They Win, Part Three: Institutions, Not Ideology, Dominate Our World

In part one of this series, we noted that “They” – that is, powerful institutions existing beyond familiar forms of accountability – were winning their fights. These institutions were winning, we observed, not in the open court of public opinion, but rather in the paneled recesses of the legal system and the regulatory bureaucracy; even politicians were often excluded from the process. And so, for example, Comcast’s acquisition of Time-Warner Cable – unpopular as it might be with the citizenry – is nevertheless deemed to be inevitable.

In part two, we recalled the work of journalist James Burnham, who, more than 70 years ago, described the rise of a new worldwide managerial elite. These managers, Burnham believed, were the inevitable victors, destined forever to dominate the complex and opaque institutional systems that they themselves had created. Yes, the managers might squabble among themselves, and even go to war, but in the end, since they had more in common than in difference, the victorious system would be… managerial. That was Burnham’s point: The managers will always win.

Today, much of our world does, indeed, seem to be shaped and determined by unaccountable institutions, public and private, and the unaccountable institutionalists who run them. Yet most of the time, the power of these institutions goes unquestioned by the public at large; that is, managerial power – public, private, public/private – is so pervasive that it is simply assumed to be the natural and inevitable order of things. This seeming naturalness and inevitability is, in fact, the victory of an ideology – the managerial ideology.

Yet we might step back and ask: Should governments grow endlessly bigger? Should corporations – including those that enjoy favored regulatory status as monopolies or near-monopolies – also grow and grow? And how about the interconnections between public and private institutions? Should those connections get stronger as the years go by? If it seems simply inevitable that these institutions should grow bigger and more intertwined – well, maybe, it’s actually not inevitable.

In truth, the rise of managerial institutions, for good or for ill, did not come about spontaneously; their ascendancy came from a series of choices, whether or not Americans realized it along the way. Yet once the choices had been made, they might have seemed permanent and immovable. That’s the power of precedent – the feeling that if it once was a good idea, then it must always be a good idea. And of course, those who benefit from the status quo love such thinking, telling the public, in effect, “Set it and forget it.”

So in this third and last installment, we will consider some examples of how this kind of quiet institutional power is now playing out – perhaps to our benefit, perhaps to our detriment.

To start, we can return to Burnham, whose 1941 book The Managerial Revolution described the process by which institutions reinforce themselves by creating an ideology that in turn helps sustain those institutions. This ideology may ostensibly be “left” or “right,” but its chief virtue, in the minds of its advocates, is that it bolsters the rule of the managerial system. As Burnham explained:

All organized societies are cemented together, not merely by force and the threat of force, and by established patterns of institutional behavior, but also by accepted ways of feeling and thinking and talking and looking at the world, by ideologies. No one today will deny the crucial social function of ideologies, though we are always more critical about others’ ideologies than about our own. Indeed, many of us like to feel ourselves free from the influence of any ideology, though we are seldom prepared to grant such enlightenment to anyone else. A society cannot hold together unless there is a fairly general acceptance on the part of most of its members, not necessarily of the same ideology, but, at any rate, of ideologies which develop out of similar root concepts as starting points.

In other words, if the managers can persuade the public to accept the managerial ideology, then their work is mostly done. As Burnham described this process of ideologizing, “It is more than a problem of skillful propaganda technique. A successful ideology has got to seem to the masses, in however confused a way, actually to express some of their own interests.” And so, or example, if the managers can stake a claim to “the public interest,” they have made a huge gain. After all, how can the public oppose the public interest?

We might immediately note that any given ideology can be good or bad. What matters is that at the right moment, a critical mass of people bought into that ideology. Indeed, it can be a long time before the public notices that its interests aren’t necessarily being served by the hegemonic managerial arrangement.

And of course, inside the institution, as they actually do their work, the managers do not often spout the ideology of Marx, or Hayek, or any other public philosopher or economist. Instead, in their actual meetings, in their actual planning sessions, they speak in the language of managerialism – getting things done, problem-solving, bigger budgets, and so on.

And yes, of course, human foibles have a way of working themselves into the process; the bureaucratic desire for tidiness, for example, can become an unhealthy collective obsession to eliminate dissent.

Once again, we might note that the subject being deliberated could be anything from running a regulatory agency to running a death camp; Burnham’s whole point is that managerialism is the common denominator. And management imposes a sameness of form and format, even if the the underlying topics are profoundly divergent. Whatever the issue might be, managers manage – it’s what they do.

In other words, there’s the public ideology of ritualized incantation, and there’s the private ideology of operation – focused on performance, metrics, personnel. Burnham’s insight was to focus on the ideology of operation and to note its similarity in government and corporate office buildings around the world.

Some examples: The systems we have put in place to enhance national security, pharmaceutical safety, and fiscal probity. Few would argue against the basic idea of such systems, and yet there is room for debate. The debate comes over exactly how these systems might operate. In other words, it’s perfectly possible for them to be seen as both scary and necessary – at the same time.

In addition, each system requires a high degree of expertise; it takes trained technocrats to run such an operation. The challenge, then, is to manage them properly. And of course, once we concede the point that they need to be managed – well, here come the managers.

So let’s consider three three-letter examples from today’s era:

First, the National Security Administration (NSA). By now we are all familiar with Edward Snowden’s revelations. And we can all have our own opinion on Snowden – traitor? hero? a little bit of both? What’s readily evident, though, is that the NSA and its surveillance program isn’t going away, no matter who is elected to Congress this year or to the White House in 2016. Part of the reason, of course, is that all the information is there, on the network, waiting to be plucked. That is, if the NSA isn’t perusing our phone calls and emails, then Google is looking at them, or the Chinese – or some hacker. So who to trust with such surveillance power? Who will guard the guardians? These are eternal questions, made all the more pertinent by the instant accessibility of all our data.

Second, the Food and Drug Administration (FDA). Since the enactment of the Pure Food and Drug Act in 1906, the FDA has been protecting, or so it says, the health and safety of the American people. And while the FDA has done its share of good over the last century, it has also grown increasingly resistant to medical innovation and progress.

As The Wall Street Journal editorialized Monday, the FDA is opposing a new drug, pirfenidone, which was approved by the Japanese government in 2008, the European Union in 2011, and Canada in 2012. Yet not in the US. As the Journal editorial declares:

Government power can ruin fortunes, reputations and businesses, but at least the targets usually escape with their lives. Not so with the Food and Drug Administration, whose culture of political control is often lethal. This reality is all too familiar for the 200,000 or so Americans suffering from a terminal lung disorder as they wait, and wait, and wait for the FDA to approve a good drug that can slow the progression of their disease.

So why does the FDA behave like this? What’s the motivation? The Journal offered its cynical answer: “FDA headquarters rejected the drug simply as a show of its authority to command all drug development.” Longtime observers in DC, to be sure, never underestimate the power of bureaucratic pique and the desire to stake out institutional turf.

Another possible explanation for the FDA’s “just say no” attitude is the pressure on the agency from other federal agencies to “control costs” by withholding approval of potentially expensive new drugs. And why would the FDA cooperate like that? Here we can espy the power of a larger ideology guiding institutional behavior: In Washington DC today, the dominant dogma of healthcare is “bending the cost curve” on healthcare costs – that is, reducing them, or at least reducing their rate of growth.

As an aside, when bureaucrats decide to save money, it’s important to watch closely how they do it. One easy way for the healthcare system to scrimp is simply to offer fewer drugs to patients; after all, drugs are expensive, and so if the FDA doesn’t approve as many of them, there’s less cost to cover. And if patients die as a result? Well, in the neverland of government fiscal accounting, death is not deemed as a healthcare cost. Healthcare is expensive, but death is cheap – no more outlays for care. Yes, there’re costs to the overall economy in lost wages and wealth, but for whatever reason, those costs are not booked against the healthcare system. We can say that healthcare policy would be much different if the managers stood to gain as much from health as they now stand to gain from death.

As a third item, we come to perhaps the most powerful federal agency in the cost-control space, the Congressional Budget Office (CBO). The Office of Management and Budget, which reports to the President, might get more attention, but CBO is more powerful because its assessment, or “score,” for every piece of existing policy and proposed legislation is deemed, inside the Beltway, to be sturdily authoritative.

In other words, CBO wields real power when it can score a program as a big outlay, or as a small outlay, or – best of all – as a revenue raiser.

Yet for all its power, CBO is curiously myopic; as a matter of policy, it scores only the cost of a bill, not its benefits. As Zachary Karabell, writing in The Washington Post, put it recently, “The current framework is incapable of assessing the savings and other potential benefits of certain types of spending.” And so, for example, if CBO had been around in the 1950s, when President Eisenhower launched the Interstate Highway system, the score on that massive – and massively beneficial – infrastructure program would have been all a matter of costs, not benefits. As Karabell writes, the headline would have read, “President’s bill would add billions to deficits.”

Karabell extends the same costs-but-not-benefits point to other federal programs, including “medical and scientific breakthroughs from the National Science Foundation and the National Institutes of Health; the commercial applications of defense spending, including the Internet.” As the author concludes, “The positive consequences for our world today are manifest. And none of those could survive the scoring system we have today.” Improvements, benefits, and upsides, in other words, would not count at all.

Does CBO’s methodology serve the nation? Does it make any sense? It doesn’t matter: CBO rules. Indeed, CBO’s authority is so great that few in DC officialdom even talk about trying to change it. Now that’s the power of managerialism – when even elected officials quail at the thought of challenging the actions of un-elected officials. Burnham would be proud.

The lesson of NSA, FDA, and CBO is that managerial institutions can determine our national fate – even if few of us know what they truly do, and none of us have ever voted for them.

So do we conclude with the thought that, once again, "They Win?" Is this embedded system – sometimes referred to as the “deep state” – with us forever? Is it with us, whether we like it or not?

Okay, so suppose, say, a reader of Breitbart News doesn’t like the idea that these agencies – none of them, of course, are mentioned in the Constitution – have gained so much power. So what to do? How to counteract? How, even, to abolish or overthrow?

Those are hard questions, to be sure, although we should always remember: In the end, every human system can be changed by humans. So that’s the real question: How do we make desired change? Stay tuned: I’ll be returning to this topic, trying to provide some answers from time to time. In the meantime, it’s best to pay attention to what They are doing—because They are paying close attention to what you do.


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