Public Values and Public Interest

Counterbalancing Economic Individualism

Barry Bozeman

• Publisher: Georgetown University Press
• Year: 2007
• ISBN:
  9781589014015
• Topic: Politica e relazioni internazionali
• Subtopic: Affari pubblici e amministrazione

Economic individualism and market-based values dominate today's policymaking and public management circles—often at the expense of the common good. In his new book, Barry Bozeman demonstrates the continuing need for public interest theory in government. Public Values and Public Interest offers a direct theoretical challenge to the "utility of economic individualism, " the prevailing political theory in the western world.

The book's arguments are steeped in a practical and practicable theory that advances public interest as a viable and important measure in any analysis of policy or public administration. According to Bozeman, public interest theory offers a dynamic and flexible approach that easily adapts to changing situations and balances today's market-driven attitudes with the concepts of common good advocated by Aristotle, Saint Thomas Aquinas, John Locke, and John Dewey.

In constructing the case for adopting a new governmental paradigm based on what he terms "managing publicness, " Bozeman demonstrates why economic indices alone fail to adequately value social choice in many cases. He explores the implications of privatization of a wide array of governmental services—among them Social Security, defense, prisons, and water supplies. Bozeman constructs analyses from both perspectives in an extended study of genetically modified crops to compare the policy outcomes using different core values and questions the public value of engaging in the practice solely for the sake of cheaper food.

Thoughtful, challenging, and timely, Public Values and Public Interest shows how the quest for fairness can once again play a full part in public policy debates and public administration.

CHAPTER ONE
THE PRIVATIZATION OF PUBLIC VALUE

It is in vain to say that enlightened statesmen will be able to adjust these clashing interests, and render them all subservient to the public good.

—JAMES MADISON, The Federalist No. 10

No deliberation of politics and political theory claims a more venerable heritage than the dialogues on the existence, nature, and requirements of the “public interest” or the “common good.” In Aristotle’s Politics, the “common interest” (to koinei sympheron) is the rationale for proper constitutions; St. Thomas Aquinas in Summa Theologiae identifies the common good (bonum commune) as the worthy goal of government; Locke’s Second Treatise of Government declares that “the peace, safety, and public good of the people” are the transcendent political purposes.

We need not go back hundreds of years to find interest in public interest theory. In the early years of the twentieth century, many prominent political scientists paid homage to the idea of the public interest. Pendleton Herring’s (1936) reconciliation theory was premised on public managers’ ability to divine the common good; Emmette Redford (1954) viewed the public interest as the key to effective regulatory administration; Phillip Monypenny (1953) anchored his public administration ethical code in a concept of the public interest. Even the foundation stone of American public administration, Woodrow Wilson’s (1955) Study of Administration, originally published in 1887, set its famous politics/administration dichotomy in a concept of the collective good (Rutgers 1997).

Nowadays, many sophisticates’ reaction to public interest appeals is much the same as nonbelievers’ responses to discussions of God and the afterlife: nervous embarrassment tempered by a faint hope for some alternative to the void. How did this happen? The reasons for a decline in public interest argument and theorizing are many and varied. Social and academic fashion seems to have played a role. The development of quantitative social sciences and its inexhaustible demand for empirical evidence lessened our patience for topics that seem to hold little possibility of precise answers. The harshest critics of public interest theory rail loudest about its ambiguities and a seeming inability to determine when and if public interest theory has progressed.

Today, concern with the public interest has not disappeared, but public interest theory strikes many as an anachronism, a relic from another day’s Zeitgeist when the public interest was a preoccupation of celebrity intellectuals such as Walter Lippman (e.g., 1955). Public interest theory seems at odds with the pace, demands, and give-and-take of today’s public policy and management. Public interest theory seems out of place in polities dominated by fractious, interest group–based politics. What could public interest theory possibly say about policy domains rife with technical complexity and requiring teams of highly educated experts just to describe problems? And who could even think about solving a policy problem or “administering in the public interest” now that we know almost all problems have multiple, competing stakeholders seeking to maximize conflicting values?

The unpopularity of public interest theory is not entirely a product of contemporary cynicism. Scholars began to beat a hasty retreat in the 1950s. In the political science of the mid-twentieth century, the rise of quantitative and “behavioral” approaches and a focus on pluralism and politics as interest group behavior made discussions of the public interest seem passé and, worse, “metaphysical and unscientific.” Critics assailed the public interest as unrealistic, impractical, imprecise, ambiguous, devoid of meaning, and even as the handmaiden to authoritarianism. In perhaps the best-known criticism of public interest theory, Glendon Schubert (1961, 348) observed that political realists “have put behind them childish myths which postulate any independent substantive content for such notions as ‘the public will’ and the ‘public interest.’” Similarly, Frank Sorauf (1957, 638) concluded that “public interest theories … perpetuate a number of fables about the political process and contribute to the low prestige and esteem generally accorded to partisan political activity.” In their standard-setting public administration textbook, Simon, Smithburg, and Thompson (1950, 551) devoted less than a page to the public interest, dismissing it as simply a rationale for one’s private view of the world: “When one looks in a mirror, one sees one’s own image. Responsiveness to public interest, so defined, is responsiveness to one’s own values and attitudes toward social problems.”

Ironically, the success of some modern governments may have contributed to a diminished interest in deliberations about the public interest. Whereas in past centuries the idea of the public interest was set against despotic governments and tyrants, many modern nations have managed to develop governments that more often act as a bulwark against tyranny than as a perpetrator. As societies and governments succeed in rendering life less fearful and capricious, social stability and predictability settle in. This stability enables and supports economies. As fully articulated economies develop, individuals begin to focus less on collective security and more on wealth accumulation. At the same time, societies previously focused on combating tyranny and attending to social and political fissures have the luxury of focusing on economic development and efficiency.

In contrast to public interest theory, economic individualism, with its emphasis on individual liberty and each person’s role as a producer and consumer, has in recent decades grown in its influence. The emphasis on economic individualism (a concept described in detail later) is certainly not a new one in the United States or, indeed, in most nations with monetary systems and legal codes for property rights. Since its inception, the United States has provided fertile ground for market-based philosophies of human behavior and public policy. However, in recent times, market values have been elevated to a normative level perhaps unsurpassed in U.S. history. With China and Russia opening massive new markets and each being enamored of quasimarket approaches to policy and public management, there are nearly 2 billion people affected deeply by market criteria and norms who were only two decades ago largely and forcibly inured to them. Even the bastions of social and public values—Western European nations—have increasingly come to grips with market values, especially in the face of increasing financial burdens on the welfare state. Few outposts remain where policymakers confidently reject economic efficiency and growth as transcendent goals of public policy and its management.

Understandably, in our daily lives we more often attend to the practical embodiments of economic individualism than to its philosophical bases. But economic individualism is a set of ideas with a long, distinguished pedigree. Indeed, if we consider together economic individualism, public interest and public values, and, at least equally important, religion, then we have covered most of the terrain on which governments are built.

Due to the need to maintain some focus, this book does not give much emphasis to religious values, but in many cases religious values prove an even stronger competitor to secular public values than does economic individualism. To some extent, public values and economic values are commensurate. Both public values reasoning and economic reasoning are rooted more in analytical traditions. While there is certainly much analysis devoted to religion, it seems indisputable that faith necessarily plays a qualitatively different role in religion, even compared to the strong ideologies often produced through political and economic reasoning and argument. For these reasons, religious values receive limited attention here.

I consider in the following sections some of the philosophical foundations of economic individualism, a topic treated more comprehensively in chapter 3.

THE PHILOSOPHICAL FOUNDATIONS OF “ECONOMIC INDIVIDUALISM”

The definition of economic individualism is implicit in the two words of the term, and it can be defined it as “a philosophy emphasizing in matters economic the values and interests of the individual.” Because definitions including the same terms on each side of the equation are not sufficiently edifying, let me elaborate. As a philosophy, economic individualism is based on three central principles. First, it is human centered. Values are based on the needs of humans, not society. Second, social and government institutions are, at best, a means to satisfying individual needs. If they do not satisfy individual needs (but focus on community needs, ideals, or transcendent values such as God or the state), they are inimical to individualism. The third premise is that the individual is of supreme value, not the society or the polity, and that all individuals are of equal moral value. Individualism assumes that the best society is one that permits the individual maximum freedom of choice, that each person is the best judge of his or her interests, and that there is no transitivity of interests. Society, then, is seen as a collection of self-contained individuals, with government as a means of providing for those few values that enable individual expression, including education, defense and security, and enforcement of contracts voluntarily entered.

We have all heard the best-known maxim of economic individualism, “the government that governs least governs best.” The philosophy of economic individualism bears close kinship to classical liberalism and to libertarianism, stressing unfettered self-interest and implying that societies in which individuals pursue aggressively their unrestrained self-interest will best serve aggregate needs and desires.

Interestingly, the term individualism (as in political and economic individualism) was introduced by Alexis de Tocqueville (1965), the eighteenthcentury French political philosopher who became the iconic observer of American society and political culture. Tocqueville described economic individualism as a philosophy of moderated selfishness in which one favors oneself and perhaps a small set of family and friends.

While individualism seems to have had its strongest roots in the United States, it emerged as a philosophy in England, spurred by the ideas of political economist Adam Smith and political philosopher Jeremy Bentham. Smith’s doctrine of laissez-faire, based on the conviction that there is a “natural harmony of individual wills,” is the strongest economic embodiment of individualism. Smith’s “obvious and simple system of natural liberty” conceptualized competitive markets as the ideal system for achieving mutual advantage. A free market is the means by which to “maximize efficiency as well as freedom, secure for each participant the largest yield from his resources to be had without injury to others, and achieve a just distribution, meaning a sharing of the social product in proportion to individual contributions” (Smith 1976, 231–32).

In political philosophy, Bentham’s utilitarianism, especially its principle of “each to count for one and none for more than one,” articulates and codifies individualistic values. It is the foundation for one of the best-known approaches to public interest philosophy, an approach quite in harmony with economic individualism. While utilitarianism is compatible with many of the premises of economic individualism, it is important to note that utilitarianism is not coterminous with economic individualism, and indeed, it has led to some political outcomes clearly violating the maxim “the government that governs least governs best.” The philosophy of utilitarianism, at least as initially espoused by Bentham, includes considerations of justice and equity. Indeed, utilitarianism was cited as a rationale for some of the earliest social policies in Great Britain, including the elimination of child labor, usury, and prison abuse (Piven and Cloward 1971). These are not, of course, the uses to which contemporary neoclassical economic thinkers have put utilitarianism.

MANIFESTATIONS OF ECONOMIC INDIVIDUALISM

In an era increasingly influenced by a philosophy of economic individualism, public leaders and the public at large oftentimes look first to markets for solutions and then to government and nonmarket institutions only in those instances where market approaches seem unworkable. Indeed, that is the exact prescription of “market failure theory.” Market failure theory prescribes use of markets, not government or other organizing principles, unless the efficiency of markets has been undermined by such factors as monopoly, poor information to consumers, or the inability for providers of goods and services to protect against “free riders” (those who benefit from a good or service but do not for one reason or another pay for it).

Market failure theory receives considerable attention in chapter 3. For now, suffice it to note that market failure reasoning is a practical embodiment of the philosophy of economic individualism and that the theory treats government as a residual or a provider of last resort. That is, government should intervene only when we can identify some structural flaw in the market (e.g., monopoly, inability to set efficient prices) that undermines the ability of the private sector to provide needed goods and services.

Related to market failure reasoning is the idea that marketlike approaches are often the most useful way for governments to provide goods and services. In chapter 2 we review in some detail a few noteworthy manifestations of market-based policies, but let us consider just a few of the categories of approaches here.

Before the 1980s and the rise of the Reagan Revolution and Thatcherism, policymaking and public management were more often thought of as something done by governments. But in the past few decades, market-based governance mechanisms have proliferated. Following is a brief list of the market-oriented approaches to public policy and management:

• sale of public assets to private parties (Walker 1994);

• privatization and contracting out (Donahue 1991; Savas 2000);

• policies based on vouchers or saleable credits (Hausker 1992);

• tax credits (Bucy 1985);

• creation of hybrid organizations, part public and part private (Emmert and Crow 1988);

• managed competition (Marquis and Long 1999; Trubac 1995);

• government management of contractors (Hefetz and Warner 2004; Domberger and Jensen 1997; Hisrch 1995); and

• contractor management of government (Bozeman and Wilson 2004).

Market efficiency serves both as rationale for delivery of goods and services and as a rallying cry for businesslike, entrepreneurial, or market savvy government (Osborne and Plastrik 1997). As a result of changes in traditional assumptions about providers of goods and services, the very meaning of “publicness” (Bozeman 1987; Antonsen and Jørgensen 1997) is changing. On the one hand, public agencies strive to be more businesslike with such practices as managed competition and fee-for-services. On the other hand, private corporations increasingly perform public responsibilities (Kettl 1993; Rainey 2003). One cannot always identify the economic individualism bases of public policy and management simply by examining their rhetoric or surface rationales (Boyne 2006; Kelly 2005). Quite often, public policies rooted in economic individualism are promoted with the softer rhetoric of public value, progressivism, or populism. An obvious recent case is the rhetoric of “compassionate conservatism,” which argues that conservatism and compassion together are the best methods for solving social problems. In the United States, compassionate conservatives cite immoral behavior and original sin as the root cause of social problems, leading them to propose policies based on religious values, traditional families, and individual responsibility. One apparent consequence of this approach, when taken up by candidates, was to broaden their appeal to women voters (Hutchings et al. 2004).

Many noteworthy instances of soft rhetoric and liberal mythology blunting the reality of economic individualism can be found in U.S. tax policy. In theory, income taxation is based on progressive principles. However, if one examines actual tax burdens, especially in light of recent massive revisions during President George Bush’s first term (2000–2004), one would be hard-pressed to argue that U.S. taxes are redistributive in their nature. If we consider the actual percentage of wealth and income taxed for persons at different economic strata, the relaxation of dividends taxes, and especially the repeal of inheritance taxes, one might well conclude that the U.S. tax code is set up to either put brakes on or reverse the welfare state.

To some extent, the creation of the welfare state can be viewed as a repudiation of economic individualism, based on assumptions that are at odds with individualism: social achievement, a community of interests, social as well as economic interdependence, and most divergent, redistribution of wealth and resources to provide a social “safety net.” In the United States, the welfare state was never as extensive as in most European countries. Economic individualism, while it has waxed and waned in importance in the United States, has during most eras of the nation’s history been in the foreground of public policy deliberations and decisions.

The past decade’s “welfare reform” policies in the United States and Western Europe (Offerman 1999) have used a variety of soft rhetorical covers, including egalitarianism (Boleyn-Fitzgerald 1999), to deliver a reformulated welfare state in which subsistence is no longer an entitlement but a right to be earned by the individual. While the jury is still out on the effectiveness of these so-called reforms on poverty abatement and economic opportunity (Mead 2004; Slack et al. 2003; Rose 2000), the new policies have clearly shifted the fundamental assumptions about welfare and welfare rights (Stoesz 1999).

As nations strive to apply scarce resources in an effort to meet the needs and rising expectations of citizens, it is no surprise that policy models based on ideas of scarcity come increasingly to the fore. As I discuss in chapter 4, the managerial reform known as the “New Public Management” (see Barzelay 2001 for a detailed description and theoretical analysis) has to some extent codified and prescribed governance approaches based on economic individualism and market mechanisms. That chapter also examines the older and more targeted concept, privatization, and the values implicit in its approaches. Unquestionably, markets and market-based policymaking do, indeed, provide a great many advantages and have important roles to play in public policy and management. However, to the extent that public values and public interest are crowded out, some rethinking, adjustment, and recalibration seems in order. This book seeks to provide a counterbalance to both the philosophical and the more practical aspects of economic individualism. The practical prescription “managing publicness,” provided in the concluding chapter, is an alternative to privatization and New Public Management. Managing publicness takes public values as its starting point and public interest ideals as its objective. The philosophical prescriptions include a pragmatic approach to public interest theory as well as a model for understanding public values criteria. Why is it usef...