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Context, Leadership and Change: the case of the US Government Shutdown

 

October 2, 2013

Doug Hadden, VP Products

How could this happen? This epic dysfunction demonstrated by the American politicians resulting in shutting down all non-essential services of the US federal government.

Professor Matt Andrews of the Harvard Kennedy School has put out an interesting thought piece proposing a research methodology on how governments get great. Maybe we should consider how governments become dysfunctional. In this case, how the politics of the most powerful country in the world has become as dysfunctional as a “fragile state”.

Institutional Structures and Arrangements

Andrews has suggested that we consider two explanations for how governments become great, ‘Solution and leader driven change’ (sldc) and ‘Problem driven iterative adaptation’ (pdia). There has been a tendency for experts, may representing multi-lateral donors, to suggest structural solutions to problems. Add an “anti-corruption” institution and adopt some “best practices” and positive outcomes were surely come. (Perhaps, the ‘Field of Dreams” theory of development.)

This situation shows us how institutional arrangements conspire to prevent good governance.

In the Westminster system as operated in Canada, for example, failure to pass a budget is effectively considered a point of confidence and the government falls. And, there is an election. The opposition had better be confident that they have the people on their side, otherwise they will lose seats. (There can be issues in bicameral parliaments when one house does not have priority over the other – but the Head of State can pick someone else to be Prime Minister.)

When Checks and Balances lead to Dysfunction

The American system operates on a system of “checks and balances” with three branches of government, the executive, the legislative and the judiciary. This, and other structural factors, have enables the deadlock that we see today in the United States:

  • Single past the post electoral methods restrict the number of popular political parties. (In the US to 2. In Commonwealth countries, 2 + some third parties). In the US, this combines with the Electoral College method for President, the difficulty registering candidates outside main parties, the control of the two parties over debates and the attrition method of “primaries” to support the idea that there are only two parties and, generally, two points of view.  This creates a structural arrangement that more easily supports polarization. (And, for observers from other countries, the differences between the Democratic and Republican parties seem rather nuanced compared to the breadth of political views that they experience.)
  • Separation of the legislature from the executive creates an artificial divide. Cabinet ministers are not elected. (They must resign their seat if they are.) The notion in the US is that Congress is able to balance executive power through oversight. Both houses are focused on the push-and-pull of political wrangling. And, these members are perfectly free to vote for and against the wishes of the President from their party. Of course, the majority in either house can be from the “opposition” party. This can create an “us and them” view where the legislature and executive structure supports animosity.
  • The United States operates with a bicameral legislature, the House of Representatives based on representation by population and the Senate, based on two members per State. Any law must be passed by both houses and approved by the President or not vetoed. There is no supremacy of one house over the other, as there is in the UK where the House of Commons can override the House of Lords. And, both houses in the US can have completely different bills on the same subject that needs to be rationalized. This creates friction between the two houses that combines with the friction with the White House.
  • The budget process in the American government is normally expected to take two years. Like most countries, the draft budget is created through the central agency and government ministries, departments and agencies. This budget is presented to the legislature. In the United States, the original budget from the Office of Management and Budget (OMB) is presented to Congress. Congress has an additional year to adapt this budget. Most developed countries require a year or less from initial budget work to passing into law. The American system assumes 2 years for this. And, in this situation, Congress has not passed a budget for years. Rather, Congress passes Continuing Resolutions (CRs) to keep the government funded. This is not unusual in many countries. What is unusual is the ability to continually pass (or not) CRs rather than address the budget proposed by the government. Congress has mechanisms to avoid laws proposed by the executive.
  • Election funding laws with Political Action Committees (PACs) and SuperPACs makes fundraising a necessity for holding federal office. The cost for winning elections is significant. The use of earmarks as an institutional mechanism creates a structural environment for lobbying.  This is a perverse incentive, in the structure, that encourages the support of vested interests. (Some would consider this institutionalized corruption.

This institutional environment in the United States encourages polarization and the use of manoeuvers for political gain regardless of impact on citizens. It encourages zero sum gain gaming.

It’s remarkable that in a country with so many political cleavages (rich/poor, racial, religious, north/south, east/west, urban/rural) that such strong polarization can occur.

Myths and Good Governance

The political polarization in the United States relies on supporting national myths. Americans are quick to speculate on what the intent of the “founding fathers.”  The American constitution has taken on mythical qualities. And, there is the persistent myth of “American Exceptionalism.” I’m not referring to myth as having no basis in fact or history. Countries have strong national myths with powerful narratives. This can bind people on one hand, but prevent needed change on the other.

Both sides in the current American debate claim that the other lacks “leadership” (an sldc problem). Neither side seems to be arguing that the healthcare issue at hand in complex (a pdia problem). The reality is that the national myths combine with the institutional arrangements to augment dysfunction:

  • Notions of American Exceptionalism creates an environment where what policy seems to work in another country mustn’t be working and will never be as good as what Americans come up with.
  • Founding fathers designed a relatively weak federal government on purpose with a focus on individual liberties over collective or utilitarian benefits.
  • The Constitution is somehow a more powerful legal instrument than any other law, despite numerous amendments.

Context is everything in governance. It is unlikely that we will witness structural changes in the way institutions operate in the United States at the federal level. It is a reminder of how we shouldn’t transport our views on governance structures to other countries – we need to understand the contextual advantages and constraints.

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Doug Hadden

Doug Hadden

Executive Vice President, Innovation at FreeBalance
Doug is responsible for identifying new global markets, new technologies and trends, and new and enhanced internal processes. Doug leads a cross-functional international team that is responsible for developing product prototypes and innovative go-to-market strategies.

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