Part IV: Making and Implementing Government Decisions

1. Part IV: Making and Implementing Government Decisions Chapter 10: Decision Making

2. Decision Making and Public Administration • Herbert Simon (1945): “a theory of administration should be concerned with the processes of decision as well as with the processes of action.” • Decision making as the quintessential administrative act

3. Goals for Each Approach • Each approach must rectify issues surrounding information and values. • Both information and values constantly intermingle as administrators seek to make decisions.

4. Information • Information is the basic raw material of decisions. • Decision makers must acquire, weigh, and act on the data they collect. • Information is rarely an abstract truth, but rather a matter of interpretation. • Who has the information? How do they and others look at the information?

5. Values • How do political values affect decisions? • Decisions depend on judgments: about the nature of the dilemma, the probabilities of events, and the desirability of consequences. • Decisions require political support from: • The “mass public” • The “attentive publics”: groups that have a salient interest in the agency

6. Decision-Making Approaches • Rational approach: perhaps the classic approach; builds on the work of microeconomists (who seek to explain the behavior of individuals and firms) and holds efficiency as the highest value • Bargaining approach: seeks to maximize political support

7. Decision-Making Approaches (continued) • Participative approach: seeks to improve decisions by intimately involving those affected by them • Public-choice approach: attempts to substitute marketlike forces for other incentives that, its supporters argue, distort decisions

8. Rational Approach • Akin to systems theory, in this approach the decision maker structures the decision-making problem as a system that processes “inputs” to produce “outputs” and seeks to produce the most output for a given level of input.

9. Rational Approach (continued) • Process steps: define goals, identify alternatives, calculate consequences, decide, begin again • Externalities or spillovers: indirect benefits and costs that relate to other goals that the analyst considers when calculating the consequences

10. Example of Rational Approach • Planning-Programming-Budgeting System (PPBS): 1961, Robert McNamara introduced PPBS in Pentagon • Planning: top-level managers developed five-year strategies for defense activities. • Programming: strategies were transformed into detailed descriptions of the department's needs. • Budgeting: officials transformed the program into year-by-year budget requests. • Classic case for rational approach

11. Appraisal of Rational Approach • This approach requires an extraordinary amount of information because decision makers must consider all alternatives, yet this is virtually impossible. • Instead decision makers simplify the process: • They screen out the silly options and restrict themselves to a few major alternatives. • Satisficing (James G. March and Herbert A. Simon): They stop searching when they come upon a satisfactory alternative. • Little may be said about who sets goals.

12. Bargaining Approach • Conduct limited analysis and bargain out a decision that can attract political support. • Incrementalism (Charles Lindblom): limit analysis to a few alternatives instead of trying to judge them all, to weigh one’s values along with the evidence, and to concentrate on the immediate problems to be solved.

13. Example of Bargaining Approach • Cuban missile crisis (1962): Graham Allison found that the bureaucratic-politics perspective offered the best explanation for decision making during the crisis. • Decisions could be understood as resulting from various bargaining games among players in the national government. • Decisions could be understood by examining the perceptions, motivations, positions, power, and maneuvers of the players.

14. Example of Bargaining Approach (continued) • Partisan mutual adjustment: the pulling and hauling among decision makers with different views; offers the best hope for the best decisions. • Regulatory negotiation sessions: to produce better rules and to forestall litigation, these sessions involve the various interests potentially affected by a new rule. • e.g., Environmental Protection Agency holds regulatory negotiation sessions.

15. Appraisal of Bargaining Approach • Dangerously incomplete and risks depriving decision makers of important information • Does not identify most efficient options • Strong in describing how decisions are made and how decision makers build political support for their judgments • Difficult to bargain out differences

16. Participative Approach • Participation can be either consultation for advice or sharing decision-making power • Claims to participation by: • Employees of the organization making the decision • The clientele • Taxpayers • The whole or voting public • NIMBY phenomenon: strong pressures to keep potentially objectionable programs “not in my back yard”

17. Example of Participative Approach • Federal agencies have used advisory committees of private citizens in the decision-making process. • e.g., Trade associations during the New Deal

18. Example of Participative Approach (continued) • Federal agencies have relied on local committees whose part-time members were intended to be representative of their communities. • e.g., Farmers since 1933 have been elected to serve on committees in 3,000 counties. • e.g., In the mid-1960s, federal programs required communities to establish citizen committees in cities to determine money allocation.

19. Appraisal of Participative Approach • Provides wealth of information, sometimes too much • Narrow clientele or broad, mixed clientele? • Participation by all clientele or by committee? • Formal or informal power given to citizens for making government decisions?

20. Public-Choice Approach • Public officials are self-interested, risk avoidant. • Private sector; makes individuals and corporations competitive and leads to most efficient distribution of resources. • Government functions should be either turned over to or handled as in the private sector. • Privatization (Stuart Butler): political guerrilla warfare; directs demand away from government provision of services and reduces demand for budget growth.

21. Example of Public-Choice Approach • Environmental Protection Agency set pollution standards, allowing companies that reduced their pollution below prescribed levels to “bank” their pollution savings for use in future expansion. • Companies since 1979 have been allowed to establish a "bubble" around all of their facilities in a given area and then find the cheapest way to reduce overall pollution within that area.

22. Appraisal of Public-Choice Approach • Efficiency promoted by marketlike competition • Naively believes government bureaucrats are driven so hard to maximize their own utility that organizational goals slip away • Does not explain what government ought to do, just how to do it

23. Limits to Approaches • All approaches share problems: • Uncertainty surrounding complex issues • Bureaucratic pathologies that distort and block the flow of important information • Recurrent crises that deny the luxury of lengthy consideration

24. Limits to Approaches (continued) • Weakness: tendency to focus on a single value • Weakness: failure to understand what is required to make an approach succeed

25. Conclusion • All approaches are expressions of theories and as such have hidden dogmas. • It is possible to identify which approaches work best on which problems.