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 continuedto grow in Swedenbut not in Britain.Wherepublic employmentwas initially low, it grew rapidlyin Italy but not in theUnited States. In effect, governmenthas becomeless labour intensiveas ithas grown bigger in revenue terms. This appears to reflect the growingimportanceof cash transferpaymentssuch as old age pensions.The growthof governmentreduceseffectiveness,because t tendsto occurin programme ields that involve less effective means-ends echnologies.Onereasonfor this is that the fields with the 'hardest'technologies,such as thegenerationof energy by public utilities, tend to be capital-intensive.Wheresuch industries are nationalized, then very larfge ncreasesin output canoccur with limited increasesin public employment (Rose, 1980, 76-8).The greatestgrowth of public employmentin major Westernnations hasoccurredin social programmes; hey have increasedtheir share of an en-largedpublic employmentby 28 per cent in the United States,and 23 percent in Britain. In the extreme case of Britain,without a growth of i.9million workers n health,educationand socialservices, otalpublicemploy-mentwould have contracted rom I95I to I976. In some socialprogrammes,there is a reasonablyeffectivemeans-ends echnology,but growthin socialpolicieshas involved new programmes oo, especially n social work,wherethe technology for achieving identifiable (let alone agreed) outcomes isweakest.Moreover,there appearsto be a tendencyfor less skilledand pre-sumptively ess effectivestaff to increasemore; within educationnon-teach-ing staff increasedmorerapidlythan teachingstaff,and in healthcare,non-medical staff increasedmorerapidly (cf. Rose, 1980, 76-8).Insofar as Westerngovernmentssee public employmentas a means ofcontributing o nationaleconomicgrowth,then there is a potentialcontra-diction between the present pattern of public employment and economicgrowthpolicies (cf. Baconand Eltis, I976). The contradictionarisesbecausea substantialmajority of public employeesare not engaged in producingmarketedgoods, but collectivegoods or welfareservicesthat, although inprinciplemarketable,aregivenaway. Publicemployeesproducingmarketedgoods range from eight per cent of total public employment n the UnitedStatesto 2 1 per cent in Sweden, 36 per cent in Britain,and 38 per cent in


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Whatif Anything s WrongwithBig Government? igItaly (Rose, 1980, 46). By definition, there are fundamental problemsofvaluing the output of goodsand servicesnot sold in the marketplace. In theabsenceof any marketmechanism o measureeffectivedemand,supply maydeterminethe production of 'give away' goods (cf. Tarschys, 1975). Eventhough governmentmay want to improve economicgrowth, it may itselfbereducinggrowth ratesbecauseof 'nonmarket'or 'collective ailures', nclud-ing goal substitution,excess costs, derived externalitiesand distributionalinequalities that can arise when governmentsupplies goods and services(Wolf, I979; Peacock, I980, 35ff).The scale of publicemployment oday posesa potentialthreat to popularconsent nsofaras the benefitsof publicemployeesareperceivedas improperbeneficesby the great majorityof the populationwho are not in the publicsector.Publicemployeesenjoy severalbenefits hat private sectoremployeeslack: their pensionscan be inflation-proofed; heir job security tends to begreater;and theiremployercan use taxationto meetwage claims.Moreover,public employees are normally more likely to be unionized than privatesector employees,and are strategically ar better positionedto bargainforhigherwages. Given these factors,and the tendencyof publicemployeestobe in jobs where productivityrisesmore slowly than in the privatesector,there is a relative price effect, that is, a tendency for public employees'earningsto claim a growingproportionof the nationalproduct(cf. Baumol,I967; Beck, 1976, 1979). While this effect may be ignored as long as it canbe coveredby the fiscaldividend of growth,today privatesectoremployeesmay think it 'improper' hat the total costof providing he incomesof publicemployeesis increasing thanks in part to taxes paid by private sector em-ployees, whose take home pay may fall in consequence.Increasingcom-plaints about public officials as a class and about taxation suggesta beliefthat those who work for big government enjoy 'too much' or 'unfair'advantages.

Because aws are a uniqueresourceof government, here is no simplewayto measuretheir relative claims upon society'sresources.Whereasgovern-ment claimsless than half the nationalproductand aboutone-quarterof itslabourforce, it enacts I00 per cent of the laws of a society. To attempt toassesswhat proportionof society's otal activitiesare regulatedby legislationwould presupposea comprehensiveaccountingof society'sactivities.More-over, lawsarefar lesssuitable o quantitativemeasurement han arethe othermajor resourcesof government. Whereas money is fungible and publicemployeesin the same grade will be paid the same, laws are not similarlyinterchangeable.Because their qualities and meaning are nominal, lawscannot easilybe totalledup. Moreover, ndividuallaws will vary greatlyintheir impact. A single law on social security can claim far more publicrevenue than a thousand 'average' acts, and a national health service willmakepublicemploymentgrowfar morethan hundredsof otherlaws.


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20 RichardRoseLaws 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, mandatoryexpiral of programme authorizations) only emphasize this point. The con-solidation or revision of legislation reflects a process best described as policysuccession not policy termination (Peters and Hogwood, i980). The statutebooks of every Western nation reflect the cumulation of many decades oflegislation. Paradoxically, this means that the more voluminous existinglegislation is, the smaller the proportionate growth is likely to be in any oneyear. Moreover, in Britain, the annual number of new Acts of Parliamenthas declinedby morethan one-third rom I90i-IO to the I970S (ButlerandSloman, i980), and the number of new Statutory Instruments each year hasnot 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 thewhole House has dropped fromn25 to 6 per cent, and the number of billsapproved as Acts of Congress has fallen by half since i962 (ACIR, I980,tables A-8, A-33). Federal regulations, however, have grown many timesfrom I956 to I975 (ACIR, I980, table A-12).

On a priori grounds, the cumulative growth in laws could reduce thetechnological effectiveness of government. Insofar as statutes cumulatedfrom generations past, then laws enacted in earlier and very different social,economic and administrative circumstances would presumptively be lesseffective than newer legislation. In practice, this is not yet a great problem.Notwithstanding the continuity of Parliament for seven centuries, the greatbulk of British statutes are relatively recent: two-thirds of Acts of Parliamentnow in effect and more than four-fifths of all Statutory Instruments havebeen 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 Englanddates since I970 (Parry, I979, table 6). Older laws are often general statutesconferring broad powers. The growth of legislation can involve consolida-tion of acts, and, at least in the Westminster Parliament, additions to thestatute books are likely to be made by a government conscious of what isalready there.

As the number of laws grows, the chances increase for contradictionsbetween laws. This is a much greater risk in a federal system, such as theUnited States, with a multiplicity of law-making bodies. It is also a greaterrisk in the United States Congress, where laws can be passed or amendedpiecemeal and ad hoc, by contrast with the Westminster Parliament, wherenearly all amendments are government measures accepted only after vettingfor the absence of inconsistencies with the principal objects of the bill


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Whatif Anythingis WrongwithBig Government? 2 I(Herman, I972). Contradictions between the courts and the legislature arealso much more likely to arise in the United States, because the separation ofpowers allows judges to pit their judgement against that of elected officials indetermining whether a measure is constitutional. Insofar as court cases areindicators of conflict wsithinsociety, there is a substantial increase in suits inboth England and the United States in the past twenty years (ACIR, I 980,tables A 9-I0; CentralStatisticalOffice, I979, table I3.17). But violationsof laws or uncertainty about their application are not indicators of logicalcontradictions between laws. Where contradictions arise, they are far morelikely 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 infavour of popular acceptance of their propriety. When people know what thelaw is and are habituated to accept it through the years, they are unlikely todeny its legitimacy. New legislation, by definition, must be endorsed by amajority of elected representatives, and opposition is often limited, or evennon-existent. A study of government legislation from I970 to 1979 inBritain, nominally a period of adversary politics, found that the oppositionparty did not vote against 78 per cent of all government legislation in thesecond reading debate on its principle (Rose, ig8ob, 8o-2). Criticisms ofgovernment's laws and regulations are usually not directed to the proprietyof government action, but rather dispute the merits of substantive pro-grammes. Where laws have often been flouted, such as legislation attemptingto regulate public morality, then governments are increasingly inclined torespond by repealing them, an unusual example of the contraction of govern-ment.

3. Sizing up organizationsIn theory, the number of organizations involved in big government need notbe any different than the number involved in a small government. A govern-ment could double the money spent on existing programmes, increasepersonnel by half and enact new laws while the number of its organizationsremained constant. Insofar as public officials were enamoured of doctrines ofeconomy of scale, big government might lead to a net reduction in thenumber of organizations, e.g. the consolidation of local government andspecial purpose districts in the United States (Wright, 1978, io), and inBritain, local government re-organization in the early I97os. The volume ofactivities 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 isa single entity, or two levels in a federal system. But operationally, it is a


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22 RichardRosemulti-organization henomenon, or each level of government s functionallydifferentiated nto a variety of departments. n turn, these departmentsarefurther divided into bureaus, sections, and other variously denominatedoperating units with specific programmeresponsibilities.The existence ofsub-departmental perating units is explicit in Washington,where bureausare recognized as independent political actors. In Whitehall, ministerialresponsibilityimits their political autonomy, but sub-departmental ivisionsare plain to see in the Civil ServiceYearBook, and reachextreme numbersin the 'mini-Whitehall'clustersof the NorthernIreland, Scottishand WelshOffices. In such circumstances, he enumeration of general purpose andspecial purpose units of governmentwill give only the grossestof indicatorsof scale. Enumeratingcentral governmentdepartmentswithout regardforwhat is happening within departmentsmay be actively misleading.For ex-ample, the creationof 'superdepartments'n Whitehallin the early 1970Sdid not signify a contraction n government (cf. Clarke, I97I, i; Sharpe,1977, 54-6).Complexity s centralto the conceptof organizational ize. A big govern-ment is organizationallya complex government. Complexityrefersto thedegree of interdependence between relatively differentiated institutions(cf. LaPorte, I975, 6), whethernominallyundera singlehead (e.g.a DefenceDepartment differentiatedbetween army, navy and air force) or separateinstitutions (e.g. local authorities and central departments funding theirprogrammes).Organizationalcomplexityis 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 programmefunctions will require differentiationwithin an organization (that is, thecreation of new functional divisions or bureaus) or else differentiationbetweenorganizations.In termsof means-ends echnology, growthin the size (as distinct fromthe programmes)of organizationsdoes not of itself reduce effectiveness.The biggest organizationswithin government are defence agencies andwelfare services.The militarvfor centurieshas had hierarchiesof commandthat permit growth throughthe multiplicationand decentralization f unitswithout any loss of authority. Contemporary ounterparts an be found ineducation and health, for much growth in these programmes ikewisein-volves the multiplicationof more-or-less tandardizedoperatingunits - thehospital,the doctor'soffice,the schoolor withinit, the classroom.The policyareas wheregrowthof governmenthas beengreatest n the postwarera havebeen areaswhere the organizational esponsibilityor delivering ervicescanbe decantedinto a large numberof relativelyfamiliarsmallscaleoperatingunits, and such 'pluralization' (Kochen and Deutsch, I980) is a relativelyeffectiveform of expansion.The growth of organizationsdoes have a major impact upon inter-


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Whatif Anything s WrongwithBig Government? 23organizationalrelationships n ways that can threaten both effectivenessand/or contradictionsbetweenorganizations.As governmentmultipliesthenumberand size of organizations, he interdependencies etween operatingunits are likely to increasevery greatly.When governmenthas five majororganizations, he numberof pairwiserelationshipss I0; when the organ-izationsincreaseto io, pairwiserelationshipsncrease to 45, and when thenumber of organizations ncreasesto 20, the numberof potential pairwiserelationships s I90. Doubling the number of organizationscan increaseinter-organizational nteractionsmany times.5 In such circumstances,anoctopus becomes too simple a metaphorfor government,since an octopushasonlyeightarmsand onehead.The growth of governmenthas even bigger implicationsfor interactionbetween governmentaland non-governmental rganizations. n a societyinwhich ten per cent of organizedactivitieswere the responsibility f govern-ment and go per cent the responsibility f the privatesectorthen, if organ-izationalinteractionswere random, four-fifthsof society'sorganized affairswould involve interactionbetweenprivateorganizations,and only one-fifthwould involvegovernmentas one or both partners.But if the proportionofsociety'sorganizedactivitiesthat were the responsibility f governmentroseto 30 per cent, then more than half of all organized nteractions n societywouldinvolvegovernmentasa partner.Given the openness or 'vulnerability'of any governmentorganization oactionsby anotherorganization whether at the same, superioror inferiorlevel of government- there is a disproportionateneed to 'clear' actionsbetweenorganizations s governmentgrowsin order to avoidcontradictions.The processof clearancecan be time-consuming n the extreme,as Pressmanand Wildavsky (I973) have shown in their study of implementinga newprogramme in the Americanfederal system. Even when a programme iswell established,an organizationwill need to invest substantial efforts tomaintain itself in a complexinter-organizationalnviroment(see e.g. Hanf& Scharpf, I978; Hood, I976; Rhodes, I980). In Britain,the growth ofCabinet committees s an illustrationof growingorganizationalcomplexityat the top. In America, the characteristic omplaintis of increasingcom-plexity in vertical relationshipsbetween as many as five differentlevels ofgovemment (ACIR, I980, i6). At best, the complexitiesof inter-organiza-tional clearancesmay reduceefficiencyslightly n orderto avoidprogrammecontradictions.But giventhe scaleof big government,even a relativelysmallloss of efficiencycan be substantial n absoluteterms. At worst, the con-tinuingjostlingof differentorganizations, ach concernedwith aspectsof thesame policy area,can so reduceefficiency hat the resultcan be describedas'pluralisticstagnation'(Beer, I969, 407).Contradiction is implicit in inter-organizationalrelationships,insofaras each organizationis an institution with its own needs and priorities


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24 Richard Rose(cf. Thompson, I967). In relationships between separate operating units ofgovernment, the idea of national government, let alone the national interest,begs the question: what is the 'nation' to which each operating unit owes itsprimary loyalty? Government policy is an empty symbol when two units ofgovernment are bargaining about what policy should be in matters affectingthem 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 ofgovernment 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 orcontradictory demands can, as Newton notes (cf. 1978, 24f,-and Dahl &Tufte, I974, 89) be valued as a positive contribution to making politicalvalues explicit; where government is smaller, it may appear more consensual.Moreover, where particular organizations within government have ties withclient groups outside government then, as Heclo (1978, 89) argues, there canbe 'a dissolving of organized politics, and a politicizing of organizational lifethroughout the nation'.

Growth in the size and number of government organizations threatenspropriety insofar as the additional organizational layers increase politicaldistance between elected politicians and those they are meant to represent.The number of top leadeis is always fixed at a few, while operating units ofgovernment can multiply indefinitely. Insofar as top decision-makers areremote and inaccessible, government might be expected to overstep moreoften the bounds of propriety - if only in ignorance of what ordinary citizensthink and feel. Dahl and Tufte (I974, 75ff) describe how an increase in thescale of government gradually leads from 'asymmetric' communication, 'inwhich citizens are treated as an audience' to conditions in which leadershiphas become so remote and specialized that 'top leaders communicate withone another through intermediaries, if at all'.By definition, every government organization has propriety in the eyes ofsome political groups; otherwise, it would have lacked sponsors withingovernment, and sufficient political support to gain establishment. But thegrowth of government organizations can collectively increase citizen frustra-tion, insofar as different organizations of government become enmeshed innegotiating with each other, rather than directly responding to politicaldemands. What Grodzins (I966) once described as the 'multiple crack' of

federalism provides pressure groups with 'open access' to government in theUnited States; in Whitehall too, departmentally oriented policy communitiessprout (cf. Richardson & Jordan, 1979; Hewitt, 1974). But more complexorganizations cannot so easily make collective decisions that cut acrossorganizational boundaries, or even package in one organization all the ser-


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Whatif Anything s WrongwithBig Government? 25vices a citizenmay need. For example,a British firmwishingto establishafactory in an area of high unemploymentwill have to negotiate with avarietyof central,local and 'off-line' governmentagenciesand become (orhire) an expert in inter-governmental elations in order to assembletheappropriatepackageof permissionsand benefits(see Hogwood, 1977). Theproblem of co-ordinatinggovernmentpolicy is far more difficult for theunemployedworkeror single parent entitled to categoric welfare benefitsfrom a host of governmentagencies, if he or she could but organizethem.When governmentis big, organizationsare not so much criticizedforimproperactivities as they are for failing to achieve their properactivities,whetherbecausea narroworganiizationalmissionis blockedby uncoopera-tive organizations lsewhere n government,or the organization s itself un-willing to submerge ts narrowmissionto contributeto a broadergovern-mentalobjective.The multipleorganizations f governmentbecomea mazeof interdependencieswithout a hierarchyof authority,a market nvolvinganexchangeof influenceor bargainingrelationships etweenbuyersand sellers,each of whom has somethingto gain from the other in deals made withoutcollective electoralendorsement.Big governmentmay still be able to dealeffectivelywith particularsof publicpolicy,but it may be increasinglyweakin discharging ts propercollectivefunction of resolving nter-organizationalconflicts (cf. Lowi, I969; Heclo, 1978; Rose, I98oc).4. ProgrammegrowthViewing government n termsof programmesputs the purposesof govern-ment in the forefront.Programmesare legal and bureaucraticattempts totranslategeneral policy intentionsinto specificgovernmentactions. Whileprogrammeoutputs should not be confused with programmeimpacts orachievements, they are a systematic and purposeful way of identifyinggovernmentactivities.Moreover,both governorsand governedusuallyviewgovernment as a set of organizationsproducing public policies to somepurpose.Logically, government could grow without any increase in its pro-grammes: growth could simply reflect the allocation of more and moreresources o existingprogrammes.At the otherextreme,growthcould resultexclusivelyfrom the adoptionof new programmes.However, the empiricaldistinctionbetweenestablishedand new programmess not clear-cut.Thereare greatgreyareasbest describedas the expansionof existingprogrammes.For example, education may expand by increasingthe number of yearschildren are required o remainin school,or by increasing he proportionofyoung people in tertiary education. 'New' programmes are usually notcreated by parthenogenesis: heir parentageand lineal descent is evident.Often, new programmesare grafted onto establishedprogrammesor con-


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26 RichardRosegenes of programmes. In other words, there is not a clear-cut distinctionbetween 'more' programmes and 'bigger' programmes.

An OECD (1978, 26ff) study of public expenditure growth in majorwelfare areas - education, income maintenance and health - since the earlyI 960s illustrates the importance of programme expansion. The largestportion of increased expenditure was attributed to eligibility changes thatexpanded programme coverage, making it possible for more people to claimincome maintenance grants in a greater variety of ways, for more youthsto get more education, and for a wider range of health benefits. Demo-graphic expansion in the population made established programmes growbigger, requiring greater resources without any change in programme objec-tives. To a noteworthy degree, welfare programmes also grew bigger in termsof resource costs, without any increase in programme outputs because of anincrease in the relative cost of established programmes. In short, the greatincrease in the resource cost of welfare programmes reflects more than justdoing more of the same; it would be more accurate to speak of growtharising more from the 'broadening' of welfare programmes than the creationof major new programmes.

Every year government adds some new programmes by legislation.(Rhetorical statements 'reshaping' the verbal justifications for establishedprogrammes are likely to be of little effect and there are limits to the extentto which resources can be reallocated without legislation.) The limitedimpact of new legislative programmes upon the growth of an already biggovernment is indicated by an analysis of the public expenditure implica-tions of new programmesn Britainin the I97os. From I970 to I974, theConservative government added i6 new spending headings to one hundredor so programme headings into which the Treasury divides total publicexpenditure. 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 atan average cost of about ?65mn. and a total cost equal to o.8 per cent of1978/79 public expenditure (see Rose, ig80b, I24). In other words, thebigger the existing programme commitments, the less significant in overallresource terms is the enactment of new programmes. Even if the bulk ofadditional resources are devoted to expanding established programmes, thebulk of government's political capital may be invested in new programmesand new programmes can create a disproportionate amount of difficultiesfor 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 previouslynot the subject of government action, for example, genetic engineering.Growth is intensive if a new programme is within an area already covered by


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What if Anything s WrongwithBig Government? 27a numberof public policies,for example addingcategoriesof entitlement orincomemaintenance.At one time, governmentconcentratedprimarilyupon activitiesfor whichthere were well known organizational echnologies.The minimalistmodernstate had only to maintaindiplomaticand defenceforces,courtsand police.Beyondthis, its majorprogrammeswere likely to concern resourcemobiliza-tion through civil engineeringprojects, buildingbridges,roads and canals.Milleniaago the Romans had developed appropriate echnologies.Initially,social policies also tended to involve relativelyeffective technologies,as inpublic healthorteachingprimary iteracy.

Contemporary overnments ind that mostof the 'easy to do' things havealready been done. Yet political pressures or new programmes withingovernmentas well as externally- are not constrainedby a priorneed todemonstrate an effective means-endstechnology. In the I96os, expansionwas stimulatedby the buoyancyof governmentrevenueand, equallyimpor-tant, a buoyantconfidence hat governmentcoulddevelop the technologytodo what it willed, such as win a war on poverty and a war in Vietnamsimultaneously.But the effectivenessof governmentwill decline insofarasnew programmeshave objectivesbeyond the means of government (or anyorganization)to achieve. This is specially true insofar as the stimulus toaction in the AmericanWar on Poverty- 'Faith and beliefsnot research'(Aaron, 1978, ix) - is a common cause of forward leaps in governmentgrowth.The extensivegrowth of governmentprogrammeshas been stimulatedbythe logical insightthat it is more desirable o treat causesrather than symp-toms of social problems.This has involved the expansionand redefinitionofprogrammegoals: it is no longer enough to apprehendand gaol criminals;they should also be cured of their proclivities o crime. To ameliorate thecondition of poor people is inadequate; the causes of poverty should beeradicated.Counter-cyclicaleconomic policies intended to compensateforfrequent ups and downs in the economy should be replaced by 'balancedgrowth'. Social services should not only act as a safety net for those withsocialdifficulties, ut also removethesehandicaps.Treating the causes of social problems s well intentionedin theory, butsubjectto two fatal flaws. It assumes hat we know what the causesof socialproblemsareand that governmenthas the knowledge,resourcesandpoliticalwill to treat these causes.Yet there is no requirement hat knowledgemarchhand in hand with intentionsor desires.A government s not constrained oenact programmesonly where it is sure of being effective.Any innovativeprogramme- say, to combat juvenile crime where dozens of earlierpro-grammes have previouslyfailed - involves a disproportionaterisk of in-effectiveness.To obviate this, governmentmay even substitutean objectivefor which there is a knowntechnology (e.g. the installationof computerized


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28 RichardRoseinformation systems for the police) in place of objectives that it does nothave the means-ends technology to achieve (e.g. the reduction of crime).

The extension of government programmes has given increased emphasisto policies that are relatively unpredictable inputs to social processes. Whengovernment concentrates upon what organizations can produce with aknown technology - building a new road or a new housing estate - finaloutputs are predictable. But if the objective - for example, improvingtransportation or building a 'good' community - is defined in terms ofsecond-order social consequences also influenced by a multiplicity of extra-governmental factors, then the degree of effectiveness is contingent. Suchprogramme outputs become inputs to a process of interaction that govern-ment can influence but not control. For example, the determinants of a goodcommunity (however so vague an objective be defined) are multiple; thehouses, schools and other communal facilities built and maintained bygovernment have only an uncertain and limited effect. Good communitiesreflect a host of influences, some directly controllable by government, someidentifiable by social scientists but not controllable by government, and somedeterminants (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 graduallylearning, from failure as much as success, how to deal with major problems ofsociety (see e.g. Sundquist, I970). Heclo (I974, ch. 6) describes the growth ofsocial policy in this century as a process of gradual social learning; in thisparadigm, failure or disagreement in the evaluation of outcomes is as fruitfulas perceived success. From a different political perspective, such as that of afree market economist, the same process can be described as a progressivedebilitation of understanding through an increase in popular appetites forbenefits that, in the long run, cannot be sustained by society's resources(cf. Brittan, I975; Buchanan & Wagner, 1977). And Wildavsky describesthe increase in programmes as a process of increasing ignorance, as themultiple 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, seriousdifficulties are generated for the achievement of other, widely supported aimsin proximate policy areas... As policy effects accumulate and interact, theexplosion of costs becomes less important than the implosion of spillovers'(Heclo, I975, quotedin Wildavsky,1979, 66).

Insofar as new programme objectives are intensive impacting a policyarea which already has a number of established programmes, then there is anincreasing probability that actions taken to promote one programme willcontradict another. As the number of already established programmes grows,the likelihood of contradictions increases disproportionately. Government


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Whatif Anything is WrongwithBig Government? 29bureaus responsible for particular programmes do not divert attention fromtheir primary objectives to speculate about second-order consequences forother organizations, especially when these consequences are both numerousand increasingly difficult to anticipate. Attempts in Washington to compelthis by mandating requirements for a multiplicity of impact statements - forthe environment, inflation, urban problems, etc. - are prescriptions for in-effectiveness. A programme that imposed no costs would probably be soslight in its consequences as to involve little benefit as well. Only a naivebelief in a fundamental harmony of groups in society or in comprehensivegovernment planning preventing it from adopting non-contradictory objec-tives could ensure that contradictions will not grow disproportionately asprogramme objectives become more intensive in a given policy area.The most familiar and persisting contradictions tend to arise betweeneconomic and welfare objectives. Insofar as government wishes to promoteeconomic growth, then by definition it accepts continuing change in itsnational 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-regionalmovements of population as socially undesirable, then it may adopt pro-grammes to sustain declining industries and declining regions. There is acontradiction between economic investment and social policies. The formerinvolves '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 theindividual level, the contradiction is familiar in income maintenance pro-grammes, which have the welfare objective of meeting the social needs offamilies and the economic objective of maintaining the will to work. Theresult can be a 'poverty trap', in which earnings of poor people are taxed athigher marginal rates than the rich, and occasionally at more than ioo percent.

The growth of regulation in the United States has institutionalized con-tradictions between procedural and substantive programmes. An agencytraditionally concerned with a substantive programme, such as building high-ways or education, now finds itself part of a 'multi-mission' complex ofgovernment programmes, with mandated procedures independent of itsprogramme mission. A substantive agency now finds itself subject to a hostof new federal laws concerning non-discrimination, environmental protection,planning and project coordination, labour and procurement standards, andaccess 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 theinstitutionalization of conflicts about the primary purpose of a programmefor which an organization is responsible.Contradictions between social preferences are not new. What the growth


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30 Richard Roseof governmenthas done is to internalize hese contradictionsn government.For example, the conflictbetween borrowers nd lenders s of ancient origin.What is new today is that governmentsimultaneouslywishesto protectthevalueof currencyby pursuinganti-inflationary olicies,while simultaneouslywishingto bring aboutotherbenefits hroughpursuing nflationaryor cheapmoney policies. For a period in the I96os, the Phillips curve provided arationale for resolving these contradictionsby a 'trade off', an economist'sterm for political compromise.But the effectivenessof the trade off wasended by the adventof stagnation.When conflicts nvolvezerosumissuesofprotecting the environmentas against allowing industrialexpansion wherenationalized industries choose, then there can be zero sum contradictionswith governmentwith each public agency advocatingcompeting definitionsof the publicinterest cf. Gregory, 97 I).The expansionof the programmeobjectivesof government s intendedtoincreasepopularsatisfactionwith government,but good intentionsdo not ofthemselvesguarantee he proprietyof governmentactions.In a periodwhenbig government threatensto consume 'too many' resources, governmentprogrammes hat fail to achieve their intentionsmay be deemed improperbecausethey waste public resources.More interesting s the possibility hatsuccess createsa negativereaction.For example,the impact of US govern-ment programmes mandating measures for safer automobiles may bedeemedto placean improperadditionalcost on consumers.Systematic goal substitutionby programme agencies can also generateimproprieties, nsofar as intendedbeneficiaries f a governmentprogrammeperceive that other objectiveshave been substitutedto their relative dis-advantage. CharlesWolf has demonstrated hat non-marketpublic sectororganizations are subject to internalities or private goals, that is, operatingtargets used in place of direct-performance indicators available in marketorganizations (Wolf, I979, I 16). These producer-selected objectives may bereasonable proxy measures for intended benefits, or even be dictated byclient groups rather than legislators. Alternatively, they may be determinedprimarily for the benefit of the agencies themselves, e.g., maximizing staffincome and status or generatingnew technologyor information or its ownsake. Many of Wolf's examples are cited from the military,where perfor-mance is peculiarly difficult to evaluate in peacetime. But the War onPoverty was also marked by allegations that the producers of anti-povertyprogrammes were more interested in promoting their intemal organizationalgoals than in substantive performance (see e.g., Pressman and WildavskyI973).Big government - and particularly, further growth in big government -threatens to breach the bounds of propriety of any 'mixed' society. Bydefinition, a portion of a mixed society's activities exclude government in-volvement, just as another portion is deemed the proper responsibility of


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Whatif Anything s WrongwithBig Government? 31government. Looking backward, we can recognize a time when governmentwas too small to discharge the functions of the contemporary mixed economywelfare state. There are no agreed prospective criteria to identify thresholdsthat would mark govemment becoming 'too big', that is, exceeding what isdeemed its proper limits. Yet the bigger government becomes, the lessrelevant are nostalgic concerns about the minimalist nightwatchman state.At the same time, the more realistic are anxieties about big governmentexpanding into spheres properly outside its responsibilities in a mixed society.Political values rather than arithmetic ratios are the determinants of whatconstitutes 'too much government', and may depend on qualitative ratherthan quantitative concerns, e.g. in a field such as population policy. Theprogrammes of a Western government can expand indefinitely - but con-tinuing growth implies an increasing risk of impropriety, or justification byvalues more appropriate to authoritarian or totalitarian regimes than toWestern societies today.

Attempts to introduce or sustain government-mandated wage and priceprogrammes in the present turbulent economic climate show how the limitsof political propriety force Western governments to restrict the scope ofprogrammes, sacrificing hopes of effectiveness to maintain consent by stayingwithin the bounds of propriety. The nominal objectives of wages and pricespolicies may be broadly acceptable in contemporary mixed economies. Butthe means necessary to maintain such policies indefinitely can involve 'toomuch' or 'improper' government interference with the rights of free tradeunions to bargain for wages and/or with the rights of businesses to determineprices and profits. Voluntary controls are likely to be regarded as acceptablebecause they do not extend government's power improperly into what isregarded as the private sector of the economy. But voluntary measures maybe ineffective just because they do not have the force of law behind them.Normative problems about how far a Western government may properlyintervene in the market impose practical limits upon government effective-ness (see e.g. Goodwin, i975; McCarthy, 1978; Schwerin, I980).

5. The particularsand the sumeffectBig 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 onthe scale that we know today. Critics of the shortcomings of big governmentsee reasons why the growth of government should continue, because ofdynamic forces within government, making it easier for government toexpand, if only to correct its previous failures (cf. Wildavsky, I979).Proponents of the programmes of big government fear that evidence offailure to realize expectations of the Kennedy-Johnson or Wilson-Heath


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32 RichardRoseyears may dampen enthusiasm for new government programmes (Aaron,1978, 152ff). Whichevergroup temporarilyholds the dominant politicalposition in society, government is sure to remain big, whether judged byhistorical standards or by the size of other organizations in society.

Contemporary governors face the immediate problem of coping with theproblems of already big government. These problems are both general andparticular. They are particular, inasmuch as government is organizationallydifferentiated into many different operating agencies, each with particularprogramme concerns and claims upon resources. They are general, insofaras the sum of particular programmes generates the big total claim uponsociety's resources, and at present, governments are nervous about whetherthey 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 andthe parts. A recurring dilemma in political discusions of the size of govern-ment is the reconcilation of global resource constraints and the attractions ofgiving specific programme benefits. The ideal of most politicians, whenpresented with pressuresto spe.nd more in particular and less in general, is torestrain resource claims in general without cutting particular programmeoutputs. The favourite strategy for thus resolving the dilemma is to seek theelimination of inefficient or ineffective programmes, in order to have moreresources for effective and efficient programmes. Unfortunately, readilycutable 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 wasteeasy to identify or eliminate. If it were, it would have been disposed of longago. The failures of the Nixon, Heath and Carter administrations to savemoney by reorganizing government are symptomatic of the contrast ingovernment between managerial good intentions and political realities.

The favourite strategy for expanding government painlessly is to assumethat growth will not only add to the sum total of human happiness, but alsocreate additional societal resources, thus leaving unaltered government'sproportionate claim upon the nation's total resources. For example, measuresintended to stimulate full employment may be justified by relating theimmediate increase in money and personnel costs to the anticipated growthin national employment, national income and subsequent governmentrevenue. But one consequence of the growth of government is that timehorizons become foreshortened. For example, pump-priming governmentdeficits have grown so great that the short-term financing of past deficits canbe an immediate and pressing anxiety of government.

Whatever political perspective is adopted, the chief problems of size facinggovernment today are marginal, whether these are questions about marginalgrowth, marginal contraction, or a relative reduction in rates of growth by


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Whatif Anything s WrongwithBig Government? 33comparisonwith the previoustwo decades.To say this does not reducethedifficultiesof governing, or preceding ectionshave shownwhy the problemsof growingbiggerare greaterthan the problemsof remainingbig. And theproblemsof 'cutbacks', even if only marginal, are great too (cf. Levine,1978).If government s to continueto grow,it could do so in a varietyof distinc-tive ways, such as increasingprogrammeoutputs at no noticeableresourcecosts; increasingresourcesat no noticeable ncrease n programmeoutputs;and by makingorganizational hangesmore or lessirrelevant o programmeoutputs or resource claims. In the cut and thrust of government, mostchanges are in fact debatedin termsof programmealternatives.When thepressuresupon government resourcesare great, the opportunity cost ofgrowthis speciallyhigh. It followsfrom the precedinganalysisthat growthis most likely to have a positive result in cost-benefitterms, insofar as itinvolves the expansion of well establishedprogrammes. In such circum-stances,effectiveness s known, new activitiesare not created that risk con-tradictions with other programmes or disputes about the propriety ofgovernmentaction.By contrast,growth s mostlikelyto havenegativeeffectswhen it involves launching new programmes, or these will have untestedmeans-ends echnologies,riskcontradictioonsnsofaras they occur in inten-sivelyservicedpolicyareasor riskdisputeaboutproprietyby enteringpolicyareaspreviouslyoutwith the concernof government.The biggergovernmentbecomes,the moredifficult t is to make a judge-ment about governmentindependentof a judgement about society as awhole. When governmentis big, then most everyday actions of citizensdirectlyor indirectlyaffect what it does, and vice versa. For example,state-ments about the success or failure of a governmentto promote economicgrowthare asmuch a statementabout the socialsystemas they areaboutthepolitical economy (cf. Beckerman, 1979). Just as we cannot expect thegovernmentof a poorThird Worldcountry to transcend ts nationallimita-tions, so we cannot expect a big Westerngovernment o be more successfulthan its societytoday.

NOTESI For a fuller discussion of the importance of effectiveness and consent as crucial analyticfoci 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 causeand 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 aselasticity 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 marginalbenefits.


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34 RichardRose4 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 inpublic expenditure is equivalent to 3 per cent of GNP. In the former case, any growthrate larger than I.5 per cent will provide a 'fiscal dividend' big enough to increase take-home pay as well as public revenues. In the latter case, a national growth rate of lessthan 3 per cent will force a cut in take-home pay.5 The formula is: n(n- )2

REFERENCESAaron, Henry J. (1978) Politics and the Professors: the Great Society in Perspective.

Washington, D.C.: Brookings Institution.ACIR (I980) The Federal Role in the Federal System: the Dynamics of Growth. Washing-ton, D.C.: Advisory Commission on Intergovernmental Relations.Bacon, Roger and Walter Eltis (1976) Britain's Economic Problem: Too Few Producers.London: Macmillan.Baumol, W. J. (I967) Macro-economics of unbalanced growth: the anatomy of urbancrisis, American Economic Review, 57, 405-26.Beck, Morris (1976) The expanding public sector: some contrary evidence, National TaxJournal, 29, 15-21.Beck, Morris (1979) Public sector growth: a real perspective, Public Finance, 34, 313-55.Beckerman, Wilfred (ed.) (1979) Slow Growth in Britain: Causes and Consequences.Oxford: Clarendon Press.Beer, Samuel H. (I969) Modern British Politics, 2nd edition. London: Faber and Faber.Beer, Samuel H. (1976) The adoption of general revenue sharing: a case study in publicsector politics, Public Policy, 24, 127-95.Brittan, Samuel (1975) The economic consequences of democracy, British Yournal ofPolitical Science, 5, 129-59.Buchanan, J. M. and Richard Wagner (1977) Democracy in Deficit. New York: AcademicPress.Butler, D. E. and Anne Sloman (I980) British Political Facts: 1900-I979, 5th edition.London: Macmillan.Central Statistical Office (1979) Social Trends: io. London: Her Majesty's StationeryOffice.Clark, Colin (1945) Public finance and changes in the value of money, Economic Journal,

55, 371-89.Clarke, Sir Richard (1971) New Trends in Government. Civil Service College Studies 1.London: Her Majesty's Stationery Office.Coughlin, Richard M. (I980) Ideology, Public Opinion and Welfare Policy. Berkeley:University of California Institute of International Studies Research Series No. 42.Dahl, Robert A. and E. R. Tufte (I974) Size and Democracy. Stanford: Stanford Univer-sity Press.Fischer, Claude S. (I975) The city and political psychology, American Political ScienceReview, 69, 559-7I.Friedman, Milton (1976) The line we dare not cross: the fragility of freedom at 6o percent, Encounter, 47, 8-14.Geiger, Theodore and Frances M. Geiger (I978) Welfare and Efficiency. Washington D.C.:National Planning Association.Goodwin, Craufurd D. (ed.) (1975) Exhortation and Controls: the Search for a Wage-Price Policy, I945-7I. Washington D.C.: Brookings Institution.

Gregory, Roy (I971) The Price of Amenity. London: Macmillan.Grodzins, Morton (i966) The American System. Chicago: Rand, McNally.Gutmann, Peter M. (1977) The subterranean economy, Financial Analysis Yournal, 33,26-34.Hanf, Kenneth and Fritz W. Scharpf (eds.) (1978) Interorganizational Policy Making:Limits to Coordination and Central Control. London: Sage.


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Whatif Anythingis Wrongwith Big Gov

what if anything is wrong with big government

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