Kling’s ideas for state-capacity libertarianism

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Russ Roberts interviews me. It’s a high-energy interview about my suggestion for having a more rigorous and constrained administrative state.

So, one of the ideas that I have, they’re kind of twin ideas for improving the administrative state. One is to actually have the administrative state organized like a business organization, not[?]–profit-seeking, obviously, there obviously are things you can’t have.

But, actually to have a Chief Operating Officer [COO] who can reorganize, fire, hire, put in systems of accountability. . .
And the other key element, structurally, is I think we need a very powerful audit agency. An agency that can step in and evaluate how the regulatory agencies are doing, make sure that they’re not abusing power, and question them when they’re not being effective.

Russ ends up giving the idea a B-/C+. He likes FITs better.

A listener wrote to me about the audit agency idea:

For what it’s worth, such an organization already exists in [North] America. It’s called the Office of the Auditor General of Canada. Each Canadian province has one of its own too.

Thanks to our first-past-the-post electoral process (with more than two parties participating), we too often get majority governments that are able to ride out the scathing criticism that is often to be found in an auditor general’s annual report. But if the election is near or a minority government has been elected, an auditor general’s report can have quite an impact.

Of course, the U.S. also has the GAO and various Inspectors General. Getting the process to be effective requires more than just creating the position.

9 thoughts on “Kling’s ideas for state-capacity libertarianism”

  1. Every such reform has already been tried. Some a dozen times. And the added layers of deadwood bureaucracy remain.

    Federal agencies have had COOs for a while now. GAO reviews: https://www.gao.gov/assets/gao-08-34.pdf

    And the Inspectors General are the worst hives of waste, fraud, and abuse in the federal government. With no budgetary control over them, they give all their staff firearms to Jack up their pay, give everyone administratively uncontrollable overtime pay and have the highest graded positions in government. No discernible effort at all to control payroll because they can always make up numbers for how much they are saving.

    No, you would do much better reducing cliche by getting rid of all of them altogether. Federal agencies view the President as a mere stakeholder. To get any sort of responsiveness out of them, the administrative overhead needs to be pruned back.

    A good first executive order for the next President would be to order a 30 percent reduction in headquarters staff. This should be easy enough- federal agencies have no legitimate business in providing exclusive content to social media companies that citizens are forced to subsidize directly just to see how their money is being wasted. Banning federal social media accounts alone would eliminate the need for about a minimum of 10,000 FTE. Then , a little harder lift, move budgeting out of the agencies and just have the White House policy councils set request levels and let OMB run the apportionment. You could save 100,000 FTE and as a added benefit the President would be restored as a meaningful player in the executive branch. Eliminate pay and grade retention so you could actually save money by downsizing. Then you could eliminate countless unproductive positions by returning to an authentic merit system with a genuine government wide examination based hiring system. Offer a test once a year and require all new hires to come from the pool of passing test takers. Agencies could bid for the candidates they want much as they do under the Presidential Fellows program. And on and on. Anyone sentient with six weeks time in DC could come up with 10,000 pointless programs to cut.

  2. Ibrim X Kendi has been widely ridiculed on the right for proposing a powerful, all-seeing agency with a mandate to determine which government policies are racist and which anti-racist. How is Kling’s proposed auditing agency different, except in mission? Wariness about creating any big new agency should be in order.

  3. Why not profitability? Setting up services so that they have overlapping services and allowing people to choose the one that provides better services and setting budgets based on ‘customer acquisition’ sets all of the profitability incentives that could desire. Creating some entry and exit criteria and you have yourself a market or something close enough that it shouldn’t make a ton of difference.

    [I recognize that ‘just do x, y, z’ is vastly oversimplified and there are lots of hurdles both legally and administratively to setup a ‘market’ that works – but profit isn’t magic, if you provide something that customers want better than your competitors then you succeed and stuff improves.]

  4. Reason recently featured (https://reason.com/2021/09/23/21-federal-agencies-manage-200-different-diet-related-programs-leading-to-overlap-and-chaos/) a GAO report; the headline was “21 Federal Agencies Manage 200 Different Diet-Related Programs, Leading to Overlap and Chaos”

    I don’t think the GAO report was mentioned anywhere other than Reason. Waste and incompetence in government is (a) not news; and (b) few people care any more, just us cranky libertarians.

    So I’m not sure the political winds favor your proposal, whatever its merits.

  5. “Every such reform has already been tried. Some a dozen times.”

    Right, especially about IGs. I had to shake off a weary and sorrowful form of PTSD when I heard a lot of those recommendations. “Nah, they tried that 15 years ago, didn’t do anything. Oh, and that other thing, turned into a total fiasco.”

    There are already multiple layers of outside auditing and comprehensive retrospective reviews of programs, and many of their products are actually quite excellent. Nobody but a handful of people actually read them, but, still, good quality stuff. But at the end of the day, it always turns out that it’s all for nothing. About the only time they get used is when it already has a politically powerful backer who needs cover to do what they want anyway (a lot like why CEO spend big to hire outside ‘consultants’ for ‘prestige armor’), and usually, in a way that sweats the small stuff – straining out gnats while organizations continue swallowing camels.

    There really is no alternative to the CEO-principle of full Authority and Responsibility being vested in one individual so that interests are aligned and people are properly motivated because they can be held accountable for performance, outcomes, and actual results. That’s a minimum, and would have to be combined with other critical reforms involving radical transparency and measures to counter the open secret of the corrupting influence of expected gains and payoffs following government employment.

    The bottom line is that the system is designed such that powerful constituencies are all arrayed against the very notion of accountability, and so opposed to it that anything you try to do to impose it becomes High Value Target #1 for neutralization, and indeed, they always are.

  6. The government’s policies are already audited and very frequently influenced by a highly reputable, powerful and historic agency called the New York Times. They just don’t audit in the direction you (presumably) want.

    More to your point, if we did have an auditor that was expert enough and powerful enough to effectively guide the government agency, why not just abolish the government agency and put the auditor in charge?

  9. At the beginning of DJT’s term I submitted online the suggestion that all government GS employees/departments should be reduced by 5% across the board. Have you ever been part of an executive branch RIF? Anthill stirred with a stick… No one has time to make sure that the new exec gets nothing done. Everyone is busy CYAing. Made more fun by the fact that there are a lot of potential retirees who have been hanging on beyond their expiration date who will be “encouraged” to cut the cord. The new Cabinet officers/ department heads get a breathing space and a chance to peruse the records of the bottom 5 %. Just 5 %…That being said I also like the just before the election change to the status of SMS. Probably reversed by the Swamp

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