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Full text of "Elements Of Public Administration"

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ELEMENTS 

OF 





ministration 



JAMES W. FESLER FRITZ MORSTEIN MARX 

GEORGE A. GRAHAM DON K. PRICE 

V. O. KEY, JR. HENRY REINING, JR. 

AVERY LEISERSON WALLACE S. SAYRE 

MILTON M. MANDELL DONALD C. STONE 

HARVEY C. MANSFIELD JOHN A. VIEG 

JOHN D. MILLETT DWIGHT WALDO 



Edited By 

FRITZ MORSTEIN MARX 



NEW YORK 
PRENTICE - HALL - INC. 



Copyright, 1946, by 

PRENTICE-HALL, INC. 

70 Fifth Avenue, New Yor/< 

All rights reserved. No part of this boot^ may be 

reprinted in any form, by mimeograph or any 

other means, without permission in writing from 

the publishers. 



First printing November, 1946 
Siioml punting .. Fcbnun, l ( H7 
Third printing NoM-rnher, 1^48 
Fourth printing November, 1949 



PRINTED IN* THK UNITFD STATFS OF AMERICA 



TO 

OUR STUDENTS 
PERPETUAL PROMPTERS OF THOUGHT 



Preface 



THIS book is a testimonial to its publisher's persistence. Idle minds 
have always liked to toy with ideas for books that "ought to be written." 
However alluring any such plan, its author is apt to consider it highly 
unfair to be burdened with its execution. The editor could have done 
wonders with his lawn had he managed to cling to the role of the 
gratuitous book-planner. For better or for worse, the publisher prodded 
him into a more exacting job. 

This book is also a demonstration of teamwork. The fourteen men 
who came together to form the team discovered that they thought very 
much alike about the field of interest they had in common. When they 
joined forces, all of them were engaged in the practical business of public 
administration; all of them were under the influence of fresh experience; 
and all of them were stimulated by new insights that open up to those 
placed strategically within the administrative structure. 

These exceptional circumstances held forth the promise of a unified 
and systematic treatment of the subject rather than a symposium made up 
of unconnected essays. In the exchange of views among the members of 
the team, the preliminary plan grew into an integrated enterprise to 
which each member contributed his carefully defined share. Throughout 
the writing of the book, its character as a combined operation was sus- 
tained by the team spirit of each participant. 

The principal aim of the book is to deepen the reader's understand- 
ing of the administrative process as an integral phase of contemporary 
civilization. In a sense, therefore, this is a broadly political rather than 
merely technical study. Its focus is on the fundamental problems of 
public administration the problems that assert themselves at countless 
points within the framework of governmental effort. The analysis here 
presented attempts to explore both the range of controlling institutional 
factors and the variables of administrative behavior. 

The aim of the book compelled an approach appropriate to it. A 
glance at the table of contents will show that the customary division of 
the subject matter has been modified in several important respects. There 
is also a deliberate recurrence of basic themes, each being developed in 
progressive specificity as the discussion moves forward. One of these 
basic themes inevitably runs through the entire volume that of the im- 



viii PREFACE 

plications of democratic governance for public management in all of its 
ramifications. 

Many good friends have been generous enough to support the team 
at various junctures with sound counsel and welcome assistance. To name 
them all would make a long list. The editor is particularly grateful for 
the unfailing help rendered him by his secretary, Raye R. Schwciger. 
Mary Friedrich and Betty I. Bleichncr of the reference staff of the Library 
of the United States Bureau of the Budget have given liberally of their 
bibliographical knowledge. The distinguished record officer of the same 
agency, Helen L. Chatficld, as an act of supererogation turned herself 
into a painstaking proofreader. All these expressions of sympathetic 
interest are sincerely appreciated. 

FRITZ MORSTEIN MARX 
Washington, D. C. 



Introducing the Team 



James W. Fcsler, a former research fellow of the Brookings Institution and 
the Rockefeller Foundation, is protessor of political science at the University 
of North Carolina. In the federal government he has served on the staffs of 
the National Resources Committee, the President's Committee on Administrative 
Management, the Office of Production Management, the War Production Board, 
and the Civilian Production Administration. From 1941 to 1943 he was 
special assistant to the executive secretary of OPM and WPB; from 1943 to 
1946 he headed the Policy Analysis and Records Branch of WPB and later of 
CPA, combining with his duties during the last two years those of the War 
Production Board's historian. His main writings are Executive Management 
and the Federal Field Service (1937), one of the special studies sponsored by 
the President's Committee on Administrative Management; and The Independ- 
ence of State Regulatory Agencies (1942). 

George A. Graham, professor of politics at Princeton University, has also 
taught at the University of Illinois and at Monmouth College. He has been 
associated with the Detroit Bureau of Governmental Research and the Princeton 
Local Government Survey. In 1942 he joined the Administrative Management 
Division of the Bureau of the Budget, Executive Office of the President. In 
1943 he was made chief of the War Supply Section, and subsequently also served 
as head of the War Records Section. In 1945 he was placed in charge of the 
Government Organization Branch. His publications include Special Assess- 
ments in Detroit (1931); Pe sonnel Practices in Business and Governmental 
Organization (1935), one of the monographs of the Commission of Inquiry on 
Public Service Personnel; Education for Public Administration (1941); and Reg- 
ulatory Administration (1943), of which he was co-editor. 

V. O. Key, Jr., professor of political science at Johns Hopkins University, has 
been a staff member of the National Resources Planning Board and a con- 
sultant to the Social Security Board. In the immediate prewar period he also 
served as a member of the Baltimore Commission on Governmental Efficiency 
and Economy. During World War II he was associated with the Adminis- 
trative Management Division of the Bureau of the Budget, Executive Office 
of the President. I le is the author of The Administration of Federal Grants 
to States (1937) and Politics, Parties and Pressure Groups (1942); and co-author 
of The Initiative and the Referendum in California (1939). One of his more 
recent contributions to the periodicals of politics and public administration is 
"The Reconversion Pha^e of Demobilization," American Political Science Review, 
December, 1944. 

Avery Leiserson, of the political science faculty at the University of Chicago, 
has been a stafT member of the Labor Advisory Board of the National Indus- 
trial Recovery Admininration in the early New Deal period, and later a field 
examiner for the National Labor Relations Board. Subsequently he served as 
conference director of the School of Public and International Affairs at Princeton 



X INTRODUCING THE TEAM 

University, and as panel secretary to the National Defense Mediation Board. 
During World War II he was associated with the Administrative Management 
and Estimates divisions of the Bureau of the Budget, Executive Oifice of the 
President. His chief work is Administrative Regulation (1942), a study of the 
methods by which interest groups participate in the administrative process. 

Milton M. Mandcll is at present in charge of testing for administrative and 
managerial positions, a significant phase of the program of the United States 
Civil Service Commission. He was formerly lecturer in personnel administra- 
tion at New York University and the College of the City of New York. He 
has been a staff member of the municipal civil service commission in Los Angeles 
and the Tennessee Valley Authority; classification consultant to the State of 
Connecticut; personnel officer of the Materials Division of the War Production 
Board; and chief analyst with the President's Committee for Congested Produc- 
tion Areas. He is the co-author of Education and the Civil Service in New 
Yor^ City (1938), product of a study of public personnel administration which 
he supervised under auspices of New York University; and author of other 
contributions to public personnel administration. 

Harvey C. Mansfield currently serves as the historian of the Office of Price 
Administration. He was formerly assistant professor of government at Yale 
University, and has also taught at Stanford University. He was a member of 
the staff of the President's Committee on Administrative Management. In 1942 
he joined OPA as a principal administrative officer, and subsequently became asso- 
ciate price executive and price executive of the Consumer Durable Goods Branch. 
In 1945 he was appointed assistant director of the Consumer Goods Division of 
OPA. His principal publications are The La^e Cargo Coal Rate Controversy 
(1932); The General Accounting Office (1937), one of the special studies spon- 
sored by the President's Committee on Administrative Management; and The 
Comptroller General (1939). 

John D. Millett, associate professor of public administration at Columbia 
University, has also taught at Rutgers University. He has been a staff member of 
the President's Committee on Administrative Management; assistant secretary 
to the Committee on Public Administration of the Social Science Research Coun- 
cil; and special assistant to the Director of the National Resources Planning Board. 
In World War II he was commissioned a major in the United States Army, as- 
signed to the Control Division at headquarters of the Army Service Forces; he 
left the Army as a colonel. He is the author of The Worlds Progress Adminis- 
tration in New Yor^ City (1938) and The British Unemployment Assistance 
Board (1939); co-author of Federal Administrators (1939) and The Adminis- 
tration of Federal Wor\ Relief (1941). One of his latest contributions to pro- 
fessional journals is a study of the direction of supply activities in the War 
Department, published in the American Political Science Review, April and 
June, 1944. 

Fritz Morstein Marx, a research fellow of the Rockefeller Foundation in 
1930-1931, has taught at the Pennsylvania School of Social Work, Princeton 
University, New York University, Harvard University, Columbia University, 
Queens College, Yale University, and American University. Prior to his enlist- 
ment in the Army in 1942, he served as consultant to various local, state, and 
federal agencies. He has been engaged in research work for the Commission 
of Inquiry on Public Service Personnel, and was the first chairman of the Special 
Committee on Comparative Administration, sponsored by the Committee on 



INTRODUCING THE TEAM xi 

Public Administration of the Social Science Research Council. Since his return 
from the Army, he has worked in the Bureau of the Budget, Executive Office 
of the President, where he is currently employed as staff assistant in the Office 
of the Director. His writings include a study of judicial review under the 
Weimar Constitution (1927); Government in the Third Reich (rev. ed., 1937); 
and a series of papers on comparative administrative law. He is the editor of 
Public Management in the New Democracy (1940). 

Don K. Price, a Rhodes scholar in 1932, is associate director of the Public 
Administration Clearing House and lecturer in political science at the University 
of Chicago. He has served as a staff member of the Federal Home Loan Bank 
Board and the Central Housing Committee. More recently he has been attached 
to the Administrative Management Division of the Bureau of the Budget, Execu- 
tive Office of the President. During World War II he was a lieutenant in the 
United States Coast Guard Reserve, assigned to headquarters in Washington. 
He is co-author of City Manager Government in the United States (1939), a 
study undertaken for the Committee on Public Administration of the Social 
Science Research Council. He was the first managing editor of Public Admin- 
istration Review, to which he contributed a spirited exchange with Professor 
Harold J. Laski on the respective merits of presidential and cabinet government. 

Henry Reining, Jr., assistant to the executive director of the Port of New 
York Authority, previously was management consultant with Rogers & Slade in 
New York City, where he specialized in programs for the selection of prospec- 
tive executives. Before 1945 he served for ten years as the first educational 
director of the National Institute of Public Affairs in Washington, D. C., which 
has been singularly successful in sponsoring governmental internship programs 
for college graduates of high promise, and more recently for able federal em- 
ployees on an in-service basis; the latter program is now being conducted by the 
United States Civil Service Commission. Before assuming this position, he 
was a faculty member of Princeton University and research associate of the 
Princeton Local Government Survey. He has also taught at George Washington 
University, American University, and the University of Southern California, an 
institution that has pioneered in the field of government-employee training. He 
has been consultant to several federal agencies, and also to the National De- 
partment of Administration of the Public Service (DASP) in Brazil. He is 
the co-editor of Regulatory Administration (1943) and author of a number of 
articles in academic reviews. 

Wallace S. Sayre, personnel director of the Office of Price Administration, 
has recently been appointed professor of administration at the School of Business 
and Public Administration of Cornell University. He was formerly a member 
of the political science faculty of New York University. In 1937 he was ap- 
pointed secretary of the municipal civil service commission in New York City, 
and a year later became a member of the commission. Early in 1942 he entered 
the service of the Office of Price Administration as principal consultant to the 
Personnel Branch. Soon afterwards he was made assistant director of the Fuel 
Rationing Division; he assumed direction of OPA's personnel functions in 
1944. He is a consulting editor of the New York Legislative Service, and was 
a member of the group that drafted the Model Civil Service Law. His writings 
have been devoted to various aspects of American government and politics, in- 
cluding political biography and the role of the public service. He is co-author 
of Charter Revision for the City of New Yor^ (1934) and Education and the 
Civil Service in New Yor% City (1938). 



Xll INTRODUCING THE TEAM 

Donald C. Stone is assistant director in charge of administrative management 
in the Bureau of the Budget, Executive Office of the President a position he has 
occupied since 1939. He has played a prominent role in the field of govern- 
mental research, serving successively as a staff member of the Cincinnati Bureau 
of Governmental Research; assistant director for the Committee on Uniform 
Crime Records of the International Association of Chiefs of Police; staff member 
of the Institute of Public Administration in New York City; director of research 
of the International City Managers Association; and executive director of the 
Public Administration Service in Chicago. During these years he has also 
worked as a consultant to many federal agencies, including the Tennessee Valley 
Authority and the Social Security Board. As an officer of the Federal Gov- 
ernment, he has attended numerous international conferences, both as a member 
of the United States delegation and in an advisory capacity. Formerly asso- 
ciated with the University of Chicago and Syracuse University, he is now adjunct 
professor of public administration at American University. He is the author of 
The Management of Municipal Public Worths (1939) and other studies, most 
of which have appeared in professional periodicals. 

John A. Vieg, professor of government and chairman of his department at 
Pomona College, has taught at various institutions, including Iowa State College. 
He was research associate at the University of Chicago from 1934 to 1937. In 
1943 he became a staff member of the Administrative Management Division of 
the Bureau of the Budget, Executive Office of the President, where he dealt 
principally with matters of international administration. While on the faculty 
of Iowa State College, he also served as vice chairman of the city plan commission 
of Ames, and as vice chairman of the Story County Civilian Defense Council. He 
has written The Government of Education in Metropolitan Chicago (1939), 
and is co-author of City Manager Government in Seven Cities (1940), The 
Future of Government in America (1942), and Wartime Government in Opera- 
tion (1943). 

Dwight Waldo, formerly of Yale University, is a member of the political 
science department at the University of California in Berkeley. In 1942 he 
became a staff member of the Office of Price Administration, serving successively 
as an administrative assistant, assistant economist, anu price analyst. In 1945 
he transferred to the Administrative Management Division of the Bureau of 
the Budget, Executive Office of the President, where he devoted his time prin- 
cipally to organizational studies. His published writings, thus far confined to 
the learned reviews, have dealt with such seemingly disparate matters as social 
thought and public-service recruitment. His first book, an analysis of the theory 
of American public administration, is scheduled for early release. 



Contents 



CHAPTER PACK 

PREFACE vii 

INTRODUCING THE TEAM ix 



PARTI 
The Role of Public Administration 

1. THE GROWTH OF PUBLIC ADMINISTRATION, John A. Vieg 3 

1. ADMINISTRATION PUBLIC AND PRIVATE 3 

Administration as Part of All Planned Effort, 3; Unity of Scientific Knowledge 
of Administration, 4; Scope of Pub'ic Admmistr tion, 5; Elements of Public 
Administration, 6; Administration as Servant of Policy, 7. 

2. THE AMERICAN BACKGROUND 9 

Heritage from Britain, 9; Influence of the Frontier, 11; Hamiltoman and JefTer- 
soman Traditions, 12; Public Administration and the National Economy, 13; 
Assertion of the Public Interest, 14. 

3. THE EXPANSION OF GOVERNMENTAL FUNCTIONS 14 

American Pragmatism, 14; Limits to Government Nonintervention, 15; Estab- 
lishment of Clientele Departments, 16; Rise of Governmental Corporations, 17; 
Growth of Administrative Activities, 18. 

4. INCREASING COMPETENCE FOR INCREASING RESPONSIBILITIES 20 

Professional Versus Amateur, 20; Patronage and Economy, 22; Advances in 
Structure and Procedure, 23; Impact of Emergencies, 25; Tasks of Admin- 
istration in Mid-Century, 25. 

2. THE STUDY OF PUBLIC ADMINISTRATION, Avcry Leiserson 27 

T" V -N 

1 . THE WORK OF THE PIONEERS >. . .\ 27 

Beginnings of Administrative Research, 27; Wives of Governmental Reform, 
28; Organized Dissemination of Knowledge, 25; Role of Progressivism, 29; Con- 
tribution of the Universities, 30. 

2. THE ADVANCEMENT OF KNOWLEDGE 31 

Relativity of Efficiency, 31; Use of Outside Experts, 32; Challenge to Traditional 
Approach, 33; Rise of Administrative Self-Analysis, 34; Reaffirmation of the 
Political Context, 36. 

xiii 



XIV CONTENTS 

CHAPTER PAGE 

3. TRAINING FOR PUBLIC ADMINISTRATION ....................... 37 

Educational Aspects, 37; Contrast with Great Britain, 39; Post-Entry Training, 
40; Group Structure of the Public Service, 41; Higher Career Opportunities, 41. 

4. THE FRONTIERS OF RESEARCH ................................ 42 

Function Versus Structure, 42; Man in Organization, 43; Theory of Relation- 
ships, 44; Progressive Management, 46; Horizons of Administrative Research, 47. 

5. ADMINISTRATION ART OR SCIENCE? ......................... 48 

Aims of Scientific Approach, 48; Concerns of the Technician, 49; Science and 
Social Dynamics, 49; Evaluated Experimentation, 49; Alliance of Theory and 
Practice, 50. 

2* UREAUCRACY FACT AND FICTION, John A. Vteg ......... 51 

1. SEMANTICS AND REALITIES ................................... 51 

The Language of Contempt, 51; Officiousness and Frailty, 52; Administrative 
Self-Promotion, 52; Procedural Rigmarole, 54; Subjectivity and Objectivity, 55. 

2. THE SOURCES OF RED TAPE ................................. 55 

Red Tape and Green Tape, 56; Requirements of Efficiency, 56; Predictability 
of Performance, 57; Government of Laws, 57; Accountability to the Public, 57. 

3. THE CHARGE OF DESPOTISM ................................. 58 

Effects of the Industrial Age, 58; Charge of Usurpation, 59; Legislative Dele- 
gation, 60; Flexibility of Statutory Standards, 61; Quasi-Judicial Agencies, 61. 

4. THE BATTLE AGAINST REGIMENTATION ....................... 63 

Experience Abroad, 63, Parliamentary Review ot Delegated Legislation, 64; 
Ignoble Partisanship, 65, Matrix of a Mixed Economy, 65, Experimental Ac- 
commodation, 66. 

5. THE NEED FOR UNDERSTANDING ............................. 66 

Psychology of Public Emplo\nunt, 67, VYi! of Oliicial Anonymity, 68; Teams 
and Cogs, 69; Ethics of Political Counsel, 70; Fact Over Fiction, 70. 

4. DEMOCRATIC ADMINISTRATION, Don K. Price ........... 72 

1 . LEGISLATIVE-EXECUTIVE RELATIONSHIPS ....................... ?2 

Prophets of 111, 72, Dangers of Oversimplification, 74; Control by Delegation, 
75, Democracy and Legislative Supremacy, 76; Legislators Vc^us Legisla- 
tures, 77. 

2. THE PUBLIC AS STAR CUSTOMER ............................. 78 

Methods of Opinion Analysis, 78; Advisory Committees, 79; Day-by-Day 
Administrative Relationships, 79; Reporting to the Public, 80; Commissions of 
Inquiry, 80. 



3. PUBLIC ^PARTICIPATION ...................................... 

Cooperative Government, 81; Combined Operations Among Levels of Gov- 
ernment, 82; Benefits of Intergovernmental Collaboration, 84; Inclusion of 
Business and Labor, 85; Group Initiative Under National Standards, 86. 



CONTENTS XV 

CHAPTER PAGE 

4. REPRESENTING THE PUBLIC INTEREST 87 

Interdependence of Public and Private Interests, 87; Threefold Collaboration in 
Policy -Making, 88; Informality of Policy-Making/ Process, 89; Experimental 
Approach, 90; General Interest Over Special Interest, 90. 

5. DEPARTMENTAL DEMOCRACY 91 

Individual Freedom Versus Institutional Restraint, 97; Sense of General Pur- 
pose, 93; Vice of Departmentalism, 94; Inroads of Perfectionism, 95; Demo- 
cratic Self- Education, 96. 

5. THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION, 

Fritz Morstein Marx 98 

1. THE "AMERICAN SYSTEM" AND THE SERVICE STATE 98 

Wartime Rccurd, 98; Peacetime Relevance of Wartime Achievement, 98; Long- 
Range Trend Toward the Service State, 99; Assurance Versus Fear, 100; Test 
of the Service State, 100. 

2. THE NEEDS OF THE SERVICE STATE 101 

Making Democracy Succeed, 101; Continuity of Progress, 102; Surviving Con- 
tradictions, 103; Requirements of Public Management, 104; Requirements of 
Policy Planning, 105. 

3. PUBLIC ADMINISTRATION INSTRUMENT OF GOVERNMENT 106 

Prominence of Public Administration, 106; Demands on Legislative Leadership, 
106; Role of the Judicial Power, 107; Resources of Administration, 108; Admin- 
istration as a Fitting Process, 108. 

4. THE ENLISTMENT OF ADMINISTRATIVE JUDGMENT 108 

Legislative Marching Orders, 108; Political Feasibility of Policy, 709, Admin- 
istrative Feasibility of Policy, 110. Blending of Judgments, 110; Administra- 
tive Freedom of Expression, 111. 

5. THE CONTRIBUTION OF SERVICE Ill 

Popular Basis of Administrative Services, 111; Habit of Self-Restraint, 112; 
Governmental Reinforcement of the Enterprise Economy, 113, Benefits of Regu- 
lation, 113; Popular Accountability of Administration, 114. 

6. PUBLIC ADMINISTRATION SOCIAL BUFFER 114 

Fountains of Administrative Knowledge, 114, Government's Intelligence Func- 
tion, 114; Public Research and Analysis, 115; Getting at the Facts, 116; Con- 
cern for the Underdog, 776. 

PART II 
Organization and Management 

6. PLANNING AND ADMINISTRATION, John D. Milieu 121 

1. THE IMPORTANCE OF PLANNING 121 

Essence of Planning, 727; Contribution of Administrative Planning, 123; Plan- 
ning and Legislation, 124; Planning and Administration, 124; Interrelation of 
Planning Activities, 124. 



XVi CONTENTS 

CHAPTER PAGE 

2. THE MACHINERY FOR PLANNING 126 

Federal Improvisation, 126; Natural Resources Planning Board, 727; Office of 
War Mobilization and Reconversion, 128; New York City Planning Commis- 
sion, 128; Departmental Planning Units, 130. 

3. PLANNING VERSUS OPERATIONS 130 

Opportunities for Conflict, 1 30; Task of Progressive Management, 131; Plan- 
ners as Administrators, 131, Practical Test of Planning, 132; Planning Through 
Action Agencies, 133. 

4. THE REQUIREMENTS OF PLANNING 133 

Long-Range Versus Short-Range Planning, 133; Planning Personnel, 134; Plan- 
ning Techniques, 136, Public Relations of Planning, 138; Summary, 138. 

WORKING CONCEPTS OF ORGANIZATION, John D. Milieu. . 140 

1. THE ARCHITECTURE OF ORGANIZATION 140 - 

Terminology, 140. Bases of Organization, HI; Choice of Basis, H2; Dynamics 
and Rigidities, H3; Political Factors in Organization, 144. 

2. LINE AND STAFF (1 4y 

''Meaning of Line, H5; Meaning of Staff, 146; Staff Activities Inherent in Ad- 
ministration, 147; Ceritral Service Activities, 147; Functional and Operating 
Staff, 147. 

3. QUEST OF ORGANIZATIONAL UNITY 148 

Hierarchy and Span of Control, 148; Decentralization, 149; Unity of Com- 
mand, 150; Coordination, 752; Integration, 752. 

4. GUIDING RULES OF ORGANIZATIONAL DESIGN 153 

Need for Standards of Organization, 153; Insuring Sound Organization, 154; 
Summary, 756. 

fi. THE CHIEF EXECUTIVE, John A. Vieg 158 

1. DUAL FUNCTION: POLICY AND ADMINISTRATION 

Means and Ends, 158; Separation of Political Leadership and Administration, 
759; Combination of Political Leadership and Administration, 767. 

r2. LEADERSHIP AND AUTHORITY 162 

Cloak of Legal Power, 762; Personal Qual fications, 762; Mark of Leadership, 
164; Political and Administrative Talent, 765; American Presidents, l6; Crea- 
tive Policy Versus Sound Administration, 767; Business Leaders, 
ernors and Mayors, 168. 

3. EXTERNAL RELATIONSHIPS 169 

Relations with the Judiciary, 769; Relations with the Legislature, 170; Agency 
Contacts with Legislators, 777; Relations with Other Chief Executives, 777; 
Relations with Political Parties, 772; Puolic Opinion and Interest Groups, 772. 

4. INTERNAL DIRECTION AND CONTROL 174 

Administrative Planning and Direction, 774; Executive Coordination and Ad- 
ministrative Reporting, 174; Constitutional Supports, 775; Statutory Implemen- 
tation, 777. 




CONTENTS XVii 

CHAPTER PACE 

5. ARMS OF MODERN MANAGEMENT 178 

Need for Assistance to the President, 178; Realigning the Executive Branch, 
779; Central Staff Facilities, 180; Executive Office of the President, 181; Policy 
Coordination, 182; Potentialities of the Cabinet, 182. 

9. THE DEPARTMENTAL SYSTEM, Fritz Morstein Marx 184 

1. GENERAL FEATURES 184 

Purpose of Departmentalization, 184; Structure of Departmental System, 185; 
Factors in Departmentalization, 187; Undirected Growth, 189; Quasi-Depart- 
mcnts, 190. 

2. INTERDEPARTMENTAL COORDINATION 191 

Staff Establishments, 792; Coordinating Agencies, 193; Role of the Cabinet, 
195; Use of Interdepartmental Committees, 196; Avenues of Progress, 797. 

3. THE SECRETARY'S BUSINESS 198 

External Affairs, 198; Living in a Goldfish Bowl, 799; Character of Execu- 
tive Function, 200; Classes of Executive Aides, 201; Attaining an Institutional 
Product, 201. 

4. THE BUREAU PATTERN 202 

Special Concerns Versus General Purpose, 202; Centrifugal Pull, 203; Bureau 
Intransigence, 204, Weight of Professionalization on Bureau Level, 204; Re- 
affirming Unity of Purpose, 205. 

10. INDEPENDENT REGULATORY ESTABLISHMENTS, James W. 

Fesler 207 

1. TYPES OF INDEPENDENT ESTABLISHMENTS 207 

Meaning of Independence, 207; Institutional Safeguards of Independence, 209; 
Appointment and Removal of Members, 210; Financial Support and Basic Au- 
thority, 277; Political Factors, 271. 

2. NATURE AND CONDUCT OF REGULATORY BUSINESS 212 

Rule-Making and Case -by-Case Decision, 2/2; Administrative Approach, 274; 
Mixture of Approaches, 275; Judicial Control, 277; Proposals of Attorney Gen- 
eral's Committee on Administrative Procedure, 279. 

3. THE RECORD OF INDEPENDENCE 221 

Regulation by Independent Commissions and by Executive Departments, 227; 
Clifcntcle Departments and Directive Power, 222; Struggle for Control Over 
Independent Commissions, 22.?; Humphrey Case, 224; Experience in the States, 
226. 

4. THE PRICE OF INDEPENDENCE 227 

Popular Illusions, 227; Need for Policy Coordination, 228; Lethargy of Inde- 
pendence, 228; Pressure for Reform, 229; Lack of Stimulation, 229. 

5. ORGANIZATIONAL ALTERNATIVES 230 

Executive Control, 231; Legislative Control, 231; Judicial Control, 232; Segre- 
gation of Powers of Independent Commissions, 233; Proposals of President's 
Committee on Administrative Management, 234. 



XVlii CONTENTS 

CHAPTER PAGE 

11. GOVERNMENT CORPORATIONS, V. O. Key, Jr 236 

1. CENTRAL CONTROLS AND MANAGERIAL FREEDOM 236 

Direction by the Chief Executive, 236; Overhead Control of Departmental 
Methods, 236, Control Machinery in Action, 237; Central Control and De- 
partmental Resourcefulness, 238; Changing Role of Government Corporations, 
238. 

2. THE DEVELOPMENT OF THE CORPORATE SYSTEM IN GOVERNMENT. . 240 

Variety of Government Corporations, 240; Government Corporations as Product 
of Emergencies, 241; Great Depression and World War II, 241, Government 
Corporations m the Field of Farm Credit, 243, Scope of Corporate System, 244. 

3. OVERHEAD CONTROL OF CORPORATE OPERATIONS 244 

Immunit) from the Power of the Purst, 244; Restrictions on Corporate Auton- 
omy, 246, Emerging State of Budgetary Control, 250, Powers of Comptroller 
General, 257; Central Control of Personnel, 255. 

4. CORPORATE AUTONOMY AND POLITICAL RESPONSIBILITY 256 

Legislative Bewilderment, 256, Political A iMgomsms, 258, Providing Informa- 
tion for the Legislature, 259, Enforcing Political Responsibility of Government 
Corporations, 260, Contribution of the Corporate Device, 262. 

12. FIELD ORGANIZATION, James W. Fesler 264 

1. THE GROWTH OF FIELD ORGANIZATION 264 

Continental Prototypes, 264; British Development, 266; Expansion of Federal 
Functions, 266, Technological Progress, 267; Scope of Field Organization, 
265. 

2J CENTRALIZATION AND DECENTRALIZATION 269 

Approach to Decentralization, 269; Factor of Responsibility, 270; Administra- 
tive Factors, 270; Functional Factors, 273, hxternal Factors, 274. 
/ 

3. FIELD-HEADQUARTERS RELAT IONS 276 

Rivalry of Functional Experts and General Administrators, 276; Lines of Com- 
mand, 277; Personnel Policies, 279, Headquarters Office of Field Operations, 
280, Problems of Communication, 280; Controls Over Field Organization, 281; 
Problems of Multilevel Field Organization, 283. 

4. INTERAGENCY COORDINATION IN THE FIELD 284 

Divergencies in Field Organization, 284; Emerging Uniformities, 285; Pooling 
of Field Resources, 286; Regional Coordinators, 287; Special Coordinative Ma- 
chinery, 288. 

5. THE PROSPECTS OF JOINT FIELD PLANNING 289 

Regional Planning Commissions, 259, Regional Development Authorities, 290; 
Function Versus Area, 297; Remaining Issues, 297; Community-Level Analysis, 
292. 

13. INFORMAL ORGANIZATION, Harvey C. Mansfield and Fritz 

Morstein Marx 294 



CONTENTS 

CHAPTER 

[My FORMAL AND INFORMAL ORGANIZATION 294 

Organic Growth of Informal Organization, 294; Charts and Realities, 294; " 
Attitudes and Motivations, 295; Basis of Personal Organization, 296; Growing 
and Shrinking Organizations, 297. 

2. ELEMENTS OF INFORMAL ORGANIZATION 297 

Characteristic Factors, 297; Self -Expression of Influence, 297; Variables Affecting 
Authority, 299; Forms of Personal Organization, 300; Ties of Allegiance, 303. 

3. NONHIERARCHICAL SOURCES OF POWER 306 

Men Behind the Throne, 307; The Personal Secretary, 309; The Invincible 
Constellation, 311; Clubs and Clusters, 312; Voice of the Union, 313. 

14. INTEREST GROUPS IN ADMINISTRATION, Avcry Leiscrson. .. 314 

1. THE MEANING OF INTEREST REPRESENTATION 314 

Types of Interest Groups, 314; Interest Orientation of Public Administration, 
315; Governmentahzation of Interest Groups, 316; Interest Groups and Class 
Theory, 317 ; Demands for Interest Representation, 317. 

2. CLIENTELE ORGANIZATION 318 

Growth of Clientele Agencies, 318, Disadvantages of Clientele Organization, 
318, Attempts at Internal Balance of Interests, 319; Functions of Clientele 
Agencies, 320; Experiences of the Great Depression and World War II, 321. 

3. STAFFING FOR POINT OF VIEW 322 

Grounds for Interest Representation, 322; Administrative Appointment of Inter- 
est Representatives, 323; Problems of Dual Allegiance, 324; Group Representa- 
tion Through Special Staff Units, 326, Balance Sheet of Experience, 329. 

4. INTEREST REPRESENTATION ON ADMINISTRATIVE BOARDS 330 

Membership Requirements, 330; Nomination by Interest Groups, 331; Bipar- 
tisan and Tripartite Boards, 332, Record of Wartime Labor Boards, 333; Test 
of Interest Compromise, 334. 

5. THE PRINCIPLE OF CONSULTATION 334 

General Theory of Interest Representation, 334; Basic Distinctions in Group 
Representation, 335; Organization of Interest Participation, 336; Three War- 
time Examples, 336; Foundations of Interest Consultation, 338. 

15. LEGISLATIVE CONTROL, V. O. Key, Jr 339 

1. MEANS AND CONDITIONS OF CONTROL 339 

Central Issue of Governance, 339; Formal Means of Legislative Control, 340; 
Looking Into Particulars, 341; Atomization of Control, 342; Weakness of Leg- 
islative Discipline, 343. 

2. CONTRADICTION OF INTEGRATION 344 

Absence of Collective Administrative Responsibility, 344; Splintering Effects of 
Legislative-Executive Relations, 345; Legislative Dealings with Subordinate 
Personnel, 346; Subtler Legislative Influences, 347; Grants of Organizational 
Independence, 348. 



XX * CONTENTS 

CHAPTER PAGE 

3. DIFFUSION OF INITIATIVE AND RESPONSIBILITY 349 

Executive Share in Policy-Making, 349; Desertions from the President's Pro- 
gram, 350; Inadequate Legislation, 351; Incongruity Between Power and Re- 
sponsibility, 352; Legislators and Administrators, 352. 

4. QUEST FOR ACCOUNTABILITY 354 

Selecting Department Heads, 354; Lower-Level Appointments, 355; Attempted 
Extension of Senatorial Confirmation, 356; Removal Power, 357; Legislative 
Pressure for Resignation, 358. 

5. DRIVES TOWARD REFORM 358 

Case for Cabinet Government, 359, Merits of a Question Period, 359; Legis- 
lative Committee Meetings with Administrators, 360; Legislative Staffs, 360; 
Making Legislative Work Manageable, 361. 



PART III 
Working Methods 

16. THE FORMULATION OF ADMINISTRATIVE POLICY, Avery 

Leiserson 365 

1. POLICY FORMATION AND POLICY SANCTION 365 

Realm of Administrative Policy, 365; Breadth of Policy-Making Process, 365; 
Prompting Role of Management, 366; Legislative Basis of Administrative Policy, 
366, Main Division of Responsibility, 367; Coordinate Tasks of Legist a tuic 
and Chief Executive, 368. 

2. FACT-FINDING AND DISCRETION IN ADMINISTRATIVE POLICY 368 

Delegation of Policy Determination, 368; Administrative Contacts with Pri- 
vate Fact-Finding Groups, 369; Interagency Use of Staff Resources, 370; Govern- 
ment-wide Clearance of Policy Proposals, 370; Insuring Objectivity in Staff 
Recommendations, 371. 

3. IDEOLOGY AND ADMINISTRATIVE POLICY 373 

Sources of Ideology, 373; Ideology of Political Office, 373; Administrative 
Ideology, 374; Intellectual Flexibility and Emotional Stability, 374; Effects 
of Ideological Orientation, 375. 

4. EXTERNAL INFLUENCES AND ADMINISTRATIVE POLICY 375 

Impact of Interest Groups, 375; Public Relations, 376; Issues of Legality, 376; 
Task of the Agency Lawyer, 377; Dynamics of Administrative Policy-Makmg, 
377. 

17. GOVERNMENT BY PROCEDURE, Dwight Waldo 381 

1. THE NATURE AND LIMITATIONS OF PROCEDURE , 381 

Meaning of Procedure, 381; Role of Procedure, 381; Procedures as Laws of 
Activity, 382; Procedure as Physiology of Organization, 383; Procedure as In- 
stitutional Habit, 383. 



CONTENTS XXI 

CHAPTER p AGE 

2. PROCEDURES AND PUBLIC ADMINISTRATION 385 

Rule of Law, 385; Safeguarding Liberty and Equality, 386; Legislative Prescrip- 
tion of Procedure, 386; Protecting Administrative Morality, 387; Aims of Pro- 
cedure, 388. 

3. TYPES OF ADMINISTRATIVE PROCEDURES 388 

Classes of Procedures, 388; Institutional Procedures, 389; Working Procedures, 
389; Diversity of Procedures, 391; Two Illustrations, 39 L 

4. CREATION AND CRITERIA 392 

Procedure-Making Compared with Pohcy-Making, 392; Procedure-Making Units, 
394; Art of Making Procedures, 394; Work Simplification and Procedural Stand- 
ardization, 395; Problems of Procedure-Making, 396. 

5. How TO LIVE AMONG PROCEDURES 398 

Law Versus Dispatch, 398, Deficient Procedures, 399; Assessing Red Tape, 399. 

18. THE TASKS OF MIDDLE MANAGEMENT, Fritz Morstein Marx 

and Henry Reining, Jr 400 

1. THE DUAL FUNCTION OF MIDDLE MANAGEMENT 400 

Importance of Intermediate Points of Control, 400; Middle Management Step- 
child of Administrative Research, 401; Recognition of a Higher Line Career, 
402; Middle Management and Top Direction, 404; Middle Management and 
Control of Operations, 406. 

2. SUPPORTING TOP DIRECTION 408 

Effectiveness of Downward Communication, 408', Two-Way Traffic of Thought, 
411; Taking Orders, 413; Tabulations of the Operator, 414; Thinking in Larger 
Terms, 415. 

3. RUNNING THE SHOW 416 

Problems of Delegation, 416; Reinforcing the Line Sector, 417; Organizing for 
Work, 418; Reporting Schemes, 419; Keeping Record, 420. 

19. THE ART OF SUPERVISION, Henry Reining. Jr 421 

1. WHAT is SUPERVISION ? 42P 

Direction With Authority, 421; Concept of Functional Foreman, 421; Phases of 
Supervision, 422; Scope of Supervision, 422; Institutional Aspects, 42 3. 

2: THE SUPERVISORY SKILLS 424 

Wartime Innovations, 424; Job Instruction, 426; Improving Methods, 428; 
Working With People, 430; Work Simplification, 432. 

' 3. PROBLEMS OF SUPERVISION 434 

Variations in Supervisory Situation, 434; Requirements of Good Supervision, 
435; Democracy of Work, 437; Selecting Supervisors, 439; Supervision and Pol- 
icy, 441; Span of Supervision, 442; Employee Organization and Supervision, 
442; Short-Run Versus Long-Run Point of View, 443. 

4. SUPERVISION AND EMPLOYEE INITIATIVE 444 

Institutional Climate, 444; Top Management Support, 445; Channeling Em- 
ployee Initiative, 445; Suggestion Systems, 445; Rating Employees, 446. 



XX11 CONTENTS 

CHAPTER PAGE 

20. ADMINISTRATIVE SELF-IMPROVEMENT, Donald C. Stone... 448 

1. EVOLUTIONARY CURRENTS 448 

Beginnings ot the Analytical Approach, 448; Growth of Systematic Inquiry, 
449; Academic and Professional Support, 449; Stimulus from Private Manage- 
ment, 450; Government Response, 452. 

2. ORGANIZATION FOR ADMINISTRATIVE ANALYSIS 452 

Conceivable Alternatives, 452; Improvement Through the Administrator's Per- 
sonal Action, 453; Use of Outside Consultants, 453; Use ot Committees, 454; 
Staff Meetings, 455; Role of an Administrative General Staff, 456; Types of Ad- 
ministrative Planning Offices, 459; Tasks of Line Operators and Supervisors, 
461; Role of the Rank and File, 462. 

3. TECHNIQUES FOR ADMINISTRATIVE SELF-IMPROVEMENT / . . . 462 

Mission of the Administrator, 462; Types of Administrative Surveys, 464; 
Reconnaissance, 466; Planning the Survey, 466; Review of Written Materials, 
467; Questionnaires and Check Lists, 468; Interviews, 469; Observation of Opera- 
tions, 470; Review of Communications, 471; Work-Load and Work-Measure- 
ment Data, 471; Charting Devices, 472; Reports, 472. 

4. BASIC RESOURCES IN MANAGEMENT IMPROVEMENT 473 

Qualifications for Analysis, 473; Skill in Human Relations, 474; Training Sur- 
veys, 475; Employee-Initiated Action, 476; Summary, 476. 

21. MORALE AND DISCIPLINE, Wallace S. Sayre 479 

1. THE MEANING OF MORALE 479 

Components of Morale, 479; True Com and Counterfeit, 480; Democratic Im- 
plications of Morale, 481; Doctrinal Counterinfluences, 481; Impact of Military 
and Business Prototypes, 483. 

2. BUILDING GROUP MORALE 483 ] 

Basic Premises, 483; New Methodology, 484; Teamwork, 485; Leadership, 

485; Group Development, 486; Working Together, 487; Union Attitudes, 
488; Incentives, 490 \ Performance Standards, 490; Essentiality of Purpose, 491. 

3. THE MODES OF DISCIPLINE 491 

Aims of Discipline, 491; Disciplinary Restraints, 492; Political Aspects, 493; 
Service Ethics, 493; Evocation of Self-Discipline, 494. 

4. MORALE AND INSTITUTIONAL PATTERN 495 

Organizational Structure and Concerted Action, 495; Balance of Structure and 
Morale, 495; Organization in Action, 495; Effects of Specialization, 496; Dis- 
cipline as Affirmative Pressure, 496. 



PART IV 
Responsibility and Accountability 

22, ESSENTIALS OF RESPONSIBILITY, George A. Graham 501 

1. MEN AND INSTITUTIONS 501 

Responsible Men, 501; Responsible Institutions, 503; Interdependence of Men 
and Institutions, 503; The Political Implications of Business Practice, 504; 
Automatism? 506* 



CONTENTS XXiii 

CHAPTER PAGE 

2. LEGISLATIVE RESPONSIBILITY 507 

Responsible Legislators, 507; Realism in Responsibility of Legislators, 507; Leg- 
islative Irresponsibility? 508; Suicidal Tendencies, 509; Responsibility and Lead- 
ership, 509; Responsibility of the Legislative Body, 510. 

3. EXECUTIVE RESPONSIBILITY 512 

Elected Chief Executives, 512; Responsibility of the Chief Executive, 51 3\ Ex- 
ecutive Restraint, 514; Executive Emphasis on Teamwork, 514; High Officials 
Political Leadership, 515. 

4. ADMINISTRATIVE IMPLICATIONS 516 

Politician and Civil Servant, 576; General Interest Versus Special Interest, 576; 
Integrity and Good Faith, 577; Civil Service But Not Servility, 577. 

23. THE JUDICIAL TEST, Don K. Price 519 

1. THE RULE OF PRACTICALITY 519 

Propriety of Administrative Rule-Making and Adjudication, 579; Test of Social 
Utility, 520; Two Illustrations, 527; Extending the Rule of Law, 522; Admin- 
istrative Regulation as Alternative to Public Ownership, 522. 

2. THE ADMINISTRATIVE PROCESS AND THE LAWYERS 523 

Prevention Over Punishment, 523; Regulation as Partnership in Management, 
524; Informal Settlement Versus Formal Adjudication, 525; Balance of Public 
Interests, 526; "Snuffing the Approach of Tyranny," 527; Federal Administra- 
tive Procedure Act, 529. 

3. ADMINISTRATIVE FAIRNESS AND JUDICIAL REVIEW 531 

Rules of Evidence, 531; Spot-Check of Judicial Review, 532; Scope of Judicial 
Review, 533; Legitimate Judicial Concerns, 534; Legislative and Judicial Stand- 
ards of Review, 535. 

4. THE ORGANIZATION OF ADJUDICATION 537 

Prosecutor-and-Judge Agencies, 537; Continental Administrative Courts, 538; 
American Alternatives, 539; Executive Integration of Regulatory Bodies, 540; 
Political Factors, 542. 

5. CONCLUSION 543 

Benefits of Administrative Specialization, 543; Combining Flexibility and Prin- 
ciple, 543. 

24. PERSONNEL STANDARDS, Milton M. Manddl 544 

1. RESPONSIBILITY AND COMPETENCE 544 

Ensuring Responsive and Resourceful Administration, 544; Management and 
the Personnel Function, 544; Reformist Background and Legislative Aspirations, 
545; New Outlook, 5-46; Diversity ot Government Employment, 546. 

2. THE PERSONNEL OFFICE IN GOVERNMENT 547 

Central Personnel Agencies, 548; Working Relationships, 549; Departmental 
Personnel Offices, 550; Relations With Operating Officials, 551; Qualifications 
for Personnel Work, 552. 



XXIV CONTENTS 

CHAPTER PAGE 

3. CLASSIFICATION AND COMPENSATION 553 

Characteristics of Classification, 553 \ Keeping Classification Up-To-Date, 554; 
General Overview Versus Special Considerations, 554; Classification and the 
Career Service, 555; Compensation, 556. 

4. EMPLOYMENT 557 

Implications of the Career Idea, 557; Recruitment, 559; Examinations, 560; 
Written Tests, 562; Oral Tests, 56J; Evaluation of Education and Experience, 
564; Performance Tests, 565; Placement, 566, 

5. TRAINING 567 

Types of Training, 567; Prc-Entry Training, 568; Orientation, 570; In-Scrvicc 
Training, 57f , Post-Entry Training, 57 3. 

6. EMPLOYEE RELATIONS 574 

Place of the Union, 574; Stress and Strain, 574; Unionism and Service Neu- 
trality, 575; Value of Unions to Management, 575; Grievance Procedure, 576. 

25. FISCAL ACCOUNTABILITY, Harvey C. Mansfield 577 

1. FUEL FOR THE ENGINES OF ADMINISTRATION 577 

Administrative Responsibility and Fiscal Accountability, 577; Multitude of 
Voices 578; Pressures and Restraints, 579; Pattern of Legislative Money Grants, 
580; Forms of Accountability, 58 L 

2. JUSTIFICATION 582 

Call for Estimates, 582; Departmental Consideration, 583; Formulation of the 
Executive Budget, 586; Legislative Action, 557; Congressional Reform Pro- 
posals, 590. 

3. BUDGETARY COORDINATION 593 

Essence of Coordination, 593; Stimulation of Program Thinking, 594; Coordi- 
nation by Consultation, 595; Departmental Synthesis, 596; Top-Level Coordi- 
nation, 597. 

4. BUDGET EXECUTION 598 

Budget Principles and the Test of Practice, 598; Divergence Over Ultimate Ends, 
602; Fund Control, 603; Allotments, 60 3; Apportionments, 604; Financial 
Reporting, 605; Personnel Ceilings, 605. 

5. AUDIT 606 

Public Finance and Representative Government, 606; Expenditure Control in 
England, 606; Beginnings of Expenditure Control in the United States, 607; 
Specificity of Appropriations, 608; Administrative Checks, 609; Delay and Lax- 
ity, 610; Path of Reform, 672; Formation of the General Accounting Office, 
613; Control Versus Audit, 614; Safeguarding Operational Responsibility, 6/5; 
Balance Sheet of Audit and Settlement of Accounts, 6/7. 

INDEX 623 



Parti 
THE ROLE OF PUBLIC ADMINISTRATION 



CHAPTER 



The Growth of Public Administration 

1. ADMINISTRATION PUBLIC AND PRIVATE 

Administration as Part of All Planned Effort. Save for those who drift 
through life and care not where the current takes them, all men know 
something from their own experience about the importance and the ways 
of administering their affairs. For to refuse to let circumstances run some 
wayward course and to work instead within the limits they impose to 
attain a more acceptable end this, at heart, is the idea of administration. 

In simplest terms, administration is determined action taken in pursuit 
of conscious purpose. It is the systematic ordering of affairs and the calcu- 
lated use of resources, aimed at making those things happen which we 
want to happen and simultaneously preventing developments that fail to 
square with our intentions, (it is the marshaling of available labor and 
materials in order to gain that which is desired at the lowest cost in energy, 
time, and money.) No man, therefore, who singly or in company with 
others has ever laid out or had laid out for him a course of action and 
proceeded on it can be without some intimation of the nature of adminis- 
tration. Motivated by their desires and interests, individuals and groups of 
individuals set themselves their main goals; what they do thereafter to 
translate these goals into positive achievement is essentially administration. 

Regardless of the field of human endeavor, there is thus an adminis- 
trative side to all planned effort. In simple situations where the things 
that need to be done are obvious, and it is fairly plain who can best do 
what, it is possible for people sharing an objective to work as a team and 
never grow aware of the fact that their teamwork for the common purpose 
spells administration. But when conditions become complex or difficult, 
when it is no longer easy to know how to proceed or whether the resources 
available will be adequate for gaining the common end, the administrative 
aspect emerges as a matter of special attention. 

This conscious concern with administration arises first, and principally, 
among the comparative few to whom it falls to outline programs, devise 



4 THE GROWTH OF PUBLIC ADMINISTRATION 

procedures, and direct or supervise operations. In a more general way, the 
importance of administration also comes tcy be recognized by the many 
those through whom the process of cooperative effort operates, so to speak 
and how they "see" it will usually make a considerable difference in the 
success or failure of the enterprise. Where they share in its purpose and 
can look forward to sharing in some way in its fruits, administration is 
accepted as the means whereby they are enabled to be successful in their 
jobs, and they work accordingly. Where they reject the purpose and see 
no prospect of a fair participation in its results, administration is regarded 
as a means of exploiting them against their will and under such circum- 
stances even a genius in management will be unable to achieve more than 
poor results. 

Although the purpose-minded individual has administrative problems 
in his own life, whether he lives in the modern metropolis or on a farm 
in Kansas, we usually speak of administration and management in con- 
nection with the organization and direction of cooperative or collective 
activity. The two terms administration and management are sometimes 
used interchangeably. In general, administration is the broader term, em- 
bracing such factors as establishing priority of specific goals, devising the 
most appropriate structural form for the cooperative enterprise, and harness- 
ing the total effort toward attainment of the defined ends. Management, 
in its distinctive sense, relates primarily to those activities which are designed 
to make the enterprise succeed within the framework of policy, structure, 
and resources. 

Unity of Scientific Knowledge of Administration. It is in the sphere 
of cooperative or collective effort that administration has its primary signifi- 
cance. Whether social, religious, economic, or political in character, every 
organization depends on administration for accomplishing its aims. And 
the larger the organization, other things being equal, the greater the need 
for administration to be formally and extensively developed. On the ques- 
tion of whether administration is chiefly art or science^ we can here confine 
ourselves to the observation that, while it is and must be both; it is steadily 
coming to be more than an art. From either angle, however, it is equally 
obvious that the precepts and standards of administration comprise a single 
discipline. Its rules and insights are utilized in numerous and widely 
different fields; they nevertheless constitute but one body of theory and 
practice. 

Like other sciences, the developing science of administration has many 
branches. All of them, however, stem from the same trunk. Not a few 
people have deluded themselves by assuming to take the most serious 
misconception that business administration and government administration 
are entirely separate spheres, completely distinct from each other. The 
fact is that they have more in common than not. Neither stands alone; 
both are parts of a larger whole. As disciplines they differ not so much 



THE GROWTH OF PUBLIC ADMINISTRATION 5 

in theory and practice as in the uses to which they are put. Yet even in 
their particular objectives the gap between them is not as wide as some 
seem to suppose. Government and business profit alike by contributions 
made by either to the advancement of administration. As one example, the 
growing membership and influence of the Society for the Advancement of 
Management, supported by both groups, prove that these truths are being 
appreciated on both sides. Both are realizing how much theirs is a common 
goal and a common interest. 

Business affords the most obvious illustration of private administration. 
But we find highly developed administration of a nongovernmental char- 
acter in other institutional realms also. Mooney and Reiley have under- 
scored the importance, especially for the study of organization, of the largely 
unexplored riches in the field of ecclesiastic administration. 1 The Roman 
Catholic Church and the Greek Orthodox Church come to mind as two 
conspicuous examples. These and other religious bodies throughout the 
world have maintained themselves continuously through many centuries. 
Such a record implies remarkable administrative as well as spiritual achieve- 
ment. It merits more attention by students of administration than it has 
thus far received. 

Colleges and universities comprise another institutional sphere which 
has contributed much to the development of tested administrative knowl- 
edge. The universities of Paris, Oxford, Palermo, Cairo, Salamanca, Kiev, 
and Harvard are but a few of many outstanding institutions of learning 
which have survived through hundreds of eventful years into our own 
time. In order to accomplish their intellectual mission they had to give 
much thought to the administration of their institutional affairs. Even 
today few problems are more complex than those of giving common focus 
to the interests of professors, students, parents, alumni, trustees, and donors 
or taxpayers especially when we consider the fact that most of these 
individuals are free agents, not subject to compulsion. 

Scope of Public Administration. At its fullest range, public adminis- 
tration embraces every area and activity under the jurisdiction of public 
policy. We might even include the processes and operations through which 
the legislative branch is enabled to exercise its law-making power; there 
is much adroit management in the enactment of legislation. In the literal 
sense of the term, public administration also includes the functions of the 
courts in the administration of justice and the work of all the agencies, 
military as well as civilian, in the executive branch of government. An 
exhaustive treatise on public administration would, therefore, have to give 
consideration to judicial structure and procedure and likewise to the special 
machinery and methods employed by the armed forces, in addition to 

1 Mooney, James D. and Reiley, Alan C., The Principles of Organization, New York: 
Harper, 1939, especially the discussion of hierarchy in the Roman Catholic Church in the chapter 
on "Theories of Organization." 



6 THE GROWTH OF PUBLIC ADMINISTRATION 

legislative management. By established usage, however, the term "public 
administration" has come to signify primarily the organization, personnel, 
practices, and procedures essential to effective performance of the civilian 
functions entrusted to the executive branch of government. We shall use 
the term in this customary sense, (p 

While not disregarding judicial or military functions, public administra- 
tion in our meaning denotes mainly the work of civilian agencies charged 
by statutory mandate with carrying on the public business assigned to them. 
Broadly speaking, it covers everything they do, or could do, to help the 
body politic attain its purposes| More specifically, though not ignoring con- 
siderations or activities peculiar to particular governmental levels, types of 
program, or geographic areas, I public administration centers its concern in 
those matters of organization, procedure, and method common to all or 
most administrative agencies. It pertains first and foremost to those factors 
of basic importance found throughout the whole range of executive respon- 
sibility, j 

Application of the body of knowledge called public administration to 
any particular function like welfare may carry us from the level of the 
town hall to that of the statehouse, from there to the national stage, and 
on beyond to international affairs. It may span, on a single plane, from 
the bogs and bayous of a Louisiana parish to the desert lands of a county 
in Nevada or the wooded hillsides of a New England town. It may impress 
identical features on such different functions as health, education, conserva- 
tion, transportation, telecommunication. Or it may weave back and forth 
from a patently "governmental" function like the arrest and detention of a 
thief, to a quasi-governmental, quasi-commercial one like the operation of 
an electrical utility, and again to what the cynic would regard as a public 
function par excellence, the collection of taxes. Despite the shifting scenes, 
certain problems will recur and certain precepts will be uniformly applicable 
in every field. Generic administrative theory is everywhere the same; its 
major parts comprise the "elements" of public administration. 

Elements of Public Administration. The fundamentals of organization, 
procedure, and method essential to efficient service in all fields alike, irre- 
spective of level, area, function, or purpose, fall into three principal groups. 
Success in administration is a composite product made up for the most 
part of: (a) effective relations in policy-making between the chief executive 
and the legislature or, in the case of a private enterprise, the board of direc- 
tors governing the organization; (b) ability of the chief executive and his 
principal aides and key subordinates to incorporate the policies adopted 
by the legislature or board of directors into workable plans of operation, 
sustained by appropriate grouping of component activities; and (c) skill 
of those in charge of operations in so directing, coordinating, instructing, 
and winning the collaboration of the rank and file of employees that the 
objectives embodied in policies and plans will be efficiently accomplished. 



THE GROWTH OF PUBLIC ADMINISTRATION 7 

Thus it follows that the elements of public administration consist of three 
sets of considerations or hypotheses: the first pertaining to the role of the 
executive head in policy-making, the second to relations between that official 
and his immediate associates in the top structure of the administrative 
hierarchy, and the third to relations between the higher operating chiefs 
and all employees of progressively lower rank. 2 

Every science has its problems of nomenclature. One of the problems 
of nomenclature in public administration has been to develop agreement 
on terms that would clearly denote the three major aspects or phases of 
this science. While usage has not become firmly settled, the highest respon- 
sibilities those involving relations with the legislative body are generally 
classified as being executive in character. Those primarily oriented toward 
the general scheme of operations are usually referred to as administrative. 
Those relating to the actual direction and supervision of the whole force of 
employees arc in the main labeled managerial. Managers supervise the fulfill- 
ment of work programs under the general direction of administrators, who 
in turn carry responsibility for broad assignments given them by the chief 
executive, whose policies are formulated in collaboration with the legislative 
body. It should be noted, however, that each main phase of responsibility 
carries its emphasis into the body of aides attached to it; thus the chief of a 
departmental planning staff is an administrative aide. 

Administration as Servant of Policy. Whether the sphere of interest be 
public or private, administration is always the servant of policy. Manage- 
ment the largest part of administration denotes means, and means have 
no significance except in terms of ends. The dichotomy of ends and means 
forms the basis of and supplies the justification for studying public adminis- 
tration as an identifiable aspect of government. We usually think of govern- 
ment as being divided naturally into three coordinate parts legislative, 
executive, and judicial. It is desirable to recognize the utility of conceiving 
of government as a going concern having but two main phases making 
public policy an^ administering the public business in accordance with 
that policy. 

When the legislative and judicial branches of our national and state 
governments confine themselves to their proper functions, the former con- 
cerns itself mainly with problems of policy and the latter works entirely 
in the field of administration administering justice. In contrast with these 
branches, the executive department is obliged to a certain extent to carry a 
double load; top executives have to labor in both vineyards. Presidents, 
governors, and mayors (save when relieved of administrative duties by a 
city manager) are required to serve both as political leaders and adminis- 

3 See Pearson, Norman M., "Fayolism As the Necessary Complement of Taylorism," 
American Political Science Review, 1945, Vol. 39, pp. 68-80. For further elaboration, see Urwick, 
Lyndall, The Elements of Administration, London: Pitman, 1943. 



8 THE GROWTH OF PUBLIC ADMINISTRATION 

trative chiefs. Except for such administrators-in-chief and their principal 
subordinates, however, those engaged in administration do not make or 
necessarily participate in making the basic policies they execute. Their 
prime job is to give effect to policy. Their main function is the execution 
of programs. The sponsorship or authorization of programs is the task of 
policy-makers the elected members of the legislative body and the chief 
executive with his associates. 

Translated into governmental terms, the ends-means scheme becomes 
the dichotomy of politics and administration. 3 Admitting its relativities, 
this is a useful distinction. It is of practical value also in helping free 
citizens understand what they can most wisely do in making democracy 
work. The political tests of policy are mainly two: enlightenment and 
representativeness. The citizen can force his government to meet these 
tests by the proper use of his vote. In contrast there is only one main test 
of public administration, and one difficult or impossible for the citizen to 
apply: Are the means used effective in terms of their cost in achieving 
the end sought? The best way for the citizen to ensure that his government 
meets this test is not by trying to measure administrative efficiency himself 
but by making his elected representatives insist on the use of objective 
measurement of performance within the administrative system. 

As a general proposition, policy and politics in the sense of the political 
process of policy determination are primary to administration both logically 
and chronologically. Policy defines the aims and ends of governmental 
action. The ideal of government by consent of the governed would be 
empty unless the common man had his say in the matter. In a democracy 
of large-scale governmental operations like ours the citizen plainly cannot 
have his say directly, except within narrow limits. Through voting, how- 
ever, and through other kinds of political activity he can indirectly express 
his preference in policy. The people choose their representatives in the 
legislature and at the helm of the executive branch; these persons proceed 
with the making of public policy. Though they may receive advice and 
information from various quarters officials as well as interested groups 
they alone are called upon to determine and declare policy. 

On the highest level, \therefore, public policy is what politically chosen 
representatives make it. It is after they have set the goals and laid out the 
main lines of action for attaining these goals that the basic role of public 



8 For two classic statements of this distinction, see Wilson, Woodrow, "The Study of 
Administration," Political Science Quarterly, 1887, Vol. 2, pp. 197-222, and Goodnow, Frank J., 
Politics and Administration, New York: Macmillan, 1900. For an indication of current views, 
see Haines, Charles G. and Dimock, Marshall ., eds., Essays on the Law and Practice of 
Governmental Administration, Baltimore: Johns Hopkins Press, 1935. 



THE GROWTH OF PUBLIC ADMINISTRATION 9 

administration begins. 4 Administrators have the task of enforcing or imple- 
menting policy J It is the essence of their craft to handle the public's business 
with the greatest efficiency possible, limited only by the resources available 
to them and the conditions under whhh they are required to work. In 
their capacity as citizens, the men and \\omen who serve in public admin- 
istration may not always share the views of those who make official policy 
or agree with its wisdom. Unless they resign their posts, however, it is 
their solemn duty to bend every effort to accomplish the purpose or the 
program set. It is not their business to try to substitute any greater wisdom 
they may think they have for any lesser wisdom of the people's chosen 
representatives. The time for administrators to record their doubts is at 
the stage of policy consideration or reconsideration. Here they will usually 
be heard with full appreciation of their judgment. 

The public service has much to gain and nothing to lose from observing 
the implications of the dichotomy of politics and administration. To the 
degree that administrative officials make clear by word and deed that they 
regard themselves principally as agents of policy, the public will be likelier 
to confine itself to the control of policy in the legislative arena, leaving 
administration free to do its work without direct political interference. 

2. THE AMERICAN BACKGROUND 

Heritage from Britain. Five European nations participated in the ex- 
ploration and early settlement of what is now the continental United States. 
Only one of them, Britain, left a deep imprint upon our administrative 
institutions. British antecedents furnished the models for the towns which 
still are the fundamental political units in New England and for the 
counties which form the basis of local government in the agrarian South. 
The mixed pattern of towns, townships, cities, and counties which has 
developed in other regions of the country also arose from these beginnings. 
The combinations and modifications which took place have been due mainly 
to the influence of geographic and economic factors, and also to the fact 
that those who migrated from one section to another simply carried some 
of their customs with them. 

The ad hoc or special-purpose governmental districts for schools, water, 
drainage, health, recreation so ubiquitous in American local administra- 
tion, are likewise to a degree of English origin. Gcnerically, they may be 
traced back to the concept of the limited or single-purpose local public cor- 

4 The sequence of politics and administration is perhaps most easily visualized with refer- 
ence to a particular statute or program. There are at least five stages in the process, the first 
three chiefly political, and the latter two mainly administrative: (a) development of a favorable 
public opinion; (b) electioneering; (c) formal legislative adoption or enactment; (d) normal 
executive administration, continuing as long as the policy remains unchanged; and (c) judicial 
administration for interpretation and application of the policy whenever the citizen claims 
thit enforcement would invade his legal rights. Cf. Anderson, William, American City Govern- 
mcnt, pp. 188-1<>2. New York: Henry Holt, 1925. 



10 THE GROWTH OF PUBLIC ADMINISTRATION 

poration as developed in Anglo-Saxon jurisprudence. This is not to suggest, 
however, that the explanation for our extensive not to say, excessive use 
of these units is bad British precedent. The historic reason for our having 
today some 127,000 school districts is not that our ancestors blindly followed 
the example of seventeenth-century English administrative organization. It 
was partly the need for a convenient governmental unit through which early 
Americans, especially in the northern colonies, could realize their ambition 
of providing free common schooling for all children; and partly, once the 
pattern of reserving sections of the public domain for the support of educa- 
tion had beeji established, the necessity for a device whereby the people of 
the Northwest Territory (1787), and also of all other areas subsequently 
opened for settlement, could organize to take advantage of their educational 
opportunities. Whether the district system should be retained unchanged 
or whether it should be modified and simplified are questions to which 
students of public administration in the twentieth century must find answers. 

Until the first gains, during World War I, of the movement for 
state administrative reorganization, perhaps the best way to describe the 
impact of the British example on state government would have been in 
terms of "reverse English." American experience with royal colonial admin- 
istration had been such that, when the people themselves came into control 
after 1776, they reversed the model of the powerful chief executive. In 
organizing their new state governments they vested preponderant power in 
the legislative assembly. Aside from the presidency, it took the nation 
approximately a century to overcome its fears and suspicions of centralized 
authority, even under popular and legislative control. The movement for 
administrative integration under a strengthened executive which has been 
the key to much of the progress made in state government during the past 
generation is a relatively recent development. 

Insofar as the form and character of American national government is 
concerned, the Constitution on which it is based comprises a bundle of com- 
promises. One of the reasons why compromise was so essential in the his- 
toric summer of 1787 was the insistence of many of the Founding Fathers 
that the document incorporate numerous features of the British system of 
government. They aimed at framing a polity combining both aristocratic 
and democratic characteristics, but in such a way that over the years the 
popular features could gradually be expanded. Every mature citizen may 
judge for himself how well they succeeded. 

Finally, there is the matter of English ideals of liberty, equality, and 
justice. Our British heritage has not consisted merely of mechanics related 
to administrative areas and structures. In some ways the most significant 
elements have been those conceptions of individual freedom, due process, 
and equal justice which, adding up to the "rule of law," are perhaps the 
richest political treasure of American as well as of Anglo-Saxon civilization. 
Americans have introduced many modifications in their administrative as in 



GROWTH OF PUBLIC ADMINISTRATION 11 

their linguistic heritage. Yet these have not replaced the foundations. 
British influence lives in American administration today not only in its struc- 
tural forms and operating procedures but still more in the spirit by which 
the whole system is animated. 

Influence of the Frontier. As part of the "cutting edge of civilization," 
public administration is always affected at any given time by what civiliza- 
tion is trying to cut. When it is the wilderness of untamed forests, prairies, 
swamps, and deserts with which American government had to contend for 
three hundred years as the pioneers made their way westward across the 
continent, the effects are of one kind. When civilization is cutting economic 
or social barriers in a highly industrialized and urbanized society, the effects 
are of a different nature. 

The physical frontiers against which American civilization was pushing 
from the days of the landings at St. Augustine, Jamestown, and Plymouth 
until the last of the good "free land" was staked and claimed around 1890 
had several major influences upon the emerging administrative system. 
Sparsity of population and the simple life which the pioneers and first set- 
tlers led, together witl\ their fierce spirit of self-reliance, caused the activity 
of government to be restricted at the outset to little more than the main- 
tenance of the peace, the recording of land titles and the administration of 
justice. As a result, the ideal of limited government became deeply ingrained 
in American political thought. This in turn encouraged the view, asserted 
on a national scale by Andrew Jackson, that the duties of public employees 
were, or admitted of being made, so simple that as a general rule they could 
be performed in a reasonably satisfactory manner by the ordinary citizen, 
irrespective of the character of his previous private pursuits. Honesty and 
normal intelligence were thought to be the only essential qualifications. 

These influences have expressed themselves chiefly in two ways. One 
has been the constant disposition of the public to be suspicious of all pro- 
posals to extend the range of administrative activity. Millions of Americans 
still hold the conviction that government should both stay out of business 
and keep away from it the late nineteenth-century version of Jefferson's 
preference for that government which governed least. The other influence 
has been a somewhat naive faith in mechanically simple and direct relation- 
ships between the citizen and his public servants, coupled with a stubborn 
refusal to combine defectively small governmental units into larger and 
more resourceful entities. Until near the _ close of the nineteenth century, 
virtually every important administrative office wHetrier IrTtown, city, school 
district, county, or state was on an elective basis. Many still are, particu- 
larly in the counties. Moreover, terms of elective office are invariably short 3 
seldom running over two years. 

As for appointive positions, the presumption prevailed from the early 
days that there should be frequent rotation in office and that every newly 
elected official had the right to dismiss incumbents inherited from his pre- 



12 THE GROWTH OF PUBLIC ADMINISTRATION 

decessor and fill their posts with appointees of his own choosing. Con- 
siderable success has been achieved on the national level and in the more 
progressive states and cities in replacing this tradition by the sounder one 
of career service based on merit. However, the old way remains dominant 
over a considerable area of public administration even to this day. 

Hamiltonian and feffersonian Traditions. Another historic influence upon 
modern American administration has been the unceasing contest between 
two different governmental theories espoused by the two opposing titans 
of Washington's original cabinet. 5 

Hamilton, brilliant, logical, and conservative, believed that commercial 
strength constituted the only sure foundation for national welfare and 
favored bold use of federal authority to advance that end. His program 
for building up a business class through tariff protection and other aids to 
industry inevitably entailed a considerable exercise of centralized power. 
This caused opposition at a time when previous experience led most people 
to cavil at every debatable employment of public authority as a danger to 
individual liberty. Hamilton, however, had no fear of power in government 
provided that those who wielded it could be held responsible for their acts. 
This philosophy has been a significant factor in American government. 
Disillusionment with the consequences of his economic approach has weak- 
ened the appeal of Hamilton's program at various times. It is hardly too 
much to say, however, that his philosophy of administration readiness to 
use governmental power wherever there is assurance of public control over 
its use is stronger today than ever before. 

Jefferson, his great antagonist, disagreed with these ideas though not 
with a policy of fostering the development of commerce or of using such 
power as was indispensable to the attainment of some end that would greatly 
enhance the public welfare. Visualizing the country as destined under the 
right leadership to develop into a glorious agrarian democracy in which 
every man could find security for his family in the cultivation of his own 
acreage or in independent work as artisan, Jefferson saw little need for 
national administration other than that required for the conduct of foreign 
relations. 

Beneath this belief, however, lay a more fundamental conviction. Jef- 
ferson was of the opinion that power always tends to corrupt the man in 
whom it is vested. He considered the difficulties of preventing its abuse so 
formidable as to make imperative its limitation to the barest minimum. 
Jefferson's agrarian ideal has long since lost all chance of translation into 
actuality. However, no one needs to be told that because of the continued 
and gradually increasing expansion of central government, this philosophy 
of limited and decentralized administration is one of the most effective rally- 
ing cries for many who are earnestly concerned over the future of American 

5 Cf. Caldwell, Lynton K., The Administrative Theories of Hamilton and Jefferson, 
Chicago: University of Chicago Press, 1944. 



THE GROWTH OF PUBLIC ADMINISTRATION 13 

federalism. There are simultaneously groups within the body politic who 
are exploiting the fear of power for selfish purposes. 

Clearly, neither the Hamiltonian nor the Jeffersonian tradition embraces 
the whole truth. Public administration has profited by accepting parts of 
both. The problem has been and will continue to be how much em- 
phasis at a given time to accord to each. 

Public Administration and the National Economy. Adam Smith's The 
Wealth of Nations, published in the year of the American declaration of 
political independence, served in a sense as a declaration of economic inde- 
pendence on behalf of the rising business or middle class. As such its basic 
ideas came to have an enormous vogue throughout the whole Western world. 
It is no exaggeration to say that during the nineteenth century they sup- 
plied the dominant coloration in popular thought on the relations between 
government and business. Nor have they ceased to exert their influence. 
The philosophy of classical economics which took its rise from this epic 
volume was far more than a reasoned protest against the theory and practice 
of mercantilism. It had a positive character of its own, the implications of 
which were of cardinal importance for public administration. 

Politics and economics, according to Adam Smith, were largely separate 
spheres. The less they had to do with each other, the better. Every man 
had his own property or skill and the impulse of self-interest to lead him 
to put them to the best employment. The wisest thing government could 
do, therefore, to help men solve their economic problems was to leave the 
business world strictly alone. Admittedly it was necessary for government 
to prevent or suppress civil disturbances, punish crime, and build and main- 
tain basic public works. In the domestic realm at least, however, this was 
as far as it should go. 

With a virgin continent opening up in the eighteenth and nineteenth 
centuries, great numbers of the people of the United States had property of 
their own land being naturally the main type; or, lacking property, they 
could acquire some. Land enabled a family to be relatively self-sufficient. 
Consequently, the philosophy of governmental nonintervention did no such 
violence to the economic facts of life as it would in our day. Widespread 
ownership of land, actual and potential, provided at least some justification 
for laissez jaire government. Another factor was the neat complementation 
of legal theory: it was, and is, one of the basic tenets of the "rule of law" 
here as in England that the citizen is at liberty to do whatever has not been 
prohibited, provided only that he recognize the equal right of everyone else 
to act in the same way. 

It required, therefore, a long and slow development, through decades 
blotted with innumerable instances of helpless poverty and social injustice, 
to raise political thinking above the standard of freedom from regulation of 
any kind to a higher standard. This higher standard of the present age is 
freedom under regulation designed to safeguard the general welfare. Until 



14 THE GROWTH OF PUBLIC ADMINISTRATION 

the new development was well under way, public administration had only 
halting and tentative relationships with the national economy. Today gov- 
ernmental activities in countless ways sustain our economic life. 

Assertion of the Public Interest. Charles E. Merriam has pointed out 
in a recent study of public planning that in the early decades of the last 
century the federal government showed some concern over abuses inherent 
in uncontrolled private exploitation of the nation's natural resources. Yet 
it was not until the eighties that practical action was initiated to safeguard 
the public interest. 6 Following the panic of 1837, Massachusetts established 
a state bank commission to make sure thereafter of the observance of it? 
banking regulations. Still, even though there was similar provocation ir 
other states, few followed suit. 7 Jurisdiction over such matters lay generall) 
with the states; their inaction often resulted in hardship and injustice foi 
numerous individuals. Nevertheless, it was only after the Middle Westerr 
states had enacted the Granger laws in the seventies that government begar 
to intervene more extensively in the economic sphere. 

Conceivably, the executive arm of the national government might hav< 
been employed to prevent the occurrence of abuses as the economy of th< 
country expanded. However, any effort toward effective use of publi< 
authority for such purposes would have met the strongest kind of opposition 
From the history of governmental regulation during the late nineteend 
century it is evident that the new public administration was in a sense th< 
unwanted child of a nation bent on the wild pursuit of material gain. Gros 
rapacity and prodigal wastage had to demonstrate the error in the belie 
that competition invariably worked like an invisible hand to ensure the prc 
tection and promotion of the common welfare. Only then did the represen 
tative bodies begin to emphasize the positive note in the American phi! 
osophy of government the idea that government exists to safeguard th 
general welfare. Only then did they enact the statutes and create the agencie 
which account for the contemporary range of public administration. 

3. THE EXPANSION OF GOVERNMENTAL FUNCTIONS 

American Pragmatism. With some measure of justification, it has bee 
said of the people of the United States that as a nation they are not muc 
given to systematic political speculation. Throughout our history it has ger 
erally been assumed without benefit of particulars that the sphere of goverr 
mental activity should be sharply limited and that government should "sta 
out of business." No one, however, has succeeded in making a list of propc 
and improper functions of government that has won public approval an 
held it over an extended period. William Graham Sumner's What Do Socit 

6 Merriam, Charles E., "The National Resources Planning Board: A Chapter in America 
Planning Experience," American Political Science Review, 1944, Vol. 38, p. 1075 ff. 

7 Cf. White, Leonard D., Introduction to the Study of Public Administration, pp. 26-2 
New York: Macmillan, rev ed., 1939. 



THE GROWTH OF PUBLIC ADMINISTRATION 15 

Classes Owe Each Other? (1883) and Herbert Spencer's Man Versus the 
State (1884) both endeavored to demonstrate analytically why it was unwise 
to enlarge the range of governmental action. Yet the functions of govfern- 
ment were increased even during the decades in which these books were 
enjoying their greatest popularity. Though their theoretical inclination has 
consistently been to keep the scope of government restricted, the American 
people have shown equal consistency in basing their action on "practical 
considerations" whenever these have pointed strongly in the opposite direc- 
tion. 

The line of argument implied in Cleveland's famous sentence, "It is a 
condition and not a theory which confronts us," is one that has always made 
sense to most Americans. They tend to believe that the presumption should 
never be in favor of adding to the powers or responsibilities of government; 
but they also insist that in the last analysis "government has to do what it 
has to do." 8 They have never been prepared to adhere blindly to mere theory 
when the price of such adherence would have been acute social injustice or 
failure to reach some objective to which they were strongly attached. It 
remains to be seen how far attitudes will change in the face of the new con- 
cern for high-level employment. Up to now, however, Americans have 
tended to support the broad principle that government should not meddle 
in the domain of economic affairs and at the same time they have wanted it 
to be prepared to help them meet whatever economic difficulties might prove 
to be beyond the capacity of business. 

Limits to Governmental Nonintervention. American administrative his- 
tory abounds in illustrations of governmental extensions to meet current 
needs. Consider, for instance, the compromise of laissez faire involved in 
the erection of national tariff walls, in the establishment of the three "clien- 
tele" departments in Washington Agriculture, Commerce, and Labor and 
in the creation of certain of our governmental corporations. Each of these 
developments represents something of a variation on the theme of the pure 
theory of the American politico-economic system, yet each is accepted as a 
part of the system in operation. Curiously enough, those who show the 
greatest interest in urging government to pursue or persist in a positive course 
of action are often quite unconscious of what they do in terms of this theory. 
The reason is simple. If a particular group can manage to persuade govern- 
ment to intervene in the economic sphere on behalf of its own special 
interest, that naturally seems to it all to the good; it is "interference" only 
in the eyes of those who are interfered with to them it is all wrong. 

Few groups in the body politic have given more lip service to the prin- 
ciple of the separation of government and business than the leaders of 
industry. They have always held it high as a general idea. Yet from the 
time of Alexander Hamilton to the present they have generally favored 

8 For the nature of the people's power over public administration, see Appleby, Paul H., 
Big Democracy, p. 135 ff., New York: Knopf, 1945. 



16 THE GROWTH OF PUBLIC ADMINISTRATION 

tariff protection a clear illustration of> artificial interference with the dis- 
pensations of the "invisible hand" of foft and "natural" competition. Nor is 
it relevant that many believers in laissez jaire have fought for tariffs with- 
out being aware of their inconsistency. Their leaders have usually known 
what they were doing. As practical men they have merely refused to allow 
intangible principles to stand in the way of tangible results. 

Establishment of Clientele Departments. Governmental intervention in 
the field of agriculture began nationally in an almost unnoticed activity of 
the Patent Office the distribution of seeds and cuttings received from 
American consuls abroad. After performing this humble service for a 
number of years, the Patent Office in 1839 was given its first agricultural 
appropriation of $1,000. This was to be used for continued collection and 
distribution of seeds, for making several investigations of interest to farmers, 
and for the collection of agricultural statistics. Succeeding years brought 
increased appropriations without additional functions. Then, in 1862, under 
the urging of the United States Agricultural Society whose members wanted 
additional "service" from the government, Congress took the decisive step 
of passing the "organic act" which created "at the seat of government of the 
United States a Department of Agriculture/* 9 

It is a far cry from these modest beginnings to the gigantic operations of 
the department today. But two strong threads have provided connecting 
ties throughout every stage of the development. One is the continuous desire 
of organized farmers for governmental aid to agriculture. What the United 
States Agricultural Society did in persuading Congress to establish a new 
department in the midst of the Civil War typifies what organized agriculture 
has tried to do ever since gain for itself in the solution of its problems the 
friendly assistance of government. The other thread is the willingness of 
the public to "go along." Occasionally it does so for the positive reason that 
it thinks the general welfare would be served by providing the help sought. 
The usual explanation is much simpler, however. Unless the opponents of 
a proposal can convince the public that its passage would open the door to 
a raid on the treasury, it is almost impossible to rally a majority to block its 
enactment. 

The Department of Commerce and Labor, created in 1903, was the sec- 
ond major clientele agency established within the structure of national 
administration. In terms of its germinal bureaus, it rose from such practical 
considerations as the necessity for proper patent registration (Superintendent 
of Patents, 1802), the need for inspection of steamboats to ensure their sea- 
worthy condition (Steamboat Inspection Service, 1838), and the demand on 
government for maintaining a testing laboratory of its own in order to assure 
itself of getting full and precise value in the purchase of supplies (National 
Bureau of Standards, 1901). In terms of its creation as a combined entity, 

Gaus, John M. and Wolcott, Leon O., Public Administration and the United States 
Department of Agriculture, pp. 3-5, Chicago: Public Administration Service, 1940. 



THE GROWTH OF PUBLIC ADMINISTRATION 17 

the Department of Commerce and Labor owed its origin to the fact that 
around the turn of the century the President and Congress alike were con- 
vinced that administrative needs would better be served by bringing togethei 
twelve existing bureaus doing broadly related work in a single, fairly unified 
agency. 

The unit within the Department of Commerce and Labor which has 
aided the American business community most directly came into being as 
the Bureau of Foreign and Domestic Commerce. Established in 1912 by an 
act of Congress, it was charged specifically with the "the promotion and 
development of the foreign and domestic commerce of the United States." 
Organized business worked actively for the passage of the measure setting 
up the new bureau and has since then looked upon the department, not 
unreasonably, as its special source of sympathetic governmental assistance. 

Like the Department of Commerce (from which in 1913 it was formed 
by separation), the Department of Labor was composed initially of two 
bureaus which had been created in preceding years. The older of these was 
the Bureau of Labor, established by Congress in 1884 for the purpose of 
collecting and analyzing information on labor conditions and located in the 
Department of the Interior. Named the Department of Labor a few years 
later and given independent status though not cabinet rank, it was in 1903 
again designated as a bureau and grouped with a number of other agencies 
to form the Department of Commerce and Labor. The other original ele- 
ment of the newly formed Department of Labor was the Children's Bureau, 
which had been in existence for less than a year. As its name implies, the 
Children's Bureau was created for the purpose of gathering information 
and preparing reports, nationwide in scope, on problems of child care and 
child welfare. The considerations leading the President and Congress to 
combine the two bureaus into a department of cabinet rank were political 
and administrative. With organized labor's increasing success in making 
the public aware of the problems of the working class, it appeared to be 
both "good politics" and sound administrative grouping to accord labor the 
same kind of recognition which had already been given to agriculture and 
business. 

Rise of Governmental Corporations. As American pragmatism is evi- 
dent in the creation of these three great clientele departments, so it can be 
seen just as plainly in the circumstances under which some of our govern- 
mental proprietary undertakings were launched. With popular opinion 
generally adverse to government's "going into business," most proposals to 
set up a publicly owned or publicly operated business enterprise have a strike 
or two against them before they get under way. Yet government corpora- 
tions are by no means uncommon on the American administrative scene. 
Many urban communities throughout the country have established their 
own corporate enterprises in the field of municipal utilities. When the citi- 
zens found themselves unable to obtain satisfactory water, electric, gas, or 



18 THE GROWTH OF PUBLIC ADMINISTRATION 

transit service at reasonable rates through private firms, they took what 
seemed to them the logical second course of using their local government to 
set up and operate its own facilities. 

As a rule the states have had little need for such corporate enterprises 
of their own. For a variety of reasons, however, the national government has 
made increasing use of corporate organization during the past thirty years. 
During World War I, for instance, a governmental corporation was formed 
for so vital a purpose as the expediting of an emergency shipbuilding pro- 
gram. Several such corporations were formed during the years of the Great 
Depression to aid economic interests, and especially to make and administer 
loans to business firms in need of credit and unable to obtain it from private 
sources. The Tennessee Valley Authority, created in 1933, was given cor- 
porate status so that it might enjoy the greatest possible measure of adminis- 
trative freedom and flexibility in developing its unique program of regional 
rehabilitation, including cooperation toward that goal with the people of 
the region through their local organizations, both governmental and private. 
In World War II, to take but one of many examples, the national govern- 
ment organized the United States Commercial Corporation because of the 
need for an agency through which it could act with convenience and dis- 
patch and with a minimum of publicity in waging certain forms of economic 
warfare. It is clear, therefore, that the serious public reservations against 
proliferation of governmental activities have not barred the use of govern- 
ment corporations when the people have been unable to satisfy their needs 
through the services of private enterprise. 

Growth of Administrative Activities. The response of government in 
this country to what the late Justice Holmes called "the felt necessities of the 
time," has meant that the United States, like other modern nations, has 
experienced during the last century a great transition. Before the steam 
engine, the locomotive, the automobile, the telephone, the radio, the airplane, 
and other marvels of science and technology made our civilization what it is, 
the responsibilities of government were not only quite limited but on the 
whole largely negative in character. So great, however, and so unsettling 
has been the impact of scientific inventions upon the conditions under which 
the vast majority of people live and work that the police activities of govern- 
ment have long come to be overshadowed by others of a more positive 
character. The police state of former times has retreated to make room for 
the service or welfare state; yet in a sense the two still exist side by side. 

The nature of this transformation may be seen very plainly in the tre- 
mendous expansion of municipal administration. Cincinnati and Detroit, 
during the period from the early 1800's down to the 1930's grew from com- 
munities whose municipal services could be numbered on the fingers of one's 
hands to metropolitan regions whose services totaled between three and 
four hundred. And the end is not yet. The log of administrative develop- 
ment of both these cities makes it clear that protection of life and property 



THE GROWTH OF PUBLIC ADMINISTRATION 19 

continues to be an important municipal responsibility. It demonstrates even 
more conspicuously, however, that it is activities in the fields of health, utili- 
ties, education, recreation, and social welfare which mainly absorb the 
energies of urban government in the present age. 10 

Comparative studies of state and county governments likewise show up- 
ward trends in the number and variety of their administrative activities. 11 
The rate of increase, however, is here markedly lower than in the case of 
municipalities, owing to the fact that the main currents of modern life 
the trends toward national economic organization and urban residence 
have affected states and counties to a lesser degree. In the case of the national 
government the trend line rises steeply. Comprehensive statistical indices 
are available only for selected periods; but the crude data themselves give 
eloquent testimony of the steadily increasing use the American people have 
made of their central government. 12 Annual budget expenditures and 
civilian personnel figures have both risen at rates far in advance of the rate 
of population growth. While the following table does not suggest the nature 
of the new responsibilities the national government has acquired in recent 
decades, it does afford some indication of the extent to which the volume of 
governmental activities has grown. 

INCREASE IN NATIONAL POPUIAIION, ANNUAL EXPENDITURES AND ADMINISTRATIVE 
PERSONNEL BY Di CADES DURING THE CENTURY 1840-1940 

Annual Expenditures 



Vear 

1840 

1850 

1860 ... ... 

1870 
1880 . 
1890 

1900 . 

1910 ... 

1920 

1930 
1940 

* U. S. Bureau of the Census, Sixteenth Census of the United States, 1940: Population, 
Vol. 1, p. 6, Washington, 1942. 

**U. S. Secretary of the Treasury, Annual Report, 1943, pp. 466-471, Washington, 1944. 

***U. S. Bureau of the Census, Statistical Abstract of the United States, 1943, p. 165, 
Washington, 1944. The figures given are for the years 1841, 1851, 1861, etc. 



ipulation of 


of the National 


Civilian Employees 


'ontinental 


Government, excluding 


in the Federal 


Mted States* 


debt retirement** 


Executive 


n millions) 


(in dollars) 


Service*** 


17.0 


24,317,579 


23,700 


23.2 


39,543,492 


33,300 


31.4 


63,130,598 


49,200 


38.6 


309,653,561 


53,900 


50.2 


267,642,958 


107,000 


63.0 


318,040,711 


166,000 


76.0 


520,860,847 


256,000 


92.0 


693,617,065 


391,350 


105.7 


6,403,343,841 


562,252 


122.8 


3,440,268,884 


588,206 


131.7 


8,998,189,706 


1,370,110 



10 Cf. Upson, Lent D., The Growth of a City Government, Detroit: Bureau of Municipal 
Research, 1931; Cincinnati Municipal Reference Bureau, Cincinnati (1802-1936): The March 
of City Government, Cincinnati, 1937. 

11 For a charting of the administrative growth of state government, see Hurt, Elsey, 
California State Government: An Outline of its Administrative Organization from 1850 to 
1936. 2 vols., Sacramento: California State Printing Office, 1937-1939. 

12 See Wooddy, Carroll H., The Growth of the Federal Government, 1915-1932, New 
York: McGraw-Hill, 1934. This study was published as one of the monographs supporting 
the report of President Hoover's Commission on Recent Social Trends. 



20 THE GROWTH OF PUBLIC ADMINISTRATION 

The salient fact about the character of the newer activities of the federal 
government namely, that they are designed to cope with the impact of 
technology on American society is patent from the names of some of the 
principal agencies which have been created since the turn of the century. A 
partial list would include: Department of Commerce (and Labor), 1903; 
Department of Labor, 1913; Federal Reserve System, 1913; Federal Trade 
Commission, 1914; United States Tariff Commission, 1916; Federal Power 
Commission, 1920; Federal Communications Commission, 1934; Securities 
and Exchange Commission, 1934; National Labor Relations Board, 1935. 
Each of these agencies was established to deal with specific problems, and 
each has in some measure accomplished the purpose for which it was created. 
Obviously, however, we have not reached the end of the road. New prob- 
lems have arisen since the youngest of these agencies was brought into being. 
Others will arise in the future. 

In organizing an agency to deal with a particular issue, the President and 
Congress or a governor and a state legislature, a mayor and a city council 
may dispose of that immediate issue, but often at the price of various 
procedural irritations within the administrative system as a whole. It is 
invariably something of a problem to coordinate the work of a new agency 
with that of older units doing related work. Especially where there is no 
attempt to weigh the advantages of alternative methods of organization and 
operation, the problem of coordination can become quite troublesome. 

4. INCREASING COMPETENCE FOR INCREASING RESPONSIBILITIES 

Even a brief survey of the growth of public administration would not be 
complete without some mention of the advances and adjustments which 
have been made within the system to enable it to handle the increasing load 
it has had to carry. Nor can we leave the subject without some appraisal of 
government's administrative capacity for sustaining the burdens likely to 
be thrust upon it in the future. Let us, therefore, now take note of the peren- 
nial struggle that has been waged in American administration for competent 
personnel; of the major gains registered in the fields of administrative struc- 
ture and procedure; of the effects produced and problems generated by 
national emergencies; and of the implications for public administration aris- 
ing from the expectations of the American people themselves. 

Professional Versus Amateur. Concerned as it is with means rather than 
ends, administration is a phase of government in which accomplishment can 
be measured with a degree of objectivity. It is, moreover, a phase in which 
it is possible to describe with relative precision the particular qualities or 
abilities which individuals ought to have for the positions to which they may 
be assigned. It might, therefore, be supposed that a system could have been 
established early in our history whereby appointments to positions in the 
public service would have been conditioned upon demonstration of the skills 
or talents required for the proper performance of official duties. 



THE GROWTH OF PUBLIC ADMINISTRATION 21 

The facts do not bear out this supposition. Whether, as some say, because 
we are democratically inclined, or because of other reasons, the great ma- 
jority of the American people have always had a pronounced preference for 
amateur government. Wanting in general only so much governance as 
seemed absolutely necessary to take care of recognized public interests and 
concerns, and eager to keep that bare minimum securely under their own 
control, they have experimented with a variety of arrangements for organiz- 
ing the public service. One device, still widely used in state and local govern- 
ment, is that of placing so many offices on an elective basis that the electorate 
is compelled or, according to the logic of this philosophy, privileged to 
choose not only its political representatives but a considerable body of admin- 
istrative officials as well. A second formula, now for the most part happily 
abandoned, was that of annual elections, based on the theory that where 
short terms end, tyranny may begin. Rotation in office comprised a third 
approach, which has been fraught with so much peril to efficiency in admin- 
istration that it warrants speciaK^ittention. 

Washington and Adams, the\ first two presidents of the United States, 
prided themselves on being goocf^ republicans but neither claimed to be a 
democrat in the Jeffersonian sense. Believing that politics and administra- 
tion were for the established social elite of their day "the rich, the well- 
born, and the able" they pursued personnel policies similar to those of the 
more enlightened prime ministers of Britain during the late eighteenth 
century. They took it ,for granted as did also John Quincy Adams later 
that the best families bf the country should and would inspire their ablest 
sons to seek careers in the government service. In consequence, they had 
little doubt that a president determined as both of them were to draw 
into the public service men of talent would not encounter any difficulty in 
recruiting and retaining an able and devoted staff. 

AHoVving for Jefferson's deep distrust of social station, his inherent inclina- 
tions wye also toward "talent and virtue" seeking public office; so were 
those of Madison and Monroe, his successors in the White House. How- 
ever, following his election in 1800, Jefferson discovered that two practical 
considerations obliged him to dismiss a number of Federalist appointees and 
replace them with Republicans. One was the inability of some of the Fed- 
eralist holdovers to convince Jefferson that they could be depended upon 
to show no less zeal in carrying out Republican policies than they had in the 
service of Washington and Adams. The other was the pressure for posi- 
tions put upon the new President by members of his own party. 

Originally, the principle of rotation in office was virtually limited in 
practice to legislative offices, but agitation arose early in the history of the 
Union for its application to administrative offices as well. Congress adopted 
in 1820 the famous Four Years Law. This act provided that federal district 
attorneys, collectors of customs, naval officers, money agents, registrars of 
land offices, paymasters in the army, and several other classes of officials 



22 THE GROWTH OF PUBLIC ADMINISTRATION 

should serve four-year terms rather than at the pleasure of the President, 
as they had formerly. 13 Even without this law, it is more than likely that 
Andrew Jackson during his administration (1829-1837) would have man- 
aged to dismiss a considerable number of the Whigs he found in the executive 
branch at his inauguration. There can be little doubt, however, that the law 
helped him to effect those changes in public personnel he thought necessary 
to place the government under the control of "the people" that is, those 
who had voted him into office. The four-year rule was later modified; but 
it contributed materially to the establishment of the spoils system in the 
United States. For half a century, from the 1830's to the 1880's, the over- 
whelming majority of appointments in American administration national, 
state, and local were made on the basis of party patronage. 

Patronage and Economy. During the early decades of the middle 1800's, 
the functions of government continued to be limited in volume and relatively 
simple in character. American genius for muddling along being not inferior 
to that of the British, it was possible even later on for the public business 
to be transacted tolerably well by politically selected amateur employees 
working under loose organization and utilizing casual procedures. But that 
age came to an end. After the Civil War, the new materialism of indus- 
trialization, economic instability and insecurity, the loosening of personal 
ties as a result of increasing urbanization, the opportunities for graft on a 
grand scale latent in municipal construction and utilities, and the mounting 
necessity for professionally trained personnel to handle the new technical 
functions and services of government all these led to conditions which 
made reform imperative. 

Disclosures of inefficiency and corruption touching every level of admin- 
istration aroused cities and states and the nation itself to a reexami nation of 
democracy long overdue. Gradually a demand emerged for the establish- 
ment and enforcement of higher standards of official competence and for 
tighter procedures wherever public moneys or properties were involved. 14 
However, indignation over ineptitude or wrongdoing was not the prime 
factor in the imposition of new controls. Rather, as the cost of government 
increased with additional functions of a technical nature, inefficient adminis- 
tration led to disproportionately heavier taxation which the public could less 
well afford to ignore. 

In national administration, the milestones marking the progress of reform 
were the Pendleton Act inaugurating the rule of merit in the recruitment of 
public personnel (1883); the expansion of the new civil service by executive 

13 Sec Fish, Carl Russell, The Civil Service and the Patronage, p. 66, Cambridge: Harvard 
University Press, 1920. This is the leading study of the history of national personnel policies 
and practices during the nineteenth century. 

14 Cf. StefTens, Lincoln, The Struggle for Seif -Government, New York: Doubleday, 1906, 
being an attempt to trace American political corruption to its sources in six states of the United 
States; Foulke, William D., Fighting the Spoilsmen, New York: Putnam, 1919; Lynch, 
Dennis T., Boss Tweed, New York: Boni & Liveright, 1927. 



THE GROWTH OF PUBLIC ADMINISTRATION 23 

orders under Presidents Cleveland and Wilson; the Classification Act initiat- 
ing a more uniform position structure in federal employment (1923); the 
report of the Commission of Inquiry on Public Service Personnel (1935); 
and the report of the President's Committee on Civil Service Improvement 
chaired by Justice Reed (1941). Corresponding improvements in personnel 
administration were accomplished within their own jurisdictions by the 
more progressive states and cities. 

Advances in Structure and Procedure. In line with these efforts toward 
building a professionally competent and politically nonpartisan civil service 
have been equally important improvements in administrative structure and 
procedure. Congress on several occasions took action in the interest of better 
administration. It gave support to the Commission on Economy and Effici- 
ency under President Taft by creation of a Bureau of Efficiency (1913-1933). 
It greatly enhanced executive control over the departmental system and 
strengthened fiscal accountability by passing the Budget and Accounting 
Act (1921). By giving President Roosevelt a measure of discretion in the 
Reorganization Act of 1939, Congress enabled him, just before the outbreak 
of World War II, to simplify the structure of the executive branch and 
organize his own office in line with the recommendations of the President's 
Committee on Administrative Management. 15 Similar powers were granted 
in the Reorganization Act of 1945 in order to adjust the wartime develop- 
ment to peacetime needs. 

Under the Reorganization Act of 1939, the more than one hundred agen- 
cies of the federal "administrative branch" were for the most part excepting 
especially the so-called independent boards and commissions regrouped 
into the ten departments and three new combined agencies for social wel- 
fare, public works, and public lending. Still more important, the President 
as administrator-in-chief was buttressed by provision for several administra- 
tive assistants and by the establishment of his own executive office in which 
he found his "arms of management" for budgeting, planning, and per- 
sonnel. The need for subsequent innovations was recognized in the creation 
of an Office for Emergency Management as a division of the Executive 
Office of the President. Most of the great control agencies of World War II 
were nominally placed within the Office for Emergency Management. 

Three main developments symbolize the progress made in raising the 

15 No official publication contains more valuable material on American public administra- 
tion, whether from the standpoint of analysis or information, than the report of the President's 
Committee on Administrative Management and its supporting documents, Washington, Govern- 
ment Printing Office, 1937. Louis Brownlow served as chairman of the President's Committee, 
and Charles E. Merriam and Luther Gulick were its other two members. Although Congress 
eventually authorized the President to proceed with many of the committee recommendations, 
the Reorganization Act of 1939 at the same time imposed considerable restrictions. Because 
of the "great debate" among the experts over the auditing function, one should read, along 
with the Brownlow Report, the report of the Brookings Institution to the Senate Committee 
(Senator Byrd, chairman) set up to investigate the executive agencies of the federal government, 
Senate Report No. 1275, 75th Cong., 1st Sess., Washington, 1937, 



24 THE GROWTH OF PUBLIC ADMINISTRATION 

level of efficiency in state administration. Beginning with Illinois under the 
leadership of Governor Frank O. Lowden in 1917, approximately half the 
states in the Union have taken action to unify their administrative organi- 
zation under the governor. Most of the states have also been obliged to give 
special consideration to the caliber of management attained by particular 
state departments in order to qualify for the increasing number of grants-m- 
aid available from the national government. Lastly, the states have begun 
to make it a practice, chiefly through the Council of State Governments, 16 
to exchange information and experience on all kinds of administrative prob- 
lems. 

The principal improvements in local administration relate, on the whole, 
either to various phases of municipal affairs or to public education. In the 
field of urban government, they include the formation in 1894 of the National 
Municipal League; the strengthening in many mayor-council cities of the 
appointive and directive powers of the mayor; the impulse given to better 
municipal management, chiefly during the decade from 1905 to 1915, by the 
novel commission form of city government; the movement for organized 
municipal research which started with the establishment of the New York 
Bureau of Municipal Research in 1906; the widespread drive, commencing 
more than a generation ago, for the introduction of systematic methods of 
municipal budgeting and purchasing; the growth of the council-manager 
plan of city government in the wake of agitation for the commission plan; 
and the formation over the past three or four decades of national profes- 
sional associations of all major groups of local administrative officials, culmi- 
nating in the establishment in 1931 of the Public Administration Clearing 
House, which at 1313 East 60th Street in Chicago has become an unofficial 
capitol for state and local administration throughout the country. 17 

Three lines of advance, again, describe the progress in educational admin- 
istration. These are the well-nigh universal development of the superin- 
tendent of schools into the chief administrative officer of the local school 
system; the formation of the National Education Association and other 
professional organizations; and, finally, the movement for school districts 
both large enough in pupil population and strong enough in financial re- 
sources to operate programs conforming to acceptable minimum instruc- 
tion standards. No substantial improvement can thus far be registered for 
rural administration in general. This is probably due to the fact that, as 
some of the more important rural functions were partially shouldered by the 
state, the county continued to give reasonably satisfactory service. 

16 The publication program of the Council of State Governments includes the magazine 
State Government and a periodically issued handbook entitled The Boo% of the States. 

17 Aside from such sources of current information about local administration as the 
National Municipal Review (published by the National Municipal League), the monthly Public 
Management, and The Municipal Yearbook (both put out by the International City Managers 
Association), mention should be made of the official organs of thr various functional asso- 
ciations within and without the "1313" group. 



THE GROWTH OF PUBLIC ADMINISTRATION 25 

Impact of Emergencies. As tragedy is the test of character in personal 
life, so crisis is the test of capacity iri administration. Accumulation of 
abuses in both public and private areas threatened to produce a partial gov- 
ernmental crisis in the United States during the decade preceding the open- 
ing of World War I. It was largely forestalled by a series of reforms 
embodied in what Theodore Roosevelt liked to call his Square Deal, by 
Taft's adherence to "T. R.'s" trust-busting program, and more fully by the 
measures adopted as a result of Woodrow Wilson's campaign for the New 
Freedom. However, the coming of World War I, particularly America's 
entrance into the conflict, put the nation's resources in public administra- 
tion to a substantial test. The country was required on short notice to draft 
and train a vast army, produce enormous quantities of food and war ma- 
terials, and raise billions of dollars in loans and taxes. The measure of suc- 
cess achieved may be taken from the subsequent appraisal by the vanquished 
enemy, "They knew how to wage war." Yet World War I had only one 
significant permanent effect on public administration: the executive branch 
never returned to its prewar dimensions either from the standpoint of the 
number of agencies and government employees or that of its over-all size. 

The impact upon public administration of the Great Depression was 
more momentous because many of the measures taken to cope with it were 
looked upon as presaging profound changes in the "American system" or 
the national "way of life." Moreover, the economic crisis affected every level 
of government and nearly every community, urban and rural, throughout 
the country. The emergency called for a vast enlargement of the nation's 
administrative machine and for the exercise of new powers pointing in the 
direction of greater governmental responsibility for the maintenance of the 
social and economic structure. Demanding closer collaboration between 
Washington and the states, between the states and the localities, and between 
the localities and Washington, the emergency also forced something of a 
transformation within the American governmental system. Competitive 
federalism began to yield by degrees to cooperative federalism. 

How far these changes went and what their permanent effects were 
destined to be are questions to which there are no precise answers. World 
War II overtook the United States before the nation had pulled itself com- 
pletely out of the pit. Instead of shrinking in size or authority, govern- 
ment was vested with greater powers and obliged to expand its activities 
and personnel beyond any precedent. The end of the war allowed consid- 
erable reductions, but under the auspices of a policy of high-level employ- 
ment we may expect the role of government to remain an extremely impor- 
tant factor in support of national prosperity and well-being. 

Tas{s of Administration in Mid-Century. America in the middle twen- 
tieth century will not and can not return to the old order, be it that of 
1929 or 1939. No nation can safely go back; ours does not want to go back. 
The memory of insecurity and unemployment lingering on from the late 



26 THE GROWTH OF PUBLIC ADMINISTRATION 

1930's and the knowledge of greatly increased productive capacity developed 
during World War II have combined to make Americans reject a mere 
"return to normalcy." They want a world in which a strong international 
organization can and will prevent war. And such international organization 
has implications for American public administration. The people also want 
"full employment." Their determination to attain stable employment means 
that in the period ahead public administration may be asked to carry bur- 
dens harder and heavier than those it has ever carried during the past. 

The American economy is today a mixed economy a blending of pri- 
vate and public undertakings. This interlocking calls for wise public policy 
and sensitive administration. The public is looking to government for 
assurance that the national economy will be kept operating at high levels 
of production and employment. This requires governmental guidance in 
fiscal policy and carefully planned adjustments at many points of the 
economy. 18 Here is a challenging mandate for responsible administration, 
but one that can be met as unparalleled war needs have been met. 

As the nation approaches mid-century, the crucial question is not whether 
its public administration will be adequate and efficient, but whether its 
governmental policies will be sound and enlightened. The danger is not 
that we might adopt plans and programs so ambitious that government 
would be unable to find administrators capable of their execution. Rather 
it is that cleavage and confusion among the people, fostered by selfish 
groups bent only on their special interest, might destroy the common basis 
on which elected representatives could agree on a constructive policy for the 
promotion of the general welfare. 

18 Cf. Morstun Marx, Fritz, eel., "Maintaining High-Level Production and Employment: 
A Symposium," American Political Science Review, 1945, Vol. 39, pp. 1119-1179. 



X X X X- X ********************* ************** ************** 



CHAPTER 



The Study of Public Administration 

1. THE WORK OF THE PIONEERS 

Beginnings of Administrative Research. Public administration empha- 
sizes the value of the contributions in executing public policy of men and 
women who, through experience or study, have developed a considerable 
degree of skill in the administrative process. This process includes: the 
designing of appropriate administrative structures and the organizing of 
their component units; the formulating of work programs, standards of 
performance, and ways of measuring results; the budgeting of public rev- 
enue and expenditures and the accounting for funds; the recruiting, train- 
ing, and directing of a suitable staff; the assumption of responsibility for the 
conduct of operations on the one hand and for planning proposed policy 
changes on the other; and the making of proper arrangements for the con- 
duct of relations with other administrative agencies, the legislature, private 
individuals, organized groups, and the general public. 1 

Consideration of these various elements may suggest the existence of an 
extensive body of cumulative experience, study, and analysis. However, 
as an organized field of knowledge, public administration in the United 
States is only forty years old, if its birth date is accepted as 1906, the year 
the New York Bureau of Municipal Research was established. 2 Creation of 
the New York Bureau symbolized the beginning of a profession and a 
science of administration in three essential respects: accumulation of 
descriptive materials about the purposes, powers, structure, and functioning 
of governmental agencies; application of analytical techniques and techni- 
cal standards; and employment of a full-time expert staff, prepared to accept 

1 For a full discussion of the range and the elements of the administrative process in this 
sense, see Gaus, John M. and Others, The Frontiers of Public Administration, ch. 1, Chicago: 
University of Chicago Press, 1936; Gulick, Luther and Urwick, Lyndall, cds., Papers on the 
Science of Administration, New York: Institute of Public Administration, 1937. 

2 See Weber, G. A., Organized Efforts for the Improvement of Methods in Administration, 
Introduction (by W. F. Willoughby) and ch. 1, Washington: Institute for Government 
Research, 1919. 

27 



28 THE STUDY OF PUBLIC ADMINISTRATION 

responsibility for recommending specific measures for the improvement of 
administrative organization and management. For more than ten years 
the New York Bureau made studies and reports covering almost all the 
municipal activities of the city. Its methods of establishing working rela- 
tionships with the city government, of developing productive opportunities 
for investigation, and of getting its recommendations adopted not only 
constituted the earliest American experience in continuing administrative 
research but also set a prototype for use throughout the country. 3 

Waves of Government Reform. The research-bureau movement, of 
course, did not materialize suddenly out of thin air. It developed after a 
period of more than twenty years of political agitation and experimentation 
with political "reform." Most of the reformers were people who, though 
unwilling or unable to go into politics themselves, thought that the political 
life of the nation should be purified and that "better" men should enter 
public service. The reformers included such advocates of the merit system 
in government employment as Carl Schurz and Dorman B. Eaton; jour 
nalists and publicists like E. L. Godkin, Henry Adams, and Henry Dem- 
arest Lloyd; and practical businessmen, lawyers, clergymen, teachers, and 
other citizens who organized city clubs to promote "good government." 
These individuals and civic-minded groups left a lasting legacy in the 
formation and the working approach of our civil service commissions, and 
other devices of reform. Their political activities were less successful. Al- 
though they helped to elect "good" candidates to office in many cities, 
usually these men were voted out soon and the party bosses came back into 
power. Lacking broad sympathetic support, the independent civil service 
commissions were in such instances often controlled or isolated by partisan 
forces. 

Thoughtful analysis of these experiences resulted, around the turn of 
the century, in several more or less systematic inquiries into the facts of 
governmental life. One form of governmental research was represented by 
the brilliant newspaper and magazine reports of the "muckrakers," whose 
exposure of the deeper economic roots of political corruption had a wide if 
short-lived influence. 4 Characteristic realism and a propensity for quick 
generalization led these writers to take the simple position that the economic 
system controlled the politicians; that the politicians controlled civil service 
commissions and operating officials; and that the remainder of public 
administration, insofar as it was not dishonest or corrupt, was simply the 
unimportant routine execution of public business. 

Organized Dissemination of Knowledge. Another type of research ex- 
pressed itself in the collection and dissemination of information on munici- 

3 See Gill, Norman N., Municipal Research Bureaus, Washington: American Council on 
Public Affairs, 1942. 

4 Stefrens, Lincoln, Autobiography, New York: Harcourt Brace, 1931; Whitlock, Brand, 
Forty Years of It, New York: Appleton, new ed., 1925; and the autobiographies of Robert M. 
LaFollcttc, Sr., and Theodore Roosevelt. 



THE STUDY OF PUBLIC ADMINISTRATION 29 

pal facts and events by the National Municipal League, founded in 1894, 
and the formulation by chat body after 1900 of its standard "model laws" 
for the organization and powers of local and state governments. The 
research activities of the League and the more active promotional tactics 
of its offshoot, the National Short Ballot Organization, were of great assist- 
ance to the developing profession of public administration. On the whole, 
however, these and similar private organizations concentrated on reporting 
developments in better government structure and the framing of charters, 
ordinances, and constitutions. They tended to leave the study and im- 
provement of administrative management, processes, and standards to 
"technicians." 5 

Role of Progressivism. A third type of governmental research was asso- 
ciated between 1S% and 1912 with the political movement called Progres- 
sivism. Progressivism has often been identified with the personalities of 
its leaders. One common bond between them was the conviction that if 
new policies of economic regulation were to be made to stick, those policies 
must be removed from the hands of legislative bodies and administered by 
expert boards on the basis of technical investigation and nonpolitical deter- 
mination of the facts. Early systematic thinking about the independent 
regulatory commission was linked with Progressivism in the states, and in 
at least one state, Wisconsin, it was based on close collaboration between 
the state capitol and the state university. This collaboration made pos- 
sible in 1901 the establishment of one of the first legislative reference libraries 
in the United States. It also paved the way for considerable research and 
participation by university professors in the drafting of state legislation. 
The ensuing period witnessed the initial establishment in many states of 
effective legislation regulating public utilities, workmen's compensation, 
conservation of natural resources, and conditions of employment. 

If the trends inherent in the progressive movement prior to 1912 had 
continued, perhaps the study of public administration would have developed 
on a subject-matter basis, as separate scries of professional or expert tech- 
niques, each peculiar to a distinct area of economic policy. What actually 
happened, however, was something different. Development of the theory 
of the administrative process exemplified by the independent regulatory 
commission was largely taken over by the economists and lawyers, while 
the political scientists divided themselves into two groups. One group busied 
itself with structural problems in the relations between the federal govern- 

5 For a valuable survey, see the Fiftieth Anniversary Issue of the National Municipal 
Review, November 1944. 

<* Cf. Croly, Herbert, Progressive Democracy, New York: Macmillan, 1915, which is perhaps 
the best statement of i's political program. See also Chamberlain, John, Farewell to Reform, 
New York: Viking, 1933; Bowers, C. G., Beveridge and the Progressive Era, Boston: Hough ton 
Mifflin, 1932. Progressivism was really faith in a method, rather than a coherent philosophy 
or economic program, coupled with an abiding belief that the people would support expert 
administration if properly led and given the facts by responsible political leaders. 



30 THE STUDY OF PUBLIC ADMINISTRATION 

ment and the states, state control over local government, political executives 
and the legislative body, and the proper organization of the executive 
branch. The other joined forces with the municipal research-bureau move- 
ment in the conviction that progress toward good government would follow 
only from full-time detailed study and technical analysis of the methods of 
conducting the government's business. 

Contribution of the Universities. The contribution of the universities to 
the rise of public administration was rather indirect, with the exception of a 
few outstanding individuals. Woodrow Wilson contributed his pioneer 
paper entitled "The Study of Administration" to the infant Political Science 
Quarterly in 1887. James Bryce is said to have drawn heavily upon the 
series of Johns Hopkins studies in historical and political science (beginning 
in 1882), as well as upon the services of Professor Frank J. Goodnow, in 
preparing his influential American Commonwealth (1888). Many students 
of Simon Patten at the University of Pennsylvania, Richard T. Ely and 
John R. Commons at Johns Hopkins and Wisconsin, A. L. Lowell at 
Harvard, and of the faculty of History, Government, and Public Law at 
Columbia University, later distinguished themselves in the practice and 
literature of public administration. However, during the earlier period the 
study of government and politics was just disentangling itself in the college 
curriculum from philosophy, political economy, and a jurisprudence domi- 
nated by the private law of property. 7 

The academic progenitors of public administration in the eighties and 
nineties were economists, political scientists, and sociologists who taught 
their students how to analyze the economic and political processes through 
which public authority is exercised, without much speculating about the 
concepts of political philosophers and supreme court judges. Even so, 
legal materials constituted so much of the subject matter with which stu- 
dents of government dealt in those days that Goodnow, who is generally 
considered the father of American public administration, wrote most of his 
books in the fields of administrative and constitutional law. 8 If it is con- 
ceded that a true profession of public administration could not have arisen 
until after trained men began to study at first hand the working processes 
of government, then contemporary students surely owe to their academic 
forefathers a large debt for their critical and realistic temper, their aware- 

7 See Beard, Charles A., Economic Interpretation of the Constitution, Introduction, New 
York: Macmillan, rev. ed., 1932; Dorfman, Joseph, Thorstein Veblen and His America, esp. 
chs. 3-6, New York: Viking, 1934; Merriam, Charles E., American Political Ideas 1865-1917, 
New York: Macmillan, 1920. 

8 See Fairlie, John A., "Public Administration and Administrative Law," ch. 1, in Haines, 
Charles G. and Dimock, Marshall E., cds., Essays on the Law and Practice of Governmental 
Administration, Baltimore: Johns Hopkins Press, 1935. 



THE STUDY OF PUBLIC ADMINISTRATION 31 

ness of the institutional determinants of public policy, and their distrust of 
the legalistic approach. 9 

2. THE ADVANCEMENT OF KNOWLEDGE 

Relativity of Efficiency. Full-time research bureaus were established 
in twelve large cities between 1906 and 1915. Their slogan was efficiency 
and economy. The experience of their staffs in administrative research 
soon revealed the fugitive nature of this objective, when conceived as 
a source of immediate reduction in governmental expenditure. It was dis- 
covered that efficiency and economy had to be achieved primarily as a 
by-product of getting at the basic facts of administrative purpose, structure, 
and procedure. Leaving out instances of outright venality and political 
privilege, it was found that there was always a certain degree of efficiency 
in existing methods and routines. Apart from the question of whether a 
given function should or should not be performed, the goal of efficiency 
and economy raised the question of purpose that is, whether procedures 
were to be considered from the limited standpoint of particular operators 
and particular interests or from that of the public purpose the individual 
agency was supposed to achieve. Thus research-bureau workers were led to 
a search for principles of management in order to secure acceptance for 
those practices which advanced the purpose of the organization as a whole, 
as compared with procedures and habits which had grown up for historic 
reasons or had been established by operators with narrower objectives in 
view. 

For example, from the angle of a municipal department head, it might 
be preferable to go directly to the city council for funds. Broader perspec- 
tive would be necessary for him to envision the advantages of budgetary 
coordination at a central point. Yet only thus could a balanced consideration 
of the work plan of the city government as a whole be attained before 
submitting the estimates of expenditure to the council. In the same way, 
individual officials did not mind the scattering of similar functions among 
several agencies and the existence of varying methods of performing similar 
operations by different organizations. Yet there was obvious merit in the 
principle that functional consolidation and establishment of uniform stand- 
ards be secured in the larger interest, even at the expense of particular offi- 

9 Organizations of public officials such as state and local health officers, police chiefs, 
superintendents of insurance, and tax and educational administrators existed before 1906. 
These early organizations were in many cases more social groups than promoters of research 
in the standards of their profession, however; and they were separatist and vocational in 
interest. See White, Leonard D., Introduction to the Study of Public Administration, ch. 27, 
New York: Macmillan, rev. ed., 1939, and Trends in Public Administration, chs. 20, 22, 
New York: McGraw-Hill, 1933. Earlier events and personalities in the literature of public 
administration are discussed in Gaus, John M., A Memorandum on Research in Public Ad- 
ministration, Social Science Research Council, 1930, unpublished; Short, Lloyd M., The 
Development of National Administrative Organization in the United States, Washington: 
Institute of Government Research, 1923. 



32 THE STUDY OF PUBLIC ADMINISTRATION 

cials who might have achieved considerable efficiency within their own 
operations. Economy was not simply a matter of eliminating functions 
or services, most of which were ardently supported by citizen groups, but 
one of giving proper consideration to the specific question of whether 
particular expenditures were or were not justified. 

Use of Outside Experts. Thus administrative research tried to develop 
principles and techniques . of public management. The executive budget, 
personnel classification and salary standardization, and centralized pur- 
chasing all found systematic application and expansion in local governments 
in the decade following 1906. 10 It was wholly natural that Dr. Frederick 
A. Cleveland of the New York Bureau of Municipal Research was ap- 
pointed by President Taft in 1910 to direct the work of the United States 
Commission on Economy and Efficiency. The Commission and its staff 
for the first time applied to the entire executive branch of the federal govern- 
ment the full measure of painstaking research into administrative duties, or- 
ganization, procedure, and housekeeping methods, exhibiting in a long series 
of factual monographs the results of detailed legislative control over the de- 
partments. In his final report, Dr. Cleveland formulated what is perhaps 
the classic statement of the purpose of the executive budget as a scientific tool 
of administration, 11 a contribution which laid an early foundation for the 
Budget and Accounting Act of 1921. Similarly, the Congressional Joint 
Commission on Reclassification of Salaries drew heavily upon the experience 
of the local research bureaus in their work of job description and classifica- 
tion; on that foundation was built the scheme embodied in the Classification 
Act of 1923 a guidepost for federal personnel administration. 1 " 

The drive for administrative reorganization of state governments began 
in 1909. Staff work and reports in preparation for the New York and Illi- 
nois Constitutional Conventions of 1915 and 1917 were notable especially 
for the quality and method of research. 13 These reports documented three 
early premises of organizational thinking: (1) concentration of responsibility 
by consolidating functions into a small number of departments, each headed 
by a single official appointed by and responsible solely to the chief executive; 
(2) functional integration by grouping similar or related activities into the 
same department; and (3) centralized controls over finance, government 
purchasing, and personnel. Executive responsibility for administration was 
the dominating theme. Coupled with the short ballot, the executive budget, 

i Cf. White, Trends (cit. in note 9), pp. 218-223, 255-257. 

11 "The Need for a National Budget," 62nd Cong., 2nd Sess., House Doc. No. 854, 
Washington, 1912. Cf. also his Organized Democracy, New York: Macmillan, 1913. 

12 Sec 66th Cong., 2nd Sess., House Doc. No. 686, Washington, 1920. Cf. also Per- 
sonnel Classification Board, Closing Report of Wage and Personnel Survey, Washington: 
Government Printing Office, 1931. 

13 Cf. Buck, A. E., The Reorganization of State Governments in the United States, New 
York: Columbia University Press, 1938; Holcombe, Arthur N., State Government, New York: 
Macmillan, 3d ed., 1931; New York Bureau of Municipal Research, New Yor% State Constitution 
wd Government: An Appraisal, New York, 1915. 



THE STUDY OF PUBLIC ADMINISTRATION 33 

and application of the merit system to all but politically appointed depart- 
ment heads, these main propositions conceived as principles were applied 
with variations in about half the states between 1917 and 1932. Many of 
the changes were based upon recommendations derived from surveys by 
three private organizations staffed with specialists in administrative analysis: 
the Institute of Government Research of the Brookings Institution (Wash- 
ington), the National Institute of Public Administration (successor to the 
New York Bureau of Municipal Research), and Griffenhagen and Associ- 
ates (Chicago). Their surveys usually resulted in thorough, factual reports, 
with recommendations based on intensive analyses and classifications of 
activities into major functions. Such reports were filed with the governors 
or legislative bodies for appropriate action. 14 

Entirely aside from the general rule that the professional staffs of investi- 
gators were to take no active part in getting their recommendations adopted, 
the principles recommended in most of the state surveys came in for quite a 
bit of criticism. It was questioned whether the political executive would 
have the time or inclination to become a general manager for administra- 
tion. The notion that the voters would ever choose their mayors, governors, 
or presidents on the basis of administrative competence was ridiculed. Doubts 
were raised as to whether the political head should be entrusted with author- 
ity over all finance and personnel matters. Finally, instances were pointed 
out in which there were persuasive reasons for preferring administrative 
boards over single-headed agencies. 17 ' This debate revealed the confusion 
and ambiguity of concepts and of scientific methods that had crept into the 
thinking of students of public administration. 16 

Challenge to Traditional Approach. By assuming a separation of policy- 
making from administrative efficiency, the investigators had tried to arrive 
at valid principles, at least on the technical level of operations. However, 
validity of principles depends upon agreement: (1) on the diagnosis of the 
problem; and (2) on the objective sought by the investigators. The argu- 

14 The capstone of this kind of outside survey work, in method and result, was the 
monumental study of the entire area of federal administration by the Brookings Institution for 
the Senate (Byrd) Committee Investigating Executive Agencies, 75th Cong., 1st Sess., Senate 
Report No. 1275, Washington, 1937. 

15 See Hyncman, Charles S., "Administrative Reorganization: An Adventure into Science 
and Theology," Journal of Politics, 1939, Vol. 1, p. 62 ff.\ Walker, Harvey, "Theory and 
Practice in State Administrative Reorganization," National Municipal Review, 1930, Vol. 19, 
p. 249 jf.', Coker, Francis W., "Dogmas of Administrative Reform," American Political Science 
Review, 1922, Vol. 16, p. 399 ff. 

10 See Beard, Charles A., "Administration: A Test of Ideal and Power," ch. 10, in his 
Public Policy and General Weljarc, New York: Farrar & Rinehart, 1941. The best survey 
and analysis of the literature of public administration from a methodological standpoint is 
Waldo, C. Dwight, Theoretical Aspects of the American Literature of Public Administration, un- 
published Ph.D. thcsii at Yale University, 1942, esp. pp. 82-92 (scheduled for early publication). 
Cf. also Wallace, Scnuyler C., Federal Departmentalization , New York: Columbia University 
Press, 1941; Simon, Herbert A.. "The Proverbs of Administration," Public Administration 
Review, 1946, Vol. 6, p. 53 ff. 



34 THE STUDY OF PUBLIC ADMINISTRATION 

ments over state reorganization in the 1920's foreshadowed the famous 
conflict in 1937 and 1938 between the President's Committee on Adminis- 
trative Management and the Brookings Institution. Both situations illus- 
trate the degree to which broad agreement upon a great many concrete 
propositions for administrative improvement can be distorted by differences 
over the priority of problems and by the intrusion of political issues and value 
judgments which may or may not be relevant to specific proposals. The Pres- 
ident's Committee eschewed the survey method of functional analysis and 
classification which the Brookings Institution had utilized; it selected its ob- 
jectives in terms of the problems conceived by its sponsor and his advisers 
to be of compelling importance. Both its investigations and its recom- 
mendations sought to develop answers to these problems. 

The 1937-1938 debates have caused most students of administration to 
recast their notions of public management as a science of "principles." 
The conception of the scientific investigator one standing apart from his 
material of human beings while making his inquiries; collecting, sifting, 
testing, and weighing his facts and ultimately arriving at the most reliable 
conclusions has somehow been found problematical in governmental re- 
search. It was based in part upon Frederick W. Taylor's ideas of scientific 
management, 17 which called for the study and formulation of the proper 
methods of job performance in advance, followed by adjustment of the 
human factor to those methods. This approach or technique was de- 
veloped and applied to the details of specific job operations at the 
shop level by a trained engineer or superintendent within the factory 
hierarchy with authority over the workers. It lacks applicability to man- 
agement research into program questions. Conditions are different when the 
research staff is wholly outside the hierarchy of responsibility and has 
no powers or sanctions over the human element other than publicity and 
persuasion. The same is true when the purpose of analysis is not to improve 
job performance, but to achieve proper structural relationships. A different 
condition also prevails when the objective of study is not to help the operat- 
ing official do a better job, but rather is to change his job. Moreover, al- 
though being outside the government has certain advantages of freedom 
and public pressure, it presents extremely difficult problems in developing 
and maintaining working contacts with operating officials. Publicity is a 
one-shot weapon which, when improperly used, may result in the destruction 
of working relationships. 

Rise of Administrative Self -Analysis. Two main developments have 

17 Taylor's main work is The Principles of Scientific Management, New York: Harper, 
1919. See also Cookc, Morris L., "Influence of Scientific Management Upon Government," 
Bulletin of the Taylor Society, 1921, Vol. 9, pp. 31-38; Pearson, Norman M., "Fayolism As the 
Necessary Complement of Taylorism," American Political Science Review, 1945, Vol. 39, p. 
68 ff. 



THE STUDY OF PUBLIC ADMINISTRATION 35 

arisen to modify the methods of citizen research agencies. 18 One was sig- 
nified by the creation at Chicago in 1933 of the Public Administration 
Service. PAS emphasized the importance of work planning and scheduling 
in administrative operations. It also specialized in the development of units 
of work measurement and systems of administrative reporting which its staff 
stood ready not only to recommend but to install. 19 This approach was 
based on a conviction of the higher value of helping the administrator to 
meet his needs, rather than redrawing organization charts and reshuffling 
functions. 

The other source of competition with traditional administrative research 
is the development during the twenties and thirties at all levels of govern- 
ment of specialized staff facilities as official agencies of management research. 
The work of continuous study of governmental organization and operations 
as a basis for the annual scrutiny of departmental budget estimates; the 
supervision of the methods of approving and recording obligations and 
expenditures; the application of the personnel classification plan to the 
recruitment, selection, promotion and transfer of employees these and 
similar central staff activities are in sum a continuous process of research 
into the programs and methods of the various agencies. Perhaps the out- 
standing contribution of the President's Committee on Administrative 
Management was the way in which it highlighted the value of staff and 
control agencies as tools of coordination for the chief executive. Its report 
reviewed the federal experience of twenty years with the Bureau of Effi- 
ciency (1913-33) and laid the foundation for the program of the Budget 
Bureau's Division of Administrative Management after 1939. 

Consolidation of central responsibility for general efficiency in the agency 
of budgetary coordination symbolizes another aspect of strengthened gov- 
ernmental management. Staffs engaged in recurrent processes of agency 
coordination are stimulated by an energetic group of management-minded 
colleagues who are freed from day-by-day responsibilities to make intensive 
analyses of specific problems, supplementing the knowledge gained in or- 
dinary budgetary relationships with the operating departments. This 
catalytic function of a management staff, coordinated with the units of 
budgetary, statistical, and other government-wide controls in the Executive 
Office of the President, represents the latest development of federal ad- 

18 Cf. the discussion presented in "Better City Government," Annals of the American 
Academy of Political and Social Science, 1938, Vol. 199, pp. 171-189; Proceedings of the 
Governmental Research Association, Governmental Research and Citizen Control of Gov- 
ernment, Detroit, 1940. 

19 Ridley, Clarence E. and Simon, Herbert A., Measuring Municipal Activities, 2d. cd., 
Chicago: International City Managers Association, 1943; National Committee on Municipal 
Reporting, Public Reporting, New York: Municipal Administration Service, 1931; Public 
Administration Service, The Work Unit in Federal Administration, Chicago, 1937; Stone, 
Donald C., The Management of Municipal Public Works, Chicago: Public Administration 
Service, 1939. 



36 THE STUDY OF PUBLIC ADMINISTRATION 

ministrative planning. 20 It affords the President the benefit of a general- 
staff approach in the exercise of his administrative responsibilities. 

The decade of the thirties thus witnessed a shift of the center of gravity 
in governmental research from private citizen-supported agencies outside 
the government to central staff agencies within the government itself. 
At the same time, there rose a trend away from the idea of central agencies 
as direct controllers of line officials toward the concept of central assistance 
in line operations by clarification of administrative objectives, stimulation 
of work planning and scheduling, and cooperation with departmental 
managers in establishing units of measurement and standards of perform- 
ance. The information about agency activities derived from these processes 
makes available to the chief executive an invaluable flow of ideas divorced 
as nearly as may be from vested departmental interests. However, thus 
far the potentialities of executive staff planning as a focal point of leader- 
ship and direction in formulating substantive policy have not yet crystal- 
lized beyond stimulation, advice, and raising of issues. 21 

Reaffirmation of the Political Context. After forty years of research, 
development of tools of administrative analysis and control, and evolution 
of a professional spirit among students and practitioners of administration 
as such, it .is not surprising that speculation has arisen about the fitness of 
persons experienced and trained in the administrative arts to contribute to 
the formulation of policy. This is one of the great unsettled issues of ad- 
ministrative theory. General discussions about the "managerial revolution" 
have drawn attention to it, but have imputed a greater assurance and 
solidarity among the elements comprising the managerial groups than 
actually exists. The issue is bound up with other complex problems. These 
include: (1) the appropriate code of behavior in the area intermediate 
between the setting of administrative policy under law and legislative 
policy-making; (2) the proper balance between the judgments of subject- 
matter experts and line operators on the one hand and those of manage- 
ment planners and staff experts on the other; (3) the claims of the lawyers 
in the entire realm of law-making and rule-making; and (4) the nature of 
"bureaucratic ideology." On this last point, some feel that administrative 
agencies are responsible for achieving desirable social purposes and may 

20 Cf. Willoughby, W. F., Principles of Public Administration, ch. 5, Washington: Insti- 
tute of Government Research, 1929; Jump, W. A., "Budgetary and Financial Administration 
in an Operating Department of the Federal Government," Proceedings cit. in note 18, p. 78 ff.\ 
Stone, Donald C., "Federal Administrative Management, 1932-42," Transactions of the American 
Society of Mechanical Engineers, 1943, Vol. 65, p. 242 ff.; Macmahon, Arthur W., 'The Future 
Organizational Pattern of the Executive Branch," American Political Science Review, 1944, 
Vol.38, p. 11791?. 

21 For a discussion of policy planning as distinct from administrative planning, cf. Key, 
V. O., "Politics and Administration," in White, Leonard D., cd., The Future of Government 
in the United States, Chicago: University of Chicago Press, 1942. The wartime development 
of the Office of Economic Stabilization and the Office of War Mobilization and Reconversion 
is significant in the functional differentiation between the two forms of planning. 



THE STUDY OF PUBLIC ADMINISTRATION 37 

have to fight for them. Others think administrative agencies should con- 
fine themselves to getting their assignments done within the policies 
established by the legislative body. 

Discussion over the past fifteen years of such questions as those of ad- 
ministrative finality, administrative discretion, and administrative respon- 
sibility 22 reveals a shift in administrative research. Concern with technical 
expertness and specialized experience has yielded to study of the factors 
involved in the management of an organization and the objectives or values 
toward which governmental organizations should strive. The assumption 
of thirty years ago about the role of public administration in a democratic 
society is no longer controlling. Then the whole argument rested on the 
thesis that democracy and efficiency in administration were not incompatible. 
The question was how to make democratic administration efficient and 
effective in the face of arbitrary political interference in administrative 
matters. Today it is assumed that the criteria of efficiency in democratic 
administration are broader than and superior to technically sound procedure 
and financial economy in the execution of established policies. 

The importance of technical competence and professional standards is 
not underestimated. However, the tests of adequate administration are 
thought to go beyond the accomplishment of statutory purposes. It is 
argued that administrative activities should be studied with a view to de- 
fining emerging problems and developing policy recommendations to meet 
demands for new services or types of regulation. It was not a bureaucrat 
but a farsighted and successful businessman who pointed out that adminis- 
trative ability of the highest order is required for attainment of greater 
social unity the unity that comes from general understanding and satis- 
faction on the part of all groups with respect to the constructive planning 
and coordination of public services by their government. 23 

3. TRAINING FOR PUBLIC ADMINISTRATION 

Educational Aspects. The advancement and maturity of public ad- 
ministration as a profession may be appraised, apart from its assumptions 
and its techniques, by the types of training provided and the standards of 
admission required of aspirants for entrance. Of course, there is no 
single vocational group of administrators in the public service. This 



22 See Gaus and Others, op. cit. in note 1, chs. 6 and 7; Landis, James M., The Adminis* 
trative Process, New Haven: Yale University Press, 1938; Friedrich, Carl J., "Public Policy 
and the Nature of Administrative Responsibility,'* in Friedrich, C. J. and Mason, Edward S., 
eds., Public Policy, pp. 3-24, Cambridge: Harvard University Press, 1940; Finer, Herman, 
"Administrative Responsibility in Democratic Government," Public Administration Review, 
1940, Vol. 1, pp. 335-49. 

23 Dennison, Henry S., "The Need for the Development of Political Science Engineering," 
American Political Science Review, 1932, Vol. 26, p. 241 ff. See aho Merriam, Charles E., 
'The New Management," in his The New Democracy and the New Despotism, New York: 
McGraw-Hill, 1939. 



38 THE STUDY OF PUBLIC ADMINISTRATION 

service includes every profession and every skill within the range of func- 
tions and activities performed for the community. Yet proper training 
for government work has been a matter of deep interest among the organi- 
zations of public officials and the political science departments in colleges 
and universities all over the country. In the course of the last twenty-five 
years there has been an increasing crystallization of ideas and methods of 
approach. 

However diverse the forms of government action may be, the manage- 
ment of public business is recognized as a field of career activity for which 
it is possible to provide training and incentives to attract the highest 
ability in the population. In an authoritative survey, 24 Professor George A. 
Graham takes the position that training for public administration is not a 
special professional apprenticeship but part of the broad problem of edu- 
cational policy. Its ideal is continuous growth and widening experience 
for the able individual as he prepares himself to meet successive tests of 
competence for tasks of greater responsibility. To attract ability and talent 
into the public service, government, recruitment should be coordinated with 
graduation from the several levels of school and college. Public personnel 
agencies should encourage efforts on the part of government workers to 
advance themselves by providing training facilities both for appropriate 
specialization and for widening their intellectual horizons. 

Such a policy would not favor the establishment of a separate program 
in educational institutions emphasizing preparation for the public service 
exclusively. It would, on the contrary, foster efforts to establish a university- 
wide program of guidance, information, and flexible interdepartmental 
arrangements for selection of courses, standards of examination, and re- 
quirements of evidence of creative ability. 25 Similarly, after entrance into 
the public service, there would not be a special staff college for prospective 
government managers only. Rather, there would be a process of sifting, 
competition for opportunities, forward-looking supervision, and promotion 
across divisional or departmental lines, based upon a service-wide policy 
under the direction of the central personnel agency. 

Public administration is not identified by a distinctive technique of its 
own, a single type of activity, or a unified subject matter upon which 
agreement can be reached for purposes of establishing a special curriculum. 
On the contrary, at the undergraduate level, substantial agreement exists 
that a broad liberal education is the best prescription. It should include a 
realistic awareness of the operation of economic institutions and the role 
of government in modern society, supplemented if possible by some work 
in statistics or accounting. It should stress the ability to speak and write 

3* Graham, George A., Education for Public Administration, Chicago: Public Adminis- 
tration Service, 1941. 

25 Cf. Lambie, Morris B., cd., Training for the Public Service, Chicago: Public Adminis- 
tration Service, 1935. 



THE STUDY OF PUBLIC ADMINISTRATION 39 

the English language effectively. This would be a better preparation than 
training for a specific job. 26 In postgraduate work, all types of pro- 
fessional schools are potential sources of recruits for government work. 
Professional training in the natural sciences, engineering, education, medi- 
cine, social work, law, economics, and governmental research, culminating 
in professional degrees, is increasingly accepted as experience which civil 
service commissions will consider as qualification for intermediate positions 
in the classified service. In pre-entry training for public service, therefore, 
we find little disposition to provide a specific occupational preparation. 

Contrast with Great Britain. Since the University of Minnesota Con- 
ference in 1931, much attention has been devoted to the question of whether 
the elements of management constitute a subject matter that can be taught 
apart from application to technical fields of administrative activity such as 
public health, public works, public welfare; and, if so, whether it would 
qualify the student for administrative work. 27 Actually, no program of 
training for public service has attempted to teach the knowledge and art of 
management in a vacuum. Syracuse University, perhaps the outstanding 
example of a special program of graduate training aimed at government 
service, uses the block or "end-on-end" method of instruction to impart 
both the techniques of management and understanding of special areas of 
subject matter. Its graduates have found ready markets for their services, 
particularly in budget and personnel agencies. 

Recruitment for the civil service in the United States has never followed 
the lines recommended by the Northcote-Trevelyan and Macaulay reports 
for Great Britain in 1853-54. 28 These reports advocated the recruitment of 
the top men in the graduating classes of the British universities, regardless 
of the subject of specialization, for the highest administrative positions in 
the civil service, coupled with a suitable period of post-entry training and 
qualification. In this country, at least up to 1934, the policy of civil service 
recruitment has been based upon the assumption that government work 
can be classified into occupational groupings within vertical services. After the 
amount of training and experience required for the job classification within 
each such service has been determined, qualified applicants are recruited 
by competitive examination as positions become vacant. This policy places 
a premium upon professional or vocational experience. A good deal of 

20 Sec White, Introduction (cit. in note 9), pp. 356-360; Sims, Lewis B., "The Social 
Science Analyst Examinations," American Political Science Review, 1939, Vol. 33, pp. 441-450. 

27 Cf. Meriam, Lewis, Public Service and Special Training. Chicago: University of Chicago 
Press, 1936; Upson, Lent D., Ptactice of Municipal Administration, New York: Century, 1926; 
Walker, Harvey, Public Administration in the United States, pt. Ill, New York: Farrar & Rine- 
hart, 1937. 

28 See Eaton, Dorman B., Civil Service in Great ^Britain, New York: National Civil 
Service Reform League, 1881; White, Leonard D. and Others, Civil Service Abroad, New 
York: McGraw-Hill, 1935; Stout, Hiram M., Public Service in Great Britain, New York: 
Harcourt Brace, 1938; Kingslcy, Donald, Representative Bureaucracy. Yellow Springs: Antioch 
Press, 1944. 



40 THE STUDY OF PUBLIC ADMINISTRATION 

criticism has been leveled against it on the ground that in the absence of 
clear career lines able young men and women of general competence, lack- 
ing specific experience, are likely to look elsewhere for their life work. 

The decade from 1934 to 1944 was notable for the efforts made to im- 
prove the quality of intake in the lower grades of the public service. In 
1934, largely at the instigation of Commissioner Leonard D. White, the 
United States Civil Service Commission conducted an examination for 
junior civil service examiner, for which post academic training constituted 
the principal requirement. In 1936, a broader category of social science 
analysts was established as a register from which appointments might be 
made by departments seeking general ability rather than specific experience. 
From January, 1935, through March, 1939, more than 5,000 such junior 
professional appointments were made by federal agencies. L>t) In 1934, the 
National Institute of Public Affairs was established in Washington; an- 
nually it offered about fifty men and women just out of college the oppor- 
tunity to study at first hand the operations of federal agencies in the capacity 
of learners, or interns. Programs of municipal internship also received 
impetus and encouragement at such institutions as Syracuse University, 
Wayne University, and the University of Cincinnati. Apprenticeship pro- 
grams were experimentally developed by several of the national organiza- 
tions of public officials associated with the Public Administration Clearing 
House at Chicago, the Michigan Municipal League, and Los Angeles 
County. 

Post-Entry Training. Most of the present activity and support of pre- 
entry preparation for public service is aimed at the college population. 
Post-entry or in-service training remains the main opportunity of advance- 
ment for the lower-paid ranks in public employment, particularly in the 
clerical and manual occupations. Universities, where located in proximity 
to large groups of government workers, such as Southern California, have 
established courses for public employees, particularly in the fields of budget- 
ing and accounting, police and fire administration, tax assessment and 
sanitary inspection. A source of financial aid is available to states and 
municipalities under the George-Deen Act of 1936 for vocational training 
in public-service occupations. 30 

In the national capital the outstanding program of in-service training 
is that of the Department of Agriculture's Graduate School, whose cur- 
riculum and faculty provide some of the best technical courses in public 
administration in the country. American University and George Washing- 
ton University, also at the seat of the federal government, offer evening 



^Report of President's Committee on Civil Service Improvement, 77th Cong., 1st Sess., 
House Doc. No. 118, p. 25, Washington, 1941. Less than half (2,421) of these appointments 
were made from other lists built up from the usual kind of competitive examination. 

30 See United States Office of Education, Digest of Annual Reports of State Boards for 
Vocational Education, pp. 61-62, Washington, 1942-1943. 



THE STUDY OF PUBLIC ADMINISTRATION 41 

courses in practically all the social sciences. With the several law schools, 
they have trained many men and women who started as clerks and mes- 
sengers for higher administrative and professional positions. In the federal 
service, post-entry training is not highly formalized. 31 It consists, for the 
most part, in encouraging enterprising individuals to seek additional educa- 
tion outside their jobs rather than establishing in-service programs directly 
related to the official machinery for promotion. 

Group Structure of the Public Service. Perhaps the main reason why 
post-entry training has not been more closely coordinated with official chan- 
nels of advancement lies in the American distaste for formal division of the 
public service into relatively closed classes around which real career incen- 
tives might develop. The Commission of Inquiry on Public Service Per- 
sonnel proposed separate careers for administrative, professional, clerical, 
skilled-trade, and unskilled employees. These proposals have never received 
the serious public attention they deserve. 32 In spite of careful explanations 
that an administrative class would serve as a vertical ladder leading from 
junior staff positions or below to administrative assistants and on to the 
top, the impression continues to prevail that such an arrangement would 
reserve the top positions under the political secretaries and assistant secre- 
taries for a special group who would be favored at the expense of able per- 
sons in the clerical, technical, or professional services. 

Regardless of the merits of this objection, it is clear that a systematic 
solution could be worked out if law and personnel policy permitted training 
for admin : strative work as distinguishable from professional, technical, or 
scientific duties. Until such differentiation is adopted in American per- 
sonnel practice, however, top administrative positions will be filled both 
by appointment from outside the service and by promotion from the ranks 
of professional and technical employees. Under these conditions, pre-entry 
programs of training for public administration will have to rely more upon 
general motives of public service and increasing job opportunities in gov- 
ernment than upon the specific attractions of a career in management. 

Higher Career Opportunities. Even without legislative sanction of an 
administrative class, much could be done by a central personnel agency to 
maintain such an ideal as a long-range objective. Constructive suggestions 
looking forward to the establishment of an "administrative corps" were 
made by the Reed Committee on Civil Service Improvement in 1941. 33 
These included: identification of positions in specified grades as a group; 

3 1 For a recent development, sec Reining, Henry, Jr., "The First Federal In-Service Intern- 
ship Program," Personnel Administration, 1944, Vol. 7, p. 8 ff. 

32 Better Government Personnel, pp. 5-6, 37-47, New York: McGraw-Hill, 1935. 
3377th Cong., 1st Scss., House Doc. No. 118, p. 3, 56-62, 86-97, Washington, 1941. 

Sec also White, Leonard D., Government Career Service, Chicago: University of Chicago Press, 
1935. The Council of Personnel Administration and the Advisorv Committee to the Civil Service 
Commission on Administrative Personnel have attempted to follow through on the Reed Com- 
mittee's proposals on a higher administrative service. 



42 THE STUDY OF PUBLIC ADMINISTRATION 

maintenance of an inventory of personnel in these positions for use in making 
appointments to higher administrative posts; reporting of vacancies in 
higher positions; recommending candidates with tested qualifications to 
appointing officers; and follow-up on action. -It was asserted that tapping 
and training personnel for positions in the lowest grade of the administra- 
tive group should be a continuing objective of agency personnel officers 
at all times, while a liberal policy permitting transfer of such personnel 
between agencies would widen their experience and develop general 
administrative skill. The major obstacle to adoption of these suggestions is 
the difficulty of finding enough departmental personnel officers willing and 
able to cooperate on an informal basis, particularly in the face of strong 
pressure upon each to place his own agency's needs above the requirements 
of the service as a whole. 

One way of raising the question of whether the federal service needs 
an administrative corps would be to ask if such a pool of talent could have 
produced adequate competence to plan and direct the civilian side of opera- 
tions during World War II. War experience is not wholly conclusive be- 
cause of the vast expansion of government. Yet it is worth noting that, with 
but rather few exceptions, the higher administrators in the war agencies 
came from the other branches of government or from the outside. In 
civilian recruitment, the Civil Service Commission at an early stage sus- 
pended its usual procedures. It authorized the war agencies to appoint per- 
sonnel subject only to investigation and certification as to general qualifica- 
tions. Moreover, in their procurement and supply operations, the War 
and Navy Departments commissioned thousands of civilians to perform 
administrative tasks. We reached everywhere for administrative talent. 

In establishing its wartime organization the federal government implicitly 
admitted that peacetime agencies and their personnel could not primarily be 
relied upon to plan and direct the civilian phase of warfare. While a fully 
developed administrative service would not by itself have made unnecessary 
the creation of emergency agencies, it might well have prevented or sub- 
stantially minimized the administrative crises and continuous improvisation 
that characterized the first two years after Pearl Harbor. The essential 
lesson of American wartime personnel experience was that we were short of 
men and women who possessed the ability to envisage the problems ahead 
and formulate decisions in advance of crisis situations. 

Perhaps the most compelling peacetime consideration in favor of a higher 
administrative career is the continuous loss to government of able younger 
employees who, having developed their talent within the public service, leave 
for more responsible and more challenging work in private enterprise. 

4. THE FRONTIERS OF RESEARCH 

Function Versus Structure. The accumulation of research materials and 
the maturation of administrative research during the thirties produced 



THE STUDY OF PUBLIC ADMINISTRATION 43 

both a textbook systematization of knowledge and considerable philosophic 
inquiry into the nature, purpose, and scope of public administration. The 
textbooks revealed preoccupation with such matters as the symmetry of 
administrative structure and the procedures of good administrative house- 
keeping. They also raised the question of whether public administration 
consisted of nothing more than an exposition of abstract principles of organi- 
zation and a body of experience aimed at training budget and personnel 
officers. Was this the whole meaning of public service, and the basis for 
attracting ability into government employment? 

The experience of management research in private industry ha'd revealed 
the error of stating principles of organization as ends, or even as major 
purposes. Industrial management now starts from an assumption about the 
basic purpose of the organization as a whole. It encourages research to 
develop the best ways and means of achieving that purpose. Paralleling this 
approach, government research turned to the public purpose sought to be 
achieved. In it was seen the rationale for organization, the planning of 
operations, the creation of staff units to facilitate operations, and the estab- 
lishment of goals and standards as well as methods of measuring results 
in relation to the standards selected. 

This analysis of management shifts the emphasis from structure to 
function. It also defines the key problem as the establishment of effective 
working relations between the component parts of the organization." 34 The 
emphasis upon planning and coordination as essential elements of manage- 
ment helped to reorient the thinking of public administration toward the 
functions of top direction. Thus the budgeting and personnel functions pre- 
sented themselves as techniques of work planning and coordination, and 
as training areas for potential managerial talent, rather than as central 
concerns of the public administrator. 

Man in Organization. Discussion of the elements of organization, how- 
ever realistic, aims at some invariant ideas on basic points for thinking, 
and hence tends to depersonalize the problems of management. Arthur W, 
Macmahon and John D. Millett developed a more productive approach 
through an analysis of the role of personalities in the major departments in 
the federal government. 3 ' 1 Their idea was that a description of background, 
training, and career experience of administrators at the levels of bureau chief 
and assistant secretary should adduce useful evidence of managerial traits. 
The result was an extremely valuable interpretation of varying types of 
administrative supervision and departmental coordination arising from the 
diversity of personal development and the adjustments made by key officers. 

34 Cf. Person, H. S., cd., Scientific Management in American Industry, New York: 
Harper, 1929; Mooncy, James D. and Rcilcy, Alan C, Onward Industry, New York: Harper, 
1931, and The Principles of Organization, New York: Harper, 1939; Dennison, Henry, 
Organisation Engineering, New York: Dutton, 1931. 

35 Macmahon, A. W. and Millett, J. D. Federal Administrators, New York: Columbia 
University Press, 1939. 



44 THE STUDY OF PUBLIC ADMINISTRATION 

The new approach illustrated the impact of personality upon organization. 
It extracted the common elements of managerial experience gained in 
attempting to create departmental unity out of separate bureau operations. 

Biographical research was also utilized by Gaus and Wolcott in their 
monumental study of the United States Department of Agriculture. 36 
Instead of drawing wider inferences from personal data, however, Gaus 
and Wolcott used such material as one among several colors with which they 
painted the panorama of administrative evolution through seventy years of 
political response to powerful economic and technological pressures. Their 
study opened broad vistas of research opportunities in administrative history, 
focused on the positive role of a public agency in bringing professional and 
scientific tools to bear upon the economic problems of a large segment of 
the population. It offered chapter-and-verse illustrations of the way a public 
agency formulates broader programs and policy, leading onward toward 
constructive public service through the educational character of its own 
experience. The authors did not close their eyes to the barriers interposed 
by strong influences in favor of retaining the earlier concepts of protective, 
group-centered regulation. The literature contains no finer treatment of 
public administration as the crucible of collective experience for clarifying 
legislative goals and for developing the techniques of translating objectives 
into administrative instruments for constructive action. 

Theory of Relationships. The lifting of the sights of administrative 
research to focus upon the social and economic environment has been 
largely due to the penetrating writings of Mary Parker Follett and the more 
systematic work at the Harvard Business School under the leadership of 
Elton D. Mayo. Miss Follett's earlier work in political and social theory had 
led her to a keen appreciation of the influence of organization in modern 
society. At the same time she had reacted strongly against the ideologies 
of group and class conflict which constituted both factual explanation and 
political hope for many intellectuals who were aware of antisocial policies 
and controls over modern large-scale production. During the last fifteen 
years before her death in 1933 she became interested in business management 
and organization as a field for application of the principles of unity and 
organized cooperation that she had developed in her political studies. 

In this new field of interest she was impressed much more with the 
conditions tending toward cooperation in the behavior of men working in 
groups than with assumptions about inevitable conflicts of interest. In a 
series of provocative papers and lectures she showed how management, by 
acting on the premise of unity in organized effort instead of merely paying 
lip service to it, could gain tremendous strength in mobilizing individual 

36 Gaus, John M. and Wolcott, Leon O M Public Administration and the United States 
Department of Agriculture, Chicago: Public Administration Service, 1940. 



THE STUDY OF PUBLIC ADMINISTRATION 45 

energies for a common purpose. 87 Pervading all her thinking was the idea 
that individuals at each level of authority in an organization can be condi- 
tioned to think in terms of unity. However, management would have to 
make the effort to enable them to sense and understand their contribution to 
the common enterprise. It was Mary Follett's abiding faith that the factors 
tending toward disunity and internal conflict can be faced frankly; that to 
this end enlightened management will open up channels for collective 
consideration of the conditions in which frictions arise; and that such fric- 
tions stem for the most part from the frustrations and disappointments of in- 
dividuals working under conditions out of which they derive no sense of 
personal creativeness or contribution. 

The research of the Harvard Business School into the springs of human 
motivation in business organizations has given us the benefit of a scientific 
documentation of Miss Follett's insights. 38 These studies applied to indus- 
trial research both anthropological findings and sociological concepts, and 
added much sophistication as to the meaning of scientific methods of inves- 
tigating social relations. The record of the Harvard team's association with 
the Western Electric experiments in personnel relations constitutes perhaps 
the high-water mark of intensive research into group behavior under con- 
trolled conditions. It is impossible to summarize this work adequately, but a 
few outstanding findings may be mentioned: 

First, there is in each organization a system of informal personal rela- 
tionships which condition work habits and attitudes more effectively 
than the official hierarchy of authority. The student must develop tech- 
niques of observation and interview to enable him to grasp the essential 
quality of the organization under attention. A measure of his own 
effectiveness is the degree to which he is accepted within the system and 
is able to enlist the collaboration of those whose organizational behavior 
he is studying. 

Second, large organizations consist of many working groups, each 
small enough to effect cohesion. Morale centers around such groups, 
where direct personal relationships function in relation to a set of non- 
logical or emotional incentives and standards. These group standards 
must be integrated with the purpose of the organization as a whole 
and not permitted to develop intergroup conflicts. Effective management 
must not only recognize and give status to each rank in its own social 
structure, but also be sure to establish channels of communication be- 
tween each group and the center of direction in the organization. 

Third, the function of attaining a sense of interrelatedness between 
the working groups composing the organization as a whole is a full-time 

37 Her collected papers are reprinted in Metcalf, H. C. and Urwick, L., eds., Dynamic 
Administration, New York: Harper, 1941. 

S8 Cf. Mavo, Elton D., The Human Problems of an Industrial Civilization, New York. 
Macmillan, 1933; Whitehead, T. N., Leadership in a Free Society, Cambridge: Harvard Uni- 
versity Press, 1936; Roethlisbcrger, Fritz, J. and Dickson, W. J., Management and the Worker, 
Cambridge: Harvard University Press, 1943, and Roethlisberger, Management and Morale, 
Cambridge: Harvard University Press, 1941. 



46 THE STUDY OF PUBLIC ADMINISTRATION 

job which top management cannot leave to chance or to the part-time 
attention of supervisory personnel. Explicit attention must be given 
to locating and reporting human dissatisfactions at the working levels, 
maintaining harmony among the groups in the organization, and study- 
ing methods of introducing changes in technical processes or formal 
modifications in the structure itself. 

Progressive Management. The importance of the personnel function 
in organization can hardly be overstressed, but its relation to the central 
task of top management remains to be stated. In response to the Harvard 
group, an outstanding business executive, Chester I. Barnard, developed 
perhaps the most systematic analysis of the executive function since Henri 
Fayol. Barnard defined organization as an "impersonal system of coordi- 
nated human efforts." He identified the executive's job as: (1) providing 
the system of communication; (2) securing essential services from indi- 
viduals; and (3) establishing the purposes and objectives of organiza- 
tion. 39 In his formulation, technical efficiency and morale are not the pri- 
mary ends of organized effort. They are limiting factors bearing upon the 
permanence or duration of an organization, whose existence through time 
depends upon its effectiveness in attaining both the concrete ends of con- 
certed activity and essential human satisfactions. Every one of the elements 
of management depends upon personnel. While the selection of top per- 
sonnel cannot be delegated, the task of functional coordination of those at 
the lower levels must be related to the purposes of the organization rathef 
than to the managerial function. 

All of these propositions show how far modern personnel research has 
gone beyond the concept of management as the application of fixed rules 
of organization and the installation of technical procedures of selection, 
training, and placement. Public administration has been especially receptive 
to these ideas. The growing rapprochement among students of administra- 
tion in public and private enterprise is demonstrated by various develop- 
ments. Two illustrations are the widespread recognition of the work of 
Lyndall Urwick 40 and the collection of writings in both fields for the 
staff of the President's Committee on Administrative Management. 41 The 
emphasis on matters of structure among private management consultants 
reflects their greater confidence in the validity of organizational theory. 
Government administrators and their planning staffs are more acutely 
conscious of the impact of political influences upon public organizations and 
have come to accept these pressures as a normal aspect of their work. 

The most noteworthy American experiment in modern managerial free- 
dom to accomplish broad objectives of public policy the Tennessee Valley 
Authority has been analyzed in a brilliant piece of administrative reporting 

39 Barnard, Chester I., The Functions of the Executive, csp. chs. 7 and 15, Cambridge: 
Harvard University Press, 1938. 

40 Urwick, L., The Elements of Administration, New York: Harper, 1943. 

41 Gulick and Urwick, op. cit. in note 1 . 



THE STUDY OF PUBLIC ADMINISTRATION 47 

by its chairman, David E. Lilicnthal. 42 The author, convinced that democ- 
racy can plan and determine the course of its political evolution, demon- 
strates the results that public management can achieve in the utilization 
and development of natural resources. Lilienthal feels deeply that TVA 
exemplifies sound democratic administration decentralized operations, 
voluntary citizen cooperation and local community participation with gov- 
ernment officials in achieving the purpose of the organization, fixing of 
responsibility for both planning and execution of administrative policy upon 
a single agency, a personnel policy based strictly upon merit but allowing 
for constructive flexibility, and an enforcement policy of education and 
persuasion that relies for coercive sanction only upon the power of eminent 
domain in the public interest. 

The essence of democratic administration, Lilienthal says, is doing things 
with people, not to them, and placing the responsible administrators close 
to the people where they must share the people's problems. Method, he 
asserts, is all-important; "it is as inseparable from purpose and ends as our 
flesh is from our blood." Give to management powers of affirming and 
initiating what shall be done; fix upon it responsibility for results; see that 
the experts take action with people instead of simply applying legal coercion 
if we do so, we may be sure that management will work as well for the 
public interest as for any incentive of private profit. The TVA demonstra- 
tion is a revelation of the enormous potential of moral power available to 
a democratic people if they possess the courage to exploit their natural 
resources for the common benefit; if they exercise the self-restraint to fix 
upon the administration the responsibility and freedom to decide how this 
should best be done; and if they find institutional ways of holding the 
managers to account for final results. 

Horizons of Administrative Research. Research in public administra- 
tion thus has pushed steadily backward the barriers of technical separatism 
and lack of communication between the various specialists in the adminis- 
trative arts. Scientific methods have been applied to the study of the human 
factor in organization. The inner secrets of the priesthood of management 
have been proved to be susceptible of analysis. Great strides have been made 
in clarifying the relationship of budgetary and personnel Coordination to 
general management. 

Above all, research in public management has struggled free from the 
notions of public business as routine, as primarily negative and restrictive 
upon personal or private initiative, and as an unnatural but necessary evil. 
Study of the modes of policy formation and the relationships in organiza- 
tion has brought about an understanding of the psychological processes 
of personal identification with the individuality and achievements of the 
organization as a whole. Thus public administration has advanced to a 

*~TVA: Democracy on the March, esp. pp. 159-161, 199-202, New York: Harper, 



48 THE STUDY OF PUBLIC ADMINISTRATION 

realization of the strong sense of individual release and satisfaction in 
cooperating with others. 

Because of the great desirability of arriving at common agreement on 
public needs and public objectives, increasing research in the borderline 
problems lying between political theory and public administration seems 
inevitable. 4 ' 1 Can greater consensus be reached upon the creative and forma- 
tive roles of administrators in advising on the best means of defining particu- 
lar objectives and establishing the administrative machinery for achieving 
them? How should administrative agencies attempt to integrate their activi- 
ties with private group demands and drives for power? How can political 
leadership be brought to utilize properly the concepts and techniques of 
administrative planning in the formulation of public policies and programs? 
Can new forms of administrative accountability to legislatures and to the 
public be devised which will increase mutual respect and lessen suspicion 
and distrust? Can the educational system be used with greater effective- 
ness to arouse both a sympathetic appreciation of the problems of public 
management and a desire to enter the public service in the minds of promis- 
ing individuals representing all sections of the population? 

These are problems of the highest order. They demand unflagging inter- 
est and research. For satisfactory progress, we need to establish much better 
contacts with foreign administrative experience. Comparative study, of 
which thus far we have had too little, is of obvious value. 

5. ADMINISTRATION ART OR SCIENCE? 

Aims of Scientific Approach. The term "science" is an honorific word. 
Considerable effort has been made to justify its use in identifying the 
knowledge and skills that are applied in administrative practice. A science 
of administration in the sense of a body of formal statements describing 
invariant relationships between measurable objects, units, or elements does 
not seem very useful to most students and practitioners. Unquestionably, 
administrative research has produced a sizable body of definite precepts and 
hypotheses that are applicable to concrete situations. 44 But what adminis- 
trators visualize as particularly valuable goes beyond that. They are inter- 
ested in the techniques of systematizing the process of securing and sifting 
relevant information so that the factors involved in arriving at a policy 
decision can be stated and the consequences of alternatives can be analyzed 
and balanced. 

The objective of public or private management is to create conditions 
under which a determination of appropriate action can be made in terms 
of a plan and an understanding of how that particular decision will fit into 

43 See Merriam, Charles E., "Public Administration and Political Theory," Journal o) 
Social Philosophy, 1940, Vol. 5. p. 293 #.; Political Power, pp. 285-296, New York: McGraw- 
Hill, 1934. 

44 C/. Beard, op. cit. in note 16, pp. 163-J70; Urwick, op. cit. in note 40, pp. 17-19. 



THE STUDY OF PUBLIC ADMINISTRATION 49 

the plan. From this angle, administrative research does not seek its goal in 
the formulation of mechanical rules or equations, into which human be- 
havior must be molded. Rather, it looks toward the systematic ordering of 
functions and human relationships so that organizational decisions can and 
will be based upon the certainty that each step taken will actually serve the 
purpose of the organization as a whole. 

Concerns of the Technicians. Naturally, there are levels of routine and 
technical proficiency on which greater degrees of uniform mechanical opera- 
tion are possible and desirable than at others. Research should continually 
seek to simplify and standardize work methods, ranging from the relatively 
simple operation of sorting incoming mail for distribution to the complex 
process of formulating a work plan for an entire organization in the annual 
budget. However,, the establishment of standardized processes and mechani- 
cal efficiency docs not penetrate to the central function of management. 
Absorption into this more limited aspect of the science of administration 
differentiates the operational expert and technician from the manager- 
administrator. 

Techniques of budgeting, accounting, personnel management, purchase, 
storage and handling of materials, and reporting operations are indispensable 
tools whereby the facts involved in recurring problem-situations are brought 
into focus for the administrator. Yet they are significant to him only as 
they raise issues requiring his determination, or call for changes in the 
policy of the organization. Administrative progress, in this sense, consists 
in the reduction of problems to routines which can be disposed of satis- 
factorily at the lower levels. 

Science and Social Dynamics. Focusing upon the problem areas of social 
organization, the question becomes a different one. How far is it a matter of 
science to exercise judgment in selection among alternatives of policy, in 
the determination of specific action in pursuit of the purpose of the organi- 
zation, or in the interpretation of the requirements of the public interest 
in particular cases? If this question were to be answered in scientific terms, 
the answer would have to be stated, as in all matters of social relations, in 
categories upon which general agreement could be obtained. We have 
not yet reached complete agreement on the purpores and powers of public 
officials, or on a formula for human behavior whereby conflicts of interest 
and will can be predicted and determined in advance. In the philosophy and 
practice of democracy, however, it has been learned that men can agree 
upon constitutional procedures through wh'ch personal and intergroup 
conflicts can be resolved in terms of general policy, basic objectives, and 
social priorities. 

Evaluated Experimentation. Through the joint action of public officials, 
public policy can be tested, tried out, and changed as the result of administra- 
tive experience and alert leadership. The science of administration in a de- 
mocracy will never be simply a matter of definition; it will always be a mat- 



50 THE STUDY OF PUBLIC ADMINISTRATION 

ter of living and striving. Its content will be reflected in the methods by 
which administrative experience is applied to the formulation of changing 
ideas of public goals. It will gain more specific meaning in continuous re- 
search into the problems of communication, incentive, and morale within 
both public and private organizations. It will grow through the insight and 
ability of administrators as they devise ways of adjusting their programs to 
the conflicting demands and ideals of their consumer publics and their 
political overseers. 

Alliance of Theory and Practice. This view of a democratic science of 
administration assumes a unity of theory and practice, and at the same time 
envisages a general but not closed functional differentiation between its 
students and its practitioners. That is to say, administrative research must be 
oriented toward actual behavior and the working problems of administrators; 
continuous efforts must be made to encourage such research and to bring its 
results to the attention of busy administrators.* The suggestion of a National 
Research Library for this purpose has been made on several occasions by 
Professor Charles A. Beard. Furthermore, administrative research must not 
be turned into the handmaiden of officialdom to justify the preferences of 
policy-makers at any given moment. 

The profession of administration should include both the research worker 
and the executive. They should collaborate in selecting problems for study 
and making data and experience available. In the formulation and interpre- 
tation of findings, however, there will always be room for initiative and 
responsibility outside the official sphere. It is to be hoped that students of 
administration in universities, business organizations, privately supported 
research institutions and public agencies will all seek to break down the 
invisible barriers of distance, suspicion, and difference in technique and 
objective. Through professional association and the written and printed 
word, it should be possible to broaden the channels of communication and 
understanding between public and private organizations for mutually helpful 
analysis of administrative problems. 



CHAPTER 

3 

Bureaucracy Fact and Fiction 

1. SEMANTICS AND REALITIES 

The tyranny of words is nowhere better exhibited than in the use of the 
word "bureaucracy." Governments do their work as much through admin- 
istration as through politics. It might therefore be supposed that in a dem- 
ocracy where administrators are subject to direction by politicians and where 
politicians derive their power from the people, popular allusions to those 
who manage the public business would have pleasing connotations. Perhaps 
that is the way it ought to be. For the present, however, the opposite is 
true, and will be for some time to come. 

The Language of Contempt. One of the most common collective desig- 
nations for those who man the services of government is "bureaucracy." 
The name is one of derision and contempt, harsher, to be sure, in some 
contexts than in others but even at its mildest a word inviting one to sneer 
or scorn. 1 The prevalence of this designation may be regrettable; yet it is a 
fact, and as such something not simply to be decried but to be acknowledged 
and understood. There are several different explanations for it. Each 
warrants brief examination. 

As is evident in a thousand ways, the human animal is fearfully and 
wonderfully made. Man knows he needs the discipline of authority. Wher- 
ever he has come far enough in his evolution to enter the political stage of 
development, he has taken steps to establish such authority. But even as he 
maintains it, he still resents it and chafes under it. Rationally he realizes 
that freedom is unworkable without responsibility. Emotionally his desire 
is for liberty without restraint. In this sense "cussin' the bureaucrats" con- 
stitutes one expression of human nature, destined to continue as long as 
man remains on the earth. 

Habit and memory furnish another explanation. In America, popular 



1 This discussion draws on Morstcin Marx, Fritz, "Bureaucracy," in Peel, Roy V. and 
Roucek, Joseph S., cds., Introduction to Politics, p. 410 //., New York: Crowcll, 1941. Cf. also 
Finer, Herman, "Critics of 'Bureaucracy'," Political Science Quarterly, 1945, Vol. 60, p. 100 ff. 

51 



52 BUREAUCRACY FACT AND FICTION 

government, as most people think of it today, was born hardly a hundred 
years ago. Only in Britain has it existed for anything like as long a period. 
Elsewhere in what are now free countries with the notable exception of 
Switzerland, the Scandinavian nations, the Low Countries and the British 
Dominions monarchy and aristocracy continued to rule not only in form 
but in fact until the late nineteenth and in some cases the early twentieth 
century. Both in America, therefore, and in those lands across the sea 
whence so many of our forbears came, government of the people, by the 
people, and for the people triumphed only after centuries of autocratic or 
aristocratic rule during which administration was frequently overbearing 
if not inconsiderate and cruel. Consequently, it was in some measure out 
of their own mean experience that the common people came to damn their 
public "servants." The evil being long-continuing and the people remem- 
bering it full well both as groups and as individuals, the habit has persisted. 

Officiousness and Frailty. Officiousness is a third factor accounting for 
the unflattering character of many of the popular references to the adminis- 
trative profession. Civil servants are ordinary mortals; they have the defects 
and weaknesses typical of human nature. Each man loves, as Shakespeare 
said, "his own brief moment of authority." However, some seem unable to 
avoid showing their glee, and of these the public service probably has a 
normal ratio. It is so in all countries} Every government has a proportion 
of otherwise satisfactory employees who do their work in a fashion that 
rubs the public the wrong way. (This "insolence of office" naturally comes 
in for greater criticism in democratic lands like America, Britain, France 
and the Scandinavian countries.) Yet even the Germans found ways of 
scoffing at Brownshirt "bureaucrats" while Hitler was in power. Nor have 
the people of the Soviet Union hesitated to lampoon their own overreaching 
"functionaries." The combat troops of all armies illustrate in their scorn 
for martinets and for big-talking paper-soldiers berthed at headquarters 
the military equivalent of these civilian attitudes. 

'Further probing leads to a more serious fact. Occasionally bureaucrats 
do abuse their position and authority. By and large, the governmental 
processes of modern democracy constitute adequate protection against official 
jpiscoaduct. However, these procedures are not always fully used nor are 
they always faithfully observed. Here and there a public servant attempts 
to make his public office yield a private gain or buckles under pressure and 
uses his power to confer illicit advantage on some special group. Il should 
be added that this happens more often among bureaucrats in elective than 
in appointive posts. Although the guilty are not always caught and forced 
to make amends, the gross volume of such abuse has long been on the 
decline. 

Administrative Self -Promotion. More common and harder to cope with 
is a wholly different kind of fault which often arises from excess of zeal in 
the promotion of what is honestly believed to be the public interest. That 



BUREAUCRACY FACT AND FICTION 53 

is the inclination of some public administrators to take too expansive a view 
of their functions. In_ order tojacrnmplLsh a public good that might other- 
wise be deferred nr Insr^ they ypay push the range of their discretion beyond 
the limits Amended by thg legislature. It was a mistake, Woodrow Wilson 
argued, to relegate administration to the category of things "which clerks 
could arrange after doctors had agreed upon principles." But it is equally a 
mistake and in a democracy a dangerous one to conceive of administra- 
tion ao the heroic center of government. Such a conception might encourage 
the view that an independent executive, beyond carrying out the policies 
formulated by the legislature, is free to compensate, ^through administrative 
orders, for legislative errors of omission or commission! 

Administration has been called the core_of modern- government. This 
is true in the sense that it is today essential in all states, popular and despotic 
alike, Even in a democracy, it is the branch through which government acts 
as an evercontinuing process, and- in which the overwhelming majority 
of public employees work and the vast bulk of public funds 15 jjpent. Yet 
policy-making through. representative assemblies remains primary. To allow 
administrators to make the policies they arc to execute, as was the case in 
Hitler's Germany and Mussolini's Italy, is the definition of despotism. To 
organize government so that controlling authority is always vested in those 
whom the people desire to exercise political power, as is the case in demo- 
cratic Britain, under a cabinet backed by a majority in the House of Com- 
mons this, many believe, is one of the best formulas for freedom yet 
devised. 

Where, as in the United States, the executive branch with its mix- 
ture of political influence and administrative authority is largely independent 
of the legislature, and where men without political status may suddenly be 
appointed to important administrative posts, ^ special obligations rest on 
administrators as on legislators to maintain a sense of proportion about 
their functions. Public executive^ are obliged to engage in the formulation of 
adminhtratiy.^poUcy, and the necessity for this should be. freefy-jconceded. 
Except as the chief executive may direct, however, their participation in the 
making of political policy should be confined to advising him and the legis- 
lature on policy matters in their own field of operation and offering recom- 
mendations or technical assistance to be used for legislative action. Here 
the administrator may argue with foresight, with ingenuity, and with a 
sense of urgency. Having presented his views, however, he has done every 
thing he may properly do. 

Thus th|gi^at^afl^-^--p^^V--has its 



It is up to the administrator to abide by them no less than the politiciar 
and the citizen. No bureaucrat has been prevented from resigning his office 
and agitating as a citizen for the policies he thinks indispensable to th< 
common welfare. Nor, indeed, is there any law to keep him from running 
for Congress or the state assembly or the city council and, as a politician 



54 BUREAUCRACY FACT AND FICTION 

advocating what the legislature should do. That is the democratic way to 
secure the enactment of a particular public policy by winning a triumph 
for it in the political arena. That is the reason why the public takes offense 
at men who, as administrators, would try to "decree" policies they had been 
unable to "put across" as politicians. 

v Procedural Rigmarole. Red tape or what the average citizen has in 
mind when he uses that phrase also supplies part of the explanation for the 
stereotyped conception of bureaucracy. The point should be granted without 
argument. To thr ninety per cent of the public who want to do "the right 
hing" and generally know how to do it, many government procedures 
nust seem unnecessarily complicated. This is true especially of those to 
whom it fails to occur that most of the detailed requirements relating to such 
matters as permits, licenses, and contracts are to save the majority from the 
ignorance, selfishness, or carelessness of the other ten per cent. Hard and 
costly social experience accounts in the main for specificities of bureaucratic 
procedure. 

When at the threshold of World War II motormaker William Knudsen 
assumed a post of great importance in the defense effort of the nation, he 
said of Washington red tape, "In Detroit we call it system." Thus he not 
only gave it a fair and simple characterization but he also furnished a clue 
to the reason why it is productive of irritation. After all, it is tape, it is 
system. Being inanimate, it is incapable of perfect and instantaneous adapta- 
tion to every individual's personal interest or situation let alone his whims 
and fancies. Resenting authority to begin with, man resents it even more 
when, no matter what the reason, it seems to blind itself to the scene of its 
^operation. Yet in countless instances this appearance can hardly be avoided. 
There are numerous types of situations in which the power to fix general 
rules must necessarily be centered, while information relevant to their just 
and proper utilization lies largely at the point of application. Delegation 
of discretion may not always be a feasible answer. When public administra- 
tion has to rely on absentee authority, it must accept the consequences in 
popular resentment and dissatisfaction as a "risk of operation" just as, in 
similar circumstances, they are accepted in private business. 

The assembly lines in the great automobile plants are designed to move 
at the speed and in the order that will enable the workers to produce the 
maximum number of cars per day. This does not mean that a customer will 
always be able to get the car he wants when he wants it and at the price 
he thinks right or that individual workers will not find the pace incon- 
veniently fast or slow. So with the red tape of a government agency. 
Though designed to enable its employees, working at an established rate, to 
provide the public with service conforming to acceptable standards, it will 
fail to meet precisely the needs of every single citizen. Methods and proce- 



BUREAUCRACY FACT AND FICTION 55 

dures calculated to yield the greatest good for the greatest number patently 
cannot fit the details of each and every case. 2 

Subjectivity and Objectivity. "Bureaucracy" would not signify to the 
common people the evils it does in America today were it not that various 
interests, unwilling to accept public control, have been resolved to discredit 
if possible, the very idea and institution of governmental administration. 
The economic stakes involved in such efforts are great, and the financial 
resources available to support them are frequently on the same scale. Much 
of the mspiraTipn fo^ the battle against "bureaucratic regimentation" is 
generated by nothing nobler than the desire tojuake jt clifHcult O r impossible 
for democracy jx)jyiact or enforce^ regulations needed Jo protect the public 
interest. Bureaucracy is besmirched because this seems to offer an effective 
way of winning the battle. 

Through distortion and caricature, the term "bureaucracy" has come to 
imply bungling, arbitrariness, wastefulness, officiousness, and regimentation. 
What is its technical meaning? In free translation, it means simply "desk 
government" management by bureaus. It denotes tKe sum Jotal^of the 
personnel^ apparatus^ang~prbceHuFes by which anjpjganizat^n_manages its 
work and achieves its purposes. The orgamzatipnjnay_bejgublic^r private, 
governmental, commercial, educational, ecclesiastical but if it is of any 
size it must be a bureaucracy. 

In this sense, bureaucracy is a feature of all large-scale undertakings, 
being simply the means, human and physical, through which they strive to 
attain their objectives. From this standpoint, the General Motors Corporation 
is no less bureaucratic than the United States Government and General 
Motors employees are quite as well aware of the fact as are federal workers. 
There is, however, a more restricted meaning of the term. Without implica- 
tion of invidious distinctions, it is confined in some contexts solely to gov- 
ernment. When so used it normally refers to the entire executive establish- 
ment, especially the permanent or career personnel and their operating facili- 
ties and procedures. On its administrative side, then, the whole problem 
of government consists as Carl J. Friedrich has properly emphasized in 
the development and maintenance of a bureaucracy that is competent, re- 
sponsive, and responsible. 3 

2. THE SOURCES OF RED TAPE 

Efficiency in administration depends at bottom upon devising and direct- 
ing a routine, a regimen, a system. We may grant that it is never possible 



2 For a provocative study through a management-engineering approach to the problem of 
red tape, see Juran, J. M., Bureaucracy A Challenge to Better Management, New York: Harper, 
1944. 

8 See his Constitutional Government and Democracy, Boston: Little, Brown & Co., 1941; 
also Friedrich, C. J. and Cole, Taylor, Responsible Bureaucracy: A Study of the Swiss CM 
Service, Cambridge: Harvard University Press, 1932. 



56 BUREAUCRACY FACT AND FICTION 

to reduce all components of a process to the point where they can be so 
handled. It is nevertheless the aimJn all managenrient tojliscoyer and intro- 
duce that division of spccializcdJ.abQr_.which will enable the total job to be 
performed motliti^ctprily and at the lowest possible cost. 

Red Tape and Green Tape. From the standpoint of efficiency, public 
.ind private administration are basically alike. They operate under similar 
types of managerial motivation and compulsion. Many of the sources of 
red tape in governmental bureaucracy are no different from those which 
account for the^ "green tape" if we may call it that in business bureauc- 
racy. 4 But the: paralleljjojds true for only part ofjhcjvay. Administrators 
in government arc obliged jo^c_j^gardfuL of_some considerations beyond 
those to" which business^an_lim]tjt:s_. concern. These make the government 
tape jcdJjHstf M\ .oL^grecn, . Typically they are social Aristotle would have 
called them political considerations as distinguished from economic, and 
they certainly should figure in public administration. 

Perhaps in some fields the ultimate objectives of public management 
are identical with those of commercial undertakings, but this is the excep- 
tion rather than the rule. Government generallyjiims at ends more complex 
and more iioy^nible_ th^^busi^ess. Men look to government for justice, 
law, peace, and order; for the maintenance cf liberty, equality, and oppor- 
tunity; for impartiality in the enforcement of economic regulations and 
for even-handed ness in the administration of economic assistance not so 
much for service that is swift and cheap as for service that is safe and sure. 
They want such service to be economically efficient. They also want it to 
satisfy these other and more basic expectations. They do not run their gov- 
ernment to make money. They run it in order to establish and preserve 
an environment in which they themselves can make a decent living. The 
ct-nnjnj-^ nf gtirw<;g in fondness js ; tjicj^rcatest^conomic gnjjTjr> the individual 
entrepreneur or firm at the lowect cconomjc art. The standard for govern- 
mejit is Jthe greatest ^nri^^nd^conomic gam for the public jat the lowest 
social-and-economic or t to all. 

Requirements of Efficiency. To avail itself of the economies latent in 
specialization and large-scale organization, government no less than busi- 
ness must subnrt to the compulsion of working out a detailed requence 
of steps in which the various jobs on each unit of production can best be 
done. Assembly-line techniques offer marked advantages over those of 
custom craftsmanship. JHey also have their price. They entail the imposi- 
tion of an order of progression, the fixing of a rate or rhythm of operation, 
and the discipline of a regular routine. Set order, fixed pace, and adherence 
to routine these are the very stuff of which red tape is made. Yet they arc 
of the essence of system, too. 

4 For an amusing and withal an instructive account of what can happen when a customer 
gets entangled in the green tape of private business, see Appleby, Paul H., Big Democracy, pp. 
58-59, New York: Knopf, 1945. 



BUREAUCRACY FACT AND FICTION 57 

Predictability of Performance. Also common to both government and 
business is the desire for predictability of performance. Both for his own 
peace of mind and in the interests of maximum productivity, an adminis- 
trator wants and needs to know how many units of goods or services his 
staff or plant can produce per week or per month and at what cost. Whether 
in government or business, his only hope for such predictability lies in the 
possibility of maintaining sufficient regularity of operations, both qualita- 
tively and quantitatively, to permit the calculation of results in advance of 
their occurrence. Yet the very regularity for which he strives and on which 
he depends for his success may prove detrimentally monotonous to the 
workers under him and may not be appreciated by his customers. 

These two, however, are not the only common sources of red or green 
tape. Both kinds of tape are nourished by institutional inertia and indiffer- 
ence wherever either is allowed to gain a foothold. Both flourish wherever 
the lure of order, once established, invests every precedent with the sanctity 
of final authority. Both positively luxuriate wherever management becomes 
so attached to the comfort of accustomed routine that it avoids at all costs 
even the momentarily disruptive effects of a slight change in procedure. 

Government of Laws. What of the red tape peculiar to public adminis- 
tration? We may first note the administrative counterpart of that key 
principle in democratic politics which insists that freedom means a govern- 
ment J>f_Jaws rather than of men. Public administration wears red tape 
because it is expected to proceed according to objective rules rather than 
the subjective intuition of government officials. Who would have it other- 
wise? Red tape is perhaps the best insurance the public has that all citizens 
will receive equal treatment at the hands of their civil servants. 

Accountability to the PMblfc. Another closely related source of red tape is 
the ins.sTenceToFthe public on full accountability in governmental manage- 
menfTnot "alone Tor final results but also for each and every step by which 
they are attained. This means that bureaucrats arc required lo-daAcir work 
in such ^\vay that, actually_orjxinLngeJitly^ their every move is open to public 
scrutiny._Thcy must perform their task in a fashion that can^b_defended 
and justified even if brought under the most minute and critical review. The 
result is what might be expected almost as much concern at times over 
not doing anything wrong as over trying to do something right. To make 
matters worse, the tangible rewards for creative imagination are likely to 
be meager. Business management prides itself on paying handsomely for 
initiative and invention. In public administration, the premium on con- 
structive innovation is hardly ever of comparable magnitude. Nor is this 
for the reason that governmental management does not appreciate the 
value of such incentives. The trouble lies in its being hedged about by re- 
strictions that practically preclude it from using them. 



58 BUREAUCRACY FACT AND FICTION 

3. THE CHARGE OF DESPOTISM 

Having essayed an explanation and evaluation of the red tape and inef- 
ficiency ascribed to bureaucracy, let us now examine the merits of two 
graver indictments those of despotism and regimentation. Both relate to 
supposed abuses of trust or power by the executive branch of government. 
For the sake of convenience we shall confine ourselves in the present section 
mainly to the charge that bureaucracy seeks to usurp the judicial function, 
and endeavor thereafter to investigate the claim that it is contriving to usurp 
the legislative function as well. 5 

Effects of the Industrial Age. The separation of powers has never meant 
the same thing in Britain as in America, particularly with regard to rela- 
tions between the executive and legislative branches. However, with respect 
to relations between the executive and judicial branches it has had approxi- 
mately the same significance. One of the common assumptions in both 
countries has been that the rights and liberties of the citizen would not be 
secure unless all men, public officials and private persons alike, were under 
the "rule of law" guaranteed by a hierarchy of independent courts of law. 
So long as government could operate on the scale of policing activity, the 
judicial tribunals were able to dispose of nearly all types of questions calling 
for adjudication whether arising out of criminal offenses in the usual 
sense, civil-law transactions, or noncompliance with administrative regula- 
tions. As the impact of technology upon society became more pervasive, 
every government has been obliged steadily to extend the range of its con- 
cerns. For the proper handling of various types of technical controversies, 
this has carried with it the creation outside the judicial branch of novel 
administrative agencies or tribunals staffed with specialized personnel and 
authorized to employ such procedures as might be most effective in the 
light of the subject matter involved. 

Because they were in the vanguard of industrialization, America and 
Britain have had to make changes in administrative structure and procedure 
comparable to those undertaken by other nations which were less deeply 
attached to the ideal of the rule of law. As in the case of most departures 
from old ways, the new administrative tribunals did not always function 
perfectly, particularly in their early years. Occasionally they made errors 
of procedural propriety which but for subsequent review by courts of law 
might have led to miscarriage of justice. From the beginning, however, 
certain groups within the body politic have been unwilling even to acknowl- 
edge the necessity for new instrumentalities of this kind. By insisting that 
the rule of law was being vitiated rather than aided by constructive adjust- 

5 For a fuller treatment, sec below Part IV, "Responsibility and Accountability." 



BUREAUCRACY FACT AND FICTION 59 

ments in the manner of its application, they condemned these instrumentali- 
ties as agencies of a new despotism. 6 

Charge of Usurpation. Lord Hewart, a British jurist, articulated the 
opposition in his volume entitled The New Despotism. His book has had 
so great a vogue on both sides of the Atlantic that it may well be taken 
as the definitive indictment. "A little inquiry," he wrote, "will serve to show 
that there is now, and for some years past has been, a persistent influence 
at work which, whatever the motives or the intentions that support it may 
be thought to be, undoubtedly has the effect of placing a large and increasing 
field of departmental authority and activity beyond the reach of the ordi- 
nary law." 7 Taking for granted the adequacy of "the ordinary law" per- 
haps more accurately, "the ordinary courts" and thus in a way begging the 
whole question, the author averred that the people of Britain were in 
danger of losing their liberties through the growth of administrative 
absolutism. 

Hewart ignored the inconvenient question of the competence of the ordi- 
nary judges to ascertain the facts, let alone their significance, over a wide 
range of technical matters. He simply argued that individual rights and 
liberties were now in jeopardy because the "ardent bureaucrat" had lately 
come to operate under "some such faith" as this: 8 

1. The business of the Executive is to govern. 

2. The only persons fit to govern are experts. 

3. The experts in the art of government are the permanent officials, 
who, exhibiting an ancient and too much neglected virtue, "think them- 
selves worthy of great things, being worthy." 

4. But the expert must deal with things as they are. The "four- 
square man" makes the best of the circumstances in which he finds 
himself. 

5. Two main obstacles hamper the beneficent work of the expert. 
One is the sovereignty of Parliament, and the other is the rule of law. 

6. A kind of fetish-worship, prevalent among an ignorant public, 
prevents the destruction of these obstacles. The expert, therefore, must 
make use of the first in order to frustrate the second. 

7. To this end let him, under Parliamentary forms, clothe himself 
with despotic power, and then, because the forms are Parliamentary, 
defy the Law Courts. 

8. This course will prove tolerably simple if he. can (a) get legisla 
don passed in skeleton form, (b) fill up the gaps with his own rules, 
orders, and regulations, (c) make it difficult or impossible for Parliament 
to check the said rules, orders, and regulations, (d) secure for them the 



6 For a fair sample of the literature in which this view is presented, sec Hewart of Bury, 
The New Despotism, New York: Cosmopolitan Book Corp., 1929 (reissued London: Benn, 
1945); Allen, C. K., Bureaucracy Triumphant, London: Oxford University Press, 1931; Amer- 
ican Bar Association, "Report of the Special Committee on Administrative Law," Reports of the 
American Bar Association, 1936, Vol. 61, pp. 720-794; McGuire, O. R., "Administrative Law 
and American Democracy," American Bar Association Journal, 1939, Vol. 25, p. 393 ff. 

1 Hewart of Bury, op. cit., p. 5. 

id., pp. 13-14 (by permission of the publisher, Farrar & Rinchart, New York). 



60 BUREAUCRACY FACT AND FICTION 

force of statute, (e) make his own decision final, (f) arrange that the 
fact of his decision shall be conclusive proof of its legality, (g) take 
power to modify the provisions of statutes, (h) prevent and avoid any 
sort of appeal to a Court of Law. 

9. If the expert can get rid of the Lord Chancellor, reduce the 
Judges to a branch of the Civil Service, compel them to give opinions 
beforehand on hypothetical rases, and appoint tbem himself through a 
businessman to be called "Minister of Justice," the copingstone will be 
laid and the music will be the fuller. 

If all this, or even the main part of it, were generally true of democracy's 
bureaucrats and their intentions, it would be a devastating indictment. 
America and Britain would assuredly be en the road to despotism. But 
the charge is not true; and for the most part it 13 wholly without warrant. 9 
Had Hewart and our American critics of like mind been content to specify 
some of the cautions which ought to be observed in adapting the rule of 
law to the conditions of a technological civilization, they could have per- 
formed a valuable service. 10 Lacking both such interest and moderation, 
what they have done is to prove too much. 

Legislative Delegation. As Pennock observes in opening his study of 
Administration and the Rule of Law? 1 "Before the days of the automobile 
there was no need for policemen to direct traffic. Before our population 
had multiplied and become concentrated in congested urban areas, sanitary 
inspectors were not so necessary as they are now. Before the development 
of large-scale business enterprise, the sale of securities required no super- 
vision by the government." These changes illustrate some of the technical 
problems with which public administration has been confronted through the 
progress of applied science. It is almost axiomatic that no invention is 
ever quite an unmixed blessing. New mechanisms or processes often 
bring new dangers as well as new utilities. They pose for government the 
question of how best to secure public advantages without at the same time 
disturbing or endangering the social order out of proportion to actual 
gains. 

Ordinarily, as might be expected, the legislative body was the first to 
take positive action in dealing with new situations of this kind. Generally 
it has waited, sometimes procrastinated, until sufficient evidence had ac- 
cumulated to demonstrate clearly that existing prescriptions and procedures 

9 For a point-by-point rebuttal of Hewart's charges in terms of British bureaucracy, sec 
Finer, Herman, The British Civil Service, ch. 7, London: Fabian Society and Allen & Unwin, 
1937. 

10 For tempered studies of the problem of administrative adjudication, see Pennock, 
J. Roland, Administration and the Rule of Law, New York: Farrar & Rinehart, 1941; Blachly, 
F. F. and Oatman, Miriam E., Administrative Legislation and Adjudication, Washington: Brook- 
ings Institution, 1934; Dickinson, John, Administrative Justice and the Supremacy of Law in 
the United States, Cambridge: Harvard University Press, 1927; Landis, James M., The Adminis- 
trative Process, New Haven: Yale University Press, 1938; Cushman, Robert E., The Inde- 
pendent Regulatory Commissions, New York: Oxford University Press, 1941. 

H See note 10. 



BUREAUCRACY FACT AND FICTION 61 

were inadequate to protect the public interest or safeguard individual 
welfare. However, f ^J p S ! ^ aflirp did *f forth ** hrst it could the criteria 
of the common^good, and thenjvested the power to apply those criteria 
either in sojme^administrative agency within the executive bran^.omZnew 
agency independent of iF^an^norMally independent of the judicial branch 
as well. Far from forsaking the ideal of justice, however, what the legis- 
lature had in mind in assigning such tasks was to bring novel responsibilities 
of government within a more resilient rule of law, one ensuring more sub- 
stantive knowledge for judgment, simpler and swifter in procedure, and 
less expensive to the litigant, 12 yet withal equally just. In brief, legislators 
only sought to cope with the practical problem of devising ways and means 
for the equitable and expeditious settlement of a mounting mass of tech- 
nical cases and controversies. 

Flexibility of Statutory Standards. It is difficult to devise criteria and 
standards for new fields that will be acceptable as squaring fully with those 
to which in familiar situations men have grown accustomed. Instead of 
pretending to a knowledge they have lacked and could not have legis- 
lative bodies have had the wisdom to vest in specialized tribunals and 
comparable agencies the general responsibility for deciding what specific 
requirements would be right or reasonable in their particular fields. v JR>cc : 
ognizing jthat_a^dcgrcc..oL.discretion- hadlo hf .rIgrsH sorn*MirVwfl in ruling 
witlTnew issues, legislatures have conferred ..it. .at kast for rhr ..purpose of 
establishing the^ relevant facts, upon officials possessed of technical knowl- 
edge. "OFcourseT such officials were required to observe fundamental rules 
of evidence in their work. Thus, statutes defining standards have used such 
phrases as "reasonable rates," "public convenience and necessity," "un- 
reasonable discrimination," "action necessary or desirable in the public 
interest," "adequate facilities and services," "maintenance of a fair and orderly 
market," and the like. 13 Interpretation of these phrases has been left largely 
to the regulatory agencies, and as a last resort to the courts. 

Quasi-judicial Agencies. By 1946, Congress had established six major 
quasi-judicial agencies outside the executive branch: Interstate Commerce 
Commission, 1887; Federal Trade Commission, 1914; Tax Court of the 
United States, 1924; Federal Communications Commission, 1934; Securities 
and Exchange Commission, 1934; and National Labor Relations Board, 
1935. The national legislature had also enacted scores of regulatory measures 
calling for the exercise, under appropriate rules of procedure, of consider- 
able discretion by administrative officials within the executive branch. 
State legislatures have found it advisable to follow a similar course within 

12 In their concern for the preservation of the rule of law, bench and bar have tended 
to ignore the matter of the costs of justice to the litigant in terms of both time and money, 
especially the latter. Its importance as a factor in the creation of administrative tribunals has 
been considerable, in America and abroad. 

!8 Sec Pennock, op. cit. t p. 31. 



62 BUREAUCRACY FACT AND FICTION 

their jurisdiction; so have the municipal councils in every large city through- 
out the land. And the end is not yet. Although the question of whether to 
vest such discretion in agencies within or outside the executive branch is 
still a moot one, American experience witb^administrativc tribunals is by 
now sufficiently broad and vaiiedLfor some generaLconcIusions. Those 
who have studied- it . jnost carefully are generally agreed that both the 
graduaMos^by^the^ courts of their former uncontested control over public 
administration and the par tial^rcjglacemeat. . of ) udicial guarantees by ad- 
ministrative guarantees ot "liberty under law" have jiot ^brought the citizen 
un"der a new"3espotism. Oh the contrary, without the aid of such agencies 
he might 'Have been unable to maintain his liberties against the powerful, 
though impersonal, forces which have been rising about him. 14 

Administrative tribunals are here to stay; the problem is how to perfect 
them. This comes down largely to the question of how to improve their 
personnel. Ideally, perhaps, most of the professional staff of a regulatory 
agency should have a mastery of both the technical subject matter with 
which it deals and the legal principles and procedures that govern such 
matters as the conduct of hearings and the taking of evidence. However, 
these are two distinct specializations, and few would be specialists in both. 
The legal profession, as it becomes reconciled to the need for administra- 
tive adjudication, naturally believes that the best way to secure a proper 
balance between private rights and public interests in the regulatory proc- 
ess would be through stress on legal training. 15 Yet lawyers should not 
be allowed to substitute their judgment on technical matters for that of 
subject-matter experts. Obviously, the practical course for every agency 
of administrative justice to take is to staff itself with personnel of both 
types and make sure that consideration is given to both sets of factors. 

14 For a more specific discussion, sec below Ch. 10, "Independent Regulatory Establish- 
ments." 

15 Much pertinent information is to be found in the reports of the United States Attorney 
General's Committee on Administrative Procedure, Washington: 1940-1941; the report on 
Administrative Adjudication in the State of New Yor^, submitted to Governor Herbert H. 
Lehman by Robert M. Benjamin and staff, 1942; and the Tenth Biennial Report of the Judicial 
Council of California to the Governor and the Legislature, 1944. Some indication of the num- 
ber and variety of state administrative agencies engaged at least partially in adjudicatory work 
may be gained from the following list of agencies described by the California Judicial Council 
as conducting "formal, adjudicatory licensing and disciplinary proceedings": Board of Dental 
Examiners, Board of Medical Examiners, Board of Osteopathic Examiners, Board of Nurse 
Examiners, Board of Optometry, Board of Pharmacy, Board of Public Health, Department of 
Public Health, Board of Examiners in Veterinary Medicine, Board of Accountancy, Board of 
Architectural Examiners, Board of Barber Examiners, Board of Registration for Civil Engineers, 
Registrar of Contractors, Board of Cosmetology, Board of Funeral Directors and Embalmers, 
Structural Pest Control Board, Yacht and Ship Brokers Commissioner, Secretary of State, State 
Fire Marshal, State Mineralogist, Director of Agriculture, Labor Commissioner, Real Estate 
Commissioner, Commissioner of Corporations, Department of Social Welfare, Department of 
Institutions, Board of Pilot Commissioners for the Bays of San Francisco, San Pablo and 
Suisun, Board of Pilot Commissioners for Humboldt Bay, Board of Pilot Commissioners for the 
Harbor of Saij Diego, Fish and Game Commission, Board of Education, Board of Equalization, 
Insurance Commissioner, Building and Loan Commission. 



BUREAUCRACY FACT AND FICTION 63 

In taking leave of the alleged decline of freedom in the New Levia- 
than, we can perhaps do no better than record the considered opinion of 
Blachly and Oatman of the legislative proposals advanced by the American 
Bar Association in the late 1930's for additional judicial safeguards against 
abuses of discretion by administrative agencies. "It appears," they ob- 
served, "that the 'tendencies toward administrative absolutism' so feared 
by certain promoters of the American Bar Association bill are largely 
nonexistent." 16 

4. THE BATTLE AGAINST REGIMENTATION 

Parallel to the accusation that bureaucracy has been usurping the func- 
tion of the courts runs the charge that it has also encroached upon the 
legislature. 17 Administrative adjudication does indeed have a counterpart 
in administrative rule-making. Most of those who dam'n the new despotism 
are therefore also prone to denounce bureaucratic "regimentation." 

Experience Abroad. It may conduce to a sounder analysis of American 
developments 18 to look first at Britain and France, democratic countries both. 
As to the latter, the essence of the matter can be stated readily. The French 
are logical and practical about the need for administrative rule-making, 
as they are about many other things. Under the Republic, every statute 
of consequence enacted by the national parliament included a section 
to the effect that "an ordinance of public administration shall deter- 
mine the measures proper for securing the execution of the present law." 19 
The French legislature had no qualms about conferring upon adminis- 
trators the task of settling points of detail in public policy. 

The British attitude toward what they call "delegated legislation" is not 
described as easily. Although there is in England greater readiness to 
accept the necessity of administrative regulations than in the United States, 
the House of Commons has concerned itself with this matter no less than 
three or four times in the past generation. On the first occasion, with 

1<J Blachly, F. F. and Oatman, Miriam E., Federal Regulatory Action and Control, p. 277, 
Washington: Brookinps Institution, 1940. This matter is taken up more fully below in Ch. 
23, "The Judicial Test." 

17 Condemnations of bureaucracy on the ground of regimentation may be found in such 
books as Beck, James M., Our Wonderland of Bureaucracy, New York- Macmillan, 1933; 
Edmunds, Sterling E., The Federal Octoptis, Charlottes villc: Michic Co., 1932; Hoover, Herbert, 
The Challenge to Liberty, New York: Scnbncrs, 1934; Lane, Rose Wilder, The Discovery 
of Freedom: Man's Struggle Against Authority, New York: John Day, 1943; Wriston, Henry 
M., Challenge to Freedom, New York: Harper, 1943; and Sullivan, Lawrence, Bureaucracy 
Runs Amuck, New York: Bobbs-Merrill, 1944. 

18 For objective studies of the need for and the use of delegated legislation, see Andrews, 
John B., Administrative Labor Legislation, New York: Harper, 1936; Blachly and Oatman, 
op. cit. in note 16; Comer, John P., Legislative Functions of National Administrative Authorities, 
New York: Columbia University Press, 1927; Hart, James, The Ordinance-Making Powers oj 
the President of the United States, Baltimore: Johns Hopkins Press, 1925. 

10 Ogg, Frederic A., European Governments and Politics, p. 451, New York: Macmillan, 
1944. 



64 BUREAUCRACY FACT AND FICTION 

Stanley Baldwin at the helm as Prime Minister, the criticism of the House 
was "rejected out of hand," in the words of the London Times. The 
Donoughmore Committee on Ministers' Powers recommended in its re- 
port 20 a closer scrutiny by Parliament of the promulgation of subordinate 
legislation by the executive branch; this led to no significant action. Again, 
during the early part of World War II, a similar proposal was offered but 
was rejected by the government on the ground that its enactment would 
becloud ministerial responsibility. In 1944, however, it was acknowledged 
by the government that additional safeguards should be adopted. Not least 
of the reasons was the belief that in the future, ministers might have to 
issue rules and orders in greater volume than ever before. The Commons 
took up a motion to create 

a Select Committee, . . . whose duty it should be to carry on a continuous 
examination of z\\ statutory rules and orders and other instruments of 
delegated legislation presented to Parliament; and to report from week 
to week whether in the opinion of the committee any such instrument 
is obscure or contains matter of a controversial nature or should for any 
other reason be brought to the special attention of the House. 

This motion was countered by Home Secretary Herbert Morrison with a 
generous offer to go even further. 

Parliamentary Review of Delegated Legislation. By its terms of refer- 
ence the select committee is charged with guarding the powers of Parlia- 
ment and the liberties of the citizen by inquiring into the character and 
effect of the most important types of delegated legislation. Though lacking 
authority to send for ministers, it can ask for the services of departmental 
officers in getting answers to technical questions and securing other rele- 
vant information. This saves it from having to draw the attention of the 
House to a regulation without first consulting with the department con- 
cerned. The committee chiefly examines measures which would impose 
charges on the public revenues, require payments or services to any national 
department or agency of local government, or be immune from challenge 
in the courts. Two classes of orders are to come in for special scrutiny. 
The first includes all orders and regulations which by law do not become 
effective unless approved by affirmative resolution of Parliament. The 
second and larger group consists of rules and orders which automatically 
go into force unless opposed by a prayer or a negative resolution. 21 On 
this basis the British are prepared to go ahead and make presumably not less 
but more use of delegated legislation than they have in times past. 

Like Britain and France, the United States is part and parcel of Western 
democratic and capitalistic civilization. Nothing is more essential to the 
health of this civilization than the maintenance, by such governmental 

20 London: H. M. Stationery Office, 1932, Cd. 4060. 

21 Cf. London Times, May 16, 1944, and the article entitled "Delegation" in the Man- 
chester Guardian, May 18, 1944. 



BUREAUCRACY FACT AND FICTION 65 

action as may be necessary, o an adequate measure of social and economic 
equality among the people and a substantial degree of competition among 
business enterprises. The British and the French nations have been obliged 
during the past century to enact a vast pile of legislation designed to main- 
tain such conditions within their borders; so has America. And the com- 
plexities of industrial society being" everywhere much the same, Congress 
has had to assign the drafting of the detailed regulations implementing 
these statutes to the administrative officials charged with their enforcement 
just as have the House of Commons and the Chamber of Deputies. 

Ignoble Partisanship. This is the general setting for bureaucratic "legis- 
lating" which has given rise to the charge of regimentation. Congress, 
state legislatures, and city councils have placed upon administrative agencies 
responsibility for putting the flesh of life and action on the bare bones of 
skeleton legislation and for making particular statutes and municipal or- 
dinances attain the purposes behind their enactment. The bureaucrats 
proceed as best they can with these difficult tasks only to find themselves 
accused of all manner of evildoing. Why? Because, as often as not, having 
been unable to prevent the passage of the statute itself, those opposed to 
its objectives have retreated to their last line of defense and have endeavored 
on procedural grounds to win a battle already lost. 

Thus the stark facts are frequently simple and on occasion they may 
be sinister. Legislative deliberation may reveal so great a need for regu- 
latory action in a given field that the only possible way left by which the 
opposition may hope to stave off the imposition of controls is through con- 
fusing the issues. This is precisely what is often done. Clearly, the real 
parties to the argument over public regulation of economic activity are the 
representatives of the people in the legislature and the spokesmen for the 
interest groups which desire to avoid the social discipline such regulation 
would place upon them. It is in many instances the calculated intention 
of those who raise the cry of regimentation to befuddle the general public 
into thinking that the issue lies instead between tyrannical bureaucrats on 
the one side and well-meaning citizens on the other. 

Tactics of this kind have always been used by groups endeavoring to 
evade social obligations. There is no reason for expecting that they will not 
be used until the end of time. Of all the fictions about bureaucracy, one 
of the greatest lies in the contention that it is the bureaucrats who are re- 
sponsible for the imposition of governmental controls on economic activity. 
Such controls are established by the duly chosen political representatives 
of the whole people. The much-maligned bureaucrat is but the instrument 
through which they are made effective. 

Matrix of a Mixed Economy. The abuses and insecurities which inevi- 
tably result when men insist on using liberty as though it were license have 
forced an almost continuous retreat from the philosophy of governmental 
nonintervention in the economic sphere. The American economy is a 



66 BUREAUCRACY FACT AND FICTION 

mixed economy. Private and public undertakings intermingle. "Either or" 
studies of the role of government in economic life have value only in point- 
ing out the perils of going to extremes. 22 Many aspects of production and 
distribution can be competently handled by private enterprise under law 
and regulation. Others are so basic to the maintenance of public health, 
comfort, and decency that their management cannot safely be entrusted to 
those who would have to operate under the limitations inherent in the profit 
motive. In between lie fields and the area is rather extensive which lend 
themselves equally well to private, public, cooperative, or combined efforts. 

Experimental Accommodation. How far public ownership and opera- 
tion need to be carried and how far governmental regulation of private 
enterprise will have to go are certainly not questions which bureaucrats will 
be allowed to answer. Fundamentally, these are matters of high public pol- 
icy. No one can predict with certainty what functions of regulation or 
control governmental management will be performing a generation hence. 
This does not mean, however, that no clues are available to suggest what the 
future will bring. It is quite evident that we arc not following any clear 
line of theory that would enable us to anticipate impending development. 
We do have the light that comes from the lamp of experience, and for a 
people as pragmatic as ours that should be a very good light. The likeli- 
hood of socialism is at a minimum. We shall go on in the future as in the 
past, doing what viable governments have always done gradually adapting 
forms and processes to changing conditions and circumstances. 

In our long record of evolutionary rather than revolutionary adjustment 
there should be quite a little reassurance for those inclined to be anxious 
about the morrow. It should be sufficient to keep them from rejecting the 
universe and the century in which they live. The volume of governmental 
regulation of economic activities is doubtless destined to expand further. 
Such gradual expansion would spell regimentation only if we allowed our 
sense of social responsibility to deteriorate and die. 

5. THE NEED FOR UNDERSTANDING 

Democracy, it is agreed, rests on understanding between the citizen and 
his government. If this is to have any real meaning it is equally essential 
that there be understanding between the citizen and his civil servants, 
inasmuch as most of the citizen's contacts with his government are through 
administrative personnel rather than through political officials. Obviously 
the maxim should work both ways; the bureaucrat's need to understand 
the citizen matches the citizen's need to understand the bureaucrat. As a 



22 The year 1944 saw the publication of two volumes that illustrate only too well the 
limitations of the either or kind of analysis: Miscs, Ludwig von, Omnipotent Government, 
New Haven: Yale University Press, 1944; and Hayek, F. A., The Road to Serfdom, Chicago: 
University of Chicago Press, 1944. For a vigorous rejoinder, see Finer, Herman, The Road to 
Reaction, Boston: Little, Brown & Co., 1945. Cf. also Wootton, Barbara, Freedom under 
Planning, Chapel Hill: University of North Carolina Press, 1945. 



BUREAUCRACY FACT AND FICTION 67 

practical matter, however, the more urgent necessity in the present age is 
for greater public understanding of the administrative process. 

Psychology of Public Employment. Consider the ordinary man or 
woman "working for the government." The government worker is recruited 
from no special rank or class or circle within American society; his back- 
ground is the same as that of the average citizen. He is increasingly obliged 
to give objective proof of competence first, to get his job, and thereafter to 
gain promotion or advancement. His compensation may be sufficient to 
enable him to support his family on an acceptable scale of living but it is 
never of large proportions. 

He does his work hedged about by a mass of rules and regulations which 
have - accumulated over the years as the embodiment of popular attitudes 
toward the conditions of public employment. Much of what he does may 
be floodlighted at any time by pitiless publicity; all of it is subject to the 
most intensive and pervasive scrutiny. His chances of taking advantage of 
society in furtherance of his own ends should he be so minded, arc fewer 
and more circumscribed than are those of thousands upon thousands of his 
fellow citizens who arc privately employed. 

Yet why presume that he will be so minded? In the first place, no per- 
son desiring to lay his hands on material riches would be attracted to the 
public service. The majority of government employees are engaged in such 
work because the positions offered them held the promise of being "good 
jobs," or at any rate fair ones. It is not only a mistake, but even an injustice, 
not to remember that the bulk of them are public servants because that is 
what they want to be because the idea of serving the community through 
its government appeals to them as the best of all ways to make their living 
and to spend their lives. 

For these public servants the taking of an oath of loyalty merely formalizes 
a resolution already made. It amounts to an outer expression of an inner 
dedication the legal aspect of a code of ethics by which the public em- 
ployee is guided in all his official acts and by which he expects all his fellow 
workers to proceed. An administrative official no more seeks his position in 
order to be able to sit in arbitrary judgment over the public than does a 
judge. 

Let the government business be what it may, when it comes before the 
administrator for action, his whole disposition is to ask himself a series of 
questions on this order: What do the Constitution and the statutes say on 
this matter? What was the intent of the makers of policy in passing the 
law? What discretion am I obliged or expected or allowed to exercise? 
How can I best exercise that discretion to promote and preserve the public 
interest? There need be little mystery about the workings of bureaucracy 
for anyone honestly interested in finding out the facts. Administrative offi- 
cials admittedly make mistakes in judgment just as do other human beings. 
However, any intimation that the typical official counts that week lost in 



68 BUREAUCRACY FACT AND FICTION 

which he has not perpetrated some evil on the public is as base as it is 
ludicrous. 

Veil of Official Anonymity. One thing that would doubtless make it 
easier for the public to overcome its misconceptions about the civil service 
would be a better understanding of the reasons for official anonymity. There 
are two main aspects of the matter. One is the maintenance of anonymity 
,by bureaucrats in their capacity as advisers to their political chiefs. The 
other is their avoidance of public self-identification as personalities tied into 
the work of governmental administration. Let us examine these two aspects 
in reverse order. 

Any administrative system operating under a government of laws re- 
quires some degree of official anonymity. Without it there would be no 
way of honoring the basic principle that administrative agencies are fun- 
damentally the impartial and impersonal instruments through which gov- 
ernment performs its functions. The officials of such agencies are not 
supposed to place upon their actions the stamp of their own individual 
personalities. On the contrary, their job is merely to be the efficient device 
through which the will of the people finds tangible expression. 

Yet various difficulties arise when in his official life the bureaucrat 
endeavors not to be John A. Smith, William B. Jones, or Edward C. Brown 
and tries instead to be something like a disembodied executor of public 
policy. For one thing, he runs up against the fact that though theoretically 
the people want him to control his personal views or preferences and func- 
tion only as "the Administrator," "the Bureau Chief," "the Clerk," or "the 
Licensing Officer," many of those with whom he has to deal want him to 
handle their cases on a "What's-the-law-between friends?" basis. Friends? 
Yes and no. Certainly it is not an uncommon experience for administrative 
officials to have citizens presume upon personal acquaintance with them by 
asking for favored treatment. And there are always plenty of others looking 
for an opportunity to establish such acquaintance so that they may presume 
upon it. The official's reaction is usually what might be expected. Knowing 
that even acquiescence in such presumptions could be ruinous, he relies as 
much as possible upon official anonymity to discourage them. He can easily 
go too far. Often his desire to underscore the impersonal character of his 
relationship with his citizen-client may lead him to excessive formality in 
address and conduct. 

Basically, this is the cause of the development and usage by govern- 
mental officials of that wooden diction formerly known as officialese and 
now as gobbledygook. Percival Q. Adams of 1456 Jefferson Street, Missouri- 
ville, Missouri, probably considers his application for a license or his tax 
return a matter quite as intimate as it is momentous. He does not want the 
licensing officer or the tax collector to treat him as if he were merely a 
number. He does not like to see himself referred to in the third person. 
Nor does he appreciate the deliberate way in which administrative officials 



BUREAUCRACY FACT AND FICTION 69 

often seem to avoid speaking of themselves in the first person when writing 
him about things for which they are supposed to be personally responsible. 
At its worst, officialese becomes so inverted and involved as to be little short 
of maddening. The bureaucrat may think his formalities nicely calculated 
to make the citizen "keep a proper distance." The citizen is more likely 
to feel that the bureaucrat has built a wall between them. 

Official anonymity also stems from the bureaucrat's wholly understand- 
able desire to escape being made the victim of unreasoning and indiscrimi- 
nate criticism. The body politic accepts years of competent and faithful 
service without comment or commendation. However, let a bureaucrat 
make some little slip or merely be charged with making one, and the 
chances are that he and his agency will have to pay a price in loss of popu- 
lar support and esteem out of all proportion to the error done. Is it any 
wonder, therefore, that to the bureaucrat the public sometimes seems to be 
a dangerous beast which should be avoided? There are always people 
anxious for their own purposes to exploit the faults and shortcomings of 
the government employee. What reaction could be more natural for him 
than to contrive to reduce his exposure to such people to the absolute 
minimum? 

Teams and Cogs. Having considered the needs and the uses of official 
anonymity in the relation between the official and the citizen, let us look 
at the matter now from the internal angle, that is, within the bureaucracy 
itself. No administrative agency can succeed in the discharge of its function 
unless its staff works as a team or as a related group of teams. Each em- 
ployee, of course, will have his individual assignment, and, with regard to 
his particular job, he should to a degree be on his own. Yet this consideration 
must always be subordinated to cooperative needs so that the net result 
becomes an "organized" product embracing the whole work of the agency. 23 
Every member of the staff must learn that what he does commits the agency 
itself to some extent. How to instill this essential discipline among all the 
employees under him and yet not kill their spirit of initiative is one of the 
toughest problems the head of any agency or the chief of any unit has to 
face and it has to be faced continuously. 

Not all of those confronted with this problem manage to solve it satis- 
factorily. Some generate in their staffs so great a fear of committing the 
agency to someth ng wrong that their employees take refuge in a timidity 
that keeps them from being positive or effective about anything. Others may 
require their personnel to conform in their mode of work to so narrow 
and rigid a group routine that all become in practice little more than 
robots, cogs on the wheels of government, slaves of an asrembly-line. For- 
tunately, there are others in directive or supervisory positions who exercise 
special initiative in highlighting for their subordinates the public purpose 



28 For an elaboration of this concept, see Appleby, op. cit. in note 4, p. 78 ff. 



70 BUREAUCRACY FACT AND FICTION 

which the agency was created to serve and the specific services which it 
must render in carrying out its responsibilities. They endeavor to show 
each employee precisely how and where his job fits into the whole effort. 
Finally, through the practice of office democracy and active concern for the 
welfare and self-development of all employees, they prove to each member 
of the staff that he is regarded as a fellow worker and that his work plays 
a significant part in the group enterprise. 

Ethics of Political Counsel. Official anonymity has its most specific use 
in concealing the identities of bureaucrats in their capacities as advisers to 
political chiefs. It is an obvious obligation of the permanent administrative 
staff, especially those near the top of an agency, to give their political chief 
the soundest advice of which they are capable, and, under the laws, to 
carry out his policies with loyalty and efficiency, irrespective of how much 
or little of their counsel he accepts. Not having the authority to make pol- 
icy, permanent staff or line officers cannot identify themselves with the 
responsibility for making it. Only yesterday the professional bureaucrat 
advised the predecessor of his present political chief. On some tomorrow he 
will be advising his chief's successor. If today he is to try as hard to help 
his present chief succeed as he tried to help others in the past and as he 
expects to help still others in the future, it can only be on the basis of ten- 
dering his counsel within the four walls of the agency. Under the protec- 
tion of anonymity his code of ethics calls for excluding from his mind all 
considerations except those related to the policy program of his political 
chief, the public interest, and the general welfare. 

Fact Over Fiction. Granted that the government bureaucracy contains 
its share of drones and dullards, of self-servers and time-servers, of minor 
tyrants and soulless automatons, these comprise all told but a fraction of the 
total. Man for man and woman for woman, there is not now and there 
never has been any reason for believing them to be different from their 
fellow Americans who are self -employed or work in private industry. The 
American bureaucracy is now so numerous that no citizen can indict it 
without indicting the nation itself. 

The fictions about bureaucracy will go on circulating, but there is rea- 
son to expect that they will do so at a gradually decreasing rate. Year by 
year the circle of popular understanding will grow wider. As it does, the 
public will more generally come to appreciate the limitations under which it 
has made its civil servants work. 

American democracy has thousands of exceptionally gifted and devoted 
employees who not only make no fuss about being bureaucrats but on the 
contrary are proud of the fact and grateful for their tasks. We can see them 
as a composite picture when we think of individuals such as these: a con- 
fidential adviser to the President destined to die years before his time because 
of refusal to reduce his labors in proportion to his waning strength; a 
journalist endowed with unusual capacity for management willing to let 



BUREAUCRACY FACT AND FICTION 71 

his private fortunes slide in order to aid in the reorientation of a great de- 
partment; a lifelong government engineer drafted to run a top war agency 
after half a dozen industrialists had managed to get all snarled up in it; 
a brilliant former state utility commissioner prepared to undergo periodi- 
cally the bitterest vituperation in order to demonstrate democracy's ability 
to achieve the creative rehabilitation of a river valley; a genius in the per- 
fection of budgetary methods and the direction of fiscal operations who 
never had any other professional ambition than to help his government 
translate its work program into accomplishment with the greatest possible 
economy to the taxpayer; a director of an agricultural experiment station 
still going strong after nearly forty years of helping the people of his state 
in the wise and responsible use of their human and material resources; a 
veteran city manager, demonstrating through his efficiency and his devotion 
to his community the promise and potentialities throughout the nation of 
a public-spirited profession of municipal management; thousands upon 
thousands of clerks, secretaries, and stenographers rendering competent and 
faithful service at their jobs year after year. 

These are the bureaucrats by whom the people of the United States 
are served. It is unthinkable that the day will not dawn when their work 
will receive the recognition it deserves. 



CHAPTER 



4 



Democratic Administration 



1. LEGISLATIVE-EXECUTIVE RELATIONSHIPS 

Prophets of III. The men who drafted the Constitution of the United 
States had had experience with both hereditary monarchy and a confedera- 
tion in which a legislative assembly possessed exclusive power. As they 
considered the kind of executive head they wished to create, it seemed that 
they must choose between tyranny and anarchy. Being sensible men, they 
refused both. Instead, they invented a national chief executive with broad 
powers who was to be chosen periodically by majority vote and, as it 
turned out, by popular election. 

The adoption of the Constitution, of course, did not end controversy over 
the powers and functions of the President. The presidency has been popu- 
lar enough to last longer without fundamental change than the office of 
any other chief executive in any major nation. But many have disliked it, 
feared its influence, and believed that to protect our liberty we should 
restrict its initiative and independence. 

In recent years, the contest over the powers of the presidency has broad- 
ened into a debate over the functions of the executive agencies of govern- 
ment and their personnel. In these terms, of course, the issue is more realis- 
tic in the light of recent world history. It is no single "man on horseback," 
but a dominant party or class, that can threaten a nation's liberty. The 
administrative personnel of all our governmental bodies, therefore, may well 
consider what their role should be in a democratic society. 

Critics of the part that present-day public administration must play have 
given administrators something to think about. Mr. James Burnham, for 
example, has cheerfully assured us that public administrators, along with 
corporation managers, are going to exploit the rest of us, who will con- 
stitute the new proletariat. 1 Others, like Hayek and Mises, have warned 

1 Burnham, James, The Managerial Revolution, New York: John Day, 1941. 

72 



DEMOCRATIC ADMINISTRATION 73 

that the modern service state will reduce us all to servility just because we 
have asked its administrators to organize our welfare and security. 2 

Such charges are not new. These scholarly jeremiads, as a matter of 
fact, have a familiar and even tiresome ring to those who have heard the 
same arguments used, in less academic language, in municipal politics. 
When cities, in order to get their streets paved or their milk inspected, hire 
city managers or strengthen the powers of their mayors, plenty of out- 
raged critics usually protest that the democratic system is being undermined. 
These attacks appear to carry weight in proportion to the lack of funda- 
mental agreement over the objectives of government. In cities where there 
has been little factional dispute over fundamental policy, arguments of this 
sort are largely ignored. 

Whenever they are taken seriously in municipal, state, or federal affairs, 
they lead the public to turn to the stock prescriptions of those who wish to 
weaken the executive power that democracy will be safeguarded only if 
the legislature controls the details of administration by statute, only if the 
civil service completely shuns questions of policy and leaves all initiative 
to the lawmakers, only if the national government stays out of state and 
local affairs and government in general stays out of business. Yet no admin- 
istrative official can work by these maxims. Like any other citizen, the 
administrator in his particular sphere must be concerned about the difficulty 
of giving democracy effective control over the powerful forces that have been 
set free by science. If he thinks that democracy is defined by the maxims 
of antigovcrnmental politics and still tries to do his job, he is likely to decide 
that the management of public affairs cannot be democratic and efficient 
at the same time. 

Some administrators, no doubt, have come to this defeatist way of 
thinking. Just as Lord Melbourne thought that religion was a fine thing 
so long as it did not interfere with a man's private life, so some govern- 
mental managers may think that democracy is a fine thing so long as it 
does not meddle with the management of public affairs. Nor is this merely 
an error of governmental managers. In advancing the old argument that 
government should be run like a private corporation, certain political re- 
formers have meant only that government should be efficient, while others 
have meant that the way it is run should be none of the public's business. 

However, many of the men and women who have distinguished them- 
selves both as public servants and as students of politics have shown little 
disposition to look on politics as a millstone round the neck of governmental 
management. On the contrary, they understand that, in a broader sense, 

2 Hayek, F. A., The Road to Serfdom, Chicago: University of Chicago Press, 1944; Miscs, 
Ludwig von, Omnipotent Government, New Haven: Yale University Press, 1944. A sharp 
dissent has been voiced by Finer, Herman, The Road to Reaction, Boston: Little, Brown & 
Co., 1945. Sec als-o Wootton, Barbara, Freedom under Planning, Chapel Hill: University of 
North Carolina Press, 1945. 



74 DEMOCRATIC ADMINISTRATION 

efficient administration and democratic administration are one and the 



same/* 



In spite of the defects of our present system, we ought not to overlook 
the ways in which our society has operated with a comparatively high degree 
of consent and a low degree of compulsion. These ways may well offer 
the public administrator more opportunity for enterprising service, though 
considerably less security and immunity from criticism, than any political 
Utopia devised by nostalgic critics. 

Dangers of Oversimplification. The importance of keeping adminis- 
tration accountable to a representative body will never grow less, no matter 
how strong a sense of professional responsibility public officials may develop, 
no matter how exact may become their standards of service. The funda- 
mental powers and prerogatives of the legislature are as essential today 
as they were when men first risked life itself to assert them. It is hard to 
imagine how a government can be democratic unless its legislature is 
elected periodically by a free vote; unless the members of the legislature 
and legislative proceedings are free of executive coercion and corruption; 
and unless public officials administer their offices according to the statutes 
and spend money according to the legislative appropriations all in an en- 
vironment of free thought and free speech. 

If we start with such a political assumption, how seriously should the 
administrator take the argument that the legislature should frame policy 
in complete independence of the executive branch and also assert its control 
over the details of public affairs? 

It does not make sense to expect the legislative and executive branches 
to work in harmony, and then to condemn the legislature for too sym- 
pathetic consideration of executive proposals. To some extent the public is 
led into such inconsistency by the etiquette of a system of separation of 
powers, in which leaders of the legislature are likely to be jealous of the 
influence of the chief executive and his agencies. However, some of the 
most violent feuds over legislative-executive relations in the United States 
have developed in cities with council-manager government, in which the 
city manager is the appointee of the council and has no formal independence 
of it whatever. Perhaps the basic reason is that the American people, con- 
sidering themselves responsible for creating their governmental arrange- 
ments by rational acts of will, expect the machinery automatically to conform 
to the logic of charters and constitutions. Obviously, the public docs not 
police compliance with these documents on its own initiative. However, the 
legislator or official who chooses to raise an issue of procedural relationships 
between the branches of government can usually count on popular attention. 

There are always reasons for raising such issues. The legislative oppo- 
sition frequently finds it expedient to argue that the party in power is giving 



3 For example, see Appleby, Paul H., Big Democracy, New York: Knopf, 1945. 



DEMOCRATIC ADMINISTRATION 75 

up legislative prerogatives, thus calling on the corporate pride of lawmakers 
to reinforce an argument of policy. In 1944, for example, Democrats in 
Albany were denouncing the Republican majority of the New York State 
Assembly for subservience to Governor Dewey while the governor's cam- 
paign captains were denouncing the Democrats in Congress for subservience 
to President Roosevelt. Then, too, a lobbyist likes to bolster his case with 
the phraseology of the classic attacks on tyranny; a press agent for a vested 
interest can do no better than sound like Tom Paine. And newspaper 
reporters, who seem to specialize in public disagreement, often find proce- 
dural issues the best material available, in the absence of consistent 
disagreement on policy. 

The administrative official himself is hardly likely to be impressed by 
these issues. By the very nature of his work, he is or ought to be proof 
against the assumption that the legislative and executive branches are fun- 
damentally in conflict. He knows that all the major aspects of his program 
depend on their general agreement. When he thinks in practical terms, he 
has to regard the mayor, for example, as being his boss for some purposes, 
the council for others. He is realistic enough to understand also that in a 
great many matters of administration or even policy he must make deci- 
sions himself without being under the immediate control or guidance of 
either the mayor or the council, and that in lesser matters his subordinates 
also must be similarly independent of him. Without delegation of this kind, 
no governmental organization can operate. 

It is important for the administrative official to keep his thinking straight 
on the large and rather obvious aspects of his relations with the legislature 
and the chief executive. Clearly, the real problem is not legislative-executive 
relations as much as the relationship between an operating agency, on the 
one hand, and the legislative body and chief executive, on the other. 

Control by Delegation. Given sound relationships, many questions sim- 
ply solve themselves. What, for instance, of the century-old complaint that 
administrative agencies are issuing too many orders, and that the legislature 
is giving up its right to settle questions by statute? A federal administrative 
official knows that his bureau tfow settles by its own orders many matters 
that only a few decades ago were the subject of departmental action, or 
even an order by the President. As the volume of work increased, the 
numerical quantity of decisions naturally increased in greater proportion 
at lower levels. The practice of leaving minor matters to be handled at 
lower levels strengthened the control of the higher executive at each level. 
Indeed, only a systematic practice of directing the lower official to take 
responsibility for details can enable a higher official to control him. The 
sheer quantity of work to be done by any large organization makes such 
selective delegation essential to administrative control. The same principle 
must be applied to legislative control. Just as the President can direct the 
executive branch only if he concentrates his personal attention on the most 



76 DEMOCRATIC ADMINISTRATION 

important matters and delegates the minor ones to others, so Congress can 
determine national policy by legislation only if it focuses on the great issues 
and leaves the lesser ones to be handled by the President. 

Similarly, an executive is eager to have his subordinates develop and 
propose new policy. Administration is quite unlike the writing of poetry or 
other forms of personal inspiration; as the old wisecrack has it, an adminis- 
trator is one who never writes what he signs or signs what he writes. This 
is inevitable because the creation of policy is a collective process one of 
gathering ideas and facts and combining them into a program. When a 
city manager finds the proposal of a department head acceptable, it is a 
sign of good teamwork; when the council finds the proposal of a city man- 
ager acceptable, some faction will surely accuse it of being a "rubber stamp." 
It is time that someone asked the obvious question: If a legislature, un- 
coerced and unintimidated, agrees after open discussion with the proposals 
of its chief executive, is it not a sign of effective democracy rather than of 
shameful submission? It is pure romance to consider disapproval of a sub- 
ordinate's recommendation a sign of independence. The effective super- 
visor whether legislative or executive gets his policies carried out by 
inducing his subordinates to develop and execute his general program. To 
do so, he must reach an understanding with them about his goals at an early 
stage in the formulation of policy, so that he rarely needs to reject a specific 
proposal and start all over again. 

A large legislative body will always find it difficult or impossible, even 
through committees, to keep in touch with all the advance planning of 
administrative agencies and to control the detailed application of policy. 
The legislator is tempted by short-run interest and pressure from his con- 
stituents to make up for this limitation by political interference with mat- 
ters that for best performance ought to be delegated the selection of indi- 
vidual officials, the location of field offices, the letting or cancellation of 
contracts, the modification of administrative orders. This temptation is apt 
to defeat the whole purpose of legislative supervision, which is to define the 
major lines of policy for the executive branch to follow. 

Democracy and Legislative Supremacy. Let us consider the classic exam- 
ple of parliamentary government. It is easy to see how a legislature may 
keep administration generally responsive to its control by only the broadest 
kind of supervision. The British Parliament delegates far more rule-making 
power to the executive branch than would be constitutionally possible in 
the United States. Among the subjects covered by such rules is the whole 
problem of governmental organization. The outlines of departments and 
their divisions, and also the membership and structure of the Cabinet itself, 
are not fixed by legislation but by Orders in Council, Treasury memoranda, 
or even less formal documents. Moreover, while the House of Commons 
discusses the main policies proposed by the Prime Minister, it rarely alters 
them. In effect, individual members acting for themselves cannot get 



DEMOCRATIC ADMINISTRATION 77 

amendments to any important legislation considered by the House, and 
the House has not altered the executive budget during this century. Mem- 
bers of the House have never been able to interfere with administrative 
details; by the time that "His Majesty's Service" became a fiction and both 
the Cabinet and the civil service came under the control of the House, the 
doctrine of collective responsibility of the ministers as the Cabinet induced 
them to keep other members of the House from interfering with the direc- 
tion of their departments. 

For our purpose, the primary fact is that British administration became 
democratic as the legislature restricted itself to a very general kind of super- 
vision. Nor can we consider it paradoxical that general legislative control 
should be improved by the prevention of legislative actions aimed at details. 
It was one of the main purposes of our Constitution to take certain types 
of executive actions out of the hands of the legislature, breaking boldly with 
a habit that had developed in nearly every early state legislature and in the 
Congress of the Confederation. As Thomas Jefferson wrote a friend shortly 
before the Constitutional Convention met, "I have ever viewed the executive 
details as the greatest cause of evil to us, because they in fact place us as if 
we had no federal head, by diverting the attention of that head from great 
to small subjects." 4 

Even after the adoption of the Constitution, it was and is still possible 
for Congress, in sharp contrast to the House of Commons, to keep its fingers 
on all kinds of executive details through its standing committees. But any- 
one who believes this difference an inherently national one should consider 
the contrast in local government. General management of British cities 
rests with committees of the city councils, council members being elected 
by wards. Most large American cities, and nearly all the better governed ones, 
are administered either by strong mayors or city managers, while the indi- 
vidual members of the comparatively small councils do not participate in 
the direction of administrative affairs. The most delightful aspect of the mat- 
ter is that Americans are apt to call the parliamentary system undemocratic 
whenever they learn how much power it places in the Prime Minister, while 
British municipal officials consider the city-manager plan and strong-mayor 
plan quite dictatorial and un-British, whatever administrative merits these 
plans may possess. 

Legislators Versus Legislatures. In general, a legislature does not make 
administrators responsive to representative control either by settling details 
in statutes or by refusing on principle to support policies proposed by the 

4 To Edward Carrington from Paris, August 4, 1787. The Life and Selected Writings of 
Thomas Jefferson, p. 428, New York: Modem Library, 1944. However, even Jefferson per- 
mitted himself moments of cynicism. At the age of 77, when recalling the Congress of the 
Confederation, Jefferson wondered "whether Bonaparte's dumb legislature, which said nothing, 
and did much, may not be preferable to one which talks much, and does nothing." And he 
added, "That one hundred and fifty lawyers should do business together, ought not to be 
expected." Jefferson's Autobiography, in op. cit. p. 61. 



78 DEMOCRATIC ADMINISTRATION 

executive branch. This point is often obscured, however, because a legisla- 
ture does not speak to the public with a single voice. Being composed of 
a majority and a minority, it may in general stand behind the chief execu- 
tive, and at the same time through a vocal minority in control of certain 
committees appear to oppose him vigorously. It is then only natural for 
the newspapers to give the public the impression that the executive branch 
is carrying out a policy over the opposition of the legislature. What is called 
"executive usurpation" often resolves itself into a case in which the majority 
of the legislature fails to defend against minority attack the policy that it 
is generally supporting. 6 

If it is entirely democratic for an administrator to carry out the intent 
of the legislature in the face of attacks from individual legislators or legis- 
lative committees, another point becomes apparent. Representative control 
can be fully accomplished only if the chief executive and the legislature 
work in harmony the former to maintain effective control over his depart- 
ments and bureaus, the latter to keep its individual members and commit- 
tees from using tricks of procedure to block its general program. The real 
issue of representation and responsibility is not simply between the chief 
executive and the legislature, but between the two, on the one hand, and 
each and all of the departments, bureaus, and legislative committees that 
seek to go their own ways, on the other. The great advances in attaining 
administrative responsibility to the legislative branch which have been 
achieved in the United States have been made possible by strengthening 
the chief executive, who alone can present to the legislature a coherent pro- 
gram over and through which broad and democratic control can be exercised. 

In exercising such control, the legislature needs staff assistance in the 
review and interpretation of facts, the appraising of programs, the drafting 
of bills, and other technical work. It must have committee secretariats, legis- 
lative reference aids, and parliamentary counsel to fit itself for its tasks of 
general surveillance, just as a chief executive needs the tools of management 
that are appropriate to executive control. However, the committee members 
must keep decisions in their own collective hands and direct their staff 
toward matters of proper legislative concern. Any legislative staff that is 
allowed to reach into the particulars of agency operations becomes in effect 
a rival administrative department, with all of the power of the executive 
officials and none of their responsibility for results. 

2. THE PUBLIC AS STAR CUSTOMER 

Methods of Opinion Analysis. A legislature, even if bicameral, is essen- 
tially a single body. As a body, it can act only on a limited number of 
important problems. Its influence, however, extends beyond its formal acts. 
An alert administrative agency does not merely comply with statutes; it 

6 Leigh, Robert D., "Politicians vs. Bureaucrats," Harper's Magazine, January 1945, Vol. 
190, pp. 97-105. 



DEMOCRATIC ADMINISTRATION 79 

seeks to anticipate the drift of public opinion, to develop policy proposals 
today that will meet the legislative demands of tomorrow. For this reason 
it wishes to keep in touch as closely as possible with public opinion. It may 
do so partly by new and specialized methods of analysis, but it is likely 
to depend mainly on compiling and appraising in a systematic way the 
information that flows in as a result of its ordinary operations. 

One of the new and specialized methods is the opinion survey. What 
the marketing survey does for a business organization, the opinion survey 
does for administrators eager for the views of the star customers of the 
government, the general public. By investigating the techniques of the 
American Institute of Public Opinion, Congress has virtually recognized 
the national importance of this type of unofficial referenda. As Dr. Gallup 
and his competitors keep in touch with broad national issues, so public 
agencies use similar polling techniques to keep informed of what the general 
public or specific groups think of their programs. The Department of Agri- 
culture, for example, has conducted elaborate scientific surveys of public 
opinion with its own specialists, not only for its own use but also for other 
departments. Many cities notably Kansas City, Missouri, and Seattle have 
made similar surveys with the help of research institutes or universities, to 
say nothing of less professional studies. In addition to these sampling sur- 
veys, nearly all government departments study the current trends in public 
opinion as reflected in newspaper and trade-journal comment. 

Advisory Committees. Most administrative policies, however, do not 
touch the public as a whole. Administrative agencies arc, therefore, usually 
more interested in the opinion of one or another special group that is prin- 
cipally affected by their programs. The formal advisory committee is one 
means of keeping in touch with such opinion. The War Production Board, 
for instance, developed an extensive system of such committees and a set 
of principles to guide their operations. The principles themselves were not 
new, for they have been followed in practice by many similar advisory com- 
mittees at all levels of government and ignored by others. In summary, 
they established a procedure by which affected private interests may be con- 
sulted by the agency, but will not be permitted to block action which is 
indicated by the public interest. The relationship between the agency and 
the affected interests, however, will not depend primarily on such procedures 
or even on the existence of formal machinery for consultation. Far more 
important will be the degree of public support for the purposes of the 
agency, the effectiveness of its organization and operations, and the cohesive- 
ness of the private interests and their willingness to cooperate with the 
government. If these conditions are favorable, a governmental agency may 
be more intimately in touch with the private interests than any advisory 
group itself could be. 

Day-by-Day Administrative Relationships. Best of all as a means of 
keeping in touch with the special opinion of affected interests are the day- 



80 DEMOCRATIC ADMINISTRATION 

by-day administrative relationships. Through consideration of large quanti- 
ties of individual cases, officials may judge not only the nature of the opin- 
ions of those affected but also their general temper. Of course, the stream of 
information between public officials and citizens should flow both ways. One 
of the most curious aspects of the attacks on "bureaucracy" in recent years 6 
has been the opposition to publicity programs or to the spending of money 
for reports to the public, as if it were improper or undesirable for a govern- 
mental agency to ask for the cooperation of the public, rather than to rely on 
sanctions. While some agencies have developed programs of persuasion, 
especially in seeking compliance with requirements newly established by 
statute, most have stressed straight information. 

Reporting to the Public. In general, the quality of purely factual report- 
ing has unquestionably improved. Cities have competed with each other 
to issue the most informative and interesting annual reports. A few states 
have followed their example, and several federal agencies prepare periodic 
reports that are encyclopedias of information for whole areas of our social 
activities. The Yearbook of the Department of Agriculture has long been 
an indispensable reference work in its field. 7 Nor is it simply a matter of 
providing information on government programs for the voter to weigh and 
analyze. Most useful and most significant of the present role of adminis- 
tration are the periodic and special reports which become the basis for 
all sorts of private activity. The weather reports, the census compilations, 
the specialized periodicals such as the Federal Reserve Bulletin, the Federal 
Home Loan Banf^ Review, Domestic Commerce publications like these 
furnish essential data for many and varied private operations. 

The daily work of the governmental press agent, often disguised by 
various more dignified terms, has its place in the total democratic process. 
He is often the closest and most frequent adviser of administrative officials 
on the general aspects of their programs. His bias is all in favor of what 
the public will like, for his success is measured by the degree of public 
approval he wins for his agency. Too often he thinks of advancing the 
personal fortunes of his boss, and too rarely does he take a long and im- 
partial view of the administrative program. But his shortcomings are to 
some degree corrected by the independence of newspaper reporters and 
editors. His general influence on administration is surely on the side of 
adjusting it to the taste of the public. 

Commissions of Inquiry. Advisory committees and public reporting have 
their influence on departmental policies. Even more important is the effect 
on national policy of programs developed by special advisory groups, in- 

6 Sec above Ch. 3, "Bureaucracy Fact and Fiction." 

7 A reader interested in the general philosophy of an editor of government reports who 
combines an understanding of general public affairs with an appreciation of scientific techniques 
and rarest of all a literary style should read the volume of essays by the editor of the 
Agriculture Yearbook: Hambidge, Gove, The Prime of Life, New York: Doublcday Doran, 
1942. 



DEMOCRATIC ADMINISTRATION 81 

eluding both public officials and private citizens. Such programs have no 
mandatory effect, but the influence of painstaking research and thoughtful 
recommendations may be tremendous in the long run. Anyone who reads 
the reports of President Hoover's Committee on Recent Social Trends and 
of his Commission on Home Building and Home Ownership will discover 
in them the outlines of the subsequent decade's national policy on social 
welfare and housing. Our current policies are still being influenced by the 
reports of the National Resources Planning Board, which brought together 
natural and social scientists and leading administrators from private and 
public life to draft national programs. And as World War II came to an 
end, we were brought face to face with a new program outlined in 
Science: The Endless Frontier, a report prepared by Dr. Vannevar Bush 
as director of the Office of Scientific Research and Development, who under- 
took this task at the direction of the President and with the help of com- 
mittees including the leading scientists and educators of the country. 

The basic changes in our national policy are rarely the invention of 
either legislators or administrators working alone. They reauire the con- 
sensus of interested men and women of special knowledge and the sup- 
port of private organizations, as well as the agreement of officials, the 
promotion of popular understanding through press and radio, and the 
sanction of elected representatives. 

3. PUBLIC PARTICIPATION 

Cooperative Government. It is hard to talk realistically about govern- 
ment as long as we think of it as something apart from ourselves. A govern- 
mental program does not exist for its own sake, but as a part of a larger 
purpose tied into the social order. This must be remembered when we 
hear government described as something equivalent to coercion. As a sam- 
ple of this type of thinking, we may recall that the National Association of 
Manufacturers proclaimed at its 1944 convention that: 

Government, in order to be a government, must, in the final analysis, 
depend on the legal use of force, and by its very nature must make this 
force the basis of its dealings with the private citizen. Under any form 
of government-dictated economy this means the intrusion of the irresist- 
ible force of government into the everyday affairs of life. These intru- 
sions must be accomplished by those in the employ of the government. 
Such is political bureaucracy, and therein lie the seeds of tyranny. 8 

As a general picture of public administration, this statement needs to 
be revised with a touch of realism. Force wielded by government employees, 
intruding into the everyday life of the citizen to deliver his mail, to relieve 
him of his garbage, to teach his children, to keep him from driving on the 
wrong side of the road are these "intrusions"? And it may also be asked 

s As reported in the New York Times. Dec. 8, 1944. 



82 DEMOCRATIC ADMINISTRATION 

whether private corporations themselves, and their property, do not need 
to be protected and supported by force wielded by government employees. 
It is at variance with fact to see public administration as the employment 
of force against citizens. Nor does it make sense to think of it as being 
controlled solely or even primarily by government employees. 

When we judge the political character of public administration and be- 
fore we decide that it is either dictatorially oppressive or enervatingly pater- 
nalistic we should remind ourselves that nearly every main function of 
government is now administered by cooperation among levels of govern- 
ment or between public and quasi-public or private agencies. Not only has 
the public become the star customer of government, but business, labor, 
and a host of organized group activities have all been rolled into one com- 
plex cooperative system. In this system the traditional values of liberty have 
not been lost. Yet a higher degree of teamwork or harmony has been 
attained than would ever be achieved through a coercive approach. 

In general, the system that for want of a better name has sometimes 
been called "cooperative government" is one in which a broad program is 
carried out, not by a single national agency such as the Post Office Depart- 
ment, but by federal, state and local agencies working in cooperation with 
each other, with quasi-governmental or private institutions, with business 
and labor. For its greatest efficiency, cooperative government requires a 
high degree of mutual trust and common understanding, harmonious action 
by several or perhaps even thousands of legislative bodies, and considerable 
voluntary support from private individuals or institutions. 

Combined Operations Among Levels of Government. One of its aspects 
is the cooperation of federal, state, and local agencies in almost all the 
important programs of government, 9 whether in education, social security, 
agriculture, public health, the regulation of commerce, 10 housing, highways, 
public works, or any other fields. Rather than list the programs in which 
intergovernmental cooperation is essential, it would be better to challenge 
the reader to name an important one in which it is not. He may start with 
the business of the post office, but he will be hard put to it to find another. 
He had better not mention national defense, usually considered a predomi- 
nantly federal function, until he has studied the influence of the state militia 
and the National Guard on our military history, and the way in which the 
National Guard is formally a part of the structure of the War Department. 
And as national defense becomes more and more a matter of technological 
and industrial power, it is significant that the most basic scientific research 
for national defense in World War II was conducted by private institutions 



9 Bane, Frank, "Cooperative Government in Wartime," Public Administration Review, 
1942. Vol. 2, p. 95 ff. 

10 The degree of cooperation in this field is rarely appreciated. Cf. Bosworth, Karl A., "Fed- 
eral-State Administrative Relations in the Regulation of Public Service Enterprises," American 
Political Science Renew, 1942, Vol. 36, p. 21*5 ff. 



DEMOCRATIC ADMINISTRATION 85 

academic and industrial research laboratories. These appeared better able 
to develop new secret weapons because they had an independent status and 
thus greater leeway in approach, even though they were working within 
the framework of governmental policy. 11 

The system of cooperative government was greatly expanded during 
World War II. Never before had governmental operations and planning 
been so decentralized in the United States as at the time when their pur- 
pose became utterly concentrated and their potential authority great beyond 
any peacetime precedent. The Selective Service System turned over to local 
boards of volunteers, set up by state agencies, the task of manning the armed 
forces. Much the same policy was followed by our price and rationing 
administration. And there are other examples. If the Office of Civilian 
Defense was no conspicuous success at the national level, the civilian de- 
fense councils in many states and thousands of communities served as vital 
nuclei for tying together at a lower level, and modifying in the light of 
local circumstances, the many national programs of civilian war activity. 
Anyone who thinks of the war program as something dictated from Wash- 
ington may study the war activities of the Council of State Governments, 
the American Municipal Association, and the United States Conference of 
Mayors. State and local governments not only had to carry out national 
programs in many obvious and some unexpected ways, 12 but they were often 
ahead of federal agencies in realizing and pointing to the need for new 
policies. 

Although state and local governments still use the jargon of states' rights 
and local autonomy, in practice they know that they cannot live in inde- 
pendence. They must work with federal agencies and influence federal 
activities in order to justify their existence. A system in which local gov- 
ernments with their own legislative bodies carry out national programs 
under the guidance of federal agencies has one highly important general 
advantage both political and administrative over a completely national 
system. The man doing the job in the service of the locality has reason to 
feel a general responsibility to the public, not merely a specialized one for 
a particular branch of administration to a distant superior. To be specific, 
the city manager whose welfare department is carrying out a function on 



11 For an appreciation of the part that state military organizations play in Army affairs, 
see Palmer, Brig. Gen. John McAuley, America at Arms, Washington: Infantry Journal Press, 
1943. Still more relevant to modern warfare is the story of the development of the atomic 
bomb, radar, the proximity fuse, and other new weapons. See Smyth, Henry DeWolf, Atomic 
Energy for Military Purposes: The Official Report on the Development of the Atomic Bomb 
under the Auspices of the United States Government, 1940-1945, Princeton: Princeton Uni- 
versity Press, 1945. See also two forthcoming books on the Office of Scientific Research and 
Development: Baxter, James Phinney, Scientists Against Time, and Stewart, Irvin, Organizing 
Scientific Research for War, both to be published by Little, Brown & Co. 

12 For example, the provision of emergency war housing required the amendment of city 
building codes, and the national fiscal policy depended partly on cooperative state and local 
taxing and spending programs. 



84 DEMOCRATIC ADMINISTRATION 

behalf of federal and state agencies is freer to have an independent opinion, 
and to express it to the head of the national program, than if he were a 
local employee of a national agency. To carry out the function he must 
keep his legislative body informed, and its members in turn may educate 
their constituents. While doing the job he can keep it from colliding with 
programs of other federal agencies, or v/ith state or local activities. In brief, 
the cooperative system gives the man at the level of local government a 
better chance to weave together the many strands of national policy than 
does a system in which every function has its own special functionaries 
from the top level all down the line. 

One particularly good example, though in some ways it is unique, is 
the scheme of agricultural administration. It has been influenced by concen- 
trated economic forces to a lesser degree than have comparable activities 
in the fields of commerce and industry. As a result, the traditional American 
individualist, the farmer, has retained wider opportunities for direct par- 
ticipation in cooperative government. He has taken part in the develop- 
ment of an intricate cooperative system of public subsidy, joint marketing, 
production control, soil conservation, public credit, freely available scientific 
research, and technical education in state universities, extension courses, and 
on the farm. From the administrative point of view, this area is especially 
interesting because it illustrates so well how some functions can best be 
handled by national agencies, especially if they deal with broad economic 
problems like farm credit or aid to underprivileged groups like the program 
of the Farm Security Administration; how other functions are best en- 
trusted to state agriculture departments; others to land-grant colleges; and 
still others to the joint efforts of experiment stations and extension services, 
in which the county agent works at one and the same time for all levels of 
government and for private associations of farmers and on the side helps 
carry on incidental programs of welfare and education. 13 

Benefits of Intergovernmental Collaboration. To see the benefits of a 
cooperative system it is not necessary to believe that local government is 
closer to the people, or more important to the people, or more democratic, 
than national government. None of the traditional local functions deals 
with as many people every day as does the postal service; none of them 
affects the lives of citizens in ways as important as do international diplo- 
macy and war. And all functions exercised by state and local governments 
are more likely to fall under the control of irresponsible groups, whether 
wardheelers or powerful economic interests, than is the case in the federal 
government. Moreover, the business of the nation commands the citizen's 
first attention. The newspaper editor knows what people are interested in 

13 For comments on the type of functions that are administered by one level of govern- 
ment alone and those that are managed cooperatively, see Benson, George C. S., The New 
Centralization, New York: Farrar & Rinehart, 1941. See also Baker, Gladys, The County 
4gent, Chicago: University of Chicago Press, 1939. 



DEMOCRATIC ADMINISTRATION 85 

when he puts Washington affairs on the front page, and local council news, 
if any, inside with the hair-tonic ads. 

Yet there is a great deal to be said for arrangements under which public 
officials with a national point of view have to deal on a basis of mutual 
respect with public officials representing a local point of view. Quite a few 
broad governmental programs may well be divided into specific functions, 
some under exclusive federal or local control and others under mixed con- 
trol, but with representatives of all levels of government in a position to 
criticize independently the arrangements, and to speak up if they are dis- 
regarded. Even if the federal government is the exclusive source of funds 
or has the final word in any dispute, the participation of local agencies may 
be a source of initiative, of independent criticism, and of administrative 
personnel who have been trained in the exercise of political responsibility 
rather than as anonymous components of a larger organization. 

Inclusion of Business and Labor. It is interesting to note, moreover, 
how the cooperative system has been extending itself, not only to local 
governments and public institutions, but to business corporations that are 
sometimes thought to be motivated only by their balance sheets. Perhaps 
the general drift toward the view that private property, too, is a public trust 
is partly responsible. And perhaps the way in which the management of 
business has become largely separated from ownership has opened the road 
to cooperation with the government. 

This is not to suggest that business interests are sacrificing themselves 
out of public spirit. It is only to say that they now see their place in a 
larger system more clearly than was the case half a century ago. They have 
been drawn into the administration of national programs by the legislation 
that they have sponsored, by regulations imposed on them, by contractual 
arrangements with public authorities, and through the activities of their 
trade associations. For example, in World War I, the federal government 
took over the railroads. In World War II, the Office of Defense Trans- 
portation established general policies, and the Association of American 
Railroads served as the go-between with the individual railways both on 
the formation of these policies and their execution. That individual rail- 
way cars are moved about the country according to orders from a national 
center in compliance with general governmental policies is not socialism, but 
something that would never have been recognized by Adam Smith. 

Property, as the lawyers say, is only a bundle of rights. Legislators and 
administrators, unlike doctrinaire socialists, have followed the advice of 
Aesop by dealing with each right separately, so that the national interest 
in the use of property may find expression while private interest is not 
destroyed. There is indeed no general principle about government-business 
relations that is uniformly binding. Like state and local governments, 
business enterprise has to justify its existence by its usefulness in the public 
interest. It would not do to expect too much of such a general responsi- 



86 DEMOCRATIC ADMINISTRATION 

bility by itself, but it is probable that government-business relations will 
be worked out according to specific and empirical standards, field by field. 

As business corporations come into the picture, so do labor unions. In 
World War I, the Navy manned merchant vessels that carried supplies and 
munitions to France. In World War II, while the ships were being oper- 
ated by private companies for the War Shipping Administration under a 
variety of contractual arrangements, they were manned by civilians whom 
seamen's unions referred to the companies. Much of the function of pro- 
tecting seamen that was assigned in the late nineteenth century to a gov- 
ernment agency the Bureau of Navigation has now been taken over by 
union delegates. 

Group Initiative Under National Standards. The modern tendency is 
for the federal government to see to it that private organizations or state 
and local governments do certain things according to certain standards, 
instead of doing them itself. The Civil Aeronautics Administration, for 
instance, licenses private flying schools and private repair shops to examine 
the pilots and inspect the maintenance of aircraft functions comparable 
to those which the early Steamboat Inspection Service assigned to its in- 
spectors. Thus an agency empowered to establish its own regulations, 
instead of being bound by detailed legislation, is apt to discover that admin- 
istrative effectiveness dictates the same policy as does the desire to leave 
private enterprise independent of detailed government control, subject to 
standards established in the public interest. 

In all these cooperative arrangements, private associations play an es- 
sential part. De Tocqueville remarked a century ago that the leadership 
in public affairs which would be assumed by a public functionary in France 
or a grand gentleman in England was taken in America by a private as- 
sociation. 14 Some of these are organizations of people bound together only 
by public spirit and civic interest in a single subject; some, like trade and 
professional associations or organizations of public officials, are bound 
together by a common occupational interest. 

It must not be imagined that such a system always works toward the 
public welfare. It has the disadvantage of diffusing responsibility and 
encouraging various groups to blame their own shortcomings on each 
other. In some cities, for example, the price of decent housing is outrage- 
ously high because real estate men, dealers in construction materials, con- 
tractors, labor, and local government all work closely together to force the 
consumer to pay more than he should. 15 

To keep the mai^ lines of policy in the hands of responsible public of- 

14 Democracy in Amrrica, Vol. 2, p. 106, New York: Knopf, 1945. 

18 Temporary National Economic Committee, Investigation of Concentration of Economic 
Power, Monograph No. 8, Toward More Housing, Washington: Government Printing Office, 
1940. Other monographs of this committee illustrate the dangers of private exercise of what 
amounts to governmental power in other economic fields. 



DEMOCRATIC ADMINISTOATION 87 

facials is essential if a governmental program is to be democratically ad* 
ministered. To let local agencies use national funds for purposes other 
than those determined by responsible national authorities, or to leave to a 
private interest the responsibility of regulating itself, cannot be justified 
on any grounds of democratic decentralization. However, the existence of 
many organizations which command the loyalties of citizens is the best 
guarantee that no single agency can demand and abuse that loyalty. The 
people may safely call on their governmental executives for vigorous leader- 
ship as long as they have many channels through which to contribute to the 
development of policies and to protest those that seem to be determined 
by self-interest or professional prejudice. 

4. REPRESENTING THE PUBLIC INTEREST 

Interdependence of Public and Private Interests. The system of mixed 
governmental and private effort has not solved all our political and ad- 
ministrative problems; sometimes it may seem that it has only complicated 
them. In politics, it has made the old issues of left wing versus right wing, 
government ownership versus private enterprise, appear unrealistic. In 
administration, it has added so many dimensions to the functions and re- 
sponsibilities of public management that the negative formulas of the nine- 
teenth century have been rendered inadequate. The problem is no longer 
simply how to prevent special privilege; it is one of organizing the larger 
public interest. 

The most conspicuous kind of nineteenth-century privilege party 
spoils is fast becoming obsolete. The new problem is more subtle than 
the prevention of patronage in jobs or contracts. It is to keep the system 
of cooperative government from freezing into a structure of guilds or com- 
peting pressure groups. The distinction is not mainly one of form or 
pattern, but of purpose and attitude. We cannot solve the problem by 
saying that government must not aid private interests, for the interests of 
private organizations and governmental agencies are so thoroughly inter- 
twined that many of the distinctions between them have become only 
incidental. 

World War II extended the interdependence of private and public 
interests. Private enterprise was often conducted in plants built by a gov- 
ernmental corporation, with raw materials assigned by priorities, with 
labor provided by the United States Employment Service, with expenses 
covered by cost-plus-fee contracts or profits restricted by renegotiation, and 
perhaps in communities built by public housing agencies. But this is 
nothing fundamentally new in America. It is as old as the land grants to 
railroads and homesteaders, as Henry Clay's "American system" of tariffs 
and internal improvements, and as the subsidized and chartered private 
companies that established most of the thirteen colonies in the New World 



88 DEMOCRATIC ADMINISTRATION 

while the other Americas were being developed by alliances of military and 
ecclesiastic hierarchies. 

Threefold Collaboration in Policy-Making. Today we see most national 
policies which govern the larger private interests as well as purely govern- 
mental business worked out in three-fold collaboration, with participation 
by congressional committees, by administrative officials, and by represen- 
tatives of private interest groups. 

It is clearly essential to democratic government that the legislature be free 
to consider and reject the proposals of administrative officials and of pressure 
groups, and that it give no particular official or private interest an exclusive 
right to be heard. Yet the "bureaucrats" and the "lobbyists" have a vital 
role in the formulation of policy, for they shape up the smaller questions 
into large issues capable of legislative consideration. Congress would be 
faced with chaotic conditions if, for instance, it insisted on reading petitions 
from individual businessmen instead of hearing the testimony of trade- 
association executives. 

To develop a program in democratic fashion, it is indispensable to ex- 
amine present administrative experience, study the probable effect of new 
proposals on all interests concerned and on related programs, and then 
subject the proposals to legislative hearing and debate. While the repre- 
sentative of the special-interest group plays a necessary part in this process, 
the public administrator has much the same special knowledge and a 
broader kind of responsibility. His role in the formulation of policy for 
final legislative consideration, amendment, and approval or rejection is 
and should be an influential one. It is accepted as such whenever any group, 
in or out of the legislature, tries to work out a practical program. Heated 
denunciation of the influence of bureaucrats on legislation is usually only 
a tactical maneuver in the battle over policy. 

The administrative official has several assets that make it in accordance 
with the public interest for him to exert great influence in the evolution of 
policy. He may develop imoartial scientific and professional standards 
for the measurement of the effect of policies. He may judge the working 
of those policies by close observation in actual practice. His enthusiasm 
for theories is likely to be tempered by a shrewd appreciation of what is 
possible and practical and what is not. And yet he can be the spokesman of 
interests that are not cohesive or powerful enough to hire press agents or 
influence legislators by closely reasoned arguments. This function is espe- 
cially important since consumers being equivalent to the general citizenry 
rely mainly on their government to protect their interests against the 
powerful lobbies of producers and salesmen. 

AH the advantages that the administrative official possesses in the formu- 
lation of policy are reflections of the responsibility of his position. It is his 
task to further the purposes defined by law and executive order, which are 
a part of a general program supported by the dectorate. He is directly 



DEMOCRATIC ADMINISTRATION 89 

accountable to his superiors, and indirectly to the legislature, whost* control 
over appropriations is a powerful weapon for the enforcement of responsi- 
bility. His professional bias and his governmental responsibility alike impel 
him to work for the public interest. In practice, his influence is considerable. 
Careful studies of the origins of legislation of the sources of the drafts of 
bills acted on by the legislature show that in federal and state governments 
alike the administrative official is accepted as the ghost writer of the 
lawmaker. 10 

Informality of Policy-Making Process. On the other hand, no matter 
how much of scientific methods or objective standards is applied in the 
development of a policy, a public official is subject to the error of overempha- 
sizing his own specialty. The more zeal he shows for the public welfare, 
the greater is the probability of error. This kind of distortion is increased 
by the tendency of the official to ally himself with legislators who have 
similar preferences and with interest representatives holding a similar 
point of view. 

Such informal alliances to further the public interest by advancing spe- 
cial programs make it impossible to determine exactly who was responsible 
for what. The effective responsibility for the content of public policy can- 
not be measured simply in the number of bills that are prepared by lobby- 
ists, by administrative officials, or by individual legislators. For the more 
important decisions in the formulation of policy are usually made in informal 
discussions in which those concerned try to work out an agreement before 
the proposal is formally prepared for legislative consideration. 

Even if no informal discussions are held, a proposal drafted by an ad- 
ministrative official will be influenced greatly by his judgment of what the 
legislative committee will probably accept and of what will arouse strong 
opposition by private interests. It should, therefore, be stressed that the very 
fluidity and informality of this process is its most democratic characteristic. 
The legislature and the chief executive are enabled, if they consider it in the 
general public interest, to refuse to accept the organized point of view of 
the interest group or the administrative department, and to try through other 
combinations of private interests and public administrators to line up a 
workable new program. 

For while government departments and organized private interests are 
basic machinery in our social system, they can be positive forces in a democ- 
racy only if they are kept in line with the general public interest. It is not 
enough for them to refrain from encroaching on the rights of others; they 
must actively contribute to the general welfare. To enforce this fundamen- 
tal responsibility it is necessary to prevent any single collection of interests 
whether a government department, a trade association, a labor union, or 



16 Witte, Edwin E., "Administrative Agencies and Statute Lawmaking," Public Adminis- 
tration Review, 1942, Vol. 2, p. 116 ff.; Scott, Elisabeth M. and Zeller, Belle, "State Agencies 
and Lawmaking,** ibid., p. 205 ff. 



90 DEMOCRATIC ADMINISTRATION 

what not from monopolizing an activity so completely that it can deal with 
the people and their government on its own terms. 

Experimental Approach. For this reason it may sometimes be politi- 
cally wise not to consolidate major bureaus or departments even though 
they have related functions, especially if they are pursuing different experi- 
mental approaches to a problem and if their consolidation would result in 
dropping such productive experimentation. Thus a two-party system is bet- 
ter than a one-party system, not because the two parties have different 
philosophies, but because each helps prevent the other from subordinating 
the general welfare to its prejudices and interests. Similarly, at the top level 
of administration where broad political considerations are properly involved, 
it may sometimes be desirable to avoid a neat pattern which puts all related 
functions under the same agency, in order to give the chief executive more 
freedom of choice in the future. 

For example, in the middle 1930's the field of housing was divided into 
sharply defined groups, each with its own solution to the housing problem. 
The real-estate boards, the building and loan associations, the commercial 
banks, the lumber dealers, the welfare workers, the advocates of decentral- 
ized subsistence homesteads, the advocates of slum clearance each of these 
private groups was sure that its solution alone was right, each identified it 
with its own philosophy, each lined up in support of an administrative 
agency dedicated to something like its approach, each cultivated the Con- 
gressmen whose committees were likely sources of support. To amalgamate 
the various administrative agencies in the field of housing at that stage 
would have been to commit the country to a partial approach. After eight 
or ten years of enlightening experimentation, however, all groups were much 
better prepared to admit the possibility of making the several programs 
operate in harmony rather than in opposition to each other. It was then 
feasible to bring the several administrative establishments into a single Na- 
tional Housing Agency, each retaining a measure of its independence and 
each fitting itself into a comprehensive program. 

General Interest Over Special Interest. The program of a government is 
never merely the sum of its departmental programs; it may be either much 
more or much less. It is much less if the basic purposes of the departments 
are inconsistent. It is much more if their operations are linked together, each 
furthering the activities of the others and all submerging their jurisdictional 
disputes in a general current of agreement. 

But the legislature alone cannot accomplish such administrative coordina- 
tion. The democratic process of subordinating the special interest to the 
general interest depends to a high degree on the leadership of the chief 
executive in the sponsorship and application of policy. No one is in a better 
position to observe how present developments will require changes in policy. 
No one else can as effectively use the agencies of centralized management 
budgeting, planning, personnel to guide the preparation of policy as well 



DEMOCRATIC ADMINISTRATION 91 

as its execution. No one else can equally well back up his formal orders 
to the executive establishment with administrative sanctions. 

The broader the responsibility of an administrator, the more concerned 
he must be with the general aspects of the government's program, and the 
less with narrow questions of technical efficiency. The specialist in manage- 
ment efficiency or scientific research who resents "political" interference 
from above may be properly objecting to partisan exploitation of his job. 
It is just as likely, however, that he resents having the technical aspects of 
his work adjusted to fit a general program. Similarly, the bureau chief 
naturally dislikes having his aims subordinated to those of the department, 
and in turn the department head may seek to be as independent as possible 
of the chief executive. 

It is plain that the adjustment of each level's work to make it fit into a 
larger pattern is the essential process in administration. As long as this 
process is carried on in an atmosphere of free criticism, and with the chief 
executive responsible to the people, it is a truly democratic process. The 
higher the level at which an administrative official operates and the broader 
his responsibilities, the closer he is to direct accountability to the people. 
The formal machinery is not as important as the fact that the chief executive 
is held responsible by the public for the whole program of the government. 
His direct responsibility to the people is strong in the American democratic 
tradition. Let us remember that the Electoral College was reduced to a fic- 
tion soon after it had been established, and that in many a city the voters 
have chosen council members for their support of the city manager rather 
than for their own views or personalities. 

The chief executive is most effective in contributing to the democratic 
workings of administration if he combines with his machinery of coordi- 
nation a policy or a philosophy that will stir the interest and inspire the 
support of his departments, the legislative body, and the general public alike. 
Without such a common purpose, the cooperation of free institutions is 
transformed into the selfish defense of vested interests. With it, such cooper- 
ation multiplies the effectiveness of governmental administration, adding to 
the efforts of each single public agency the energies that are developed in the 
varied organisms of a free people. 

5. DEPARTMENTAL DEMOCRACY 

Individual Freedom Versus Institutional Restraint. If the purpose of 
democracy is to make government serve the highest ends of man, instead 
of making man serve the lowest ends of government, we cannot be sure 
that public administration will remain democratic in the long run simply 
by achieving satisfactory working relations between governmental agencies, 
the legislature, and the general public. We must consider the way these 
agencies are organized and operated, for it is always possible for an organi- 
zation to defeat its own ends by becoming an end in itself. 



92 DEMOCRATIC ADMINISTRATION 

Within an organization, democracy is by no means the same thing as 
lack of discipline or authority. An army, for example, can be quite demo- 
cratic even though an officer has authority to order his men to certain death. 
The question is whether the administrative organization permits its mem- 
bers to retain their independence as citizens in matters that do not concern 
their official duties, and whether it gives them a chance, in performing 
those duties, to make full use of their talents to further the general welfare. 

Public officials and employees do not need to surrender their personal 
rights or liberties as citizens. Perhaps the low point of public confidence in 
government, at least in the English-language tradition, was reached for a 
few years in the late eighteenth century when the British Parliament denied 
civil servants the right to vote. That limitation was soon removed, but Great 
Britain continued to restrict the political activities of civil servants more 
severely than did the United States. America made the opposite error of 
letting political parties use government employees for their own purposes, 
until civil service rules established the proposition that a public servant 
must not campaign in electoral contests for or against the chief executive 
or members of the legislature. 

It would probably be an error for this nation to adopt, after the British 
fashion, the general principle that civil servants may not take part in or- 
ganizing the promotion of public policy. There are features of the British 
Constitution that justified that principle, and may still justify it. The per- 
manent tenure of the civil servant, and the possibility of change at any time 
in the political direction of public administration, might make it inconvenient 
to permit him to take a public stand on an issue between his present 
superiors and their rivals who could become his superiors tomorrow. Even so, 
it is a little hard to see why it is proper for civil servants to organize to get 
their salaries raised and improper for them to take part in more inclusive 
organizations in support of other policies. 

At one extreme there must obviously be some limitation; at the 
other extreme there need be none. An officer in a high position should not 
publicly oppose his political superior's policy without resigning; and if he 
does oppose it in public, he should be discharged. At the other extreme, 
an employee with duties totally unrelated to policy ought to be and gen- 
erally is permitted to take any stand he likes on issues of policy. 

The most difficult problems arise between these two extremes. An offi- 
cial with a long-range interest in the public service will often find com- 
promise necessary. As long as he is conscious of working toward his general 
objective as a servant of the public, compromise is simply a function of his 
position. Government, of course, needs men whose primary interest and 
competence are focused in the administrative process itself, and who can 
help conduct administrative affairs regardless of chanees in polirv. How- 
ever, in a dynamic democracy there is also room for men who, while 
not active in electoral campaigns or party organizations, are primarily inter- 



DEMOCRATIC ADMINISTRATION 93 

csted in policies and programs, and are quite willing to work for these 
either inside or outside the government. 

Now that the number of civil servants is so great, it is especially impor- 
tant to safeguard their political rights. As long as we keep our system of 
cooperative government, we will never be threatened by a gigantic bu- 
reaucracy all of whose members vote for its boss. The cooperation of state 
and local governments and private institutions in national administration 
helps guarantee the freedom and diversity of political views, just as it 
keeps our citizens from being divided sharply into two parties, each differ- 
ing from the other in political philosophy and in attitudes on all major 
issues. 

Sense of General Purpose. At the same time, administrators themselves 
ought to be concerned with the political implications of their own depart- 
ments and the departmental working processes. The purpose of every 
organization is partially defeated whenever it tends to become absorbed in 
itself and in the interests of its personnel, rather than in the accomplish- 
ment of its general objectives. The administrator ought not to be blind to the 
dangers of such introversion, for it is a fault from which none of his man- 
agement formulas can save him. 

There is, first of all, one obvious danger. Any person may easily slide 
into the error of believing that his organization exists primarily for him 
and for his particular category of associates. This is a matter of degree. 
In general, the more the civic status of public employees is preserved, 
the less incentive they have for considering their pay and working condi- 
tions their prime objectives. It is quite proper to demand the protection 
of employee rights and to organize to that end. It is also quite proper to 
take an interest in the development of a career service, based on adequate 
personal incentives. At the same time, neither the citizen nor the civil 
servant ought to confuse the security or conditions of government employ- 
ment with the essential purposes of public administration. 

The distinction is not always simple, but there are several approaches 
which will help an agency head to make it clearer. One is to see that em- 
ployees have full opportunity to use their abilities in the most effective ways. 
No single organization can do so completely, for the purpose of the organi- 
zation itself is a limitation. A welfare agency, for example, could hardlv 
make the best use of a promising physicist. Within reasonable limits, how- 
ever, intelligent methods of recruiting and classifying employees and of 
assigning them work that will suit and develop their talents are apt to 
further at once the efficiency and the democracy of administration. Large 
organizations can do even more by adopting programs of in-service training 
to encourage the fullest growth and use of all potential abilities. Nothing 
weakens an administrative organization or a government as a whole more 
seriously than artificial barriers to the advancement of men and women 
with capacity and leadership. The traditional practice of American civil 



94 DEMOCRATIC ADMINISTRATION 

service commissions of considering only the immediate usefulness of a 
recruit, and making little or no effort to discover and develop general admin- 
istrative ability at an early stage, cannot be justified on grounds of democ- 
racy; it is merely shortsighted. It is possible to develop administrators with- 
out having an exclusive and undemocratic administrative class. 17 

In encouraging employees to put forth their best efforts, a great deal 
depends on indefinable matters of personality and atmosphere. It may not 
be too fanciful to suggest, however, that the qualities which enable a citi- 
zen to assert his political independence while respecting the opinions and 
personalities of others are similar to those which aid the administrator to 
bring out the best efforts of his subordinates. The dictatorial administrator 
who makes personal issues out of differences of judgment is likely to stifle 
the advice on which he must rely for guidance. On the other hand, one 
unduly preoccupied with the personalities of his subordinates one who 
fails to bring to their attention the points on which they fall below his stand- 
ards, and who juggles his organization to suit their peculiarities may 
merely find the more scrupulous to be confused and uncertain, and the 
less scrupulous to be either scheming for their own purposes or challenging 
his leadership. A good measure of intelligent extroversion, combined with 
a sensitivity for the rights and feelings of others, will help the administrator 
to keep his agency's attention on the job to be done rather than on its 
internal problems. 

Vice of Departmentalism. A second danger is the assumption that the 
organization exists for its own sake. The logical transition here is easy: 
esprit de corps makes for effective work, and esprit de corps is furthered 
by expansion of the functions or jurisdiction of the organization. In mild 
doses this is good medicine, but as a steady diet it is politically fatal. Undue 
concentration of loyalty in the agency is somewhat akin to the specialist's 
devotion to his own specialty. The formula of having the expert "on tap 
but not on top" is easier to quote than to apply in practice. 

Several cures have been tried for this ailment. One is to introduce 
countcrinfluences in the form of government-wide concerns agencies to 
aid the chief executive in his widely embracing managerial duties, such as 
a planning office or a budget bureau, or special coordinating machinery. 
Another is to give multiple functions to a single agency or a single unit 
of government. On this principle the Tennessee Valley Authority was 
created; much earlier the entire system of British local government was 
reorganized on the same principle to substitute a single unit of government 
in each area for a number of specialized authorities. Still another cure is 
the systematic promotion or transfer of administrative personnel from one 
department to another. The British civil service adopted this idea for the 
higher levels of the administrative class more than two decades ago. Such 

17 Cf. above Ch. 2, "The Study of Public Administration," sec. 3, "Training for Public 
Administration.*' 



DEMOCRATIC ADMINISTRATION 95 

transfers have probably done much to make civil servants think more of 
the general welfare and less of jurisdictional disputes. 

If transfers of this kind are good between departments, why not apply 
them between the various levels of government and between government 
and private institutions? Government is only one department in the whole 
organization of society, and the changes in its functions during the past 
century have made the line between it and private activities far less sharp. 
Today, the top governmental administrator cannot adequately judge his 
agency's operations merely by the conventional standards of management; 
he must consider its effects on society as a whole. To give him the necessary 
breadth of view, we may need a wider interchange of top personnel among 
levels of government and between public and private life. The specialists 
in techniques and in various subject-matter fields are necessary, and will 
want to make life careers of their work. However, they are not likely to 
develop the breadth of sympathy and imagination that an administrator 
of the highest level must have if he is to do his job in the development as 
well as in the execution of policy. 

The spoils system was little better than looting the public treasury. But 
the theory of rotation in office is not the same as that of partisan spoils. In 
a general sense it has always applied in American life, private as well as 
public. Visitors from more static or more stable societies invariably wonder 
at the American's tendency to change from job to job, or to occupy several 
jobs at once. Perhaps we should rediscover or bring up to date the theory 
that Jefferson and Jackson held about public office. It is not that public ad- 
ministration is so simple a matter that anyone can master it in a short time. 
On the contrary, it is so complex that few can comprehend the problems 
that arise at its higher levels without having had wider experience, and 
not in government alone. 18 

Inroads of Perfectionism. A third trap awaits the administrator who 
seeks to do the job assigned to him by law and executive direction. It is 
the danger that the administrative process will become an object in itself, 
that the very art of generalization will be converted into a specialty. Some 
managers allow their personal analytical and critical processes to absorb their 
attention. As a result, they fail to let subordinates do their jobs in their 
own ways, thus obstructing the development of diverse abilities and the 
release of individual energies throughout the organization. Others become 
hypnotized by the procedures of management. A manual of procedures has 
its uses, but like other written rules it is apt to turn sterile unless it is the 
elaboration of a common will, a real agreement of minds within the or^ani- 
zation on objectives and on the type of teamwork by which they are to be 
effected. 



is Of course, this proposition is quite different from the historic use* of rotation in office 
for patronage purposes; cf. above Ch. 1, "The Growth of Public Administration," sec. 4, "In- 
creasing Competence for Increasing Responsibility." 



96 DEMOCRATIC ADMINISTRATION 

Delegation depends on the assumption that some other man can do the 
job as well as the delegating superior, once the proper general directions 
are established. The popular axiom, "If you want a job well done, do it 
yourself," is the opposite cf administration. Yet a kind of perfectionism 
sometimes creeps into management. It is shown by a preference for making 
all decisions at headquarters rather than leaving some of them to the field; 
headquarters will make no mistakes, even if a bottleneck develops. It is 
shown by a preference for flooding the field with detailed instructions; it is 
best to make sure that all is settled in terms of the letter of the directives. 
It is shown by a preference for centralized national administration in all 
circumstances; it is better to have a uniform policy and no local variations, 
even if the program fails to win general understanding and acceptance. 

Yet these perfectionist assumptions usually break down because the very 
nature of public affairs requires their administration with flexibility and 
initiative on lower levels. It is, therefore, just as desirable to get the views 
of the men in the field as the views of the department head. In a quite literal 
sense, headquarters must serve the field officers and the field officers must 
serve the public if the organization is to be democratically efficient in its 
administration. 

Democratic Self -Education. The purposes of democratic society deserve 
the best administration that can be had. No less will do the job. And the 
administrator who today is doing his best hardly need worry about the stale 
charges of czarism and dictatorship that are now being taken up by scholars, 
after decades of careless use by political hacks. On the contrary, he should 
be heartened by the way in which the administrative process has broadened 
and become more democratic during the past generation, even during the 
war years when concentration of authority might have provided an excuse 
for more authoritarian policies. 

This broadening of participation in our national administration must not 
be credited to any single group or party. It is the result of a gradual 
strengthening of local and group responsibilities throughout the nation, and 
of a freer exchange of ideas and personnel among all levels of government 
and private organizations, including business corporations. In its more 
successful programs, contemporary government makes it plain to the citi- 
zen that while the best administration is certainly democratic, the most 
democratic administration is also the most efficient. 

In order to provide a cohesive force for this cooperative system, we 
should encourage among our administrative officials active and responsible 
participation in the development of policy. 19 The old proposition that policy 



19 To be sure, no one would want to minimize the basic distinction between responsible 
and irresponsible participation in policy development. Some of the standards of responsibility 
in this sphere have been outlined in the present chapter. Others are suggested above in Ch. 1, 
"The Growth of Public Administration," sec 1, "Administration Public and Private," and 
Ch. 3, "Bureaucracy Fact and Fiction," sec. 1. "Semantics and Realities." 



DEMOCRATIC ADMINISTRATION 97 

and administration are mutually exclusive spheres of activity never fully 
applied anywhere. Particularly, it never fitted the United States. And 
today, when the political fate of the world depends on our ability to coordi- 
nate technologies while encouraging initiative, it is necessary for administra- 
tive officials to help in the charting of our social policies, even though they 
must remain fully responsible to legislative control and to direction by 
democratically chosen executives. 

The dynamics of our democracy cannot be a simple process of right 
pulling against left; it must rather be a process of organizing both public 
opinion to support a policy and machinery to carry it out. Our social fron- 
tiers will move forward not according to abstract theories but as fast as we 
can educate one another to the possibility of effective cooperation. This 
process of democratic self-education is one of the main aspects of public 
administration. To it the administrative official must contribute his full 
share. 



CHAPTER 



The Social Function of Public Administration 

1. THE "AMERICAN SYSTEM" AND THE SERVICE STATE 

Wartime Record. In their official report on war and postwar adjustment 
policy released early in 1944, Bernard Baruch and John Hancock cast an 
appraising glance at "all of the economic systems of the world" and con- 
cluded that "the American system has outproduced the world." But they 
added a very significant qualification on the manner in which this "miracle" 
as they put it had been achieved. "With the coming of wqu\" they 
observed, va sort of totalitarianism is asserted . . . planning and execution 
rest upon one over-all purpose and a single control."]) This tribute to both 
the power of our common determination and the role of government in 
directing the mobilization of our resources as a nation appears to suggest 
a lesson for peace as well as war. 

War is not the only teacher of patriotism and civic solidarity. True 
dedication of our individual efforts to the organic development of demo- 
cratic society might furnish us on a national scale with the "moral equiva- 
lent of war," to use William James' phrase. 2 If we can attain greater service 
from our economy by effective cooperation under the auspices of "one over- 
all purpose and a single control," should we not hasten to seek the better life 
by adopting for peacetime use the wartime features of the "American sys- 
tem" which proved the key to victory? 

Peacetime Relevance of Wartime Achievement. An affirmative answer 
could find support in the character of our wartime experience, we reached 
not only unprecedented levels of productivity and national income but also 
a high mark of direct citizen participation in governmental activities such 
as selective service administration, civilian defense, and price and rationing 
administration!) Our democratic structure of government remained intact, 

. * Senate Doc. No. 154, 78th Cong., 2d Sess., pp. 3, 7, Washington: Government Printing 
Office, 1944. 

2 James* great essay under this tide has been reprinted in Winslow, Thacher and t)avidson, 
Frank P., eds., American Youth, p. 181 ff., Cambridge: Harvard University Press, 1940. 

98 



THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 99 

and our fundamental liberties were not undermined. In the spherc^pf busi- 
ness, the "American system" retained its identity as an enterprise economy, 
in the main individually owned and managed for private gain. By har- 
nessing our full productive strength, we succeeded in building a vast war 
economy atop our peace economy. At no time in our history had we accom- 
plished anything like it. 

Yet we are far from assuming that the scheme which served us well in 
war would provide us with a sound working formula for peacetime living. 
Winning a war is a goal for which we close ranks almost automatically. 
Safeguarding prosperity in the context of the democratic way of life is an 
equally worthy end, but one for which we have not yet evolved a generally 
acceptable organizational pattern. To very articulate groups, in fact, the es- 
sence of the "American system" lies precisely in the absence of any "single 
control," any "regimentation," any "sort of totalitarianism." Spokesmen of 
these groups have always insisted that the "American system" itself demands 
that government "stay out of business" and leave the economy to its 
"natural laws." " ~~~ 

Long-Range Trend Toward the Service State. However vigorously this 
doctrine has been expounded, it is clear that we have never attempted to 
practice it consistently. Suffice it to mention the Articles of Confederation, 
formulated in 1777, which authorized government to "go into business" by 
establishing its "sole and exclusive right and power" to run the postal serv- 
ice. Indeed, (.next to our unparalleled technological advance, perhaps the 
most striking thing about the "American system" in the historic perspective 
is the steady growth of direct andJndi/^i4UibUc^orUrols---by regulation,, 
by taxation, by^enfi^^TTT^ageina^nt and use of j^neyjinSarecTiffty En- 
forcement of standards of safety, by governmental insurance of risks, by pre- 
serving industrial peace, by social rehabilitation, by providing a host of 
specialized services to meet particular group needs.) For better or for worse, 
all of this is part of the "American system." 

Nor can it be argued that the gradual emergence of such public controls 
arose from conspirational scheming or lust for power, or zest for interfer- 
ence on the part of government. Traditionally suspicious of authority, we 
resorted to new controls only in the face of strong popular pressures or con- 
ditions that cried out for remedy. On this score, there is no real difference 
in the records of the Republican and Democratic parties. In each instance, 
governmental action, preventive or curative, presented itself as the lesser 
evil, when compared with an unmeliorated status quo. Sometimes the action 
taken was futile; sometimes it was foolish. Sometimes it was clumsily de- 
vised and incompetently executed. Even if it met our expectations, our 
satisfaction was not unmixed. After all, is not the lesser evil still an evil? 

One important fact, however, stood out. As the framework of public 
concern and superintendence widened, we managed to narrow the Dan- 
gerous chasm between wealth and poverty, increase our economic health, 



100 THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 

and raise the national standard of living. Government, by expanding its 
functions in the social and economic realms, simultaneously broadened the 
meaning of democracy) This was the "trend toward the service state" which 
Leonard D. White had found in evidence in the administrative evolution of 
the first three decades of the twentieth century. 3 It is still going strong. 

Assurance Versus Fear. Up to the day of Pearl Harbor, the implications 
of this trend were by no means universally appreciated. Like parents who 
do not see their children grow, most of us would not have known a trend 
had we met one. Those who became aware of it were more inclined to 
decry it than to weigh its deeper consequences. Time and again and with 
increasing frequency during the past generation we had been chilled by 
prophecies of impending doom. How could free enterprise or, for that mat- 
ter, any freedom survive if government continued to reach out farther and 
farther? How could our economic efficiency the very basis of our existence 
hold up if government meddling drained all initiative from private man- 
agement? Questions such as these inspired gloom rather than assurance. 
However, while we tended to default on convincing answers, the trend went 
on. Political power changed hands, but no party clothed with governmental 
responsibility found it practical to call a halt and defy the "trend toward the 
service state." Is it reasonable to assume that we simply did not know what 
we were doing ? 

It is much easier to accept the propositions that the^ service state isjlem- 
ocracjr broughtjipdLD-date; that the extension of direct and indirect public 
controls aims at the assertion of democracy in the nerve centers of modern 
industrial society; and that modern industrial society can endure in rela- 
tive freedom only through such assertion. This is not a new or abrupt 
turn. It is our chief means of preserving our political heritage. As one of 
the ablest defenders of the "middle way" expressed it more than ten years 
ago, "The liberty which our Anglo-Saxon ancestors have fought to maintain 
for fifty generations has been liberty underjaw., aru| Inw means regulation." 1 
Liberty under law is at the same time liberty bolstered by law, enriched and 
amplified by law liberty not only for the economically strong but also for 
the economically weaET^ln thiiT sense, the service state is the charter of free- 
dom for the commonjrian. Here Jefferson's faith in the rank and file and 
Hamilton's vision" of active government promoting the public^ intcrestjink 
up with each other in ~ 



Test of the Service State. World War II was an undoubted test of the 
"American system." It was also a test of the service state. In terms of exist- 
ing governmental machinery, we were far better equipped at its outset than 

3 Trends in Public Administration, p. 341, New York: McGraw-Hill, 1933. 

4 John Dickinson, in presenting the government side on the constitutionality of the Bitu- 
minous Coal Conservation Act of 1935, Senate Doc. No. 197, 74th Cong., 2d Sess., p. 15, 
Washington: Government Printing Office, 1936. Dickinson's general position is concisely out- 
lined in his Hold Fast the Middle Way, Boston: Little, Brown & Co., 1935. This book has 
hardlv found the attention it deserves. 



THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 101 

we had been as we stood on the threshhold of World War I. Starting with 
that federal machinery, we proceeded to strengthen it by putting ourselves, 
for the duration of the national emergency, under "a sort of totalitarianism." 
Thus forearmed, with all of our great resources at the nation's command, 
we set a world record of production. Could we have forged ahead as we 
did had we left private enterprise to its own planning and aspirations? The 
question is purly rhetorical. The triumph of the "American system" was a 
triumph of creative enterprise backed by the service state. 

But a real issue remains. Obviously, no one would contend that what 
democracy needs is "a sort of totalitarianism." Wartime demands are extraor- 
dinary. Nations cannot afford to be slow in getting into their stride. We 
confront an entirely different situation in peacetime. Again we shall be 
more circumspect and hesitant about means even when we agree on ulti- 
mate ends. Again we shall bicker and quarrel among ourselves for selfish 
reasons. Again we shall sneer at authority for the fun of it. And authority, 
in turn, will no longer be supported by those standards of exceptional lati- 
tude which are the essence of war powers under the Constitution. Granted 
all of this, we shall nevertheless have to organize ourselves in order to ensure 
our well-being as a nation. 

2. THE NEEDS OF THE SERVICE STATE 

Making Democracy Succeed. Viewed against peacetime's much-increased 
opportunities for disruptive disagreement, our postwar assignment as a na- 
tion, at home and abroad, looks formidable, to say the least. Internationally, 
enduring peace itself may be lost unless we fully act out our role as a senior 
partner of potentially decisive influence in shaping a world organization 
that will marshal both strength and wisdom. In the domestic sphere, we 
are virtually committed to perpetuation of the wartime "miracle" of pro- 
ductive abundance and maximum employment. This is not just a bois- 
terous roar of self-confidence. It is a matter of necessity. 

All of us know that democracy victorious in battle cannot convert itself 
into democracy choked by unemployment without simultaneously forfeiting 
its future. Therefore, America as well as Great Britain may well ponder 
the significance of Lord Woolton's famous White Paper on Employment 
Policy issued before the climax of the war which bluntly declared in its 
first sentence, vThe Government accept as one of their primary aims and 
responsibilities the maintenance of a high and stable level of employment 
after the war.*) If we had not already gone some distance in the direction 
of the service state, we would have to start now in a hurry. For it is plain 
that the discharge of any such broad governmental responsibility, involving 
as it does the corollary of "taking action at the earliest possible stage to 
arrest a threatened slump," entails a "new approach" 5 and specific machinery 
for its application. 

5 Cd. 6527, pp. 3, 16, London: His Majesty's Stationery Office, 1944. 



102 THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 

This machinery must be both highly sensitive and of great dependability, 
even though most of it may not be in the nature of an expansion of regu- 
latory power in the usual sense. Proper reliance on devices other than 
regulatory ones is a traditional aspect of the service state. Fiscal policy 
is a goodjllustration. (As World War II taught us how to direct our enter- 
prise economy for national purposes, so we learned in the stress and strain of 
economic mobilization the real significance of fiscal policy in its several 
components expenditures, taxes, borrowing, and management of the public 
debt. In the postwar period, fiscal policy is likely to emerge as one of 
government's main tools for achieving a satisfactory level of employment. 

Through fiscal policy we can most effectively influence the volume and 
direction of spending, the rate and character of investment, the course of 
inflationary or deflationary developments a wide range of factors that enter 
into the business cycled However, determinations in the field of fiscal policy 
must rest on a large body of factual knowledge as well as sound theory. 
Each determination, moreover, requires some implementation through 
appropriate administrative mechanisms. Even indirect controls such as 
those of fiscal policy depend for their success on adequately staffed statis- 
tical and research services, and a variety of regulatory facilities which ^n 
be brought to bear on policy execution. Of course, when government 
effect assumes responsibility for underwriting prosperity, it must be fully 
equipped for the task. We would not choose a dentist who prides himself 
on doing everything with a single instrument. 

Continuity of Progress. It is certainly a great advantage that in setting 
our sights for the postwar period we are not embarking upon a wholly 
novel venture. We may have to improvise and experiment, but for the 
most part such improvisation and experimentation will be guided by prac- 
tical experience gained in the past. Hence, the "trend toward the service 
state" is in itself a valuable legacy. Fortunately, it is a legacy which bears 
the imprint of times of peace, and for this reason lends itself better to peace- 
time application than would any innovations springing from wartime neces- 
sities. If we had only the wartime record to guide us, we might be very 
doubtful about its longer-range relevance. The American people have more 
than once startled their enemies by throwing all of their might into un- 
wanted war. Yet they have always drawn a sharp line between waging 
war with all their power and returning to their peacetime business. If they 
have erred in this respect at all, the error has been on the side of being 
too rigid in observing the necessary line of demarcation. 

Small wonder that the service state, in recapturing for democracy and 
for accountability to the public some vital areas of social and economic 
life, has met stubborn resistance by those who had previously staked claims 
to immunity and exemption for their own ends. Laissez faire had its en- 
chantment for the few when the many did not stir. But even in its heyday 



THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 103 

the doctrine of government nonintervention was elastic enough to allow 
for tariff protection by government. And the idea of protection carried over 
into other fields. Industrial society cannot endure without a considerable 
degree of stability, firmly grounded in law and regulation. 

As we plunged repeatedly from heights of prosperity into valleys of 
depression, we learned to fashion ^safeguards against recurrent calamities. 
Eventually, these safeguards extended all the way from government pro- 
tection against monopolistic exploitation and cutthroat .competition for the 
sake of free and fair competition to government protection against the 
hazards of old age and unemployment. Nor must we forget the remark- 
able spread of government lending activities, which reached an unprece- 
dented expanse in the establishment, at the close of the Hoover Adminis- 
tration, of the Reconstruction Finance Corporation. This agency alone 
has probably done more for business than was accomplished for the unem- 
ployed by all the public works programs of the Great Depression^ 

Surviving Contradictions. Have there been planners of the service 
state? Not in the sense in which we think today of planning. The service 
state was not conceived on any general plan. As we sought remedies against 
economic and social ills and ailments over more than half a century, we in- 
serted public controls in piecemeal fashion and at a variety of points. If in 
the end the cumulative effects of these efforts came to resemble something 
like a coherent scheme, it was by accident rather than by prior intent or 
design. However, by the eve of World War II the outlines of a reasonably 
consistent scheme had become apparent. 6 

It is true that contradictions in structure still remained visible, but they 
were negligible in comparison with the unresolved and more fundamental 
contradiction in public attitudes toward the service state.^On the one hand, 
no open-minded observer could fail to notice that the \Ajnerican system" 
had long ceased to be one of private enterprise exclusively, that it had be- 
come in fact a mixed economy in which both the private and the public 
sectors fulfilled essential tasks, in many ways complementary in nature. 
It was apparent that a decisive weakening of the public sector would merely' 
restore earlier conditions of social and economic vulnerability which today 
no other democratic nation in the world is willing to tolerate. On the other 
hand, all too many of us are still captives of obsolete slogans and stereotypes 
which depict the service state as a parasite feasting on the body of the 
"American system." This fundamental contradiction, more than anything 
else, accounts for the fickle climate of opinion in which the service state 
operates. How can we acquire the highest degree of -skill in operating the 
governmental machine when we permit ourselves to be obsessed with the 
idea that the machine will destroy us? 

6 Perhaps the best comprehensive description of the service state before our entry into 
World War II is contained in Lyon, Lcverett S. and Associates, Government and Economic Life, 
2 vols., Washington: Brookings Institution, 1939-1940. 



104 THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 

It is vital that we take a calmer view of the service state as a set of in- 
stitutions that have grown to be indispensable in sustaining our economy. 
The question has never been one of liquidating those institutions in the 
interest of an entirely unworkable, absolute freedom of enterprise. Abso- 
lute freedom would annul all community. More than once in the past, 
we have been reminded by the Supreme Court itself that the free society en- 
dorsed by the Constitution involves the mutual adjustment of rights, that 
all rights are relative, and that each right is conditional on the self-preser- 
vation of the public order. The service state, being merely a means to an 
end, effects such adjustments both in the relation of right to right and 
in the relation of right to obligation. 

However, the service state cannot make its full potential contribution if 
its principal purpose is misunderstood. It cannot do two things at once 
attain its basic goal within the framework of democracy and at the same time 
fight a running battle in defense of its existence. As long as powerful groups 
and special interests inveigh against the conception as well as the machinery 
of the service state, they have no ground for the complaint that government 
offers no full assurance of its competence to cope with complex processes. 
For it is precisely the perennial denunciation of the service state that inter- 
feres most seriously with the gradual refinement and perfection of respon- 
sive and responsible government. 

Beyond this question of public confidence identical in the main with 
confidence in democracy and democratic procedure-stress must be laid on 
other elementary needs of the service state. Eitst, there is the need for re- 
sourceful public -management. Second, there are the related needs for public 
planning and policy continuity. Third, there is the need for continuous 
synthesis of fundamental motivations political, economic, and social. Each 
of these needs involves the interplay of all three branches of government, 
legislative, executive, and judicial. No one branch and no one level of 
g(>tfernment can singly undertake the whole assignment. Willing coop- 
eration among all three branches and on all three levels is imperative. So 
is civic cooperation.^) 

As long as its elementary needs are only partly met, the service state 
remains little more than an idea. As long as its needs are answered only 
in a haphazard way and without sufficient attention to their interrelations, 
it will fail to mature. QThere is a vast difference between maintaining large- 
scale governmental organization, operating at limited capacity, and actually 
securing the greatest benefits from that organization) If in the machine 
age it is impossible for democracy to keep itself alive without the reenforce- 
ment which the service state provides, it should follow that we ought to 
exert ourselves to make the most of our opportunity. 

J Requirements of Public Management. This is not the place to unfold 
in detail the major themes suggested in any enumeration of basic require- 
ments. That will be done in subsequent chapters. Here, passing reference 



THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 105 

to only the most obvious implications must be sufficient. Resourceful man- 
agement in government presupposes several things. In the first place, the 
public sector of the "American system" must be nourished with adminis- 
trative and professional talent at least in the same degree to which that 
talent has been drawn into the private sector since the advent of industriali- 
zation. This is not simply a matter of appropriate standards for entrance 
into public service. It also raises the problem of making public employ- 
ment attractive in terms of both general prestige and career opportunities/ 
And, sgcondj we cannot delay for long a practical reconciliation of the 
increasing demands for administrative self-reliance, initiative, and inventive- 
ness with more concise elaboration of effective forms of general control and 
administrative responsibility. Thus far, legislative control has succeeded 
neither in securing true accountability nor^in showing itself capable of 
promoting vigorous management. 8 On this score, the record of private 
business is more satisfactory than that of government As we know also 
from our experience with judicial control over administration, responsibility 
is weakened rather than strengthened if it is exacted primarily TnTTegative 

forms of invalidation. - 

"Requirements of Policy Planning. Equally important is the need for 
adequate organization for public planning and policy continuity. A people 
united in the pursuit of its main national objectives can well be presumed 
to give unified direction to public undertakings. When unity of purpose is 
impaired, distortion of general policy through minority pressures and vested 
interests is not checked readily. 9 However, the impact of these forces of 
distortion may be lessened in large measure by governmental arrangements 
designed to bring forth something like a rationally conceived national 
agenda. Planning is an inseparable aspect of our civilization. It is recog- 
nized by industry as a source of profit and an insurance agaiftst loss. We 
cannot do without it in carrying on our business as a nation. 10 While today 
this assertion is perhaps uncontroversial, it cannot be said that we are unani- 
mous on such questions as the proper location of the planning function 
and the scope of its mandate. Acknowledgment of the importance of plan- 
ning does not carry with it any commitment on the questionable alternative 
between economic freedom and a planned society. The degree of planning, 
realistically speaking, will with us always depend on practical needs, not 

7 The outstanding American report in this area is now more than ten years old: Com- 
mission of Inquiry on Public Service Personnel, Better Government Personnel, New York: 
McGraw-Hill, 1935. 

8 Reference may here be made ag*in tp one of the most incisive public documents bearing 
directly on this question: President's Committee on Administrative Management, Report with 
Special Studies, Washington: Government Printing Office, 1937. 

9 A sharp picture of the inroads of special interests into the general welfare is presented 
in Chase, Stuart, Democracy under Pressure, New York: Twentieth Century Fund, 1945. 

10 For an authoritative account of a significant "chapter in American planning experience,*' 
see Merriam, Charles E., "The National Resources Planning Board," American Political Science 
Review, 1944, Vol. 38, p. 1075 ff. 



106 THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 

on abstract preferences expressed in oversimplifications. Looking toward 
its postwar responsibilities, government cannot be indifferent to the waste 
and peril of contradictions in policy. Consistency of policy, on the other 
hand, calls for combined legislative and administrative operations. 

We can best hope to attain synthesis of fundamental motivations on the 
basis of a national agenda. Above all, such an agenda would define and 
clarify the tasks of government in relation to our economic and social life. 
As one result, the respective functions of the private and public sectors of 
our mixed economy could be circumscribed more explicitly. Once these 
respective functions stood out in greater clarity, we could hope to reduce 
substantially the dangers of friction and disruption. To the same extent 
we would win a precious chance of increasing the general efficiency of the 
"American system." If we seize upon this chance, we are bound to gain 
more than mere material advantages. By developing our confidence in the 
soundness of our approach and in our capacity for operating effectively as 
a nation, we can make it plain to everyone including ourselves that 
democracy is not something nice to talk about but that it can work, 

3. PUBLIC ADMINISTRATION INSTRUMENT OF GOVERNMENT 

Prominence of Public Administration. The most distinctive character- 
istic of the service state is the prominence of public administration. As 
government shifts from a relatively passive to an increasingly active role, 
it inevitably expands its machinery of action. This machinery assumes the 
character of a permanent establishment because government is compelled 
to take on continuing responsibilities which can be fulfilled only through 
continuity of operations. 

Typically, continuing administrative operations fall within the province 
of the executive branch. Typically also, their conduct requires the dele- 
gation of administrative power to each individual agency. While it is 
true that even the weakest administrative system must have at its disposal 
some degree of administrative power, in our day such power has acquired 
an importance in the life of the citizen equal to that of legislative power 
and in certain ways much greater than that of judicial power. This devel- 
opment, being actually a manifestation of the "trend toward the service 
state," has been in evidence as long as the trend itself. Several years before 
the birth of the New Deal, Ernst Freund, a leading authority on admin- 
istrative law, observed that ^"administrative power appears as one of the 
established political facts in present-day government.^ 1 His judgment was 
not ahead of the times, even though it was not yet reflected in the editorial 
pages of our newspapers. 

Demands on Legislative Leadership. The prominence of administration 
in our contemporary political system does not imply a corresponding de- 

11 Administrative Powers over Persons and Property, n. 584, Chicago: University of Chicago 
Press, 1928. 



THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 107 

cline of legislative power. On the contrary, as modern government has 
progressed to the point of being bigger than big business, the scope and 
magnitude of its operations render farsighted direction ever more significant. 
If we may speak of any change in the essential nature of legislation, thai 
change would lie in mounting demands on legislative leadership. When 
administrative agencies touch upon the activities of millions of citizens, 
it is a matter of highest concern whether or not the legislative marching 
orders for administrative officials are framed in full comprehension and 
recognition of the public interest. Ours is still as much a government of 
laws as it was designed to be by those who formulated the Constitution. 

y Administrative power is not self-generative. No government agency can 
take action without a statutory foundation for action. No government 
agency is legally free to push action beyond either the bounds of lawful 
means or the limitations drawn in the annual budget adopted by the legis- 
lative branch. ^ However, statutory definition of administrative marching 
orders can draw only major outlines. It would be unable to penetrate into 
the mountain of detail that is necessary for effective deployment of govern- 
mental forces in pursuit of objectives laid down in law. Thus the legisla- 
ture is called upon to meet the complex task of establishing priorities of 
goals and giving general direction through statutory policy pronouncements, 
while at the same time allowing administrators sufficient leeway to utilize 
their agencies to the best possible public advantage. Few would maintain 
in the face of this task that the service state is apt to reduce thT legislative 
branch to the function of dignified ornament. Active government sorely 
needs wise legislative guidance. 

*^Role of tfte^Judidd Power. Nor can it be said that the prominence of 
administration detracts from the institutional rank of the judicial power. 
To be sure, the judicial power may isolate itself. Courts have always tended 
to gravitate toward becoming exponents of conservative attitudes. If any 
documentation is needed in this respect, it may be found in the history of 
judicial review of the constitutionality of legislation. In fact, in the past 
the service state has suffered its most grievous defeats 'from the recalcitrance 
of the judiciary. The memory of the bitter conflict between the New Deal 
and the Supreme Court is still fresh in our minds. That conflict could 
have been predicted, for during the New Deal we tried to make up for lost 
time and thus advanced at a more rapid pace. What was new was not the 
direction of the advance but its relative speed. As the speed increased, the 
courts braced themselves to intensify their traditional braking effect. 

Granting that no court is safe when stepping between a determined 
people and its needs and aims, there remains the question of applying judi- 
cial power with insight. Administrative agencies must be kept within the 
scope of their statutory mandate and the range of lawful means, but this 
fact should not lead to a crippling of resourceful public management. The 
judicial power denies itself opportunities for constructive influence in ad- 



108 THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 

ministration if it operates primarily as a restrictive force. Even in protect- 
ing the citizens against illicit encroachments, the judiciary can help to build 
a positive code of administrative conduct. In the service state, the presence 
or absence of a code of this kind is a matter of great consequence. But 
courts disqualify themselves from making a decisive contribution to the 
development of a positive administrative code when they permit their best 
energies to become absorbed in efforts to block the growth of the service 
state on principle. 

Resources of Administration. As an instrument of government, public 
administration occupies a central place because of its capacity for achieving 
results by direct operations. It is eminently suited to function as an agent 
of policy, to give policy immediate meaning in the matrix of economic and 
social interrelations. Not being tied down to the formalized procedures 
appropriate for judicial decisions, it is elastic in its approach. It is the gov- 
ernment's business establishment par excellence. Whereas policy can only 
attempt to establish a general rule, administration carries the application 
of the general rule into the boundless diversity of concrete situations. In 
giving specific application to the general rule, administration can take into 
account the numerous variables of different conditions. Because of this 
flexibility, it can obtain compliance in varying situations without either 
jeopardizing the consistency of the general rule or making the general rule a 
crushing force that strikes everyone and everywhere in one fell swoop. 

Administration as a Fitting Process. Administration thus presents itself 
as a fitting process as a means of giving policy concise expression in a 
highly diversified society. Owing to this characteristic, administration can- 
not live without discretion. A mechanical tool can eat its way through a 
sheet of steel, repeating its operation with never-changing precision. Ad- 
ministration, by way of contrast, deals with the dynamics of an organic 
society made up of human beings. Even in routine transactions, therefore, 
administrative procedure must be alert to the dynamic quality of economic 
and social life. It must ascertain facts without bias, appraise them astutely, 
bring policy to bear upon the emerging picture, and shape its decisions in 
wakeful appreciation of the intent of policy and the results to be produced. 
..In each of these phases, administration must aim at coherence without be- 
coming a helpless victim of precedent and operational convenience. In 
each phase it must keep its mentality free enough for innovation and con- 
stant improvement of methods and procedures. In each phase it must set 
its course in such a way as to prove itself the servant of the people. A 
single glance at any of these postulates is all we need in order to understand 
the necessity for securing the highest caliber of administrative stewardship. 

4 4 . THE ENLISTMENT OF ADMINISTRATIVE JUDGMENT 

Legislative Marching Orders. As an instrument of government, public 
administration moves on marching orders written into laws and regulations. 



THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 109 

Being the agent of policy, it must on principle accept legislative superin- 
tendence and executive command. It is not free to exercise a veto power 
in the name of greater expertise. This principle is easily stated, but it raises 
many subtle points of administrate ethics. Government agencies, respon- 
sible for defined areas of public activity, are prone to develop a stake in their 
programs. That is not bad in itself, because administrators will on the 
whole render better service when they have faith in their missions. But it 
is also true that their whole-hearted identification with the task assigned 
them may collide with their obligation to bow to direction whenever such 
direction reflects changes of policy which rip into established programs. In 
situations of this kind, the deeper loyalty of service must triumph over sec- 
ondary loyalties to cherished ends and means. Administration as an agent 
has no moral right to plot against its legislative principal, however much the 
principal may seem to be in error. 

This does not mean that administration is free to use its mind only in 
performing its duty as an agent of policy. Throughout the business estab- 
lishment of government, we find today a rich assortment of staff services 
of high quality. No less impressive is the store of sound administrative 
judgment derived from cumulative experience. Many of the research teams 
which have been built up at various points of the governmental structure 
are wholly on a par with those developed in the realm of private enterprise. 
In the supply of managerial skill, too, government has ceased to be gener- 
ally inferior to business. How obsolete in this respect the beloved catch- 
words of bygone days are is attested by the degree of unpublicized informal 
cooperation among key specialists from private and public enterprise in a 
great many professional associations. Give-and-take in the exchange of 
helpful information has become a mutual process from which government 
and business profit alike in equal proportions. 

Political Feasibility of Policy. With so much pertinent judgment and 
experience available on tap, it would be folly to insist in the interest of 
abstract purity of functions that legislative direction should never nurture 
itself by resort to expert counsel coming from the administrative sphere. 
As a matter of fact, such counsel is constantly sought and utilized by both 
the legislature and the chief executive. It must be admitted, however, that the 
chief executive, being in a strategic position, can more expeditiously equip 
himself with facilities designed to make available for his use the whole body 
of administrative information. The creation in 1939 of the Executive Office 
of the President illustrates the way in which facilities of this character may 
be linked with the head of the government's business establishment. Central 
staffs attached to the chief executive are in a position to evolve reporting 
relationships with the departmental system through which appropriate in- 
formation flows up, to be assembled finally into a comprehensive picture. 
Much of this information is immediately translated into intelligence to 
serve internal control purposes. A considerable volume, however, feeds 



110 THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 

into the policy-making process, either by pointing up issues that require 
solution or by providing supporting data for tentatively formulated policy 
proposals. 

Successful government involves the accomplishment of feasible objectives. 
Determination of feasibility depends on a number of factors. Politically, 
a feasible, objective is one that is wanted by sufficiently strong groups of the 
population or for which popular endorsement may be obtained through 
effectively stimulated public debate. Determination of such feasibility is a 
question which elected representatives of the people are generally better qual- 
ified to decide than administrators. It includes, for example, a weighing 
among goals which cannot all be achieved at the same time. Here, again, 
political sense is generally more important than administrative experience. 
However, once political feasibility has been ascertained, there is still the 
problem of the appropriate governmental approach. Big business though 
it is, government, like any other business, has to think in terms of available 
resources, organizational and operational as well as financial. 

Administrative Feasibility of Policy. A politically feasible objective may 
not be attained at all if the administrative system is too feeble for the task. 
Even stronger administrative machinery may be dangerously overworked 
if a politically feasible objective of considerable magnitude is tackled in 
one reckless effort. It may be necessary to progress step by step, and to 
time the steps at wider intervals. On each of these points, administrative 
judgment is able to contribute substantially to the determination of sound 
policy. The same is true of defining the administrative pattern that will 
offer the greatest insurance of straightforward advance toward the estab- 
lished goal. Practical alternatives can be analyzed before action is taken. 
Such planning cuts the chance of breakdown to a minimum. It also pro- 
vides protection against costly organizational and technical errors. In short, 
it is a valuable aid in achieving economy of effort. 

Blending of Judgments. While it is thus clear that administrative ad- 
vice is an important ingredient in the making of policy, we must not assume 
that there is a precise borderline between consideration of political feasibility 
and examination of administrative feasibility. The more both merge, the 
better will be the end result. Because administrative advice has no direct 
representation in the political councils, it must be drawn in systematically. 
Moreover, legislative bodies must keep their policy planning open to ad- 
ministrative alternatives in order to evolve a statutory formula that will 
best lend itself to prompt execution. Conversely, administrative officials, in 
advising on policy, reduce the range of their assistance if they fail to give 
careful thought to the legislative balance of power, the enunciated or antici- 
pated preferences of the chief executive, and the probabilities of public re- 
actions. Ideally, political and administrative thinking should blend into 
i joint process. 

The separation of powers in our governmental system is on the whole 



THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 111 

unfavorable to such blending, especially when legislative and executive 
prerogatives are jealously guarded. But we do have avenues through which 
we can come near the ideal. The chief executive has many opportunities 
for submitting recommendations to the legislative branch; these may be 
substantiated by extensive staff work. The legislature, in turn, is adequately 
equipped in its committee system to take testimony from administrative 
officials closest to the subject matter under discussion. In addition, intimate 
though unofficial cooperation between the staff employed by legislative com- 
mittees and staffs engaged in broader studies in various agencies is often 
fruitful. This checking of notes and interchange of findings is sometimes 
more productive than public presentation of testimony before legislative 
committees, which shape their basic inferences in closed executive session. 
In general, however, we are still far from a rational scheme through which 
political reasoning and administrative judgment can be merged in the formu- 
lation of policy. Conceding this partial failure, it is well to recall that, in the 
direction of government business, the role of administrative judgment as a 
source of informed policy decisions has steadily expanded. 

Administrative Freedom of Expression. In furnishing counsel-on policy 
matters, administrative officials may foster perilous illusions if their en- 
vironment encourages servility and spinelessness. They are of no help 
whatsoever, and can easily turn into a positive menace, when conditions in- 
duce them to echo the voices of the mighty. Administrative judgment 
must rest on unquestionable integrity. It cannot be both trustworthy and 
pleasing to everyone. It must enjoy freedom of expression. Advice amounts 
to nothing when it is fearful of disagreement. The climate of administrative 
judgment is not made by administrators alone. It is the product .of many 
things: public attitudes toward the government's business establishment; 
cartoons and editorials; aggressive and defensive propaganda coming from 
particular special interests; legislative resentments; administrative self- 
complacency. Sometimes we run into deep-rooted doubts whether our 
national ways and habits, especially in the legislative sphere, leave room for 
public administrators who pour their hearts into their work, think for 
themselves, and make no bones about the state of affairs and what ought to 
be done about it. These doubts may merely indicate the obvious that the 
service state is still in its youth. But we cannot escape the conclusion that 
when there is competence for counsel on policy in our administrative system, 
it is only commonsense to use and strengthen it. 

5. THE CONTRIBUTION OF SERVICE 

Popular Basis of Administrative Services. A fairly detailed listing of all 
of the services performed by government federal, state and local would 
fill many pages. None of these services was forced upon the community by 
wild-eyed officialdom. Each came into being in response to public demands 



112 THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 

to which legislative bodies paid deference a perfectly natural development 
in a democracy. 

The power of votes and the threat of reprisals in subsequent electoral 
campaigns hang like dark clouds over the legislative scene. If every public 
demand could be subjected to popular referendum, many loudly advocated 
propositions might die a natural death without gaining striking power in 
pressure politics. But the vast bulk of legislation is handled by representa- 
tive assemblies exposed to minority agitation, while the public at large is 
normally amorphous and unorganized. It is divided by conflicting loyalties 
that pull simultaneously toward party, class, general inclination of outlook, 
real or imagined self-advancement, religious denomination, occupational 
organization, and an abundance of other interests, large and small. In this 
bewildering and ever-changing pattern the public falls apart into many 
publics. And the better organized for political pressure each public is, the 
greater is its chance of overriding the public at large. This explains in the 
main the failure of straight consumer representation in the political arena. 
It also explains why the service state is neither of one cast nor free from 
inconsistencies. 

Habit of Self-Restraint. Of course, it would be a strange misconception 
to contend that the test of democracy is abstract wisdom. As individuals, we 
commit sad errors of judgment in matters of great importance, do foolish 
things for unaccountable reasons, cling tenaciously to absurd prejudices, 
cast prudence to the winds when we feel like it. Can we hope to do much 
better collectively? Actually, we do somewhat better in the realm of public 
affairs because here reason follows us like a faithful dog. Here there is 
considerably more argument and counterargument than we would be 
willing to put up with in our private affairs. And here we also have more 
free advice from authoritative sources the League of Women Voters, the 
National Association of Manufacturers, the Secretary of State, our Congress- 
man, the head of the Bureau of Labor Statistics, to mention but a few. 
Sometimes we entirely change our minds on such advice, though even when 
we do we usually line up with the side that promises us the largest slice 
of cake. Yet we are on the whole rather particular about the price of the 
cake and more anxious to restrain our appetites than we are in our private 
spending. 

This relative eagerness for self-restraint is a wholesome tendency. It 
should be no more than that. For a considerable time, especially the closing 
decades of the past century when our great economic interests reaped the 
harvest of our continent, the masters of new fortunes tried to convince us 
that we had to make this tendency toward political self-abnegation into 
an axiom of governance. (They argued that the best government would be 
one that governs least, one that entrusts control to the natural drift of the 
economy and the profit motive. Only when it became apparent that we 



THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 113 

fared none too well under this prescription did we cast about for a better 
one. 

Governmental Reinforcement of the Enterprise Economy. Thus the 
structure of our public services came forth without a supporting ideology, 
even running counter to the general undertone of domestic propaganda. We 
bought the service state in relatively small pieces, each piece being badly 
needed to fill cracks and breaches in the industrial order. The mixed econ- 
omy took form, not because we thought it good, but because necessity dic- 
tated successive reinforcements of the private sector through governmental 
action which added to the public sector. The service contribution of admin- 
istrative agencies, viewed as a whole, lies primarily in its functon as a broad 
support of the enterprise economy. 

It may be presumed that private business would be able to run our 
unemployment and old-age insurance schemes as well as does government 
if there were sufficient profit in it. It might be conceivable for business to 
service itself on some cooperative basis in about the same way that it is 
being serviced at public expense by such agencies as the Department of 
Commerce. It is perhaps possible for the several large farmer organizations 
to maintain specialized staffs that could jointly undertake the job now done 
by such establishments as the Bureau of Plant Industry, Soils, and Agricul- 
tural Engineering. However, if we think in the perspective of the total 
picture of national efficiency, it is not difficult to spot the comparative weak- 
ness of such solutions. Each of these governmental services and they are 
examples chosen at random benefits not only from direct access to data and 
experience accruing in public activities, but also operates under standards 
of strict accounting to the public at large. Cost accounting under budgetary 
control and expenditure justification to the satisfaction of the legislature are 
not in themselves the most important factors. More significant is the gen- 
eral atmosphere of public accountability. Government cannot afford to 
chisel on its data. It cannot safely underwrite the interests of individual 
groups. It must come very close to scientific accuracy and impartial service 
to all. 

Benefits of Regulation. This is true also of the regulatory process. Regu- 
lation has sometimes been slapped down on interests which have outraged 
our sense of equity, but punitive regulation has always tended to throw new 
burdens of ill-feeling on the community and to overstep its legitimate aims 
in the heat of battle. Ordinarily, the punitive impetus does not survive for 
any length of t ; me, and methods are later adjusted to meet the practical 
business at hand. We need only look at the relationships between carriers 
and shippers on the one hand and the Interstate Commerce Commission 
on the other. 12 

12 Some very pertinent observations are contained in a recent tribute to a great adminis- 
trator who died in hprness: S wisher, Carl B., "Joseph B. Eastman: Public Servant," Public 
Administration Review, 1945, Vol. 5, p. 34 ff. 



114 TK SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 

Evidence shows that regulatory bodies, when they have established them- 
selves, develop a peculiar predilection for those subject to their powers. 
This is hardly surprising. The function of regulation is to police in the 
interest of a healthy state of affairs. The goal is constructive, and the pro- 
cedure must correspond to it. Even if regulatory bodies come to see the 
public welfare to some extent from the angle of the welfare of those to be 
regulated, they nevertheless resist the temptation to give away their birth- 
rights* To steady them when they need steadying is the task of the 
legislature or, more precisely, of free public criticism. 

Popular Accountability of Administration. The service motive is not an 
exclusive property of government. No big company today overlooks oppor- 
tunities for selling itself on claims of superior service. We hear these claims 
everyday in the commercial plugs over the radio; we read them on trolley 
and bus posters and in the smooth-voiced advertisements of popular maga- 
zines. Business wants to serve as well as government. However, as cus- 
tomers and consumers we have much more direct control over public 
business and public services than private enterprise would be willing to 
allow. We have a sharp eye on our public servants, and they know it. We 
can chastise them with assured effect through public complaint and legis- 
lative grilling. We can take business away from them by cutting down 
appropriations. We may often censure too rashly, but the irascible temper 
which we habitually reserve for governmental errors and failings keeps 
administrative officials on their toes. Administration ' cannot withhold its 
books from public inspection. We can force responsive service. 

6. PUBLIC ADMINISTRATION SOCIAL BUFFER 

Fountains of Administrative Knowledge. The broad spread of govern- 
mental activities in the service state has had consequences extending beyond 
the mere expansion of public services. When government is interposed at 
many points in our society, it gains extraordinary opportunities for devel- 
oping a system of intelligence whose output becomes public knowledge. 
Take something as vital as dependable statistics on unemployment. Before 
the more than 400,000 Smiths, together with the Joneses, the Thompsons, and 
the rest of us, had been duly entered in the central records of the Social 
Security Board, we had to guess at the volume of unemployment. Now, as 
an incidental by-product of our social security scheme, we can always know, 
with a high degree of exactness. Fortified with up-to-date information, 
government is in a position to plan policy with considerable assurance. It 
is also able to obtain early warning of impending slumps and take remedial 
action before being overtaken by events. It can even put its finger on 
specific areas where maladjustments have become acute, and probe into 
underlying causes. 

Government's Intelligence Function- The intelligence function of mod- 
ern government is in many ways crucial to the fate of the economic and 



THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 115 

social order. Jeremy Bentham saw it in this light more than a century ago 
It lies at the heart of our attempts at achieving a high level of employment 
in the postwar period. The role of the federal government in attaining 
maximum employment is predicated on the availability of a large array of 
detailed statistical data on such activities as consumer spending; business 
expenditures and outlays including construction, additions to inventories, 
and exports; and state and local expenditures including projected public 
works. Moreover, retrospective data alone would not be adequate. They 
must be supplemented by date which predict future facts. We would be 
stopped in our tracks and left to face complete uncertainty if the entire 
body of government intelligence were still in the state which existed only 
fifteen years ago. Today we are better prepared, because government, in its 
interlocking with the enterprise economy, has multiplied its eyes and added 
finer lenses. 

Public Research and Analysis. The more it knows, the better govern- 
ment can judge. Seeing more, it is no longer so easily eluded by those 
whose doings shy from light, nor is it quickly misled and confused by the 
assertions of optimists and pessimists alike. Capitalizing on its far-flung 
intelligence, government can substantiate its hunches and projections, and 
is less helpless in rebuttal. In our civilization, reseanh and analysis of in- 
formation, together with scientific fact-gathering and wider dissemination 
of knowledge, are national resources of the greatest practical value because 
they give our hand a surer touch in shaping our institutional and technolo- 
gical environment. Truth is an objectifying influence in the identification 
of the public interest and the pursuit of public ends. It takes the wind 
out of the sails of partisan clamor and intentional or unintentional mis- 
representation. 

The acquisition of knowledge is a field of primary concern to demo- 
cratic government. Its ascendancy was properly stressed in the epoch- 
making report of Great Britain's Machinery of Government Committee 
under Haldane's chairmanship at the end of World War I. 13 Our experi- 
ence in World War II with the Office of Scientific Research and Develop- 
ment, established for the purpose of securing adequate provision for research 
on scientific and medical problems relating to national defense, represents 
a memorable step in the same direction. But research must not be confined 
to laboratories alone. The whole business establishment of government, 
although it is in business for business' sake, is at the same time a gigantic 
test tube with which we gradually expand our social knowledge. In this 
way we not only augment the body of information to guide the policy- 
making authorities; we also set down increasingly definite terms of refer- 
ence for legitimate public discussion. It is harder to fool the people when 



18 Cd. 9230, London: His Majesty's Stationery Office, 1918. 



116 THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 

authentic facts and figures make lies and wild statements uncomfortable 
for their authors. 

Getting ct the facts. Through its administrative system, government 
has been able to organize its intelligence function. Without something like 
the administrative machinery which we have built up over the years, gov- 
ernment intelligence would necessarily be secondhand and thus of dubious 
merit. The risk of accepting at its face value the brief of an interest group 
or the complaint of a constituent is well known to every seasoned lawmaker. 
With literally hundreds of thousands of government employees in daily 
touch with countless economic and social activities and various elements of 
the population, headquarters offices meet few obstacles in providing for 
continuing public reconnaissance, in gauging pressures and tensions in the 
industrial order, and in getting at the relevant facts. On the other hand, 
general awareness by the public of the intelligence function of government 
has a restraining effect on the voraciousness of special interests and the char- 
acter of pressure-group rationalizations. To this extent, administration places 
itself deliberately between contending forces, each of which could have its 
way only at the expense of all of us. 

More explicit and more direct is the buffer function of the administrative 
system in the immediate exercise of authority, either of a regulatory nature 
or as the basis of concrete services. Here government, by being on the 
scene, enforces the ground rules of democratic society. This task includes 
not only the job of safeguarding defined standards of human conduct and 
decent living but also that of preserving the essential framework of indi- 
vidual initiative and accomplishment. ^Administrative power is brought to 
bear upon the economic power wielded by giant organizations which, if 
left unchecked, would play havoc with the basic interests of the individual 
as well as with those of the community at large^It is true, of course, that 
administrative agencies are not always strong enough to muster unyielding 
resistance under the impact of determined pressures. 14 But we should not 
lose sight of the fact that in the struggle of organized forces for superiority, 
government has gone far toward running interference for the underdog. 

Concern for the Underdog. Concern for the underdog is deeply in- 
grained in our American mores. It gives our political thinking a distinctive 
flavor. Yet, in the day-by-day operation of our economy we are inclined 
to a startling degree to condone ruthless prosecution of selfish ends. A broad 
strand of our social philosophy supports the fears which Louis Brandeis 
aptly expressed in speaking of the curse of bigness. It is equally American, 
however, to write bigness in big lettersto take pride in the colossal and 
still greater pride in the super-colossal. The native soil has favored the 
growth of economic empires in our midst, and the captains of these empires 
have ranked above our politicians. When we enshrine bigness as we did 

14 The best study of this problem is Herring, E. Pendleton, Public Administration and the 
Public Interest. New York: McGraw-Hill, 1936. 



THE SOCIAL FUNCTION OF PUBLIC ADMINISTRATION 117 

in the days of laissez faire, we cancel the buffer function of the administra- 
tive system. Public officials, however firmly established their service ideology 
may be, cannot withdraw into the ivory tower. They cannot defy public 
opinion or what successfully poses for it. How well administration per- 
forms its buffer functions is, therefore, mainly up to all of us. 

Our conflicting reactions toward bigness have never quite permitted us 
to seek the ultimate criterion of effective organization in its contribution 
to the life of the common man. There have been times when shrewd play 
on our emotions made us more fearful of big government than of big 
business. One thing is clear, however. If ours is to be a common man's 
democracy, government must be big enough to measure up to the order 
of magnitude prevailing in the economic sphere. 



Pan H 

ORGANIZATION AND MANAGEMENT 



CHAPTER 



Planning and Administration 

1. THE IMPORTANCE OF PLANNING 

Essence of Planning. Planning is preparation for action. It is the vital 
step in any great enterprise, for many subsequent decisions about organiza- 
tion, procedure, personnel, and policies must flow from an original concep- 
tion of purpose. All administrative agencies are set up to accomplish some 
desired goal. In a sense, all the problems of administration are problems 
of translating purpose into action. The first concern of administrators at 
all times is raising and answering the question, "What am I expected to 
accomplish?" The second concern is, "How shall I accomplish it?" 

Planning gives meaning to action. The work done by an administrative 
agency will achieve its goals only if careful plans have been prepared which 
show what is to be accomplished. Otherwise, there may be much action 
of all kinds, but few results. Or the many activities undertaken may lead 
to contradictory results. 

Planning is a technique or process. In itself, the word "planning" sug- 
gests no goals. It merely means that some method is followed which re- 
sults in determining what is wanted and in a plan of action for reaching 
that desired goal. Planning is a method of approaching problems a 
method which says, "Let us define clearly what it is we wish to do," and 
then asks, "What steps shall we take in order to accomplish our purpose?" 

Planning is continuous. Just as life is dynamic and everchanging, so 
must planning by individuals and by organized groups be dynamic. Early 
plans may become inadequate as new factors in any situation are discovered, 
as changing circumstances occur, as we grow and learn more about the 
environment in which we live. Plans must accordingly be modified from 
time to time. Periodic or even continuous review of fundamental purposes 
is desirable for any institution or any group in order to ensure that the 
work done will meet present conditions and needs. 

Planning embraces all aspects of human life. It concerns every phase 
of activity in which we participate, both individually and as organized 

121 



122 PLANNING AND ADMINISTRATION 

groups. The subjects of concern in the planning work of the federal gov- 
ernment before World War II are well illustrated in a symposium on the 
topic published in 194L 1 The chapter titles included land planning, water 
resources, energy resources, industrial policies, savings and capital forma- 
tion, income distribution, employment planning, public works, transporta- 
tion needs, agricultural adjustment, population, nutrition, housing, educa- 
tion, health, recreation, social security, international economic relations, war 
planning, and industrial mobilization for defense. These were all subjects 
of some degree of planning in the federal government. State and local 
governments had many of the same concerns and others as well. Private 
groups, from the great corporations to fraternal societies, had and have 
their plans. An account of the steps taken by one large corporation, the 
General Electric Company, in reviewing its plans and in formulating new 
ones on the eve of World War II well illustrates planning by private 
enterprise. 2 

Since those who direct organized efforts must begin by planning them, 
planning is the first responsibility of management. The continuing concern 
with planning which every alert and efficient agency must manifest is well 
recognized today in every discussion dealing with the subject of manage- 
ment. For example, a recent survey of the organization and direction of 
some twenty business corporations declares it to be the primary responsi- 
bility of top management to provide: 

. . . far-sighted planning and clarification of objectives, visualizing the 
needs of the business and determining its most advantageous future 
course. . . . There is nothing about an organization more important than 
its future. Owners, management, employees, and society in general are, 
or should be, more concerned about where a company is going than 
where it has been. . . . 3 

Similarly, a searching discussion of administration in the field of munici- 
pal public works makes this generalization: 

The successful management and control of any large enterprise re- 
quires carefully prepared plans which seek to forecast its future opera- 
tions as accurately as possible. 4 

These elementary propositions may be illustrated by a simple and famil- 
iar analogy. The construction of a house is first of all a matter of planning. 
There are such fundamental questions to answer as how many and what 
types of rooms, what kind of exterior, what kind of surroundings, the 
special features desired, and the amount which can be spent out of available 

* Galloway, George B. and Associates, Planning for America, New York: Henry Holt, 1941. 

2 See Prince, David E., "Planning for the Future While Producing for Victory," in National 
Conference on Planning, 1942, p. 48 ff. t Chicago: American Society of Planning Officials, 1942. 

3 Holden, Paul E., Fish, Lounsbury S. and Smith, Hubert L., Top Management Organization 
and Control t p. 3, Stanford: Stanford University Press, 1941. 

4 Stone, Donald C., The Management of Municipal Public Works, p. 63, Chicago: Public 
Administration Service, 1939. 



PLANNING AND ADMINISTRATION 123 

resources. The location is then selected, and detailed plans are prepared 
to fit the wants of the owner and the peculiar requirements of the site. 
The architect's blueprints are the starting point for the contractor who 
actually builds the house, who translates purpose into action. Later, the 
house may be outmoded, or may lack the latest developments in heating and 
lighting. It may not be large enough. The income status of the owner 
may change. Then it must be remodeled, or a new house designed and built. 
In all of these phases of providing ourselves with shelter, we practice the 
fundamentals of planning. 

Contribution of Administrative Planning. No informed discussion of 
public administration can fail to give specific attention to the problems of 
planning. In many respects these problems are common to all phases of 
administrative activity they involve organizational structure, personnel, 
personalities and relationships between units of an organization. The rea- 
sons for isolating the subject of planning for special mention as the opening 
chapter of this part on organization and management should therefore 
be obvious. When we talk about the problems of public administration 
we look toward the techniques and processes involved in carrying out the 
programs of government. But we must never lose sight of the fact that 
we begin with the program, with the work our government desires to accom- 
plish. Our primary interest may be confined to the process of performance, 
yet that process is important only if it attains the purpose or end of admin- 
istrative activity. Sometimes students of administration become so pre- 
occupied with procedures and processes that they foget what is of first 
importance the results of these processes. 

By beginning our treatment of organization and management with the 
subject of planning, we are acknowledging that our first concern is with 
results. For, as we said earlier, planning is preparation for action. It is a 
particular phase of management, which must continuously deal with defin- 
ing end and purpose, with setting the goals to be realized. Administrative 
performance can be measured only in terms of the extent to which these 
goals have been achieved. As one of the processes of administration, plan- 
ning deserves emphasis because of its tremendous influence upon all admin- 
istrative activity. The more carefully the plans are prepared, the less waste 
will appear in accomplishment. The more comprehensive the plans, the 
less day-to-day improvisation will be necessary and the fewer crises will 
occur. The more adequate our plans, the surer we will be of accom- 
plishing our purpose. 

In reviewing the quality of any administrative agency, the analyst today 
usually begins with these questions: "What steps are taken to define the 
purpose and objectives of the agency? Is there a plan of action? How 
comprehensive is the plan? Is the program reviewed from time to time?" 
These and similar questions are vital because all other problems including 
problems in structural arrangement, budgeting, personnel, reporting, and 



124 PLANNING AND ADMINISTRATION 

worMhig relationships must be examined in the light of their influence 
upon realizing the plans of the agency. 

Planning and Legislation. Just what kind of planning does an admin- 
istrative agency do? What about the role of the legislature in our scheme 
of government? For one thing, in recent years the advance planning of the 
broad objectives of national action has become more and more a function 
of the executive branch of our government. To such planning all adminis- 
trative agencies contribute. The same tendency has developed in state 
and local governments. 5 The legislature today reviews, criticizes, and modi- 
fies the plans prepared by administrative agencies under the coordinative 
responsibility of the chief executive. The greater prominence of this pro- 
cedure since 1933 has not resulted from any peculiarities of the New Deal, 
but from the conditions of dynamic government confronted with more and 
more problems requiring national action problems ranging from unem- 
ployment to war. 

Increasingly the role of the legislature is one of criticism rather than of 
formulation. For many reasons, we have found that legislatures by them- 
selves are not in a position to formulate broad programs of action. This, 
of course, does not mean the inevitable destruction of democratic govern- 
ment. Even when administrative agencies do the planning, the final author- 
ity to approve or disapprove each proposal remains a legislative function. 
This is a very real and essential authority, not to be disparaged. 

Planning and Administration. In addition to the need for administrative 
agencies to plan broad objectives for legislative consideration and sanction, 
there is the need for planning the details within the legislative framework. 
Frequently legislatures set forth their will in very general terms. The dif- 
ferences of opinion among lawmakers and the pressures of various groups 
converging on a legislature often prevent agreement except upon certain 
main purposes. The details, or the refinements, are left to be worked out. 
Such wartime problems, for example, as the size of Army and Navy, the 
composition of the military forces, and the type of weapons and equipment 
needed were left for administrative determination. They required careful 
planning. 

Then, in the third place, there are the administrative plans in a more 
specific sense, the programs of work laid out to achieve the objectives finally 
agreed upon. These administrative plans may include the budget, the 
organization structure, and a time schedule of work accomplishment. This 
is preeminently a job of administration. It should never be attempted on 
the legislative level. 

Interrelation of Planning Activities. All these types of planning are 
closely related. The interplay of administrative planning, review of present 
programs, and formulation of new objectives goes on all the time. Often 

5 Sec, for example, the experience in New York State as set forth by Scott, Elisabeth M. 
and Zellcr, Belle, "State Agencies and Lawmaking," Public Administration Review, 1942, Vol. 
2, p. 205 ff. 



PLANNING AND ADMINISTRATION 125 

a sense of the desired goals of administrative action is developed ouf$f the 
work of an agency. We have on occasion established agencies with the 
expectation that they will develop plans for action and obtain legislation 
for a desired program. This was true, for instance, in the field of price 
control during World War II. 

It must be repeated planning presupposes no particular set of objectives, 
nor any one conception of political values. Just as budgeting in and of 
itself does not mean large outlay or small outlay, revenues balanced with 
expenditures, or deficit spending, so planning does not necessarily mean 
either a collectivist or a laisscz faire economy. There has been much con- 
fusion on this score in recent years. The attention given the succession of 
Five-Year Plans in the Soviet Union seems to have suggested to many that 
planning and communism are synonymous. The discovery that Hitler's 
Germany also planned in a similar way merely broadened the association 
to include all totalitarian forms of government. 

Those who would insist that planning is incompatible with our form 
of government not only appear to contend that democracy is planlessness 
but also show themselves little versed in American history. It has often 
been pointed out that Alexander Hamilton's First Report on Public Credit 
in 1790, two other public reports presented in that year, and his great Report 
on Manufactures in 1791 were all planning documents of the first impor- 
tance. These were just the beginning of planning by the new American 
government planning that has been continuing ever since. 

The furor about planning is caused by disagreement over objectives 
and methods. Debate is desirable in a democracy. But it should not suggest 
that planning in itself is undesirable. We may weigh specific plans; but 
we should be agreed that planning is necessary and vital in public admin- 
istration. 8 As a problem in administration, distinguished from the man) 

8 As long as we have government and administrative agencies, we must have planning. 
This planning may be of two types: it may be concerned with new programs and new 
activities to meet particular problems demanding governmental atcnuon; or it may be concerned 
with the progrrms for carrying out broad objectives already set forth in legislation. The second 
type of planning in particular is absolutely indispensable to efficient administration. The first 
type is closely related to fundamental issues of public policy, and the eventual decision must 
be made by the chief executive and the legislative body. This type of planning is intended 
to facilitate the selection of choices by those responsible for public policy. 

There have been recently several vigorous denunciations of "planners." See particularly 
Mises, Ludwig von, Bureaucracy, New Haven: Yale University Press, 1944, and Hayek, 
Friedrich A., The Road to Serfdom, Chicago: University of Chicago Press, 1944. The real 
object of attack in these volumes is a government policy which seeks positively to influence 
the operation of our economic system. Such policy is identified as government economic 
planning, and immediately suggests to the authors that all planners are engaged in promoting 
government control of prices, production, service industries, and capital formation. Actually, 
the authors are attacking certain governmental policies. The debate accordingly should be 
confined to these policies, and should not degenerate into name-calling directed against ill- 
dentificd "planners. 1 * 

It should perhaps be repeated that no existing duties assigned to the executive branch of 
the government can be carried out efficiently without planning. The discussion here does not 
concern one set of policies versus another set; it is concerned with the common problems 
involved in any type of planning by administrative agencies. 



126 PLANNING AND ADMINISTRATION 

problems in the various substantive fields of planning, there are several 
aspects of planning as a process which deserve consideration. Let us take 
these up in their proper order. 

2. THE MACHINERY FOR PLANNING 

The organizational means for performing the planning task are not 
easily devised. (Since preparation for action is the very essence of adminis- 
tration, it is scarcely possible to segregate planning as a single act, different 
from all other work. In dividing responsibilities, an administrator cannot 
say, "Planning is assigned to this particular branch." Planning in one form 
or another goes on at all levels of an administrative organization. Almost 
the entire personnel contributes in some way to the preparation of objectives 
and programs.) 

(Yet, considering the task of planning as a phase of management, admin- 
istrators have often found it convenient and desirable to establish some unit 
to which they may look principally as their adviser on planning.) As enter- 
prises get larger, a need is felt for some place where various plans can be 
assembled, reviewed, fitted together, and adjusted to one another. There 
is also a need for some particular officer or unit to lay out the common 
proceduresand the common assumptions upon which planning is to 
be based. 

Federal Improvisation. Until 1934, no planning agency as such was 
attached directly to the President. Planning carried on within the govern- 
ment was parceled out among the various agencies. In general, each agency 
was responsible for preparing plans related to its work. Sometimes a single 
department was given broad planning responsibilities. Thus, the National 
Defense Act as amended on June 4, 1920, provided that the Assistant Sec- 
retary of War should assure "adequate provision for the mobilization of 
material and industrial organizations essential to wartime needs" (Sec. 5a). 
This served as the basis for building up what amounted to a national plan- 
ning staff on economic mobilization within the War Department. 

In theory, the Cabinet was supposed to be an agency for debating and 
advising the President on major questions of policy. From such evidence 
as is available we know that it seldom reached such lofty stature. It was 
not equipped to do so. Presidents had their confidential advisers, who were 
in effect their planners. Occasionally, too, special committees and agencies 
were created to propose specific programs. One of these was the Committee 
on Economic Security, set up in June, 1934, whose report early in 1935 pre- 
ceded the enactment of our social security legislation. The Federal Em- 
ployment Stabilization Board was created by act of Congress in 1931 to 
plan governmental programs for promoting employment during the down- 
swing of the business cycle. This board was abolished in 1933. The Na- 
tional Commission on Law Observance and Enforcement was another 
agency specifically created by act of Congress. It was entrusted in 1930 



PLANNING AND ADMINISTRATION 127 

with the task of reviewing the whole system of federal justice and planning 
improvements, embodied in a series of 14 reports. However, no continuing 
organization was provided until 1934 to meet the need for a central plan- 
ning agency under the chief executive. 

National Resources Planning Board. On June 30, 1934, by Executive 
Order No. 6777, President Roosevelt established the National Resources 
Board composed of five members of his Cabinet, the Federal Emergency 
Relief Administrator, and three prominent citizens. A small staff was pro- 
vided. This new agency was in a sense a continuation of a planning board 
created by the Administrator of the Federal Emergency Administration for 
Public Works. The new board's report of December 1, 1934, stated that for 
the "first time in our history" exhaustive studies on land use, water use, 
minerals, and related public works had been brought together. The basis 
was laid for a "comprehensive long-range national policy for the conserva- 
tion and development of our fabulous natural resources." In 1935, the 
National Resources Board was reconstituted as the National Resources Com- 
mittee with virtually the same membership. 

In its report of January 8, 1937, the President's Committee on Adminis- 
trative Management declared: 

The President must be given direct control over and be charged with 
immediate responsibility for the great managerial functions of the gov- 
ernment which affect all of the administrative departments. . . . These 
functions are personnel management, fiscal and organizational manage- 
ment, and planning management. Within these three groups may be 
comprehended all of the essential elements of business management. 

The President's Committee recommended that a National Resources Board, 
composed of five members without salary and with indefinite terms, be 
created to serve as a central planning agency under the chief executive. 
After the passage of the Reorganization Act of 1939, the President in Reor- 
ganization Plan No. 1 of April 25, 1939, provided for a National Resources 
Planning Board. The Emergency Relief Appropriation Act of 1939 specified 
that the board should be composed of three persons "from widely separated 
sections of the United States," appointed by the President with the approval 
of the Senate. The National Resources Planning Board came to an end when 
Congress, in passing the Independent Offices Appropriation Act of 1944, 
refused to include any funds for its operations, and specifically directed that 
no other funds were to be made available for its continuance by the 
President. 

This experience with a central planning agency in the federal govern- 
ment underscored the difficulties which are likely to beset such a unit. One 
essential condition for the successful operation of a planning agency is 
close and personal relationship with the chief executive. The planners must 
have his full confidence and must intimately know his mind. It is doubt- 
ful whether any board can ever develop such relationships. Especially 



128 PLANNING AND ADMINISTRATION 

would this be impossible when a board is torn by internal persona] 
jealousies or disagreements. Moreover, the planning agency must also be 
linked to operations if its proposals are to be more than long-distance 
platitudes, and if its usefulness is to be apparent to legislators. Then, too 
the planning agency must be used. For example, although the National 
Resources Board was set up by the President as early as June, 1934, it 
played no part in planning the most important single program of the federa 
government from 1933 to 1940 the emergency work program begun b) 
the Emergency Relief Appropriation Act of April 8, 1935. Indeed, the stor) 
of planning this great program is a fascinating example of how a govern 
ment undertaking is prepared and put into operation. It has been told ir 
full elsewhere. 7 

Office of War Mobilization and Reconversion. Before the Nationa 
Resources Planning Board was abolished, a new type of planning agenq 
was already in process of development. This was the Office of War Mobili 
zation, which was created by Executive Order No. 9347 of May 27, 1943 
Ostensibly a coordinating device for the many wartime programs such aj 
those of the War Production Board, Office of Price Administration, Wai 
Food Administration, National War Labor Board, and the War and Nav) 
Departments, the new office also became implicitly a central planning 
agency. It was under its auspices that Bernard Baruch and John Hancock 
submitted their Report on War and Postwar Adjustment Policies. The 
preparation of legislation on disposal of surplus property and on the settle 
ment of terminated contracts was sponsored by this office. The War Mobili 
zation and Reconversion Act of October 3, 1944, placed the Office of Wai 
Mobilization and Reconversion on a statutory though temporary basi: 
and entrusted to it important planning responsibilities. 

In several respects the Office of War Mobilization, especially in it 
original form, suggested a device superior to the National Resources Plan 
ning Board. It was headed by a single individual with close relationshif 
to the President. It was concerned with immediate programs and policie: 
as well as with the preparation of future programs. There was little doub 
about its contribution to war and postwar administration, even thougl: 
not all of its potentialities were realized. 

New Yorl( City Planning Commission. A different kind of planning 
organization was set up in New York City by the charter adopted ir 
1936. Effective on January 1, 1928, this charter provided for a City Planning 
Commission of seven members, one of whom ex officio was the chief engi 
neer of the Board of Estimate. The other six members were to be appointee 
by the mayor for terms of eight years. Members could be removed by th< 
mayor only on proof of official misconduct, negligence, conduct discrediting 
the office, or mental or physical inability; a formal hearing was requirec 

7 Sec Macmahon, Arthur W., Millett, John D. and Ogdcn, G., The Administration o. 
Federal Wor\ Relief, csp. chs. 1-3, Chicago: Public Administration Service, 1941. 



PLANNING AND ADMINISTRATION 129 

before removal. Salaries o the members were not to be reduced during 
their tenure. The recommendations of the City Planning Commission on 
zoning regulations, the city map, and land subdivisions became effective 
unless set aside by a three-fourths majority of the Board of Estimate. 
Finally, the commission prepared the capital expenditure budget of the city 
for adoption by the Board of Estimate and the municipal council. The 
Board of Estimate might include a project in the capital budget to which 
the City Planning Commission was opposed only by a three-fourths majority. 
The municipal council could strike out a capital item but could not increase 
one or add new ones. 

Thus in several ways the charter-makers sought to provide an independ- 
ent type of planning agency for city affairs. The reasons are best 
summarized in the words of the framers of the charter themselves: 8 

The primary purpose of such a commission is to guide and to influence 
the city in its development and future growth. The growth and devel- 
opment of a modern city depend upon the wisdom and foresight with 
which capital improvements are undertaken and the extent to which the 
integrity of zoning regulations and of the city map is maintained. Unfor- 
tunately, such expenditures too often have been undertaken because ot 
local and special pressures and without relation to the interests of the 
city as a whole. Great waste has resulted and a species of logrolling has 
developed in connection with measures affecting local or special inter- 
ests. Such evils inevitably occur in representative government when sev- 
eral representatives of separate constituencies may join in supporting 
measures of local or special interest affecting their several constituencies 
or followings. But such evils are not to be cured by abolishing repre- 
sentative government, or by substituting one representative body for 
another. They should be controlled by publicly confronting the repre- 
sentatives with the interests of the public at large. Too often such inter- 
est finds no advocacy because the local political or special interest is 
organized and the general interest is not. 

It is therefore proposed to create a responsible, independent commis- 
sion concerned with the welfare of the whole city, to advise and report 
upon all questions affecting the growth of the city, including the expen- 
diture of capital funds, changes in zoning, and changes in the city 
map. . . . The commission will report its conclusions for the considera- 
tion and action of the Board of Estimate. All proposals for improve- 
ments or for changes in the city map or zoning regulations must first 
be referred to the Planning Commission. If approved, the Board of 
Estimate may adopt them by majority vote; if not approved, twelve 
affirmative votes [three-fourths] are required. Thus the Board of Esti- 
mate, consisting of the elected representatives of the people, is given the 
final decision as to the projects to be adopted, but the function of plan- 
ning and recommendation is given to a nonpolitical, full-time body 
whose decisions cannot be lightly overriden. 

Here was an attempt to create a rather independent planning commis- 

8 Preliminary Report and Draft of Proposed Charter for the City of New Yor%, pp. 8-9, 
New York: New York City Charter Revision Commission, 1936. 



130 PLANNING AND ADMINISTRATION 

sion. Undoubtedly this effort was prompted in large part by the nature of 
the responsibility entrusted to the commission planning and control of 
land use. The drafters of the city charter sought a means to prevent the 
many abuses in land use which had previously occurred. But the approach 
proved to be a negative one. When the commission sought to lay out a 
comprehensive zoning regulation, the political authorities of the city were 
not prepared to accept the program and fundamental modifications were 
necessary. 9 Thus need for political leadership in planning was well demon- 
strated. The independent commission was not as independent in accom- 
plishing its mission as might have been expected. 

Departmental Planning Units. Within the main agencies of the federal 
government, several department heads have found a need for at least an 
individual adviser to help in the preparation of departmental plans. 10 In 
some departments yet another step has been taken the establishment of a 
planning office. If a department is to play its role as an integrating force 
for the operating establishments composing it, strong central planning 
machinery is necessary. Secretary Elihu Root perceived this need for the 
War Department after the Spanish-American War. His efforts led to the 
creation of the position of Chief of Staff and the establishment of the Gen- 
eral Staff in 1903. More recently the Department of Agriculture took a 
similar step by making its Bureau of Agricultural Economics a central 
planning unit. 11 

There are a number of organizational problems connected with plan- 
ning. Shall the planning agency be headed by a single individual or a 
board? Shall the planning agency be a single adviser or a fairly sizable 
office? Shall it be closely tied to the chief executive or department head, 
or shall it be given some kind of protected status to encourage what has 
been called an independent point of view? The answers which modern 
proponents of administrative management would give are clear. Leader- 
ship in planning is a responsibility of the chief executive or department 
head. The administrator needs planning assistance which can best be af- 
forded by a single individual as head of an adequate planning unit. Only 
in this way can planning contribute its full potentialities to efficient 
administration. 

3. PLANNING VERSUS OPERATIONS 

' Opportunities for Conflict. Forty years ago, Elihu Root spoke of the 
"eternal issue of planning versus administration." The question is indeed 

9 Sec Tugwell, R. G., "Implementing the General Interest," Public Administration Review, 
1940, Vol. 1, p. 32 ff. 

^See Macmahon, Arthur W. and Millctt, John D., Federal Administrators, ch. 4, New 
York: Columbia University Press, 1939. 

^Gaus, John M. and Wolcott, Leon O., Public Administration and the Department of 
Agriculture, p. 311, Chicago: Public Administration Service, 1940. The most comprehensive 
study of the military prototype is Nelson, Otto L., National Security and the General Staff, 
Washington: Infantry Journal Press, 1946. 



PLANNING AND ADMINISTRATION 131 

eternal; no ready solution is available today any more than four decades 
ago. In its essence, the problem has two phases. One is the relationship 
of planning to operations, or of planners to administrators. The other is 
the relationship of plans to action. 

There is apt to develop in any agency the attitude among subordinate 
operating units that the staff personnel at superior levels spends its time 
developing programs which prove impractical in execution. The complaint 
may in reality be based on failure of consultation and explanation. Of one 
thing there is little doubt; all plans must be closely geared to operations. 
They must be realizable; and that means capable of execution by the oper- 
ating units. It is a matter of personal relations as well as of effective 
management for planning staffs to maintain continuing contact with 
operating personnel to know their problems, seek their advice, and review 
proposed programs prior to action. 

Tasf( of Progressive Management. It is a fairly good rule, and one that 
should be generally observed in administrative practice, for a central plan- 
ning agency in municipal, state, or federal government, or even in a large 
department, to do as little direct planning as possible. The central unit 
should stimulate and review; it should experiment with new techniques 
and devices; it should cover subjects not within the scope of subordinate 
units. For other activities, there are reasons of expediency and efficiency 
which urge that subordinate operating agencies or units be encouraged tc 
do the bulk of necessary planning. It is an indication of poor management 
when cleavages develop between planning staffs and operating officials. 

To be sure, planners are expected to be imaginative, to project bold 
courses of action, to weigh all possible alternatives. Operating officials may 
have their horizons more narrowly limited to their immediate concerns 
Frequently they may let reasons of convenience sway them against a pro- 
posed line of action because it may mean more work for them. These 
are dangers that must be guarded against. On the other hand, it is vitall) 
important that all operating obstacles be clearly understood before a parti 
cular policy or program is adopted. Such difficulties can be most readilj 
forecast by those having operating responsibilities. Thus a balance musi 
always be sought between broadly conceived goals and the practical limita 
tions of ways and means. This is just another way of saying that th( 
gulf between planning and operations must be bridged by progressiv< 
management. 

Planners as Administrators. The other phase of the issue between plan 
ning and performance concerns the execution of well-laid plans. Specifi 
cally, should planners become the administrators of their plans whei 
adopted? Here again no categorical answer is possible. If there is such ; 
thing as an identifiable planning mentality, it may well be that its necessar 
characteristics are different from those required to make a successfu 
administrator. On the other hand, we do observe in certain agencies th< 



132 PLANNING AND ADMINISTRATION 

practice of assigning to a group of men the developing task of long-range 
plans for certain operations. Later, as the time approaches for action, the 
same people are assigned to supervise execution. Under appropriate condi- 
tions, the practice may work satisfactorily. The planners thus become 
the administrative supervisors. 

Yet, when supervisory authority is lodged in the same staff agency that 
exercises planning responsibilities, the planning function may suffer. In 
1942, before he became Deputy Chief of Staff of the Army, General Mc- 
Narney told a Senate committee that the General Staff of the War De- 
partment had taken on so many administrative duties that its planning 
work had suffered in consequence. 12 The answer in this case was to set 
up three great commands to exercise virtually all War Department functions 
i in the United States and so free the General Staff of its burdensome coor- 
dinating job. There is always a danger that a planning unit may find ad- 
Ipnistrative supervision of day-to-day work more tangible and more inter- 
esting than planning. This is especially apt to happen if there is no other 
agency for exercising the necessary measure of supervision. Certain it is 
that ability as a planner is not sure proof of administrative capacity. The 
combination of the two tasks in the same individual or agency is not a 
foolproof method of uniting planning and operations. 

Practical Test of Planning. Plans should be intended for action. When 
approved, and when the necessary funds are made available, a set of plans 
must next be carried out. Action accordingly follows after the planning. 
Much of the success in operation depends upon the thoroughness of the 
plans. And purposeful administrative activity depends upon advance prep- 
aration. There is no inherent conflict between planning and operations. 
The two are inexorably entwined. 

David Lilienthal, chairman of the Tennessee Valley Authority, men- 
tions with some pride that nowhere on its organization chart will the 
student find a Department of Social Planning, and that there is no TVA 
"plan." 13 Yet he admits that TVA is a planning agency. "The TVA idea 
of planning sees action and planning not as things separate and apart but 
as one single and continuous process." 14 Mr. Lilienthal goes on to argue 
that the development of a region is a course of action. He acknowledges 
that TVA has made many plans, but he also emphasizes the authority's 
responsibility for action in the following words: 

In the TVA the merging of planning and responsibility for the carry- 
ing out of those plans forces our technicians to make them a part of the 
main stream of living in the region or community; this it is that breathes 
into plans the breath of life. For in the Tennessee Valley the expert 
cannot escape from the consequences of his planning, as he can and 

12 Senate Committee on Military Affairs, Hearings on a Bill to Establish a Department of 
Defense Coordination and Control, p. 13, 76th Cong., 2nd Sess., March 6, 1942. 

* 3 Lilienthal, David E., TV A Democracy on the March, p. 192, New York: Harper, 1944. 
U MM/., p. 199. 



PLANNING AND ADMINISTRATION 133 

usually does where it is divorced from execution. This has a profound 
effect on the experts themselves. Where planning is conceived of in 
this way, the necessity that experts should be close to the problems with 
which they are dealing is evident. 115 

Planning Through Action Agencies. Mr. Lilienthal is not arguing 
against planning. Rather, he is emphasizing that planning should be done 
by action agencies or action units. His position is a strong one. His 
case can be applied to a large department as well as to TVA in its rela- 
tions to the government as a whole. There is good reason indeed why the 
primary responsibility for the preparation of plans should be placed upon 
operating officials. But usually they will need to have specially designated 
personnel to develop the plans. And all the plans must be put together as 
a whole. 

Although Mr. Lilienthal does not say so, we may presume that the TVA 
board and its general manager found that they themselves could put the 
plans of operating officials together. Hence there was no need for central 
staff planners in TVA. Nor does Mr. Lilienthal deny that TVA plans 
must in the long run be made to harmonize with the plans of the federal 
government as a whole. However, it is advantageous and desirable to 
leave a maximum measure of planning responsibility to operating agencies 
or units, and to encourage close relationships between planning specialists 
and those who will direct the execution of plans. 

4. THE REQUIREMENTS OF PLANNING 

Long-Range Versus Short-Range Planning. The question of whether to 
place emphasis upon long-range or short-range planning is very similar to 
the issue of the relation of planning to operations. Students of administra- 
tion have noticed a tendency in many agencies to concentrate attention 
upon matters of short-range concern, to the exclusion of any interest in 
longer-range goals. No doubt this practice reflects in part the interest of 
administrative officials in action; they want to see something happen and 
soon. It also discloses a natural responsiveness to legislative attitudes; 
lawmakers do not look with fond eyes on long-range planning by the 
executive branch. Furthermore, it reveals that the postponement of thought 
about long-range goals may often result from the pressures of the current 
job. 

This kind of tendency can arise even in a planning agency. For exam- 
ple, the New York City Planning Commission had a Division of Master 
Plan with two main duties: first, long-range concern with the future physi- 
cal improvement of the city; second, the current job of preparing reports 
on proposed building sites for immediate construction, reviewing assessable 
improvements, and commenting on the proposed sale of city properties. 
The staff of the division was not large enough to permit adequate efforts 

15 //., p. 201 (by permission of the publisher). 



134 PLANNING AND ADMINISTRATION 

on both jobs. As a result, the current work was done, and the long-range 
planning neglected. The eventual solution in this case was to take on one 
additional engineer to routinize the current work by devising "stock" com- 
ments and forms, and to set up a separate section to concentrate upon the 
long-range master plan. Isolation of the long-range planners was avoided 
by short, informal staff conferences held each day within the division. This 
change evidently achieved the desired results. 16 

Ideally, there should be no conflict between short-run and long-run 
planning. The two again are interrelated. Short-run plans must be part 
of a long-range objective, if the work when accomplished is to have any 
meaning. A new, wide street laid out to the edge of a city, built to haul 
much traffic, will be of little use unless it is connected with main roads and 
unless the city grows in that direction. A plan for the expansion of a 
manufacturing plant will be of little value unless there is a sustained 
market demand for the product when made. There is no point in develop- 
ing harbor facilities unless there is also a longer-range plan for moving 
increased tonnage through the port. 

At the same time, the determination of short-run programs is the 
occasion for reviewing the adequacy of long-range plans and for modify- 
ing them to meet current conditions. The desirable connection is exempli- 
fied in current capital-budgeting practices in our more advanced cities. 
The usual practice is to adopt each year an annual program of capital im- 
provements, but simultaneously to furnish a plan for desirable improve- 
ments over the next five years. Each year a current program is presented, 
and another year added to the long-run plan. The National Resources 
Planning Board followed the same practice from 1940 to 1942 in presenting 
a six-year program of construction to be undertaken or financed by the 
federal government. Generally speaking, it is the task of competent manage- 
ment to make certain that a proper balance is maintained between short-run 
and long-run planning. 

Planning Personnel. The president of a large company once remarked 
that there are only a few men in any organization to whom planning re- 
sponsibilities can be entrusted. Most people, he observed, are frightened 
when asked to look ahead and prepare for future activities. In other words, 
this executive was convinced that there was a special type of personnel best 
suited for planning. 

Unquestionably, there are certain attributes which are desirable in a 
planner. He must be imaginative, broad-visioned, willing to explore new 
and unusual conceptions, free from prejudice about basic goals. He must 
be objective, thorough, flexible. He should be willing to canvass alterna- 
tives and forecast probable results without extravagant optimism or pessim- 

16 See Boemi, A. Andrew, "Organization o a City Planning Department for Current and 
Long-Term Activities," Report No. 21, Case Reports in Public Administration, Vol. I, Chicago: 
Public Administration Service, 1940. 



PLANNING AND ADMINISTRATION 135 

ism. He must have technical competence in his field of work. He must 
not be afraid of details. He must have a mind which quickly perceives 
interrelationships between various programs of action, and fits pieces to- 
gether into a harmonious whole. He must be able to get along well with 
others throughout the organization. In other words, he must be a good 
staff officer. All these characteristics are desirable in planning personnel. 

To be sure, it is easier to state these general qualifications than it is to 
measure them. In large part, the personality traits just described can only 
be judged subjectively. A chief executive or administrator will have to 
decide which prospective candidates possess the desired combination of 
characteristics for staff leadership in planning. This is merely a way of 
saying that few selections by an administrator are more important to the 
success of his enterprise than the designation of his chief planner. It is a 
vital choice, and not one to be made hastily or casually. 

Because planning is so intimately allied with questions of major policy 
and decision, it is frequently believed that the planners must necessarily 
be political officers. Presidents and department heads are usually expected 
to draw their close advisers from among their personal confidants or politi- 
cal associates. This practice has its advantages. It brings new backgrounds 
and points of view into the public service. It often helps to ensure loyalty 
and full trust between the administrator and his advisers. 

The defects in this practice, however, are equally obvious. The new- 
comer must take a long period to become fully acquainted with the agency 
where he is assigned. He must learn the full impact of present programs 
and the probable repercussions of change. More than this, he must be able 
to command positive reactions all the way down the administrative hier- 
archy. He has to be very sure of himself and well versed in administrative 
practices to achieve so much. 

If the administrator seeks his planning advisers from within the ranks 
of the permanent civil service, he will gain the advantage of having indi- 
viduals with a full knowledge of personalities, programs, and problems 
peculiar to the particular department. Today, in the federal government 
and in most states, our departments are so large that many different points 
of view and types of individuals are to be found within them. It is likely 
that an agency head can find, without too much difficulty, the civil servant 
upon whom he will be willing to rely heavily as a planning adviser. 

Yet if a civil servant is to fill such a position, he must inevitably associate 
himself with the policies of his chief. When those policies are changed 
by a successor, the planner is likely to go too. Must the price for direction 
of planning activities be eventual severance from the public service? It 
would seem desirable to develop some arrangement whereby civil servants 
might hold higher posts like this under one political leadership and in case 
of change be returned to their earlier duties or other responsibilities. For 
instance, it was found a few years ago that the Post Office Department was 



136 PLANNING AND ADMINISTRATION 

largely managed by the deputy assistant postmasters general and the chief 
inspectors, who were drawn from the ranks of the department but who 
tended to shift with changes in departmental leadership. 17 When replaced, 
a deputy assistant postmaster general went back to his previous position. 
While this arrangement had its defects, it might serve as a precedent for 
application to planning personnel. 

Another question is whether special efforts should be made through 
civil service procedures to recruit specialized personnel specifically for staff 
work in planning agencies. The answer would appear to depend upon the 
characteristics of individual agencies. If the tendency for public agencies 
to seek young technicians in many different fields for operating and man- 
agement jobs should continue, there would be no reason to advocate any 
special approach for the recruitment of planning personnel. The scope of 
the professions now recognized in the merit system should be sufficient to 
meet planning needs. We must remember that planning is a management 
function; it is a technique, a method, an attitude. It is not some special 
body of knowledge. Planning is performed as a phase of operations in 
various fields. We should continue to seek general professional competence 
first, and then look for the individual with the peculiar personal qualifi- 
cations and inclinations which make him suitable for the planning staff 
of an agency. 

Planning Techniques. Research and planning are not synonymous; 
rather, the two are complementary. Careful collection of all available in- 
formation and analysis of past trends usually precedes the formulation of 
future action. Planning is this second step the formulation of future 
action to attain desirable ends. 

One method of procedure in planning is to begin with certain standards 
of attainment in a particular field. If a standard is available, it may be used 
as a measuring rod in determining what we have as contrasted with what 
is desirable. The difference, or "gap," is an indication of what we have to 
do. The final step is to lay out a program for achieving the desired stand- 
ard. Another way of stating the same procedure is: (1) to determine the 
objectives; (2) to measure the distance between the present status and the 
objectives; (3) to determine the program for realizing the objectives. 

In its last year, the National Resources Planning Board experimented 
with the latter approach in several different fields. For instance, the stand- 
ard of nutritional need was used as a guide to land-use planning in agri- 
culture. The objective was an American population provided with an 
adequate and properly balanced diet. The science of nutrition had reached 
a point where it could say with precision what an adequate and balanced 
diet is. Diet needs per individual for different types of food, multiplied 
by total population, gave the objective in quantitative terms. This objec- 

17 See Macmahon and Millctt, op. cit. in note 10, p. 36. 



PLANNING AND ADMINISTRATION 137 

tive in turn was translated into acreage requirements. Required acreage 
compared with existing acreage indicated broadly the "gap" to be bridged 
in obtaining agricultural production for an adequate food consumption. 

The same approach was used for public libraries. With the assistance 
of the National Resources Planning Board, the American Library Associa- 
tion undertook to formulate standards for public libraries. 18 Comparison 
of existing library service with these standards supplied a basis for prepara- 
tion of a program to realize the standards. 

The principal mechanism of urban land-use planning has long been 
the master plan, which is designed to present the current conception of 
long-run city development. More specifically, it presents an estimate of 
needed capital improvements. This means, of course, laying out the ex- 
pected population growth and shifts within a city, and then providing the 
facilities to meet the anticipated needs. It implies some standard for in- 
dicating needs in schools, parks, fire houses, streets, sewers, water mains, 
and all other municipal facilities. 19 The master plan also shows all existing 
public structures. In short, it is expected to provide the basic data for a 
capital-improvement budget for a city. Unfortunately, few cities in the 
United States have ever developed even a good approximation of a master 
plan. Much improvisation still passes as city planning. 

For many years the United States Forest Service has used a forest man- 
agement plan as its basic planning program. Under this program, each 
supervisor of a forest keeps an up-to-date local forest-management plan for 
his area. This plan divides a forest into working circles. For each circle 
there are data about topography, number of trees, and rate of growth. 
The plan then indicates the silvicultural system or the genetics and ecology 
of tree growth, the timber yield, the policy on timber sales, the selection 
of areas to be cut, and the annual permissible cut. The forest management 
plan became the basis in turn for a regional management plan, which was 
incorporated into a national management plan. Thus the Forest Service de- 
veloped a program for its work in forestry operation. 

There are various techniques for planning, but they have in common 
the collection of relevant data on which to build a program for realizing 
specified objectives. Whatever techniques are employed, planning must 
look forward; it must propose desirable action. The more concrete and 
detailed the program, the better has been the planning. And this means 
inevitably more efficient administration. Studies in themselves are not 
plans. The planning job is not done until specific and detailed programs 
have been worked out. The plans should be in such condition that operat- 
ing officials could begin immediately to carry them out. 

18 Sec Postwar Standards for Public Libraries, Chicago: American Library Association, 1943. 

10 See, for example, "Preliminary Report of the Committee on Park and Recreation 
Standards," in Planning, 1943, p. 106 ff. t Chicago: American Society of Planning Officials, 
1943. 



138 PLANNING AND ADMINISTRATION 

Public Relations of Planning. The final problem of planning is getting 
the program across. As we saw, planning is a responsibility of the top 
administrator. It is his duty to present the program to the chief executive 
and to the legislature. He is the advocate. The technicians who may have 
prepared the data are only members of his staff. 

Yet the administrator must naturally be concerned about the public re- 
percussions of a program he accepts. This has led many planners to feel 
that they must themselves cultivate outside sources of support. Certainly 
it may be contended that planners should consult many different groups 
in framing proposals. A sense of participation may encourage some in- 
dividuals and groups to endorse later plans. There is much room in the 
planning process for advisory committees as well as for extensive consul- 
tation with citizen and interest groups. 

Some chief planners have found it desirable that they themselves serve 
as intermediaries between their technical staffs and the public. They have 
feared that their "experts" might frighten or upset the average citizen or 
legislator. So they have been the filters for presentation of data and pro- 
posals to the outside. There is much to say for this practice. Chief planners 
must also supply the links between their technicians and the political head 
of the agency a task requiring considerable skill in communication and 
interpretation. 

Planning, viewed from the angle of its concrete end-product, leads to 
a selling job. The planning personnel must be prepared to help in the 
process of sale. The burden of getting programs accepted cannot be left 
solely to the responsible political chief. While the planner must make it 
clear that he is not the official responsible for determining policy, he must 
assist in showing the grounds which make a program desirable. It follows 
that for many reasons planners, because they are planners, cannot afford 
to ignore the public-relations problems inherent in their job. 

Summary. Preparation for action is a vital indeed an indispensable 
part of administration. It is the first responsibility of management. Many 
other phases of management must flow in turn from planning. Particu- 
larly, budgeting is very closely tied to planning, for the budget is merely the 
fiscal expression of work plans. 20 Organizational planning follows the 
tasks laid out for an agency. Planning covers many fields conservation of 
natural resources, land use, public works, economic development. An ad- 
ministrator, to perform his planning responsibility, must have the necessary 
staff whose head works in close personal relationship with him. Planners at 
the higher levels in the administrative hierarchy have a management job 
to do. They have to stimulate planning by other staff and operating agen- 
cies or units, in order to ensure that plans are in balance, that synthesis has 
been achieved, and that all aspects have been fully considered. Planners 



20 See Walker, Robert A., "The Relation of Budgeting to Program Planning," Public 
Administration Review, 1944, Vol. 4, p. 97 ff. 



PLANNING AND ADMINISTRATION 139 

must prepare plans themselves in those fields where there is no operating 
agency. Planning and operations should not be regarded as being antag- 
onistic. Rather, they should be considered as interlocking and as repre- 
senting succeeding phases of administrative activity. So also short-range 
plans should be carefully geared to long-range objectives. Planning tech- 
niques should be designed to lay out work programs for meeting deter- 
mined goals. Capital budgets and current operating budgets should be 
phases of these techniques. 

Personnel engaged in planning should be carefully selected for technical 
competence and ability to think ahead in original projections. Planning 
requires careful definition of objectives, wherever possible in quantitative 
terms, on the basis of an inventory of present status and resources and aim- 
ing at a program for realizing these objectives. Consultation with various 
interested groups is an essential part of this process. Well-defined object- 
ivesa clear comprehension of goals means purposeful administration 
accompanied by the least possible loss in wasted effort. 



CHAPTER 

7 

Working Concepts of Organization 

1. THE ARCHITECTURE OF ORGANIZATION 

Terminology. Organization is the method of dividing up work. It 
rests upon two basic conditions. First, organization implies that there is 
a job to be done. Second, division of work becomes necessary only when 
a number of individuals are involved in accomplishing a particular job. 
In a relatively simple situation, organization may be informal and even 
implicit. It may depend upon tradition or habit. As the job becomes larger, 
as the purpose becomes more complex, as the number of people performing 
the job increases, organization tends to be more exactly defined. 

When we use the word "organization," we shall have in mind a rather 
restricted and particular meaning. We are not concerned with the organi- 
zation of government as a federal republic, or with its legislative, executive 
and judicial branches; here we are not dealing with basic theories about 
political structure. Nor are we touching upon the organization of society 
into family units, social groups, or economic associations. Our concern 
now is with specific work undertaken by government, whether federal, state, 
or local. Many of the considerations to which we have to pay attention 
hence are also applicable to business enterprise, and likewise to undertakings 
such as hospitals and schools. Organization, for our present purposes, 
refers to the structure developed for carrying out the tasks entrusted 
to the chief executive and his administrative subordinates in government. 

It is customary to point out that organization has grown in importance 
with the increasing specialization of individuals. Division of labor, for 
example, was a basic factor in industrialization. We found that productive 
output increased with specialization. But specialization required organi- 
zation, since all effort must add up to the desired output. We do not get 
a suit of clothes unless the cutters use a suit pattern in cutting the cloth 
and the sewers know the particular parts to sew and in what order. If all 
the workers sewed sleeves, there would be no suit. So we must have 
workers who sew sleeves, and others who sew coat seams, and still others 

140 



WORKING CONCEPTS OF ORGANIZATION 141 

who sew the trousers. The work of each must be thus systematically al- 
located in order to achieve the desired product. 

Over the years we have developed a number of definite conceptions 
of the ways in which work can and should be divided. To be sure, we are 
a long way yet from final and conclusive answers to all organizational 
questions. There are differences of opinion about many particular phases 
of organization. There is ample room for experimentation in organizational 
relations. Administrative structure is not static. New ideas bring new 
trends in organization. | Yet there remain certain fundamental concepts in 
organization which all should understand. Phrases like "bases of organiza- 
tion," "unity of command," "hierarchy," "decentralization," "staff and 
line," and "span of control" have rather definite meanings, j It will prove 
useful in the present chapter to review briefly these workmg concepts of 
organization. 

Bases of Organization. Students of organization usually recognize four 
different bases for organizations, in the sense of different methods of dividing 
up a job. These are: function or purpose, process or profession, clientele or 
commodity, and area. 

Function or purpose is fairly easy to define. Education of children 
through a public school system is a particular function or purpose which 
an agency may be established to perform. The conduct of foreign relations, 
the collection of taxes, the operation of a navy, the provision of public 
assistance to the destitute, the disposal of garbage and refuse all of these 
are functional definitions of administrative jobs. Within a particular 
field, too, such as public welfare or social security, the component parts of 
governmental activity may be divided functionally, as between unem- 
ployment insurance and what we used to call relief. On an assembly line, 
in much the same way, the job of putting together an automobile is broken 
up into various functions. The wheels and then the engine are attached to 
the chassis, the body and fenders are added later, and finally the completed 
automobile rolls from the assembly line. Each man along the line has 
performed a particular function, such as fastening on a wheel or connecting 
a driveshaft. 

Functional division of duties or division by purpose is perhaps the most 
common of all methods of promoting specialization. There are many who 
maintain that it is the only efficient method, since it alone prevents dupli- 
cation and conflicts between the work of various individuals. Whether 
this be true or not, functionalization is readily apparent in most large 
organizations. 

Process as a basis of organization is somewhat more difficult to define. 
Often it is identified with a profession such as engineering, or with a tech- 
nique such as accounting. Medical care wherever provided whether 
in schools, in health centers, or in hospitals may be regarded as a process 
rather than as a function. Legal departments in government- federal, state, 



142 WORKING CONCEPTS OF ORGANIZATION 

and local are of a similar character, although they are closely related to the 
function of law enforcement. 

Process or profession is likely to be found more commonly as a basis 
of staff organization than as one of line organization. This is a distinction 
to which we shall return later. It is sufficient here to note that some con- 
fusion results when we try to define process as a basis for allocating work. 
It is not always easy to draw a line between function and process. If a 
distinction does not readily appear, it may be just as well to consider the 
two as one. 

Clientele is much more easily identified as a way of dividing up work. 
The Office of Indian Affairs in the Department of the Interior is a good 
example. This office must provide education, welfare, and other services 
for a particular group the American Indian. The Department of Labor 
also is supposed to recognize a very important clientele, the labor element 
of our population as contrasted with professional and managerial personnel. 
The Children's Bureau is yet another illustration of clientele as the basis of 
establishing a particular organization. A hospital for the mentally ill looks 
toward a particular clientele, as does a school for the blind or deaf. The 
Veterans Administration is a further example. Any analysis of administra- 
tive structure will quickly reveal many instances where clientele has been 
the basis for determining institutional responsibilities. 

Commodity differentiations used for organization are similar to those of 
clientele. In any procurement operation some breakdown by commodity 
may be expected. In the War and Navy Departments, supply activities are 
divided along commodity lines, guns and ammunition being purchased and 
stored separately from construction equipment, aircraft, medical supplies, 
communications equipment, and general supplies. 

Finally, the place where a job is done that is, the area may be a primary 
basis for organizing activities. The geographic factor is very important in 
administration; it will be separately discussed in connection with decentrali- 
zation. By their very title, district offices suggest the geographic definition 
of duties. The Division of Territories and Island Possessions in the Depart- 
ment of the Interior is an establishment that deals with the problems of 
particular areas. Within the War Department structure, the military post 
in the field has long been the center for a number of different activities, all 
tied together by the geographic fact of their location. The Tennessee Valley 
Authority is an outstanding example of an organization established to 
perform several different functions in a designated area. 

Choice of Basis. Enough has been said to afford some general under- 
standing of the different alternatives available for designing organization. 
Each has its advantages, but each presents particular problems. 1 It is 
i For a good summary of the advantages and disadvantages of these bases of organization 
see Gulick, Luther, "The Theory of Organization," in Gulick, L. and Urwick, L., eds., Papers 
on the Science of Administration, pp. 21-30, New York: Institute of Public Administration, 
1937. 



WORKING CONCEPTS OF ORGANIZATION 143 

not necessary to debate relative merits in order to gain a fundamental appre- 
ciation of organizational problems. No one has yet given us conclusive 
evidence that would enable us to say that there is but one best way to 
organize for action. There are as we have seen four different ways, and 
one may present compelling arguments in a given situation. The key lies 
often in the situation, or rather in a thoughtful appreciation of the total 
line-up of relevant factors. 

It is not always recognized that all of these methods of organizing work 
may be employed in one agency, at succeeding levels in the division of 
work. One example may be cited. Under the work relief program of the 
federal government from 1935 to 1942, the first breakdown below the level 
of the national office was geographic by state boundary lines. Status as 
an organizationally separate state was granted to New York City. Within 
this quasi-state office at one time were four so-called operating divisions: 
Operations, Women's and Professional Projects, Employment, and 
Finance. Operations referred to construction projects; in essence this 
entailed a process. Women's and Professional Projects, on the other hand, 
was a division based on clientele, on the type of person employed. Employ- 
ment involved the function of determining who was eligible for work and 
assigning those eligible to various projects. Finally, Finance was largely the 
internal job of keeping project accounts and preparing payrolls for the 
workers. This too could be called a process, or, if we choose, a function. 
Thus a whole criss-cross of organizational patterns was to be found in this 
one agency. 

Nor is such a situation unique. Indeed, we may expect to find it in 
any large-scale enterprise. A combination of organizational patterns does 
not in itself suggest an undesirable or inefficient structure. It may rightfully 
demand careful scrutiny with a view to simplification. However, we can- 
not automatically say that an organization which employs more than one 
basis for its division of duties is a faulty organization. Our analysis must 
be more penetrating and conclusive than that. 

Dynamics and Rigidities. As the United States expanded from east to 
west, and as its population increased sevenfold in one hundred years, the 
work of its administrative agencies likewise expanded. The changing na- 
ture of governmental activities particularly in depression and in war 
brought about a further increase in administrative work. Some work begun 
many years ago has become less important, if not completely obsolete. Both 
aspects of the development entail alterations in organizational structure 
to meet new conditions. Shifts in emphasis usually mean shifts in 
organization. 

Yet there are certain important elements of rigidity in administrative 
structure that should never be overlooked. The history of attempts at gen- 
eral administrative reorganization of the federal government from 1909 to 
date reveals this fact only too clearly. Many agencies have cultivated very 



144 WORKING CONCEPTS OF ORGANIZATION 

close relations with particular interest groups. These groups in turn have 
opposed any move which could be interpreted as tending to diminish the 
importance of their favored agency or impairing their own influence upon 
its policy. Interagency jealousies also played their part in preventing 
organizational change. For example, the rivalry and even hostility between 
the National Park Service and the United States Forest Service were 
notorious in Washington ever since the Ballinger-Pinchot controversy 
of 1909. This feud may have been one of the obstructions in the path of 
reorganization proposals in 1923 and in 1937, because forestry enthusiasts 
feared that the Forest Service might be transferred to the Department of 
the Interior and merged with the Park Service. 

Moreover, few administrators face the problem, or the opportunity, of 
organizing their agency from scratch. Only when a new agency is set up 
to undertake a new job does the head and his assistants have to decide what 
factors shall govern the division of labor. Most administrators inherit an 
agency, complete with its existing structure, history, and traditions. 
Organizational change then becomes difficult to achieve. Frequently it may 
take a long time and a gradual program in order to realize the desired 
organizational pattern. It makes little difference that the nature of an 
agency's work may have greatly changed over a period of years. Corre- 
sponding alterations in structure which emphasize the new jobs and 
consolidate the less important ones are not easy of accomplishment. 

Political Factors in Organization. The relative immobility of many so- 
called old-line agencies is one reason why chief executives often prefer the 
creation of new agencies to carry out new tasks rather than to entrust the 
additional programs to an existing agency with its settled way of thinking, 
its already solidified clientele, and its fixed organizational traditions. Rea- 
sons of general administrative logic may suggest that related duties should 
be assigned to an agency possessing some "know-how." Reasons of high 
policy may dictate the exact reverse. There is, in fact, no purely adminis- 
trative or organizational answer to this situation. 

Unfortunately, organizational theory does not ordinarily recognize the 
personality factor. In reality, this is apt to be an important if not a con- 
trolling consideration in determining the organizational structure of any 
agency. The desire or need to accommodate a certain individual may lead 
to modification in structure simply for the benefit of that individual, or 
because consideration accorded him may secure more important advantages, 
It has happened, for instance, that the entire field organization of a great 
agency was adjusted to one top man who insisted that he could "work" only 
in a direct command relationship to field installations. Many a reorganiza- 
tion has been wrecked on the reef of personality. The student in the class- 
room or the writer on organization may pretend that personality factors are 
unimportant; the administrator, in determining organizational structure, 
may ignore them only at his own peril. 



WORKING CONCEPTS OF ORGANIZATION 145 

We may hear someone say, upon looking at an organization chart, "It 
may work; it all depends upon the individuals who are assigned to run it." 
In the present state of our knowledge about public administration, it is 
probably as sound to pick key individuals and build the organization 
around them as it is to establish the administrative structure and then seek 
the individuals to fill the key posts. Of course, the first alternative would 
not commend itself when there is likelihood of continued turnover in the 
key positions. 

To repeat, there are at least four different ways to divide up any major 
job, and all four may be used at various levels in the same agency. No one 
way is necessarily the best. It is vital, however, that the organizational 
pattern be clearly explained to all who are expected to help make it work. 
The personnel must understand how the job is divided and how the parts 
fit together. Without this, no structure can accomplish its purpose 
successfully. 

2, LINE AND STAFF 

In 1927, William F. Willoughby of the Institute for Government Re- 
search pointed out a "fundamental distinction" between the functional and 
the institutional activities of governmental services. 2 Functional activities, 
he said, are those an agency is expected to perform in other words, the 
objectives of the agency. Institutional activities are the work that must be 
done in order to keep the agency in operation. 

This distinction is similar to another one often made by writers on 
organization; it is the distinction between line and staff. Both words have 
a military origin, although they are now employed generally in civilian 
as well as military administration. 

v Meaning of Line. The word "line" is fairly simple to define. It refers 
to what in military practice is termed the "chain of command." Line means 
,the subordinate division of operating responsibility. Thus, in the federal 
government, we say that the line runs from the President to department 
heads to bureau chiefs, and so on downward. Or when the Federal Security 
Agency was set up, the line included the administrator of the agency, the 
Social Security Board as a directing unit, its executive director, the chiefs 
of the Bureaus of Old-Age and Survivors Insurance, Employment Security, 
and Public Assistance, and their operating subordinates. Or in a tactical 
military organization, the line is made up of the army commander, corps 
commander, division commander, regimental commander, battalion com- 
mander, company commander, and platoon leader. 

Concepts about the bases of organization would be more clearly under- 
stood if it were emphasized that they concern the division of duties in 
the line. Operating responsibilities may be arranged functionally or by 
purpose, by process or profession, by clientele or commodity, or geographi- 

2 Willoughby, W. F., Principles of Public Administration, p. 105, Washington: Brookings 
Institution. 1927. 



146 WORKING CONCEPTS OF ORGANIZATION 

cally. The line is simply the array of the various succeeding specializations 
necessary in accomplishing the task an agency exists to perform, v/ 

Meaning of Staff. Staff, on the other hand, is a more complicated con- 
ception. Many different definitions have been attempted. 8 The customary 
starting point is to say that the staff is merely an extension of the personality 
of the administrator. The job of management that is, of the administrator 
has been set forth in the specially contrived word POSDCORB. 4 These 
are the initial letters for planning, organizing, staffing, directing, coordinat- 
ing, reporting, and budgeting. Here, it is said, are the essentials with which 
the administrator must work. The units which are set up to assist him in 
that work are staff agencies. J 

It is customary in all writing about staff to point out that the operator 
at or near the base of the organizational pyramid needs no or little staff 
assistance. The foreman is his own staff. The superintendent of a depart- 
ment in a plant may have only an assistant or two. The plant manager, 
on the other hand, may have a number of persons organized in various 
units to help him. Those familiar with tactical military organization know 
that as the progression climbs upward from platoon leader to company 
commander, to battalion commander, to regimental commander, and to 
division commander, the staff organization becomes larger and more fully 
developed. Thus in all administration it is apparent that the greater the 
organization and the more jobs it has to do, the more staff assistance the 
administrator must have. 

Since staffagencies^exist to help the administrator, it is frequently 
said that they perform their work inrhiniame dlrtyancT have no command 
authority of their own. All power to issue orders rests with the admin- 
istrator. The staff simply prepares matters for his action; it does not issue 
commands of its own. This is supposed to be basic. It is also pointed out 
that the staff does not operate; it only plaAs, advises, suggests, and assists. 
Execution is left to others; that is, the line. -J 

These qualifications of staff have their importance, but they are unduly 
simplified as just stated. Staff activity is not so easy to define or to limit. 
Staff agencies or units often do issue orders which the administrator never 
sees, even though they will reflect his interests. Sometimes relations between 
staff units at various levels of the organizational hierarchy are very close, 
and it would be presumptuous to say that the higher units in actuality are 
not "operating." Sometimes the mass of recurrent work done by staff units 
is hard to differentiate from "operations." ^ 

Moreover, there are at least three different types of staff work. Perhaps 
we ought to say that there are four, and call planning a separate category of 
staff activity. When there is a central planning agency in which is concen- 

* Sec Urwick, Lyndall, "Organization as a Technical Problem," in Gulick and Urwick, 
of. cit. in note 1, p. 49 ff. 

4 See Gulick, ibid., p. 12 ff. 



WORKING CONCEPTS OF ORGANIZATION 147 

trated most of the long-range and short-range preparation for action, then 
we may rightly refer to planning as a major and separate staff activity. 
The previous discussion of planning has emphasized the crucial importance 
of this phase of administration. Accordingly, planning should be under* 
stood as one part of the staff job. 

Staff Activities Inherent in Administration. Apart from centralized 
planning, there remain three other kinds of work which often are called 
staff. Clear distinction between them will prevent much confusion. One 
kind is inherent in all administration. The most outstanding examples are 
budgeting and personnel activities. Every manager in public and private 
enterprise usually must prepare in some form an estimate of the financial 
cost of his work. This becomes a highly specialized job at the higher levels 
of administration. So also with personnel management. No work can be 
done without the people to perform it. Finding, obtaining, placing, and 
keeping the people needed on a job is a continuing concern. No staff work 
is more perennially a problem for the administrator than budgeting and 
personnel. This work weaves back and forth through all administration, 
at almost any level. 

Other activities may be placed in the same category. Public reporting 
and public relations surely belong here, but they are less well recognized 
as such and much less formalized in procedure than budgeting and per- 
sonnel. Nonetheless, external relations with the public are implicit in much, 
perhaps all administration. Sometimes the top administrator handles this 
business directly, while his subordinates play only supporting roles. 

Central Service Activities. Another type of staff work is a central service 
job for the benefit of all parts of an organization, or those carried on in the 
same vicinity. Thus there may be a central reproducing plant for photostat- 
ing or otherwise duplicating materials. There may be a central garage 
or warehouse. There may be centralized procurement of the supplies 
needed in running the agency, such as desks, paper, and typewriters. There 
may be mail and messenger services to provide. These are the so-called 
institutional activities of an administrative agency in the proper sense. The 
degree to which such work should be centralized is an important question 
of management which we need not debate here. The point is that exten- 
sive services are involved in running an organization; they may be central- 
ized in order to make the fullest possible use of specialized facilities and 
personnel. When such services are centralized and performed under the 
supervision of the top administrator, the combined unit is often called a 
staff facility. It is sometimes also described as an "auxiliary" establishment. 

Functional and Operating Staff. Finally, there are staff units created 
to guide or coordinate activities performed by operating units. This work 
depends entirely upon the tasks of an administrative agency and its primary 
basis of organization. Thus, in the Washington office of the Forest Service 
we encounter divisions of timber management, range management, wild 



148 WORKING CONCEPTS OF ORGANIZATION 

life management, and fire control. 5 The divisional designations refer to 
functional specialties in the Forest Service whose operating responsibility 
is organized geographically. Similar staff units are not likely to be found 
in many other agencies. In the Work Projects Administration, however, 
which was also organized geographically, there were functional specialists 
for educational projects, engineering projects, recreational projects, and other 
types of activity. In the Army Service Forces of the War Department, 
where procurement operations were divided basically by commodities, func- 
tional specialists dealt with purchasing policies, expediting of production 
and storage. 

Such supervisory or coordinating staff activities in an agency are deter- 
mined by the common threads which run through the operating units and 
by the decision to recognize some of these threads for uniform management. 
In the main, the specialists in particular elements of administration are 
likely to be the staff personnel with vital coordinating work to be done in 
major operating fields. They are concerned with the substantive work to 
be accomplished, and hence have assignments that vary with the agency. 
They are nonetheless staff, even when called the "functional" or "operat- 
ing" staff in order to differentiate them from those who perform central 
services or budget and personnel work. 

One other point needs to be made about staff activities. Some agencies 
permit cleavage or hostility to develop between staff and operating units. It 
must always be remembered that subordinate managers who direct the 
work are also advisers to the administrator. The latter does not look to 
his staff alone for counsel; he should and does look also to his subordinate 
managers or operators, since they too are expected to see the work not 
merely in its component parts but as a whole. Staff specialists and operators 
both make up an organization. They must work together. 6 

3. THE QUEST OF ORGANIZATIONAL UNITY 

Hierarchy and Span of Control. Sometimes administrative structure is 
| described as pyramidal. This is merely another way of expressing the con- 
.ception of hierarchy. As already indicated, organization begins with some 
broad purpose to be accomplished, and proceeds by dividing the job into 
^various component parts. As each new subdivision is created, the number 
of parts multiplies. From one person at the top, the organizational struc- 
ture breaks down into various superintendents, then to foremen or super- 
visors, and finally to workersthe base of the triangle. This has been called 
the "scalar" process or principle in organization. 

5 Sec Loveridge, Earl W. and Keplinger, Peter, "Washington-Field Relationships in the 
Forest Service," in Washington-Field Relationships in the Federal Service, p. 23 ff., Washington: 
Graduate School of the United States Depirtment of Agriculture, 1942. 

* Staff officers need a clear understanding, of the personal and psychological demands 
inherent in their role. For an excellent statement of how a staff officer should act, see Bellah, 
Lt. Coi. James W., "Staff Officer," Infantry Journal, 1944, Vol. 55 (No. 2), p. 43 ff. 



WORKING CONCEPTS OF ORGANIZATION 149 

The Catholic Church has long afforded an excellent illustration of 
hierarchy. At the base of the structure is the parish priest. Above the priest 
is the bishop of the diocese; in turn a number of bishops are grouped under 
an archbishop; and finally over the archbishop is the Pope in Rome. 
The triangular infantry division used as the basic tactical organization 
by the United States in World War II is another example of hierarchy. 
Four companies made a battalion, three battalions a regiment, and three 
regiments a division. 

Hierarchy means the grouping of units into a larger unit for direc- 
tion and control of activities. It is the method whereby the efforts of many 
different individuals are geared together. Hierarchy is another indispensable 
feature of large-scale enterprise. Only through hierarchical relationships 
can unified direction be achieved from one central point, and broad purposes 
be translated into action. This should not suggest, of course, that hierarchy 
may be relied upon as a substitute for cooperation. 

The importance of hierarchy is underlined by another organizational 
concept span of control. Any one individual can effectively supervise only 
a limited number of persons. Certain administrators and students have 
made this limitation specific no more than seven, nine, or twelve indi- 
viduals should report to the same superior. Today it is generally agreed 
that the number of individuals a person can direct depends upon several 
factors, especially the routine nature of the work, the place where the job 
is done, and the energy of the supervisor. It is easier to supervise many 
individuals when each is doing the same work, when that work is of a 
repetitive nature, and when it is performed close together. A limited num- 
ber of contacts for any one superior is nonetheless essential in order to 
ensure adequate supervision and coordinated action. 

Decentralization. Closely allied to the concepts of hierarchy and span of 
control is the concept of decentralization. This is another word with at 
least two administrative meanings quite aside from the political one in 
the sense of states' rights and institutions of local self-government. 7 In one 
administrative sense, decentralization as deconcentration is synonymous 
with delegation of authority. It refers to the assignment of responsibilities 
in such a way that substantial areas of discretion are entrusted to subordi- 
nate officers, thus preventing dangerous bottlenecks and overwork for the 
administrator at the apex of the hierarchy. We often speak of highly cen- 



7 The word "decentralization" has been used by some to refer exclusively to the federal 
system, whereby governmental authority is divided between national and state executives and 
legislatures. The grant-in-aid system described in Key, V. O., The Administration of Federal 
Grants to States, Chicago: Public Administration Service, 1937, and Clark, Jane P., The Rist 
of a New Federalism, New York: Columbia University Press, 1938 is a means of promoting 
national programs through state administrative agencies. Because of the use of the wore 
"decentralization'* to describe federal -state relationships, some have suggested the word "decon- 
centration" to describe interlevel or headquarters -field relationships in a particular agency. Foi 
a more detailed discussion see the symposium entitled Washington-Field Relationships in tht 
Federal Service cited in note 5. This matter is taken up below in Ch. 12, "Field Organization/ 



150 WORKING CONCEPTS OF ORGANIZATION 

tralized administration when we really mean that many actions require 
prior approval from the chief or one of his assistants. Conversely, we may 
think of a highly decentralized administration as one that is characterized 
by broad grants of power to individual component parts of the organiza- 
tion, with the retention of only certain essential controls in the head office. 

Decentralization, however, has yet another meaning, perhaps growing 
out of the one just circumscribed. It may refer to field organization, to the 
number of units operating away from the central office. The problems of 
field organization are discussed later in this book, and it is necessary to 
note here only that decentralization has also a geographic aspect, involving 
the type of field structure and the authority granted to field units. Much 
emphasis has been given to decentralization as deconcentration in recent 
years, because it has been discovered that rapid action in any large effort 
depends in considerable measure upon the extensive delegation of authority 
to subordinate officers or field establishments. ' 

Unity of Command. Still another concept often mentioned in discus- 
sions of organization is unity of command. This expression may refer to 
the desirability of having each subordinate in the chain of command report 
to a single individual. Or it may refer to an arrangement whereby all ad- 
ministrative authority flows from one responsible head, be he President of 
the United States, governor of a state, or president of a great corporation. 
And finally, the concept may refer to the question of the relative mer- 
its of a single-headed agency as compared with those of a board or 
commission. 

Much importance is usually placed upon the construction of an adminis- 
trative arrangement wherein each person has only one superior to whom 
he looks for direction. In such a setup an individual cannot receive con- 
flicting instructions, or play one superior off against another and thus 
escape effective supervision. On the other hand, when the subordinate is 
subject to multiple sources of command, confusion may arise and respon- 
sibility for action may be difficult to fix. Administrative expedience has 
shown this to be a cardinal factor in connection with general efficiency. 
Yet there are practical conditions which on occasion may dictate the crea- 
tion or continuance of a situation where one has two superiors. The con- 
cept of unity of command therefore needs to be reconciled with a recogni- 
tion that supervision of any activity may be dual technical and also admin- 
istrative. 8 The two types of supervision may be exercised by different 
individuals. The one type may be concerned with professional competence 
in the performance of a job, while the other is chiefly interested in the effi- 
cient utilization of the resources men and materials available for the job. 

Administrative responsibility is of especial concern in a democracy. Our 
great governmental machinery must be kept responsive to changes in politi- 

8 Sec Macmahon, Arthur W., Millett, John D. and Ogdcn, G., The Administration of 
Federal Wor\ Relief, ch. 11, Chicago: Public Administration Service, 1941. 



WORKING CONCEPTS OF ORGANIZATION 151 

cal opinion. When party control in the presidency changes, for example, 
we expect the new incumbent to be able to make his policies effective 
throughout the administrative agencies of government. Yet an unequivocal 
adoption of this policy has never occurred either in our national government 
or in most of our states and cities. Instead, we have used in many instances 
a different kind of arrangement, which has led to another concept that of 
administrative autonomy. 

Our great regulatory commissions, exercising so-called quasi-legislative 
and quasi-judicial authority, are often referred to as independent agencies. 
Their peculiar status is embodied in the law, and the Supreme Court has 
held that a member of such a commission may not be removed at will by 
the President. 9 Government corporations have also been viewed as inde- 
pendent, particularly when they were free to handle their funds under their 
own procedure and to appoint personnel regardless of civil service provisions. 
There is no "unity of command" over these agencies. Responsible direction 
is confused, to say the least. 

The practice of creating boards and commissions to exercise administra- 
tive authority is fairly extensive throughout federal, state, and local govern- 
ment. Many students will readily accept the famous dictum that boards 
are "long, narrow, and wooden." There is undoubtedly a place for boards 
in administration, as deliberative or consultative devices. However, it is 
quite widely recognized now that any activity requiring positive action and 
leadership can best be directed by a single individual. Boards violate the 
concept of "unity of command." They make rapid action difficult. We may 
admit that unity of command is an organizational objective, but it can 
scarcely be called an adequate description of actual administrative practice 
in our government today. 10 

9 Humphrey's Executor v. United States, 295 U. S. 602 (1935). 

10 On the whole problem of the organizational position of the regulatory commissions, 
see Cushman, Robert E., The Independent Regulatory Commissions, esp. chs. 10-13, New York: 
Oxford University Press, 1941. For a study of state regulatory agencies, see Fcsler, James W., 
The Independence of State Regulatory Agencies, Chicago: Public Administration Service, 1942, 
For fuller discussion, see below Ch. 10, "Independent Regulatory Establishments." 

There is extensive writing on the subject of government corporations. See particularly, 
Van Dorn, Harold A., Government-Owned Corporations, New York: Knopf, 1926; Dimock, 
Marshall E., Government-Owned Enterprises in the Panama Canal Zone, Chicago: University 
of Chicago Press, 1934, and Developing America's Waterways, Chicago: University of Chicago 
Press, 1935; Emmerich, Herbert, "Government Corporations and Independent Supervisory 
Agencies," in President's Committee on Administrative Management, Report with Special 
Studies, p. 299 ff., Washington: Government Printing Office, 1937; Thurston, John, Government 
Proprietary Corporations in the English-Speaking Countries, Cambridge: Harvard University 
Press, 1937; McDiarmid, John, Government Corporations and Federal Funds, Chicago: Uni- 
versity of Chicago Press, 1938; and Pritchett, C. Herman, "The Paradox of the Government 
Corporation," Public Administration Review, 1941, Vol. 1, p. 381 ff. For fuller discussion, 
see below Ch. 11, "Government Corporations." 

The best statement on the use and limitations of boards is to be found in a small 
pamphlet by Urwick, L., Committees in Organization, London, 1935 (reprinted from the 
British Management Review). 



152 WORKING CONCEPTS OF ORGANIZATION 

Coordination. There are yet two other terms frequently encountered in 
discussions of organization. These are "coordination" and "integration." 
Often they appear coupled together as if complementary. Actually, the 
two words describe very different structural arrangements. Indeed, coordi- 
nation does not refer to organization except indirectly. Rather it is a phase 
of management, a part of the job of supervision. Coordination is achieved 
when harmonious action prevails between the operating parts of an agency. 
The techniques of coordination run through the whole range of supervisory 
tools: careful planning of the job, clear definition of responsibility, establish- 
ment of reporting obligations, inspection of work, conferences of key per- 
sonnel, proper and convenient channels of communication, higher approval 
of action proposed by subordinates. And the list could be extended. 

Organizationally, the first problem of coordination is to ensure that there 
are adequate staff facilities to help exercise the necessary authority. Coordi- 
nation must be achieved by providing the administrator with competent 
assistance. Wherever there are important subjects of common interest to 
different operating agencies or units; wherever their fields of activities tend 
to duplicate or overlap; wherever it is necessary to have common problems 
of operating units handled on a common basis in all such situations a 
coordinating staff is needed. 

On the other hand, staff coordination may develop difficulties. Staff 
works in the name of the administrator, but the operating official may still 
go to the boss and protest what may look to him like direct staff instruc- 
tions. A large organization may have many staff facilities, thus increasing 
the number of subordinates reporting to the administrator. As operating 
agencies multiply and perform increased work, there is often a tendency 
to enlarge the staff of the administrator at the same time. The result may 
be confusion arising from a desire by the staff to assume more and more 
operating authority; another result may be congestion or overcrowding 
at the top. 

Integration. Integration offers a possible solution for situations like 
these. Integration means the combination of operating units under an addi- 
tional administrative official interposed between them and the top adminis- 
trator. The interposed individual is not a staff officer but a line adminis- 
trator. He commands the group of combined units, and thereby reduces the 
number of operating officials reporting to the top man. 

An example of coordination proceeding toward integration is afforded 
by housing experience during World War II. Prior to the war, there were 
a Federal Housing Administration and a Federal Home Loan Bank Board 
in the Federal Loan Agency, and a United States Housing Authority in the 
Federal Works Agency. The need for handling the urban housing problem 
on a uniform basis during the defense period led the President to create, 
by Executive Order No. 8632 of January 11, 1941, a Division of Defense 
Housing Coordination in the Office for Emergency Management, part of 



WORKING CONCEPTS OF ORGANIZATION 153 

his Executive Office. This was a move in the direction of coordinating 
housing programs by setting up a staff officer in the housing field, with the 
President as the direct head over the Federal Loan Agency and the 
Federal Works Agency. When, for various reasons, this effort did not 
succeed, the President, by Executive Order No. 9070 of February 24, 1942, 
established under his war powers the National Housing Agency. Into 
the new agency went as its three component parts a Federal Public Hous- 
ing Authority (formerly the USHA), the Federal Housing Administration, 
and the Federal Home Loan Bank Board. The President now had one 
man to look to in the housing field the administrator of the National 
Housing Agency. Previously he had had to deal with three his staff 
officer on housing and the heads of the Federal Works and Loan Agencies. 11 
Coordination can be achieved through staff planning and supervision. 
Integration is the means for reducing the structural diversity of too elabo- 
rate an organization, or for lightening the burden on a central staff. In 
effect, integration introduces a new level in the organizational hierarchy 
a new level of coordinating authority. The added line administrator will be 
able directly to iron out difficulties between subordinate units. Fewer issues 
will then require coordination at the next higher level. Integration is the 
organizational device which will cut down a top administrator's load. Co- 
ordination simply sees to it that he performs his role and carries his load. 

4. GUIDING RULES OF ORGANIZATIONAL DESIGN 

"Need for Standards of Organization. There have been attempts from 
time to time to formulate guides or standards of organization. While our dis- 
cussion has briefly outlined the major problems in organization, it has pro- 
vided no answers for those with organizing responsibility. The need for 
some positive guidance to administrators in fixing organizational structure 
has often been felt. This in turn has led various students to set up standards 
of what is assumed to be good organization. 



11 There is a great deal of literature about general problems of organization. The follow- 
ing are listed as a few of the major contributions to the subject: Gulick and Urwick, op. cit. 
in note 1; Gaus, John M. and Others, The Frontiers of Public Administration, Chicago: Uni- 
versity of Chicago Press, 1936; Willoughby, op. cit. in note 2; Snrth, Edgar W., "Relation 
of Organization to Management," in the symposium entitled Administrative Management, 
p. 53 ff., Washington: United States Department of Agriculture Graduate School, 1938; and 
Senate Select Committee to Investigate the Executive Agencies of the Government, Preliminary 
Report, 75th Cong., 1st Sess., Washington, 1937. Cf. also Hopf, Harry A., "Administrative 
Coordination," in Morstcin Marx, Fritz, cd., Public Management in the N'tv Democracy, 
p. 83 ff., New York: Harper, 1940; Urwick, L., The Elements of Administration, New York: 
Harper, 1943; Dimock, Marshall E., The Executive in Action, New York: Harper, 1945; and 
Hopf, Harry A., "Soundings in the Literature of Management," Advanced Management, 1945, 
Vol. 10, p. 93 ff. 

Among the many books about organization of private enterprise, see Mooney, James D. 
and Reiley, Alan C., The Principles of Organization, New York: Harper, 1939, and Holden, 
Paul E., Fish, Lounsbury S. and Smith, Hubert L., Top Management Organization and Con- 
trol, Stanford: Stanford University Press, 1941. 



154 



WORKING CONCEPTS OF ORGANIZATION 



Necessarily these standards have been general in terms; they have sug- 
gested pitfalls to avoid as much as positive action to take. Three of these 
efforts at stating enduring guideposts of organization are summarized in 
comparative tabular form below. The selection may be regarded as repre- 
sentative of all efforts to formulate organizational standards. 



ENSURING SOUND ORGANIZATION 



1. Definite and clean-cut 
responsibilities should 
be assigned to each 
executive. 



2. Responsibility should 
always be coupled with 
corresponding author- 
ity. 

3. No change should be 
made in the scope or 
responsibilities of a 
position without a 
definite understanding 
to that effect on the 
part of all concerned. 



4. No executive or em- 
ployee, occupying a 
single position in the 
organization, should 
be subject to definite 
orders from more than 
one source. 



5. , Orders should never 
be given to subordi- 
nates over the head of 
a responsible executive. 
Rather than do this 
the officer in question 
should be supplanted. 



II** 

1. Definite responsibil- 
ity and authority 
should be estab- 
lished for all posi- 
tions. 

(a) Authority must be 
commensurate with 
responsibility. 

2. Organization of the 
department should 
be clearly defined. 
. . . Organization is 
an ever - changing 
vehicle of manage- 
ment and thus 
must be molded 
through the use of 
executive orders, 
bulletins, office 
memoranda, and 
. . . frequent staff 
and individual con- 
ferences. 

3. The leadership of 
the department as a 
whole and of each 
of its line subdivi- 
sions should be sin- 
gle and direct. 



Ill*** 

1. Definite and clean- 
cut responsibilities 
should be assigned 
to each employee, 
particularly the key 
employees. 

2. Responsibility must 
be accompanied by 
reasonably complete 
authority. 



3. No employee, oc- 
cupying a single 
position in an or- 
ganization, should 
be subject to defi- 
nite orders from 
more than one per- 
son. 



WORKING CONCEPTS OF ORGANIZATION 



155 



ENSURING SOUND ORGANIZATION Continued 

II** III*** 



6. Criticisms of subordi- 
nates should, whenever 
possible, be made pri- 
vately, and in no case 
should a subordinate 
be criticized in the 
presence of executives 
or employees of equal 
or lower rank. 

7. No dispute or differ- 
ence between execu- 
tives or employees as 
to authority or respon- 
sibilities should be 
considered too trivial 
for prompt and careful 
adjudication. 

8. Promotions, wage 
changes, and discipli- 
nary action should al- 
ways be approved by 
the executive immedi- 
ately superior to the 
one directly responsi- 
ble. 

9. No executive or em- 
ployee should ever be 
required, or expected', 
to be at the same time 
an assistant to, and 
critic of, another. 

10. Any executive whose 
work is subject to reg- 
ular inspection should', 
whenever practicable, 
be given the assistance 
and facilities necessary 
to enable him to main- 
tain an independent 
check of the quality of 
his work. 



4. The director of the 
department and 
each division chief 
should be assisted 
in their administra- 
tive responsibilities 
by the management 
and staff activities 
under their author- 
ity. 

5. No administrator of 
a department or di- 
vision should have 
reporting to him 
more persons than 
he can adequately 
supervise. 



5. 



Wherever possible, 
an independent 
check of an em- 
ployee's work 
should be made 
and the results of 
the check should be 
made available to 
the employee in as 
helpful a manner 
as possible. 
Not more than 
three to six em- 
ployees who are 
charged with im- 
portant and varied 
responsibilities 
should be subject 
to the direct orders 
of the same man. 



156 



WORKING CONCEPTS OF ORGANIZATION 
ENSURING SOUND ORGANIZATION Continued 



I* II** III*** 

6. Veto power must 
be given only to 
persons who are 
charged with re- 
sponsibility for the 
results of their 
vetoes. 

6. The main subdivi- 
sions of the depart- 
ment should be 
based upon an 
analysis of the ac- 
tivities carried on, 
with all activities 
which are alike in 
scope or technique, 
or which require a 
similar type of su- 
pervision, grouped 
together. 

7. Positions should be 
determined insofar 
as possible irrespec- 
tive of individuals, 
on the basis of the 
various classes of 
work to be per- 
formed. 

8. Coordination of the 
work and personnel 
of the several ma- 
jor divisions of the 
department should 
be the primary con- 
cern of the depart- 
ment director. 

*"Tcn Commandments of Good Organization," prepared by the American Management 
Association and quoted in Public Administration Review, 1943, Vol. 3, p. 80, note 1. 

**From Stone, Donald C., The Management of Municipal Public Worths, pp. 7-8, Chicago: 
Public Administration Service, 1939 (by permission of the publisher). 

*** Principles developed by the Surplus Marketing Administration and reported by 
Allsetter, W. R., in Public Administration Review, 1943, Vol. 3, p. 80 ff. (by permission 
of the editor). 

Summary. Our working concepts of organization are founded on gen- 
eral observations which have crystallized from experience. Four primary 
bases are in common use for dividing up operating responsibilities. It is of 
practical value to recognize the differences between line and staff, between 



WORKING CONCEPTS OF ORGANIZATION 157 

the operating work which accomplishes the end-purpose of administrative 
effort and the work that is done to keep the organization fit for effective 
action. The operating job is broken down into various levels of supervision. 
This is the foundation of hierarchy. Ideally, we want a single line of author- 
ity throughout the hierarchy; that is, we want unity of command. How- 
ever, the concept of unity of command must allow for a distinction between 
technical supervision and administrative supervision since the one is con- 
cerned with specialized professional work and the other with general 
efficiency and performance. Coordination is necessary among operating 
units, but when the coordinating burden becomes large, a new level of 
supervision may be introduced through integration. 

Generalizations about organization must be modified because of per- 
sonality factors and because of peculiar circumstances of time and place. 
There are no final answers to all organizational problems, even though we 
do have signposts for our guidance in applying the working concepts of 
organization. 

Management is common to all public enterprise, whether the ultimate 
product is flood control, military defense, or collection of taxes. That is 
why the general body of public administration as a field of knowledge 
deals with common problems. These make up the realm of interchangeable 
experience in public administration. At the same time, we should never 
forget that we are talking only about ways and means, about techniques 
and processes. It is the administrative end-product that is of first impor- 
tance. Our deeper concern is with organizing to achieve that end-product 
for the benefit of the community, with the least depletion of available 
resources. 



CHAPTER 



The Chief Executive 

1. DUAL FUNCTION: POLICY AND ADMINISTRATION 

Means and Ends.CAt its highest reach, administrative management is 
so closely intertwined with leadership in policy development that in most 
governmental jurisdictions and in nearly all private organizations both 
functions are intentionally lodged in the same top man. This is the central 
fact setting off the position of the chief executive from those of all lesser 
administrative officers, whether they be called executives, administrators, 
managers, or by some other title. It is our purpose in the present chapter 
to describe and analyze this most important of all offices in public adminis- 
tration by focusing on five basic aspects: the duality of the executive's 
functions; leadership and authority; external relationships; the tools needed 
for effective control; and the arms of modern management. 

The justification for studying administration apart from other phases of 
government rests, as we saw earlier, on the possibility and the utility of 
distinguishing between political ends and administrative means. Of course, 
acceptance of the validity of this distinction in no way denies the fact that 
there are higher and lower levels of administration and of policy. Nor does 
it place in doubt the necessity for differing degrees of initiative and discre- 
tion to be exercised throughout the entire range of political power and 
administrative authority. 

Lesser ends are themselves means toward greater ends, and higher 
means are intermediate ends reached by lower means. The need for deci- 
sion is everywhere the same, and, wherever a decision must be made, there 
in one sense both a question of policy and a question of administration 
have to be decided. If for intellectual convenience we abstract from the 
general context sometimes the one, sometimes the other, life remains none 
the less tangled and connected. Yet schemes and symbols of analysis have 
great value if their limitations are borne in mind. 

(j[f the accent be on policy that is, on ends we may, for instance, observe 
that even where major policy decisions are made by individuals holding 

158 



THE CHIEF EXECUTIVE 159 

political responsibility, minor policy decisions will still be left to administra- 
tive officers. Does this mean that the distinction between politics and 
administration is faulty? Not at all. It merely recognizes that below the 
plane of political policy-determination lie other planes planes of adminis- 
trative policyon which also questions of alternative courses of action have 
to be decided. Conversely, if the accent be on means that is, on alterna- 
tives of administration we should acknowledge that above the issues of 
administrative machinery and procedure lie issues of political ways and 
means. Administrative preferences therefore may have to yield to neces- 
sities of politics. <^Political politics" and "administrative administration" 
give only the broad outlines of the picture of government; the full portrait 
calls for the lights and shadings of administrative politics and political 
management.) 

In the whole realm of government perhaps no one appreciates the 
truth or the importance of this proposition so much as the chief execu- 
tive. The President of the United States, the governors of New York, 
Pennsylvania, and California, and the mayors of New York City, Chicago, 
Philadelphia, Detroit, St. Louis, Los Angeles, and Boston, as responsible 
heads of the executive branch in our largest governmental jurisdictions, fur- 
nish outstanding illustrations of the range and complexity of the responsi- 
bilities inherent in this office. Yet abilities of the same kind if not of the 
same order are needed at the helm of every sizable administrative establish- 
ment whatever the governmental level in the governorship of each state, 
in the mayoralty of every urban community, in the top office of scores of 
thousands of other units of local government, and also in the direction of 
all large administrative departments. 

Separation of Political Leadership and Administration. Before proceed- 
ing into an analysis of the chief executive in his typical role, let us examine 
briefly several types of situations in which the responsibilities of policy devel- 
opment and administrative direction are assigned to different officials rather 
than concentrated in a single individual. Turning first to instances of such 
separation outside government, we may note the common practice among 
business corporations of vesting responsibility for corporate policy in a board 
of directors headed by a chairman and delegating corporate management to 
a president or general manager. 

Election as chairman of the board expresses recognition of demonstrated 
initiative and intelligence in policy leadership. Elevation to this position 
signifies above everything else the primacy of company policy. While the 
president or general manager may also be a director, his first duty is the 
effective execution of whatever policies the board may adopt. Nor are busi- 
ness corporations the only organizations employing such a division of basic 
responsibilities. The way the presidents of many private colleges and uni- 
versities, and other nongovernmental institutions and associations as well, 



160 THE CHIEF EXECUTIVE 

stand inflation, to the chairmen of their boards of trustees or regents fol- 
lows the same pattern. 

There are fewer clear examples of such separation within govern- 
ment. Perhaps the most striking illustration is furnished by municipal 
organization under what ought to be called for the sake of completeness the 
mayor-council-manager plan. The theory behind this soundest of all forms 
of municipal government is perfectly plain. Policy leadership is the respon- 
sibility of the council, and particularly of its chairman, the mayor whether 
he be chosen by the council or elected by the voters. The city manager's job 
is confined to advising with the mayor and council on matters requiring 
their decision, and administering the work program which they adopt. 

Other examples may be found in the field of public education. Insofar 
as underlying theory is concerned and the facts themselves are more or 
less in line with it the relations between local boards of education and 
their superintendents of schools are like those prevailing under the council- 
manager plan. The same applies to the relations between state boards of 
education and the presidents, chancellors, and provosts of state colleges 
and universities. 

One other situation remains to be mentioned in the same context. In 
the more recent past not a few governmental agencies national, state, and 
local have found it productive of good administration within their own 
organizations to distinguish consciously between policy concerns and man- 
agement responsibilities. Commenting on the general necessity for "a com- 
mon focus for management facilities either in an administratively minded 
department head or in a general administrator working in close association 
with the policy leadership of the agency," Donald C. Stone in 1943 of- 
fered this brief summary of specific though tentative develoments in the 
federal government: 1 

A few years ago observers thought they saw in a few departments 
the beginnings of general managership positions which could meet this 
need, but the development has not continued. Recently there has been 
some experience with trying to solve the management problem by ap- 
pointing career administrators to assistant secretaryships or undersecre- 
taryships of departments, positions traditionally occupied by political 
appointees. There is not yet a consensus on the best solution. 

(^Separation of responsibilities for policy initiative and general manage- 
ment presents obvious practical advantages on appropriate levels of action. 
There is something to be said for the view that further advancement in 
public administration depends in some measure on the possibility of a more 
extensive employment of the formula behind it. Yet in all the cases here 

1 See his report entitled "Federal Administrative Management, 1932-1942," Transactions 
of the American Society of Mechanical Engineers, 1943, Vol. 65, p. 242 ff. The question of 
providing for a general manager or business manager in the departmental framework has 
nothing to do, of course, with the distinction between staff and line. See above Ch. 7, "Work- 
ing Concepts of Organization," sec. 2, "Line and Staff." 



THE CHIEF EXECUTIVE 16 1 

cited the distinction between political head and administrative manager 
is sharper in name than it is in fact.(jThe separation of these roles is suc- 
cessful only where the relationships between the officials are characterized 
by mutual confidence confidence sustained through frequent conference 
and counsel. V The practical working arrangements between the two will 
vary somewhat from jurisdiction to jurisdiction.LTheir net result in every 
case should be such a modification of the functional separation as to pro- 
duce, in Bagehot's phrase, an "intimate detachment" between the two officers' 
like that between the British minister and his permanent undersecretary/ 

Combination of Political Leadership and Administration. Having 
acknowledged the fact of instances of bifurcation even in government, we 
may return to the general rule: combination of policy initiative and top 
management in a single official known as the chief executive, who is sub- 
ject to legislative control. This is the principal clue to the nature of the 
office of President and, on their own planes, the offices of governor and 
mayor. Each serves simultaneously as political leader and administrative 
chief. The powers and prerogatives of their offices may be inadequate to 
the double task; yet they are supposed to be effective in both capacities. As 
for the handicaps under which they may have to labor, they are expected 
to surmount them or contrive to reduce their ill effects. 

Every one of our presidents since John Adams has realized that no one 
could hope to be a successful leader of national policy if he did not first 
succeed in being the effective leader of his own political party. On the 
administrative side, nearly every president at least since Theodore Roose- 
velthas shown himself aware of the need for better managerial arrange- 
ments to facilitate executive leadership and has tried to obtain such 
arrangements. 

In the states and cities, developments have been been roughly parallel. 
Governors and mayors have long recognized the indispensability of organ- 
ized support among the voters in order to be influential in making or 
changing public policy. Generally speaking, however, it has only been 
since the first practical tests in 1917 of state administrative reorganiza- 
tion that governors have begun to be comparably effective as administrative 
chiefs. Even now, nearly half of the states are still substantially untouched 
by this movement. 2 As for mayoral chief executives, in most cases they 
are unable to measure up to the expectations held for them as adminis- 
trators until the municipality has revised its charter with the intent of 
adopting the so-called strong-mayor form of city government. Many Ameri- 
can cities, particularly those with larger populations, have effected such re- 
visions. However, there remain hundreds upon hundreds of communities 

2 Lipson, Leslie M., The American State Governor: From Figurehead to Leader, Chicago: 
University of Chicago Press, 1939, probably provides the best summary and analysis of the 
position of the governor as chief executive currently available. 



L62 THE CHIEF EXECUTIVE 

where the lot of the municipal executive as administrative head is not a 



lappy one. 3 



2. LEADERSHIP AND AUTHORITY 



Cloa\ of Legal Power. Patently, the position of chief executive em- 
)odies tremendous responsibility and authority. (However, no man who 
jains this high place is likely to achieve more than indifferent success unless 
ic conceives his job first of all in terms of opportunity for lasting accomplish- 
nent.y That is the mark of the great chief executive in democratic gov- 
ernment: he looks upon his office as giving him for his term the noblest 
assignment within the power of the people the privilege of making his 
e^ership effective in action designed to promote the general welfare. 
/vThe greatest of American presidents and governors and mayors have 
lever been content to do only what they had to dpjjNor have they relied 
jpon their legal authority alone to win their ends/ Although not unwilling 
:o use authority when obliged to do so, they Have always had clear ideas 
about the uses to which the power of government should be put, and have 
^referred to gain their ends through leadership rather than through im- 
)osition of constitutional sanctions. 

( Every public office requires a legal definition of its competence. Such 
definitions have their merits. They are valuable for establishing fields of 
recognized jurisdiction among various officers. They are also indispensable 
n enabling the courts to decide cases involving on the one hand the duty 
:>r discretion of an administrative official and on the other the right of a 
>rivate citizen. Yet it is clear that at the top of the administrative hier- 
irchy such legal delineations, though not unnecessary, are in themselves 
nsufficient to raise an official to the stature of a chief executive. Clothes 
do not make the man; neither do the vestments of power make a president. 
Legal authority a chief executive must have. However, unless it is in 
effect a confirmation of leadership accepted or emerging, the chances are 
:hat it will profit him very little.^ 

Constitutions and charters invest a chief executive with the legal com- 
setence to recommend and veto legislation, appoint and dismiss subor- 
dinate officials, orepare and upon legislative approval execute budgets, 
represent the government at all manner of official functions, and direct 
:he entire executive establishment. The placement of these several powers 
in his hands is obviously essential to the performance of his main duties, 
but it is far from being all that is essential. Legal powers are, so to speak, 
the executive's bones. Flesh and blood, mind and spirit, he must supply 
bimself. 

Personal Qualifications. One of the things of mind and spirit the execu- 

3 For sound treatments of the executive function in city government, see Story, Russell M., 
The American Municipal Executive, Urbana: University of Illinois, 1918, and Reed, Thomas H., 
Municipal Management, New York: McGraw-Hill, 1941. 



THE CHIEF EXECUTIVE 163 

tive must bring to his job is strength and balance of personality. ^Without 
the deeper authority latent in this resource the prospect of his developing 
vital relationships will be almost nil, in administration as well as in politics. 
For an administrative head, it is one thing to have the legal right to com- 
mand; it is something quite different to have effective direction over an 
executive organization. The former is a matter of formal power. The 
latter is largely a matter of appeal and influence. It requires, first of all, 
evidence ofjnterest, intelligence, and energy. Unless there be about the 
executive a single-minde'dness which will enable him to generate and sus- 
:ain a general concern for the fulfillment of the goals of his program, he 
cannot hope to assert the authority that signifies the true leader. If he 
does not care, no one will care; there will be no program. / Let him beware 
at all times of being content merely to sit in the executive's chair; his job 
consists not of being but of doing.* Only if he demonstrates by continuous 
interest that he has made the aims of the total enterprise his very own 
concern will he stand out as head of the organization. 

Basic intelligence as contrasted with great learning is so indispen- 
sable that nothing more is needed here than the merest mention of it 
No man willingly takes suggestions much less orders from someone 
who is plainly "hard of thinking," regardless of how eminent or exalted 
his position. (The hardness may stem from deficiency of brain power or 
From set bias or from infirmity of age; it makes no difference) There is 
no substitute for the ability to think.\x 

Energy is another prime necessity. He could never be more than a 
lominal executive who, though showing steady interest and intelligence, 
kvas devoid of physical and nervous vigor. It is not surprising that presi- 
dents, premiers, and other top executives find their tasks a heavy drain 
upon their energies. .-'That is an inescapable aspect of their work. There is 
a point to the argument that a man's age and vigor have a direct bearing 
on his fitness for high executive office. Exceptions can be justified by ex- 
:eptional facts, but, as a general rule, no one should be asked or expected to 
undertake arduous executive responsibilities in his declining years. Especi- 
illy in the American presidency, the risks to the public welfare are too 
great in an era when government must play so positive^a role in support 
Df the social order. %> ) 

These qualities are fundamental to strength of personality. (JBut they 
must also be in balance. )Unless the individual's traits are so combined 
that they will enable him to win and hold the devotion of other men, he 
has little chance of meeting the demands made on the executive office. 
Others must be able to feel that they know him and can trust him, be- 
cause he is regarded as the captain of their team. (President Franklin D. 
Roosevelt epitomized the right point of view at his first inaugural: "For 
the trust reposed in me I will return the courage and the devotion that 
befit the time. I can do no less. . . . The people of the United States . . . 



164 THE CHIEF EXECUTIVE 

have made me the present instrument of their wishes. In the spirit of the 
gift I take it/0 

Marf( of Leadership. More specifically, an executive must have that 
quality about his whole personality which enables him, without sacrificing 
integrity of purpose, to lubricate human relationships* \It is this influence 
that prompts men to prefer action based on their big agreements to endless 
argument over their little differences.) It is this influence that induces them 
to retain their enthusiasm for a general program even after it has become 
clear that they are not going to be able to "have things exactly their own 
way.'* | The chief executive can have high self-confidence, but only if his 
identification with the entire administrative undertaking is so complete 
that those around him will take his sureness as proof of a conviction that 
"Together we can and will do it!" Probably General Eisenhower rose to 
as nearly perfect an identity of individuality and program during the war in 
Europe as has been reached by any great executive in recent years. The 
seal of that perfection lay in his being even more ready to take the blame 
when things went wrong than to accept the glory when victory crowned 
the efforts of his soldiers and his staff. To be truly effective, says Urwick 
in his Elements of Administration, 4 "command must represent a common 
objective." Whether or not it achieves this depends primarily upon the 
spirit that emanates from the commander's personality. 

Someone has defined leadership as the ability to make other men "feel 
two inches higher." The observation applies to administrative leadership 
as much as to any other kind. The greatest executives are always marked 
by a generosity of attitude toward those under them, by a willingness to 
overstate rather than understate their subordinates' accomplishments, par- 
ticularly when it comes to the assessment of credits and honors. The toast 
which Joseph Stalin offered at the victory celebration in the Kremlin on 
June 25, 1945, for example, affords some insight into the executive qualities 
of this leader: 5 

(Do not expect me to say anything extraordinary. I have a most simple 
and ordinary toast to propose. 

I should like to drink the health of the people of whom few hold ranks 
and whose titles are not envied, people who are considered to be cogs 
in the wheels of the great State apparatus, but without whom all of us 
marshals, front and army commanders are, to put it crudely, not 
worth a tinker's damn. One of the cogs goes out of commission and 
the whole thing is done for. 

I propose a toast for simple, ordinary, modest people, for those cogs 
who keep our great State machine going in all the branches of science, 
national economy and military affairs. There are very many of them, 
their name is legion they are tens of millions of people. 

They are modest people. Nobody writes anything about them. They 

4 Urwick, Lyndall, The Elements of Administration, p. 80, New York: Harper, 1943. 

5 Information Bulletin, Embassy of the Union of Soviet Socialist Republics in Washington, 
July 12, 1945. 



THE CHIEF EXECUTIVE 165 

have no titles and few of them hold ranks. But they are the people who 
support us, as the base supports the summit. 

I drink to the health of these people our respected comrades. 

One other basic element iri administrative leadership remains to be 
mentioned. It is the most important of all.) That is the talent for ideas, 
the ability to conceive solutions to current political, economic, and social 
problems which the public will approve, or, at the least, can be persuaded 
to accept. In the final analysis, a chief executive succeeds or fails in terms 
of the substantive policies he espouses and if he espouses none he is not a 
chief executive. No matter what other qualifications a man may possess, 
if he lacks the capacity for initiating concrete proposals to meet the urgent 
issues of his day, he has no warrant for seeking or accepting executive 
office. Nor is he likely to gain such office if he has to win his way in an 
election against someone who does have positive ideas to offer. 

Political and Administrative Talent. Anybody can rant about the need 
for efficiency and economy in government. Every normally articulate ad- 
ministrator inveighs against unnecessary overlapping and duplication. No 
ordinarily alert official has yet been found who has denied the need for 
coordination and cooperation among governmental agencies. But these are 
not policy issues.^ They are standards, and they are universally accepted. 
Up to now no Democrat has been caught alive who would admit that a 
Republican could be more firmly attached to such standards than he 
or vice versa. And none ever will. 

With respect to public policies, however, the situation is wholly different. 
Whether a chief executive is concerned about social issues and willing to 
take a stand on proposals for their solution is something the electorate can 
easily find out. It is impossible for him to get by with pretense or evasion, 
except temporarily. A man aspiring to elective executive office must be 
prepared to disparage the claims of the opposition candidate and there may 
be times when this alone will "put him in." However, the fundamental 
thing the people want to know is not what the incumbent has done wrong 
but how the contender would do things differently. 

In a purely administrative or managerial position, commitment to such 
goals as "economy and efficiency" is all that can be expected. Such rather 
mechanical or mathematical virtues plus platform technique do not suffice 
to make a president or a governor. Nor can a chief executive worthy of 
the name be produced by synthetic compositionso much political leader- 
ship and so much executive ability. The assumption may have done him 
an injustice, but Thomas Dewey was handicapped in the 1944 presidential 
race by the suspicion, widely entertained, that he was not a "natural." Few 
of his critics could deny that he appeared to have made a good record "as 
an administrator," yet they were able to persuade many voters that, even 
though he was efficient, at any rate he was "nothing more." Be this as it 
mavJ the fact remains: over and above administrative capacity a chief 



166 1KB CHIEF EXECUTIVE 

executive must possess talent for political leadership. If he has the latter 
in abundance it may compensate for deficiencies in the former because 
soundness of policy generally eases administrative tasks. ff*he rule does 
not apply with equal force in reverse, however, because there is no substi- 
tute for enlightened vision.) 

American Presidents. From Washington to Truman, the American 
presidency illustrates considerably varying types of executive leadership. 
Among the thirty-two men who have occupied the position, several stand 
out as administrative heads of extraordinary talent. Washington's signal 
success in launching the new government is traceable to his ability to take 
ideas from both Hamiltonian and Jeffersonian sources, weld them into a 
single program, and then enlist the aid of both factions in its execution 
The inferior of both Hamilton and Jefferson in originating plans and pro- 
posals, he was their superior in devising combinations of policy on which 
it was possible to reach agreement for action. What made Washington's 
leadership acceptable and effective, however, was not simply his intelli- 
gence at finding high common denominators. There were also his known 
competence in management and his proven personal disinterestedness. The 
secret of his achievement as President did not lie, of course, in the legal 
authority with which he was endowed by virtue of Article II of the Con- 
stitution. It lay in the confidence the public had learned to put in him be- 
cause of the character of his leadership displayed first in the crisis of the 
Revolution and later in the Critical Period. 

In analyzing the reasons for Jefferson's high stature as President, we are 
tempted to wonder what kind of record his rival Hamilton would have 
made had he been elected. The answer is suggested by saying that Hamil- 
ton could hardly have been elected: with all his brilliance he had too little 
gift for compromise. An executive he could have been and indeed a very 
great executive he was but not a chief executive, sensitive to working re- 
lationships. Jefferson did not begin to equal Hamilton in sheer admin- 
istrative skill, but in the realm of political thinking he had a clear advantage 
over the scintillating New Yorker, especially when we consider the nascent 
democracy in which they were mutual contenders for popular support. The 
fact is that among all our chief executives probably none accomplished so 
much with such slight administrative wherewithal as Jefferson. His presi- 
dency proves as does no other the truth that insofar as the highest office 
in American government is concerned, political ingenuity carries greater 
weight than administrative talent. 

President Jackson exhibited a type of executive personality profoundly 
different from that of any of his predecessors, and quite at variance, too, 
with that of any occupant of the White House since. Considering himself 
the spokesman of the hitherto more or less unenfranchised common man, 
and particularly of the rising West, he took office with the conviction that 
he had a mandate from the electorate to restore the government to the 



THE CHIEF EXECUTIVE 167 

people. To him, this entailed beating back the growing concentration of 
financial power in private hands, and preserving and strengthening the 
Union against all hazards. In his view, a president would be guilty of 
dereliction of duty if he held himself under no higher obligation than to 
furnish Congress with information on the state of the Union and admin- 
ister such laws as the legislature might adopt. He saw with exceptional 
clarity that under the American Constitution effective government de- 
pends mainly upon the chief executive. If he failed to offer positive 
leadership, no one else could substitute for him. 

Lincoln's genius, like Jefferson's, lay far more in the political than in 
the administrative realm. Where other men, abler and more experienced 
in governmental management, lost their heads and embraced proposals 
which could not possibly have united the nation, he devised a policy at 
once moderate, positive, and capable of evoking enthusiastic popular sup- 
port: the limitation of slavery to those areas where it already existed and 
the preservation of the Union. His championship of these policies, attended 
as it was by unfailing steadiness, humility, and magnanimity, earned for him 
his preeminent rank among the men who have occupied the presidency. 

Creative Policy Versus Sound Administration. Time lends a perspective 
to our comments on the administrations of Washington, Jefferson, Jackson, 
and Lincoln which we shall lack for years to come in the case of those 
who have lived in the White House more recently. It is impossible to ap- 
praise with equal accuracy the capacities and accomplishments of Cleveland, 
Theodore Roosevelt, Wilson, and Franklin D. Roosevelt. Yet there is 
one thing that can be said of these later presidents quite as safely as of the 
earlier ones. They were distinguished far more for socially creative policy 
than for economically efficient administration. 6 

Nor does the rule work only one way. The national chief executives 
who are least well remembered are precisely those who lacked the impulse 
or the capacity to be imagiaative about their office. They tended to look 
upon their powers in narrowly legal terms or seemed unable to conceive 
of any higher public service than that of reducing the tax rate. Buchanan, 
Grant, McKinley, Harding, and Coolidge rank among the lesser lights of 
the White House for one and the same reason. Since they pursued no dis- 

6 For broad verification of the theses presented in the text, see Corwin, Edward S., The 
President: Office and Powers, New York: New York University Press, 1940; Laski, Harold J., 
The American Presidency. New York: Harper, 1940; Milton, George Fort, The Use of Presi- 
dential Power, Boston: Little, Brown & Co., 1944. 

The literature of business administration is voluminous. For an analysis of the more 
important qualifications and functions of top corporation executives, see Clccton, Glenn W. 
and Mason, Charles W., Executive Ability: Its Discovery and Development, Yellow Springs: 
Antioch Press, 1934; Tead, Ordway, Human Nature and Management, New York: McGraw- 
Hill, 1938; Barnard, Chester I., The Functions of the Executive, Cambridge: Harvard Uni- 
versity Press, 1938; Mooney, James D. and Rciley, Alan C., The Principles of Organization 
New York: Harper, 1939. 



168 THE CHIEF EXECUTIVE 

tinctive public policies, the nation has not been much interested in the 
economy or efficiency they achieved in their administrations. 

Business Leaders. What has been said about the test of success for the 
chief executives of our national government is also borne out in the records 
of American business leadership. These leaders, too, must rely on their 
influence upon others rather than on formal authority if they are to rise 
to the heights. By the nature of things, to a greater degree than in gov- 
ernment, the policies of commercial enterprise, in the sense of final or basic 
goals, are set forth in advance. The objective of business executives is to 
make money through well-planned and efficient production and sale of 
goods or services. The more money they can make for their company, 
the greater their reward. The policy problem does not assume for them the 
proportions it necessarily does in the case of governmental chief executives. 
With this significant qualification, the conditions for executive success in 
both government and business are much the same. 

John D. Rockefeller, Andrew Carnegie, James J. Hill, Owen D. Young, 
Walter S. Gifford, and Alfred P. Sloan became great business executives 
because they were first leaders of men. The secret of their authority among 
their associates and subordinates lay in the continuous demonstration of 
their superiority in intelligence, in imagination, in shrewdness, in daring, 
and in personal magnetism the very qualities recognized by their col- 
laborators as most essential at the highest rung of the executive ladder. 
True enough, volume of stock ownership, family relationship, and per- 
sonal friendship all have a bearing on the selection of top officials in business 
corporations. However, at least among the larger firms, the basic criterion 
is usually capacity for leadership. Responsibility is likely to come to those 
who are most ready and anxious to accept it. 

Governors and Mayors. It is to be expected that the relationship be- 
tween authority and leadership in the case of state and municipal chief 
executives corresponds very closely with our findings about the presidency. 
The great governors have been the champions of the general welfare in 
response to the vital issues of their day; they have earned less acclaim as 
efficient administrators of established programs. It does not alter the gen- 
eral fact to acknowledge that in some cases their most singular achievement 
has been to raise the whole tone and level of public administration for the 
promotion of particular policies. This has often been the necessary pre- 
requisite to an attack upon emerging problems of substantive policy. 

LaFollette of Wisconsin, Smith, Roosevelt, and Lehman of New York, 
Olson and Stassen of Minnesota, Winant of New Hampshire, Murphy of 
Michigan, Saltonstall of Massachusetts, Arnall of Georgia, Warren of Cali- 
fornia these may or may not be the greatest governors to have held office 
in our day. But they are among the elect. And in every instance, their 



THE CHIEF EXECUTIVE 169 

reputation has turned on political leadership rather than on administrative 



attainment. 7 



Generally speaking, policy issues on the municipal level hold rela- 
tively less importance than on the state level and considerably less 
.han on the national plane. Despite this fact, the prestige of a municipal 
^hief executive still depends mainly on the kind of program he sponsors 
and the dynamic qualities of his personality. 8 LaGuardia in New York 
City, Hoan in Milwaukee, Seasongood in Cincinnati, Maverick in San 
Antonio, Wyatt in Louisville, and Lausche in Cleveland none of these 
distinguished mayors has contented himself with being merely a faithful 
steward of "things as he found them." On the contrary, all have carried 
forward new programs supplementing or supplanting the old programs 
that held the promise of making for better community life rather than 
merely more efficient administration. 9 

3. EXTERNAL RELATIONSHIPS 

The chief executive's relations with individuals and groups outside the 
executive branch are bound to absorb much of his time and energy regard- 
less of whether the form of government be presidential or parliamentary. 
However, given the separation of powers and the traditions attendant upon 
it in the United States, such external relations can hardly fail to be of 
the keenest and most continupys concern to the head of the administrative 
machinery of government. Within the governmental framework itself his 
responsibilities are three. He must establish and maintain good relations 
with the legislature, with the judiciary, and depending upon the circum- 
stances with other chief executives. It will be useful to look at each ot 
these separately. 

Relations with the Judiciary. Ordinarily, executive-judicial relationships 
are not especially problematical. Assuming that the measures a chief execu- 
tive has in mind to propose for legislative action do not raise issues of 
constitutionality in terms of court precedents and general judicial disposi- 
tion, he should have little difficulty in living in peace with the judiciary. 
Prudent use of his power of appointment will pay dividends, even though 



7 See the pointed exchange of views "On Governors" between Leonard D. White and 
Frank Bane in Public Administration Review, 1944, Vol. 4, p. 68 ff. f 153 ff. 

8 There are those who argue that the policy element in city and even in state govern- 
ment is not large enough to sustain by itself partisan elections. Suffice it to observe that, even 
after allowing for some diminution on the local level as compared with the two higher levels, 
there is enough policy substance remaining to make the reputation of municipal chief executives 
turn chiefly upon what they stand for in politics. 

9 We can gain a good understanding of the qualities needed in the mayoralty from such 
volumes as these: Rankin, Rebecca, ed., New Yor% Advancing, New York: Municipal Refer- 
ence Library, 1945; Hoan, Daniel W., City Government, New York: Harcourt, Brace & Co., 
1936; Merriam, Charles E., Chicago: A More Intimate View of Urban Politics, New York: 
Macmillan, 1929; Whitlock. Brand, Forty Years of It, New York: Appleton, rev. cd., 1925. 



170 THE CHIEF EXECUTIVE 

in the federal government opportunity for nomination? is controlled by 
death, retirement, or resignation from the bench. 

However, as the epic battle in 1937 between the Supreme Court and 
Franklin D. Roosevelt demonstrated, a "strong man" in the presidency 
is apt not only to bring forward new ideas and programs but also for this 
very reason to run up against the latent conservatism of the judiciary. In 
such a situation, matters do not simply resolve themselves through the 
President's appointive power, because vacancies on the bench may be slow 
to occur. There is, in fact, no readily available constitutional mechanism 
for attaining constructive adjustment under these conditions. The only 
remedy lies in the President's hold on popular support. Not even the 
Supreme Court can afford to stand between a resourceful national leader 
and the majority of the people. 

Relations with the Legislature. In his relations with the legislature, the 
chief executive faces a different situation. Both the legislative and executive 
branches have political functions to perform. Unless they see generally 
eye to eye with each other on the need for public action, government may 
simply have to mark time. And not merely that. Through its power of 
sanction over policy proposals requiring statutory enactment, its control over 
liie public purse, and its confirmation of major appointments by the upper 
chamber, the legislature can do much to facilitate or obstruct day-by-day 
administration. What this adds up to is that presidents, governors, and 
mayors must get along with their legislative assemblies not just occasionally 
but continuously. This is true despite the fact that, by proclaiming the 
separation and independence of powers, the Constitution, together with the 
general tradition born of it, encourages each branch of government to be 
constantly sensitive about the recognition of its prerogatives and its 
coordinate position. 

The prospect of effective government under these circumstances depends 
upon several considerations, each of which the chief executive must exploit 
to full advantage. In the first place, he can capitalize on the fact that in the 
United States, notwithstanding the forces of pressure politics, there is a 
wide consensus on the principle of the priority of the publig_jKelfare over 
private interests. Thus he is able to frame and present his proposals for 
national measures in terms of that consensus. Secondly, by virtue of his 
role as the leader of his party, he can appeal in the name of the party and 
its platform for support of his program from all members of the party in 
the legislative branch. In the third place, he has opportunities to demon- 
strate the depth and sincerity of his desire for cooperation with the legislature 
by showing at all times a generous respect for its high place in the grand 
scheme of democracy, and by collaborating with its leaders to create chan- 
nels and arrangements for full and frequent consultation on matters of 
mutual concern. Lastly, he can try, in a manner designed to avoid the 
appearance of organizing pressure, to use the public interest attaching to 



THE CHIEF EXECUTIVE 171 

his office for generating among the people a climate of opinion that will 
dispose both branches of government toward a common approach to the 
solution of the problems of the day. We may think of "fireside chats" 
broadcast nationally, press conferences, and the like. We should think also 
of much hard bargaining behind the scenes. 

Agency Contacts with Legislators. It may be noted in this connection 
that every major administrative agency has its own contacts with the legis- 
lature. These relations, typically with a legislative committee or individual 
members, inevitably have a bearing on the way in which the chief execu- 
tive gets along with the legislative assembly as a whole. Indeed, in the 
national government the impact of agency-congressional relationships upon 
the President's success in redeeming his campaign pledges and giving effect 
to his program is considerable. Alert courtesies extended by administrative 
agencies to Senators and Representatives, including prompt supply of tech- 
nical information and special attention to the needs of particular con- 
stituents, can do much to create a general good will on the part of the 
Congress toward "the Administration." 

On the other hand, these relations may have another aspect, and one 
grimly detrimental from the President's standpoint. Agency officials have 
sometimes been known to form understandings with members of Congress 
that almost amount to defensive alliances against the fulfillment of certain 
portions of the chief executive's program. Obviously no president can be 
indifferent to the evils of such a situation. Yet he may not be in a position 
to correct it with ease. For if the uncooperative agency official has strong 
backing "on the Hill" or from organized groups having the ear of influential 
elements in the legislature, he becomes virtually untouchable. The chief 
executive's only recourse is to try to outmaneuver or isolate the insubordi- 
nate subordinate. To this extent, administrative hierarchy may break down. 
Nor is the legislative majority better able to check its own entrenched 
minorities in such dealings. 

Relations with Other Chief Executives. When it comes to his relations 
with other men of his own official status, the chief executive will find them 
light or burdensome depending largely on the governmental level of his 
job. In our time, the President has few responsibilities more engrossing than 
those involved in the conduct of foreign affairs. Increasingly, foreign policy 
points toward his own working relations with the heads of other national 
governments, particularly those with basic international interests akin to 
ours. Even when his foreign policy steers through clear waters, these 
relations are apt to absorb more of his time and thought than those with 
all the state governors and municipal executives put together. Nor are 
they likely to require less attention in the foreseeable future. In the after- 
math of World War II we know that the victory we have won at such 
great cost can be made secure only through a cooperative peace. There is 
probably no standard by which presidents and contenders for the presidency 



172 THE CHIEF EXECUTIVE 

will be measured more sharply than that of their standing and their influ- 
ence, actual or potential, in the international sphere. 

Governors and mayors, in dealing with the chief executives of other 
governmental jurisdictions, rarely confront issues as important as those 
faced by the President. In the nature of our governmental tradition, there 
are not as many working contacts between governors and mayors as might 
benefit their public business. On the whole, a mayor's relations with other 
chief executives are likely to be confined to conferences on mutual problems 
with the mayors of neighboring cities, and to his participation with other 
mayors in the activities of his state's league of municipalities and either the 
American Municipal Association or in the case of our metropolitan cities 
the United States Conference of Mayors. As for the governor, he will have 
his main dealings with the governors of adjoining states and with the may- 
ors of his state's largest cities. On other than matters of party politics his 
contacts with the mayors of other cities or with the governors of more dis- 
tant states will be normally quite infrequent, except for those related to 
the Governors' Conference or the Council of State Governments. 

Relations with Political Parties. We may turn now to the chief execu- 
tive's external relations outside the structure of government proper. Here 
his problems fall again into several classes. In point of importance, party 
relationships probably rank first. For it is a plain fact that his strength 
within his party, and in turn the party's strength within the electorate, are 
at the very core of his effectiveness as chief executive. Both aspects he must 
cultivate steadily. It therefore behooves him to counsel frequently with the 
leaders of his party, to keep the party united and aggressive, and so to guide 
its fortunes that it may win and hold the favor of the voters. 

He may count himself fortunate if without inordinate anguish of soul 
he can handle the distribution of public honors and political appointments 
in a way that serves his ends. The management of these matters makes 
up a large segment of what may be called party business. Despite the help 
furnished traditionally by the Postmaster General and the regular party 
machinery, "the Chief" must give his own time to many sometimes trivial- 
seeming items. He must also be available for advice on questions of party 
finance or even on the times and places of major party rallies and radio pro- 
grams, to say nothing of party conventions and their agenda. Nor should 
we overlook the demands on him for securing as much cooperation as is 
attainable from the opposition party or from disaffected elements within 
his own party. 

Public Opinion and Interest Groups. Because of the cardinal role of 
free means of mass communication in democratic government, the Presi- 
dent's relations with the press as likewise those of a governor or a mayor- 
are of peculiar significance. Nothing is more essential to his success than 
that he keep in touch with the people. Newspapers, magazines, the radio, 
and the moving pictures are the main two-way facilities which make close 



THE CHIEF EXECUTIVE 173 

contact possible. An efficient and tactful press secretary will rank among 
his most indispensable personal aides. 

Even with the ablest assistance, however, the President will be obliged 
to give personal attention to what publicity he wants and what political in- 
telligence services he needs. It goes without saying that insofar as his 
direct use of the various media is concerned, he is wise to make the most 
of his particular gifts of expression and make the least of his shortcomings. 
If the press and radio and Hollywood take a friendly line and he learns 
how to cooperate with them, they can do a great deal to build him up and 
keep him before the eye of the public. For, regardless of what history may 
later say of him, here and now he will be what they say he is unless the 
next election shows them to have been quite wrong. 

Interest groups pose a tough problem for every politician who dedicates 
his efforts to the common good, whether he be in the executive or legisla- 
tive branch. The special interest tends to assume something no chief execu- 
tive mindful of his trust would grant that what is good for it will auto- 
matically be good for all the people. It is clear, however, that he cannot 
ignore interest groups in the political arena. * In the first place, it is of the 
essence of democracy that men should be free to associate their efforts in 
promoting interests and enterprises in which they share. -Secondly, it is 
equally essential that government subject the struggle for power among 
interest groups to such regulation and control as is needed to safeguard the 
public welfare. A potent factor in the situation is, of course, the powerful 
influence interest groups often exert over the way in which their members 
vote. Consequently each party is perpetually anxious to win as much of 
their support as possible, or at least to avoid drawing upon itself the antag- 
onism of those groups which cannot be considered as potential supporters. 

Business, labor, agriculture, veterans, civic organizations, and professional 
patriots probably constitute the principal interest groups that presidents and 
governors confront. Municipal chief executives see less of organized agri- 
culture and more of neighborhood councils, social welfare organizations, 
and taxpayers associations. Each of these groups makes up a part of the 
body politic which it is the chief executive's business to serve. The great 
public which he likes to regard as his principal too often turns out to be 
nothing more than a loose composite of little or lesser publics somehow 
bound together by a not always very sharp sense of larger unity. If he 
can consolidate the sense of community a critical part of his job the 
various groups may be induced to keep their selfish impulses under reason- 
able restraint and so be able to make positive contributions to the proper 
functioning of government. If he fails in this greatest assignment as a result 
of personal weakness or of circumstances beyond the power even of a true 
leader, he will learn at first hand what havoc pressure politics may cause. 



174 THE CHIEF EXECUTIVE 

4. INTERNAL DIRECTION AND CONTROL 

The preceding section, treating as it did of external relationships, dealt 
principally with the political aspects of the role of the chief executive. In 
this and the succeeding section, an effort will be made to describe the func- 
tions he performs and the facilities he uses within the executive branch 
itself, the presidency being taken as prototype. 

Administrative Planning and Direction. As administrator-in-chief, the 
President's first task is to decide what kind of general framework of con- 
sensus he may assume or evolve between himself and the legislature, what 
are to be the main aims of his administration, and by what basic policies he 
will work for their attainment. Such anticipations are subject to change; 
yet he needs some point of departure. Next, he must arrange for plans to 
be developed analyzing specific problem areas and outlining alternative 
methods of solution. He must also give thought to an organizational struc- 
ture fitting the logic of his aims, policies, and plans. All of this requires a 
reliable supporting cast. 

One of the President's principal responsibilities is to select the men and 
women who as agency heads will fill the major executive positions within 
his organization. They in turn will have to be depended upon to nominate 
subordinate political officials. Selection and appointment of key officers 
are, however, still in the category of mere preliminaries. All of the subordi- 
nate heads have to be directed to their tasks; it falls to the chief executive 
to convey to them a clear conception of their missions in the government- 
wide context. 

He must require annually of each agency a systematic work program 
supported by estimates~-of expenditures. In order to develop a balanced and 
administratively feasible program for the executive branch as a whole, 
he needs to integrate the agency programs into a single comprehensive 
plan. This is known as the annual budget. No recurrent document he 
submits to the legislature is of greater importance. Upon its presentation 
to Congress in justification of requests for funds it is scrutinized by the 
Appropriations Committee of each chamber. Its subsequent adoption by 
the legislature, usually with considerable modifications, translates the 
budget into the means whereby the President can assure himself systemati- 
cally that the approved work plan of the government is being accomplished. 

Executive Coordination and Administrative Reporting. Even with rea- 
sonably clear policies and plans, a satisfactory scheme of organization, able 
top personnel, foresighted direction in individual agencies, and careful 
programming and scheduling of administrative activities, there is no fool- 
proof guarantee that everything and everybody will mesh nicely so that 
each agency can be left to run by itself. One of the President's most com- 
plicated functions is that of coordinating the efforts and operations of the 
entire executive branch. Of course, the budget itself is an instrument of 



THE CHIEF EXECUTIVE 175 

coordination. Through it the President may even attain a degree of con- 
certed action on the part of the great regulatory boards and commissions 
that in all other respects, except for his power of appointment, are not under 
his command. Considering the national proclivity for agencies which are in- 
dependent of the chief executive, and a tradition of rugged administrative 
individualism even within the executive branch proper, it should be easy 
to understand that coordination of governmental activities, week in and 
week out, is a heavy responsibility and a never-ending one. 

Finally, the President must constantly keep his eyes on the total admin- 
istrative picture. He must make himself a central point of reporting. The 
budget provides the basis for a systematic gathering and analysis "of informa- 
tion. However, the President needs additional channels of intelligence about 
the status of administrative progress. He must be able to find out what 
he should know in order to report effectively to Congress, the press, or 
the public. This calls for special arrangements to provide him with the kind 
and quantity of information he wants, when he wants it. 

Constitutional Supports. These being the President's main administra- 
tive functions, what specific powers and devices does he rely upon to exe- 
cute them ? His prerogative in the field of policy initiative derives from that 
clause in Article II of the Constitution which provides that he "shall from 
time to time give to the Congress information of the state of the Union, 
and recommend to their consideration such measures as he shall judge 
necessary and expedient." In proposing public policy, no chief executive 
would want to act on the spur of the moment. He naturally welcomes 
ideas and suggestions, formal and informal, from a wide variety of sources 
inside and outside government. These, however, have to be sifted and 
evaluated; and a final selection has to be made. Most of the sifting and 
appraising can be entrusted to his permanent staff establishments. Often, 
however, even after they have done their best, he will still need help in 
"making up his mind." He may put the matter to the Cabinet or consult 
with individual members. He may call in the leaders of Congress. Or he 
may seek the confidential counsel of a Colonel House or a Harry Hopkins. 
There is perhaps undue fluidity in this pattern, but without a more highly 
developed presidential secretariat we can hardly expect a material change. 

No provision in the Constitution specifically requires or authorizes the 
President in so many words to "plan" his general program. Yet his need 
and right to do so would appear to be implied in the constitutional provi- 
sion that "he shall take care that the laws be faithfully executed," and in 
another clause appearing earlier in Article II that "he may require the 
opinion, in writing, of the principal officer in each of the executive depart- 
ments, upon any subject relating to the duties of their respective offices," 
Even without these clauses, however, the necessity for him to anticipate the 
future would remain. He would have to prepare for it even though his 



176 THE CHIEF EXECUTIVE 

authority might be derived from "the law of the situation" 10 rather than the 
law of the Constitution. 

With respect to administrative organization, the President's powers are 
limited. Permanent administrative agencies no less than the so-called inde- 
pendent establishments are the creations of Congress. None of them can 
be broken up or recombined in different ways or merged with other agen- 
cies except by statute. There is a strong case to be made for investing the 
President with permanent authority to adapt administrative structure to 
governmental needs, but so far no such continuing authority has ever been 
granted. Temporary grants of specifically circumscribed power to work out 
structural adjustments have been made in the Reorganization Acts of 1939 
and 1945. In times of war the President is likely to obtain special authority 
of this kind, such as the two War Powers Acts of World War II and the 
Overman Act of World War I aside from his automatically operative 
war powers, which are of considerable scope. 

The power of appointment and by implication of removal is one of 
the most telling the chief executive possesses. Article II of the Constitution 
provides that he 

. . . shall nominate, and by and with the advice and consent of the 
Senate, shall appoint ambassadors, other public ministers and consuls, 
judges of the Supreme Court, and all other officers of the United States, 
whose appointments are not herein otherwise provided for, and which 
shall be established by law: but the Congress may by law vest the appoint- 
ment of such inferior officers, as they think proper, in the President 
alone, in the courts of law, or in the heads of departments." 

The removal power, held by the Supreme Court corollary to the appoint- 
ing power j 11 continues to be extensive but was definitely qualified in the 
Humphrey case. 12 Corwin summarizes the present situation in this way: 18 

As to agents of his own powers, the President's removal power is 
illimitable; as to agents of Congress* constitutional powers, Congress 
may confine it to removal for cause, which implies the further right to 
require a hearing as a part of the procedure of removal. 

In the exercise of his directive function over the various administrative 
agencies but not the independent regulatory boards and commissions 
the chief executive is supported by several provisions of the Constitution, 
chiefly by the very first sentence of Article II: "The executive power shall 
be vested in a President of the United States of America." That broad 
grant would perhaps have sufficed of itself to empower the President to 

10 For the insight embodied in this phrase, students of administration are indebted to a 
brilliant and practical woman, Mary Parker Follett. Sec her "Individualism in a Planned 
Society" in Mctcalf, Henry C. and Urwick, L., cds. Dynamic Administration, New York: 
Harper, 1942. 

U Myers v. United States, 272 U. S. 52, lia (1926). 

12 295 U. S. 602 (1935). 

13 Op. cit. above in note 6, p. 96. 



THE CHIEF EXECUTIVE 177 

issue such orders as he might find necessary or expedient in directing the 
administrative operations of the executive branch. In addition, however, 
certain other provisions are relevant. Among them are the express stipula- 
tion in Section 2 of the same article that he "shall be commander in chief 
of the Army and Navy of the United States, and of the militia of the several 
states, when called into the actual service of the United States," and the 
more general clause, already cited, that he "shall take care that the laws be 
faithfully executed." 

However, uncontested authority to direct the executive branch proper 
does not ensure informed and competent direction. The problem is how to 
make it effective. One of the first needs is a system of administrative com- 
munication that will flash up to the chief executive the institutional intelli- 
gence he requires from all sectors of his entire organization, and simul- 
taneously will guarantee that his orders and his general line, of approach 
will get through without distortion or delay to those on the lower levels of 
command. 

Statutory Implementation. Work programming and budgeting are basic 
to sound administration, but the President has had the machinery to per- 
form these functions systematically only for a bare quarter-century. The 
Budget and Accounting Act of 1921 furnished him specialized staff assistance 
in a Bureau of the Budget operating primarily by reliance on his own direc- 
tive power. 14 The administrative histories of the states suggest the same 
lesson: that until a government adopts the idea of the executive budget 
and preferably with the item veto that is lacking in the federal government 
it is futile to expect effective and economical administration. Of course, 
adoption of such a system will not automatically bring anything like the 
administrative millenium. Without it, however, the gates to progress will 
open only halfway. 

Like the directive power, of which it may be said to be a derivative, the 
power to coordinate is general in the character of its application. It rests 
fundamentally upon the same clauses in the Constitution listed as the sources 
of the directive power. Beyond that it has been made explicit in the Budget 
and Accounting Act and other statutes in which Congress has reaffirmed the 
President's obligation to unify the operations of the various administrative 
agencies it has created. One notable recent example is the Employment Act 
of 1946, under which the President is to avail himself of a new Council of 
Economic Advisers to convey to the legislature ways and means of attaining 
maximum employment throughout the nation by concerted governmental 
action. 

As a source of central information about the national administrative 
system, the chief executive is the logical agent reporting on progress of 
operations and policy problems to Congress or the public. The legislature 

14 Sec Morstcin Marx, Fritz, "The Bureau of the Budget: Its Evolution and Present Role," 
American Political Science Review, 1945, Vol. 39, p. 653 ff., 869 ff. 



178 THE CHIEF EXECUTIVE 

usually requires such reports in statutory language written directly into 
acts enabling or directing him to launch new undertakings. A good example 
is the reporting on the progress of the lend-lease program during World 
War II. We may also think of the annual message on the State of the Union 
and the annual budget message. In 1946, both were combined for the first 
time in a single document because the two messages increasingly tended to 
deal with the same fundamental issues of healthy economic, social, and fiscal 
development of our national order. Most other messages address themselves 
to particular matters. 

By far the larger body of data and proposals, however, emerges in 
administrative self-reporting within the executive branch. This is the 
method and the only one by which the President can hope to keep him- 
self abreast of what is going on at the administrative front-lines and what is 
being done in his name by the army of federal employees deployed all over 
the country and our outposts abroad. Without staff work to harness this vast 
flow of information, it could easily turn into a destructive torrent. Facts, 
figures, and suggestions must be transformed continuously into information 
serviceable to the chief executive f on control purposes. 

5. ARMS OF MODERN MANAGEMENT 

Need for Assistance to the President* "The President needs help." So 
wrote the President's Committee on Administrative Management headed by 
Louis Brownlow in its report submitted January 8, 1937. In assigning 
functions and responsibilities to the executive branch the Constitution and 
the statutes simply ordain that "the President" shall do thus and so. 
Obviously no man, whatever his genius, could personally perform the many 
and heavy tasks which the chief executive thus is obliged to take on. It 
is to him in his institutional capacity to his office that the assignments 
are made; and, except where Congress has itself fixed the means, he is 
expected, within the bounds of statutory authority and funds appropriated, 
to recruit, organize, and direct whatever personnel may be required for the 
work to be accomplished. 

Here, with the sole exception of the chairmanship of the Council of 
Ministers of the Soviet Union, is clearly the biggest management job 
in the world. How does the President handle it? What aides and facilities 
does he need to help him get his work done? True, the great line depart- 
ments are the instruments through which ultimately the purposes of the 
federal government are carried into effect. But what are the means by 
which the President makes sure that they know of his intentions and 
expectations and that he knows how well they are succeeding in their 
tasks? 

It was the general conclusion of the President's Committee on Adminis- 
trative Management that: (1) the President needed, in addition to his per- 
sonal secretaries, as many as six administrative assistants on his immediate 



THE CHIEF EXECUTIVE 179 

White House staff; (2) in the tasks of executive management he should 
have the assistance of three main "arms," one for planning, one for budget- 
ing, and one for personnel; (3) with such internal arrangements as would 
meet the special problems presented by regulatory commissions and govern- 
mental corporations, all line agencies should be consolidated into twelve 
departments, each headed by a secretary of Cabinet rank; and (4) there 
should be a reordering of the functions of the General Accounting Office to 
ensure two things that, on the one hand, auditing prior to spending should 
no longer keep the wheels of administration from moving; and that, on the 
other, the executive branch should be made more effectively accountable to 
Congress by more searching and more constructive post-auditing. 

How fully House and Senate would have accepted these recommenda- 
tions if President Roosevelt had not followed their submission with his 
provocative message on Supreme Court reform, no one can say. In any 
event, the Reorganization Act of 1939 incorporated only part of the pro- 
posed measures. Above all, the President was granted six administrative 
assistants, and a legal foundation was laid for the establishment of the 
Executive Office of the President perhaps the most significant step .forward 
since the Budget and Accounting Act of 1921. The Executive Office was 
made up of the National Resources Planning Board, 15 the Bureau of the 
Budget, the Liaison Office for Personnel Management, the Office of Gov- 
ernment Reports, and the Office for Emergency Management. 18 This last 
division of the Executive Office subsequently allowed the President desirable 
leeway for locating in it even if by legal fiction many of the great war- 
time control agencies. 

Notwithstanding the later abolition by act of Congress of the National 
Resources Planning Board and the administrative elimination of the Office 
of Government Reports, the Executive Office of the President has continued 
to serve essential purposes. Its principal remaining element, the Bureau of 
the Budget, has gone far to give the President highly diversified staff assist- 
ance. Under the Employment Act of 1946, its services have been amplified 
by a Council of Economic Advisers, placed by law in the Executive Office. 
Technically outside the Executive Office but in fact linked to it have been two 
other important presidential agencies: the Office of War Mobilization and 
Reconversion 17 and the Office of Economic Stabilization, both devoted more 
to policy development than to administration. 

Realigning the Executive Branch. As to changes in the departmental 
structure, those authorized under the Reorganization Act of 1939 and subse- 
quently adopted in the form of presidential "plans" were not insignificant. 

18 Sec above Ch. 6, "Planning and Administration," sec. 2, "The Machinery for Plan- 
ning." 

16 See Brownlow, Louis and Others, "The Executive Office of the President: A Sym- 
posium," Public Administration Review, 1941, Vol. 1, p. 101 ff. 

17 See above Ch. 6, "Planning and Administration," sec. 2, "The Machinery for Plan- 
ning." 



180 THE CHIEF EXECUTIVE 

Yet the executive branch emerged from World War II in need not only of 
reconversion to a peacetime basis but of further reorganization for the 
general purpose of increasing its effectiveness. Authorization to propose 
such modifications not extending to certain exempted establishments was 
conferred upon the President in the Reorganization Act of 1945. 18 Leaving 
aside the point that authority to reorganize administrative structure is in 
the nature of a continuing necessity and should therefore not be granted only 
for a limited time, how can the chief executive best use such power as is now 
vested in him? If he wants to make it serve general needs, he will try to 
accomplish five main goals. 

First, he will weigh opportunities for regrouping and consolidation 
among and within line or operating agencies to effect better service, check 
duplication, and reduce the span of control for himself and the departmental 
leadership. Of course, this does not apply to those establishments which are 
set apart by reorganization statute. We may expect an integration of the 
War and Navy Departments into a single Department of Defense. In 
addition, the President may find it possible to consolidate various agencies 
with othjer main departments. It has even been argued that the number of 
departments can and should be reduced to seven. Experience suggests, 
however, that no change quite so drastic could win acceptance. Moreover, 
too heavy concentration along this line might in turn overtax departmental 
leadership. 

Central Staff Facilities. Second, the President may want to reexamine 
arrangements for the conduct of central staff and auxiliary services 
such as budgeting, recruitment and examination of personnel, in-service 
training, purchasing, accounting, printing, safety facilities, and the like. 
Here the aim would be to gain for the federal government whatever 
advantages can be derived from centralized staff and housekeeping activities, 
while yet leaving in each department adequate means as well as full 
authority and responsibility for getting its job done. This might also entail 
the removal or mitigation of the hazards and impediments to sound manage- 
ment within the executive branch which are latent in the opportunities the 
General Accounting Office has of intervening in an unproductive manner 
in administrative operations. There is every reason for insisting on a 
careful audit of all records after an individual administrative transaction 
has been completed. But there is no good reason for the kind of supervision 
by the Comptroller General as head of the General Accounting Office that 
has developed in federal administration. Ideally, as the President's Com- 
mittee on Administrative Management proposed, Congress should not only 
retain an auditor general for the final examination and certification of 
accounts, but it should also demand of him a truly comprehensive annual 

18 Again, as under the Reorganization Act of 1939, the "hard core" of independent regula- 
tory agencies such as the Interstate Commerce Commission and the Securities and Exchange 
Commission was exempted, including the civil functions of the Army Corps of Engineers. 



THE CHIEF EXECUTIVE 181 

report on the character of fiscal operations and the general performance of 
the executive branch. 

Executive Office of the President. Third, the President must consider 
again the adequacy of his own staff establishments. The theoretical premises 
of the Executive Office of the President have proved sound; and the Presi- 
dent needs all the help he can get from that office. 19 Increasingly since 
1939, the Bureau of the Budget has grown into that great arm of overhead 
management which is the intent of the Budget and Accounting Act. In 
Arthur Macmahon's descriptive phrase, the bureau has become the "em- 
bodiment of the presidency" in federal administration. 20 Through its 
several divisions Estimates, Fiscal, Legislative Reference, Administrative 
Management, Statistical Standards the chief executive obtains continuing 
assistance in the preparation and execution of the annual budget; in the 
clearance and coordination of agency proposals for legislation or views on 
pending bills; in the achievement of better organization and management 
throughout the executive branch; in the coordination of federal statistical 
services; and in the analysis of government-wide or departmental programs, 
of issues or implications of fiscal policy, and of the progress of administrative 
operations. 21 

The situation is different with regard to forward-looking policy plan- 
ning. Harried as the President tends to be by immediate concerns, he re- 
quires first-rate advice if he is to think wisely or think at all about the 
state of the Union a decade or generation hence instead of a year or two. 
There was provision for that kind of help as long as the National Resources 
Planning Board was still in existence. Since 1943, when Congress cut off its 
appropriations, it has been necessary for the President to rely on catch-as- 
catch-can planning services wherever he could get them, even if only in bits. 
Criticisms of the reconversion program have time and again shown up the 
unwisdom of abolishing the National Resources Planning Board. Sooner 
or later, its equivalent will have to be reestablished. Perhaps the new statu- 
tory Council of Economic Advisers, set up in the Executive Office of the 
President by the Employment Act of 1946, will eventually develop into 
such an equivalent. 

The case for a director of personnel to give the President expert counsel 
and, as civil service administrator, to direct the operations of the present Civil 
Service Commission, is almost equally persuasive. True, the present arrange- 
ment of a Liaison Office for Personnel Management within the Executive 

19 This does not mean, of course, that there should be maintained in the Office for 
Emergency Management skeleton agencies or technical staffs actually not needed. As its name 
suggests but docs not fully explain, this office serves its purpose in the main by providing 
an ever-ready legal and administrative framework within which temporary emergency agencies 
can be created when required, provided that funds are made available for such agencies by 
Congress. 

^Macmahon, Arthur W., "The Future Organizational Pattern of the Executive Branch," 
American Political Science Review, 1944, Vol. 38, p. 1182. 

21 See Morstcin Marx, he. cit. above in note 14, p. 869 ft. 



182 THE CHIEF EXECUTIVE 

Office, clearing on matters of presidential interest with the Civil Service 
Commission, has not been unworkable. Yet it remains essentially a make- 
shift that should be superseded. The President is as much in need of having 
his own director of personnel as are other chief executives. Few problems 
lie closer to the heart of administration than that of staffing of discovering, 
recruiting, placing, and developing competent employees so that they can 
produce at top capacity. Solution of this problem should grow out of con- 
scious design and not have to depend upon favorable circumstances in the 
relations between the President and a so-called independent establishment, 
the Civil Service Commission. 

Policy Coordination. The fourth goal of administrative reorganization 
relates to the equivalent of that office whose head used to be spoken of as 
"Assistant President," "Coordinator of Domestic Affairs," or "Secretary of 
Domestic Policy" more often than as Director of War Mobilization and 
Reconversion. 22 By statute, this office is both temporary and outside the 
Executive Office of the President. If the President needs a special staff officer 
to coordinate domestic policy, much as the Secretary of State oversees 
foreign affairs, he would be well advised to place such an aide and his staff 
in the Executive Office as exponent of directive coordination, in com- 
parison with the functions of managerial coordination that are being dis- 
charged by the budget director. 23 If this were done, it would be possible at 
the same time to carry further the institutionalization of the Executive Office. 
It still needs better inner balance of policy development and administrative 
concerns; better integration of its working processes, including the White 
House staff in the technical sense; and better facilities for checking back and 
forth on all matters that come to the President's desk. 

Potentialities of the Cabinet. The fifth and final goal for which the 
President should strive as part of any reorganization is to make greater use 
of his underdeveloped Cabinet. Ample delegation of authority and respon- 
sibility by the President to the heads of his line establishments and consolida- 
tion of his own staff contribute greatly to success in administration. How- 
ever, the problems and concerns of the departmental system ramify so 
widely and intertwine so perplexingly that the chief executive must seek to 
arrange for the main agencies to share them with him through discussion 
and decision in the Cabinet. As a collegial body, the Cabinet could serve as 
a forum for debating general policy recommendations, and aid the President 
in formulating such proposals in true teamwork. 24 Cabinet committees, with 
the participation of specialized top personnel, could set themselves the task 
of finding a common approach to major policy issues and of devising a 
pattern of combined operations for giving effect to considered solutions. 

22 See above Ch. 6, "Planning and Administration/' sec. 2, 'The Machinery for Plan- 
ning." 

23 See Morstein Marx, he. cit. above in note 14, p. 898. 

24 Cf. Macmahon, loc. cit. above in note 20, p. 1 187. 



THE CHIEF EXECUTIVE 183 

Cabinet meetings might well include the key men of the President's Execu- 
tive Office. This is but hopeful speculation, for it is one of the distinctive 
facts about our federal government that the Cabinet lives in a kind of 
dormant state as a device for making policy. However, one thing is certain. 
That President who first exploits the collective potentialities of the Cabinet 
as a regular and systematic practice will make a signal contribution to Amer- 
ican public administration. 



CHAPTER 



The Departmental System 

1. GENERAL FEATURES 

Purpose of Departmentalization. We speak of departments when dealing 
with parts of a whole. The whole may be a unified territory; thus, the French 
departements are areas into which the country is divided for governmental 
purposes. Or the whole may be the total structure of political organization; 
thus, we often refer to the three main powers of government, set apart from 
one another under our Constitution, as the legislative, executive, and judicial 
departments. Or the whole may be the machinery of administration com- 
bined in the executive branch; thus, [we have long recognized the need for 
some division of labor in the administrative system by grouping more or less 
related functions under formally designated departments^ It is with depart- 
mentalization in this last sense that we shall here be concerned. 
^Departmentalization, being in essence a division of labor, is intended to 
make more effective rather than split up the whole within which it is 
applied.1 When organizations grow to the point where direction and control 
can ndlonger be exercised in face-to-face contact between the leader and the 
rank and file, intermediate stages of leadership must be supplied. Such 
arrangements though marking out the component parts within the whole 
make it possible to keep the organization in formation and to attain efficient 
use of specialized skills. In determining the scope of responsibility on each 
of these intermediate stages or at each point of subdivision, consideration 
must be given to two elementary propositions. First, it is essential to achieve 
the greatest measure of operational unity within every subdivision. Second, 
it is necessary to establish sound working relationships among all sub- 
divisions. 

This is in the main a matter of economy of control. Subleadership is 
hopelessly overburdened when compelled to putf together scattered frag- 
ments of different activities. It is also easy to/see that the demands on sub- 
leadership are not always of the same chararewv In large-scale organizations, 
public and private, the higher intermpdlatfe itages usually require special 

184 



THE DEPARTMENTAL SYSTEM 185 

capacity for ranging over broader fields and for marshaling sizable forces 
in close relationship to the aims of the organization as a whole. On the 
other hand, subleadership on the lower intermediate stages down to the 
first-line supervisor increasingly calls for technical competence with respect 
to specific operations. Even the first-line supervisor, however, is in a very 
practical sense an agent of the leader of the entire organization, assisting 
him in attaining the ends of the organization at large. 

The way in which the whole is reenforced through identification of its 
parts and their interrelations provides the general framework of adminis- 
trative organization. Hierarchy, lines of command, levels of responsibility 
and channels of administrative communication find their proper place within 
this framework. Departmentalization represents the highest intermediate 
stage of leadership in relation to the chief executive, but it is only one stage. 
Layer after layer, division of labor and delegation of authority progress 
downward throughout the departmental system. Nevertheless, the first 
order of division, on the departmental plane, is of decisive importance in 
giving shape to the bulk of the lower structure. That is why departmentali- 
zation, however academic much of the discussion about it may be, is any- 
thing but an academic matter. 

Structure of the Departmental System. In one form or another, and 
under varying labels, departmentalization occurs in all organized enterprise 
except the smallest kind. The Phillips Petroleum Company, for instance, 
maintains no less than twenty-one departments, such as production, refining, 
traffic, and sales on the one hand; and engineering, research, economics, and 
public relations on the other. The Rochester Gas and Electric Corporation, 
another illustration chosen at random, operates through about eighteen de- 
partments, some of which are in the nature of subdivisions of the main de- 
partments. 1 To mention a few examples in the field of government, Ten- 
nessee, under the reorganization acts of 1923 and 1937, placed the following 
departments under its governor: administration, finance and taxation, high- 
ways and public works, conservation, agriculture, insurance and banking, 
labor, education, public health, and institutions and public welfare. 2 The 
mayor of Boston exercises authority, wholly or in part, over a much larger 
number of departments, including fire, health, hospital, public welfare, 
institutions, building, city planning, street laying-out, public buildings, 
school buildings, public works, transit, park, market, weights and measures, 
and library and art. 8 The village manager of Winnetka, Illinois, has only 
five full-fledged departments to be concerned with police, fire, health, pub- 

1 Scc Metropolitan Life Insurance Company, Policyholders Service Bureau, Business Organi- 
zation, supplemental exhibits A and C, New York, 1944. This is one of a series of helpful 
reports on business management. 

2 See Buck, A. E., The Reorganization of State Governments in the United States, p. 229, 
New York: Columbia University Press, 1938. 

3 See Boston Municipal Research Bureau, Report, p. 4, Boston, Oct. 1937. 



186 THE DEPARTMENTAL SYSTEM 

lie works, and water and electric. 4 The number of federal executive depart- 
ments has been kept to ten; listed on the basis of seniority, they are: State, 
War, Treasury (the original trio since 1789), Navy (1798), Interior (1849), 
Agriculture (1862) Justice (1870), Post Office (1872), Commerce (1903), 
and Labor (1913). 5 

Considering the actual scope of federal activities, it may at first glance 
look like a marvelous accomplishment that the chief executive of the nation 
can direct these activities through so few departmentsless than a third of 
the number of departments that cluster about the Prime Minister in Eng- 
land. But the first glance is sadly deceptive. Historically, we started out 
well enough. The Founding Fathers, with a remarkably acute sense of 
administration, took great care in drawing the outlines of a unified executive 
branch. However, significant departures occurred with the creation of 
establishments independent of the President save for his appointing power. 

The principal landmarks in this new development were the Civil Service 
Commission (1883) and the Interstate Commerce Commission (1887), 
both regulatory bodies the former vested with virtual autonomy in recruit- 
ment for federal service and the latter well-nigh uncontrolled in its control 
over the national transportation system. Through the years, a baker's dozen 
of similar agencies came forth on the precedent of these two. Add to this 
the proliferation of governmental corporations and separate authorities, 
and we have a picture of the diversity and diffusion which confronts the 
chief executive. How can he perform his constitutional duties as head of the 
administrative organization, asked the President's Committee on Adminis- 
trative Management in 1937, when he must deal directly with one hundred 
federal agencies of one kind or another? 6 The Reorganization Act of 1939 
authorized some integration subject to statutory limitations, but fell short of 
achieving anything like a final solution. How far the Reorganization Act 
of 1945 will carry us in this respect, remains to be seen. 

Much the same situation prevails in state and local governments. Inde- 
pendent boards and commissions, together with other unattached authorities 
of comparable status, in many jurisdictions compete with the departmental 
machinery controlled by the governor or mayor. The chairman of a munici- 
pal police commission, for example, may exercise greater power than the 
nominal principal executive of the city. Moreover, most state and local 
governments are still paying heavy tribute to the long ballot of old, which 

4 See Village of Winnctka, III., Annual Report for the Fiscal Year ending March 31, 1943 
p. 2. 

6 General reference may be made in this context to the United States Government Manual, 
the official handbook of the federal government, which appears in up-to-date editions at short 
intervals and which may be obtained from the Superintendent of Documents, Government 
Printing Office, Washington, D. C. 

6 See President's Committee on Administrative Management, Report with Special Studies, 
Washington: Government Printing Office, 1937. The findings and recommendations of this 
committee have exerted considerable influence on subsequent developments and still represent 
an important source of pertinent information. 



1KB DEPARTMENTAL SYSTEM 187 

was based on the philosophy that most, if not ail, offices should be filled by 
election. Elective officials such as recorder, treasurer, and comptroller, hold- 
ing office by statutory or even constitutional provision, may be thorns in the 
flesh of the state or local chief executive. Since the beginning of this century, 
measurable progress has been made toward raising governors and mayors 
to true responsibility for the executive branch, and the continuous spread of 
the council-manager plan of municipal government has worked in the same 
direction. However, an integrated system of administration is even now the 
exception rather than the rule, despite many notable instances of state and 
local reorganization. 

Factors in Departmentalization. Lest our failure to evolve a fully satis- 
factory executive structure be seized upon as evidence of governmental 
floundering, it must be stressed that departmentalization is fraught with 
complexities. 7 These are in part technical, in part political. From a technical 
point of view, it is difficult to determine with assurance the proper basis of 
departmental organization. Should it be identity of major purpose to be 
served or function to be exercised, such as national defense, social welfare, 
and urban development? Or should it be the nature of the process or the 
primary skill involved in it, such as engineering, licensing, and mimeo- 
graphing? Or should it be the group of people to be serviced, such as 
farmers, veterans, and small businessmen? Or, finally, should it be the 
territory or area on which activities should be focused, such as New England, 
the Missouri valley, and downstate Illinois? Speculating on the feasibility 
of each such basis, we are bound to discover soon that its strict and exclu- 
sive application leads simultaneously to two undesirable consequences. First, 
activities that belong together as components of a concrete administrative 
end-product are torn apart at various points and in varying ways. Second, 
if reasonable concessions are made to a combination of activities in what 
might be termed an organic manner and with an eye to the end-product, 
activities of the same kind appear in conjunction with others at many 
different places in the executive branch. 

Classification of conceivable bases of departmental organization, being 
"one of convenience alone," 8 is therefore merely a useful starting point for 
trying to piece together the jigsaw puzzle. How to manipulate the classi- 
fication for practical ends is quite another matter. Admitting its inability 
to lay down a few simple rules of the game, the Brookings Institution, 

7 See Gulick, Luther, "Notes on the Theory of Organization," in Gulick, Luther and 
Urwick, L., eds., Papers on the Science of Administration, p. 3 ff., New York: Institute of 
Public Administration, 1937; Brookings Institution, Report to the Byrd Committee on Organi- 
zation of the Executive Branch of the National Government, Senate Report No. 1275, 75th 
Cong., 1st Scss., Washington: Government Printing Office, 1937; Wallace, Schuyier C., Federal 
Departmentalization: A Critique of Theories of Organization, New York: Columbia University 
Press, 1941. See also above Ch. 7, "Working Concepts of Organization." 

8 Benson, George C. S., "Internal Administrative Organization," Public Administration 
Review, 1941, Vol. 1, p. 473. 



188 THE DEPARTMENTAL SYSTEM 

advising a congressional committee several years ago, suggested a cautious!) 
eclectic approach: 9 

No single factor can be decisive throughout the entire organization. 
One factor may help us to decide at one point; elsewhere, another factor 
may be more helpful. At every point one determinant must be balanced 
against another. For some functions and some agencies there may be 
no one best course of action. A choice may be presented between alterna- 
tives, one as desirable as the other. 

This does not sound very encouraging, but it contains more than a grain 
of truth. Study of departmentalization, like all administrative analysis, re- 
quires careful penetration into the total situation in which the problem to 
be solved is lodged. Technical knowledge, even when tested in the hard 
school of practical experience, is of little avail unless its application is pre- 
ceded by painstaking and skillful diagnosis, not only of the ill to be reme- 
died, but also of all the factors that bear upon both the ill and the possible 
remedies. 

Aside from its technical compexities, departmentalization is also beset 
with political issues. No sooner has a department been established than it 
will become enamoured with itself. However extraordinary the conglomera- 
tion of activities packed into it by way of compromise, it will presently 
associate itself with each of them in unfaltering fondness. Talk about 
shifting any of these activities to some other department as subsequent 
events may indicate to be the better logic and argument breaks loose. Then 
also, departmental officialdom naturally inclines toward taking an expansive 
view of the department's mandate. As the department grows bigger and 
better (which to its leadership may be one and the same thing), it inevitably 
begins to impinge upon related activities carried on by other departments. 
Again, there will be a lot of fussing and fuming when lines of demarcation 
must be redrawn. Each time the department will muster persuasive reasons 
for keeping what it has "always" had, or what "belongs to it" at least by 
implication; and its arguments are likely to evoke a vigorous echo among 
the loyal clientele of special interests and pressure groups that have lined 
up within its ramparts. Usually the noise alone is enough to intimidate 
reform. 

Moreover, executive reorganization is a somewhat obscure art and 
more than a little suspect among the entrenched interests inside and outside 
the departmental system. Suspicion begets hostility and resistance. Institu- 
tional resistance may be deliberate, but it may arise also from the inertia 
of settled form. The cumulative effect has been one of inordinate immobility. 
Looking at the departmental structure, we may be reminded of "monsters 
with great defensive power developed at the expense of movement and 
intellect," as Pendleton Herring has so aptly put it. 10 

9 Op. fit. in note 7, p. 43. 

10 "Executive-Legislative Responsibilities," American Political Science Review, 1944, Vol. 
38, p. 1161. 



THE DEPARTMENTAL SYSTEM 189 

In the face of such "monsters," the feeble voice of organizational com- 
monsense is none too effective. Exceptional circumstances must come to the 
fore in order to provide the psychological moment for thoroughgoing 
realignment. Circumstances of this kind are relatively rare. But they are 
frequent enough to warrant continuous structural planning by a central 
staff agency such as the Bureau of the Budget in the Executive Office of the 
President. Continuous planning is necessary because changing national 
needs and emerging reorientation of policy usually affect the departmental 
system to a greater or lesser extent. Here, as elsewhere, preparedness pays. 
When the day for constructive action arrives, the whole opportunity may 
hinge on the immediate availability of fully considered proposals for 
reorganization. 

Undirected Growth. The technical and political difficulties which sur- 
round departmentalization account in large measure for the fact that the 
structure of the executive branch has been traditionally the product of 
"undirected growth," in Leonard D. White's descriptive phrase. To put 
it differently, rarely if ever have we tried to project existing and emerging 
governmental activities in terms of a comprehensive organizational plan. 
On the other han|J, judging by our experience with state and local reorgani- 
zation, we must admit that a neatly conceived general formula yields only 
limited results unless its application is accompanied by a change of insti- 
tutional atmosphere. This would have to include a corresponding strength- 
ening of enlightened management, a better personnel system, and greater 
legislative self-restraint in tampering with the departmental scheme on 
partisan impulse. Reorganization has been abused as a political football 
more often than we might think. Nor has the game lost its attraction to 
those who know how to play. A notable recent instance occurred in 1945 when 
the Senate was asked to confirm former Vice President Henry A. Wallace 
as Secretary of Commerce. He had proved himself earlier an able Secretary 
of Agriculture. Yet confirmation was attainable only after responsibility 
for extensive governmental credit activities had been severed from the 
Department of Commerce and made the concern of a separate agency. 

The alliance between institutional inertia, vested interests, and political 
partisanship throws an enormous weight of support behind the departmental 
status quo. Stability of organization is in itself an asset, because for greatest 
efficiency everyone must know his way within the organization as a matter 
of habit. Indeed, habit born of repetition or indoctrination minimizes the 
effects even of grossly deformed organization. However, stability becomes 
a vice when it is maintained at the price of structural simplicity and balance. 
It shows itself as a particularly serious vice when we consider the usual time 
lag between established governmental form ajid the evermoving substance 
of social and economic life. On practical grounds, therefore, we should 
strive for a permanent legislative-executive arrangement under which appro- 
priate organizational adjustments and modifications in the executive branch 



190 THE DEPARTMENTAL SYSTEM 

can be made in harmony with changing needs. The legislature would pro- 
vide the frame of reference, and the chief executive would take action 
within the scope of his authorization. This is what Herbert Hoover, then 
Secretary of Commerce, proposed in 1924 before the Joint Congressional 
Committee on the Reorganization of the Administrative Branch. The 
Reorganization Act of 1939 though conceding only temporary authority 
followed the line of Hoover's reasoning. It called for reorganization plans 
formulated by the President to be submitted to Congress, which reserved 
to itself the right of disapproval. 11 Under the Reorganization Act of 1945, 
the same general prescription has been used for the postwar period, because 
the two War Powers Acts of World War II temporary grants of merely 
temporary effect modeled on the Overman Act of World War I were 
designed specifically for only war-emergency duration. 12 

Because departmentalization aims to increase the effectiveness of the 
whole rather than partition it, the number of main divisions is important 
from the angle of direction by the chief executive. His physical span of 
control is naturally limited. Reasonably exact measurement would differ 
with different personalities. But for each personality the limit is easily 
reached, especially if we keep in mind that a smaller numfcer of departments 
in turn may involve too wide a span of control for the department heads, 
thus shifting the problem to the next lower level. Inflexible restriction of 
the number of departments is therefore no adequate answer, whether such 
restriction be imposed constitutionally, as it has been in several states, or by 
statute, as it was in the Reorganization Act of 1939, here primarily as a check 
on the President's range of structural choice. 

Quasi-Departments. Although no new "departments" were to be created 
under the Reorganization Act of 1939, three quasi-departments came into 
being: the Federal Security Agency, the Federal Works Agency, and the 
Federal Loan Agency. Each absorbed into itself a multitude of adminis- 
trative establishments, many of which had formerly not known a common 
denominator. We may doubt very much whether the grouping of quite 
diversified lending activities under a quasi-department and hence without 
close relationship to broader substantive programs was a sound move. The 
fact remains, however, that the three new agencies brought measurable 
relief to the overburdened chief executive. As for internal integration within 
each new agency, it is hardly surprising that initially there was more 
similarity to a holding company than to a department. 

11 For greater detail see Millett, John D. and Rogers, Lindsay, "The Legislative Veto 
and the Reorganization Act of 1939," Public Administration Review, 1941, Vol. 1, p. 176 ff. A 
brief history of federal reorganization efforts may be found in Meriam, Lewis and Schmccke- 
bier, Laurence F., Reorganization of the National Government, p. 181 ff., Washington: Brook- 
ings Institution, 1939. 

12 For an illuminating and authoritative preview, see Brownlow, Louis, "Reconversion of 
the Federal Administrative Machinery from War to Peace," Public Administration Review, 1944, 
Vol. 4, p. 309 ff. The author served as the chairman of the President's Committee on Adminis- 
trative Management; see above note 6. 



THE DEPARTMENTAL SYSTEM 191 

The common denominator does not spring from mere pronouncement. 
It must be fostered systematically over a longer period before it translates 
itself into a point of view commonly shared throughout the agency. In 
general, formation of quasi-departments is an ingenious device for provid- 
ing the executive branch with an experimental fringe. Activity groupings 
may thus be tried out in practice, and legislative assent to full departmental 
status may be bought by demonstration of performance. This applies also 
to such essentially permanent establishments as the National Housing 
Agency, a merger of several no longer novel federal programs which might 
have come about under the Reorganization Act of 1939 but actually took 
place under the First War Powers Act of 1941 and thus required further 
legislation for its continued effectiveness. 

2. INTERDEPARTMENTAL COORDINATION 

Before the consolidations made possible by the Reorganization Act of 
1939 had reached the point of full returns, the gradual transformation from 
peace to war expressed itself in the creation of many new agencies. Coordi- 
nation became a burning issue. The way this issue was met is likely to have 
wider significance. In the first place a considerable degree of coordination 
was achieved through the Executive Office of the President, doubtless the 
outstanding product brought forth under the Reorganization Act of 1939. 13 
One of its divisions, the Office for Emergency Management, furnished the 
nominal link between the chief executive and most though not all of the 
new machinery. In the initial period, it also exerted some real coordinative 
and prompting influence. More important in the whole development was 
the role of another division of the Executive Office, the Bureau of the Budget. 
The latter, established in 1921 as the President's first staff agency, came 
to reflect him in administration, in Arthur Macmahon's appraisal. 14 Sec- 
ondly, as the pressures and frictions within the quickly expanding executive 
branch increased and as action programs acquired red-hot priority, officials 
in charge of such programs were authorized to assume directive powers in 
broad fields, binding upon all operating agencies active in these fields. This 
was true of the heads of the War Production Board and the War Manpower 
Commission. Later, successively wider coordinative mandates were en- 
trusted to the director of the Office of Economic Stabilization (1942) and the 
director of the Office of War Mobilization (1943), afterwards the statutory 
Office of War Mobilization and Reconversion. 



13 A highly informative symposium on the Executive Office of the President in its original 
form by Louis Brownlow and Others was published in Public Administration Review, 1941, 
Vol. 1, p. 101 ff. The reader should bear in mind that subsequently two divisions of the 
Executive Office disappeared. The Office of Government Reports was disbanded as such, and 
the National Resources Planning Board died of legislative antagonism. 

14 "The Future Organizational Pattern of the Executive Branch," American Political Scienct 
Review, 1944, Vol. 38, p. 1182. A helpful review of war developments is offered by Gulick> 
Luther, "War Organization of the Federal Government," ibid., p. 1166 ff. 



192 THE DEPARTMENTAL SYSTEM 

Staff Establishments. To place reliance for interdepartmental coordina- 
tion on officers or offices that serve the chief executive in a staff capacity 
and exercise authority essentially in his name and by his direction is not a 
novel tendency. Provision for such assistance has been a typical concern 
of state and local reorganization for several decades. It was expressed most 
frequendy in the centralization of expenditure control under a budget 
agency attached to the office of the governor, mayor, or city manager. A 
milestone was set in 1917 when Illinois introduced such a budget system 
into its state administration. Municipalities followed the same path. The 
Budget and Accounting Act of 1921 carried the much-publicized prescrip- 
tion into the federal government. By equipping the President with a special 
agency, the Bureau of the Budget, to aid him in shaping up, year after year, 
the annual work plan of the government for consideration and adoption by 
Congress, this act reversed the former trend toward departmental self-deter- 
mination and independence. In constructing the general program of agency 
estimates of appropriations, the Bureau of the Budget could correlate the 
activities undertaken throughout the executive branch, and thus give a 
substantial impetus to interdepartmental coordination as well as to the 
improvement of administrative management. 

With the establishment in 1939 of the President's Executive Office, the 
Bureau of the Budget, as an integral part of the new nucleus, underwent a 
conspicuous expansion in order to become one of the "principal management 
arms of the Government." 15 Through its growing professional staff, it was 
able to furnish practical help at numerous points in the conversion of the 
administrative system from peacetime needs to wartime demands, and in 
spreading knowledge of tested methods and practices. The broad range of 
this kind of combined consulting and installation service supplied the bureau 
with unusual opportunities for spotting undetected weaknesses of organi- 
zation and management in the unfolding war administration. Depending 
on the character of the problems and obstacles which it encountered in its 
remedial efforts, the bureau on many occasions placed issues before the 
President which would ordinarily not have come to his early attention. In 
numerous instances, these issues involved clarification of jurisdictional boun- 
daries and adjustment of programs for better coordination of different 
agencies that somehow had got in one another's way. 

Simultaneously, the bureau kept its eyes on the attainment of dominant 
wartime objectives through concerted action by several federal agencies, 
from the point of view of both adequate administrative planning and syn- 
chronized execution. This entailed working contacts with planning staffs 
and operating officials in various parts of the executive branch, and also the 
combined boards and similar devices by which the United States secured 
cooperation with Great Britain, Canada, and other members of the United 

15 This is the language of Executive Order No. 8248 of September 8, 1939, which may 
be called the original charter of the President's Executive Office. See also above note 13. 



THE DEPARTMENTAL SYSTEM 193 

Nations. 16 Aside from such working contacts, the bureau exercised its 
budgetary authority for coordinative purposes. The same end was furthered 
in connection with the bureau's review for conformity with the President's 
program of agency proposals for legislation or executive orders, and agency 
reports to congressional committees on pending bills. Another avenue of 
coordination presented itself in the bureau's responsibility, under the Reports 
Act of 1942, for approving agency plans for statistical inquiries addressed to 
the public. Additional pertinent authorities were included in the war over- 
time pay legislation and its successor, the Federal Employees Pay Act of 
1945, under which the budget director determines periodically the personnel 
requirements of federal agencies. 

Coordinating Agencies. Compared with the implicit and broadly inclu- 
sive coordinating mandate of the Bureau of the Budget, the wartime inno- 
vations for pulling together governmental activities in order to "hold the 
line" against inflation and to organize all of the productive resources of the 
country for greatest striking power appear as explicit and specific grants of 
authority. The evolving pattern became clear with the formation of the 
Office of Economic Stabilization; it later found its sharpest expression in 
the tasks assigned to the new Office of War Mobilization. The director of 
the Office of War Mobilization was charged with the duty "to unify the 
activities of the federal agencies . . . engaged in or concerned with produc- 
tion, procurement, distribution, or transportation of military or civilian 
supplies, materials, or products." He was also to "resolve or determine 
controversies between such agencies," except those falling into the jurisdic- 
tion of the Office of Economic Stabilization. In exercising these functions, 
he was entitled to "issue such directives on policy or operations to the federal 
agencies ... as may be necessary to carry out the programs developed, the 
policies established, and the decisions made" under his authority, and to 
call for progress reports from any of the agencies subject to his directives. 
In basic conception, the pattern fashioned by executive orders issued in 
1942 and 1943 under the President's wartime powers was reaffirmed in the 
War Mobilization and Reconversion Act of 1944. In this law the renamed 
Office of War Mobilization and Reconversion emerged as a statutory estab' 
lishment," incorporating within itself three equally temporary demobilization 
agencies having kindred supervisory concerns: the Office of Contract Settle- 
ment, the Surplus War Property Administration, and the Retraining and 
Reemployment Administration. 17 

Thus there had arisen, side by side with more traditional coordinating 

m Operation of the combined machinery has been looked upon by many as a rehearsal 
for peacetime international organization; see, for instance, Salter, Arthur, "From Combined War 
Agencies to International Administration," Public Administration Review, 1944, Vol. 4, p. 1 ff. 
The author is an old hand at combined business; his study of Allied shipping control during 
World War I, published in 1921, is still of great value. 

17 The progress of demobilization planning has been traced by Key, V. O., "The Recon- 
version Phase of Demobilization,*' American Political Science Review, 1944, Vol. 38, p. 1137 ff. 



194 THE DEPARTMENTAL SYSTEM 

machinery as exemplified by the Bureau of the Budget, an impressive 
hierarchy of coordinators, with the War Mobilization, and Reconversion 
director closest to the apex. He was not exactly at the apex because he had 
to share the loftly heights with others, primarily representatives of the 
military services, including the Joint Chiefs of Staff, and spokesmen of 
foreign policy, especially the Secretary of State. Although in large part a 
makeshift arrangement, the new hierarchy of wartime coordinators was 
instrumental in settling countless questions which normally would have 
plagued the chief executive without really requiring his consideration. 
Delegation of some of his authority proved to be the answer to the riddle 
of unified administrative operation. 

This sounds quite simple. But the specific character of such delegation 
had to be worked out experimentally. Men had to be found to try their 
hand at tentative assignments, never knowing at the start whether they 
would fit into the personal working habits of an executive head who at the 
very beginning of the defense organization for war needs had proclaimed 
himself emphatically "the boss." And prestige had to be built up for these 
men so that operating officials would actually take orders without thoughts 
of appeal or evasion. All of this called for more than mouth-filling clauses 
written into executive orders. 

Although interdepartmental coordination had gained the upper hand 
over departmental friction during the closing years of World War II, it 
did not exactly leave us an accepted prototype for peacetime use. In the 
first place, the somewhat haphazard stratification of coordinative layers 
wedged between the chief executive and the departmental system in its 
wartime enlargement in itself resulted in a good deal of uncertainty. A 
simpler postwar setup appears highly desirable, with fewer layers and 
still greater precision in responsibilities. Second, the hierarchy of coordi- 
nators with their own special staffs seemed to pose a contradiction to the 
fundamental idea embodied in the Executive Office of the President. 

Each coordinator reflected an element of power derived directly from 
the basic function of the chief executive as the constitutional overseer of the 
departmental scheme. To differentiate between the "arms of management" 
supplied in the Executive Office and special arms of coordination might be 
a strenuous exercise in semantics. Some of the special arms of coordination, 
it is true, were nominally part of the Executive Office, through the fiction 
of an integrated Office for Emergency Management; this applied, for in- 
stance, to the chairmen of the War Production Board and the War Man- 
power Commission. However, in both fact and physical location, these first- 
line coordinators were none too close to the White House. Closest to it, and 
actually in it most of the time, was the head of the Office of War Mobiliza- 
tion and Reconversion; but he, interestingly, was never organizationally 
included in the Executive Office. The institutional gap between him and the 
Bureau of the Budget would probably have caused difficulties save for 



THE DEPARTMENTAL SYSTEM 195 

generally satisfactory working relationships, insisted upon by President 
Roosevelt himself. 

A third factor is perhaps still more important. Under the War Mobiliza- 
tion and Reconversion Act of 1944, the top coordinator of the home front 
assumed a statutory office under specifications that tended to pull him 
toward congressional rather than presidential superintendence. To that ex- 
tent the law impinged visibly on "the orthodox administrative doctrine that 
organs of direction should occupy a staff relation to the chief executive." 18 
Here, again, we perceive possibilities of dissonances. 

A statutory "Assistant President," gravitating toward Congress because 
of special reporting obligations, may severely limit the President's directive 
power. His presence also may cause strain in the President's use of the "arms 
of management" provided in the Executive Office. Or, if there is instead of 
an "Assistant President" the head of a superdepartment in charge of pro- 
gram formulation and program coordination over wider areas of the 
departmental system, might not such statutory relationship with the legis- 
lature narrow unduly the President's control over the line-up of operating 
agencies? Coordination above the departmental level is part and parcel 
of the President's executive function. Such coordination can only be 
achieved by his direction, based on the same principle on which rests the 
exercise of authority by his "arms of management." It appears to follow 
that for best results coordinative assistance should be rendered to the Presi- 
dent within the framework of his appropriately regrouped Executive Office. 
Managerial coordination by the Bureau of the Budget and directive co- 
ordination by a special officer cannot be separated organizationally. 

Role of the Cabinet. Nothing has been said thus far about the Cabinet 
as a coordinating mechanism, and for good reasons. It is customary to point 
out that in contrast with Great Britain the American assembly of depart- 
ment heads as a consultative body is devoid of constitutional standing, in 
the states as well as in the federal government. Nor is the matter different 
in our municipalities. Where governor's or mayor's councils exist, they are 
generally special advisory establishments for particular purposes. Whereas 
the British War Cabinet, in both World War I and World War II, served 
as one of the foremost devices for tightening up the departmental system, 
in the United States the accelerated pace of critical times seems to bring 
about almost the opposite result. Woodrow Wilson did find it convenient 
to meet regularly with the key figures of his war administration, but work- 
ing relations among various agencies rarely dominated the agenda. Franklin 
D. Roosevelt took no inspiration from Wilson's example and managed to 
keep the circle of his close advisers for the most part in fairly constant 
motion. The parallel with the "brain trust" of the thirties suggests itself, 
including the rate of turnover. In this picture the Cabinet's contribution was 

18 Key, he. cit. in note 17, p. 1152. 



196 THE DEPARTMENTAL SYSTEM 

reduced to the fact that it continued to meet without ever becoming a 
central cog. 

One explanation of the difference between British and American prac- 
tice in this respect is usually left unmentioned. In England, the Cabinet 
puts heavy responsibility for the effective conduct of its business on a com- 
petently staffed secretariat. This secretariat, in its developed form the 
institutional offspring of World War I, sees to it that all matters on the 
docket, except last-minute propositions of great urgency, are checked and 
cleared to the point where the issue can be disposed of by a decision offer- 
ing promise of finality. With us, notwithstanding the existence of the 
Executive Office, comparable facilities for continuous cross-referencing 
are still lacking. Small wonder that Cabinet meetings tend to revolve 
around summaries of developments presented by the President himself, 
and items of departmental concern brought up by individual secretaries but 
rarely of true interest to the Cabinet as a whole. Although sound sugges- 
tions have occasionally been advanced for a vitalization of the Cabinet, 10 
decisive change is hardly in the offing as long as we do not build up an 
adequate secretariat. 

Use of Interdepartmental Committees. Before we leave the subject of 
interdepartmental coordination, a word on the use of special committees 
is in order. Such committees combining representatives of several agencies 
for joint deliberation of matters of common interest or wider ramification 
are nothing new. We find illustrations on all three levels of government 
federal, state, and local. Shortly after its inception, the Bureau of the 
Budget began to surround itself with a growing array of interdepartmental 
committees which, under varying names, attended to the inauguration of 
better management. Collectively, they came to be known as the Coordinat- 
ing Service, steered by a chief coordinator who in turn reported to the 
director of the bureau. The Coordinating Service was supported by a 
regional organization of its own, which linked itself to the more than three 
hundred federal business associations composed of ranking federal field 
officials in as many cities throughout the land. In the early twenties, these 
interdepartmental arrangements gave considerable drive to the improvement 
of governmental business practices. But in the course of time the effort 
spent itself, and the Coordinating Service died of stagnation. It was form- 
ally abolished in 1933. Atrophy had also weakened the remaining federal 
business associations. 

Many other interdepartmental committees, however, continued to pursue 
their missions in the executive branch. One notable example was the Cen- 
tral Statistical Board, later transferred to the President's Executive Office 
and perpetuated as the Division of Statistical Standards in the Bureau of 
the Budget. Throughout the lifetime of this board, coordinating functions 

19 See, for instance, Macmahon, loc. cit. in note 14, p. 1187. See also above Ch. 8, "The 
Chief Executive," sec. 5, "Arms of Management" 



THE DEPARTMENTAL SYSTEM 197 

were in the foreground of its program. The same can be said of the Com- 
mittee on Trade Agreements brought together under auspices of the State 
Department. A more recent instance was the creation in the State Depart- 
ment of an Executive Committee for Economic Foreign Policy, which may 
prove itself a very important interdepartmental arrangement. 20 

With all that, we are far from possessing on any of the three levels of 
government a comprehensively interlocking committee system. Nor should 
we expect too much from it if we had one. For, in the nature of things, 
interdepartmental committees seldom feel the directive push from above. 
They function on condition of agreement, and may deteriorate into trading 
posts where stubborn parties bicker for their own advantages. Apparently, 
such committees work best on the basis of specific terms of reference, with 
a membership picked for sufficient authority or technical knowledge to 
facilitate mutual commitment, and under alert and vigorous leadership. 
When these conditions prevail, interdepartmental committees may repay 
many times the administrative effort invested in them. 

Avenues of Progress. In the perspective of interdepartmental coordi- 
nation, the departmental system shows itself as a massive conglomeration 
which does not readily respond to the reins held by the chief executive. Ad- 
ministrative agencies are apt to become personifications of a purpose en- 
dowed by legislative action and guarded by interest assortments that regard 
themselves as the lawful beneficiaries of the endowment. The result is 
reluctance toward whole-hearted acceptance of executive control. Centrifugal 
tendencies are therefore innate in the departmental structure. A concert 
of forces is attainable only through continuous assertion of direction from 
the top. 

Realistically speaking, this means that coordinative effort plays the 
role of a counterpressure. It is never supreme, but it may go far toward 
accomplishing a relatively high degree of homogeneity of general orienta- 
tion. Organization charts of the executive branch tend to display reas- 
suringly straight lines of command and responsibility. In certain ways, 
however, a more appropriate comparison might be that with a feudal 
pattern of higher and lower fiefs in which the vassals are sometimes torn 
between conflicting loyalties, and where designation of rank is often a very 
misleading index of actual power and influence. 

Looking ahead with our eyes on the national goal of high-level employ- 
ment, we can discern some of the problems that closely bear upon the 



20 For an informative appraisal of federal experience in this field, see Reynolds, Mary T., 
Interdepartmental Committees in the National Administration, New York: Columbia University 
Press, 1939. The role of interdepartmental machinery within the State Department is indicated 
in Laves, Walter H. C. and Wilcox, Francis O., "Organizing the Government for Participation 
in World Affairs," American Political Science Review, 1944, Vol. 38, p. 913 ff. Sec also two 
related papers by the same authors under the tides "The Reorganization of the Department of 
State," ibid., p. 289 ff., and "The State Department Continues Its Reorganization," ibid., 1945, 
Vol. 39, p. 309 ff. 



198 THE DEPARTMENTAL SYSTEM 

general organization of the executive branch. When integrated economic 
policy and coordinated application of regulatory and stimulative mechan- 
isms are at a premium, we must aim at three cardinal things. First, while 
adding to the strength of top coordination in planning as well as in execu- 
tion, we must decrease the exorbitant strain on the chief executive by 
providing supplementary opportunities for synthesis through broader re- 
grouping of departmental spheres or stronger machinery for interdepart- 
mental cooperation. This need is particularly acute in such fields as 
provision for unified national defense, conduct of postwar foreign affairs, 
maintenance of industrial peace, and integration of authority over trans- 
portation, including aviation. Second, as soon as we think of the impli- 
cations of departmental regrouping to further these ends, the question of 
the independent regulatory boards and commissions comes to mind. 
Independence from the chief executive in combination with segmentation 
of regulatory assignments between a variety of such agencies spells serious 
inadequacy. The postwar need for dealing with the economy in terms of 
widely inclusive consistency does not accord with multiplicity of inde- 
pendent regulatory bodies. Much of this is also pertinent to the future 
role of governmental corporations. And third, sound staff work within 
a more comprehensive Executive Office of the President, with full partici- 
pation of agency staffs, will be an indispensable requirement. Invigoration of 
the staff function cannot be long delayed lest government itself be chal- 
lenged in its role of protecting the enterprise economy against fateful shocks. 

3, THE SECRETARY'S BUSINESS 

In federal administration, the title of secretary is confined to the heads 
of eight of the ten executive departments; the remaining two department 
heads are designated as Attorney General and as Postmaster General. 
However, in this discussion of the secretary's business we shall apply the 
term generically. That is to say, we shall deal with the tasks of the gov- 
ernmental executive on the agency level, whatever the name of the agency. 
Names differ widely today. Aside from the regular departments federal, 
state and local we find agencies labeled as offices (such as the Office of 
Price Administration), administrations (such as the Veterans Administra- 
tion), authorities (such as the Tennessee Valley Authority), and so on. 
Quite a few of these are permanent establishments; many others are of an 
emergency character. However they may differ in durability, most of them 
are generically very much like the regular departments. Their heads face 
about the same working conditions and tribulations. 

External Affairs. Like the chief executive himself, the governmental 
executive on the agency level must cope with two main categories of busi- 
ness: external matters and internal matters. Both categories compete for 
his attention. He cannot safely neglect the one for the other. In this re- 
spect, again, the governmental executive finds himself in a position not 



THE DEPARTMENTAL SYSTEM 199 

basically different from that occupied by the executive in private enterprise. 
It is sometimes suggested that the governmental executive, being a public 
figure distinctly visible to the public, is more heavily burdened with ex- 
ternal matters. However, private management has recently become very 
much aware of the necessity for dividing its energy to satisfy the general 
public as well as its customers, stockholders, and employees. 

An angry general public can stir up a lot of trouble even for the biggest 
corporations. Thus it is sound protection of investment for private man- 
agement to put its best foot forward in its relations with the general public. 
Ever since the late Ivy Lee made himself the father of a new profession 
by "humanizing" the Pennsylvania Railroad and the senior Rockefeller, 
the art of public relations has enjoyed top rating among the external con- 
cerns of business executives. The emergence of such figures as Archibald 
MacLeish, a ranking man of letters, and William Benton, a publicity 
specialist, as Assistant Secretaries of State in charge of informational services 
is symptomatic of the same development in public administration. 

Roughly speaking, the weight of the executive function in the technical 
sense rests in the internal realm, in the direction of an administrative or- 
ganization toward accomplishment of its purposes. By comparison, ex- 
ternal business gives the impression of being auxiliary to the executive 
function, providing for the surrounding conditions under which this func- 
tion and the total task of the organization can best be carried out. Such 
a distinction, however, should not lead us to assume that we may draw a 
precise borderline between external and internal aspects. Quite apart from 
questions of administrative policy where public repercussions are often a 
crucial factor, even seemingly innocent details of management have an 
alarming capacity for catching unexpected attention outside the agency's 
four walls. Most problems which come before the governmental execu- 
tive carry with them potentialities of public debate, and require at least 
a second thought from this angle. 

Living in a Goldfish Bowl. Fortunately, the large majority of items 
passing across the desk of the governmental executive fail to attract outside 
notice. But he can never be sure in advance. Newsmen have their peculiar 
pipelines. Congressmen fish up a great many interesting things about regu- 
lations, instructions, and orders which agency field officials bring to bear 
upon constituents "back home." Grilling may be merciless when the time 
comes around for legislative committee hearings on the agency's budgetary 
estimates, to say nothing about investigating committees. 

Of course, public wakefulness is not only necessary in a democracy but 
also a most desirable stimulant. Yet the governmental executive frequently 
has a tough time trying to do anything without offending some organized 
group or running up against the highly personal views of a powerful fig- 
ure in the legislature. On the legitimate doctrine that public business is 
everybody's business, we are as a nation predisposed toward criticizing pub- 



200 THE DEPARTMENTAL SYSTEM 

lie officials more liberally and spontaneously than we do executives in 
private enterprise. That in itself has done much to retard the demise of the 
myth that business management is more efficient than government, and to 
keep alive the dangerous notion that the price of democracy is inefficiency. 

Because of the pressure of external matters, the governmental executive 
must be something of a politician, at least in an extracurricular way. If 
he was recruited from the arena of politics, he may not find it difficult 
to retain his former alignments and friends. These are valuable sources of 
counsel on matters of agency strategy and tactics. They can be instrumental 
in promoting the public reputation of the governmental executive as a 
"crack administrator," even if his management staffs will never cease to 
shake their heads in privacy. Friends good and true, in the legislature and 
in interest organizations, are also able to carry the ball for him when the 
game becomes fast. A different situation usually presents itself to the gov- 
ernmental executive whose rise to office stems from eligibility acquired 
outside politics in the customary meaning. He needs the same kind of 
external support, but he seldom gets it without extensive effort. He may 
also learn that it is not a simple thing to be a politician in an extracurricular 
fashion without making it a curriculum. 

Whatever the background of the governmental executive, he cannot for 
any length of time relax his vigilance over his agency's public relations. 
This requires special internal organization, technical assistance within his 
own office, and much hard labor on his part in mingling socially with the 
right crowd, in building good will at his press conferences, and in cultivating 
his legislative contacts. Nor should we forget his equally exacting chore of 
maintaining himself close to the chief executive and those who have his 
ear officials or members of the "kitchen cabinet," which may also include 
elements of the distaff side. 

Finally, there are his colleagues at the helm of various other agencies. 
Some of them may have sharply competitive instincts. Others may demon- 
strate personal antagonism. But rare is the agency which can live by itself, 
without dependence on sympathetic cooperation from other agencies. It 
would be very bold to presuppose the existence of whole-hearted cooper- 
ation among all members of the executive family. In the development of 
cooperation, the way in which the governmental executive personally gets 
along with his brethren is a matter of great importance. One of his most 
obvious tasks as the responsible head of his organization is to exert himself 
continually toward driving into every part of it a thorough appreciation 
of the need, not only for good public relations, but also for effective work- 
ing relationships with other elements of the executive branch. 

Character of Executive Function. Turning to the executive function itself, 
we may describe its core in brevity as direction and control the former in the 
sense of providing for the right kind of action, and the latter looking toward 
ttie attainment of accountability for and in the execution of policy. These 



THE DEPARTMENTAL SYSTEM 201 

two central terms embrace a variety of integral and interrelated functions. 
Direction entails planning, coordination, and programming even research. 
Control involves organization, supervision, documentation, and reporting. 
Other subsidiary functions play in equal proportions in both spheres. 
Budgeting, for instance, is simultaneously a tool of planning and a method 
of accountability. Personnel administration also serves both direction and 
control. 

While there are different ways of grouping the ingredients of the execu- 
tive function, no grouping can dispose of the plain fact that the governmental 
executive himself operates in a relatively small circle concentric with that 
of the total executive function. In other words, in exercising the executive 
function he is at the pole from which his actions radiate into his agency. 
However, in shaping his actions and in securing compliance throughout the 
agency he must necessarily rely on many aides who thus act as extensions 
of the executive function. Because human beings are anything but robots, 
these aides perform their tasks not as inanimate cogs but as individuals 
who exert measurable influences upon one another, and also upon the gov- 
ernmental executive himself. This makes the latter a more resourceful and 
better informed chief. But it is at the same time a control and a limitation 
placed upon him. 

Classes of Executive Aides. The aides who share in the exercise of the 
executive function fall into fairly distinct classes. They may be divided 
broadly into political and professional officers. Typically, undersecretaries, 
assistant secretaries and special assistants are political appointees, though 
their claim to recognition is based in an increasing number of cases on 
evidence of special competence rather than on obligations of patronage. 
One or the other may even have come from the ranks of the department. 
The professional element is mostly supplied through career service. In 
federal administration, the majority of bureau chiefs or heads of special 
services like budgeting have reached their level from below; this would 
not be true of many state and local governments. 

Most of the federal bureaus are in charge of defined departmental ac- 
tivities of a line character. But you can never trust official nomenclature. 
Outstanding examples of bureaus serving in a staff capacity are the Bureau 
of Agricultural Economics in the Department of Agriculture and the 
Bureau of Labor Statistics in the Labor Department. Many other staff 
units are known as offices, divisions, or branches. Such staff and auxiliary 
facilities planning, management, budget, statistics, personnel add to the 
infusion of professional thinking into the institutional environment in which 
the agency head spends his days. 

Attaining an Institutional Product. The governmental executive thus 
enjoys the advantage of having at his call not only various types of advisers 
but also a profitable blend of judgments political and professional, staff 
and line, general and special. If he is alert in securing the proper mixture 



202 THE DEPARTMENTAL SYSTEM 

for each different occasion, he will rarely make a fool of himself. However, 
the proper mixture cannot be found in any book of recipes. The crux of 
the executive function lies therefore in the teamplaj of all the aides who 
enter into the exercise of direction and control. 

In an agency that has settled down to its business and has become a 
going concern, teamplay will arise without requiring constant prodding 
from the head of the agency. Notwithstanding personal incompatibilities 
of one kind or another, the individual members of the team will come to 
adjust themselves to a pattern familiar to all. Each will learn the modes of 
thought of the others, including their idiosyncrasies and their blow-up 
points. As this process continues, the governmental executive will be able 
increasingly to restrict himself to feeding fresh ideas into the team and to 
getting conclusions into concrete form for practical application. It is in this 
sense that some students of management have spoken of the executive as 
the catalyst or as the ratifier of staff judgment. This is quite different from 
the nai've conception of the titan who roars orders. 

Departmental leadership, then, calls for much more than a chief who 
thinks of himself as a ruler and "gets things going." He cannot whip sub- 
ordinates into doing well. He cannot overrule them blindly. He has no 
way of preventing his orders from being bent and twisted at will in the 
process of execution by operating officials who say they "didn't understand 
them." The governmental executive in widening the horizon of his or- 
ganization, in holding it to its main goals, in welding its resources together, 
in straightening out internal and external difficulties shows himself a true 
leader by being ever mindful of the human factor. 21 The more he suc- 
ceeds in persuading, the less will he be driven to empty gestures of authority. 
In the long run, his accomplishments will not stand up if they fail to live 
in the minds and attitudes of his subordinates. This means that he may 
have to accept, at least temporarily, the veto of his key officials. Nor can 
he push ahead in too many directions at once. He must have considerable 
patience in making his influence felt. Only thus can he educate his or- 
ganization to think and act on his terms. Only thus can he give real force 
to his leadership. 

4. THE BUREAU PATTERN 

Special Concerns Versus General Purposes. Exercise of the executive 
function employs many more individuals than the agency head himself. 
Despite such relief as may be achieved through distribution of responsibili- 
ties among officials sharing in the application of directive power or im- 
plementing the directive power by staff work, the governmental executive 

21 For a more extensive discussion of the working approach of agency heads, see Stone, 
Donald C., "Notes on the Governmental Executive: His Role and His Methods," Public 
Administration Review, 1945, Vol. 5, p. 210 ff.; Appleby, Paul H., Big Democracy, ch. 7, 
"Operating on One's Proper Level," New York: Knopf, 1945. 



THE DEPARTMENTAL SYSTEM 203 

is still heavily burdened. He alone is able to attend to the necessary con- 
tacts with the chief executive, legislative leaders, and his colleagues in the 
departmental system. He alone is in a position to reconcile in binding 
terms political answerability for the actions of his agency with vigorous 
pursuit of agency programs. He alone can shoulder the task of keeping 
fresh in all minds a unified conception of purpose and approach. 

Faced with these prime duties, he would invite failure and defeat if he 
allowed his energies to be dissipated in details and trivialities. Of course, 
small things are often more important than they seem to be at first glance, 
especially if they have a political twist. In trying to shun small things, the 
governmental executive therefore cannot afford to dispose of sage discrimi- 
nation. He must develop an eye for the significant detail. Yet he should 
normally stick to his proper level. If he does not, he is likely not only 
to give inadequate time to his main role but also to befuddle his supporting 
cast and throw working relationships on lower levels out of gear. 

In confining himself generally to his own level, the governmental execu- 
tive would have little ease of mind if he could not be reasonably sure of 
the caliber, loyalty, and thought processes of his key subordinates. This 
again underscores one of his principal obligations that of establishing close 
rapport with the subleadership of his organization so that his attitude can 
become active on a broad scale. Subordinates can directly handle many 
issues when they know of his general attitude. They can evolve a pretty 
dependable sense of differentiation in determining what matters should go 
up to him and what matters they can settle in their spheres. 

It is difficult to spell out such differentiation in writing, but in the work- 
ing style of a well-directed agency the differentiation is usually quite pre- 
cise to all concerned. Equally important is the willingness of the govern 
mental executive to make the most of his associates by handing them things 
that are too tough for him to accomplish without assistance. He is the con- 
ductor in the concert of specialists; as such he needs only his score, a baton, 
and the eyes of his orchestra. When technicalities come up, he should 
promptly turn them over to his technicians. When operational questions 
arise, he should first put them up to his operators. In either case, he has 
to be familiar with the structure of his resources. 

Centrifugal Pull. Most of the staff and auxiliary services aiding the 
governmental executive are appendages to his own office, though the organi- 
zation chart will show them as separate boxes. But the operating branches, 
traditionally organized as bureaus or their equivalent, are one further step 
removed. Each in its divisions, sections, units, and field establishments 
may control many hundreds and even thousands of employees. And the 
number of such bureaus within one agency may run to a score. The 
sheer bulk of these operating branches absorbed in their particular business 
means for the agency's center the secretary's level an enormous centrifu- 
gal pull, a constant "downward drag." As one able former undersecretary 



204 THE DEPARTMENTAL SYSTEM 

has remarked, "throughout my stay in Washington I have been impressed 
with the fact of too great separation on the part of the bureaus from 
the departments." 22 

This separation is not simply overcome by placing groups of bureaus in 
charge of assistant secretaries or coordinating directors. However, we can 
see the obvious need for "some collateral or parallel lines of control to push 
against the whole vertical structures of the bureaus in moving the bureaus 
into closer association and harmony." In addition, "immediately around the 
secretary there must be a special means for converting matters that come 
from the special bureau pyramids into the general." 23 During World War 
II as well as earlier, the Department of Agriculture experimented with ar- 
rangements of this kind, if only in a tentative fashion. Such arrangements, 
however, do not yield results automatically. They are stepping stones that 
lead to varying degrees of functional integration when and insofar as the 
departmental officialdom can be induced to use them as the customary and 
the safest thing to do. 

Bureau Intransigence. As departments are prone to struggle for their 
operational prerogatives and find inconspicuous ways of defying or evading 
central control, so bureaus within departments prefer to be "left alone" by 
the departmental high command. Some of this tendency is everpresent. It 
is frequently reenforced by bureau self-sufficiency, both in squarely sitting 
on a special function and in holding hands with a specific clientele. The 
result may be a high degree of institutional intransigence paired with sub- 
servience to interest demands coming from the outside. The one is as em- 
barrassing to the governmental executive as the other. 

Here, as in the area of the chief executive, we can notice distinctly the 
unintended consequences of the historic growth of our administrative organ- 
ization. The body administrative first developed its extremities, then its 
head. In their relative proportions, hands and feet the operating extremi- 
ties are oversized and the control center of the nervous system is still too 
weak. To change the metaphor, the relationship between the bureaus and 
the secretary's setup resembles, more often than it should, the proverbial 
tail wagging the dog. 

Weight of Professionalization on Bureau Level. The genesis of our 
administrative system is also reflected in a related fact. Not only are the 
staff facilities available to the governmental executive younger and weaker 
than most of the operating bureaus; they are also less representative of the 
career element! 24 Thus general management and control, in terms of the 

22 Appleby, Paul H., in an interesting exchange of letters with Professor Arnold Brecht 
published in Public Administration Review, 1942, Vol. 2, p. 63. 

23 fad., p. 66. 

24 A most valuable source of information on this and related subjects is Macmahon, Arthur 
W. and Millett, John D., federal Administrators, New York: Columbia University Press, 1939. 
See also the first author's earlier studies of selection and tenure of federal bureau chiefs pub- 
lished in American Political Science Review, 1926, Vol. 20, p. 548 ff. t 770 if. 



THE DEPARTMENTAL SYSTEM 205 

entire department, have to contend with a greater measure of professionali- 
zation on the lower levels. The answer, of course, is fuller recognition of 
the career idea near the apex of the administrative hierarchy, including a 
differentiation between political and permanent members of the secretary's 
entourage. 

It is interesting that the central departments in Germany, where the 
career principle for the higher service emerged more than two centuries ago, 
have traditionally operated as very small establishments, with the operating 
branches organized as autonomous though subordinate entities. The depart- 
ment head exercised his authority primarily through, or with the constant 
counsel of, his permanent undersecretary. The permanent undersecretary 
in turn relied on the directors of some three to five divisions, each of which 
was composed of less than a dozen officers, not counting clerical personnel. 
These officers principals, as their counterpart is called in British minis- 
terial parlance looked after their special fields, in which each was "ex- 
pected to be the foremost expert of the country, at least so far as it relates to 
government." 25 The principals were the links between the department and 
its autonomous though subordinate bureaus headed by presidents. The 
individual principal kept the bureaus under his jurisdiction in touch with 
departmental policy and conversely received all necessary information from 
them. This may appear to us as a still more marked separation of the bu- 
reaus from the departments. Actually, conversion of business from the 
special bureau context to the general departmental context was more easily 
attained through a small but high-powered top organization composed of 
career men. 

Reaffirming Unity of Purpose. However, although his bureaus may 
have assertive individualities of their own, it should not be inferred that the 
governmental executive is helpless in the face of subtle obstinacy. His staff 
and auxiliary services, if alive to their opportunities, are capable of acting 
for him at many points of the departmental organization in the combined 
roles of mediators, missionaries, and watchdogs. The departmental budget 
officer, for example, can be extremely useful in keeping operating bureaus 
in line by screening their requests for appropriations with a view to con- 
formity with the general program of the agency head. Nor need the pres- 
sure for synthesis come exclusively from the top. Interbureau committees 
may be utilized to provide gentle compulsion for the operating services to 
take account of a broader conception than that of their own cherished 

25 Brecht, Arnold and Glascr, Comstock, The Art and Technique of Administration in 
German Ministries, p. 25, Cambridge: Harvard University Press, 1940. Professor Brecht, a 
former ministerial director in the German career service, has argued the case for arrangements 
described in the text in a number of thoughtful statements, most extensively in his article on 
"Smaller Departments," Public Administration Review, 1941, Vol. 1, p. 363 ff., and in some 
subsequent correspondence with Mr. Appleby, then undersecretary in the Department of Agri- 
culture, he. cit. above in note 22, p. 61 ff. It is pertinent to observe that federal departments 
have as a rule met suspicion on the part of the Appropriations Committees of Congress when 
proposing reinforcement of the immediate organization at the disposal of the department head. 



206 THE DEPARTMENTAL SYSTEM 

microcosm. 26 Consultative methods, systematically applied, can contribute 
substantially to the formation of what may justly be called the depart- 
mental mind. Regular staff conferences, bringing together responsible offi- 
cials on various levels of the departmental pyramid, offer another device 
that has yielded tangible benefits where it has found thoughtful sponsorship 
and intelligent support. 

To be sure, forms of administrative structure and management, though 
experience may favor one over another, are never better than the living sub- 
stance for which they are to serve as receptacles. This living substance is 
made up of men and women who at best represent humanity in all of its 
embodiments. That they have passed entrance examinations is perhaps the 
least significant thing about them. Much more important, beyond their 
quest of decent living, is their pride of service and the nature of their adjust- 
ment to the discipline of working together for an end above personal gain. 
In both their pride and their adjustment, they are subject to influences 
good and bad that spring from the dynamics of our political order. Depart- 
mental leadership is only one of these influences, but its effects should not 
be underestimated. The more we succeed through proper staffing in making 
departmental leadership an institutional product, the less need we fear the 
bungling or bullying of uninspired mediocrity. 

2<J For the experience of the Department of Agriculture, which, has extensively relied on 
this medium, see Glaser, Comstock, "Managing Committee Work in a Large Organization," 
Public Administration Review, 1941, Vol. 1, p. 249 ff. See also in general Morstein Marx, Fritz, 
"Bureaucracy and Consultation," Review of Politics, 1939, Vol. 1, p. 84 ff., and "Policy Formu- 
lation and the Administrative Process," American Political Science Review, 1939, Vol. 33, p. 



CHAPTER 



Independent Regulatory Establishments 

The administrative structure of government is often pictured as a neatly 
symmetrical pyramid in which each stone is a unit of the executive branch 
and the capstone is the chief executive. Tidy instincts make us expect that 
no stray stones will be scattered about on the ground surrounding the pyra- 
mid. In practice, government is not organized that way, and there is a 
considerable body of opinion that it should not be so organized. We need 
only glance at any government in this country or abroad to see that while 
many public agencies are subject to immediate control by the chief execu- 
tive, there are a number of agencies having some degree of independence 
from him and even, in certain cases, from the legislature. It is these so- 
called independent establishments that will receive particular attention in 
the present chapter. 

1. TYPES OF INDEPENDENT ESTABLISHMENTS 

Meaning of Independence. "Independence," as a word, has acquired a 
confusing variety of meanings in the governmental setting. Usually the 
word refers to freedom of an agency from immediate control by the chief 
executive and, in some cases, by the legislature. In certain uses, however, 
"independence" in government refers to integrity and devotion to the public 
interest & natural derivative from the first meaning if legislatures and chief 
executives are thought of as "political" in the opprobrious sense of that term. 
By natural progression, this emphasis on integrity and the public interest as 
the very substance of independence leads to giving "independence" the 
meaning of freedom from control by special interest groups. Sometimes 
even, by independence is meant an agency's freedom to act without fear 
of highly restrictive legal barriers erected by courts of law. Finally, those who 
use independence in the sense of freedom from executive and legislative con- 
trol may wind up, through a different chain of reasoning, with an "inde- 
pendence" that means direct responsibility to the electorate. 

These confusions of meaning are not so great as to create insuperable 

207 



208 INDEPENDENT REGULATORY ESTABLISHMENTS 

obstacles to consideration of the status of so-called independent establish- 
ments. Actually, they arise simply from applying the same term to two 
things. The first is the end sought the formulation and administration of 
public policies without undue pressure from political and economic inter- 
ests. The second is the supposed means to that end the organizational 
status of "independence" or isolation from political and economic centers 
of power. 

There are five main types of agencies for which independent status is 
often urged and obtained. First are the regulatory agencies, charged with 
exercising broad governmental powers in connection with electric power, 
transportation, insurance, banking, liquor control, securities issuance, fair 
trade practices, labor relations, radio, and other important economic areas. 
The second type is the government-in-business enterprise, usually organized 
as the government corporation, to which the next chapter is specifically 
addressed. Third are certain service agencies. Some of these, like educa- 
tional institutions and welfare departments, may claim the right to inde- 
pendence largely because of the professionalization of their staffs. Others, 
like highway commissions and to some extent social agencies, claim 
independence because of the possibility of the governor's making political 
capital of their large staffs and expenditures. The fourth group consists at 
the state level of such officials as the state treasurer, secretary of state, and 
attorney general, who largely for traditional and political reasons may be 
directly responsible to the electorate. Finally, there are the auditors who, 
because they are expected to report independently on the legality of expendi- 
tures by executive officials, are wisely made independent of control by the 
chief executive. 1 

Surprisingly, it is genuinely difficult to determine when an agency is 
independent. In fact, both complete independence from, and complete 
subordination to, the chief executive and the legislature are myths. All 
governmental institutions draw too much from the same wellspring of ideas 
and are too exposed to the same "climate of opinion" to be thought of as 
truly independent for long. Independent establishments, like courts, follow 
the election returns, though sometimes with considerable reluctance and 
delay. On the other hand, it is a familiar feature of bureaucracy that even 
in the more highly integrated executive branch, individual departments, 
bureaus, and sections can muster a considerable resistance to direction by 
superior authority; this can be remedied only by firm and decisive action 
by the higher executives. We are, therefore, dealing with a matter of 
degree greater or lesser of independence, not with complete independ- 
ence or complete dependence. 

1 In the federal government the term "independent establishments" frequently refers to 
all agencies neither in the legislative nor the judicial branch that are outside the ten so-called 
executive departments. Such agencies, including, for instance, the National Archives and the 
Smithsonian Institution, have very little in common except this one negative characteristic, and 
are not as a group the subject of this chapter. 



INDEPENDENT REGULATORY ESTABLISHMENTS 209 

Institutional Safeguards of Independence. Ingenious designers have by 
now developed most of the institutional arrangements that promise to in- 
crease an agency's degree of independence. The most common device is that 
of the commission or board form of organization. It is supposed that a 
group of three, five, or seven men is less susceptible of subservience to the 
chief executive than a single department head. If decisions must be made 
by such a multiple-member commission, there is likely to be emphasis upon 
discussion, deliberation, consideration of all relevant opinions, and com- 
promise. The very delay involved in calling a formal meeting of the com- 
mission before a decision is made is an influence against precipitate com- 
pliance with the chief executive's orders. 

Conceivably, of course, even a commission could be made subservient if 
its members were party loyalists all allied with the chief executive, or if 
they were beholden to him for their tenure and could be removed at any 
time he thought appropriate. In fact, some commissions and boards are cre- 
ated as agents of the chief executive, with no thought that they will be or 
should be independent. Advocates of independence must therefore go be- 
yond mere creation of commissions. 

Many commissions must be bipartisan; that is, each must be composed of 
members of both major political parties and in approximately equal num- 
bers. However, political scientists are agreed that the requirement of bipar- 
tisanship puts a premium on extensive political activity as a qualification 
for membership, and therefore fails to lift commissions out of politics into 
an atmosphere of true independence. 2 Furthermore, with each major party 
at present such a congeries of discordant factions, a bipartisanship require- 
ment alone cannot prevent a shrewd chief executive from picking a majority 
of members who share his views on public policy in the area of the com- 
mission's responsibility. While party labels still mean different orientations 
as to public policy when applied to each party as a whole, such labels may 
be quite meaningless when attached to individuals. 

Another supposed assurance of independence is the staggered-term 
arrangement. Terms of members of each commission are scheduled on an 
overlapping basis so that no individual chief executive during his term of 
office has an opportunity to appoint a majority of members of any commis- 
sion. Thus it is assured that no commission will be subservient to him. 
This safeguard breaks down if the same chief executive is elected for 
more than one term or if the same political party or faction captures 
the post of chief executive for several terms in succession. Furthermore, 
it is to be noted that not only newly appointed commissioners but also hold- 

2 One distinguished public servant, Joseph B. Eastman, nearly missed appointment to the 
Interstate Commerce Commission because he was an independent in politics and hence could 
not qualify clearly as a member of either political party. For convenience, he was classified as 
a Republican since there was no Democratic vacancy. See Swisher, Carl B., "Joseph B East- 
man Public Servant," Public Administration Review, 1945, Vol. 5, p. 37 ft. 



210 INDEPENDENT REGULATORY ESTABLISHMENTS 

overs whose terms will expire during the chief executive's term are likely 
to be hospitable to his views on policy. 

Appointment and Removal of Members. Statutory or constitutional 
restriction on the exercise of the executive's appointive power in connection 
with commissions is another device resorted to in the name of independence. 
Many such restrictions are scarcely worth notice, for they are almost mean- 
ingless statutory insistence that an appointee be of good moral character, 
or have professional or business experience, or be free of a criminal record! 
A requirement of senatorial confirmation of appointments is difficult to 
appraise. Possibly it deters the chief executive from making outrageous 
appointments, though public opinion alone should suffice as a check. On 
the other hand, a requirement of senatorial confirmation may actually 
inject so much politics into appointments as to discourage able citizens from 
allowing themselves to be put forward as candidates for public positions. 
Sometimes the chief executive's freedom of choice is considerably restricted 
by the requirement that he select appointees from a limited panel of names 
prepared by some presumably nonpolitical group. Thus, neutral citizens 
for example, presidents of the principal universities in the state may be 
authorized by law to nominate to the governor candidates from whom he 
shall select members of an important regulatory commission. 

In other instances, the legislature may actually force the governor to 
select all commission members from a panel of names submitted by a single 
special-interest group. This, of course, reflects considerable distrust of the 
governor and relatively greater confidence in the interest group's sympa- 
thetic regard for the public interest. Often such a provision betokens abdi- 
cation by the legislature in favor of self-regulation by an industry, profes- 
sion, or other economic group. Sometimes several competing interest groups 
are brought into the nomination process, and the chief executive is required 
to select a certain number of his appointees from nominees of each of the 
Interest groups. Through such a balancing of special interests in its mem- 
bership it is supposed that the commission's decisions will come close to 
representing the public interest a supposition, it may be added, that 
students should regard with some skepticism. 

More importance is attached to the removal power than to any other 
criterion of independence. Unless a commissioner or head of an agency has 
security of tenure, he is in no position to challenge the policy instructions 
of the chief executive. Actually, few statutes place commissioners entirely 
beyond the executive's removal power. It is recognized that legislative im- 
peachment is too cumbersome a process to be the sole recourse against 
dishonest or inefficient public officials. In the case of independent commis- 
sions, however, the executive is generally restricted to certain specific reasons 
for removal. "Inefficiency, neglect of duty, or malfeasance in office" are 
fairly customary grounds for removal in federal statutes creating independ- 
ent commissions. These restrictions are enforced by the courts, as President 



INDEPENDENT REGULATORY ESTABLISHMENTS 211 

Franklin D. Roosevelt found to his sorrow when, early in the New Deal, 
he attempted to remove Commissioner William E. Humphrey from the 
Federal Trade Commission. However, the chief executive is allowed con- 
siderable discretion in deciding what actions do fall within the grounds for 
removal specified by statute. Removal is, of course, an extreme step that is 
rarely taken. Yet its existence or nonexistence as an ultimate sanction of the 
President's authority conditions the atmosphere in which commissioners 
consider his views on commission policy. 

Financial Support and Basic Authority. Freedom from reliance upon the 
chief executive and the legislature for financial support is an important 
criterion of independence. We should not underestimate the importance 
of executive budgets and legislative appropriations as annual or biennial 
power-bestowing and power-withdrawing instruments and, by natural 
deduction, instruments giving the chief executive and even individual 
legislators an influence upon the commission that they might not have 
otherwise. Commissions that finance themselves are generally free of this 
executive-legislative type of control. The Board of Governors of the Federal 
Reserve System is supported directly by assessment upon the reserve banks. 
And many state commissions on banking, insurance, public utilities, agricul- 
tural marketing, and professional licensing support themselves in whole or in 
part through assessment of fees on the companies and individuals subject to 
their regulatory authority. As a means to independence, financial support 
is an excellent instrument; but it runs counter to the whole emphasis in 
democratic history upon legislative possession of the power of the purse. 

As yet, the architects of independent establishments have failed to free 
such agencies from dependence on the legislative body for grants of regu- 
latory authority. Congress and the state legislatures create and abolish the 
powers of independent agencies. Every so often, therefore, an agency, how- 
ever independent by all the criteria just reviewed, must ask the legislative 
body for extensions of its jurisdiction and for more effective sanctions with 
which to enforce its decisions. It must also enter the legislative arena when- 
ever a bill is proposed to abolish or weaken the agency. 3 

Political Factors. Two final factors are important in freeing agencies 
from dependence on the chief executive, even though they are unrecognized 
by the statute books. One is the alliance of agencies with pressure groups 
whose economic and political power is sufficient to protect their wards 
against even such controls as are authorized by law. If a utilities commis- 
sion wins the favor of the utility companies, the banking commission comes 
to be regarded as the banks' creature, the fish and game commission is 
strongly backed by the well-organized sportsmen's associations, the labor 

3 A few state agencies are established and granted their powers by constitutional provision; 
dependence on the legislature is therefore lessened, but on occasion such agencies may have to 
participate actively in a campaign to influence an election on proposed constitutional amend- 
ments. 



212 INDEPENDENT REGULATORY ESTABLISHMENTS 

department can run for support to the great labor organizations, and 
the medical licensing board can turn to the influential medical association 
in such situations a chief executive and a legislature may readily be balked 
in their attempts to control these public agencies. 

The second factor is not unrelated to pressure-group alliances. It con- 
cerns the ability of the agency to develop political power sufficient to resist 
the chief executive's encroachments upon its independence. The courting 
of pressure groups is, of course, a major step in this direction. In addition, 
if an agency head controls a major faction in the chief executive's political 
party as some agency heads are appointed in recognition of such control, 
or if the agency has assiduously cultivated the good will of legislators and 
local party leaders, or if the agency head has established a public prestige 
that would cause the newspapers, educational leaders, civic organizations, 
and women's clubs to protest vigorously any executive trespassing on his 
authority in cases like these the chief executive will not "cross" the agency 
head without gauging accurately the political liabilities he might thereby 
assume. 

In part, of course, we are saying that regulation is essentially political, 
that it is concerned with the formulation of public policies. Over the years, 
the people have established legislative and executive instruments for policy- 
making and have placed emphasis on responsiveness of those instruments 
to public opinion. This responsiveness is periodically enforced at the polls 
and is less formally emphasized between elections in newspapers, corre- 
spondence, speeches, hearings, and through other channels. The people's 
legislative and executive instruments must, in turn, control the regulatory 
agencies, unless we err in speaking of the work of these agencies as policy 
formation. The problem may therefore in part be reduced to the questions: 
What is the nature of regulatory business? How should it be conducted? 

2. NATURE AND CONDUCT OF REGULATORY BUSINESS 

Regulation is governmental circumscribing of the range of permissible 
conduct of individuals and groups. The simplest regulations require that 
stop lights be observed, that houses not be robbed, that children attend 
school. In this type of regulation, characteristically the legislative body 
adopts a clear-cut rule defining public policy. It is a simple task then for 
policemen and truant officers to arrest apparent violators; and the courts 
have no serious problem, assuming sufficient evidence is presented, in de- 
ciding finally whether or not the law has actually been violated. 

Rule-Making and Case-by-Case Decision. However, regulation by mod- 
ern government goes far beyond the simple examples cited. In the less 
simple types of regulation the most dramatic feature is the extent to which 
legislative bodies delegate broad discretionary power to administrative 
igcncies. The legislatures despair of defining in crystal-clear terms the 
norms of conduct to govern economic or social life. Instead, they pass 



INDEPENDENT REGULATORY ESTABLISHMENTS 213 

laws requiring that railroad and power rates be "just and reasonable," that 
restaurants and dairies be "sanitary," that employers provide "reasonable 
protection to the lives, health, and safety" of their employees, that commer- 
cial practices not be "unfair or deceptive" or include "unfair methods of 
competition." The volume of legislative business, the lack of expertness 
on the part of the average legislator, and, perhaps, a disposition of the 
lawmaking body in some instances to "pass the buck," have all contributed 
to the trend toward vague statutes whose only precision is acquired by 
administrative and judicial action long after the legislature has completed 
its work. Whatever the cause, the administrative and judicial areas of 
discretion have been vastly increased by legislative inability to define pre- 
cisely what acts government regards as unlawful. 

Once the legislature has decided to delegate broad discretionary authority, 
the question of whether such authority should be exercised through tech- 
niques of a legislative, judicial, executive, or other character is posed. Most 
regulatory agencies use a combination of these approaches, but it is im- 
portant to note the practical significance of the several approaches because 
the emphasis given each differs. If emphasis is placed on a legislative 
technique, the agency will set about doing what the legislature failed to do 
define with some exactness the types of acts that will be treated as unlaw- 
ful. This it will do through the issuance of rules and regulations. For ex- 
ample, in most states there are industrial safety codes, issued by the state 
labor department, which describe specifically the types of safety precautions 
employers must take if they are to conform to the legislature's demand that 
employers provide safe conditions of employment. 

On the other hand, if the discretionary authority is to be exercised along 
judicial lines, the agency very probably will depend upon private individuals 
to bring cases formally to its attention, or it will on its own initiative hail 
suspected violators before its bar for an investigation, or it will require 
that individuals and companies proposing to take a particular line of action 
such as open a liquor store, extend a railroad's tracks, or practice medi- 
cine apply to the agency for a license or "certificate of convenience and 
necessity" before going ahead with the proposed action. Whichever of these 
approaches is followed, the agency will be deciding each case as it comes 
along, without paying too much attention to the need of industry and 
citizens for more reliable guidance as to permissible conduct than either 
the vague statute or the spotty pattern of past case decisions affords. 

The rule-making approach does have the advantage that the public learns 
relatively more promptly the standards by which it must abide. Further- 
more, in formulating such general rules, the regulatory agency can engage 
in thorough research and consult with representatives of all groups likely to 
be affected by the regulation. Thereby the agency frankly acknowledges that 
it is making public policy, that it needs to inform itself of all relevant eco- 
nomic facts, and that it desires the advice of all affected interests. 



214 INDEPENDENT REGULATORY ESTABLISHMENTS 

The case-by-case approach, on the other hand, leaves the public in the 
dark for years, in some instances, as to what the vague statute means. It 
often narrows the evidence to that presented in formal court-like hearings. 
It tends to ignore affected interests not represented by the two contending 
parties to each dispute. And it permits the introduction of considerations 
of public policy and public interest only as rather regrettable departures 
from "sound" procedure. 

The case-by-case approach reaches its greatest usefulness when the func- 
tion is genuinely one of settlement of disputes between two parties; as, for 
example, when an injured workman seeks compensation from an employer. 
Especially is this true where the statute, or a set of regulations having 
the force of law, fairly clearly establishes the standards to control the adjudi- 
cative work. What is needed then is simply a process that will: (1) let 
the two parties tell their stories and argue whether the facts fall within or 
without the area defined by the legislative standards; and (2) ensure that 
the decision is made by a man who will honestly weigh the evidence and 
arguments presented by the two sides and exercise wise judgment in ruling 
which contender should prevail. This clearly is a different situation from 
one where public policy needs to be defined, where the public interest needs 
to be vigorously advanced in an industrial area in which that interest has 
previously been subordinated to private interests, and where an important 
segment of the economy needs to know the "rules of the game." 

Administrative Approach. A third approach to regulation is usually 
thought of as executive or administrative in character. Most clearly con- 
nected with this approach is the regulatory function of inspection. It is the 
inspector who checks fire precautions in theaters and office buildings; visits 
factories to determine observance of industrial safety codes and laws govern- 
ing the employment of women and children; looks over barber shops, 
dairies, and restaurants to ensure sanitary conditions; stops cars on the high- 
way to prevent spread of the Japanese beetle; examines bank records to 
protect depositors against loss of their savings; surveys factory payrolls to 
enforce wage and hour legislation; and goes through railway trains to assure 
that their equipment complies with all necessary safety devices. Sometimes 
the inspector is a laboratory technician testing the quality of food and drugs. 
Sometimes, indeed, if the term has a reasonable degree of elasticity, he is an 
administrator and grader of examinations taken by candidates for licenses 
such as doctors, pharmacists, and barbers. 

The inspector is naturally more circumscribed in his function than an 
agency head promulgating rules and regulations affecting great industries; 
the inspector is often the implementer of such rules and regulations. Never- 
theless, he is no mere automaton answering "yes" or "no" to a form ques- 
tion as to whether his inspection reveals a violation. The modern inspector 
is often a missionary, charged with spreading awareness and understanding 



INDEPENDENT REGULATORY ESTABLISHMENTS 215 

of the law and the administrative regulations under the law. He is expected 
to tell people subject to his jurisdiction not only what the regulations are 
and the penalties for their violation, but also why the regulation is necessary 
and deserves voluntary compliance. Inspection and enforcement, in other 
words, thrive best when those subject to them are so educated and per- 
suaded that actual violations are few. 

This very emphasis on the inspector's educational function lends breadth 
to his discretionary powers. For discovery of a first violation is often used 
as an opportunity for an educational interview with the violator, rather than 
for punishing him. Whether this educational approach is followed twice 
or thrice with the same violator, or on the other hand is rejected even for 
a first violation in favor of prompt punishment, is largely a matter for the 
inspector's judgment as to which course will best serve the public interest. 
It is noteworthy that for laxity in enforcement by the inspector there is 
generally no judicial remedy. The public interest, in other words, is pro- 
tected only by the administrative means of the inspector's removal or repri- 
mand by his administrative supervisors. 

Regulatory officials and scholars alike have often questioned the attempts 
to define regulatory approaches as either legislative, judicial, or executive. 
One basis of their questioning is the frequency with which two or three of 
these approaches are combined in the same agency. In practice the rules-and- 
regulations approach, which is of a legislative character, and the case-by-case 
approach, which is more judicial in orientation, are often found together. 
For instance, in some states the so-called workmen's compensation board 
both formulates industrial safety codes and hears individual cases of work- 
men claiming compensation for injuries sustained in industrial accidents. 
The War Production Board promulgated orders applicable to whole indus- 
tries, heard appeals from individuals seeking exemption from those industry- 
wide orders, and also heard violation cases. In addition, naturally, regulatory 
agencies have executive or administrative responsibilities. A notable case 
among the independent agencies is the Interstate Commerce Commission, 
which enforces a variety of statutes designed to ensure safe operation of 
the railroads; under one of these statutes its inspectors examine over one 
hundred thousand locomotives each year. 

Mixture of Approaches. In fact, the mixture of legislative, executive, 
and judicial approaches has been one of the principal arguments for estab- 
lishment of the independent commissions. The reasoning runs that, under 
the doctrine of the separation of powers, none of the three great branches 
of government may exercise powers constitutionally belonging to either of 
the other two branches. Consequently, a regulatory agency exercising a 
combination of legislative, executive, and judicial powers cannot constitu- 
tionally belong to any one of the three branches. Hence, the regulatory 
commissions must be independent. This reasoning overlooks the fact that 



216 INDEPENDENT REGULATORY ESTABLISHMENTS 

a number of the executive departments and agencies perform all three types 
of function. 4 

The second basis for questioning the attempt to categorize different types 
of regulatory action as legislative, executive, and judicial arises from a 
belief that this classification loses sight of the real heart of regulation, which 
is fact-finding. It is stressed that every major determination by government 
in the regulatory sphere should be preceded by an earnest effort to find the 
facts. This may involve broad research in the economics, history, and ad- 
ministrative phases of the general problem, investigation of the records of 
companies most affected by the proposed decision, collection of statistics 
from the industry on a periodic basis to provide factual background for 
all of the agency's decisions, and consultation with experts and interests 
likely to be directly or indirectly affected by the proposed decision. Con- 
sultation might be secured by formal hearing, by interviews through mem- 
bers of the agency's staff, or by correspondence. It should be directed to 
getting both facts and opinions or arguments. 

This is a more comprehensive approach than any attempt to put regu- 
latory activities into neat packets labeled "legislative," "executive," and 
"judicial" for the purpose of using distinctive procedures for each. Since it 
is convenient to argue by analogy, those who take this fact-finding approach 
say that its nearest kin is the approach of legislative committees. 5 The 
distinguishing features of the legislative committee are these: (1) it takes 
the initiative in seeking economic and social facts and opinions as a basis 
for guiding the judgment of the legislative body; (2) it recognizes that in 
pursuing facts to guide public policy, the cumbersome procedure of law 
courts would both consume undue time and obstruct the assembling of rele- 
vant evidence; (3) it works on the assumption that its members are the 
seekers of the truth and may take an active part in the questioning of wit- 
nesses, without impairing each member's ability to arrive at unbiased judg- 
ments on the basis of the facts and the policy issues involved; (4) it is a 
testimonial to the principle of delegation, for although the legislature itself 



4 Federal administrative agencies exercising rule-making and adjudicative powers over 
private individuals arc listed in Attorney General's Committee on Administrative Procedure, 
Administrative Procedure in Government Agencies, p. 261 ff. t 77th Cong., 1st Sess., Senate 
Doc. No. 8, 1941. 

5 An interesting feature in the evolution of the independent commission is that the earliest 
important commissions those concerned with railroad regulation were regarded as arms of 
the legislative body to investigate and recommend rate-fixing measures. Part of the reason for 
the adoption of procedures more like those of courts than like those of legislative committees 
was probably the early domination of the Interstate Commerce Commission by Judge Thomas 
M. Coolcy, and the initial appointment of no one but lawyers to that commission. Board of 
Investigation and Research, Report on Practices and Procedures of Governmental Control, p. 
59 ff., 78th Cong., 2d. Sess., House Doc. No. 678. 1944. 



INDEPENDENT REGULATORY ESTABLISHMENTS 217 

makes the ultimate decision, it cannot as such take all the evidence neces- 
sary for a sound decision, and instead relies on the legislative committee as 
its agent, to assemble the data and recommend appropriate legislation; and 
(5) it has an awareness that at public hearings everyone may be represented 
except the public, and that in order to guard resulting legislation from 
being swayed too much by the particular witnesses and the most vociferous 
special interests, the committee members must themselves keep the 
public interest constantly in mind in thinking through their policy 
recommendations. 

In legislative committees as in courts, executive agencies, and independ- 
ent commissions the extent to which particular methods serve as media 
for arriving at sound decisions depends more upon the men seeking the 
facts and making the decisions than upon mechanical rules of procedure. 
Nonetheless, it is apparent that a regulatory agency that followed the model 
of tjie legislative committee would conduct itself differently from one that 
thought of itself as an expert court for the impartial adjudication of contro- 
versies brought before it by aggrieved parties. 

Judicial Control. This brings us to the vital problem of procedures. One 
startling aspect of the problem deserves special emphasis. Although the 
courts have been very much concerned about the procedures followed in 
reaching administrative decisions bearing on specific individuals or cor- 
porations that is, court-like decisions they have shown little interest in 
the question of safeguarding procedures in the formation of general regu- 
latory policy through rules and regulations. True, the courts insist that legis- 
lative bodies must not completely abdicate. They must canalize and set 
bounds to the discretionary powers delegated to each regulatory agency. 
But that hurdle past, the agency has been left relatively free by the 
courts to arrive at its general rules and regulations by any procedure it 
deems wise. 

Considerations of sound public policy often dictate a democratic con- 
sultation of affected interests before a general regulation is issued. State 
labor departments usually establish panels or committees drawn from labor 
unions and management to help in drafting industrial safety codes. The 
United States Department of Agriculture has developed an elaborate system 
of county committees of farmers with whom questions of departmental 
policy can be discussed. Wartime agencies, particularly the War Production 
Board and the Office of Price Administration, used both industry advisory 
committees and labor advisory committees, which were consulted in connec- 
tion with the drafting of hundreds of industry-regulating orders. Although 
in practice the formulation of rules and regulations is no haphazard dicta- 



218 INDEPENDENT REGULATORY ESTABLISHMENTS 

tion by uninformed bureaucrats, the courts cannot claim credit for this fact. 6 
Their control over the rule-making power stems from the same roots as 
their control over the power of legislatures. That is to say, the courts have 
reviewed the substance of rules and regulations as they have that of laws, 
while largely leaving the procedures involved in rule-making to the discre- 
tion of the administrative agency. Rules and regulations have been held 
invalid when their provisions appeared to the courts either to exceed the 
grant of power made by the legislature or to be unreasonable in terms of a 
departure from accepted canons of fairness. 

We have been talking about rules and regulations of rather broad cover- 
age usually a whole industry or a large segment of an industry. The courts 
have whittled down procedural freedom in rule-making, however, by insist- 
ing that where a rule, a regulation, or an order was to be quite specific 
in its application where it would, for example, fix rates to be charged by 
individual utilities something like court procedures would be necessary. 
Here, curiously, the courts admit that rate-fixing is a legislative, not a 
judicial function; but nonetheless they insist that the procedures in rate- 
fixing be of a judicial character. 7 

Basically this means that such rate-determination must be preceded by 
notice to the affected parties and opportunities for them to be heard. With 
this principle established, the main dispute has been over the character of 
the hearing that is required. The courts, while always granting that their 
own rigid procedures need not be followed, have at times imposed proce- 
dural straitjackets on regulatory departments and commissions. As a result 
these had to abandon many practices that seemed perfectly legitimate 
by analogy with administrative agencies and legislative committees, espe- 
cially if we recall that legislatures may directly fix rates without court-like 
procedures. According to one decision, 8 a full hearing involves the right to 
introduce evidence, to know all the evidence that is to be considered by 
the regulatory officials in fixing the rates, to have opportunity to refute that 
evidenceincluding the right to cross-examine witnesses and to have the 
final decision supported by substantial evidence. 

6 Some statutes required notice and hearing prior to issuance of general rules and regula- 
tions, but generally this was not the case. The Walter-Logan bill, which on the eve of our 
entry into World War II nearly became law, included a provision that "all administrative rules 
. . . shall be issued by the head of the agency . . . and by each independent agency . . . after 
publication of notice and public hearings." Only rules governing hearing procedure itself were 
to be exempted from this blanket requirement. The proposal was not favored by the Attorney 
General's Committee on Administrative Procedure. See Duane, Morris, "Mandatory Hearings in 
the Rule-Making Process," Annals of the American Academy of Political and Social Science, 
1942, Vol. 221, pp. 115-122. The Administrative Procedure Act of 1946 represents another 
attempt at defining general requirements. For a discussion of the main features of this law, 
sec below Ch. 23, "The Judicial Test." 

7 See Hart, James, An Introduction to Administrative Law, p. 265, New York: Crofts, 
1940. 

8 Interstate Commerce Commission v. Louisville & Nashville Railroad Company, 227 U. S. 
88 (1913). 



INDEPENDENT REGULATORY ESTABLISHMENTS 219 

Even where a hearing is initiated with the declared purpose of inquiring 
into a particular company's rates, it has been held inadequate unless the 
agency provides notice of the specific rates it proposes to promulgate, and 
enables rebuttal of its proposal. 9 Fortunately, the courts have not insisted 
that commissions and executive departments take over wholesale the elabo- 
rate rules of evidence that are the lawyer's stock in trade. We can say "for- 
tunately," having noted the Interstate Commerce Commission's statement 
forty years ago that probably "not a single case arising before the Commis- 
sion could be properly decided if the complainant, the railroad, or the Com- 
mission were bound by the rules of evidence applying to the introduction of 
testimony in courts." 10 

Of course, there are cases of regulation where the objective is similar to 
that of the courts a specific decision in a case between two private parties, 
such as a worker and his employer, or between a government agency and 
a private party. In such cases, the general principles of procedure applicable 
to conduct of court business are pertinent, though softened by noninsistence 
upon rigorous observance of the rules of evidence. Again, notice and 
hearing are the basic requirements. 

Courts can only set the formal outer bounds of regulatory procedure. 
Eclipsing the importance of any such judicial strictures upon regulatory 
agencies are the caliber of men given regulatory responsibility and the 
depth of their understanding of the relation of government to individual 
citizens and enterprises in a democracy. What is required is a positive de- 
sire for achievement of the public interest. However, this desire must have 
much more balance than the witch-hunting mood of aggressive public 
prosecutors. Coincident with a positive desire for achieving the public 
interest must be an understanding of the need for avoiding government 
by decree without advance consultation with affected interests and oppor- 
tunity for all relevant facts to be considered. Yet such understanding must 
not lull the regulatory official into an overemphasis on individual rights 
to the point where the rights and interests of the general public are over- 
looked. The task of devising regulatory procedures that satisfy both public 
and private interests and are well adapted to particular functions is a 
challenge to legislatures, courts, and, above all, the regulatory agencies 
themselves. This was clearly recognized by the Attorney General's Com- 
mittee on Administrative Procedure. 

Proposals of Attorney General's Committee on Administrative Procedure. 
The most important inquiry into regulatory procedures in recent years was 
that of the Attorney General's Committee, which submitted its report early 
in 1941. The committee's more significant recommendations were embodied 

9 Morgan v. United States, 304 U. S. 1 (1938). See also Morgan v. United States, 298 
U. S. 468 (1936), where the Supreme Court insisted that the Secretary of Agriculture per- 
sonally had to consider and appraise the voluminous evidence in a case under the Packers and 
Stockyards Act before fixing rates, since the act vested the rate-fixing authority in him. 

10 Interstate Commerce Commission, Annual Report for 1908, p. 10. 



220 INDEPENDENT REGULATORY ESTABLISHMENTS 

in a bill, proposed for consideration by Congress. We may group them 
under four headings. First with respect to rule-making, the bill would 
require extensive publication of policies, interpretations, rules, regulations, 
and procedures; annual reporting to Congress on rules issued by the agency 
and rules proposed by private citizens; and designation by each agency of 
some unit or official to be responsible for keeping rules up-to-date and for 
receiving suggestions from the public. The bill would also stipulate a delay 
of forty-five days between the promulgation of an order and the date it be- 
comes effective, subject to waiver by the order-issuing agency. Second, with 
respect to centralized governmental responsibility for regulatory procedures, 
the bill would create an Office of Federal Administrative Procedure, the di- 
rector of which would investigate any and all aspects of regulatory procedure, 
submit his recommendations to Congress and the individual agencies, and 
appoint hearing commissioners to serve in most regulatory agencies. Third, 
the bill's major provision for administrative adjudication calls for the hold- 
ing of all initial hearings by these hearings commissioners, except where 
agency heads themselves can hold all hearings. Decisions of the hearing 
commissioners in the cases they heard would be final, unless appealed to the 
agency heads. And fourth, to reduce uncertainty as to whether proposed 
private actions would be permitted by a regulatory agency, the bill would 
authorize the issuance of declaratory rulings. Although issued before alleged 
violation has occurred, these rulings would have the same binding effect as 
an agency decision in an ordinary case. It is not too much to say that the 
work of the Attorney General's Committee has had a very beneficial effect 
on the character and the tenor of the Administrative Procedure Act of 
1946. 11 

Worth noting is the committee's sympathetic understanding and encour- 
agement of informal methods of adjudication. The committee observes, 
". . . even where formal proceedings are fully available, informal procedures 
constitute the vast bulk of administrative adjudication and are truly the 
lifeblood of the administrative process." 12 However, without detracting from 
the utility of extensive reliance on informal procedure in appropriate cases, 
two facts should be underscored. In the first place, adoption of informal 
procedures, involving bargaining with private interests in order to arrive 
at a mutually acceptable course of action, is often resorted to by regulatory 
agencies to avoid the cumbersome quasi-judicial procedure imposed on them 
by courts, to get prompter compliance by the regulated interests instead of 
the delays entailed in a judicial review of a formal regulatory decision, and 
to by-pass the danger of having the decision overturned by the courts. In 
the second place, cases settled by informal procedure, because of their infi- 
nitely greater volume than that of formal cases, may sacrifice the public 



the committee's bill, see op. cit. above in note 4, pp. 191-202. On the Adminis- 
trative Procedure Act of 1946, sec below Ch. 23, "The Judicial Test." 
12 Op. cit. above in note 4, p. 35. 



INDEPENDENT REGULATORY ESTABLISHMENTS 221 

interest and private rights, while on the other hand lawyers and courts are 
insisting that formal cases be settled with the elaborate paraphernalia of 
the courtroom. This, of course, is not to condemn informal procedure. 
It does, however, suggest the perils in treating regulatory procedure as 
something concerned with cases of the type that appear on a law court's 
docket, rather than as something concerned with, for example, the hundreds 
of thousands of items of business that are handled annually by the Inter- 
state Commerce Commission, mainly through its subordinate officials. 

The problem of regulatory procedures will never cease to be perplexing, 
for it consists essentially of the delicate task of achieving a balance between 
public policy and private rights, between form and substance, and between 
men and procedures. The problem is complicated by the fact that this bal- 
ance is not the same for each regulatory function. Procedures must be 
adapted to the particular tasks assigned to regulatory agencies by the 
legislative body, 

3. THE RECORD OF INDEPENDENCE 

Regulation by Independent Commissions and Executive Departments. 
In the federal government the number of independent regulatory establish- 
ments has never been large. Their significance results rather from the im- 
portance of the economic areas over which they have jurisdiction than from 
their number. There are only nine so-called independent regulatory com- 
missions or boards: the Interstate Commerce Commission, the Board of 
Governors of the Federal Reserve System, the Federal Trade Com- 
mission, the Federal Communications Commission, the Federal Power 
Commission, the Securities and Exchange Commission, the National 
Labor Relations Board, the United States Maritime Commission, and the 
Civil Aeronautics Board. These bodies in the aggregate have vast powers 
over transportation by rail, bus, pipeline, ocean, and air; communication 
by telephone, telegraph, and radio; the "rules of the game" by which trade 
and commerce are kept fair and competitive; the supply of electric power 
across state lines at reasonable rates; the supply of money and credit, the 
issuance of stocks and bonds, and the operations of stock exchanges; and the 
maintenance of collective bargaining unfettered by unfair practices on the 
part of employers. 

These boards and commissions have five members each, with the excep- 
tions of the Federal Reserve System and the Federal Communications Com- 
mission, each of which has seven members, and the Interstate Commerce 
Commission, with the unwieldy number of eleven. Through staggered 
terms of five, six, or seven yearsexcepting the Board of Governors of the 
Federal Reserve System, whose members serve for 14 years and bipartisan 
membership not required for this board or the National Labor Relations 
Board these establishments are intended to be independent of any partic- 
ular chief executive. Although the President may remove members of 



222 INDEPENDENT REGULATORY ESTABLISHMENTS 

most of them only for inefficiency, neglect of duty, or malfeasance in office, 
he presumably has a free hand on removals of members of the Pfcderal 
Power Commission, Securities and Exchange Commission, and Federal Com- 
munications Commission, for the statutes set up no bars to his freedom of 
action in these cases. In most instances the President designates the commis- 
sion chairman. However, in the important cases of the Interstate Commerce 
Commission, Federal Trade Commission, and Federal Power Commission 
the membership itself selects one of its number as chairman. 13 

It is important to note that regular executive departments exercise regu- 
latory powers of a character not unlike that entrusted to the independent 
commissions. As Professor Robert E. Cushman points out, "Congress has 
followed no consistent principle in assigning regulatory functions to inde- 
pendent agencies rather than to other units in the national government. 
There seems to be nothing about the regulatory job which makes it impera- 
tive that it be handled by the same kind of administrative body." 14 The 
Department of Agriculture with its regulation of packers and stockyards 
as well as commodity exchanges, and in all some forty regulatory statutes, is 
an outstanding example in this respect. The Departments of Commerce, 
Interior, Labor, and the Federal Security Agency with its Food and Drug 
Administration also control important economic activities. 15 

During World War II, vast regulatory authority was entrusted to single- 
headed agencies such as the Office of Price Administration, War Production 
Board, War Manpower Commission, Petroleum Administration for War, 
Solid Fuels Administration, War Food Administration, and Office of 
Defense Transportation. It may be added that in performance, both the 
independent commissions and the single-headed agencies have shown suc- 
cesses and failures. 

Clientele Departments and Directive Power. Among the single-headed 
departments, two problems have been paramount. One has been the special- 
interest taint of the three departments that would be the most likely 
single-headed agencies for exercise of regulatory powers: the Department 
of Commerce, the businessman's friend; the Department of Labor, the 

13 Sec Cushman, Robert E., The Independent Regulatory Commissions, p. 760 ff., New 
York: Oxford University Press, 1941. 

Ulbid.,?. 10. 

15 The Brookings Institution has suggested that the executive departments regulate and 
control business through an exercise of what is virtually the "police power," in the interests of 
public health, safety, and the prevention of fraud. Here the only factors involved arc a fixed 
rule of law, a charge that the law has been broken, and a decision. The work of independent 
commissions, on the other hand, is distinguishable because it involves questions of public 
policy on large economic problems, questions of complicated economic relationships, and prob- 
lems of public management. For this point, see Senate Select Committee to Investigate 
the Executive Agencies of the Government, Report No. 10 of the Brookings Institution, 
Government Activities in the Regulation of Private Business Enterprise t p. 61 ff., 75th Cong., 
1st Sess., 1937. See also Benson, George C. S., "Administrative Regulation within Federal 
Departments," Annals of the American Academy of Political and Social Science, 1942, Vol. 
221, pp. 64-71. 



INDEPENDENT REGULATORY ESTABLISHMENTS 223 

worker's especially the union's friend; and the Department of Agricul- 
ture, the farmer's friend. Thus a problem arises whenever, for example, 
there is need for regulation of both employers and workers to assure col- 
lective bargaining, prevent unfair labor practices, facilitate the settlement of 
labor disputes, or control wages and hours. Should such functions be as- 
signed to the Department of Labor, or would that interfere or, what is 
equally important, give grounds for suspicion of interference with fair 
treatment of the employers' interests? 

The second problem about single-headed departments has been the ex- 
tent to which particular kinds of regulatory work may be slighted because 
of the influence of the department head or the President. The Justice 
Department, for instance, having limited funds and staff like any other 
agency, must choose where it wishes to concentrate these resources. Some- 
times, especially under a conservative administration, prosecutions for viola- 
tion of antitrust laws may be relatively infrequent. Under a different kind 
of administration, and without any change in the law, the Justice Department 
may launch a full-scale crusade against monopolies. One of the principal 
justifications for the independent commissions is the argument that, because 
of their staggered-term arrangement and relative freedom from execu- 
tive domination, they have greater continuity of policy than executive 
departments. 

Struggle for Control Over Independent Commissions. In the federal 
government there has been a continuing struggle for power over the in- 
dependent commissions and boards. The protagonists have been the 
President, Congress, the courts, the regulated interests, and the regulatory 
agencies themselves. Congress is most powerful when a commission is 
being created or when bills are before Congress for increasing or decreasing 
the responsibilities of particular commissions. Congress may see a need 
under various conditions for assigning functions to an independent com- 
mission having theoretically closer ties to the legislature than to the Presi- 
dent. Such conditions are given when: (a) Congress wants to set up a 
function on an experimental basis, with the intention of passing a more 
precisely worded statute after the commission has felt its way into the prob- 
lem and developed the experience out of which such a statute can be 
drafted; (b) Congress intends to organize a function that is largely 
investigational and designed to lead to recommendations for legislation 
remedying the economic maladjustments the agency uncovers much as a 
legislative investigating committee might work; (c) Congress is defining 
a function so vaguely and mixing various kinds of responsibilities in such 
a way that the agency will exercise powers of legislative and judicial char- 
acter as well as of an executive character; it is, therefore concluded that 
under the doctrine of the separation of powers, the function should not be 
vested in any of the three branches of the government; (d) Congress is 
disinclined to enhance the power of the executive branch simply because 



224 INDEPENDENT REGULATORY ESTABLISHMENTS 

this detracts from the prestige and strength of Congress; (e) Congress is 
distrustful of the particular President or department heads in office because 
the administration is guided by a political party, faction, or philosophy 
different from that of Congress; (f) Congress cannot find an executive 
department in which the new function would readily fit; and (g) Congress 
is under considerable pressure to afford representation in the administra- 
tion of a regulatory statute to more than one region, industry, or party. 

On occasion, when Congress and the executive branch are under the 
same political control, they may jointly advocate creating an independent 
commission to handle a new and important regulatory power. The reason 
might simply be that under such an arrangement the President can name 
all the members of the new commission. Because of the long, though 
staggered terms of commissioners, he can thus perpetuate his party's control 
of the particular function into and possibly through the next presidential 
term. *- 

The President is, of course, the protagonist most frustrated by his lack 
of control over the execution of some of the most important statutes that 
Congress ever passed. Every president for about the past forty years has 
sought to control one or more of the independent commissions. 10 By his 
appointments and removals; his close relations with the chairmen of some 
of the commissions; his ability to mobilize public opinion; his budgeting 
authority; and much of the time his standing with Congress by all these 
means the President, whoever he may be, has been able repeatedly either 
to influence commissions directly or to put them on the defensive in a 
public battle in which he has certain advantages. Nevertheless, the com- 
missions retain imposing powers of resistance to presidential direction. 

Humphrey Case. The most conspicuous instance of a presidential at- 
tempt to control an important commission resulted in judicial support 
for the congressional doctrine of independence of regulatory commissions. 
The Federal Trade Commission, created in 1914 under the Wilson Ad- 
ministration, had been given important powers to attack unfair methods of 
competition and unlawful trade practices and to investigate business mis- 
conduct. Before it was four years old this commission had shown that it 
interpreted its mandate literally, and intended to carry it out in a vigorous 
manner. Its attitude, particularly evidenced by the commission's blistering 
attack on the monopolistic practices of the meat-packing industry, aroused 
the bitter resentment of much of the business world. 17 It is not surprising 
that under the more conservative administrations of Presidents Harding, 

16 Cushman, op. cit. above in note 13, p. 681 ff. 

17 As a result of the packing industry's hostility to the Federal Trade Commission, adminis- 
tration of the Packers and Stockyards Act of 1921 was assigned by Congress to the Secretary of 
Agriculture, an action that met with the packing industry's favor because it preferred even a 
farmer's and rancher's friend to the shrewd, aggressive commission that had so effectively 
exposed the practices of the industry. 



INDEPENDENT REGULATORY ESTABLISHMENTS 225 

Coolidge, and Hoover, a conscious effort was made to put men on the 
Federal Trade Commission who would have less crusading zeal and who, 
to a considerable extent, would exercise the commission's powers at sonw 
thing less than their maximum extent. 18 William E. Humphrey, appointed 
to the commission by President Coolidge in 1925, dominated it between 
1925 and 1933 because on most important issues he could count on the 
votes of the other two Republican commissioners. Now collusion with, 
rather than control of, trusts and monopolies by the Federal Trade Com- 
mission was talked about on the floor of the House of Representatives. 

Shortly after Franklin D. Roosevelt was inaugurated, he asked Com- 
missioner Humphrey to resign, pointing out that Humphrey's policy was 
not in harmony with the President's policy on the work of the Federal 
Trade Commission. On the Commissioner's refusal, the President re- 
moved him. Eventually, the Humphrey case reached the Supreme Court. 
Humphrey's position had rested on the Federal Trade Commission Act, 
which provided for presidential removal of commissioners "for inefficiency, 
neglect of duty, or malfeasance in office." The chief executive, the argu- 
ment went, had violated this act in removing Humphrey not for any of 
these reasons, but for incompatibility with the President's views on policy 
matters. The President, on the other hand, relied on the Supreme Court's 
earlier decision and opinion in Myers v. United States, 19 in which it was 
held that Congress could not constitutionally restrict the power to remove 
any executive official in this case, a postmaster whom the President had 
appointed either alone or with the advice and consent of the Senate. 20 

This was declared to follow logically from a consideration of the Presi- 
dent's constitutional possession of the executive power, the power of ap- 
pointment, and the responsibility for taking care that the laws be faithfully 
executed. And in a dictum the majority of the Supreme Court, led by 
Chief Justice Taft, clearly indicated that the President has an unfettered 
right under the Constitution to remove members of quasi-legislative and 
quasi-judicial bodies. However, in the Humphrey case the Supreme Court 
abandoned this dictum. It held instead that where there is a body exer- 
cising primarily quasi-legislative and quasi-judicial duties and only inci- 
dentally administrative or executive functions, such as the Federal Trade 
Commission, Congress may by statute specify the causes for which members 
can be removed by the President. In a case like this, the statute is binding 

18 It is notable that in this same period the Antitrust Division of the Department of 
Justice showed none of the enthusiasm for its work apparent in the Wilson and Franklin D. 
Roosevelt Administrations, and that the Supreme Court, dominated by conservative justices, 
subjected the Federal Trade Commission to a rigorous doctrine of judicial review of com- 
mission decisions. 

10 272 U.S. 52 (1926). 

20 The specific attempt to restrict the President's removal power consisted of congres- 
sional insistence that the President obtain the consent of the Senate before removing incumbents 
of certain executive offices, such as postmastcrships, to which the appointment had been by 
the President with the advice and consent of the Senate. 



226 INDEPENDENT REGULATORY ESTABLISHMENTS 

on the President, and he cannot remove for causes not specified in the 
statute. The Humphrey case in effect recognized a fourth branch of gov- 
ernment, consisting of the independent commissions. A commission such 
as the Federal Trade Commission is "wholly disconnected from the execu- 
tive department" and is instead "an agency of the legislative and judicial 
departments." 21 

Experience in the States. In the states certain factors have given the 
problem of independent commissions a different setting than in the federal 
government. 21 * Generally the legislature meets more infrequently for in- 
stance, meeting only once every two years. Thus it is more difficult for the 
apologist for independent commissions to argue that, though independent 
of the executive, they are given effective supervision and coordination by the 
legislative branch. In the second place, the general atmosphere of many state 
governments is more definitely political, with emphasis on patronage, 
favoritism, and subservience to pressure groups. In states where this atmos- 
phere exists and it does not exist in all the departments responsible to the 
governor, those responsible directly to the people, and the independent 
commissions are all affected. The agencies that come nearest to escaping 
this atmosphere are those with professionalized staffs, such as the state 
health department, the state v. elfare department, and the state university. 

Such service agencies with professional staffs are likely to have a tradi- 
tion of both integrity and skill. They also are backed by public opinion 
or organized blocs of opinion in resistance to political pressures. In addi- 
tion, they have largely administrative rather than policy decisions to make. 
In contrast, the heart of economic regulation is policy, and the people are 
ill-served if they have no effective way to bring sanctions against the regu- 
latory commissions, which seem to float in mid-air, unanswerable directly 
to either of the two political branches of government, executive and legis- 
lative. These factors suggest that the people would be better advised to let 
service agencies, rather than regulatory bodies, have a high degree of 
independence. 

Both the degree of political favoritism running through the conduct of 
public affairs in some states and a general fear of strengthening the office 
of governor when experience reveals the possibility that a charlatan may 
be elected to the post, result often in a general desire for the independence of 
all agencies service and regulatory that have important work to do. While 
this has an appealing appearance of "facing the realities," it leaves the 
governor with little responsibility, removes administration of a large num- 
ber of governmental policies from effective public control, and in some 
cases causes a relative increase in the control of agencies by special-interest 
groups. No one is left to call regulatory officials on the carpet promptly 

21 Humphrey's Executor v. United States, 295 U. S. 602 (1935). 

22 See Fesler, James W., The Independence of State Regulatory Agencies, Chicago: 
Public Administration Service, 1942. 



INDEPENDENT REGULATORY ESTABLISHMENTS 227 

if they are neglecting the public interest. The spur to action is gone, for 
the public itself is not overly vigilant about the day-to-day acts of regulatory 
agencies. On the other hand, the special interest groups are likely to be 
well organized in their efforts to soften the rigors of regulation. 

In the experience of the states there is no ready-made solution to the 
problem of the independent regulatory bodies. The nearest to a solution 
we can come is to adopt the firm position that policy-making agencies 
must be controlled by the people through their political instruments, the 
legislature and governor. Since the legislature meets infrequently, and 
is in any event ill-equipped to provide real supervision and coordination of 
the regulatory agencies, the governor must be the principal instrument of 
popular control. That he is a politician, sometimes even a demagogue or 
a tool of special interests, cannot be denied. Nor can it be denied that regu- 
latory officials may have the same defects, for politicians are often elected or 
appointed to these positions. Certainly, however, if "democratic govern- 
ment" has any meaning at all, it is that policy must be decided or con- 
trolled by the people. To set the regulatory agencies free of this control 
is to insulate important areas of economic policy against effective popular 
governance. 

Much more important than any mechanical changes, though, would be 
a general improvement of the "tone" of state government. This would 
bring better men to the legislature and to the governor's office. Such a 
change in turn would bring good men to the regulatory agencies. 

4. THE PRICE OF INDEPENDENCE 

Popular Illusions. The idea of independent regulatory agencies has an 
appeal to citizens who think of politics as something unclean, of legislators 
as controlled puppets, and of chief executives and their department heads as 
spoilsmen intent primarily on perpetuating themselves in power. On the 
other hand, the same citizens are likely to respect the courts and to regard 
judges as wise and well-balanced men with an unusual capacity for dis- 
covering the "right" solution to any problem of law, fact, or policy. How- 
ever, even a casual look at legislatures, courts, and executive departments 
should reveal the extent to which men and women in the course of their 
public careers serve in two and often three of the branches of government. 
It should also make evident the injustice of characterizing in blanket fashion 
as incompetent and corrupt the officials in any of the three branches of 
government. 

The relevance of this consideration to our topic lies in the tendency of 
many citizens to support independent commissions as a means of bringing 
judge-like wisdom, balance, and insight into the process of regulation of 
business and industry. Such an approach ignores two basic facts. One 
is that those appointed or elected to the independent commissions are often 
the same men who before or after their term on the commission have served 



228 INDEPENDENT REGULATORY ESTABLISHMENTS 

or will serve as state legislators, governors, members of Congress, or execu- 
tive officials. Some may also be defeated candidates for political office, or 
men thought of primarily for past or potential favors to the political party. 
The second fact ignored by commission enthusiasts is the very great dan- 
ger in any doctrine that pretends that we can preserve democracy and still 
vest economic powers in a governmental agency that is not clearly subject 
to officials who in turn are responsible to the people. The proposition is 
simply that policy is the very thing to be kept under effective popular con- 
trol if democracy is to survive. And many regulatory commissions make 
more important policies, by both action and inaction, than do ordinary 
departments. Almost by definition, a regulatory commission is set up to 
establish policies that the legislative body has not been able to determine 
in any specific way. 

Need for Policy Coordination. This emphasis on policy as the focal 
problem of popular control of governmental regulation leads to another 
main consideration. It is the need for coordination of the policies that are 
being adopted and executed by the scores of agencies executive and inde- 
pendent in any government, on the state or federal level. Clearly, the 
citizenry has a right to demand that someone prevent its government's 
right hand from undoing what its left hand has been trying to do. The 
very size of federal and state administration makes perfect coordination im- 
possible. However, the existence of commissions with great regulatory 
powers claiming virtual independence of the chief executive seriously 
handicaps attempts to approximate even a rough-hewn sort of coordination. 

Let us suppose a railroad situation in which the problem involves rates, 
a violation of the antitrust laws, a labor dispute, competition by river boats 
and barges, an anti-inflation policy, and a loan from the Reconstruction 
Finance Corporation. The railroad would be at the mercy of almost as 
many agencies as there are specific parts to the problem. If the problem had 
sufficient importance to rise to the President's level, he could himself or 
through an aide get the executive agencies together and insist upon a sen- 
sibly articulated set of policies for meeting the situation. The Interstate 
Commerce Commission, however, with its control over rates as part of our 
hypothetical puzzle, could stay away from the conference. Or, if in attend- 
ance, it could decline to "go along" with the other agencies on a solution. 

Lethargy of Independence. Problems of this character are not fanciful. 
An illustration is the President's inability to stir the Interstate Commerce 
Commission out of apparent lethargy on the vital policy problem of south- 
ern and western freight rates. He deliberately appointed a southern 
expert on the subject as a commissioner. He underlined the importance of 
Tennessee Valley Authority freight-rate studies by special messages to Con- 
gress on the subject, with a sidelong glance at the commission. And his 
Attorney General sued the western railroads for violation of the antitrust 
laws. All that did not move the mountain. Finally the state of Georgia 



INDEPENDENT REGULATORY ESTABLISHMENTS 229 

brought the issue to the Supreme Court on the charge that the railroads had 
conspired to discriminate in their rates against the South. By implication, 
the Interstate Commerce Commission was accused as an accessory to the 
alleged crime. In May, 1944, shortly after the Supreme Court took jurisdic- 
tion of the case, the commission roused itself to issue a decision favoring 
both the South and the West, but still not meeting the full issue head-on. 

Here was an instance where a great policy issue fell within the juris- 
diction of an independent commission. The President was apparently 
powerless to prod the commission to action. The Supreme Court finally 
assumed jurisdiction over this policy issue on the basis of an antitrust suit 
brought by a state. Only then did the commission announce a decision, 
the timing of which suggested an attempt to beat the Supreme Court to the 
draw. 

Pressure for Reform. Such intransigence or even the clashing of gov- 
ernment agencies without ready means of settling their disputes may be 
charitably tolerated during periods when government is relatively inac- 
tive and disposed to let business enterprises "have their head." However, 
when government's function is conceived as positive in character, as a 
conscious guidance of economic forces to achieve maximum production 
for wartime needs or full employment in times of peace, the people and 
the business community itself insist that there be a consistency among gov- 
ernmental policies and among the actions of governmental agencies in 
executing those policies. 

This does not mean dictatorship; far from it. It does mean an organi- 
zation such as any well-run business enterprise would insist on subordina- 
tion to a president or general manager of virtually all functions that the 
board of directors does not itself perform. The president-manager can then 
be held responsible for seeing that the gears of the enterprise mesh rather 
than clash. Only thus will all parts of the company pull together instead 
of pulling in opposite directions, with the company remaining on "dead 
center." 

Over the long run of the years ahead it seems very doubtful that the 
people will return to a negative concept of government's role in the economy. 
It is therefore hardly conceivable that they will long tolerate an arrange- 
ment whereby the most important instruments for guidance of the economy 
are independent commissions without close ties linking them to one another 
and to either the legislature or the executive. 

Lac\ of Stimulation. For independent commissions, whatever their 
advantages, the people pay a dear price in a number of ways. Many a 
regulatory commission is notably lacking in the vigor essential to advancing 
toward the goals the legislative and executive branches had in mind in 
adopting the basic statutes. As a recent federal board investigating the com- 
mission method of regulation observed, "A regulatory statute may be both 
wise and practicable, and yet be totally ineffective for the simple reason 



230 INDEPENDENT REGULATORY ESTABLISHMENTS 

that the agency takes no decisive action under it. ... An agency, in fact, 
possesses through this means a not inconsiderable power to thwart the legis- 
lative purpose. . . . An inactive agency will not lack apologists in any 
event; the difficulty is to find persons or groups able and in a position to 
apply a spur." 23 

In the states as well, many a utility commission, workmen's compensa- 
tion and industrial safety board, banking and insurance board, and profes- 
sional licensing board shows little evidence of a determined effort to define 
and achieve the public interest. Public utilities commissions, for example, 
most of them created because the people wanted forceful regulation of the 
intrenched railroad and electric power companies, have all too generally 
taken a negative attitude toward exercise of their power. 

The causes of such reluctance to act vigorously on behalf of the public 
are several. The most important are three: (a) general inertia, which 
can be indulged when there are no incentives to action and when action is 
bound to make enemies; (b) overemphasis on the judicial approach, spring- 
ing in part from the belief that commissions were made independent so 
that they could have much the same character and procedure as courts, 
and in part from the insistence of courts that due process of law requires 
court-like procedures in regulation; and (c) excessive exposure to the 
views and influence of the regulated interests, without compensating ex- 
posure to governmental and private views expressive of the public interest. 
While these features of unaggressive regulation are most common at the 
state level, they are discernible as well in such respected federal agencies 
as the Interstate Commerce Commission, 24 

5. ORGANIZATIONAL ALTERNATIVES 

To fit the independent regulatory commissions into the broad pattern 
of American government, several alternatives have been advanced. These 
alternatives are: (a) to integrate the commissions into the executive branch 
by clearly subordinating them to the chief executive; (b) to strengthen 
legislative control of the commissions; (c) to strengthen judicial review of 
the activities of independent commissions; and (d) to segregate the legis- 
lative, administrative, and judicial phases of each commission's work, so 
that each phase of work can be appropriately performed. The first three 
alternatives assume that commissions should be assigned to one of the main 
branches of government instead of remaining an unrecognized and headless 
fourth branch of government. The last alternative assumes that since 

23 Board of Investigation and Research, op. cit. above in note 5, pp. 16-17. 

24 For example, proposals to give the Interstate Commerce Commission jurisdiction over 
all forms of transportation, including air transport, have been rejected on the ground that the 
commission is too "railroad-minded," and could not take a broad enough view of the public 
interest in development of competitive methods of transportation. Congress did write the 
fundamentals of a general transportation policy into the Transportation Act of 1940, but it 
is an entirely different matter to expect an effective application of these fundamentals. 



INDEPENDENT REGULATORY ESTABLISHMENTS 231 

commissions perform a mixture of powers it would be unsound to sub- 
ordinate the commissions to any one branch of government; however, 
individual powers might be so subordinated or at least be exercised by 
distinct units of each commission. 

Executive Control. Integration under the chief executive's firm con- 
trol would facilitate coordination of policy and administration both among 
the commissions themselves and with the executive agencies. However, it 
would place the commissions in danger of more frequent shifts of policy 
resulting in proportionate instability for the business world. It would also 
clearly associate the commissions with whatever standards of political 
morality were observed by the chief executive necessarily a political man. 
Most important, it would place quasi-judicial functions requiring impar- 
tiality under the influence of the policy-minded chief executive. 

To some students, on the other hand, it is a fundamental error to re- 
gard the chief executive as a key formulator of policy, since constitutional 
emphasis is upon his executive functions that is, the execution of policies 
which are laid down by the policy-formulating branch of government, the 
legislative body. Under this view, the only advantage in integrating the 
commissions under the chief executive would be coordination of administra- 
tion; the disadvantage would be exposure of commission policy to execu< 
tive pressure. 

Legislative Control. If emphasis is placed upon the need for keeping 
the regulatory commissions from exercising a free and unguided hand on 
policy matters, and if the executive is ruled out as a key formulator of 
policy, the clear remedy is a strengthening of legislative oversight of the 
work of the commissions. Many advocates of integration under the chief 
executive would warmly embrace this legislative alternative if it offered 
any possibility of success. However, experience to date has not revealed 
that our legislative bodies are equipped to give the commissions the re- 
quired degree of supervision. 

Clearly, state legislatures meeting for a few months each year or bi- 
ennium are not organized for continuing superintendence of regulatory 
work. Congress is in a more favorable position. Nonetheless, after the 
most careful appraisal of past experience and future prospects for congres- 
sional control, Professor Cushman concludes that "Congress is likely to 
content itself with doing nothing for the most part in its dealings with the 
commissions, and with resorting to some form of drastic action when some- 
thing approaching a scandal crops up in connection with a commission." 26 

Recently we have seen evidence of a serious intention to strengthen the 
organization and procedure of Congress. Success of these efforts is to be 
hoped for, but it is unlikely that even after such improvement Congress 
will supervise the independent regulatory commissions with any greater 



2fi Cushman, of. at. nbovc in no^ 13, p 678. 



232 INDEPENDENT REGULATORY ESTABLISHMENTS 

effectiveness than it has shown in its relations with executive agencies 
having regulatory functions. 

Judicial Control. Increased judicial control of regulatory commissions 
would contribute little or nothing to the coordination of policy and ad- 
ministration. It could both assure faithful observance of judicial pro- 
cedure by the commissions and subject their decisions to the risk of being 
overruled if they failed to coincide with the legal and value judgments of 
the courts. On the procedural side, extension of judicial restrictions would 
mean a further formalization of commission procedure. On the substantive 
side, more thorough judicial review would call in each case for independent 
judicial reappraisal of the facts upon which the commission had based its 
decision. 

Although in some states there is still need for a tightening up of regu- 
latory procedures to make sure that private rights receive due consideration, 
in the federal government the need is much less obvious. While the Ameri- 
can Bar Association has pressed for severe legislative restrictions on regu- 
latory methods, the Attorney General's Committee on Administrative 
Procedure has looked in both directions at once. On the one hand, it has 
urged a centrally appointed group of impartial hearing commissioners; 
on the other, it has rejected more extreme measures, such as a uniform 
code of regulatory procedure and the abandonment of the informality of 
procedure now followed in the great majority of cases. In 1944, a report on 
the practices and procedures of the Interstate Commerce Commission cau- 
tioned that "the ways of the courts, if emulated too faithfully, can inhibit the 
Commission in the effective performance of its duties. The judicial influ- 
ence is by no means an unmixed blessing." 26 There is a measure of caution 
in this respect in the Administrative Procedure Act of 1946. 

For the courts to review not only the legal questions in a regulatory 
decision but also the weight of the evidence would reduce the prestige of 
regulatory bodies. It would supplant their presumably expert judgment of 
the facts of a case with the inexpert judgment of members of the judiciary. 
In practice the doctrines of court review have a certain flexibility. This the 
judges take advantage of in order to review more fully decisions of regu- 
latory bodies in which they lack confidence, while letting decisions of those 
having been found to possess integrity, expertness, and formal court-like pro- 
cedures escape severe judicial scrutiny. Furthermore, court attitude toward 
judicial review of decisions of regulatory agencies fluctuates to some extent 
with the variations in dominance of the courts by conservative and progres- 
sive judges. The former extend judicial review to both quasi-legislative and 

26 Board of Investigation and Research, op. cit. above in note 5, p. 68. The Board devoted 
a special section to the problem of reluctance of Interstate Commerce Commission personnel 
to take official notice of even noncontroversial legal and economic facts not put in the record 
by the parties to a hearing; it noted that in some instances Commission personnel even hold it 
improper to rely on earlier Commission decisions unless they arc introduced as evidence at 
the hearing a view that is contrary even to court practice. 



INDEPENDENT REGULATORY ESTABLISHMENTS 233 

administrative actions. The latter tend to contract the extent of judicial 
review on the grounds that the courts should not substitute their judgment 
for that of coordinate branches of government, save on clearly legal 
questions. 27 

Segregation of Powers of Independent Commissions. In effect, regu- 
latory commissions have lines of responsibility running to all three branches 
of government, as indeed have executive departments as well. The commis- 
sions are responsible to the courts for staying within their statutory powers, 
for following the lead of the courts in ruling on questions of law, and for 
applying a fair procedure in activities of a judicial character. The commis- 
sions are responsible to the legislative body for broad policies responsibility 
enforced through its power to amend the basic statutes and to determine 
how much money each agency may spend. The responsibility of the com- 
missions to the chief executive is the vaguest of the three and a matter of 
considerable dispute between him and the commissions. In two capacities 
the President appears to need greater control in administrative manage- 
ment and in policy coordination. It can be seen easily that the independent 
commissions and the executive departments are scarcely distinguishable in 
the matter of judicial and legislative lines of responsibility. The principal 
distinction is in the clarity of executive supervision of executive departments, 
as contrasted with the fuzziness of the chief executive's relations to inde- 
pendent commissions. 28 

In view of the difficulty of clearly placing independent commissions 
under one of the three branches of government, and also because of cer- 
tain sound objections to merging quasi-legislative, administrative, and quasi- 
judicial activities even within a commission, it has been proposed that some- 
how the several powers of each commission be segregated. The most fun- 
damental complaint is that prosecuting and judging should not be in the 
same hands. Yet a commission may decide what the statute means, investi- 
gate and formally charge a person with an alleged violation, and make 
up its mind whether the evidence presented by itself and the charged per- 
son calls for a decision that there was or was not a violation. Actually, each 
major commission is as an institution composed of hundreds of officials 
and employees. It is therefore possible to argue either that segregation 
should be absolute in the sense that the commission should not be respon- 
sible for both prosecuting and adjudicative functions; or that the usua) 
segregation of personnel into several units within the commission should 
suffice to keep the prosecutors distinct from those who do the judging, 
while at the same time common direction of both groups by the commis- 



27 For an excellent brief review of this general problem, see Pennock, Roland J., "Judicial 
Control of Administrative Decisions," Annals of the American Academy of Political and Social 
Science, 1942, Vol. 221, pp. 183-191. 

28 See Cushman, op. cit. above in note 13, p. 697 ff. 



234 INDEPENDENT REGULATORY ESTABLISHMENTS 

sion would provide a reasonably consistent pattern of regulation. 29 
In addition to the attempt to ensure impartiality in adjudication by 
commissions, there is another motive for segregation. This is the desire 
clearly to subordinate to the chief executive's control at least part of the 
work now done by the independent commissions. Of course, the primary 
argument against executive control of the commissions is that such control 
might destroy impartiality in the performance of judicial functions. The 
advocates of executive control therefore have hit upon the expedient of 
setting up, for each area now regulated by commissions, one body to hear 
and decide impartially disputes of a judicial character, and another to per- 
form all responsibilities of a policy-formulating and administrative charac- 
ter including the prosecution function now vested in the commissions. 
This proposal gained particular prominence when advanced by the Presi- 
dent's Committee on Administrative Management in 1937. 

Proposals of President's Committee on Administrative Management. 
The President's Committee suggested experimentation with a segregation 
along specific lines. Each commission would retain its judicial functions 
under the present guarantees of independence. For purely administrative 
purposes, however, it would be attached to one of the executive departments. 
All of its functions not of a judicial character would be placed under the 
control of the department head. The arrangement would safeguard impar- 
tiality in the exercise of functions of a judicial nature. At the same time, 
it would bring under executive control those policy-formulating functions 
and management functions that properly fall within the President's area 
of responsibility. Moreover, by placing the prosecuting function under 
executive control, it would be separated clearly from the judicial function. 30 
This solution has not appealed to Congress 31 nor to the commissions 
themselves. The Attorney General's Committee on Administrative Proce- 
dure opposed such complete segregation on three grounds. One was that 
the consequence of multiplication of governmental units in identical fields 
was objectionable. The second was that two agency units in the same field 
would lead to friction, inconsistency of action, and a breakdown of respon- 
sibility. The third asserted that since such biases as do exist on the part 
of regulatory agencies "are mainly the product of many factors of mind 
and experience, and have comparatively little relation to the administrative 
machinery," complete severance of the judicial phases of regulatory work 

29 On this issue of total vs. internal segregation, see the Attorney General's Committee on 
Administrative Procedure, op. at. above note 4, pp. 55-60, and 203-209. 

80 President's Committee on Administrative Management, Report with Special Studies, pp. 
39-42, Washington: Government Printing Office, 1937. 

81 In delegating to the President authority to reorganize the executive branch, Congress 
in the Reorganization Act of 1939 specifically excepted the independent commissions from his 
authority. The Reorganization Act of 1945 generally followed this precedent. 



INDEPENDENT REGULATORY ESTABLISHMENTS 235 

from its other phases would not be warranted. 82 Consequently the Attorney 
General's Committee recommended internal segregation among each com- 
mission's personnel to keep distinct the judicial activity from the prosecuting, 
policy-formulating, and administrative work, primarily through centrally 
appointed hearing officers to perform most of the judicial tasks. This is 
the general line taken by the Administrative Procedure Act of 1946. 

Arrangements like these fail, of course, to give the chief executive the de- 
sired control over nonjudicial activities of the commissions. Moreover, in the 
field of public utilities there has been a general feeling that legislative, execu- 
tive, and judicial functions of each commission "are so intertwined . . . that 
attempts to separate and segregate them will be in all probability considerably 
more destructive than constructive." 33 At the state level the additional 
point is made that many state regulatory commissions have such small staffs 
sometimes less than five or ten employees that segregation is beyond 
practical consideration. 

It is not likely that any mass reorganization of federal and state regu- 
latory commissions will occur in the near future. However, though there 
is disagreement on the remedy, it is an important advance if the commis- 
sions have come under sufficiently close examination for citizens to recognize 
several fundamental factors. First, the quality of men and women appointed 
to the commissions is more important than the details of organization. 
Second, judicial work should be carried on in an impartial manner, free 
of the bias characteristic of the prosecution function. Third, coordination 
of policy formulation and administrative management among government 
agencies is essential, especially during periods when government plays a 
positive role in the economy. The chief executive appears to be the only 
responsible and effective focus for such coordination. And fourth, independ- 
ent commissions should be subject to the same control by the legislative 
and judicial branches that applies to all other regulatory and service agencies 
of government. 

^Attorney General's Committee on Administrative Procedure, op. cit. above in note 4, 
pp. 55-60. Three members of the committee argued that internal segregation was not suffi- 
cient. ,md in effect endorsed the President's Committee's proposal. Ibid., pp. 203-209. 

83 Board of Investigation and Research, op. cit. above in note 5, 124 ff., referring 
specifically to the Interstate Commerce Commission. See also National Association of Railroad 
and Utilities Commissioners, Report of the Committee on Progress in Public Utility Regulation, 
1938. 



CHAPTER 



Government Corporations 

1. CENTRAL CONTROLS AND MANAGERIAL FREEDOM 

Direction by the Chief Executive. A persistent, if not the predominant, 
problem in the design of governmental structure is the determination of the 
relationship of the agencies of administration to the organs of popular con- 
trolthe elected chief executives and legislatures. The general trend in 
recent decades has been to restrict the independence of administrative de- 
partments by subjecting them to the direction of the chief executive. How- 
ever, for the functions performed by independent regulatory boards and 
commissions the achievement of public purpose has been thought to require 
immunity from his control. The government corporation, in its status in the 
general institutional framework, represents still another type of organiza- 
tion. While it is usually subject to much more control by the chief execu- 
tive and the legislature over its general policy than the independent com- 
mission, it enjoys far greater freedom than the ordinary department in the 
choice of means to achieve its objectives. 

In the process of making administrative agencies accountable to the 
chief executive, ordinary departments have come to be hedged about by 
many limitations on their freedom of action. Some of these limitations 
on departmental autonomy concern the substance of what is being done. 
The chief executive wants to move in one direction rather than another. 
He desires to wait for a more propitious time before a department inaugu- 
rates a program. He prefers this program emphasis or that. Such controls 
of policy are essential to direction. They are the means by which the chief 
executive fulfills his broad political responsibility. 

Overhead Control of Departmental Methods. The process of administra- 
tive consolidation has brought still another type of overhead control, which 
is directed primarily toward the means or methods of achieving substantive 
objectives. The department is not only told by higher authority what to do, 
but it is also bound by more or less detailed instructions on how to do the 
job. Budget, personnel, accounting, and legal officials on the government- 

236 



GOVERNMENT CORPORATIONS 237 

wide level make it their business to see that these instructions are formu- 
lated and followed. 

Integration of the administrative structure makes possible more detailed 
and more effective control by the legislature. In the federal government, for 
instance, a well-prepared executive budget which presents information on 
which Congress can act is a foundation for congressional control. An effec- 
tive central personnel agency strengthens Congress. For example, Congress 
can fix salary scales and the Civil Service Commission will see that they 
are followed. The Comptroller General, legally an agent of Congress, will 
see that legislation prescribing the manner of expenditure of funds is 
carried out to the letter. 

Control Machinery in Action. The thoroughness with which legislative 
enactments can be applied throughout the vast administrative structure is 
marvelous and awesome. In a more primitive administrative era the rule 
books might be filled with regulations, but they would hamper no one as 
long as they could be ignored or not as the official saw fit. Modern admin- 
istrative techniques alter the situation If Congress should abruptly decide 
that, beginning with the next fiscal year, no red-haired person was to be 
employed in the federal service, a complex and far-flung administrative 
process would be set in motion. 

The Civil Service Commission would assemble the experts to advise it 
in the promulgation of regulations defining "red" hair. It would exclude 
all people within the definition from its future examinations. It would 
lay down rules for the departments. To make certain that the act of Con- 
gress was carried out, it might prescribe that no color-blind person could 
be a personnel officer. The Bureau of the Budget would inquire of the 
departments what steps were being taken to avoid the expenditure of funds 
for the prohibited purpose. 

Each department head would issue stern orders to his personnel offices. 
Instructions including detailed procedures for the application of the law 
would flow to the bureau chiefs, the division chiefs, and the section chiefs. 
From Washington, these orders would go to the federal field establishments 
the regional, state, and local offices. The regulation would find its way 
to outposts of the national government in Alaska, India, and Afghanistan. 
It would filter down the administrative hierarchy to the lowliest and most 
remote office. The Comptroller General would require an affidavit from 
each employee that he or she did not have red hair probably accompanied 
by a photograph in color, attested to be a true likeness of the affiant by two 
disinterested persons! The Attorney General would be asked to rule on the 
applicability of the law to a completely bald person who once had red hair; 
and the holding of the Attorney General might be contrary to that of the 
Comptroller General. 

The Federal Bureau of Investigation would put samples of hair through 
the laboratory to detect evidences of dye. The courts would be called upon 



238 GOVERNMENT CORPORATIONS 

to decide whether the law applied to employees of state governments paid 
in part from federal grants. The Department of State, for the good of the 
service, would seek from Congress an exception from the law for its locally 
hired employees in Eire. Congressional committees would be petitioned by 
discharged persons insisting that their hair was titian and not red as the 
Comptroller General had held and demanding special legislation author- 
izing their employment. 

The example is fanciful but its essence could be duplicated a hundred 
times. Derived from such controls over methods are- the cherished maxims 
of our political folklore to the etffect that government departments are stifled 
by red tape, paralyzed by intricate procedures, hindered by adherence to 
precedent, and bound by absurd rules and regulations. Corollary beliefs 
are that departments are ill fitted to undertake functions requiring speedy 
action, rapid adaptation to new conditions, inventiveness, and the exercise 
of judgment unfettered by petty rules. These notions abound most luxu- 
riantly in newspaper editorials, campaign speeches, and kindred sources, and 
in some degree they possess an undeniable validity. 

Central Control and Departmental Resourcefulness. A government de- 
partment must follow elaborate procedures in estimating its future financial 
needs and in obtaining appropriations from Congress. It enjoys no assur- 
ance of continuity in its programs, for once a year it must seek funds from 
a Congress that is sometimes friendly and sometimes inexplicably capri- 
cious. It must hire its employees subject to intricate procedures and regu- 
lations fixed by the Civil Service Commission. In spending money it must 
take care lest it violate the voluminous jurisprudence on the subject as inter- 
preted by the Comptroller General. All these controls arise to* meet demon- 
strated needs. If some such controls were not in existence, they would have 
U> be invented. Yet there is a continuing necessity for adjusting their form 
to reconcile the demands of administrative integration with the conditions 
requisite for creative management. 

In part because of the controls applicable to the operations of ordinary 
departments and in part because of other reasons, the government corpora- 
tion is commonly regarded as a means by which the body politic can 
conduct commercial activities under administrative arrangements approxi- 
mating those of private enterprise. In a frequently quoted passage, British 
Laborite Herbert Morrison has argued for the use of the corporation in the 
management of publicly-owned commercial enterprise because such an un- 
dertaking "should be able with speed and decision to adapt itself to the 
changing needs of the modern world." Such characteristics are not with- 
out merit in the ordinary department, but they are indispensable in a com- 
mercial enterprise if it is to survive. 

Changing Role of Government Corporations. A "pure" form of gov- 
ernment corporation would be one in which government owned all or the 
majority of the stock of an incorporated enterprise. Government, like a 



GOVERNMENT CORPORATIONS 239 

private stockholder, would look to the managers for the efficient conduct 
of the enterprise and would measure performance by the volume of divi- 
dends and the state of the balance sheet. It would leave to the officers of 
the corporation the tasks of management: the methods of personnel selec- 
tion; the rules for purchasing supplies; the terms on which sales would be 
made; the disposition of revenues and profits; and so forth. For example, 
if the federal government should purchase fifty-one per cent of the stock 
of the American Telephone & Telegraph Company, it could receive its 
dividends, observe the general results of operation, and, if dissatisfied, use 
its majority stock control to replace the management. In practice, however, 
governmental use of the corporate device for the conduct of pure commer- 
cial enterprise is exceptional. It is used largely for functions in the no 
man's land between ordinary governmental functions and commercial 
activities. 1 

Although the federal government has owned and operated corporations 
which approximated the "pure" type in their autonomy and in their form, 
government corporations have gradually lost most of the characteristics of 
the private corporation and have become more and more like ordinary 
administrative departments. This trend toward the assimilation of corpora- 
tions into the regular governmental pattern moved a step further with the 
passage of the Government Corporation Control Act of 1945. Even under 
that act, corporations retained a degree of autonomy not uniformly enjoyed 
by departments. The discussion which follows must of necessity be in con- 
siderable measure an historical analysis indicating the process by which 
government corporations reached the stage of development marked by 
this federal statute. 

1 Of some importance is the means of formation of government corporations. In some 
instances they are formed by federal officials proceeding under state laws in the same manner 
as private incorporators. Such action is, of course, taken in pursuance of some sort of authori- 
zation by federal law. In other instances government corporations are created specifically by 
.icts of Congress. In a third type of situation the corporation may be formed by federal officials 
acting as "incorporators" under general or specific authorization by Congress. In a few 
instances private corporations have become "government" corporations by public acquisition of 
their capital stock. 

As to the federal government, there has been considerable discussion looking toward the 
enactment of a statute providing a uniform method for the formation of corporations together 
with a degree of uniformity of corporate rights and responsibilities. The lack of such a statute 
has made difficult congressional control over the creation of corporations; some existing cor- 
porations were originally pegged on statutory clauses which doubdess were enacted without 
expectation that they would be so used. Past practice in chartering corporations also created 
some difficulty in controlling the scope of corporate activity. The Government Corporation 
Control Act (Public Law No. 248, 79th Cong., approved Dec. 6, 1945) prohibits the organiza- 
tion or acquisition of any government corporation "for the purpose of acting as an agency or 
instrumentality of the United States, except by Act of Congress or pursuant to an Act of 
Congress specifically authorizing such action." The same act requires the liquidation by June 
30, 1948, of all wholly government-owned corporations formed under laws of the states or 
the District of Columbia, unless reincorporated by act of Congress prior to that date. 



240 GOVERNMENT CORPORATIONS 

2. THE DEVELOPMENT OF THE CORPORATE SYSTEM IN GOVERNMENT 

Variety of Government Corporations. Rationalizations for the use of the 
government corporation have been erected on the assumption that it should 
be resorted to primarily for the administration of self-sustaining commercial 
undertakings. Only when such a function is performed can there be a 
source of funds for operation other than appropriations. Only with such 
non-tax revenues is it feasible for long to grant autonomy in internal man- 
agement of the affairs of the undertaking, since nearly all the controls 
applicable to the ordinary department stem from the fact of expenditure 
from the public treasury. However, in many instances government corpora- 
tions have been charged with functions of a noncommercial or quasi- 
commercial character more akin to those of an old-line department than to 
those of a business enterprise. 

Consequently, in the United States government corporations are of 
"somewhat limited value" in illustrating their use as a means of managing 
publicly owned commercial enterprises. 2 Partly because of the nature of 
the functions imposed upon them, government corporations have also ac- 
quired, through congressional and executive action, a great diversity of 
form. It is thus misleading to speak of "the" government corporation. No 
uniformity of powers or of form is apparent; about all that government 
corporations have in common is the name. This diversification has been 
carried so far that a leading student of the subject has concluded that "the 
government corporation as a concept as a definite and specialized form of 
administrative organization is rapidly ceasing to exist." 3 Nevertheless, 
the agencies that masquerade under the title of corporation differ in many 
respects from the ordinary departments. 

The nature and form of individual corporations have been determined 
by a variety of factors. The ideas prevailing at the time are reflected in 
corporations formed in different periods. The kind of function performed 
has been of some importance, for those corporations that conduct more 
truly commercial activities seem to have maintained a higher degree of 
corporate autonomy. The political strength of their constituencies has a 
bearing on the form of many corporations. Thus, by virtue of its popular 
support, the Tennessee Valley Authority has been able to resist proposals 
to convert it into something more nearly approximating a regular depart- 
ment. A considerable number of corporations, usually some time after 
their establishment, have felt the pressure of Congress to force them into 
the mold of an ordinary department. 

2 Thurston, John, Government Proprietary Corporations in the English-Speaking Countries, 
p. 6, Cambridge: Harvard University Press, 1937. 

3 Pritchctt, C. H., "The Paradox of the Government Corporation," Public Administration 
Review, 1941, Vol. 1, p. 381. 



GOVERNMENT CORPORATIONS 24l 

Government Corporations as Products of Emergencies. Most govern- 
ment corporations have been products of emergency conditions, although 
their life does not always end with the emergency which gave them birth. 
In war and depression the federal government has been compelled to under- 
take activities of an extraordinary character. Pressure for speedy action 
made the corporate form with its freedom from cumbersome procedures 
attractive. However, the oldest existing government corporationthe Pan- 
ama Railroad Company came into government ownership under different 
circumstances. In 1903, the United States acquired the French interest in 
the canal and in the railroad company which had been incorporated under 
the laws of New York in 1849. The federal government has continued to 
operate the company under its original charter. In addition to tht railroad, 
the company operates hotels, commissaries, steamships, dairies, laundries, and 
other enterprises. It is administered under the War Department in close 
affiliation with the Canal Zone. Partially because of its monopolistic posi- 
tion, it has been a profitable enterprise. 4 The Inland Waterways Corpora- 
tion, formed in 1924, is another instance in which emergency conditions did 
not govern the choice of administrative form. 5 The corporate arrangement 
was deliberately chosen because of its advantages over the then existing 
departmental structure. The corporation operates the Federal Barge Lines 
which in 1943 had a gross operating revenue of $8.3 millions. 

With these exceptions, and the further exception of the Federal Land 
Banks which were authorized in 1916 after long inquiry into the problem 
of agricultural credit, the federal corporate system has been a creature of 
war and depression. The first large-scale use of corporations occurred in 
World War I, when such bodies included the United States Housing Cor- 
poration, the United States Grain Corporation, the War Finance Corpora- 
tion, the Emergency Fleet Corporation, and the United States Spruce Pro- 
duction Corporation. Experience gained at that time brought a recogni- 
tion of the potentialities of the corporation and furnished precedents for 
subsequent action. 6 

Great Depression and World War II. The Great Depression was a 
second occasion for the creation of a considerable number of corporations. 
The Reconstruction Finance Corporation was formed in 1932 in an attempt 
to stave off economic disaster by loans to business banks, insurance com- 

4 See Dimock, Marshall ., Government-Operated Enterprises in the Panama Canal Zone, 
Chicago: University of Chicago Press, 1934. Much of our knowledge of the government corpor- 
ation has been made available by Professor Dimock through his own writings and studies by his 
students. 

5 See Dimock, Marshall E., Developing America's Waterways, Chicago: University of 
Chicago Press, 1935. 

6 See Van Dorn. Harold, Government-Owned Corporations, New York: Knopf, 1926. 



242 GOVERNMENT CORPORATIONS 

panics, railroads, and other types of enterprise. 7 The functions of the cor- 
poration were broadened after its establishment, and through the spawning 
of subsidiaries it eventually became a huge holding company. The Home 
Owners Loan Corporation was another type of emergency credit agency. 
Created in 1933, it had the function of refinancing home mortgages threat- 
ened with foreclosure. By the end of its lending operations in 1936 it had 
refinanced over $3 billions in home mortgages. It continues to exist, ful- 
filling the functions of collecting its mortgages and managing the prop- 
erties acquired in its operations. Another variety of emergency corporation 
was the Federal Surplus Commodities Corporation, which was chartered in 
1933 for the purpose of buying agricultural surpluses and of distributing 
them to relief agencies hardly a profit-making enterprise but one involving 
large purchasing operations which could be carried on more handily under 
corporate arrangements. 

The Tennessee Valley Authority, though a permanent institution, was 
also of depression origin. It was created in 1933 with functions of a mixed 
governmental and commercial nature, and it is notable both for its cor- 
porate form and as an experiment in multiple-purpose regional administra- 
tion. The Federal Deposit Insurance Corporation, another permanent 
agency of emergency origin, was charged with the insurance of bank depos- 
its of less than $5,000, a risk too great to be carried by private enterprise 
and difficult of assumption save through compulsory coverage on a large 
scale. The Federal Savings and Loan Insurance Corporation (1934) had a 
similar objective in the protection of investments in savings and loan insti- 
tutions. Federal Prison Industries, Inc. (1934) involved the incorporation of 
an existing activity, a move perhaps influenced by the frequent resort to use 
of the corporate device in other activities at the time. The corporation sells 
to government departments, which are obliged to buy from it, and employs 
workers who have no alternative market for their labor. It makes money. 
Other corporations created in the early 1930's included the Commodity 
Credit Corporation (1933), the Federal Farm Mortgage Corporation (1934), 
the Mortgage Corporation (1935) under the Reconstruction Finance Cor- 
poration, and the Federal Home Loan Banks (1932). 

World War II brought another spurt in corporate activity with the 
creation of a number of corporations, principally as subsidiaries of the 
Reconstruction Finance Corporation, to carry on war activities which are 
notoriously of a risky character. The Defense Homes Corporation (1940) 

7 See Senate Doc. No. 172, 76th Cong., 3d Sess., Pt. 1, pp. 50-52, 1940. This document 
Consists of a report prepared by the Treasury Department in response to a Senate request; it 
contains detailed information on each of the corporations in existence at the time. For a 
more recent and much briefer description, see Joint Committee on Reduction of Non-Essential 
Expenditures, Government Corporations, Senate Doc. No. 227, 78th Cong., 2d Sess. A more 
comprehensive description of each corporation is to be found in Reference Manual of Govern- 
went Corporations, prepared by the General Accounting Office and printed as Senate Doc. No. 
*6, 79th Cong., 1st Sess., 1945. 



GOVERNMENT CORPORATIONS 243 

was organized to construct homes in areas congested by defense activity. 
The Defense Plant Corporation (1940) was created to finance and construct 
plants for war production; it became the owner of billions in plants and 
machinery. The Defense Supplies Corporation (1940) and the Metals 
Reserve Company (1940) were established to buy and sell strategic and 
critical materials. The Rubber Development Corporation (1940) was given 
the job of developing and procuring natural rubber abroad, principally in 
Latin America, while the Rubber Reserve Company (1940) was formed to 
construct synthetic rubber plants. The United States Commercial Company 
(1942), another Reconstruction Finance Corporation subsidiary, was char- 
tered to engage chiefly in preclusive buying abroad that is, buying critical 
materials regardless of price to prevent their falling into the hands of the 
enemy. 8 

In 1945, several of the defense subsidiaries of the Reconstruction Finance 
Corporation were merged with the parent company and lost their separate 
identity. Those affected by Public Law No. 109, approved June 30, 1945, 
were: Defense Plant Corporation, Metals Reserve Company, Rubber Reserve 
Company, Defense Supplies Corporation, and Disaster Loan Corporation. 
The Coordinator of Inter-American Affairs formed several corporations to be 
used as instrumentalities in the promotion of the Good Neighbor Policy. 
They were the Institute of Inter-American Affairs, the Institute of Inter- 
American Transportation, the Inter-American Educational Foundation, Inc., 
the Inter-American Navigation Corporation, and Prencinradio, Inc. 

Government Corporations in the Field of Farm Credit. The corporation 
has been the characteristic administrative form in the elaborate governmental 
system for farm credit which has grown steadily since 1916. The twelve 
Federal Land Banks, organized in 1917 under the Federal Farm Loan Act 
of 1916, are mixed in ownership, with part of the stock being owned by 
the federal government and part by national farm loan associations that 
is, borrowers' cooperatives. The Federal Land Banks have revolutionized 
long-term farm mortgage lending practices; their outstanding loans at the 
end of 1943 totalled $13 billions. 

The credit system was broadened in 1923 with the creation of twelve Fed- 
eral Intermediate Credit Banks which make loans and discounts for lending 
institutions engaged in short-term financing of farm production; their loans 
and discounts in 1943 were about $1 billion. The twelve Production Credit 
Corporations, set up in 1933, organize and finance local production credit 
associations which in turn make short-term loans to farmers. In theory, 
these local associations are credit cooperatives with some of their capital 
subscribed by the Production Credit Corporations. All these financing 

*See Gordon, David, "How We Blockaded Germany," Harper's Magaxine, December, 
1944, Vol. 190, pp. 14-22. 



244 GOVERNMENT CORPORATIONS 

institutions and certain others have been under the supervision of the Farm 
Credit Administration. 

Scope of Corporate System. The net effect of the development of the 
corporate system was that by 1944 there were in existence in the neighbor- 
hood of one hundred government corporations, the precise number varying 
with idiosyncracies in definition. In the aggregate the corporations in the 
fiscal year of 1944 spent $58.8 millions for administrative expense and $303.3 
millions for nonadministrative expense. They used $8.68 billions for the 
purchase and improvement of property, principally war plants and supplies, 
and loaned $1.02 billions. These same agencies, from their inception to the 
end of 1944, had spent $18.9 billions for the purchase and improvement of 
property and had loaned $202 billions. 9 

3. OVERHEAD CONTROL OF CORPORATE OPERATIONS 

Immunity from the Power of the Purse. The ordinary government 
department is subject to overhead controls applied by the Bureau of the 
Budget, the Department of Justice, the Comptroller General, and the Civil 
Service Commission. Through decades of evolution these controls and 
procedures have become, as David E. Lilienthal has said, "stupefying" in 
their complexity. 10 Although such limitations on departmental action are by 
no means without utility, they often delay operation: they limit departments 
in the choice of means to achieve ends; they sometimes smother initiative; 
and too often they become pointless ritual. Long experience has demon- 
strated the need for limits on officials who spend other people's money. 
However, in some types of governmental undertakings, reliance on the 
traditional prescriptions rather than on alternative methods of measuring 
performance makes it difficult to accomplish the job assigned to an agency; 

Administratively, the most significant privilege enjoyed by a full-fledged 
government corporation is its freedom from the customary rules about 
finance. These rules stem from the great constitutional principle that no 
money may be paid from the Treasury except in pursuance of law. The 
principle lays the basis for control by the executive and legislative branches 
over the administrative agencies. The power of the purse is used to deter- 
mine the amounts to be spent for each of the purposes of government. It 
is also used to prescribe in greater or lesser detail precisely how the money 
shall be spent. 

Another principle a necessary corollary of the first is that public 
revenues shall be deposited in the Treasury. Without adherence to this 
maxim, public moneys might be spent directly from revenue without specific 
appropriation by the legislature. A third fundamental principle is that of 
annual appropriations. Invariable adherence to it has not been achieved. A 

9 Treasury Department, Bulletin, pp. 66-68, Sept., 1944. The figures are from tables under 
the heading, "Certain Government Corporations and Credit Agencies." 

10 TVA Democracy on the March, p. 168, New York: Harper, 1944. 



GOVERNMENT CORPORATIONS 245 

few permanent appropriations that is, standing authorizations for the ex- 
penditure of specified amounts each year remain on the books. Yet annual 
appropriation is the general practice in the federal government. This is of 
profound importance. It means that the power of the purse is exerted at 
annual intervals. The burden of proof and pressure is annually placed upon 
those who desire money. 

The government corporation furnishes a method of modifying these 
principles. A subscription by government to the capital stock of a corpora- 
tion or an allocation of funds to the corporation removes the money from 
the Treasury and from annual appropriation control. The funds may be 
utilized until exhausted whether it takes one year or ten. Earnings of the 
corporation, since they may be corporate funds rather than public revenues, 
need not be covered into the Treasury but may be retained in the custody 
of the corporation. They may then be spent at the discretion of the officers 
of the corporation, though only within the limits of corporate purposes 
fixed by the charter. If the corporation is engaged in a self-sustaining func- 
tion, its revenues would enable it to operate on its own resources more or 
less indefinitely without annual subjection to the presidential and congres- 
sional power of the purse. 

It is usually pointed out that in the avoidance of customary regulations 
about expenditure a superior type of control becomes possible. If a revenue- 
producing function is involved, analysis of the financial operations by ordi- 
nary methods applied by private corporations will furnish a means of 
evaluating performance. Is the enterprise coming out even or is it yielding 
a return on the government's investment? Thus the Tennessee Valley 
Authority attempts to indicate in its financial reports the degree to which 
its power operations are paying their way. This can be contrasted with the 
Post Office accounting in which a profit may be claimed while no charges 
are made for capital, depreciation, or other factors which are weighed in 
business accounting. 

Fiscal freedom makes the measurement of performance feasible. How- 
ever, probably of greater importance in the case made for corporate 
autonomy are certain characteristics of the appropriation procedure for 
ordinary departments. It is very difficult to forecast specifically the financial 
requirements of a commercial enterprise. If business is unexpectedly good, 
the increased revenues must be available to meet the increased operating 
charges. Moreover, application of the usual appropriation procedures to 
commercial enterprises is made less practicable by the length of the appro- 
priation cycle. An ordinary department must anticipate its financial needs 
long in advance of actual expenditure. Thus each summer a department 
must begin the preparation of its expenditure estimates to cover the fiscal 
year that will end on June 30 two years later. It must ordinarily present 
its estimates for review by the Bureau of the Budget about September of 
the year preceding the beginning of the fiscal year covered by the estimates 



246 GOVERNMENT CORPORATIONS 

It will subsequently justify the estimates as approved by the President to 
congressional committees, and final action will be taken by Congress shortly 
before the beginning of the fiscal year. 

The difficulties of forecasting revenues and expenditures of commercial 
enterprise are illustrated by an experience of the Tennessee Valley Au- 
thority. Estimates of power revenues and expenses of power production 
prepared in the summer of 1939 for the fiscal year ending June 30, 1941, 
were: revenues, $14.7 millions; direct power expenses, $5.6 millions. In 
fact, however, revenues turned out to be $21 millions and expenses about 
$9 millions. 11 Under ordinary budget procedure, TVA would have had to 
go back to Congress for additional appropriations to meet the unforeseen 
conditions. Under corporate practice, the increased revenues were avail- 
able without congressional action to meet the increased expenses. 

Another example is furnished by the Federal Deposit Insurance Corpo- 
ration. Its revenues consist of assessments on the deposits of insured banks, 
together with the earnings of investments of the capital and surplus of 
the corporation. The losses paid to depositors in closed banks have fluctu- 
ated violently over the years. Deposit insurance losses and expenses have 
ranged from a low of $1.3 millions in 1942 to a high of $14.0 millions in 
1939. The corporation attempts to pay depositors as soon as possible after 
a bank is closed the next day if practicable. Any attempt to estimate 
losses and provide for them by appropriations would be doomed to failure 
unless the appropriations were coupled with authority virtually approxi- 
mating the present range of discretion of the corporation. 

Freedom to plan and make expenditures within the limits of funds 
available is important because of the difficulties of forecasting. Equally 
important is the fact that such freedom gives the corporate officials greater 
discretion in determining how the corporation is to be managed. If the 
expenditure program must go through the Bureau of the Budget and the 
Appropriations Committees of Congress, the corporate determinations of 
how the funds are best to be expended will almost certainly be questioned. 
The judgment of the Bureau of the Budget, acting for the President, and 
the opinion of the congressional committees may be substituted for con- 
clusions of those responsible for the management of the corporation. By 
this limitation of their discretion, corporate managers assert, their power 
ceases to be commensurate with their responsibility for the management 
of the affairs of the corporation. 

Restrictions on Corporate Autonomy. Such are the considerations urged 
in support of fiscal autonomy for government corporations. In practice, 
corporate autonomy in the disposition of revenues has been sharply re- 
duced. The Government Corporation Control Act of 1945 subjected all 
corporations wholly owned by the federal government to a uniform type 

11 Finer, Herman, The TVA: Lessons for International Application, p. 189, Montreal: 
International Labour Office, 1944. 



GOVERNMENT CORPORATIONS 24? 

of budgetary control, which we shall describe shortly. Even before the 
adoption of this law, successive actions by the President and Congress had 
narrowed corporate autonomy in the determination of expenditure pro- 
grams. These actions left only the Inland Waterways Corporation, the 
Panama Railroad Company, and certain agricultural credit corporations 
of mixed ownership in full enjoyment of the power to adopt operating 
programs for the expenditure of their revenues. 

From its establishment in 1924, the Inland Waterways Corporation had 
not had to seek annual appropriations for operating expenses. Revenues 
from the operation of the Federal Barge Line and other sources were spent 
for the conduct of the business in the discretion of the corporate manage- 
ment. The corporation did not have to estimate long in advance how many 
workers it would need to man its transport facilities, justify these estimates 
to the Bureau of the Budget and to congressional committees, and operate 
within the limits of a congressional appropriation. Rather, it paid its 
expenses of operation from its revenues after the fashion of a private cor- 
poration. Similarly, and for a much longer period of time, the Panama 
Railroad enjoyed the privilege of managing its affairs within the limits 
of its resources. 

Prior to 1945, the general tendency had been toward greater control by 
overhead executive agencies and by Congress over the financial program- 
ming of corporations. In some instances this trend was attributable to 
the fact that the corporation did not possess funds, either from its own 
earnings or from other sources, adequate to meet its needs; it thus had 
to seek appropriations to finance its operations. In these situations the 
theory of corporate freedom was never completely applied. It was perhaps 
equally important in the extension of budgetary and appropriation control 
that central budget officials and the Appropriations Committees were on the 
whole ill disposed toward arrangements diverging from those applicable 
to government operations generally. 

In the development of appropriation control, the first step was the in- 
troduction of the requirement that corporations with funds available 
for expenditure without annual appropriation, obtain approval by the 
Bureau of the Budget of expenditures for "administrative expenses," a 
category of expenditure somewhat difficult to define. On August 5, 1935, 
the President directed that the Federal Savings and Loan Insurance Cor- 
poration, the Home Owners Loan Corporation, and the Federal Farm 
Mortgage Corporation submit annually to the Bureau of the Budget esti- 
mates of funds needed for administrative expenses, and that they incur 
obligations only within the limits approved by the budget director. 12 
Shortly afterwards, the same rule was applied to the Federal Deposit In- 
surance Corporation, the Export-Import Bank, the Reconstruction Finance 

12 Executive Order No. 7126 of August 5, 1935. This order also applied to several non- 
corporate federal agencies which were at the time outside the usual appropriation procedure. 



248 GOVERNMENT CORPORATIONS 

Corporation, and the Electric Home and Farm Authority. 13 Next, the 
Tennessee Valley Authority was added to the list. In 1942, the require- 
ments were extended to all major corporations until then outside the rule. 14 

The next step in the evolution of overhead control of government cor- 
porations was the introduction of congressional review of administrative 
expenses. The First Deficiency Appropriation Act of 1936 listed nine 
larger corporations which, beginning with the next fiscal year, were pro- 
hibited from incurring any administrative expenses "except pursuant to 
an annual appropriation specifically therefor . . . ," 15 This provision would 
have resulted in expenditures being made from the Treasury rather than 
from corporate funds. That in turn would have brought such adminis- 
trative expenditures within the purview of the Comptroller General and 
would have made them subject to all the general rules and regulations 
applicable to departments. However, the law of 1936 was modified in 
subsequent appropriation acts. Congressional action took the form of a 
limitation on the amount of corporate funds which might be spent for 
administrative purposes, rather than of an appropriation from the Treas- 
ury. Thus the language of one pertinent appropriation act for 1945 reads: 
"Not to exceed $11,500,000 of the funds of the Reconstruction Finance 
Corporation, established by the Act of January 22, 1932 (47 Stat. 5), shall 
be available during the fiscal year 1945 for its administrative expenses . . . ." 
By this means, Congress limited the amount which might be spent for 
administrative purposes but did not bring the expenditure under the control 
of legislation and regulations governing ordinary departments. 

Whether or not the original laws governing a corporation should be 
changed to bring administrative expenses under annual congressional re- 
view seems to have been determined largely by chance rather than by prin- 
ciple. In some instances, the action taken resulted clearly from the lack 
of legislative confidence in a particular individual. In other instances, the 
initiative came from the corporation, motivated by the consideration that 
it might be better off under a limitation suggested by itself than it would 
be under more drastic action initiated by Congress. 16 

Subjection of "administrative expenses" to congressional limitation was 
not necessarily onerous. It left the corporation autonomous in the greater 
part of its fiscal operations. A lending corporation, for example, might 
loan, collect, and reloan its funds without congressional limitation on the 

13 Executive Order No. 7150 of August 19, 1935. 

** Executive Order No. 9159 of May 11, 1942. 

M 49 Stat. 1648. 

16 The 1946 budget contemplated that congressional limitation would be placed on addi- 
tional corporations. The Chairman of the Board of the Federal Deposit Insurance Corporation 
said to the House Appropriations Committee: "This year, to comply with the growing senti- 
ment among congressional leaders that Congress should pass upon administrative expenses of 
Government corporations, we voluntarily submitted our annual budget for such expenses for 
congressional approval." 



GOVERNMENT CORPORATIONS 249 

total scale of lending operations save such limitation as was imposed by 
the amount of capital available to the corporation. Congress limited only 
the "administrative" expenses. Moreover, the ingenious concept of "non- 
administrative expenses" and their exclusion from congressional control 
permitted corporate flexibility in the determination of the amounts spent 
for certain purposes which in lay language might be called administrative. 
The differentiation between administrative and nonadministrative expense 
was not sharp. Generally, continuing overhead costs were included in the 
administrative category while expenses arising directly in the management, 
protection, and care of property by the corporation were nonadministrative. 

The distinction was laid down in the appropriation act relating to each 
corporation. Thus, the 1945 appropriation limitation for the Reconstruc- 
tion Finance Corporation stated: "Provided, That all necessary expenses 
in connection with the acquisition, operation, maintenance, improvement, 
or disposition of any real or personal property belonging to the Corpora- 
tion or the RFC Mortgage Company, or in which they have an interest, 
including expenses of collections of pledged collateral, shall be considered 
as nonadministrative expenses for the purposes hereof." The foregoing 
formula is typical, but variations in language have prevailed for each cor- 
poration or cluster of corporations to which the nonadministrative expense 
proviso applies. The significance of the exception of nonadministrative 
expense may be deduced from the fact that in 1944 these expenditures for 
corporations and credit agencies reporting them were in the aggregate more 
than five times as great as administrative expenses. 

Administrative and nonadministrative expenses may be very small in 
comparison with program expenditures. Before 1945, program expenditures 
of most corporations were excluded from annual appropriation control. 
However, if new capital or additional authority to borrow was necessary 
to carry out a program, a corporation had to obtain legislative authority and 
appropriations to enlarge its program. 17 Thus, when the Tennessee Valley 
Authority needs new capital to construct additional works, its request is 
scrutinized by Congress just as thoroughly as a similar request by the 
Army Corps of Engineers or the Bureau of Reclamation of the Depart- 
ment of the Interior. If program expenditures, however, are made from 
funds already available to the corporation, the more general practice has 

17 Some government corporations have power to borrow from the investing public. Such 
corporations may enlarge their sphere of activity within the limits of their borrowing authority 
without seeking an appropriation. Thus the Federal Land Banks finance a large proportion 
of their mortgage loans from funds obtained by the sale of securities. Operating costs are 
met and profits result from the spread between the rate of interest the banks pay and the 
rate they receive. The Government Corporation Control Act of 1945 required that corpora- 
tions obtain the approval of the Secretary of the Treasury before selling or buying obligations 
of the United States or obligations guaranteed by the United States in amounts over $100,000. 
Federal Land Banks and certain other agricultural credit corporations, however, were merely 
required to consult with the Secretary of the Treasury. 



250 GOVERNMENT CORPORATIONS 

been that no annually fixed congressional limitation applied. 18 Thus de- 
posit losses by the Federal Deposit Insurance Corporation have not been 
subject to appropriation limitation. The Reconstruction Finance Corpora- 
tion has been able to loan, collect, and reloan its funds as circumstances 
warranted without annual permissive action by Congress. The Smaller 
War Plants Corporation, during its existence in World War II, was lim- 
ited by Congress in its administrative expenditures, but its capital con- 
stituted a revolving fund for making loans. 

Emerging State of Budgetary Control. Our discussion of the state of 
budgetary control over government corporations must necessarily be ten- 
tative, for the ultimate developments under the Government Corporation 
Control Act of 1945 are unpredictable. That act, in its provisions regard- 
ing the submission of budget requests, represented another step in the 
evolution of the types of control already described. It differentiated between 
wholly owned and mixed-ownership government corporations. Insofar 
as the mixed-ownership corporations were concerned the Central Bank 
for Cooperatives and the Regional Banks for Cooperatives, Federal Land 
Banks, Federal Home Loan Banks, and the Federal Deposit Insurance Cor- 
poration the status quo was maintained. No annual budget presentation 
was required of these corporations by the act. 

Wholly owned government corporations that is, corporations other 
than those of mixed ownership listed above were required to submit 
annually a "budget program" through the usual budgetary channels. The 
act specified: "The budget program shall be a business-type budget, or plan 
of operations, with due allowance given to the need for flexibility, includ- 
ing provision for emergencies and contingencies, in order that the cor- 
poration may properly carry out its activities as authorized by law." The 
statute also specified that the budget program contain a statement of the 
financial condition of the corporation and other information calculated 
to enable Congress to evaluate its past performance and its future program. 

The degree to which the legislation of 1945 will actually limit corporate 
autonomy can be determined only as procedure under the act develops. 
The act did not contemplate the financing of corporate activities by appro- 
priation from the Treasury. Rather, its objective was to furnish opportunity 
for congressional review of planned expenditures from corporate funds. 
Thus the act merely applied to all kinds of corporate expenditures the 
type of control that had already developed with regard to administrative 
expenses of many corporations. Incidentally, it was assumed that corpora- 
tions which had been operating under congressional limitation of admin- 
istrative expenses would continue to do so. 

The degree of congressional limitation will depend in large measure on 

. 18 The President's budget for the fiscal year of 1946 included estimates of nonadminis- 
trative expenses and program expenditures by corporations, but these figures were informational 
rather than in request of congressional authorization. 



GOVERNMENT CORPORATIONS 251 

what type of action Congress develops the habit of taking after it receives 
corporate budget programs. Congress could write into the appropriation 
language detailed directions, or it could simply do nothing. The act spe- 
cifically states that congressional action is not necessary to authorize 
expenditure from corporate funds. Congress could, if it wished, examine 
the programs of the corporation. If the plans raised no issue, inaction 
by Congress would erect no bar to corporate execution of programs. How- 
ever, corporations were instructed to include in their 1947 budget programs 
the following authorizing language to be transmitted to Congress: "Ap- 
proval is hereby given to the . . . Corporation, within the funds available 
to it, to undertake the types of programs set forth in its 1947 Budget." 

The problem remained of how corporations would deal with unfore- 
seeable emergencies requiring rapid change of plans. It was proposed to 
include in their first budget program presented for congressional approval 
the following general language applicable to all corporations: "In order to 
meet emergencies or contingencies arising subsequent to approval of the 
Budget and not provided for in the budget program, a corporation covered 
by the provisions of this Act may adjust, with the approval of the President, 
its budget program to provide for the immediate initiation of programs 
authorized by law and not specifically set forth in the approved Budget; 
Provided, That the new program shall be immediately transmitted to the 
Congress as an amendment to the Budget; Provided further, That under 
no circumstances shall a corporation prior to approval by the Congress 
undertake a program which would necessitate an increase in its authorized 
borrowing authority." 19 Reference to the President implied prior review by 
the Budget Bureau. 

Powers of the Comptroller General. The aspect of financial control 
which has received most attention is that of the audit and settlement of 
accounts by the Comptroller General. In much of the discussion of this 
subject two phases of the matter as applied to corporations are not clearly 
differentiated. The first is the body of laws and regulations applied by 
the Comptroller General; the second is their mode of application. When 
expenditures are made from the Treasuryas contrasted with corporate 
funds and are reviewed by the Comptroller General, they become subject 
to all the legal prescriptions of government-wide applicability in the ab- 
sence of positive legislative exception. These rules are frequently in them- 
selves not conducive to efficiency in commercial enterprise. The manner 
in which they are interpreted and the methods by which the Comptroller 
General applies them are a still different matter. Highly formalistic pro- 

10 Such a proviso was reflective of the spirit in which the House Committeee on Expendi- 
tures in the Executive Departments expected the legislation to be carried out. See House Report 
No. 856, 79th Cong., 1st Sess., July 5, 1945. A similar provision had been included in an 
earlier bill proposed by Senator Byrd (S. 469, 79th Cong., 1st Sess., February 5, 1945). The 
hearings on this bill before a subcommittee of the Senate Committee on Banking and Cur- 
rency constitute a valuable source of information on government corporations. 



252 GOVERNMENT CORPORATIONS 

cedures to prove compliance place a great burden of paperwork on govern- 
ment agencies. Moreover, the discretion which rests in the Comptroller 
General in the interpretation of legislation sometimes makes it possible for 
him to exert great influence on the nature of an agency's program. 

A weakness of the Comptroller General's audit as it applies to cor- 
porate enterprise is that it is concerned solely with legality of expenditure 
rather than with efficiency of operation. These two qualities are by no 
means identical. A government agency may make its expenditures in a 
perfectly legal manner and yet be inefficient. Thus, to spend legally, an 
agency must comply with an act requiring competitive bidding in the 
making of public purchases. If all bids are alike, the accepted etiquette is 
to advertise again or to draw lots to determine the successful bidder. David 
Lilienthal points out that if this procedure had been required of the Tenn- 
essee Valley Authority when it received identical bids for cement, it would 
have had to pay excessive prices. Instead it negotiated lower prices. It 
was able to bargain with the intimation that it could construct its own 
cement plant. 20 Such a tactic would have been illegal under ordinary 
procedures, and the Comptroller General would have blocked payment on 
a purchase so made. The General Accounting Office under him is not 
concerned with the operating efficiency of a purchasing system; it seeks 
merely to see that particular payments have been made in accordance with 
law. Naturally, in commercial enterprise freedom in purchases from ham- 
pering routines bulks much larger in importance than in the ordinary depart- 
ment which usually has to make only small purchases for its office needs. 

The statute on purchasing procedures is only one of hundreds of stat- 
utes and many more decisions of the Comptroller General which the Gen- 
eral Accounting Office applies in reviewing the expenditures of government 
departments. A few additional illustrations may be cited of such general pro- 
hibitions which can be waived in particular instances only by congressional 
dispensation, which, needless to say, has been often granted. Land to be 
used for public buildings may not be bought until the Attorney General 
clears the title. All printing must be done by the Government Printing 
Office. Law books and periodicals may not be purchased except by specific 
appropriation. All contracts must be placed in the custody of the General 
Accounting Office. Plans for public buildings must be approved by the 
Public Buildings Administration. In addition to general laws of un- 
equivocal meaning, government departments are subject to a large body 
of rulings produced by the General Accounting Office in the interpretation 
of statutory language. 21 

20 Lilienthal, David E. and Marquis, R. H., "The Conduct of Business Enterprises by the 
Federal Government," Harvard Law Review, 1941, Vol. 54, p. 567. 

21 The above examples are from McDiarmid, John, Government Corporations and Federal 
Funds, Chicago: University of Chicago Press, 1938. This able treatment covers thoroughly the 
general problems of financial control sketched here only briefly. For fuller discussion, see 
below Ch. 25, "Fiscal Accountability." 



GOVERNMENT CORPORATIONS 253 

The relationship of corporations to the Comptroller General has under- 
gone a process of evolution similar to that of their relation to the budget 
process and appropriation procedure. A state of complete freedom from 
review by the Comptroller General was gradually modified by changes 
affecting particular corporations. Finally, in 1945, all corporations became 
subject to inspection of their accounts by the Comptroller General in a 
manner somewhat different from that applicable to ordinary departments. 
Whether a corporation came within the jurisdiction of the Comptroller 
General, thus being subject to the regulations applied by his office, was 
determined before 1945 by the basic legislation and appropriation language 
relating to each corporation. By an executive order of 1934, the President 
directed that corporations created after March 3, 1933, "the accounting pro- 
cedure for which is not otherwise provided by law" should render accounts 
to the General Accounting Office for settlement as prescribed by the Comp- 
troller General. 22 In actual fact, the procedure was generally "otherwise 
provided by law" for each corporation. 23 

Nor was the practice by any means uniform. At one extreme, corpora- 
tions such as the Panama Railroad Company and the Inland Waterways 
Corporation, both created before the date fixed by the executive order of 
1934, retained complete freedom from the Comptroller General. Even 
when Congress limited total administrative expenses for particular corpo- 
rations, it sometimes made it clear that this action did not bring the manner 
of making such expenditures within the regulations applied by the Comp- 
troller General. Thus the 1945 Reconstruction Finance Corporation limita- 
tion indicated that "except for the limitations in amounts hereinbefore, and 
the restrictions in respect to travel expenses, the administrative expenses 
and other obligations of the corporation shall be incurred, allowed, and 
paid" in accordance with the Reconstruction Finance Corporation Act. In 
other instances, administrative expenses alone were made subject to review 
by the Comptroller General. Thus the 1945 limitation on administrative 
expenses of the Smaller War Plants Corporation provided that no part of 
the administrative expense allowance might "be obligated or expended 
unless and until an appropriate appropriation account shall have been 
established therefor pursuant to an appropriation warrant or a covering 
warrant, and all such expenses shall be accounted for and audited in ac- 
cordance with the Budget and Accounting Act." 

All types of expenditures by Federal Prison Industries, Inc. were placed 
under review by the Comptroller General and had to be made "in accord- 
ance with the laws generally applicable to the expenditures of the several 
departments and establishments of the government." The Tennessee 

22 Executive Order No. 6549 of January 3, 1934. 

23 A table showing the relationship of government corporations to the Bureau of the 
Budget and the General Accounting Office in 1944 is printed in the Hearings of the Sub- 
committee of the House Committee on Appropriations on the Independent Offices Appropriation 
Bill for 1945, pp. 807-808. 



254 GOVERNMENT CORPORATIONS 

Valley Authority occupied and still enjoys a peculiar position in relation 
to the Comptroller General. Almost continuously since its establishment, 
TVA has been in controversy with the Comptroller General, who has had 
as allies various groups hostile to its program. The upshot has been that 
TVA is liable to audit by the Comptroller General but that Congress has 
made modifications of general statutes for its benefit. Moreover, TVA 
enjoys by statute the unique right to overrule a disallowance by the Comp- 
troller General under certain circumstances. 24 

Perhaps good and sufficient reasons have existed for excepting the ex- 
penditures of many government corporations from general laws and regu- 
lations. However, one of the consequences has been an unsatisfactory 
system for the inspection of corporate accounts. Not a few corporations 
have employed private accounting firms to examine their accounts. This 
practice is of dubious efficacy for public enterprise. To fill the void, Con- 
gress in its legislation of 1945 directed the Comptroller General to audit the 
financial transactions of all government corporations, but the intent was 
to require a type of audit different from that applicable to ordinary depart- 
ments. When the Comptroller General "audits" and "settles" accounts 
of government departments, he determines whether particular expendi- 
tures have been made in accordance with law and regulation as inter- 
preted by himself. The Government Corporation Control Act calls for 
an annual audit in accordance "with the principles and procedures ap- 
plicable to commercial corporate transactions." 

Thus the act does not operate to bring corporate expenditures under 
the laws and regulations applicable to government departments generally. 
The status quo that existed before the passage of the act is preserved. If 
a corporation was authorized by previous legislation to determine the man- 
ner of making expenditures, that right would live on. Or if a corporation 
was bound by the ordinary rules and regulations, as in the example cited 
above of Federal Prison Industries, that arrangement would also continue. 
The Comptroller General was directed to report to Congress on the find- 
ings of the audit, including u a statement of assets and liabilities, capital 
and surplus, or deficit; a statement of surplus or deficit analysis; a state- 
ment of income and expense; a statement of sources and application of 
funds; and such comments and information as may be deemed necessary 
to keep Congress informed of the operations and financial condition of the 
several corporations." 25 The statute laid the basis for a more satisfactory 

24 An act of 1941 provides that the General Accounting Office "shall not disallow credit 
for nor withhold funds because of any expenditures which the Board shall determine to have 
been necessary" to carry out the provisions of TVA's basic statute. 55 Stat. 775. 

25 The Government Corporation Control Act of 1945 reenacted in substance the relevant 
sections of Public Law No. 4, 79th Cong., approved February 24, ^945, which divorced the 
Reconstruction Finance Corporation from the Department of Commerce and also dealt with the 
audit of government corporations. Separation of the RFC from the Commerce Department 
became an issue in connection with the nomination of Henry A. Wallace as Secretary of Com- 
merce. 



GOVERNMENT CORPORATIONS 255 

i 

financial inspection of corporations than had generally prevailed. At the 
same time, the General Accounting Office was faced with the necessity of 
radically altering its approach to auditing problems in order to achieve 
the needed results. 26 

Central Control of Personnel. A federal department is bound by 
general legislation, administered by the Civil Service Commission, which 
fixes the manner of recruitment of employees, classification and pay 
scales, and other aspects of personnel administration. As a consequence, 
departmental discretion is limited in the selection of staff and in the 
determination of compensation by both legislation and the tradition and 
customs of civil service. Government corporations have placed a high value 
on freedom from civil service rules and procedures, but their special priv- 
ileges in personnel matters are rapidly disappearing. 

The President, by Executive Order No. 7915 of June 24, 1938, provided 
for bringing into the competitive civil service all positions, "including 
positions in corporations wholly owned or controlled by the United States," 
except those exempted by statute. The general terms of the order applied 
to the Commodity Credit Corporation, the Electric Home and Farm 
Authority, the Export-Import Bank, and the Federal Deposit Insurance 
Corporation. 27 The Ramspeck Act of 1940 authorized the President to 
place in the competitive classified service the employees of all government- 
owned corporations except the Tennessee Valley Authority. 28 The Presi- 
dent exercised this power by Executive Order No. 8743 of April 23, 1941, 
which put under the provisions of the Civil Service Act the great 
majority of positions to which the act of 1940 authorized civil service 
extension. 

In the legislation creating the Tennessee Valley Authority, special at- 
tention was given to the personnel question. Congress concluded that the 
undertaking might have a smaller chance of success if it had to operate 
under civil service rules, yet it laid down the following merit-system in- 
junction: "In the appointment of officials and the selection of employees 
for said Corporation, and in the promotion of any such employees or 
officials, no political test or qualification should be permitted or given 
consideration, but all such appointments and promotions shall be given 
and made on the basis of merit and efficiency . . . ." TVA has won an 
impressive reputation for its personnel policies and practices. Its reputa- 
tion has spread so far, wide, and handsome that in recent years few new fed- 



26 For a discussion of the operations of the Comptroller General, see below Ch. 25, "Fiscal 
Accountability," sec. 5, "Audit." 

27 See Pritchctt, he. cit. above in note 3, p. 384. 

2854 Stat. 1211. The statute recognized that there might be legal limits to the extension 
of the civil service laws to corporations of the federal government formed under state laws. 
On the problems of federal corporations and state legislative control, see the excellent mono- 
graph by Weintraub, Ruth G., Government Corporations and State Law, New York: Columbia 
University Press, 1939. 



256 GOVERNMENT CORPORATIONS 

cral agencies felt respectable unless they had at least one TVA alumnus 
in their personnel division. A thorough student of TVA concludes that 
its record in personnel "has been in considerable measure attributable to 
its freedom from time-worn Civil Service procedures and regulations." 29 
He points out, however, that the Civil Service Commission of today is not 
the routine-ridden organization that it was in the early 1930's. 

Freedom from the "time-worn" procedures of the Civil Service Com- 
mission does not ensure by itself better-than-average personnel practices. 
It merely leaves the way open for innovation and managerial responsibility 
in personnel administration. In some instances notably the Home Own- 
ers Loan Corporation in its earlier days the freedom from civil service 
legislation has provided merely an opening for spoils practices. No cor- 
poration other than TVA has gained an outstanding reputation for its 
personnel policies, although some may have done a good job without 
much advertising. 

4. CORPORATE AUTONOMY AND POLITICAL RESPONSIBILITY 

Legislative Bewilderment. The highly formalized overhead controls 
that have been described here constitute methods by which agencies may 
be brought within the orbit of general governmental policy. When these 
methods do not apply and when other controls are absent, presumably 
a government-owned corporation would possess more or less complete 
autonomy within the limits of the resources and authority granted to it 
at the time of its creation. The theory of corporate autonomy may thus 
conflict with the necessity that public activities be in accord with the 
policies and wishes of those who carry political responsibility for the actions 
of government. Or, to put the proposition in another way, it is funda- 
mental that means exist by which administrative officers and governmental 
agencies may be held accountable for their acts to those who bear political 
responsibility the chief executive and the legislature. In terms of manage- 
ment, means must exist by which the operations of the corporation may 
be brought into harmony with related actions of government. 

Of course, the establishment of a corporation with the concomitant 
definition of its functions the instruction about what it is to do is in 
itself an act of direction. It is impracticable, however, for Congress and 
the President, or an agency head acting pursuant to law, to create a cor- 
poration, tell it what to do, and then forget about it. As a matter of 
political necessity, there must be a continuing general surveillance of its 
operations. The government corporation, if it enjoys financial autonomy, 
is removed from the annual executive and legislative review of requests for 

^Pritchctt, C. H., The Tennessee Valley Authority, p. 306, Chapel Hill: University of 
North Carolina Press, 1943. 



GOVERNMENT CORPORATIONS 257 

appropriations. If it is removed from general administrative supervision, it is 
apt as is frequently charged to consider itself not a part of government. 

Congress is somewhat baffled in its dealings with government corpo- 
rations. They do not yield very well to the types of control exercised over 
government departments. In dealing with the ordinary agency, a con- 
gressional committee can tell it how many employees of particular grades 
it can employ during the next fiscal year, can reduce the amount available 
for the salary of an official it dislikes, can periodically put the key officers 
on the carpet, and can enter into a very searching review of the agency's 
plans and proposals. In general, Congress is thus able actually to exercise 
control although interference with the minutiae of administration is not 
a genuine control of broad policy. On the other hand, when Congress 
comes up against a corporation operating a commercial enterprise, differ- 
ent types of evaluation of performance are essential. To criticize and to 
demand more effective management of such an enterprise would not lead 
very far if the usual types of analysis of government operations were fol- 
lowed. 

A sense of frustration seems to arise among Congressmen when they 
are concerned with government corporations. The following exchange 
before a congressional committee between Senator Byrd as its chairman, 
and Jesse Jones, then Secretary of Commerce and boss of the Reconstruc- 
tion Finance Corporation, is a good illustration: 

The Chairman. Will you point out to me now exactly what con- 
gressional authority Congress has over these corporations after the 
first authorization to operate is given to you? . . . We authorize you to 
borrow $5,000,000,000. After that is done, what authority has Con- 
gress over the RFC and how can they exercise it if it has got it? 

Secretary Jones. I suppose if we misuse the funds, you would have 
a good deal of authority? 

The Chairman. How? 

Secretary Jones. I do not know about that. . . . 



The Chairman. ... I am asking you what authority Congress has over 
the RFC after they make their initial authorization. 

Secretary Jones. I have always thought they had all of the authority. 

The Chairman. Tell me how they can exercise the authority. You 
know vastly more about it than I do. They haven't even a report from 
the RFC in detail. 

Secretary Jones. We make monthly reports to Congress. 

The Chairman. You do not make them in detail? 

Secretary Jones. Pretty well in detail. 

The Chairman. You do not give the names of the borrowers? 

Secretary Jones. I think we do 



258 GOVERNMENT CORPORATIONS 

The Chairman. Where does that report go? 

Mr. Mulligan. To the Vice-President and the Speaker. 

The Chairman. Is it a public report? 

Mr. Mulligan. Yes, except since the war I do not know whether 
they have been issued to the general public or not. 

The Chairman. Do you make an annual report to Congress? 

Mr. Mulligan. In addition to the monthly report a quarterly report 
to Congress is also required by law. 

Secretary Jones. A monthly report and a quarterly report. . . . 

The Chairman. ... I have never seen a report on the itemized loans 
of the RFC. 

Secretary Jones. If you will refer to the act, Senator, you will find it 
requires these things, and these reports are sent in here, and you can go 
to the Vice-President's office and get them. 

The Chairman. I am glad to hear you say that. 

Secretary Jones. We will be delighted to send them to the individual 
members that want them. . . . 

The Chairman. I am talking about the itemized statements. 

Secretary Jones. I am talking about the itemized statement. I am 
talking about the loan to John Smith for X dollars, and the rate of 
interest. . . . 

The Chairman. You haven't told me yet what control Congress can 
exercise over the RFC. 

Secretary Jones. I will leave that to Congress. 30 

Political Antagonisms. Congress is not, of course, as helpless as the 
Senator would have us believe in the foregoing passage. However, it is 
certainly true that the legislature has not developed satisfactory ways and 
means for a recurring review of the operations of corporations. The normal 
courses of discussion and criticism are open; when a Senator thunders, 
government officials quake in their boots, whether they be on corporate 
or on noncorporate payrolls. Congress has at its disposal the investigative 
power which has been used effectively in relation to the Tennessee Valley 
Authority, the Home Owners Loan Corporation, and other corporations. 

At times, the intervention of Congress is not calculated to guide gen- 
eral policy but to gain partisan, personal, or local advantage. Thus, over 
several congressional sessions Senator McKellar of Tennessee has con- 
ducted warfare against TV A, attempting to bring its employees under 
Senate confirmation, to deprive it of the use of its receipts, and in general 
to limit the authority of the corporation. The Senator was said to be intent 
upon patronage and to cloak a personal grudge against the chairman of 
TV A, a man not disposed to be pliable when he felt that the interests of 



3 Joint Committee on Reduction of Non-Essential Federal Expenditures, Hearings, pp. 
2295-2297, 78th Cong., 1st Scss., pt. 7, 1943. 



GOVERNMENT CORPORATIONS 259 

the corporation were threatened. 31 This sort of congressional intervention 
is probably the very thing which advocates of the corporate method desire 
to avoid by autonomy. Yet the most liberal corporate freedom will not 
serve to stave off congressional attack on either partisan or policy grounds. 
The political battle has to be won for any activity, whether or not it is 
conducted through corporate form. 

It should be well noted also that most of the corporations have been at 
fault at various times in their relationships with Congress. They have 
partaken in a special degree of the administrative attitude that "what Con- 
gress does not know will not get one into trouble." If corporations expect 
to enjoy a status different from that of a usual department, they must 
furnish information by which Congress can evaluate their operations by 
means different from those applied to the ordinary department. The chair- 
man of TVA has recognized this need and has proposed that special 
arrangements be made by which at appropriate intervals Congress could 
review the work of corporations. 32 

Providing Information for the Legislature. A better flow of informa- 
tion has been reaching Congress since the middle thirties. Principally 
through the stimulus of the Joint Committee on Non-Essential Expendi- 
tures, comprehensive quarterly financial reports are made by the corpora- 
tions to the Treasury and to the Bureau of the Budget. 33 Such reports are 
intelligible to technically competent persons, but they are not a very effec- 
tive method of informing Congress or the public. The President's budget 
annually contains a statement for each corporation showing expenditures 
and receipts, actual and anticipated, just as for ordinary departments. 34 
Some of the corporations publish annual reports. Among the more illumi- 
nating reports are those of the Tennessee Valley Authority. 

Generally, however, the work of the corporations has been a closed 
book to Congress. Take the annual report of the Inland Waterways Cor- 
poration as an example. It is prepared along traditional lines of corporate 
reporting; but even private corporations have discovered that they must 
call in their public-relations advisers as well as their accountants to try to 
make their reports intelligible to their stockholders. The average Con- 
gressman or the average citizen can sweat over the report of the Inland 
Waterways Corporation for 1943 and find that it had a small deficit in its 
transport operations which was offset by profits realized from the sale of 
securities of the federal government. However, from the report it is difficult 
to evaluate the efficiency of the management. Was it more or less effective 



51 See Reynolds, J. L., "McKellar on the Rampage," New Republic, March 27 \ 1944, Vol. 
110, pp. 400-402. 

32 Lilienthal and Marquis, he. cit. above in note 20. 

33 For the present form of these reports, see Budget-Treasury Regulation No. 3 of Sep- 
tember 1, 1944, adopted under Executive Order No. 8512 of August 13, 1940. 

3 * Accompanying the fiscal statements are brief statements of the functions and authority 
of the corporations. This is a convenient source of data on the current status of the corporations. 



260 GOVERNMENT CORPORATIONS 

than in the preceding year? Was the corporation gradually going bank- 
rupt through the impairment of its capital? 85 What could be done to im- 
prove the income-expense ratio? 

The Federal Deposit Insurance Corporation issues an excellent annual 
report. Still, nowhere does it show how much this corporation is costing 
the government in terms of the annual interest charge on capital stock, 
subscribed by the Treasury, which yields no return to the federal govern- 
ment. In most instances it requires prolonged special study to dig up the 
really pertinent facts for the evaluation of corporate operations. Thus, by 
enough research to produce a book, a private scholar might conclude that 
without the subsidy from the Production Credit Corporations, the production 
credit associations would have had to charge farmers about one per 
cent more on loans in 1943 in order to maintain the same services and 
accumulate the same reserves as in 1942. 36 Such data are not ordinarily 
produced by corporate reporting. 

Congress should become better informed on the workings of govern- 
ment corporations by the procedures provided under the Government Coi- 
poration Control Act of 1945. It will receive and review the annual budget 
programs of wholly owned government corporations. It will also be pre- 
sented with reports of annual audits by the Comptroller General of the 
affairs of both wholly owned and mixed-ownership corporations. These 
arrangements will bring the business of each corporation before Congress 
as a matter of routine. They will furnish corporate officials with the 
opportunity to explain their operations, without waiting until a hostile in- 
vestigation arises caused perhaps in part because of lack of better channels 
of communication between the corporation and Congress. In February, 
1946, the House Committee on Appropriations created a new subcommit- 
tee to deal with corporate budget programs and reports a recognition of 
the necessity for specialization within the committee on the problems of 
corporations. 

Enforcing Political Responsibility of Government Corporations. The 
broader question of responsibility has not been realistically faced by gov- 
ernment-corporation enthusiasts. 37 The analogy with the private corpora- 

35 Inadequate information on the state of the assets of a corporation may conceal losses or 
it may result in continued overcapitalization which is, of course, costly to government. A 
statute of 1938 provided for an annual appraisal of the net worth of the Commodity Credit 
Corporation. Impairment of capital would be restored by appropriation, thus bringing losses to 
the attention of Congress. Increment of assets above the authorized capital would be covered 
into the Treasury, thus cutting off the cost of excess capital in the hands of the corporation. 
The President in 1939, in his budget for the fiscal year of 1940 (p. ix), recommended that the 
practice be extended to other corporations. The Government Corporation Control Act requires 
that corporate budget programs include estimates of capital to be returned to the Treasury or 
of appropriations required to restore capital impairments. 

86 Butz, E. L., The Production Credit System for Farmers, Washington: Brookings Institu- 
tion, 1944. 

87 The questions that need to be answered have been posed. See Committee on Public 
Administration, Research in the Use of the Government Corporation, New York, 1940. 



GOVERNMENT CORPORATIONS 261 

tion is not perfect. Although a degree of autonomy is enjoyed by a private 
corporation, a variety of forces operates to enforce responsibility. The 
financial journals, bankers, investment advisers, and such government 
agencies as the Securities and Exchange Commission seek and obtain con- 
siderable information about the operation of a business concern. Larger 
stockholders are certainly not without influence. The need to retain the 
confidence of the financial community operates as a spur to management. 
The mores and habits of a business civilization likewise have their effects. 

These influences are normally not present in the case of a government 
corporation. No very satisfactory substitutes have been evolved save for 
those corporations, such as the Tennessee Valley Authority, which have 
been centers of controversy and have thus been compelled to exert their best 
efforts both to manage their affairs and to inform the public of the results. 
Had the practice of relying on private capital as a partial method of 
financing become more general, government corporations would have had 
to go into the market and sell their securities like private concerns. Under 
such conditions, they might have become subject to the discipline of the 
financial market. This has been true of the Federal Land Banks and 
certain other lending corporations. But the more general practice has been 
to finance government corporate operations solely with public funds. 

The theory of corporate autonomy has been more badly mangled by the 
integration of corporations into the departmental system than through con- 
trol by Congress. This integration comes about partially through neces- 
sity. It is impracticable to permit scores of corporations to drift about the 
administrative cosmos accountable to no one in particular. From an operat- 
ing standpoint, it is also essential that corporate policies be geared into 
related policies executed by ordinary departments. The simplest way to 
accomplish such reconciliation is by bringing the corporation within the 
appropriate department. Thus, Federal Prison Industries, Inc. is within 
the Department of Justice and is managed by those responsible for the 
federal prisons. The Farm Credit Administration has been within the De- 
partment of Agriculture and has functioned primarily as something ap- 
proximating a holding company. Its supervision of the farm credit corpora- 
tions has represented, in part, a specialized substitute for other overhead 
controls. 

Most of the housing corporations are within the structure of the Na- 
tional Housing Agency. The integration of the Defense Plant Corpora- 
tion, the Defense Supplies Corporation, the Metals Reserve Company and 
other defense subsidiaries of the Reconstruction Finance Corporation has 
been accomplished by means other than assignment to the appropriate de- 
partment. In the exercise of its general powers over procurement, the War 
Production Board certified plants to be constructed, supplies to be pur- 
chased, and, in some instances, subsidies to be paid. These corporations 
acted as bankers and managers to carry out decisions made elsewhere. In 



262 GOVERNMENT CORPORATIONS 

their cases, the concept of a corporate board of directors fixing the policy 
of the corporation and exercising an autonomous prudence was thus far 
removed from the actual administrative situation. 

The integration of corporations into the general administrative struc- 
ture has been carried far. It may even be concluded that, by and large, 
a government corporation, insofar as its autonomy in policy is concerned, 
is little different from a bureau or other subdivision of a department. The 
Federal Deposit Insurance Corporation and the Tennessee Valley Authority 
retain their independent identity, but they are exceptional. The corpora- 
tion today usually enjoys certain special privileges that a departmental 
bureau does not have. However, in the exercise of these privileges it must 
in most instances be guided by departmental policy and direction. 

The Contribution of the Corporate Device. In reality there are few, if 
any, corporate operations which could not be accomplished by an ordinary 
department if the usual financial procedures were modified. 38 Corpora- 
tions have tended to acquire some of the characteristics of the ordinary 
department, thereby narrowing the differences between the two. Never- 
theless, most corporations do retain certain distinguishing features. Be- 
fore the passage of the Government Corporation Control Act of 1945, prob- 
ably the most important privileges accorded to many corporations were 
freedom from the annual appropriating process for the major part of their 
outlays, and the right to retain receipts for corporate use. The extent to 
which procedures under this act will modify the autonomy of corporations 
remains to be seen, but the legislation contemplates different arrangements 
for corporations than for ordinary departments. Of comparable import- 
ance is freedom from review by the Comptroller General, which is of very 
great significance in the negotiation and settlement of contracts and other 
business transactions. If the Government Corporation Control Act really 
results in a "commercial" type of audit, it will not narrow corporate priv- 
ileges in this regard. 

Almost all the supposedly desirable features of corporations can be, and 
from time to time have been, given to ordinary departments. It is possible 
in this manner to establish a revolving fund into which receipts are paid 
and from which expenditures are made; to exempt employees from civil 
service regulations; to deprive the Comptroller General of his powers with 
respect to certain types of transactions; and to make exceptions from other 
types of legislative and executive controls. Nevertheless, it has been much 
easier to accomplish these things by creating a corporation than by making 
an open and frontal assault on generally accepted working rules governing 
the entire administrative establishment. 

Perhaps the chief justification of the corporate device is that in times 

38 For a careful comparative analysis of corporations and their equivalents in ordinary 
departments, see White, Leonard D., Introduction to the Study of Public Admin ttration, ch. 9, 
New York: Macmillan, rev. cd., 1939. 



GOVERNMENT CORPORATIONS 263 

of emergency it has been possible to achieve with it urgent objectives which 
might have been more difficult or impossible of attainment by other means. 
By a single action establishment of the corporation men have been put 
to work on a job unhampered by the necessity of conducting a running 
fight with the Bureau of the Budget, the Appropriations Committees, the 
Comptroller General, and the Civil Service Commission. Once the emer- 
gency is over and the operation is proceeding smoothly, the corporation 
can be brought into more orthodox governmental patterns, or it can be 
liquidated. 

The wide use of the corporation and the considerable literature on the 
subject throw into bold relief the general problem of administrative decon- 
centration. The pressure toward uniformity of operating method and 
toward coordination of policy throughout the huge federal machinery 
brings with it formidable issues in the maintenance of initiative and in 
the preservation of conditions favorable to self-reliant management and 
innovation. Unification and uniformity carry with them an inevitable 
degree of congestion at the center, and also delay and hamper action. In 
devising mechanisms for central control we must guard against the ten- 
dency to exert great effort in the achievement of integration and uniformity 
with respect to matters that really are not of sufficient significance to justify 
he trouble. 

The rise of the government corporation reflects the difficulties that sur- 
round responsive administration in the settled forms of the departmental 
system and in higher central controls. Escape from traditional ways of 
doing things through corporate autonomy is not the answer. The solution 
lies in better appreciation of the need for creative freedom of public manage- 
ment buttressed by full responsibility and for forms of control appropriate 
to this fundamental purpose. 



CHAPTER 



Field Organization 



Capitals of nations and states are popularly regarded as the places where 
the business of government is carried on. Actually this business brings 
national and state government into hundreds and thousands of communi- 
ties distant from the capital that is, into "the field." For it is in the field 
that taxes are collected, regulatory laws enforced, and governmental serv- 
ices rendered. This being true, effective administration at the capital is 
not enough. Equally important is the condition of the field service. It 
must be competently staffed. It must contribute to the planning and execu- 
tion of the programs of the various departments and bureaus centered at 
the capital. It must bring these more or less specialized programs into 
coordinated focus for each geographic area cf the country. It must be 
responsive to local as well as national needs, 

1. THE GROWTH OF FIELD ORGANIZATION 

Continental Prototypes. Historically, field organization has been a tool 
used for both the centralization and decentralization of government. The 
centralist emphasis dominated field organization during the centuries when 
Western civilization was emerging from the Middle Ages. The evolution 
of the nation-state was a reaction against the feudal organization of society 
under which state taxes had long ceased to be collected, justice was meted 
out by local authorities, the right to travel highways depended on payment 
of tolls to local lords, the coinage of money was far from a state monopoly, 
and national armies were mere assemblages of groups of vassals of allied 
lords. Naturally, the extent of reversal of these centrifugal tendencies has 
depended upon the king's capacity for reducing his dependence upon 
the feudal lords. This required, among other things, the development of 
a truly national bureaucracy that would carry the king's law and collect 
the king's taxes throughout the realm. 

Accordingly, in France for instance, the king appointed so-called in- 
tendants to represent him in the provinces, with authority over both local 

264 



FIELD ORGANIZATION 263 

governments and subordinate field officials of the different departments 
of the national government. 1 The precedent thus set by the ancien regime 
was not neglected after the Revolution of 1789. Indeed, Napoleon later 
improved upon this centralizing device. The king's intendants, serving 
for twenty or thirty years in their particular provinces, had often asserted 
a measure of independence from the Paris government by encouraging and 
defending local interests. Napoleon, noting these difficulties, deliberately 
ignored the provinces, superimposing on the country's map an entirely 
artificial set of boundaries outlining areal "departments," each of which 
was headed by a prefect representing the central government. This scheme 
of territorial administration has continued since Napoleon's time as a 
major instrument of centralization. Its distinctive feature is that the pre- 
fect represents practically all of the national government's functional de- 
partments. Consequently, most of the functional threads of national gov- 
ernment are pulled together at his level before they are stretched on to 
individual communities and citizens. 

In Prussia, too, and its precursor, the Electorate of Brandenburg, field 
officers were used to weld local feudatories into a centralized nation. Fred- 
erick William, the Great Elector of Brandenburg, in 1657 divided his 
Privy Council into a larger number of specialized departments, and des- 
ignated certain members of the council as local regents. Characteristically, 
the regents were not natives of the areas to which they were assigned. 
Being tied both to the Privy Council and to local areas, the regents were 
effective instruments for insuring local observance of national economic, 
social, and fiscal policies. By the beginning of the eighteenth century, the 
regents had associated with them administrative councils for their areas, 
composed of national field agents. 

< Simultaneously with the development of the local regents and their 
administrative councils, there developed war commissariats scattered 
throughout the country, whose concern for financing, feeding, billeting, 
and clothing the armed forces of the military-minded Prussian state made 
them strong rivals of the regents and councils. As friction between the 
rival establishments increased, the successive kings issued ineffectual man- 
dates directing the commissariats and councils to confer with each other 
in order to avoid wasteful competition, and even introduced royal arbitra- 
tion of individual jurisdictional conflicts. Despairing of these measures, the 
king ultimately merged the councils and the commissariats. As a result, 
the more aggressive war commissariats gained dominance over the coun- 
cils, and the Prussian field service became even more of a centralizing 
force. 2 

1 Cf. Bloch, Marc, "Feudalism: European," Encyclopedia of the Social Sciences, Vol. 6, 
pp. 203-210; Shepard, W. J., "Centralization," ibid., Vol. 3, pp. 308-312; Finer, Herman, 
Theory and Practice of Modern Government, pp. 1223 ff., London: Methucn, 1932. 

C/. Finer, ibid., pp. 1190-1195, 1202. 



266 FIELD ORGANIZATION 

British Development. Considerably before the European continent 
emerged from feudalism, England had established the ultimate dependence 
of all lords and lords' vassals upon the king. Accordingly, she never was 
driven to provide the continental type of counterpoise to the decentralized 
structure of feudalism an army of intendants or regents administering 
local areas on behalf of the king. Instead centralist tendencies took the 
form of local sheriffs designed both to represent the king and to protect 
the rights of local self-government against encroachment by feudal lords; 
or of justices of the peace appointed by the king from among local land- 
owners. However, popular prejudice against the sheriffs as local representa- 
tives of the king resulted in decay of the sheriff's office. Subsequently, the 
attempt to use local justices of the peace as royal administrative agents came 
to an end with the civil wars of the seventeenth century. Thenceforth the 
justices were virtually uncontrolled by London. 

Throughout British development, emphasis was placed on struggles 
over policy formation and therefore over the role of Parliament. The rela- 
tively lighter stress placed upon the machinery through which policies 
would be administered may account for the British failure to follow the 
continental pattern of field integration. In recent times, extension of the 
national government to the field has been through the individual functional 
departments, not through agents representing the whole national adminis- 
tration in particular areas. 3 

Expansion of Federal Functions. In modern times particularly, it is diffi- 
cult to disentangle the motives, or for that matter the results, of the growth 
of field services. To some degree the centralizing factor so conspicuous in 
the modern origins of field organization persists, often with emphasis 
upon supervision of local governments. At the other extreme is a conscious 
effort by national governments to permit adaptation of administration to 
the needs and aspirations of particular regions in other words, to decen- 
tralize the execution of policies that must be formulated nationally. A third, 
and perhaps most important factor in the growth of field organization, 
is^ simply the need to get particular functions performed, with all conscious 
theorizing about centralization and decentralization pushed aside. 

This third factor has dominated the development of the field service of 
our federal government. In the United States, the centralization-decentrali- 
zation dispute has centered on the respective powers of the Union and the 
states. The federal field service has been generally accepted as a necessary 
and unobjectionable complement to those powers that are in fact exercised 
by the national government. That explains, from the historical standpoint, 

9 Cf. Bloch, he. cit. above in note 1; Dhonau, May L, Decentralisation in Government 
Departments, p. 5 ff., London: Institute of Public Administration, 1938; Finer, op. at. above 
in note 1, pp. 1281-1291. For German, French, and British experience, see also Special Com- 
mittee on Comparative Administration, Committee on Public Administration, Social Science 
Research Council, Memorandum on Regional Codrdination, pp. 13-19, 26-43, Washington, 
March, 1943. 



FIELD ORGANIZATION 267 

why the bulk of these field services evolved for such functions as carrying 
the mail, collecting federal taxes, prosecuting and trying legal cases under 
federal law, protecting the frontiers, and building and repairing the ships 
of the Navy. In fact, the story of the growth of the federal field services 
in this country parallels almost directly that of the expansion of functions 
of the national government. In many ways the most interesting phases of 
field administration developed only after the federal government under- 
took important and varied regulatory responsibilities and adopted spending 
programs designed to equalize and support with national resources the 
social and economic opportunities of the citizens of the several states. 

A case in point is the United States Department of Agriculture. Al- 
though established in 1862, the early concentration of this department 
upon research and reporting meant that for many years there was no need 
for a large staff, either in Washington or in the field. Even in 1905, all 
functions could be performed by about 5,000 employees, 70 per cent of 
whom were stationed in the field. Only two of the department's bureaus 
had extensive field services. Yet, in 1939, the demands of regulatory, pro- 
motional, and research functions had so multiplied that the employees 
of the department numbered 82,000 sixteen times the figure for 1905 
while 85 per cent of this total number were in the field service. In the 
period since 1905, field employment had increased both absolutely and rela- 
tively, reflecting the growth and changing nature of the department's 
responsibilities. 4 

Thus expansion of the service and regulatory functions of government 
underlies much of the expansion of field services. Indeed, the very fact that 
national policy could be administered in the fieldaway from Washington 
undoubtedly made more palatable the idea of federal assumption of much 
policy-making that earlier had been thought to belong to state and local 
governments. Similarly, state assumption of local functions has often been 
followed by arrangements for having these functions administered either 
through field agents of the state government or through local governments 
themselves serving in effect as arms of state administration. 

Technological Progress. Particularly in the fields of transportation and 
communication, technological progress has played an important role in the 
expansion of field services. Technology converts local commerce into na- 
tional commerce, and so both furthers the shifting of regulatory and pn> 
motional functions to the national government and necessitates expansion 
of the government's field services. It also affects directly the ease of contact 
between citizens and the national capital and between field agents and the 
central government. In fact, the facility with which Washington officials 

4 Truman, David B., Admini$trative Decentralization, pp. 36-41, Chicago: University of 
Chicago Press, 1940. For an account of the growth of the functions of the Department of 
Agriculture, see Gaus, John M. and Wolcott, Leon C., Public Administration and the United 
States Department of Agriculture, pp. 3-90, Chicago: Public Administration Service, 1940. 



268 FIELD ORGANIZATION 

and citizens in all parts of the country can directly communicate with one 
another even relieves some of the pressure for establishment and expansion 
of field services. Some federal agencies either rely entirely on their func- 
tional divisions at Washington for operating their programs or merely 
establish regional divisions within their Washington headquarters. 

Paralleling this easing of central headquarters-citizen contact, however, 
is the strengthening of bonds connecting departmental officials with their 
field personnel. Through telephone, telegraph, and teletype, through air mail 
and regular mail, and through air and train travel, field agents and central 
headquarters are in daily contact. In practice, this encourages the expansion 
of field services, for central officials need have no fear of losing control 
by setting up field offices. 5 By the very fact that advances in communication 
and transportation remove distance as a barrier to central control, they are 
centralizing influences. Yet, at the same time, they permit creation of a 
field structure within which decentralization of authority can go forward 
without impairing the ultimate responsibility of departmental headquarters 
for the agency's total program and operations. 

Scope of Field Organization. The most perplexing and important prob- 
lems of field organization in this country arise naturally in the federal gov- 
ernment, since its functions extend over greater territory than do those of 
the states. Nonetheless, the states are also faced by the necessity for field 
organization. In general, the states have lagged considerably behind the 
federal government in the development of extensive field services. This has 
been attributable to several factors: (1) the relatively short distances between 
the state capital and the other communities in the state, with the result 
that administration directly from the capital was in most cases reasonably 
satisfactory; (2) the extent to which governmental functions were per- 
formed by counties, towns, and special districts; and (3) the less satisfactory 
state personnel situation, where in many departments employees could not 
be spared for the staffing of field offices. 6 

For all the obviousness of the need for extending administration through 
field services, it is generally startling to look at the statistics that demon- 
strate governmental response to this need. In the federal government, for 
instance, nine employees are stationed in the field for every employee sta- 
tioned in Washington. Of the total of almost 2.4 million federal em- 

5 Nonetheless, there is some indication that field officials in the Far West, being visited 
less frequently by Washington officials and themselves appearing at Washington less fre- 
quently than eastern field officials, have a greater independence of central direction. 

6 On state field services and the related problem of administrative areas, see Hansen, 
G. H., A Regional Redistrictlng Plan for the State of Utah, Provo: Brigham Young University 
Press, 1937; Menefee, Selden C., A Plan for Regional Administrative Districts in the State of 
Washington, Seattle: University of Washington, 1935; Uhl, Raymond, "Administrative Regions 
in Virginia," Public Administration Review, 1942, Vol. 2, pp. 50-63; Hinderaker, Ivan, The 
Administrative Districts and Field Offices of the Minnesota State Government t Minneapolis: Uni- 
versity of Minneapolis Press, 1943. 



FIELD ORGANIZATION 269 

ployccs in April, 1946, about 237,000 were stationed in Washington and 
2,163,000 in the field. The agencies with the largest number of field em- 
ployees were, in the order of size of field personnel, the War, Post Office and 
Navy Departments, all with fields staffs of several hundred thousand; 
and, with less than 150,000 employees in the field, the Veterans Administra- 
tion, the Treasury Department, the Department of Agriculture, the Interior 
Department, the Office of Price Administration, and the War Assets 
Administration. 7 

2. CENTRALIZATION AND DECENTRALIZATION 

Approach to Decentralization. Since field organization has developed 
in the United States not through any master plan but in response to the 
needs of individual departments and bureaus, naturally there is diversity 
among the methods of field administration. Yet, within virtually every 
agency will be found such basic problems as these: thejaropcr degree of 
decentralization. of authorit^^the conflict 9f interests between functional 
experts _at headquarters and general administrators injhe field; the basic 
need for intelligent and sympathetic handling of relations between head- 
quarters and the field; and the complexities of managing a field structure 
having two or even three successive levels. Each of these intra-agency 
problems will be considered in turn. 

The question of the degree to which authority should be delegated to 
field agents requires an appreciation of the character of field organization as 
a facility susceptible of different uses. It is an efficient tool for either centrali- 
zation or decentralization of authority. Whether or not decentralization 
or deconcentration actually characterizes a given field service may be 
discerned from observation of the frequency with which field offices must 
refer matters to central headquarters for decision; the number and specificity 
of central regulations and orders governing field work; the provision for 
citizen appeal to headquarters for overruling of field decisions; the degree 
to which all of the agency's field activities within each geographic area are 
directed by a single field official; the volume of decisions and variety of 
functions of the agency; and the caliber of field officials. 8 Since authority 
stems initially from the center, decentralization requires positive actionJ 
Lack dTfKis sort of actionjresults in centralization. For such representative 
functionTas" tEosc In volvinglKe^gi-anNin^id anchhc agricultural programs, 

7 United States Civil Service Commission, Monthly Report of Employment: Executive 
Branch oj the Federal Government, April, 1946. It should be noted that during World War II 
several central services were removed from the congested national capital. 

$See Truman, op. cit. above in note 4, pp. 56-58, 189; Dhonau, op. cit. in note 3, p. 
16; Ulienthal, David E., TVA: Democracy on the Marih, p. 161, New York: Harper, 1944. 



270 FIELD ORGANIZATION 

the federal government has generally failed to delegate broad authority to 
its field agents. 9 

The factors that usually control the degree to which an agency cen- 
tralizes or decentralizes its authority fall under four broad headings: 
(1) the factor of responsibility; (2) administrative factors; (3) functional 
factors; and (4) external factors. 10 

Factor of Responsibility. The principle of administrative responsibility 
acts as a general deterrent to the decentralization of administrative author- 
ity. The principle itself is familiar. Every agency head in the federal gov- 
ernment is answerable for his general administrative program to the Presi- 
dent, Congress, and the people. He is responsible to central budgetary, 
accounting, auditing, and personnel agencies and to the courts for the 
integrity and legality of his agency's operations. He can also be pilloried 
at any time by the press, committees of Congress, and political enemies 
for right or wrong decisions made by him or his subordinates, however 
picayune the matter. 

As a result, agencies hesitate to delegate broad discretionary authority 
to field officials, who are thought to be less readily controlled than officials 
regularly stationed at the capital. The effects of this system of responsibility, 
though well-nigh universal, are more acute in some agencies than in 
others. An instance is the Public Works Administration, which, because it 
performed an activity traditionally open to the dangers of corruption and 
graft, set up a highly centralized organization. 11 

Administrative Factors. \The second main cluster of factors influencing 
decentralization is administrative in character, specifically: age of the 
agency, stability of its policies and methods, competence of its field person- 
nel, pressure for speed and economy, and administrative sophistication. The 
age of the agency is basic to several of the other administrative factors 
mentioned. Time is required for a new agency to get well staffed and 
organized at headquarters, for key officials to get used to working together, 
and for an esprit de corps to develop that will support high morale in the 

See Key, V. O., The Administration of Federal Grants to the States, p. 222, Chicago: 
Public Administration Service, 1937; Truman, op. at. above in note 4, p. 195; Vieg, John A., 
"Working Relationships in Governmental Agricultural Programs," Public Administration Review, 
1941, Vol. 1, p. 146. Cf. also Appleby, Paul H., Big Democracy, p. 100, New York: Knopf, 
1945. A rough grouping of centralized and decentralized agencies is suggested in Fesler, 
James W., "Federal Use of Administrative Areas," Annals of the American Academy of 
Political and Social Science, 1940, Vol. 207, p. 114. 

10 The itemization and discussion of individual factors here presented are based in part 
upon Gulick, Luther, "Notes on the Theory of Organization," in Gulick, L. and Urwick, L., 
eds., Papers on the Science of Administration, p. 29 ff. t New York: Institute of Public Ad- 
ministration, 1937; Truman, op. cit. above in note 4, p. 17 ff.\ Wallace, Schuyler, Federal 
Departmentalization, pp. 133-144, New York: Columbia University Press, 1941; Dhonau, op. 
cit. above in note 3, p. 13 ff., 135; and Fesler, he. cit. above in note 9, p. 114. 

11 Sec Williams, J. Kcrwin, Grants-in-Aid Under the Public Works Administration, p. 99, 
New York: Columbia University Press, 1939. 



FIELD ORGANIZATION 271 

field. Organization and staffing of a field service, and delegation of author- 
ity to it, must generally await the clarification of organization and author- 
ity at the center. 12 And even after a field service is organized and staffed, 
time must often be allowed for the field service to prove itself worthy of 
the confidence of headquarters officials a confidence that is a prerequisite 
of willingness to decentralize. 

Stability of policies and methods is fundamental. As long as headquar- 
ters itself is in a ferment over the policies to b^pursued by the agency, it 
is idle to talk of decentralization. In some instances, furthermore, it is 
only by temporary centralization of all decisions that headquarters can 
reach the point of establishing a pattern of policies on the basis of which 
decentralization can then go forward. 13 | ^ 

'Agencies differ in the degree to which they can crystallize and stabilize 
policies and methods. May L. Dhonau has suggested that the judicial type 
of administrative work can be decentralized more extensively than other 
types of activity. 14 J Examples would be the settlement of claims to unem- 
ployment insurance benefits and veterans' pensions. For the great mass of 
such cases that are filed by citizens, the answer is provided either in the 
statutes and regulations or in precedents established at headquarters early 
in the agency's life. Only the unusual cases need be referred to head- 
quarters for central decision. 

^The competence of field personnel is a third administrative factor gov- 
erning readiness to decentralize. At the heart of the disinclination to dele- 
gate substantial authority lies the conviction of many officials that only they 
themselves have the ability tcTdo the job as well as it should be done. To 
dissuade them from this point of view requires, among other things, a 
demonstration that others, both at headquarters and in the field, can do 
important parts of the job competently. The field officials must have the 
confidence, not only of the top executives of the agency, but also of the 
functional specialists down the line. The fact that a field office can rarely 

12 In the Works Progress Administration, however, the internal organization of state 
offices was crystallized well ahead of clarification of Washington organization. Sec Macmahon, 
Arthur W., Millett, John D. and Ogden, Gladys, The Administration of Federal Work Relief, 
p. 208 ff., Chicago: Public Administration Service, 1941. 

13 An instance is provided by the Forest Service's centralization of certain phases of 
recreational use of national forests until new policies and standards could be developed. See 
Loveridgc, Earl W. and Keplingcr, Peter, "Washington-Field Relationships in the Forest Serv- 
ice," in the symposium entitled Washington-Field Relationships in the Federal Service, p. 33, 
Washington: United States Department of Agriculture Graduate School, 1942. 

14 Op. cit. above in note 3, p. 135. If central instructions are too precise, of course, no true 
decentralization could ensue, since there would be no significant discretion to be exercised in 
the field despite the volume of transactions conducted there. For the contrast presented in 
the inability of the Office of Production Management to decentralize, see Carey, William D., 
"Central -Field Relationships in the War Production Board," Public Administration Review, 
1944, Vol. 4, p. 35. On all the administrative factors of decentralization this article offers a 
valuable case study. 



272 FIELD ORGANIZATION 

demonstrate as much technical competence as the specialized divisions at the 
agency's headquarters is a chief deterrent to decentralization. 15 ' 

An illustration of the interrelationships of such factors as responsibility, 
age of agency, stability of policies and methods, and competence of field 
personnel is afforded by the Public Works Administration. After two years 
of centralized administration imposed in part, as we noted, because of 
fear of graft and consequent exposure to political repercussions the agency 
decentralized the settlement of many problems. This was practicable, in the 
opinion of top Washington officials, because legal, engineering, and financial 
examiners with experience in the central office could be stationed in the 
field offices, where their analyses and action on project applications would be 
both competent and in conformity with uniform national standards. 16 

I/Problems of decentralization are complicated by a fourth administrative 
factor, the need for speed and economy in administrative operations, both 
to satisfy citizens as clients of the agency and to meet budgetary and effi- 
ciency goals of the agency itself. \ The Disbursement Division of the Treas- 
ury Department, for example, decentralized its certification and payment of 
field payrolls of most federal agencies and, during the depression of the 
1930's, its payment of relief checks. This was done in order to relieve the 
Washington office of the heavy administrative burden and accelerate the 
discharge of the government's financial obligations, thus providing speedier 
service for those to whom the federal government owed money. 17 

\Many other agencies have realized that officials stationed permanently 
in particular regions with authority to take action on behalf of the agency 
will generally have lower travel and communication costs than headquarters 
officials in a highly centralized organization. Their space costs may be lower 
than those in the crowded capital. Citizens will generally appreciate the 
opportunity to deal with a near-by official rather than with a central bureau 
that can be visited only at considerable personal expense. <J- 

Administrative sophistication, particularly with regard to management 
of a field service, is a final factor influencing decentralization. Age is, of 
course, a contributing element, for as has been pointed out an agency 
must often develop its principles of field administration in an experimental 
fashion and then wait for their crystallization as a condition to sound 
understanding of both subject matter and administrative problems by cen- 
tral and field personnel. This requires time, but it also requires a highly 
intelligent and constructive approach by all key officials. A professional 
approach is needed to such questions as the relative values of centralization 
and decentralization, the respective roles of functional experts and general 
administrators, the techniques for breaking down barriers to mutual col- 
laboration between central headquarters and the field service, and the appro- 

15 Sec Carey, loc. cit. above in note 14, p. 35. 

w See Williams, op. cit. above in note 11, p. 93; Key, op. cit. above in note 9, p. 226. 

1* Sec Truman, op. cit. above in note 4, p. 29 ff. 



FIELD ORGANIZATION 273 

priate distribution of functions and authority in a two-tier or three-tier 
field organization. Given a mature approach, an agency may overcome 
many of the apparent obstacles to decentralization. I 

Functional Factors. While factors of responsibility and administration 
set limits to the feasibility of centralization and decentralization for indi- 
vidual departments, the most marked variations among governmental agen- 
cies result from the third major group of factors those concerned with 
functions. Here the factors involve answers to such questions as these: 
How great a variety of distinct functions does the agency have? How 
essential is technical specialization in the agency's work ? Does the function 
require national uniformity or diversity among regions and localities? 

The variety of functions an agency performs may affect its readiness to 
decentralize operations. (\n agency with a single function has a relatively ' 
simple problem of analysis and decision in order to determine the appro- 
priate degree of decentralization. But if an agency performs a variety of 
functions, each of its central divisions may insist on a separate set of field 
offices and districts, may have quite contradictory views on the urgency 
or the extent of decentralization, and may violently oppose control of its 
field agents by a field official representing the department head or his chief 
of field operations.! 

/ Reconciliation of these different viewpoints may be impossible, with the 
result that either no decentralization occurs or each division decentralizes 
as it chooses. In the latter event, the very failure to get agreement on an 
integrated field service for the whole department may retard the process 
of decentralization^ The department head, with full coordinative author- 
ity over officials in Washington but no coordinative machinery in the field, 
may very well fear the possibility of inefficiency, duplication, or direct 
conflict if division heads delegate a large degree of authority to their field 
representatives. It is also true that in cases where two or three divisions 
need to reach joint decisions, the level in the hierarchy of all three where 
the decisions will be ma'de will be dictated by the structure of the least 
decentralized division. \ Consequently, one or more divisions will always 
act as "drags" on the decentralization of other divisions in a department 
performing a variety of functions.| 

fin some agencies there is a pressing need for technical specialization. 
This, particularly in a small agency, usually handicaps attempts to decen- 
tralize the work, as a simple comparison will make clearf If for a certain 
purpose an agency is allowed to have a payroll of fifty employees, it is able 
to concentrate the fifty positions in a central staff within which there can 
be both general administrators and groups of specialists such as engineers, 
chemists, and budget and personnel experts. Or it may want to open per- 
haps forty district offices in the field and assign to each office one employee 
representing the whole agency in all of its specialized aspects, leaving only 
ten at headquarters. This means that both at headquarters and in the 



274 FIELD ORGANIZATION 

field practically all positions will have to be filled by employees who are 
not trained for any of the specialities that could contribute materially to 
an intelligent job of administration. 

Ready examples from recent experience are afforded by the Office of 
Price Administration and the War Production Board. At Washington, 
each agency had an expert on almost every industry and commodity in the 
United States. But to duplicate this range of expertness in field offices was 
out of the question. It is a general rule that no agency has in each of its 
field offices as great a range of specialization as is represented in its head- 
quarters staff. This necessarily acts as a bar to decentralization by agencies 
requiring the services of technical personnel in reaching most of their 
decisions. 

Variety of functions and need for technical specialization are comple- 
mented by a third functional factor the degree of need for national uni- 
formity as contrasted with the need for regional and local variation. This 
factor goes to the heart of differing philosophies of government. It also 
raises the difficult problem of how to measure the relative efficiency of dif- 
fering administrative techniques. Thus it is perhaps both the most basic 
and the least tangible of all the factors bearing on decentralization. The 
fact that a function is within the legal jurisdiction of a central government 
does not mean that its administration cannot be decentralized. Often func- 
tions are shifted to the central government because financial or personnel 
resources are greater there than at lower governmental levels; because policy 
formulation needs to be centralized; or because the central government 
must be looked to for assumption of ultimate administrative responsibility 
on the highest level. However, unless there are affirmative reasons for 
absolute uniformity in detailed operations as well as in general decisions 
of the agency, authority can generally be decentralized to field agents. 

The most obvious need for diversity in administration of a function 
arises in agencies affected by differences in the physical characteristics of 
the various parts of the country. Agricultural, forest, and water-resource 
activities are examples. On the other hand, (the principal drive toward 
centralization comes from insistence that when privileges and penalties are 
being dispensed or rights determined, equity requires an identical adminis- 
trative decision in every identical set of circumstances, whether the case 
arises in Oregon, Louisiana, or Maine. Since administrative decisions often 
involve general elements of judgment, this degree of uniformity cannot be 
assured under a decentralized system permitting each field igent to reach 
independent conclusions on the cases arising in his district? Examples of 
functions demanding uniformity on a national basis are the administrative 
adjudication of veterans' claims for compensation, the review of tax returns, 
and the determination of the relative importance of various products in the 
war procurement program. ^s 

Externtd Factors. A final group of factors bearing on the centralization- 



FIELD ORGANIZATION 275 

decentralization controversy still calls for discussion. It concerns the need 
for an agency to look beyond its own internal operations to external prob- 
lems. The most important are the necessities for bringing the citizen into 
the administrative process, collaborating with other federal, state, and local 
agencies, and adapting field activities to political pressures. 

The first of these factors may be referred to as the degree of need for^ 
support, participation, and representation at the "grass roots" of democracy , x 
If support of a large number of citizens is requisite to successful admin- 
istration as was true of the farm production program and wartime ra- 
tioning and conscription; or if their participation is needed to impart 
wisdom to the local decisions mad^-again a factor in these three programs; 
or if national policy-makers at Washington need vigorous representation 
of regional points of view so as to avoid development of unrealistic and 
extravagantly uniform national plans, then under such conditions a de- 
centralized organization is likely to develop. 18 

The degree of need for collaboration with other federal, state, and local 
agencies is a second external factor in decentralization decisions. Other 
things being equal, an agency's decisions should be made at the level of 
authority that is most convenient for other agencies participating in the 
decision-making process. This mean's that if federal agencies A and B 
have a number of joint activities, their regional officials must have reason^- 
ably similar grants of discretionary authority. It means further that if 
the program is one of federal aid to the states, the federal agency admin- 
istering the program will probably need to establish regional or state offices 
that have the staff and authority to consult with the state governments 
and * give them final answers on many important questions. Similarly, 
pressure for a degree of decentralization develops when an agency's field 
officials are invited to participate in a regional planning commission or to 
collaborate with an establishment promoting regional development, like the 
Tennessee Valley Authority. Nonetheless, it is probably true that the need 
for collaboration with other agencies and groups exerts only a secondary 
influence on a department's determination of the desirable degree of de- 
centralization. 

Finally, among external / factors, political aspects must be considered. 
Since the strength of our political parties lies in their state and local or- 
ganizations, there is some danger that field officials of the federal govern- 
ment will come under heavy local pressures from the powers that be. This 
is the case especially if the field officials have a large degree of discretion 
in such matters as the appointing of employees, awarding of contracts, and 
making of money grants or loans of one kind or another to individuals. 
The problem is particularly acute if patronage governs the selection of key 
field officials such as state administrators of federal agencies. Indeed, it 

18 See Lilicnthal, op. tit. above in note 8, pp. 156-161, and, regarding agricultural land-use 
planning programs, Vieg, he. V.,above in note 9, p. 146. 



276 FIELD ORGANIZATION 

has been pointed out that in the Works Progress Administration "there 
were occasions when state and district administrators took the attitude that 
their primary allegiance was to the local political interest that had obtained 
their appointments rather than to WPA headquarters in Washington." 19 

Generally, field work is more susceptible to political inroads than de- 
partmental work in Washington. Able agency heads consequently may 
shy away from extensive decentralization, lest they be forced to appoint a 
large number of politically sponsored employees. By the same token, an 
able Washington staff saddled with a political field staff may be anxious to 
withhold grants of real power to the field. 

In sum, then, central administrators confronted with the problem of 
how far to go in decentralizing individual activities are likely to be influ- 
enced by some or all of the factors here reviewed. 

3. FIELD-HEADQUARTERS RELATIONS 

The preceding discussion has suggested certain fundamental requisites 
for the maturing of field-headquarters relations in an agency. It may be 
well to restate them. They are: the adjustment of the conflicting interests 
of functional experts and general administrators^ the development of 
methods for improving mutual field-headquarters understanding and re- 
spect;* and discovery of a firm formula to govern relations within a com- 
plex, multilevel field organization. These are all problems that arise in 
every field service, whether authority be centralized or decentralized. 

Rivalry of Functional Experts and General Administrators. The most 
fundamental of the three problems is the rivalry of functional experts and 
general administrators. Each agency's headquarters office is subdivided 
into specialized units dealing with different programs, techniques, controls, 
and services. Some of them are so-called line or operating divisions, re- 
sponsible for important segments of the agency's program. Some contribute 
special skills, such as engineering and statistics. Others exercise manage- 
ment control or perform managerial services, such as budgeting, personnel, 
and space allocation. But each of the main divisions is responsible to the 
agency head or to one of his chief deputies. Each has an institutional pride 
and enthusiasm for its own part of the total program. Each as can be 
understood would dislike to see important phases of its work performed 
or directed by other divisions and officials. In fact, to such extent as a 
division cannot actually perform or direct the work falling within its sub- 
ject-matter specialty, a modification, if not a breakdown, occurs in the 
system of responsibility. 

When an agency's program is projected into the field there arise two 
basic alternatives. Each division may be allowed to set up its own field 
service and directly control the performance of the division's functions in 

w Macmahon, Millctt and Ogden, op. tit. above in note 12, p. 279; see also pp. 269-291. 



FIELD ORGANIZATION 277 

the field. On the other hand, the whole agency may organize an integrated 
field service, with each regional, state, and district director held responsible 
for all agency functions performed in his assigned territory. The first 
alternative has the defect that execution of the agency program is not in- 
tegrated in each field area. The second alternative has the defect that 
functional divisions at headquarters have no direct control over execution 
of their subject-matter programs in the field. A major problem of ad- 
ministration is to avoid the impasse between the apparently irreconcilable 
positions of function and area, of functional experts and general admin- 
istrators. 

The solutions found to this dilemma stem in considerable measure from 
the character of headquarters organization. If the agency head is weak, 
or if the agency is a mere confederation of unrelated functional divisions 
with no really joint objective or program, the functional point of view 
is likely to prevail over the agency-wide point of view in field organiza- 
tion. Many a federal department embraces so wide a range of function* 
and includes such powerful and tradition-encrusted bureaus that any single 
department-wide field structure seems out of the question. Difficult aj 
has been the establishment of agency-wide areal coordination by the Socia! 
Security Board, 20 the task of overcoming functional pulls in such quasi 
departments as the Federal Security Agency, of which the Social Securitj 
Board has been but one of a number of constituent parts, is clearly almos 
impossible. 21 

Sheer size of the administrative task, often but not always a companioi 
of multiplicity of autonomous bureaus and distantly related functions, ma] 
also be a deterrent to real agency-wide field coordination. The volume o 
orders and informational paper that would have to flow to field coordinator 
if functional lines of authority were suppressed in such an agency as th< 
United States Department of Agriculture is fearful to contemplate. 

In general, though, it may be concluded that the ability of a depart 
ment's field coordinators to integrate its functions for given areas of th< 
country will depend heavily on the strength of the department head vis-b-vi 
his bureau heads, and on the inherent need for integration of departmenta 
functions because of their subservience to a single purpose. 

Lines of Command. Establishment of an integrated field service b 
no means ends the problems of function versus area. For there remains 
never-ending tussle over the extent to which the agency's regional dlrecto 
must take orders from functional divisions at headquarters. This applie 
also to the amount of direct contact that will be permitted between region* 
functional divisions and their central prototypes. There are really onl 

20 See Mitchell, W. L., "Washijigton-Field Relations in the Society Security Board," i 
op. ciV.aJjove in note 13, p. 44. 

^fSee, however, Roseman, Alvin, "The Regional Coordination of Defense Health an 
Welfare Services," Public Administration Review, 1941, Vol. 1, pp. 432-440. 



278 FIELD ORGANIZATION 

two choices, because complete autonomy for the regional director is 
unattainable. 

One choice is to require that all programs and major orders dear 
through the administrative hierarchy, while technical advice is handled 
directly between central functional divisions and their regional counter- 
parts. On main instructions to the field, the central functional divisions 
would make recommendations to the agency head or his deputy. The 
latter, on the basis of these recommendations, would transmit to his re- 
gional directors such orders as he, a general administrator like the regional 
directors, deemed desirable. The regional director in turn would see that 
the orders were executed by his regional functional divisions. In this 
pattern, the functional officials are subordinated at each step to the general 
administrators. 

The alternative method, called "dual command," appears at first glance 
to be almost indistinguishable from the relationship just described. How- 
ever, the difference is that between subordinating functional specialties to 
general administration and recognizing "a double line of control." 22 Under 
such dual command, regional functional experts must look for orders both 
to the regional director and to the functional divisions at headquarters. 

Again, as in the question of the feasibility of decentralization, no single 
formula will fit all agencies. Too much depends on the unity of purpose 
of the particular agency and the consequent need for integrating all of its 
functions. 23 A great deal depends also on the effectiveness with which the 
needed integration is actually achieved by a strong agency head. If head- 
quarters is simply a tent under which autonomous bureaus are gathered 
for mere appearance's sake, there is no possibility of a strong regional 
director being able to challenge the flow of "technical" as distinguished 
from "administrative" commands. 

C If the agency really has a single purpose, requiring that its functions be 
geared together, the need for a strong hierarchy of general administrators 
built into both the headquarters and field organizations is great. A single- 
purpose agency has, in addition, the incidental advantage that its regional 
directors can be men and women with some specialized training, able to 
command respect from the functional divisions?/ On the other hand, a 
wide-ranging agency like the Social Security Board must choose "gencral- 
ists" whose contributions to administration the functional experts tend to 
underrate. 24 

In practice, the dynamism of functional divisions and the professional 
bond between the staff of each such central division and its regional coun- 
terpart weight the scales against the general administrators. This combina- 
tion of influences tends to reduce regional directors to mere providers of 

^Macmahon, Millett and Ogden, op. cit. above in note 12, pp. 265-267. 

23 See Stone, Donald C., "Washington-Field Relationships," in op. cit. in note 13, p. 16. 

24 See Mitchell, he. cit. above in note 20, p. 43. 



FIELD ORGANIZATION 279 

common facilities such as space, stenographic pools, and mail routing; 
freely available speech-makers; and recorders of what goes on the field 
"eyes and ears" of headquarters. [The centrifugal force of the functional 
divisions has been so strong that* the administrative problem has nearly 
always been how to strengthen the regional director, and seldom how to 
increase the role of the functional divisions. 25 ) 

Whatever the basic formula hammered out between i 



generalists and functionalists may be, an agency has day-to-day problems 
of headquarters-field relations, most of which revolve about four issues: 
personnel policies; the headquarters office of field operations; communica- 
tions; and control. In the case of personnel policies, field relations are 
often muddied by jealousy over relative salaries.. In the Work Projects 
Administration in March, 1937, for example, the average annual salary for 
Washington was $2,251, but the average salaries for the state and district 
offices were respectively $1,633 and $1,401. 26 

A regrettable lack of mutual understanding also develops when there 
is no exchange of personnel between headquarters and field stations. The 
Bridgeman Committee on reform of the British postal service put both of 
these problems bluntly when it recommended, "As a rule no officer should 
be appointed to an administrative position of importance at Headquarters 
without a thorough training in, and experience of, work in the Provinces. 
There should be no difference in status between the administrative Staff 
at Headquarters and in the Provinces.'* 27 The free movement of personnel, 
both vertically and horizontally, is necessary not only to increase awareness 
of field problems at headquarters and to open opportunities of promotion 
for field staff members, but also to counteract provincialism within field 
districts. 28 

Transfer of field personnel among districts can both widen opportunities^ 
for promotion and overcome provincialism. However, in the Social Se- 
curity Board, each regional office having a vacancy tended to resent the 
passing over of its own staff members in favor of some one from another 
region. 29 The national movement of personnel is also handicapped by the 
need for placating sectional prejudices by the appointment of ^natiyes^ Jo 
rcgionalofficcs, and by the value to an agency of regional representatives 
wno^riTtlioroughly acquainted with the agency's clients in the region and 

25 See Great Britain, Citrine Committee on Regional Boards, Report, p. 7 ff., Cmd. 6360, 
London 1942; Dhonau, op. cit. above in note 3, p. 95 ff., 153; Key, op. cit. above in note 9, 
p. 219 ff.; Williams, op. cif. above in note 11, p. 94; Fesler, James W., "Areas for Industrial 
Mobilization, 1917-1941," Public Administration Review, 1941, Vol. V, pp. 149-166. 

26 See Macmahon, Millett and Ogden, op. cit. above in note 12, p. 229. 

2T Quoted in Dhonau, op. cit. above in note 3, p. 97; for Miss Dhonau's concurrence, see 
p. 154. For United States Department of Agriculture experience, see Truman, op. cit. above 
in note 4, p. 194. 

28 Such provincialism "is one of the most frequent causes of misunderstanding or friction 
in central-field relationships." Loveridge and Keplinger, he. cit. above in note 13, p. 32. 

29 Sec Mitchell, loc. cit. above in note 20, p. 48. 



280 FIELD ORGANIZATION 

sensitive to the more subtle regional trends. 80 A fortunate countervailing 
tendency is the fear of an agency, such as the Public Works Administration, 
that a field administrator might favor, or be accused of favoring, his own 
state or region. The solution hit upon in this agency was "for the ad- 
ministrator to be chosen from outside the district in which he was to 
serve, despite the danger that he might be unfamiliar with local conditions 
and unacceptable to the local officials with whom he should work haiy 
moniously." 31 

Headquarters Office of Field Operations. A second major issue of 
headquarters-field relations is the role and status of the headquarters office 
of field operations. In theory, as we have seen, the principle of the single 
chain of command requires that regional directors receive all important 
orders from the agency head, not from the functional divisions. Yet the 
agency head rarely can give personal attention to each of these orders. 
Hence he often establishes an office of field operations through which all 
functional and other orders proposed for issuance to the field must be 
cleared, the field viewpoint may be reflected to headquarters for staff 
discussions, and the agency head can maintain administrative supervision 
of field operations. 

The dangers inherent in this solution are several. The office of field 
operations may become procedure-minded and fail to develop a broad 
appreciation of the total agency program. It may lack the prestige and 
broad-gauged personnel needed for effective participation in policy coun- 
cils at headquarters. It may overstep its authority by captiously revising 
programs that have been developed by functional divisions. And, by 
barring direct contact between regional directors and headquarters officials, 
it may depress field morale and undermine central-field understanding. 

As the Work Projects Administration discovered, there is in a sense 
no distinguishable division of activity to justify the label of field relations. 
Instead, jevery division at headquarters is concerned with field relations 
and must somehow be linked with the other divisions in a collaborative 
endeavor to get the agency's objectives realized through the field serviofc 
One of the most promising wartime experiments of this character was the 
Operations Council of the War Production Board. It brought together 
regularly the operations vice-chairman of WPB, the regional directors, the 
heads of functional divisions, and the head of the office of field operations. 
In addition, the regional directors caucused separately, with a view to 
pointing up issues that should be brought to the attention of the chairman 
of WPB. 

.Problems of Communication. This suggests the third problem of cen- 
tral-field relations that of communication. The formal pattern for com- 
munication from headquarters to the field is established by such rules as 

30 See Key, op. at. above in note 9, p. 92, 106 ff. 
81 Williams, op. cit. above in note 11, p. 72. 



FIELD ORGANIZATION 281 

"orders must flow through the office of field operations," and "advice may 
flow directly from functional divisions at headquarters to their counter- 
parts in the field." But this formalization of channels by no means meets 
fully all problems. How are regional administrators to keep informed of 
the flow of technical advice to their subordinates? How can field officials 
be given adequate understanding of the total program of the agency? 
How can functional divisions be prevented from dropping "paratroops" 
into regions to perform special brief assignments or how can this practice 
at least be kept from undermining the regional director's responsibility for 
all agency activities in the region? How can field officials be apprised of 
central decisions in advance of their appearance under headquarters date- 
lines in the region's newspapers? How can headquarters answers given 
directly to officials of state and local governments, business corporations, 
and private citizens, be kept consistent with the answers of regional offices 
to the same people? And how can headquarters be kept' informed of -com- 
munications among regional offices ? In addition, there is tKe important and 
puzzling question of the volume and type of reports that field officials 
must file centrally to keep headquarters informed of developments all over 
the country and to facilitate effective supervision over the field services. 

Despite the variety and difficulty of these communication problems, the 
most fundamental question is probably that of how field officials can be 
brought to play a constructive 'part in the formulation of agency policies 
and procedures. Few able officials are content to be mere executors of 
central instructions, or mere pedestrian writers of weekly reports "to keep 
headquarters informed." As Donald C. Stone says, "Policy, programs, 
and procedures must be developed and constantly revalued in terms of 
operating and administrative experience, and, with a few exceptions, this 
experience is taking place in the field."^/Two things are called for: the 
consultation of field officials by headquarters in the development of national 
policies; and the devolution of planning authority/so that, as in the Forest 
Service, officials at each administrative level national, regional, and sub- 
regional will have planning tasks appropriate to their assigned areas and 
interlocked with the plans of the other levels. 33 

Controls Over Field Organization. The need for rigid headquarters 
controls may be in roughly inverse ratio to the success with which com- 
munication problems are solved and real understanding is developed be- 
tween headquarters and the field. 34 Nevertheless, ^communication is never 
so perfect as to obviate the need for all controls. ( 

The three principal methods of headquarters control are advance review, 

^2 Lor. tit. above in note 23, p. 18. 

88 Sec Loveridge and Keplinger, loc. at. above in note 13, p. 31. 

84 See Truman, David B., "Headquarters and the Field/' Public Administration Review 
1942, Vol. 2, p. 359. C/. also Carey, William D., "Control and Supervision of Field Offices,' 
jfttt, 1946, Vol. 6, pp. 20-24. 



282 FIELD ORGANIZATION 

g, and inspection. Advance review interferes to some degree with 



ll-nedged decentralization, for it means the referral of matters to head j 
quarters for decision. An example would be the requirement that eacl 
field office do all the investigation of a case arising in its area, but refe 
the case, with its recommendation and supporting data, to headquarter 
for the actual decision. Differing only in degree is the initial decisioi 
of a case in the field, with the citizen having a ready course of appeal t< 
headquarters. On the management side, advance review can mean control 
of budgets, personnel transactions, space allocation, and other managerial 
facilities. 

Reporting, which has aptly been termed a device of "remote control," 
places reliance on statistical and narrative accounts submitted by field 
officials to headquarters. Through these reports, comparisons can be made 
among field offices to check on efficiency and to spot successful experi- 
ments deserving of application by all field offices. Headquarters can also 
set field offices straight on any problems raised in their reports, and direct 
them to change unsatisfactory practices. 

A chief problem in reporting as a tool of control is that its utility 
depends so much on the very officials over whom control is being attempted. 
Few of them will consciously report adversely on their own operations. 
Consequently, the device of "remote control" is most appropriate for those 
agencies whose field work can be meaningfully measured in quantitative 
terms 35 and for whom, therefore, the form and content of reports can be 
prescribed beyond any ability of the field official to escape self-revelation 
of his errors. Even in such agencies there are instances, like the Work 
Projects Administration, where politically appointed field administrators 
are so distrusted that statistical reporting is set up outside their control, 
pending at least the maturing of reporting methods to the foolproof stage. 36 

Inspection is essential to effective central control, yet it is a constant 
irritant to field officials. Unless they are unusually skillful, inspectors must 
either be superficial and ineffective or be "snoopers" trying to get under 
surface appearances and consequently undermining the field staff's feeling 
that their office chief has the full confidence of headquarters. A field 
administrator tolerates with some distaste the brief visits of central agents 
who subsequently write reports and recommendations on matters he feels 
would require them months or years to master. 

One device for preserving the field official's dignity is to let him see the 
central inspector's report and submit his own comments to accompany it. 
Another, and perhaps the most important, is for the inspector to be more 
a counselor and less a reporter or examiner of formal obedience to pro- 
cedural instructions. As a counselor he may ingratiate himself with the 
field officials and help them with ideas on how to do a better job, prefer- 

85 See Dhonau, op. cit. above in note 3, p. 153. 

86 See Macmahon, Millett and Ogdcn, op. cit. above in note 12, pp. 238-240. 



FIElJD ORGANIZATION 283 

ably letting the ideas appear to originate with the field men themselves. 
The spirit animating inspection work will necessarily depend on the level 
of competence in the field service. Unless the field employees are reason- 
ably able, control, rather than stimulation and encouragement, will be the 
motif of inspection. 

Problems of Multilevel Field Organization. Somewhat distinctive 
problems of central-field relations arise in the multilevel field organiza- 
tion. In many agencies, the typical field structure involves regional offices 
and state or district offices, and, in some instances, a still lower level. Such 
a pattern develops especially among agencies having a large clientele and a 
large volume of field work, with the consequent necessity for local offices 
within easy travel distance of their clients. This may mean up to hundreds 
of local offices. Yet, considering the span of control, it is impossible for 
a headquarters director of field operations to supervise directly so many 
chiefs of local offices. He may meet the problem by providing himself 
with a large staff of assistants in his central office. Or, as is more customary, 
he may establish, say, a dozen regional offices as an intermediate level 
between himself and the local offices. 

The problems coming up in such a multilevel field structure are not 
easily solved. If the regional office is powerful and if devolution of au- 
thority to it is the rule, headquarters will be in inadequate contact with 
the "firing line" of local offices. As a result, headquarters will tend to 
"that remoteness in high places and divorce between theory and practice 
which it is the very aim of decentralization to avoid." 37 Similarly, strict 
hierarchical principles would demand that the regional office have exclu- 
sive inspectional authority over local offices. The consequence would be 
that the central inspectional control save over regional offices would 
tend to atrophy. Of course, it would be dangerous to separate what a 
French scholar, Hauriou, has called the "noncombatants" at headquarters 
from the "combatants" in the local offices. Despite theory, this threat has 
led to frequent deliberate by-passing of the regional offices. If, on the 
other hand, regional offices are not powerful and are inadequately staffed| 
with experts, they become merely delay points in the transmission of 
ters from the local offices to headquarters, which alone has functional 
pertness. 

There is often dispute as to whether headquarters or the regional office 
should determine the location and jurisdiction of local offices and appoint 
their chiefs. It is certainly true that regional offices, in working out their 
supervisory relations to local offices, confront many of the problems of 
internal organization that are prevalent at headquarters, such as the con- 
flict of interest between functional experts and general administrators, and 

87 Dhonau, op. >. above in note 3, p. 134. 



284 FIELD ORGANIZATION 

the question of the desirability of a regional division of field relations. 38 

4. INTERAGENCY COORDINATION IN THE FIELD 

Divergencies in Field Organization. In the United States, as we have 
observed earlier, each bureau and agency having field functions has de- 
veloped its own field service. As a result, the federal government has no 
integrated field organization such as those established by governments of 
continental Europe. Instead, it has well over a hundred separate field serv- 
ices. For each of these, the sponsoring agency locates field offices, delineates 
regional boundaries, and determines the desirable degree of decentralization 
with primary reference to the administrative and functional requirements of 
its own operations, but with slight reference to the broader interests of the 
whole government. 

To some extent, the diversity in field organization is due to minor con- 
siderations of administrative or personal convenience; to political pressures 
affecting the selection of field centers; and to lack of imagination in appre- 
ciating the need for decentralization and the desirability of interagency 
collaboration. 

The importance of these influences can be exaggerated, however. There 
are sound grounds for handling field operations in connection with agri- 
cultural production differently from field operations in taking the census, 
inspecting steamboats, rationing food, settling labor disputes, or supervising 
Indian reservations. Since the clustering and the nature of the phenomena 
with which government is concerned vary, diversity among the field or- 
ganizations for dealing with these phenomena is natural. The factors to 
be considered in laying out regional boundaries, locating field offices, and 
decentralizing authority can be enumerated without too much difficulty. 
Yet the relative weight of each factor will vary agency by agency and 
function by function, with the result that even a consciously logical 
approach to field organization will lead to differing arrangements. 30 

38 Cf. Macmahon, Millett and Ogdcn, op. cit. above in note 12, pp. 200-207, 233-236; 
Hedge, A. M. and Benson, George C. S., "Supervision and Inspection of Local Projects by 
Regional Offices," No. 43 in Committee on Public Administration, Social Science Research 
Council, Case Reports in Public Administration, Chicago: Public Administration Service, 1941; 
Click, Philip M. and Barrows, Leland, "Administrative Reorganization of a Federal Agency-. 
Elimination of Regional Offices," No. 87 in ibid., 1944; Goodnck, M. George, "WPB De- 
centralization Within the Chicago Region," Public Administration Review, 1944, Vol. 4, pp. 
208-219. 

"For descriptive lists, maps, and analyses of federal administrative regions and head- 
quarters, see National Resources Committee, Regional Factors in National Planning and De- 
velopment, pp. 71-82, 203-233, Washington: Government Printing Office, 1935; Fcslcr, James 
W., "Federal Administrative Regions," American Political Science Review, 1936, Vol. 30, 
pp. 257-268; Legislative Reference Service, Library of Congress, Federal Field Offices, pp. 
55-58, Senate Doc. No. 22, 78th Cong., 1st Sess., 1943; Division of Public Inquiries, Office 
of War Information, Regional Offices of Federal Departments and Agencies, Washington, 1945. 

For factors relevant to agency choice of regional boundaries and headquarters, see Legis- 
lative Reference Service, Library of Congress, op. cit.\ Fesler, James W., "Criteria for Ad- 
ministrative Regions," Social Forces, 1943, Vol. 22, pp. 26-32. 



FIELD ORGANIZATION 285 

Granting the need for diversity among field organizations, it can be 
pressed too far. In its extreme version, it would call for a distinctive field 
service for every function and subfunction of every agency, thus destroy- 
ing the idea of an integrated field service, even for an agency with a single 
major purpose. And in cases where the need for diversity is genuine, we 
must still accommodate in some fashion the necessity for interagency co- 
ordination in the field. Attempts to meet this necessity have revolved 
about four problems: increased uniformity in the location of regional 
boundaries and field offices; joint action to effect economies in institutional 
services; coordination in the execution of programs; and coordination in 
the planning of programs. 

Emerging Uniformities. One of the ideas most appealing to the lay- 
man is that of bringing order out of the supposed chaos of regional boun- 
daries and field offices. Its popularity can be constructively used to bring 
field-service geography into greater similarity of pattern in the absence of 
compelling functional or administrative grounds for diversity. On the 
other hand, little likelihood exists of any agreement upon a single master 
scheme of regional boundaries to which all agencies would have to con- 
form. 40 

Identity of regional office locations is an ideal that can be more closely 
approximated than identity of regional boundaries. We observe a definite 
preference among the thirty-three largest federal agencies for certain 
strategically located cities. Leading in preference are Chicago, New York, 
San Francisco, Atlanta, Boston, Kansas City, Dallas, Cleveland, Philadel- 
phia, and Denver. 41 A report of the National Resources Committee 
arrived at the following list of cities as the ideal centers for regional plan- 
ning: Boston, New York, Knoxville, Atlanta, New Orleans, Portland, San 
Francisco, and Denver. 42 Some large departments, even though they are 
not planning an early establishment of integrated field services of a de- 
partment-wide character, are making conscious efforts to get bureau field 
offices located in common cities, and, if possible, in common buildings. 

The United States Department of Agriculture, for instance, has made 
some progress in this direction, even looking beyond field centers to the 
establishment of common regional boundaries for its bureaus. However, 
political considerations have retarded the program. 43 Apparently the early 
efforts have been directed toward building up strong nuclei at Philadelphia, 

40 C/. Fesler, James W., "Standardization of Federal Administrative Regions," Social 
Forces, 1936, Vol. 15, pp. 76-81. 

41 See Latham, Earl, "Executive Management and the Federal Field Service," Public Ad- 
ministration Review, 1945, Vol. 5, p. 16. For a slightly different list of frequently chosen 
field centers, based on all regionalizing agencies for 1934-35, see Fesler, "Federal Adminis- 
trative Regions," he. cit. above in note 39, p. 265 ff., and National Resources Committee, op. cit. 
in note 39, p. 30, 72 ff. 

42 See op. cit. above in note 39, p. 195. 

48 See Appleby, op. cit. above in note 9, p. 99. 



286 FIELD ORGANIZATION 

Milwaukee, Lincoln, Neb., and San Francisco. A final indication of cities 
likely to emerge as regional centers is the Bureau of the Budget's selection of 
Dallas, San Francisco, Chicago and Denver, as the location of its new field 
offices. 44 

Pooling of Field Resources. Whatever the ultimate compromise be- 
tween uniformity and diversity in regional boundaries and headquarters 
will be, there will continue, as in the past, to be need for interagency co- 
ordination in the field. Historically, such coordination was earliest devel- 
oped in attempts at economies in such common institutional services as 
office and storage space, trucking facilities, equipment, personnel, and purJ 
chasing. This was the working focus of the area coordinators of the 
Federal Coordinating Service and the federal business associations from 1921 
to 1933 45 

The most promising recent developments in federal administration 
toward interagency pooling of institutional resources in each major area and 
city are two. One is the decentralization effected within certain institutional 
service agencies, such as the Civil Service Commission and the Disburse- 
ment Division of the Treasury Department. The other is the establish- 
ment of field offices of the Bureau of the Budget. The Budget Bureau, 
through its field offices, is uniquely equipped to draw together in each 
area the institutional service agencies; to link these in turn closely to the 
operating agencies; and to bring pressure for economies that can result 
from effective handling of institutional services. 

We do not minimize institutional services if we hold that if interagency 
coordination in the field focuses on the above objectives alone which was 
largely true throughout the 1920's vastly more important problems of 
administration will be overlooked. One of these is how to coordinate the 
execution of the programs of all federal agencies in any particular region. 
The elements basic to interagency cooperation in the field have been iden- 
tified as: familiarity with other agencies' work; informal acquaintance; 
physical proximity; a specific objective; a limited number of participants; 
and approximately equal status of the participants. 40 

The first two elements awareness of what other agencies are doing 
and an informal acquaintance with their officials in the area can find 
recognition in part through luncheon clubs, such as the surviving federal 
business associations, the USDA Clubs of the United States Department 

44 See the testimony of Budget Director Harold D. Smith, Senate Committee on Appro- 
priations, Hearings, Independent Offices Appropriation Bill for 1945, p. 231, 78th Cong., 2d 
Scss., Washington, 1944. 

48 The field work of the Federal Coordinating Service is critically reviewed in Fesler, 
James W., "Executive Management and the Federal Field Service," in President's Committee on 
Administrative Management, Report with Special Studies t pp. 279-282, Washington: Gov- 
ernment Printing Office, 1937. 

43 /. Fesler, James W., "Interdepartmental Relations in the Field Service of the Federal 
Government," op. fit. above in note 13, pp. 52-55. 



FIELD ORGANIZATION 287 

of Agriculture, and the war agencies' informal gatherings in Boston and 
other cities. 47 Field training programs, wide distribution of annual reports 
of all agencies and the United States Government Manual, and possibly 
the preparation of a consolidated federal annual report for each region 
or state, are additional ways of spreading awareness of other agencies' 
activities. The element of physical proximity of cooperating officials de- 
pends necessarily upon the success of the movement for greater uniformity 
in choice of field offices, and upon greater emphasis toward getting most 
federal offices in the same city into a single building. 

A specific objective and a limited number of participants are essential 
to effective coordination. "Coordination in general" is an illusion. The 
greatest results come when a few officials having vital interest in some par- 
ticular joint problem meet for the purpose of finding a specific answer to 
it. 48 Otherwise, there is no focal point for discussion and no interest 
capable of sustaining the coordinative effort. Approximately equal status 
of the participants is also important, for two reasons. Each cooperating 
official should be able to speak with a degree of authority for his agency 
equivalent to that of the representatives of the other agencies. This ability 
depends on the extent to which authority within each agency has beer 
decentralized. Each participant should also speak with reference to ap- 
proximately the same area as the other officials. This in turn depends 
on the degree of identity of regional boundaries marking out the juris- 
dictions of the cooperating officials. 

Regional Coordtnafors.\^Aost coordination is at present effected througt 
direct contact between field officials of the agencies which need to geai 
their activities together. The fact that this method appears not wholl) 
adequate underlies the suggestions which constantly recur for establish 
ment of some sort of a presidential agent in each region to coordinate al 
federal field officials in that a^eaT^The area coordinators of the formei 
Federal Coordinating Service, subsequently the state directors of the Na 
tional Emergency Council, and more recently the field office heads of th< 
Bureau of the Budget have been the principal responses to this need. On< 
of the main problems is to isolate the functions that such a presidentia 
agent should perform, assuming that he cannot match the French prefec 
in diversity of powers. 

Each state director of the National Emergency Council was instructed 
"(a) to operate a bureau of information concerning the federal agencie! 
and their activities; (b) to promote cooperation among federal agencies 
(c) to act as a liaison officer between the federal agencies and the stat< 
administration; and (d) to report biweekly to Washington on the progres 

47 See Dobbs, John M., "Interagency Communication at the Regional Level ," Public Ad 
ministration Review, 1944, Vol. 4, pp. 64-67. 

48 See Gant, George F., "Bureaucracy in the Field," Public Administration Review, 1943 
Vol. 3, pp. 364-369, esp. p. 368. 



288 FIELD ORGANIZATION 

of each federal agency in the state, critically appraising the effectiveness 
of its work and analyzing the adequacy of the federal program to meet the 
needs." 49 His jxjcin gromqting interagency cooperation anriripgrpH very 
largely a Migg^Hnn^ far "regggf] ^gnygngfg." Each of these 

would convene and preside at meetings of representatives of various 
agencies; use his persuasive powers to stimulate cooperation; keep himself 
informed on all questions of common concern; and report to some central 
agency, preferably attached to the Executive Office of the President, "on 
the region as a whole, unsolved problems, regional cooperation or its ab- 
sence, the need for central decision with respect to particular controversies, 

and the like." In addition, h might h*" "gfj a? g-rpyrinna^rKifrafnr wk*n 

the conflicting agencies agreed on his assuming such a role. He might also 
directly supervise all central institutional services. 50 

A monograph of the President's Committee on Administrative Manage- 
ment proposed regional representatives of the President or of a central 
staff agency who would act in three capacities. They would serve as 
neutral conciliators of interagency conflicts in the field and report irrecon- 
cilable disputes to Washington, where a solution could be found more 
effectively. They would foster mutual acquaintance and familiarity with 
all agencies' field programs among field officials, through sponsorship of 
local federal business associations and statewide meetings of ranking fed- 
eral officials in each state. And they would make special administrative 
studies constituting audits of the effectiveness of field programs of particular 
agencies and of the total pattern of federal field activities in a given area. 51 

Special Coordinative Machinery. All of these experiments and proposals 
indicate a need for affirmative steps directed toward interagency coordina- 
tion in the field. Concern with this need is a responsibility of the Bureau 
of the Budget. In 1943 it described the functions of its field offices as fol- 
lows: "to counsel and advise with federal officials in the field for the pur- 
pose of getting better coordination of federal programs and better rela- 
tions among the federal agencies in the field; to consult with officials of 
state and local government on the operation of federal programs of con- 
cern to them and to report to bureau headquarters problems arising in these 
relationships, with recommendations for their solution; to examine and 
recommend improvements in the utilization of supplies and equipment in 
the field; and to make administrative studies on the initiative of the field 
offices or at the request of other bureau staffs, to make recommendations 
for more efficient operations and to report to bureau headquarters those 

49 Cf. Feslcr, he. cit. above in note 45, p. 282; sec also pp. 283-287 for a critical ap- 
praisal of the National Emergency Council's field service. For a concurring view, see Mac- 
mahon, Millett and Ogden, op. cit. above in note 12, p. 241 ff. 

00 Special Copimittee on Comparative Administration, Committee on Public Adminis- 
tration, Social Science Research Council, op. cit. above in note 3, pp. 12, 21-23. 

51 Fcslcr, loc. cit. above in note 45, p. 292 ff. 



FIELD ORGANIZATION 289 

problems requiring special study or action or a policy statement or guide 
from headquarters." 82 

In addition, passing note should be taken of regional committees and 
boards, especially during World War II, organized by functional agencies 
having coordinative responsibilities affecting a number of agencies. Ex- 
amples are the regional advisory councils of the Office of Defense Health 
and Welfare Services; 53 the local work of the Committee for Congested 
Areas; 54 the manpower priorities committees of the War Manpower Com- 
mission; and the area production urgency committees of the War Pro- 
duction Board. One of the fundamental advantages of such committees is 
that each has a specific objective, in contrast to regional coordinators, whose 
very universality of interest may dull their effectiveness. 

5. THE PROSPECTS OF JOINT FIELD PLANNING 

Much of the interagency coordination discussed above assumes tha 
policy is formulated at headquarters and that the function of field official; 
is primarily to carry central programs into execution. A radical departure 
from such a premise is the view that policy itself should be formulated a 
the regional level. Two principal instruments have been evolved for thi 
purpose: the regional planning commission; and the regional developmen 
authority. 

Regional Planning Commissions. J&egional planning commissions, as 
they have evolved in the United States, haye_ been^ primarily de$ignedLto 
qomplcmgnt the work of state planning boards. Their membership has 
generally stemmecTTiroirr these statef boards." Still, field representatives of 
federal agencies have actively collaborated in important staff studies that 
have strongly influenced the work of the commissions. The noteworthy 
1942 report of the Southeastern Regional Planning Commission, for example, 
was prepared with the aid of the National Resources Planning Board, Tenn- 
essee Valley Authority, Forest Service, Bureau of Agricultural Economics, 
National Park Service, Army Corps of Engineers, Federal Power Com- 
mission, United States Housing Authority, and Work Projects Adminis- 
tration. 55 The National Resources Planning Board, which provided vigor- 
ous federal sponsorship of both regional planning commissions and state 
planning boards, has been abolished. However, continuance of planning 
activities at regional and state levels is to be expected. 56 

52 Latham, he. cit. above in note 41, p. 19. 

M A penetrating analysis of this experience, which has general as well as specific value, 
is provided by Roseman, he. cit. above in note 21. 

64 See Gill, Corrington, "Federal-State-City Cooperation in Congested Production Areas," 
Public Administration Review. 1945, Vol. 5, pp. 28-33. 

55 National Resources Planning Board, Regional Planning: Part XI The Southeast, Wash- 
ington: Government Printing Office, 1942. 

56 See Mcrriam, Charles ., "The National Resources Planning Board: A Chapter in 
American Planning Experience," American Political Science Review, 1944, Vol. 38, pp. 1075- 
1088. 



290 FIELD ORGANIZATION 

Regional planning commissions prepare very valuable reports that serve 
to crystallize desiraBle^policics for long-rangjTgional development. But 
"sHcIT reports lack any reliable implementing mechanism. Planning and 
execution are treated as two distinct fields, and the integration of planning 
through regional commissions is not matched by a similar integration of 
execution. Instead, dozens of federal, state, and local agencies are free 
to accept or reject the proposals of the planners' reports. The reports, 
therefore, are primarily educational in purpose. They fall short of the 
conception in many minds of the need for capitalizing on the vitality 
of regional consciousness and for translating regional planning into con- 
crete results. 

Regional Development Authorities. These reactions to the approach of 
regional planning commissions result in a hospitable reception for the 
idea of regional development authorities modeled on the Tennessee Valley 
Authority. Such authorities provide a focus both for_planning and for 
action. They themselves possess corriprehefldve authority, granted by~Con- 
gress, to perform any functions necessary to the development of the re- 
sources of the region. Yet, if animated by the spirit of TV A, authorities 
of this kind may also endeavor to bring other federal agencies, as well 
as state and local agencies, into cooperative planning and administration. 
Such efforts are facilitated by the financial aid the regional authority can 
offer the functional agencies, and by the reluctance of functional agencies 
to be "frozen out" of any region by the former. 57 

The case for integrated resources development on a regional basis has 
been stated enthusiastically and persuasively in recent years. 58 The success 
of the Tennessee Valley Authority has provided seemingly incontrovertible 
proof of the wisdom of this approach. The President and many members 
of Congress have reacted favorably to the numerous bills for a Missouri 
Valley Authority, a Columbia Valley Authority, and similar new agencies 
focusing on water and related resources. The difficulty of a region's water- 
resource development has always lain in the fact that such development is 
subject to the mercies of the Army Corps of Engineers, Bureau of Reclama- 
tion, Federal Power Commission, Department of Agriculture, Public Health 
Service, Fish and Wildlife Service, National Park Service, and other func- 
tional agencies. This difficulty could presumably be met by giving each 
region of the country a single development authority. Decisions for the 
region would be made in the region, close to the people. They would fit 
together into a consistent pattern for the region, and not clash as is the 
case when each of a dozen federal agencies pursues its own independent 
path. Planning and execution would be tied together and not be isolated 

^ See Pritchett, C. Herman, The Tennessee Valley Authority, pp. 116-140, Chapel Hill: 
University of North Carolina Press, 1943; Fesler, he. cit. above in note 45, pp. 288-290. 
** Notably by Lilienthal, op. cit. above in note 8. 



FIELD ORGANIZATION 291 

from each other, as occurs under the approach of the regional planning com- 
missions. 

Function Versus Area. The issue is not new. It is the ancient conflict 
between function and area. Both are necessary, yet one must have primacy 
The issue is also a reflection in the field of a problem of the center: Ho\v 
to group functions and bureaus into a logical departmental structure at 
headquarters; how to strengthen the department head's authority to inte- 
grate the work of bureaus that have established a tradition of autonomy; 
and how to provide effective interdepartmental collaboration in planning 
and execution of programs involving the interests of more than one agency. 
In other words, the question of regional development authorities arises in 
part because at headquarters there has been no effective coordination of 
agencies dealing with water and other natural resources. 

The most notable lack of coordination is the long-standing rivalry be- 
tween the Army Corps of Engineers, with its primary interest in naviga- 
tion and flood control, and the Bureau of Reclamation of the Interior 
Department, with its emphasis on irrigation and reclamation. These two 
agencies are the principal dam builders of the federal government. Neither 
has heretofore had a fundamental interest in the generation of electric 
power. In the Pacific Northwest, the Bonneville project was built by the 
Engineers, Grand Coulee by the Bureau of Reclamation, while distribution 
of the power was made a responsibility of the Secretary of the Interior. 

Remaining Issues. If the shortcut solution of such problems is the 
establishment of regional development authorities, certain remaining issues 
need clarification. First, the key problems of the Tennessee valley are not 
identical with the key problems of other regions. As between the Tennessee 
valley and the Columbia valley, for instance, entirely different emphases 
must be placed on soil erosion, flood control, irrigation, domestic water 
supplies, fishing, lumbering, and land ownership. 59 

Second, j:he functional jurisdictions of_rcgigjialNdcvclopmcnt authorities 
will have to bp precisely defined. The warmest advocates ot development 
autKorities make no pretense that their technique is applicable to any gov- 
ernmental problems other than unified development of natural resources- 
water, land, minerals, forests. 60 The regional authorities, therefore, are not 
a transplantation from abroad of the prefectural system. Many regula- 
tory and service functions must continue to be performed by field agents 
of central agencies. 

iThird, the fate of Washington bureaus concerned with resources must 
be 'determined. If ten or twelve development authorities blanket the coun- 
try, will there be any need for well-staffed central agencies such as the 
Forest Service, National Park Service, Federal Power Commission, Depart- 



59 See McWilliams, Carey, "Columbia River Bureaucrats," Nation, June 23, 1945, Vol. 160, 
p. 694. 

Cf. Lilienthal, op. cit. above in note 8, p. 168. 



292 FIELD ORGANIZATION 

ment of Agriculture, and Bureau of Reclamation? If not, will the public 
lose some governmental efficiency through the breaking up of these special- 
ized staffs? And will the public suffer increased taxes to support ten or 
twelve specialized staffs for each resources function? 

Fourth, the areas of regional development authorities must be care- 
fully defined if they are not to overlap and so lead to confused responsibility 
qnd "border fighting." Contrary to general impressions, the Tennessee 
Valley Authority has no precise boundaries for its marketing of electric 
power. It markets its power well beyond the valley where the power is 
generated. 

Finally, there has to be some machinery for general supervision of the 
authorities by the federal government. The concept of autonomous au- 
thorities clearly responsible neither to the people's representatives at Wash- 
ington nor directly to regional constituencies is opposed to the democratic 
tradition. There are three possible answers: to make the authorities re- 
sponsible directly to the President; to make them responsible to some 
supervisory unit located in the Executive Office of the President; or to make 
them responsible to the Secretary of the Interior. 61 

Community-Level Analysis. We have noticed that the regional plan- 
ning commissions take a very broad viewpoint and provide no effective 
link between planning and execution. The regional development authori- 
ties in their more ambitious form are a revolutionary abandonment of 
functional administration of resources by the federal government. In addi- 
tion, they leave unanswered the question of joint field planning of non- 
resource activities. More modest and more short-range in objective than 
either of these proposals is a third approach to program planning: com- 
munity-level analysis of the impact of federal programs. 

This approach emphasizes that federal administration, however greatly 
it be functionally segmented, must make sense at the level where its mul- 
tiple activities come in direct contact with citizens and the communities in 
which they live. It is at this administrative "firing line," therefore, that the 
actual interaction of federal operations can best be observed. The symptoms 
of confusion, overlapping of authority, or neglect of citizens' needs can be 
isolated and reported to headquarters and to that regional agent of the 
chief executive who may have the task of interagency coordination. It 
should not be forgotten that a majority of interagency difficulties in the 
field are caused and can only be remedied by action at the central level. 62 

The best solution would seem to be for the Bureau of the Budget's field 

01 See Hansen, Alvin H. and PcrlofT, Harvey S., Regional Resource Development, p. 30 
ff., National Planning Association Planning Pamphlet No. 16, Washington, 1942; Cooke, 
Morris L., "Who Shall Boss the MVA?" New Republic, April 16, 1945, Vol. 112, p. 499; 
Pincus, William, "Shall We Have More TVA's?" Public Administration Review, 1945, Vol. 5, 
pp. 148-152. 

42 See Feslcr, loc. cit. above in note 45, p. 292. See also White, Leonard D., "Field 
Coordination in Liberated Areas/' Public Administration Review, 1943, Vol. 3, p. 189 



FIELD ORGANIZATION 293 

offices to make studies in sample communities or counties covering the total 
impact of Federal programs, 63 report the results to Budget Bureau head- 
quarters, and thereby stimulate remedial action at the center and in the 
field. Corrective action could be backed by the authority of the Executive 
Office of the President and the controls available through budgetary review 
and quarterly apportionment of appropriated funds. Such a method of 
assuring that federal programs fit together is no substitute, of course, for the 
broad-gauged work of regional planning commissions and regional develop- 
ment authorities. However, it does afford a constant test of the short-range 
effectiveness of federal programs and provides machinery for correcting 
such defects as are discovered. 



63 Even more useful would be sample area surveys of the impact of federal, state, and 
local programs, the reports to be a basis for action by all three governmental levels. Some 
experimental studies of this character have already been undertaken; to some extent the 
reports of regional planning commissions are examples of this approach. Mention may also be 
made of the sample studies carried on under auspices of the Council on Intergovernmental 
Relations. 



CHAPTER 



Informal Organization 

1. FORMAL AND INFORMAL ORGANIZATION 

Organic Growth of Informal Organization. This chapter is to deal 
with some of the organizational and operational implications of the difference 
between authority and influence, between the legal power of command 
to direct the behavior of others and the human capacity for getting others 
to see things your way so that they will act and even want to act accord- 
ingly. How this difference affects the role of the chief executive we have 
noticed earlier, 1 but the matter has wider significance. It can hardly 
escape the sharp-eyefl /observer that administrative bodies and indeed all 
organizations, whether legislatures, political parties, labor unions, business 
enterprises, universities, churches, armies, or professional associations 
respond in fact to a variety of informal patterns of influence among their 
membership. 2 These are more or less at variance with the acknowledged 
structure of formal authority on which the organization rests. 

It is therefore easy to understand that an essential object of successful 
administrative leadership must be to provide the integrating forces that 
will draw all eyes toward common goals. In small groups where authority 
is mainly the product of conceded superiority rather than of legal designa- 
tion, the distinctive effect of influence may blend completely with this kind 
of nonlegal authority. As soon as the group grows larger, however, formal 
authority may set itself apart from leadership. While the boss naturally 
will want to run the show, every one else in the group, no less naturally, 
will want to be as independent as possible, and will have his own notions 
of how the show ought to be run. Such individualistic impulses never fully 
subside in any organization. They give rise to the cell formation typical of 
informal organization. 

Charts and Realities. The organization chart which most modern organ- 



1 See above Ch. 8, "The Chief Executive," sec. 2, "Leadership and Authority." 

2 For the increasing interest of students of management in this area of behavior, see above 
Ch. 2, "The Study of Public Administration," sec. 4, "The Frontiers of Research," 

294 



INFORMAL ORGANIZATION 295 

izations require as a source of self-respectshows the formal structure, labels 
the jurisdiction assigned to each component unit, and indicates the lines 
of hierarchical authority established to regulate the conduct of business. 
If the chart is carefully and candidly drawn, the very act of preparing it is 
almost sure to disclose internal ambiguities calling for resolution. If a clari- 
fication of these is a by-product of completing the chart, the labor of the 
chartmaker is already repaid in the smoother operations that can be ex- 
pected to result from a better understanding of working relationships among 
the various groups of employees. At best, however, the organization chart 
is ordinarily and necessarily an idealized picture of the intents of top man- 
agement, a reflection of hopes and aims rather than a photograph of the 
operating facts within the organization. To the sophisticated reader, the 
chart is a useful guide to further questions. 

To begin with, the chart, while locating present personnel, speaks rather 
in terms of positions than of live employees. In such an inevitably com- 
posite abstraction of, say, all possible P-5 economists, we have no clue about 
the kind of man who might be heading the Analysis Section in the Import 
Division, about the standing he has in his section or in the division, or 
about the load of work he carries or has failed to carry. Is he the faithful 
technician who as a lowly and anenymous assistant to the previous section 
head used to get up the figures to support the division's policy and who as 
the "logical" successor now fondles the same series of figures even though 
changing conditions call for an imaginative and fresh analysis of foreign 
trade? Or is he the man who was borrowed from the Research Division on 
a temporary detail to work out a particular problem before the Import 
Division had an Analysis Section of its own, and who impressed the division 
chief so much that the section was created to keep him around? 

Again, was he perhaps the only promising reinforcement the division chief 
could think of in order to bolster an ailing operation, with the position 
of section head happening to be the handiest vacancy to bring him into the 
picture? Or, to suggest only one more line of possibilities, is the position 
again vacant today as we look at the organization chart? If so, is a replace- 
ment in sight and the section's work still definitely part of the whole pro- 
gram? Or is the place not to be filled and the section to be disbanded, so 
that its box in the chart has already turned into an anachronism? Plainly, 
we would need answers not only to these and many more questions about 
our P-5 economist, but also to similar questions about the division chief 
one step above and others in adjoining positions, before attempting to draw 
from the chart an appraisal of his role as the head of the Analysis Section. 

Attitudes and Motivations. However he appears on the chart, this P-5 
stands in a different light to his own subordinates in the section. Here he is 
the boss, clothed with authority to summon and direct, and all his qualities 
of leadership are at stake in the assessment of what that authority is worth. 
To the oldtimer in the section say, with a standing assignment to tabulate 



296 INFORMAL ORGANIZATION 

the weekly figures of customs receipts he may be only another boss, more 
or less like those that have come and gone, to be viewed with indifference 
unless it should occur to the section head that the customs figures ought 
to be compiled differently, or possibly are no longer needed at all. If he 
lets people alone who know their tasks and do them without prodding, he 
is a safe boss; and a safe boss is a good boss in the oldtimer's way of 
thinking. 

To one of the junior economists, however, the boss may be the author 
of that series of articles which broke new ground in the analysis of the 
balance of international payments. This junior may have studied the same 
field, and is cherishing a hope that the boss will develop it within the 
section a prospect rich in possibilities of new assignments and recogni- 
tion for the alert youngster. Another junior of the same rank, though, who 
because of his addiction to doctrinal heresies was passed over whenever 
the previous section head had an especially interesting project to assign, is 
thoroughly alarmed to find that the new head also has a blind spot regarding 
these doctrines. Convinced that he is facing a hopeless situation, he has 
already begun to make discreet inquiries about possible openings in other 
parts of the agency. In a sense, his mind is no longer on the job. 

All of these variables must be accounted for in the staff pattern before 
we can have much of an idea of the concrete work situation. And so with 
the girls in the section. One or two of them can be counted on to stay 
overtime if needed, to get out the materials the boss has to have for his 
conference the first thing in the morning. The others feel that if he cannot 
arrange to get his work done during office hours, they are under no duty to 
bail him out. 

Basis of Personal Organization. Given the crew our section head has 
to work with and allowing for such additions and eliminations as he can 
manage from time to time he develops a team for his purposes. He leans 
on the strengths he finds, and by-passes the weaknesses. He looks to a 
smaller nucleus of people for the crucial work, and he meets with them 
more often. Together they look ahead and lay plans, assemble the strategic 
information and put it into persuasive form, carry the argument when the 
occasion for it arises, and consolidate the advance when their program has 
won endorsement. This is the section head's personal organization perhaps 
no more than a thought-man, an action-man, and a personal secretary. 
Organization charts are silent on the relationships that constitute such 
personal organizations. 

The factors here considered center around the measure of influence that 
our hypothetical subordinate the section head may exert on his imme- 
diate superior and on his own section. The example is taken from the 
middle ranks in the scale of positions, and from a staff or auxiliary function 
in the organization's work for the Analysis Section presumably does not 
actually issue the licenses that are, let us say, the end product of the divi- 



INFORMAL ORGANIZATION 297 

sion's operation. If we shift our example upward or downward in the 
hierarchy, or from a staff or auxiliary section to an operating section, some 
of the situations indicated are no longer so plausible, while other new possi- 
bilities open up. In particular, the higher we go up the line, the more 
complex the relationships become. 

Growing and Shrinking Organizations. Again, we have assumed an 
example from a stable organization. But organization charts are drawn 
also for rapidy expanding agencies. In 1942, for instance, the war agencies 
were recruiting personnel at an almost overwhelming rate as they struggled 
to cope with the new tasks that had brought them into being. As their 
functions grew, their internal structure and external relationships altered. 
Successive newcomers in these agencies caught hold and came to exert 
decisive influence, or failed to catch hold and dropped out of sight. From 
month to month, under the impact of these changes, organization charts 
.became obsolete more rapidly than maps of Europe.** In the same way, 
during the months that followed the close of hostilities in 1945, contraction 
or liquidation and atrophy of functions were the order of the day for most 
of these agencies. Once more, the patterns of influence within the organi- 
zation in many cases changed abruptly. 

In short, the chart portrays the norms of anatomy. We must look to 
the informal organization to understand the physiology perhaps the path- 
ologyof the organism, and the dynamics of its behavior. 

2. ELEMENTS OF INFORMAL ORGANIZATION 

Characteristic Factors. The network of influence does not extend from 
any single center even, it may be suspected, under such a well-consoli- 
dated regime as the prewar Soviet system, which did not mind the burden 
on military discipline arising from the institution of political commissars 
in the Red Army. Certainly in the more familiar field of our own federal 
administration, relationships based on influence result rather from the inter- 
play of a combination of factors. Some are unique to the particular scene. 
Others are recurringly characteristic of many agencies and situations. 

Among the latter we may discern: (1) the relation of the actual leader- 
ship sensed within the organization to the formal location of authority; 
(2) the personal organizations installed or recognized by the leaders within 
the framework of the formal structure, to transmit direction and keep the 
leaders posted on internal conditions; and (3) the ties of allegiances, external 
and internal, that cut across hierarchical levels and bind together groups of 
officials and employees on some other basis than that of loyalty to their 
formal superiors. It is useful also to distinguish the role of these informal 
groupings as supplementary channels of communication and intelligence 
from their potentialities for furthering or hindering the acknowledged aims 
of the organization. These points call for some elaboration. 

Self-Expression of Influence. The magnetism of personal leadership is 



298 INFORMAL ORGANIZATION 

an irrepressible and often an unpredictable force. Responsibility will fre- 
quently evoke it unexpectedly in the head of an organization that is sud- 
denly subjected to new conditions and pressing problems. However, leader- 
ship may fail to appear at the point where there was every reason to count 
on it, and instead turn up elsewhere in the organization. It may indeed be 
ordinarily denied to the titular head of the organization by the very process 
of his selection. 

Nomination for the presidency, to take a conspicuous case, usually does 
not go to a man showing exceptional personal qualities of independent 
leadership if the party chieftains who control the convention can feel confi- 
dent of winning with a more manageable Jand dependable candidate. The 
chairmanship of a congressional committee, where seniority commonly gov- 
erns, will only by accident fall to the dominant personality of the commit- 
tee. Cabinet officers must often be chosen in recognition of claims other 
than the leadership they can promise in running their departments. And 
so with administrative appointments. The conditions of selection too seldom 
permit native qualities of personal leadership to be the decisive criterion. 
Except for a new agency with an active head who is also its actual leader, 
or for a crisis in the life of an older agency that gives a new head an un- 
usually free hand for reorganization, the typical situation therefore shows a 
distribution of leadership through the organization that does not coincide 
with formal authority. All such leadership begets loyalty, and loyalty 
commands influence. 

Obviously, nominal authority does not work in a vacuum; the leadership 
is somewhere. A capable department head may be given jurisdiction over 
an unrelated operation, because the operators must report to some one, and 
no better place for allocation of the function has appeared. If the jurisdic- 
tion is already in satisfactory hands, it may be left alone. Authority to this 
extent tends to follow the pull of leadership. Much the same is true within 
the departmental organization itself and within each of its component 
parts. 

Because one of the chief staff officers serving as immediate advisers to 
the department head may have demonstrated special capacity for achieving 
internal agreements or for sound political judgment or simply for getting 
work done more promptly than others, he is used more and more as a 
privileged source of counsel and assistance. Difficult problems including 
those outside his formal jurisdiction drift to him automatically from the 
desk of the top executive. Other staff officers, and line officials as well, dis- 
cover that it is wise for them to check with this colleague in advance on all 
problematical matters handed up to the department head. In the end, the 
staff officer may be doing the job of a permanent undersecretary, while the 
nominal undersecretary shifts his attention to matters of special interest to 
him. Or, in a given bureau, division, or section, the employee who estab- 
lishes himself as a key man will grow in stature as his responsibilities 
expand de facto by spontaneous accrual 



INFORMAL ORGANIZATION 299 

No doubt, such developments introduce into the hierarchical structure 
much-needed flexibility. They allow an organization to make the most of its 
strength wherever such strength resides. On the other hand, it is also 
evident that as a consequence the organization may develop all kinds of 
unorthodox bulges. From time to time these bulges will be legalized, so to 
speak, as factual influence is given formal status through the redefinition 
of authority and through adjustments in the channels of command. How- 
ever, such formalization may merely aggravate defects in internal balance, 
structural deformities, and lopsided arrangements. With all that, the sur- 
veyor of organizational structure should always bear in mind the need for 
reserving judgment until all compensating advantages of a seemingly bizarre 
pattern have been ascertained. ' A department is not likely to be impressed 
with the criticism that its organization chart looks screwy when the existing 
working mechanisms accord with the operating preferences of its strongest 
personalities and are adequately understood by its personnel. 

Variables Affecting Authority. A complicating factor arises from the 
dynamics of leadership. Authority as expressed in legal terms is essentially 
static. Influence is susceptible of continuous change. Leadership may wane 
as an official commanding deference shows himself unable to stand the 
tough grind of responsibility, or as his health and his nerves begin to falter, 
or as he fails to withstand the jolts and shocks of temporary defeats. In- 
fluence is competitive. When leaders stumble and fall by the wayside, 
rivals will meet their opportunity. As these individuals begin to inject their 
personalities into the stream of operations, new bulges may evolve while 
earlier ones wither away. 

The actual substance of authority is therefore affected by a wide range 
of factors. To support itself, authority cannot merely point to its insignia. 
It must seek to effect constancy of deference. -Thus it requires a basis in 
persuasion. It must nurture itself in consent. It must bargain for endorse- 
ment and negotiate workable covenants with internal forces of opposition. 
Administrative orders, while traveling downward from level of authority 
to level of authority, may completely change their meaning when they 
encounter passive resistance or open antagonism. 8 Authority cannot assert 
itself when its claims fail to rest on plausible reason or commonly shared 
attitudes. To a large extent, therefore, authority must be buttressed by 
rational considerations and appeals. That is why some students regard the 
top executive primarily as a ratifying agent-^one who sanctions the common 
thinking of his organization. 4 In aiming at such sanction, he must prepare 
the ground by shaping common thought. 

8 For a report on general limitations of institutional knowledge about policies and in- 
structions, see Corson, John J., "Weak Links in the Chain of Command," Public Opinion 
Quarterly, 1945, Vol. 9, p. 346 ff. 

4 See, for instance, Coutrot, Jean, "Note sur la Technique du Travail en Commission,' 
Administrative Papers, p. 46 ff., and Morstem Marx, Fritz, discussion remarks, Proceedings, pp 
99-100, Seventh International Management Congress, Washington, 1938. The same basic pom: 
is implicit in McCormick, Charles P., Multiple Management. New York, Harper, 1938. 



300 INFORMAL ORGANIZATION 

Moreover, the exercise of authority is affected by the nature of its man- 
date, which in a real sense is always in flux. The statutory formulation 
of the mission of an administrative organization may remain the same, and 
yet the scope of actual authority reposing in the top executive is bound to 
change with changing circumstances. Most of these circumstances are be- 
yond his own control. We may think of shifting legislative alignments, 
the rise and fall of popular causes, reorientations in general policy, and 
even deteriorating public relations that arrest the individual agency in many 
ways. These variables account for the fact that there are always matters 
of great administrative significance within the reach of the legislative man- 
date of an agency which its top executive would never dare to touch at 
certain times. Particular issues grow too hot to handle while others cool 
off in the battles of public opinion and the contests of political forces. The 
time-bound cycles of popular elections also play their role in determining 
the actual scope of legal authority. 

Even in the most limited sense solely in reference to the specific incum- 
bent the place of formal authority is one of relative importance only. The 
official vested with authority may be personally weak or strong, timid or 
aggressive, unimaginative or intellectually alert, phlegmatic or choleric. 
The same span of legal authority will furnish different individualities with 
different opportunities for initiative and leadership. Even in reasonably 
stable organizations, changes in personnel at the points of control are fre- 
quent enough to cause conspicuous modifications in the interplay of dif- 
ferent personalities. All this does not suggest that formally allocated author- 
ity amounts to little. It does suggest that it is never quite the same as 
circumstances alter. 

Forms of Personal Organization. We have earlier alluded to the phe- 
nomenon of personal organization special structures of relationships built 
freely for the convenience of individual leaders within the formal framework 
of the organization. The members of a personal organization may not 
always be identified as such except to the inner circle they represent. Their 
individual roles will vary, too. On the level of the top executive, for in- 
stance, some members will be primarily sources of confidential information. 
Others may be placed strategically for the stimulation of prompt response 
to administrative directives from above; these members of the top executive's 
personal organization are to "carry the ball" for him in the sphere of opera-, 
tions. While functioning for the most part independently and at different 
points of the hierarchical structure, all members will maintain contact with 
one another as well as with "the chief." They will act in concert, though 
for best effect their synchronized action usually retains the appearance of 
coincidence and spontaneity. 

The existence of such personal organizations formed around individual 
exponents of control the department head, chiefs of larger staff or auxiliary 
services, line officers on various levels of command, and even unit supervi- 



INFORMAL ORGANIZATION 301 

sors at the base of operationsin itself attests to the limitations of formal 
authority. Power of direction may be commensurate with personal respon- 
sibility at each control point of the administrative hierarchy, yet direction 
does not automatically elicit positive response. All large-scale organization, 
because of both its size and its specialization, is highly vulnerable to internal 
indifference, intransigence, and obstruction. Left to himself, even the top 
executive, in the imposing plenitude of his directive power, may have the 
ugly feeling of perching atop an angry elephant firmly set to have things 
his own way. True enough, the executive has his "arms of management" 
administrative planning, budgeting, personnel and his line subleadership 
to rely upon. But how much of this supporting cast can be trusted actually 
to support him? 

How real this question is can perhaps be seen most readily when we 
think of a new appointee taking over a government department. This may 
be an entirely novel experience for him, as it usually is. There is no one 
to brief him on his first day of office. He is lucky if he knows one or two 
key people in the department sufficiently well to be sure of their sym- 
pathetic help right at the start, and some others against whom he should 
be on guard. He may be free to bring along a small number of personal 
assistants each probably as green at the start on departmental business 
as he himself. Replacements in the top range of command will have to 
wait until the new head has had time to reach more or less final judg- 
ments on the internal situation he is facing. 

His first thought in testing personalities he has to depend upon will be 
to have assurance of their complete loyalty so that he in turn can have full 
confidence in them and talk to them without mental reservations. Because 
too many new appointments would mean a heavy mortgage of inexperience, 
he is never free to fire and hire at will, quite aside from the limitations 
placed upon him by the civil service system. In the main, he must learn 
to work with the department as he finds it, and teafh his immediate sub- 
ordinates to take to him and work with him. In some instances he will be 
able to shift individual officers he spots as congenial into positions in his 
proximity. As a general rule, however, he has only a restricted opportunity 
for rearranging the human pattern around him. ^ 

In the experience of his first few months, he will therefore attempt to 
create his own unofficial peerage from within the department. He will turn 
repeatedly to those who win his confidence first. These will become con- 
scious of their task as intermediaries, and in due course will be treated and 
used as such by their colleagues. Unofficial peers can be made and unmade 
by the department head; readjustments in the structure of his peerage may 
happen rather frequently at the beginning, and will continue to occur at 
later periods. Slowly, however, a degree of constancy will evolve in his 
personal organization. At best, its constancy will allow for a recognition 
of those special talents which are at a premium in this kind of grouping. 



302 INFORMAL ORGANIZATION 

One of those rare individuals who have a good grasp of the department 
as a whole perhaps the budget officer, perhaps a bureau chief with many 
years of service and a sufficient variety of successive responsibilities behind 
him is likely to be drawn into the personal organization of the top execu- 
tive. His personal assistants brought by him into the department become 
"charter members," though not necessarily for all time to come. It would 
be erroneous to assume that every one of the political officeholders of the 
department is simultaneously a member of the peerage in our sense. One 
of them may be too intimately tied into a powerful interest group that eyes 
the department head with misapprehension. Another may remain too much 
adrift in the affairs of the department to win standing within it. On the 
other hand, some of the permanent officials will be included in the top 
executive's personal organization because of their strength as leaders, be- 
cause of the multiplicity of their working contacts with others, or because 
of their range of practical experience. In addition, his personal organization 
is apt to reach into such highly sensitive functions as public relations^ 
legislative liaison, and field direction. 

Objective qualifications alone are never enough for membership; above 
such qualifications, the decisive factor is a substantial degree of personal 
compatibility with the intellectual approach and the outlook of the depart- 
ment head. His personal organization is basically made up of "king's men," 
whether as a tight group or as a loose affiliation. Within it, stars may rise 
and fall. There may also be occasional cases of desertion. Moreover, his 
personal organization is never the only one. For greatest utility it must link 
itself to the personal organizations developed by ranking subordinate lead- 
ers. Where a subordinate leader differentiates himself from the fortunes of 
the department head, the latter's personal organization must attempt to 
outmaneuver or to checkmate in one or another form the "king's men" of 
the uncooperative subordinate. Prolonged battles may rage between dif- 
ferent personal organizations. Formal agreements in open conference may 
in many cases be merely the product of informal bargains for support. The 
price exacted for such support may be an important promotion, an enlarge- 
ment of functions, or a greater degree of independence in specified areas. 
Such concessions may interfere with general expectancies based on official 
rules and customs, causing losses in morale throughout the department. 
There is hence always a point of declining returns. 

Yet it is clear that without this type of personal organization, individual 
leaders in the department cannot hope to know what is really going on, 
what the attitudes of the working force are, and how to generate momen- 
tum for cooperative action in the sphere of their own concerns. Teamwork 
is not achieved by mere pronouncement of hierarchical superiors. It re- 
quires recognition of the most accomplished players on each team. Indeed, 
one or two of these may monopolize the actual leadership in the team, 
leaving the nominal leader in the role of a figurehead. At the same time, 



INFORMAL ORGANIZATION 303 

it is obvious that effective personal organization calls for much adroit han- 
dling, and much mature appreciation of relationships, coupled with a sense 
of reality. As with organization in the formal sense, personal organization 
may easily militate against itself. It may become a burden on the individual 
leader, setting him off from his wider institutional environment. It may 
inject elements of arbitrariness or favoritism into general working processes. 
It may substitute subjective considerations for objective evaluations, dis- 
rupting the regularity of operations and destroying the promise of 
planned advancement toward acknowledged aims. 

The balance sheet of personal organization has its debit as well as its 
credit side. On the debit side we would have to enter the possibility of 
doubts seeping through the department about the integrity of management, 
soundness of decisions, and justice in internal allocation of rewards. Per- 
sonal organization can be a great convenience in attaining impersonal 
objectives policy goals. It can also acquire the characteristics of personal 
government and thus corrupt impersonal objectives. An able department 
head will periodically examine the balance sheet and draw his own prac- 
tical conclusions. 

Ties of Allegiance. Formal organization suggests a monolithic structure 
in which all wills are bent toward a defined set of institutional goals. Ac- 
ceptance of these goals is at least implicit throughout the entire structure. 
An outstanding leader at the helm of the organization may not only be- 
come a symbolic expression of the validity and continuity of acknowledged 
objectives but he may also draw forth the allegiance of his subleadership 
and with it that of the large body of personnel. I Even then, however, there 
remain in each individual certain residual allegiances of varying strength 
that exert their pulls in different directions. 5 Man is only in part organize 
able. He lives only in part in his occupation. The fanatic alone is able to 
pour all of his capacity for allegiance into a single cause. 

Normally, every individual responds to a wide range of loyalties some 
embedded in his background, some foisted upon him in the school of living, 
some freely accepted as a matter of deliberate choice. In this agglomeration 
no single loyalty will dominate all others. For satisfying human experience, 
however, all such loyalties should admit of harmonious blending without 
contradiction or conflict. The same applies to man as part of an organiza- 
tion in which he spends his occupational life. No more can be expected 
of him than that the total fabric of his loyalties keep him receptive to the 
goals of the organization he is serving. Yet, notwithstanding a general 
accord of loyalties, each loyalty separately continues to have some influence 
upon him. Each loyalty, depending on the circumstances, may place him 
in part or for a time in juxtaposition to the organization for which he 
works. 



5 For an illuminating discussion of the complex pattern of civic allegiances, see Merriam, 
Charles ., The Making of Citizens, Chicago: University of Chicago Press, 1931. 



304 INFORMAL ORGANIZATION 

This is the basic reason why institutional leadership must constantly 
attempt to magnify individual loyalty toward the institution. Such effort 
cannot be confined to a single approach a single "morale program." It 
must come to the fore in everything the organization undertakes to ac- 
complish. To foster what military language calls "pride of outfit," institu- 
tional leadership must be articulate and persuasive on its objectives and poli- 
cies, adept in developing a general system of internal incentives, resourceful 
in broadening the base for individual participation in determining the ends 
and means of the organization, and inventive in distributing credit for 
collective accomplishment. 

While formal authority rests axiomatically on universal recognition of 
deference owed it, no assurance exists that loyalty will conform to institut- 
tional assumptions. Even in reasonably homogeneous organizations capable 
of producing a common feeling of institutional individuality and identity, 
each member may stand in a different relationship to the organization as 
a whole. Some members may completely give themselves to the organiza- 
tion, regarding it as their better" part. Others may accept institutional 
authority as a pragmatic compromise essential to their cooperative role in the 
organization. Still others may be satisfied with a more passive attitude 
"live and let live" while reserving their deeper attachments for private 
pursuits outside the organization. Finally, there will be those who, though 
not necessarily antagonistic to the organization itself, will strive to super- 
impose on the "powers to be" values derived from loyalties other than that 
demanded by the organization. 

Such competing loyalties may have external or internal focus; often both 
types are intermingled imperceptibly. Under the external rubric, for exam- 
ple, we may think of a bureau chief who has driven such firm roots into 
the function entrusted to his bureau that he consciously or unconsciously 
reflects in all his thinking the preferences of the outside interest group which 
looks upon this function with proprietary eyes. He has wholly equated 
his responsibility with the ends pursued by the interest group. If anywhere 
challenged by his official superiors, he does not hesitate to plot his defense 
in closed session with the chieftains of the interest group. These may make 
him feel like a central figure in their councils, run personal publicity for him, 
and build him up as a great public servant or a national expert. Blind to 
more general objectives, he comes to consider his superiors as evil forces 
against which he must battle tenaciously in order to guard the function of 
his bureau and the outside interest that supports it and him alike. 

Or we may think of an assistant secretary in a department whose creden- 
tials for public service stem from earlier political affiliation with a legislative 
bloc that because of its aims inevitably impinges upon the department. His 
official chief may deal with him as if he were as he essentially is a hostile 
observer posted for sniping, missing no chance of capitalizing on his legisla- 
tive support in order to further the purposes of the legislative bloc. Every 



INFORMAL ORGANIZATION 305 

it is obvious that effective personal organization calls for much adroit han- 
dling, and much mature appreciation of relationships, coupled with a sense 
of reality. As with organization in the formal sense, personal organization 
may easily militate against itself. It may become a burden on the individual 
leader, setting him off from his wider institutional environment. It may 
inject elements of arbitrariness or favoritism into general working processes. 
It may substitute subjective considerations for objective evaluations, dis- 
rupting the regularity of operations and destroying the promise of 
planned advancement toward acknowledged aims. 

The balance sheet of personal organization has its debit as well as its 
credit side. On the debit side we would have to enter the possibility of 
doubts seeping through the department about the integrity of management, 
soundness of decisions, and justice in internal allocation of rewards. Per- 
sonal organization can be a great convenience in attaining impersonal 
objectives policy goals. It can also acquire the characteristics of personal 
government and thus corrupt impersonal objectives. An able department 
head will periodically examine the balance sheet and draw his own prac- 
tical conclusions. 

Ties of Allegiance. Formal organization suggests a monolithic structure 
in which all wills are bent toward a defined set of institutional goals. Ac- 
ceptance of these goals is at least implicit throughout the entire structure. 
An outstanding leader at the helm of the organization may not only be- 
come a symbolic expression of the validity and continuity of acknowledged 
objectives but he may also draw forth the allegiance of his subleadership 
and with it that of the large body of personnel. J Even then, however, there 
remain in each individual certain residual allegiances of varying strength 
that exert their pulls in different directions. 5 Man is only in part organize 
able. He lives only in part in his occupation. The fanatic alone is able to 
pour all of his capacity for allegiance into a single cause. 

Normally, every individual responds to a wide range of loyalties some 
embedded in his background, some foisted upon him in the school of living, 
some freely accepted as a matter of deliberate choice. In this agglomeration 
no single loyalty will dominate all others. For satisfying human experience, 
however, all such loyalties should admit of harmonious blending without 
contradiction or conflict. The same applies to man as part of an organiza- 
tion in which he spends his occupational life. No more can be expected 
of him than that the total fabric of his loyalties keep him receptive to the 
goals of the organization he is serving. Yet, notwithstanding a general 
accord of loyalties, each loyalty separately continues to have some influence 
upon him. Each loyalty, depending on the circumstances, may place him 
in part or for a time in juxtaposition to the organization for which he 
works. 



5 For an illuminating discussion of the complex pattern of civic allegiances, see Merriam, 
Charles ., The Making of Citizens, Chicago: University of Chicago Press, 1931. 



306 INFORMAL ORGANIZATION 

other lawyers; an engineer dealing with lawyers may gravitate instinctively 
toward support of the views of other engineers. Or, in questions of func- 
tional grouping and allocation of responsibilities, individual categories of 
specialists may predicate their opinions primarily on their conception of the 
stake of their specialty in the proposed arrangement. 

In addition, personal association of a comparable character with cor- 
responding investment of loyalty may spring from common backgrounds. 
Graduation from the same college or professional school is one illustration; 
earlier staff experience in the same scientific foundation or research institu- 
tion or consulting firm is another. Like any other type of large-scale organi- 
zation, moreover, government departments have their ideological factions 
here the "liberals," there the "conservatives." Eager stalwarts of each fac- 
tion are likely to look at the department as a potential area of conquest, or 
at least an object of proportionate influence. Factional struggles may not 
always be conspicuous, but the sense of loyalty produced in their heat may 
leave little loyalty to the department itself. Finally, we should mention the 
ties of allegiance among the organized rank and file of employees. The 
locals of government-employee unions may attract to themselves a substan- 
tial share of loyalty, especially in the face of an unsympathetic or laggard 
departmental leadership. 

Thus the actual pattern of human relationships and allegiances within 
the formal organization is distinguished by obvious complexity. Reference 
to "channels of command" may becloud the real picture. Uncrowned lead- 
ers compete with crowned ones. Informal and often unaccountable group- 
ings brought to life for various purposes press against one another. Nor are 
the underlying motivations always either clear or durable. Human beings 
freely exercise their privilege to change their minds on what seems worth 
their effort. So does man in organization. This explains in part why any 
given organization may demonstrate great vigor at certain times and may 
virtually fall apart or drop into a coma at certain other times, even though 
its general mandate or its formal structure remain unchanged. It also casts 
a sharp light on the folly of considering a department a mighty steamroller 
pursuing its aims with mechanical precision. Last but not least, it shows 
how much we borrow from imagination when we talk about the sinister 
designs of a single-minded bureaucracy. 

3. NONHIERARCHICAL SOURCES OF POWER 

Democratic theory stresses the unregimented evolution of free associa- 
tions of citizens who can raise their voices politically and speak for them- 
selves. The very diversity of these associations is justly considered an asset 
to democratic governance. Public preferences can be tested in open argu- 
ment. Fresh ideas can find direct and immediate expression. Workable 
compromises can be forged in the adjustment of group aims to one an- 
other. This, we feel, is the soundest way of tapping and mobilizing the 



INFORMAL ORGANIZATION 307 

political resources of the whole nation. Even those who occasionally doubt 
the productivity of too much diffusion and too much milling movement 
on the political scene would be very reluctant to sacrifice the values of un- 
impaired self-expression to a superimposed "order" that would choke group 
autonomy under a gigantic blanket of directed uniformity. But free politi- 
cal competition is not without pitfalls. It may operate to the detriment of 
the public interest. There is a great difference between the National League 
of Women Voters and an economic pressure group whose voting strength 
or financial support may in effect corner much of the political mar- 
ket. 7 It is all too evident that pressure politics may degenerate into brash 
hijacking. 

Informal organization offers some close parallels. Unless confined in 
both scope and form, it may turn into a disorganizing force, undoing at 
least in part what formal organization is intended to achieve. It may dan- 
gerously widen the cracks and crannies which division of labor and segre- 
gation of functions inevitably tears into the structure of all formal organi- 
zatioijA It may in certain areas actually nullify official responsibility. With 
all that, informal organization does meet practical needs. Like the free in- 
terplay of democratic groups in the civic realm, it is in many respects a 
source of administrative vitality. It provides additional outlets for group 
opinion, thus extending and broadening the avenues of institutional plan- 
ning and thought. Informal leadership, moreover, is in a sense as much 
a school of responsibility as the exercise of official authority. In short, in- 
formal organization, aside from being a perfectly natural growth, not only 
to some extent eases the rigidities of hierarchy but also can work as a desir- 
able stimulant to a timid or uninspired top command.Y How far it does 
the latter will depend mainly on the public spirit of its leaders. ^ 

This may become clearer through a more specific review of some com- 
posite pictures of fairly typical manifestations of informal organization. 
Each manifestation is selected at random, without any attempt at complete- 
ness of display. But all have one feature in common: they demonstrate 
nonhierarchical sources of power. That is to say, they show concrete points 
. of influence that are separate from the structure of hierarchical power, even 
though in some instances they are related to the location of formal authority. 

Men Behind the Throne. As no ruler be he an omnipotent dictator 
or a constitutional president thinks and acts in splendid isolation, as there 
are always men and women in his entourage who intentionally or uninten- 
tionally help him to make up his mind, 8 so the head of a government de- 
partment, however retiring and introvert by nature, is surrounded by his 
"inner circle." He may have a regular "cabinet" of his own, made up pcr- 

7 Sec below Ch. 14, "Interest Groups in Administration," sec. 1, "The Meaning of Interest 
Representation." 

8 For a penetrating discussion, long overlooked, see Bentley, Arthur F., The Process of 
Government, Chicago: University of Chicago Press, 1908; republished Bloomington: Principia 
Press, 1935. 



308 INFORMAL ORGANIZATION 

haps of his principal staff and line officers, with whom he discusses matters 
of general importance at a set hour each week or oftener. On special issues 
he may confer with smaller or larger groups of officials, excluding those 
members of his cabinet not directly concerned, and drawing in other officers 
who do not ordinarily attend the cabinet meetings. Consultative organs of 
some kind are an administrative necessity; whether they are always intel- 
ligently utilized is still another question. 9 However, the existence of such 
machinery seldom gives a hint about the way in which the top executive 
frames his judgments. He may be merely a polite listener. He may simply 
believe such formally organized consultation to be a proper democratic 
gesture. Or he may use his cabinet meetings primarily as a method of 
communicating his decisions to the first level of his subleadership. How, 
then, does he reach his decisions? 

It is at this point only that we turn from formal organization to in- 
formal one. The insider may tell us that the cabinet is just a ritual; that 
there is in fact something like an "inner cabinet" of only three members; 
and that one of these is not even included in the official cabinet. Those in 
the inner cabinet are the "men behind the throne." The one who does not 
belong to the official cabinet is the senior personal assistant to the depart- 
ment head. For many years he has been the political shadow of the man 
who now directs the affairs of the department a relationship that developed 
long ago in local politics and has been reinforced in the test of changing 
fortunes as both made their way within the currently dominant major 
party. This personal assistant has no clearly defined functions. He is r 
Colonel House or a Harry Hopkins to the department head. Moreover, he 
is the department's most important liaison to the party leadership and tht 
legislative body as well. He and "the chief" have come to think as one 
nind. The other two members of the inner cabinet are one of the assist- 
ant secretaries and a bureau chief. The assistant secretary is the youngest 
man on the top level, but he has proved himself an invaluable fountain 
of fertile ideas. That is the reason why he overshadows the undersecretary, 
who is weighted down by a heavy burden of operating responsibilities. The 
bureau chief is known neither for imaginative thinking nor for good 
political judgment. However, he has been with the department for nearly 
two decades and he knows its practical business inside out. 

It is with these three men that the department head arrives at his deci- 
sions, sometimes at a tray luncheon in his office, sometimes during a brief 
session preceding a meeting of his cabinet. Because all four know each 
other very closely, they are able to express themselves in some kind of short- 
hand language, coming to the point in a few words. There is not only 
extraordinary economy in their method of oral communication, but each 
is also fully aware of every one else's general bias, including his own. This 

9 Cf. Morstein Marx, Fritz, "Bureaucracy and Consultation," Review of Politics, 1939, Vol. 
1, p. 84 ff. 



INFORMAL ORGANIZATION 309 

introduces desirable checks. On the other hand, their joint consultations 
often end merely in preliminary determinations what sort of study to call 
for by the administrative-management unit; whom to ask for further in- 
formation; what kind of fact-finding to set in motion. Thus this group of 
four is linked to the hierarchy to the extent that it jointly exercises the ex- 
ecutive function. However, the status of the three members of the inner 
cabinet is as unofficial and informal as the department head's personal or- 
ganization, which may be much larger in size and may overlap his official 
cabinet only in small part. 

The type of consultative grouping here portrayed resembles a regency, 
with the king withdrawing, for all practical purposes, into the role of one 
member. In other comparable institutional situations, the "men behind the 
throne" may be an equally small body of departmental elder statesmen with 
or without actual veto power; or a more fluid group of little collective 
strength, throwing the greatest influence in the direction of the subordi- 
nate with whom the department head happened to talk last. It must be 
doubted whether there is a single "best way" of organizing and using the 
"men behind the throne." The decisive factor will often be the working 
habits of the top executive. In such small groups, of course, it is highly 
advantageous that each individual member consciously complement the 
abilities and inclinations of the other members. The greatest peril lies 
in the possibility that the convenience of harmony reduces the group's ca- 
pacity for criticism; after all, life is much more agreeable when one can 
roll along under the momentum supplied by the strongest personality. It 
is also obvious that much tact and ingenuity is required of each member 
of the group in minimizing the importance of his informal function in 
his dealings with the hierarchy itself, and in respecting openly all the 
proprieties of internal authority. 

The Personal Secretary. Throughout the administrative hierarchy, indi- 
vidual key men would in most instances cut sorry figures were it not for 
the untiring assistance they receive from their personal secretaries. As the 
housekeeper of the administrative estate of her boss, the personal secretary 
may feel herself to be part of the structure of authority. Outside the insti- 
tutional province of her boss, her importance is frequently underrated; 
inside she may be treated like a queen. Her responsibilities reflect those of 
the boss; and within certain limitations she may even act as his alter ego. 
As the stenographic manual of one federal agency explains: 

To be a real help to the executive, she must know how he would like 
to have a task performed and do it that way. She must be alert to grasp 
situations and draw sound conclusions, to take into consideration more 
than meets the eye or the ear. She must be able to follow the wishes of 
her chief, even to anticipate them. 

. . . The "thinking secretary" proves her ability to take responsibility; 
to express initiative, originality, and resourcefulness. This thoughtful 



310 INFORMAL ORGANIZATION 

attitude is the basis for judgment, which is essential in tempering all 
other traits. 

An extremely important point for the secretary to remember is that 
she represents both her chief and the agency to callers, in person and over 
the telephone. She must put herself in her chief's place and convey the 
impression and the information as he would have her do it. ... Besides 
a thorough knowledge of the facts in the case, this often requires cour- 
tesy and tact. Since the executive and his secretary function interde- 
pendently, it is particularly important that they have a complete 
understanding about telephone practices so that all calls will be taken 
care of adequately in a manner appropriate to the agency. The secretary 
must see that all calls are followed through to completion or returned 
promptly, as dictated by courtesy. 

The secretary must become skillful in taking interruptions herself and 
in interrupting others. She must determine when something is suf- 
ficiently important or urgent to justify interrupting her chief at a con- 
ference and the method by which she will convey the message to him, 
remembering that she interrupts not only her chief but others as well. 

Because the boss himself generally occupies a dual position as an ex- 
ponent of the official hierarchy and as a member of one or more informal 
organizations, his personal secretary must extend her activities in these same 
different directions. Her main stock in trade is knowledge of things that 
only her boss knows. Only she can tell where he is at the moment, whether 
he may be accessible "for a few minutes" during the next few hours, 
where the memorandum now is that was sent up to him day before yester- 
day, what matters are still on his desk, what disposition he is likely to make 
of each matter. In giving information of this kind, in arranging the list of 
callers and conferences, in adjusting priority among appointments as 
urgencies change, in drawing the attention of her boss to items that have 
passed from his mind in all of her activities she must be thoroughly cog- 
nizant of the specific character of the relationship between him and others. 

She must have a sure sense of differentiation; some demands on the time 
of her boss need to be rebuffed, while on others she will yield with ease. 
Members of his own personal organization may share with her confidential 
information that she would never think of disclosing to any one except 
other members of the personal organization. Indeed, she may become the 
manager of the agenda for this personal organization. She must make it her 
business to hear and to see drawing even from the gossip of the office 
and the cafeteria hints and suggestions of profit to her boss. Through her 
contacts with other secretaries, she may become a special channel of intelli- 
gence to other kinds of informal organization. 

Small wonder that the personal secretary will often know her boss better 
than docs his wife. He may find it of benefit to pose to her administrative 
problems to which he has no ready answer. He may leave her a great deal 
of discretion in handling particular matters with his subordinates. He will 
feel hopelessly stranded when a cold keeps her from the office. Others 



INFORMAL ORGANIZATION 311 

working for him will soon learn the importance of approaching him 
through her. They will also respect her as an astute judge of their stake 
in any given matter. They will try to gain her favor, but she would not be 
able to conduct her business with full efficiency if she proved an easy 
victim of flattery. 

The Invincible Constellation. In our discussion of informal groupings 
we have noticed time and again the extent to which in administrative insti- 
tutions as in all large-scale enterprise 10 the hierarchical order of authority 
is modified by the factor of personal standing within the organization. This 
is true also within the hierarchy itself. There are everywhere individuals on 
a relatively lower level of authority who "count" and thus overshadow 
others on a higher level of authority. For example, a ranking staff officer 
may belong to the department head's official cabinet, and yet he may not 
"count." Or a line executive may be entitled to all the vestments of 
seniority, and yet he knows that his opinions and proposals find no takers 
unless they are endorsed by some one who does "count." Conversely, those 
within a department who are familiar with the structure of informal organi- 
zation will be able to point to four or five unadvertised officials whose 
agreement on any matter is tantamount to a departmental decision. 
Those are the few one has to see in order to get action the "invincible 
constellation." 

The informal status of the members of this cardinal group may have 
quite different foundations. One may be a central figure in the top execu- 
tive's personal organization. Another may be the action-man among those 
"behind the throne." No less often will membership in the "invincible 
constellation" rest on a firmly established reputation for soundness in judging 
the feasibility and efficacy of proposed action. This is sometimes a matter 
of breadth of appreciation of all the factors that may affect specific meas- 
ures an attribute of precise thinking and rich experience. Equally often 
such reputation may simply stem from the fact that luckily previous judg- 
ments have usually proved right rather than wrong. Whatever the source 
of the glory of infallibility, the fact remains that the initials of these four 



10 Study of informal organization is still in its infancy. Valuable insights were furnished 
indirectly by Bentley, op. cit. above in note 8. More specific materials can be found in 
Mayo, Elton, Human Problems of an Industrial Civilization, New York: Macmillan, 1933; 
Barnard, Chester I., The Functions of the Executive, Cambridge: Harvard University Press, 
1938, rcpublished 1945; Tead, Ordway, Human Nature and Management, New York: 
McGraw-Hill, 1933, and Democratic Administration, New York: Association Press, 1945. 
O particular value is Rocthlisbergcr and Dickson, op. cit. above in note 6. See also Mayo, 
Elton and Others, Teamwork^ and Labor Turnover in the Aircraft Industry of Southern Cali- 
fornia, Boston: Harvard University Press, 1944; Rocthlisbergcr, Fritz J., Management and 
Morale, Cambridge: Harvard University Press, 1941; Gardner, Burlcigh B., Human Relations 
in Industry, Chicago: Irvin, 1945. Relationships between informal organization and super- 
vision are suggested by Bradford, L. P. and Lippitt, Ronald, "Building a Democratic Work 
Group," Personnel, 1945, Vol. 22, p. 142 ff. The implications of unionization for informal 
organization arc touched upon by Bakke, E. Wight, "Why Workers Join Unions,*' ibid., p. 
37 ff. 



312 INFORMAL ORGANIZATION 

or five officials at the bottom of action papers seem to have a magic effect. 

Of course, the "invincible constellation" may conceivably meet defeat at 
any time. However, the prestige of its members will survive occasional de- 
feat if the decision they supported continues to look like the best solution 
in the light of all known circumstances, and if no evidence turns up to 
demonstrate either obvious errors of judgment or inadequate consideration 
of all the factors that should have been taken into account. Their craft 
demands of the members of the "invincible constellation" that they be 
masters in digesting all the necessary basic information. They are bound 
to be men who not only have intimate knowledge of the department and 
its facilities for analysis but also of the outside interests which the decision 
will affect. 

Clubs and Clusters. As in ordinary ward politics, so in the office it often 
pays to be known as a good fellow, and to be active in good fellowship. 
Assume that an important man in the organization loves a weekly night of 
poker and virile conversation, would it not be both a distinction and a 
privilege to be asked to share in the fun? An inexhaustible supply of jokes 
may buy the important man's jovial interest in one's career. "An entertain- 
ing chap," the important man may think; "I ought to see more of him in 
the office." And during poker there are always precious opportunities for 
posting the important man on this or that. Or consider the Indiana Club 
and all its jolly Hoosiers; they have a hard-working program committee, 
but no one minds a discreet business conversation in the corner. Or think 
of the wartime car pool, and how gratifying it was to come to know the 
section chief so intimately. The car pool is no longer, yet its off-the-record 
conversations may remain a regular feature. 

Innocuous and desirable as these groupings are, they are also sources 
of nonhierarchical influence. Illustrations of a somewhat different charac- 
ter may be taken from the annals of quite a few of the quickly recruited 
emergency agencies, especially those of World War II. Intensive solidari- 
ties developed among occupational groups businessmen, professors, lawyers, 
civil servants. Each group tended to see a challenge in the other. Informal 
leadership, if only for purposes of vigilance, found ready support within 
the individual group. In fact, spokesmen discovered it to be to their ad- 
vantage not to be caught in the neutralizing sphere of the official hierarchy, 
where extremist views could not be expressed in freedom. Similar forma- 
tions, based on general outlook rather than on occupation, are by no means 
exceptional in old-line establishments. At times the reformist "Young 
Turks" may have the upper hand, reducing those who are other-minded to 
the role of the "loyal opposition" loyal or not so loyal. No matter how 
frequently the factional position will be reversed, the existence of a "loyal 
opposition" in each case heightens the collective sense of public purpose and 
helps to defeat institutional self-complacency. 

Nor should we forget the "old school tie" in its American version, which 



INFORMAL ORGANIZATION 313 

is considerably less obnoxious than the British prototype. Still, in the ad- 
ministrative staff and auxiliary services we may run into a significant scatter- 
ing of Minnesota men or Chicago men or Syracuse men. 11 Quite naturally, 
they maintain their own system of intercommunication, develop their own 
sign language, and generally look upon one another with fraternal eyes. 
This may even be a necessity when they confront the most honorable federa- 
tion of departmental oldtimers. 

Voice of the Union. The picture would hardly be complete without 
some indication of the place occupied in a department by the local or locals 
of government-employee unions. 12 Unionization has received new impetus 
in recent years, especially among the rank and file. It should be admitted 
at the outset that collective bargaining in the public service must take dif- 
ferent forms as compared with industry, particularly because compensation 
and other phases of the work relationship are ordinarily the subject of gov- 
ernment-wide and even statutory regulation. Nonetheless, a considerable 
field remains for constructive participation of chosen employee representa- 
tives in various aspects of the managerial process. This is true not only of 
grievance procedure and the promotion of employee health, welfare, and 
safety but also of departmental employee relations in general. 

By and large, the working contacts of employee locals have been con- 
fined to the personnel office, instead of fanning out over the organization. 
By and large, too, the nature of these contacts has held the local too much 
to a negative role raising remonstrances in the face of departmental inten- 
tions or actions. That this need not be the case has been demonstrated by 
the more positive approach pursued by such agencies as the Tennessee 
Valley Authority. The ultimate administrative producers are the ordinary 
employees. Work-simplification programs aimed at mass processes, for 
instance, cannot be carried along by first-line supervisors single-handedly. 
Programs of this kind, involving a higher level of general efficiency and 
large potential economies, must enlist every employee. It will not always 
be easy to win the rank and file, but without first settling all conceivable 
questions with their legitimate representatives no appeal for whole-hearted 
cooperation is likely to be successful. 

The leadership of an agency local is an example of nonhierarchicai 
power par excellence. It may be a nightmare to the exponents of the official 
hierarchy. When met with good will and understanding, however, the 
union can be a source of real support. To fight a running battle with the 
local entails grave risks to morale. It also may set off sparks on the legisla- 
tive side, and embarrass the chief executive himself. These considerations 
invite an attitude of give-and-take, even though negotiating the basic terms 
of such give-and-take may be tough business. 

11 Cf. above Ch. 2, "The Study of Public Administration," sec. 3, "Training for Public 
Administration." 

12 Cf. below Ch. 24, "Personnel Standards," sec. 6, "Employee Relations." 



CHAPTER 



Interest Groups in Administration 

1. THE MEANING OF INTEREST REPRESENTATION 

Types of Interest Groups. Public administration operates in an environ- 
ment of interest-group activity. Most of the agencies of government are 
the product of intergroup pressure or conflict, the outcome of which was 
establishment of a governmental body to perform a service or function that 
had been carried out unsatisfactorily or not at all under conditions of private 
initiative. Some of the duties of the oldest federal departments Foreign 
Affairs, Treasury, War included the protection, promotion, or regulation, 
in iMadison's phrase, of "various and interfering interests . . . [which] 
involves the spirit of party and faction in the necessary and ordinary opera- 
tions of the government." Even when a public agency secures a legislative 
mandate to perform a given task without formal relationship to the group 
or class structure of society, citizens affected by that task watch it constantly^ 
and make their views known through some collective organization or agenu 

The variety and scope of interest-group activity defy efforts toward 
simplification. Students of interest-group activity have concentrated on 
describing the organization and activities of specific organizations, and on 
making case studies of agencies and situations in which group pressures 
have molded or modified legislative and administrative policy. 1 The latter 
method succeeds in capturing the richness and vitality of governmental 
experience. Yet it fails to yield satisfactory tools of interpretation and un- 
derstanding. We need more descriptive studies and reports, but we also 
need to develop concepts and methods of understanding the fundamental 

1 Cf. Herring, Pcndleton, Group Representation Before Congress, Washington: Brookings 
Institution, 1929, and Public Administration and the Public Interest, New York: McGraw-Hill, 
1936; Childs, H. L., Labor and Capital in National Politics, New York: Harcourt Brace, 1930; 
Crawford, K., The Pressure Boys, New York: Messncr, 1939; Blaisdell, D. C., Economic 
Power end Political Pressures, Temporary National Economic Committee, Monograph No. 26, 
Washington: Government Printing Office, 1941. 

314 



INTEREST GROUPS IN ADMINISTRATION 



315 



motivation and distinctive behavior patterns of interest groups. 2 A slightly 
revised version of a classification suggested by Charles A. Beard is pre- 
sented below to give some idea of the variety of interest groups, and to 
emphasize the rise of professional and skill groups to challenge the category 
of economic interests that until recently had been presumed to bt 
predominant. 

Major Category of Interest and Basis of 
Organization 

I. ECONOMIC ADVANTAGE 

A. Industry^ commodity, or service 



B. Federation of particular interests 



Group Organization 

A. Trade associations and indus- 
trial institutes, trade unions, 
producer cooperatives 

B. Chamber of Commerce of the 
United States, National Associa- 
tion of Manufacturers, Ameri- 
can Farm Bureau Federation, 
National Farmers Union, Amer- 
ican Federation of Labor, Con- 
gress of Industrial Organizations 

C. Consumers' associations, taxpay- 
ers' leagues 

A. Bar and medical associations, 
public relations counselors, so- 
cial workers, educators 

B. Scientific societies, organizations 
of public officials 

National Catholic Welfare Con- 
ference, Federal Council of 
Churches of Christ in America 

A. Anti-Saloon League, Women's 
Christian Temperance Union 

B. Relief recipients, veterans' or- 
ganizations 

C. Negro, nationality and women's 
organizations 

Interest Orientation of Public Administration. Pressure groups have in 
common a self-regarding singleness of aim which places priority of impor- 
tance upon the immediate purpose or welfare of the group organization as 
such. But administrative agencies are also characterized by a focus of aim 

2 C/. Bentley, A. F., The Process of Government, Chicago: University of Chicago Press, 
1908; Perlman, S., Theory of the Labor Movement, New York: Macmillan, 1928; Jordan, E., 
The Theory of Legislation, Indianapolis: Progress Publishing Co., 1930; Macmahon, A. W., 
'The Mexican Railways under Workers' Administration," Public Administration Review. 
1941, Vol. 1, p. 458 ff.i Chase, S., Democracy Under Pressure. New York: Twentieth Century 
Fund, 1945. 



C. Federation of general interests 

II. SKILL 

A. Profession 



B. Research and communication of 

experience 
III. RELIGION 



IV. REFORM 

A. Moral causes 

B. Improvement of group status 

C. Equalization of opportunity 



316 INTEREST GROUPS IN ADMINISTRATION 

and effort, coupled with a highly developed sense of organizational im- 
portance. A bureaucracy transcends the particularism of pressure groups 
only by the oath of public office and its commitment to the execution of a 
program delegated to it by the political agencies of policy formulation. 
Bureaucratic theory attempts to avoid group pressures by referring them to 
the predetermined legislative policy or to the necessity for rules and regifr 
lations applying generally to all groups and situations. The weakness of 
this formal position is that a bureaucracy is itself part of the structure of 
the community, and the achievement of its specific aim is in large measure 
dependent upon its ability to secure the cooperation and support of other 
group organizations.^ 

If it fails to do so, it loses a valuable opportunity to influence the course 
of policy. And unless it does so, its own powers and organization may be 
modified or abolished by legislation induced by pressure from dissatisfied 
groups or by the legislature's own dissatisfaction with the inability of the 
bureaucracy to transform the relationships between conflicting groups from 
controversy to routine. Administrative agencies must keep foremost loyalty 
to the public purpose entrusted to them. Still, they cannot forget that 
other social groups share in that purpose and have their own notions as 
to how it may best be achieved. The public official may be primarily re- 
sponsible for the formulation of administrative policy, but under demo- 
cratic conditions his responsibility does not make him the sole judge of 
the ends of policy. The wise administrator, therefore, keeps open the 
channels of information and advice between his agency and the private 
organizations concerned with its operation) Indeed, the only question is 
whether these channels should be established on a formal basis or main- 
tained as a matter of informal personal contact. 

Governmentalization of Interest Groups. In countries where the scope 
of governmental responsibility for economic enterprise is much wider than 
has been recognized in the United States, this interdependence of govern- 
mental and economic organization becomes an integral part of the political 
structure. The Russian trade unions and cooperatives, the German chambers 
of industry, and the Italian corporations became in effect decentralized 
operating divisions of the central policy-making agency controlling the 
national economy. 8 In that role, industrial bodies and groups participated 
in the formulation of policy in an administrative rather than a political 
capacity, losing their independence and their opportunity to criticize openly 
and to press for changes in the direction of policy. 

8 C/. Webb, Sidney and Beatrice, Soviet Communism: A New Civilization? New York: 
Longmans, 1936; Bicnstock, Gregory and Others, Management in Russian Industry and Agri- 
culture, London: Oxford University Press, 1944; Sweezy, Maxinc, The Structure of the Nazi 
Economy, Cambridge: Harvard University Press, 1941; International Labor Office, Methods of 
Collaboration Between Public Authorities, Workers' and Employers' Organizations, pt. I, 
Geneva, 1940; Brady, Robert A., Business as a System of Power, New York: Columbia Uni- 
versity Press, 1943. 



INTEREST GROUPS IN ADMINISTRATION 317 

Interest Groups and Class Theory. Returning to a context in which a 
distinction is maintained between private initiative and governmental con- 
trol in economic affairs, we may observe that interest-group activitity in 
general accepts the prevailing structure and process of policy formation. 
It is reformist rather than revolutionary in orientation. Interest groups 
attempt to make public policy the instrument of their aims. Their tech- 
niques include the methods and channels of publicity; withholding or 
offering financial or voting support; sanctions of cooperation or non- 
cooperation; and personal contacts with public officials through innumerable 
channels of social, professional, and official association. 

(Jnterest-group activity is in a category of thought different from the 
Marxist concept of class interest, which presumes an irrepressible conflict 
between the capitalists and the workers. This ideology looks forward to 
the unification of political and economic activity in the name of an authori- 
tative program identified with the interest of the whole people or the 
"classless society.^ Less inclusive group interests are labeled as collabora- 
tionist, diversionist, or reactionary. Believers in the class-interest doctrine 
may engage in pressure-group tactics pending the realization of the classless 
society. However, they do so without a sense of responsibility for the 
immediate effects of policy, for their deeper moral responsibility is for the 
achievement of a different social structure and a new political order of 
ideas, rulers, and institutions. 

Demands for Interest Representation. 'Historically, the class interests of 
property were reflected for hundreds of years in the governmental structure 
and theory of representation underlying policy formation. 4 Since the 
nineteenth century, however, property representation as such has almost 
completely been abolished as a qualification for public office. A partial 
recrudescence of class representation has appeared in recent years. Certain 
group interests, particularly labor organizations, have raised the demand for 
specific representation or participation in the formulation of public policy. 
J As we know, there are always either formal or informal relationships 
between group organizations and official bureaucracies. Furthermore, it 
is perfectly cle^r that in the sense of the right to be heard, to be consulted, 
and to be informed in advance of the tentative basis of emerging policy 
determination, group participation is a fundamental feature of democratic 
legislation and administration. When, therefore, group organizations press 
for representation in the official structure of administration, their desire 
reflects some deeper motivation, whether it be redress of grievances, <fe- 
sire for power, resentment over too limited participation, or fears of insecurity. 

What are the forms and types of interest representation, and the ways 
in which it works? In the following sections three forms will be analyzed, 
and in the final section some suggestions will be presented as to the appro- 
priate conditions and basic assumptions of such interest representation. 

*Cf. Beard, Charles A., The Economic Basis of Politics. New York: Knopf, 1945. 



318 INTEREST GROUPS IN ADMINISTRATION 

2. CLIENTELE ORGANIZATION 

Growth of Clientele Agencies. Interest representation finds expression 
indirectly in the structure of government when an agency is created to 
benefit a special category of citizens, or to promote the welfare of a group 
having some specified interest or attribute in common. The best known 
examples are perhaps the services and financial aids to cxservicemen by 
the Veterans Administration; the research, promotional, and advisory func- 
tions of the Women's Bureau in furthering equal opportunities and non- 
discrimination between wage earners of both sexes; the comparable 
activities and grant-in-aid responsibilities of the Children's Bureau for im- 
proving the health, education, and welfare of mothers and children; the 
regulation and constructive development of Indian life by the Office of 
Indian Affairs. Clientele organization may be contrasted with the more 
common organization by function, in which the agency is established to 
perform a function or service for all categories of citizens, such as a public 
library or a fire department. 

A function may be so defined that, in effect, it is restricted to a major 
industrial or economic group. The Federal Reserve System operates through 
reserve banks whose operations in turn are restricted to banks. The 
Securities and Exchange Commission's jurisdiction is restricted to security 
issuers, traders, and organized exchanges engaged in security transactions. 
The Interstate Commerce Commission dealt for many years solely with the 
railroads and their customers. However, when the administrative function 
is of a regulatory rather than a service or promotional character, the im- 
plication is that two or more adversary interests are involved, one of which 
having by law been accorded priority is represented by the public agency. 
In such cases, the clientele principle is transvalued by clothing the group 
objective wholly or in part with the public interest. This objectification of 
the group interest in public policy characterizes a great deal of modern 
labor and agricultural legislation. 

Disadvantages of Clientele Organization. From the standpoint of 
economy and efficiency, the clientele principle is defective because it allows 
many agencies to perform essentially the same basic function for different 
classes of people. In practice, of course, the principle is not carried to its 
logical extreme. Under modern conditions, the justification for clientele 
agencies is usually based on special circumstances, coupled with a welfare 
motive that assumes the desirability of governmental ministration to the 
needs of an unprotected or underprivileged or unrepresented group. The 
most familiar arguments are that clientele organizatioa is required either 
to redress existing inequalities or inequities in economic and social life, or 
to handle technical problems peculiar to an economic process or to a spe- 
cific class of citizens. In the latter case, the distinction between function 
and clientele loses its meaning, because every functional agency has to 



INTEREST GROUPS IN ADMINISTRATION 319 

define its jurisdiction to include certain classes of people or cases and to ex- 
clude others. However, although clientele agencies may be formally es- 
tablished to perform specified functions, this does not make them functional 
in purpose or scope. 

The crux of the problem of administrative organization turns upon 
the extent to which the agency becomes exclusive, competitive, or self- 
centered in spirit. An agency whose activities are focused and directed 
toward a particular group is likely to be more narrowly centered than one 
established to perform its function impartially for all citizens. Analysis of 
governmental structures will usually reveal, however, some functional agen- 
cies which have a focus of purpose so narrow that they become more ex- 
clusive and self-centered than a clientele agency whose interests range over 
a broader segment of the population or national economy. Form of 
organization, whether functional or clientele, is therefore relative to the 
public purpose rather than to the particular end in itself. No governmental 
agency should be so constituted as to enable a single group to prevent the 
agency from taking the most inclusive view of the public interest in any 
given situation. 5 

Attempts at Internal Balance of Interests. One way of implementing 
such a standard would be to create agencies with so broad a jurisdiction, 
covering so many organized groups, that the interest of no one group could 
be controlling. At first glance this idea would seem to have been followed 
in the creation of such federal departments as Agriculture, Commerce, and 
Labor. The functions of the Department of Agriculture include research, 
information, service, and regulation of processors, distributors, and financiers 
as well as a great variety of commodity producers. The Department of 
Commerce deals with interests represented by hundreds of industrial prod- 
uct and service classifications and associational groupings. The Department 
of Labor's statistical and regulatory functions affect manufacturers as well 
as scores of industrial and craft unions. All this splintering of "interests" 
fails, however, to take account of the pressure influences behind the his- 
torical development of the three departments and of the psychological 
factor that the great federations of agricultural, business, and labor groups 
look upon each department as their spokesman in the highest councils of 
the executive branch. 6 

As long as the large interest groups retain any degree of virility and 
unity, they will expect great weight to be given their views on the appoint- 
ment of top personnel and general policy matters. No government can 
neglect this factor. Indeed, provided the operating and technical levels of 
administration are protected from political interference in appointment or 

6 C/. Brookings Institution, Investigation of Executive Agencies, ch. 2, Senate Doc. No. 
1275, 75th Cong., 1st Sess., Washington, 1937; May, Geoffrey, "Day Dreams of A Bureau- 
crat," Public Administration Review, 1945, Vol. 5, p. 154. 

6 For a general discussion, see Short, L. M., The Development of National Administrative 
Orfanization, Baltimore: Johns Hopkins Press, 1923. 



320 INTEREST GROUPS IN ADMINISTRATION 

removal of personnel and in the handling of business, it seems at least 
arguable whether the political heads of these departments could not be ap- 
pointed as representatives of farmers, businessmen, or wage earners. Aside 
from a broader public interest, the problem at this level raises another 
issue, namely, the need of the chief executive for a department head and 
adviser in whom he has complete confidence, while a group representative 
by definition has another primary loyalty. The dilemma is not insurmount- 
able, but it requires a rare combination of ability, integrity, and flexibility 
to serve in something like a dual capacity. 

Functions of Clientele Agencies. The functions most often delegated 
to a clientele agency 7 are of a service character: research and exchange of 
information. The systematic reports and studies of the agency are used by 
the clientele group or by other groups to press for desired legislation or 
changes in administrative policy. Another function is the formulation of 
standards, whether of equity and health as in the employment of women 
and children or for the protection of criteria of competence and training 
to be applied by state professional and trade examining boards. In the 
latter case, the standards are authoritative rather than advisory. They 
raise the question of formal delegation of rule-making power to private 
groups, since such boards are usually composed of representatives of the 
professional or trade groups that are seeking state regulation of admission 
to the profession or trade. 8 Inevitably, the standards established have an 
economic effect in limiting the number of those admitted to the profession 
or trade. However, delegation of this power to private associations has 
been justified by courts and legislatures because technical and specialized 
training cannot be maintained without rigorous tests of proficiency. 

Generally speaking, the endowment of clientele agencies with regulatory 
responsibilities runs counter to deeply felt ideas of equity and fairness. The 
assumption prevails that an agency responsible for promoting the welfare 
of a particular group or class of citizens cannot be expected to maintain 
judicial attitudes of impartiality in a dispute involving an interest adversary 
to that which the agency is supposed to protect or promote. This is one of 
the outstanding reasons for the creation of independent regulatory commis- 
sions outside the structure of the executive departments. The objection 
can be disposed of technically by protecting the regulatory tribunal, wher- 
ever it be located, from political or other interference in the handling of 
its cases. The Department of Agriculture, for instance, has many regula- 
tory duties which are administered by single-headed bureaus fairly and 

7 The Office of Indian Affairs in the Department of the Interior presents a special case 
because it performs practically all governmental functions in the areas placed under its juris- 
diction. Cf. Meriam, Lewis, The Administration of Indian Affairs, Washington: Brookings 
Institution, 1928. 

8 The legal questions are discussed by Jaffe, L. L., "Law Making by Private Groups," 
Harvard Law Review, 1937, Vol. 51, p. 201 ff. See generally Carr Saunders, A. M. and 
Wilson, P. A., The Professions, London: Oxford University Press, 1933. 



INTEREST GROUPS IN ADMINISTRATION 321 

equitably enough to pass the test of judicial scrutiny by the Supreme Court. 9 
Organizational independence has retained its strength as a symbol of 
fairness in most areas of federal regulatory administration. 

Experiences of the Great Depression and World War II. Emergency 
legislation to meet conditions of economic depression, such as the National 
Industrial Recovery Act of 1933 and the mobilization of industry and agri- 
culture in World War II, resulted in a mushroom growth of clientele 
agencies. The hundreds of NRA code authorities, hailed at the beginning 
of the New Deal as experiments in industrial self-government, were later 
vilified as promoting monopolies and enabling minority groups to legislate 
for their private ends. 10 But the mood was passing. Faced with the exi- 
gencies of defense and war production programs, the Office of Production 
Management and subsequently the War Production Board, the Office of 
Price Administration, the War Food Administration, the Office of Defense 
Transportation and the Petroleum Administration for War all developed 
an organization based upon industrial processes or commodity groupings, 
and in many cases staffed by men drawn from the ranks of the industries 
concerned. 

With the exception of the ODT and PAW, the main pattern of organi- 
zation was one of function and process for example, production and 
materials controls, price and rationing controls, food production and dis- 
tribution. However, the industry and commodity divisions played a prom- 
inent role in formulating limitation and allocation orders or price and 
marketing regulations, in handling priority applications, and in collecting 
and analyzing statistical information. In the fields of petroleum production 
and distribution and of railroad transportation, the agencies were frankly 
constituted and staffed on an industry basis. Although headed in each 
instance by a public official responsible to the President, they relied pri- 
marily upon industry initiative and cooperation in developing and carrying 
out the changes in business practices necessary to meet wartime require- 
ments. 

In short, it was recognized that our normal governmental machinery 
and personnel had to be supplemented to meet the demands of war; that 
over-all policies and controls should not be delegated in toto to the broadest 
industrial groupings; and that a basis of organization had to be evolved 
that would conduce to maintaining contacts with the regulated groups, 
securing their advice and active cooperation, giving them prominence in 
announcing and promulgating administrative policies and regulations, and 
enlisting them for much of the routine work of administration. The con- 
flicts of policy between the agencies built on industry or clientele and the 
9 C/. Kitchen, C. W., "Regulatory Procedures in Agricultural Marketing and Food Dis- 
tribution," in the symposium entitled Lectures on Administrative Regulation, Washington: 
Department of Agriculture Graduate School, 1945. 

10 C/. Lyon, L. S. and Others, The National Recovery Administration, Washington: 
Brookings Institution, 1935. 



322 INTEREST GROUPS IN ADMINISTRATION 

functional agencies of control above them, like the Office of War Mobili- 
zation, yield some classic case studies in administration. It is probable, 
however, that these conflicts reflected bottlenecks or divergencies in pro- 
duction programs that would have plagued the war effort in any event 
regardless of organizational forms. 

Two general observations stand out. First, any agency which seeks 
special treatment, privilege, or protection for particular groups deprives 
itself of a justifiable claim to the administrative responsibility for executing 
more inclusive general policies of government. Second, while in special 
cases a group purpose may be identified with the general welfare and with 
statutory policy, the primary concern of any organized group is with the 
naming of administrative top personnel and the content of policy, 

3. STAFFING FOR POINT OF VIEW 

Grounds for Interest Representation. The question may be asked 
whether it is possible to distinguish between the content or substance of ad- 
ministrative policies and the officers who are responsible for policy making. 
In the process of policy formulation, the substance of decisions reached 
is extremely difficult to dissociate from the personalities and social attitudes 
of those participating. The "organization product" is rarely an individual 
idea. It is usually the fruit of a great deal of preliminary discussion and 
informal memoranda. Ultimately it turns out in the form of a letter, state- 
ment, message, or order which has been reviewed and initialed by repre- 
sentatives of many different parts of the organization. 11 Realizing the 
relatively indeterminate character of administrative policy-making and the 
importance of participation in the developmental stages, some interest groups 
particularly labor organizations have requested representation in admin- 
istration on three grounds: first, that such group representation is desirable 
to equalize opportunities for protecting and safeguarding respective inter- 
ests; second, that organized groups can make contributions of special 
knowledge and experience which would not otherwise be available to public 
agencies; and third, that group participation in policy formulation makes 
possible the avoidance of mistakes and the integration of diverse viewpoints 
in advance of formal action on policy proposals. 

Before discussing the different forms that group representation may take, 
we should say that there is a practical difference between demands for 
representation that arise from distrust of the administrative top personnel 
and demands for changes in agency rules or policies. Administrators may 
isolate themselves from leaders and currents of group opinion. But by 
doing so, they lose a valuable opportunity for developing mutual respect 
and confidence that may be gained through continued formal or informal 
contacts with outside interests. Self-isolation interferes with the all-im- 

11 Cf. Appleby, Paul H., Big Democracy, ch. 8: "Wanted: An Organization Product,'* New 
York: Knopf, 1945. 



INTEREST GROUPS IN ADMINISTRATION 323 

portant impression of fairness the public conviction that decisions are 
made only after full investigation and consideration of the facts, which in- 
cludes taking into account the positions and viewpoints of group spokesmen. 
Such institutionalized contacts and the application of elementary principles 
of judicious procedure can go far to protect administrators from charges 
of bias, unfamiliarity with their job, inside manipulation, and "politics" 
in making decisons. 

Demands for group representation that are motivated by a desire to in- 
fluence policy can be met in a variety of ways. Members of regulatory 
boards and commissions are usually prohibited from having any financial 
interest in concerns to be regulated and from engaging in any other voca- 
tion, trade, or employment. In such agencies, the demands and views of 
affected groups are expected to be considered through legal procedures of 
investigation and notice and through opportunity for hearing prior to a 
formal decision, regulation, or order. A more direct device which will be 
considered in the next section is the appointment of a representative ad- 
ministrative board whose members are nominated by interest groups. A 
third technique is the appointment of administrative personnel on grounds 
of special vocational experience or affiliation. One form of this device is the 
creation of a special staff unit to maintain contacts with outside groups and 
to present their grievances, claims, or suggestions to the appropriate officials. 

Administrative Appointment of Interest Representatives. The appoint- 
ment of individuals to public office because of group affiliation squarely 
conflicts with the civil service concept of appointment by virtue of merit 
established by competitive examination. Fortunate