Mises Daily Articles
[The Man versus the State (1892)]
Officialism is habitually slow. When nongovernmental agencies are dilatory, the public has its remedy: it ceases to employ them and soon finds quicker ones. Under this discipline all private bodies are taught promptness. But for delays in state departments there is no such easy cure. Lifelong Chancery suits must be patiently borne; museum catalogs must be wearily waited for.
While, by the people themselves, a crystal palace is designed, erected, and filled in the course of a few months, the legislature takes 20 years to build itself a new house. While, by private persons, the debates are daily printed and dispersed over the kingdom within a few hours of their utterance, the Board of Trade tables are regularly published a month, and sometimes more, after date. And so throughout.
Here is a Board of Health which, since 1849, has been about to close the metropolitan graveyards, but has not done it yet — and which has so long dawdled over projects for cemeteries that the London Necropolis Company has taken the matter out of its hands. Here is a patentee who has had 14 years' correspondence with the Horse Guards, before getting a definite answer respecting the use of his improved boot for the army. Here is a Plymouth port admiral who delays sending out to look for the missing boats of the Amazon until ten days after the wreck.
Again, officialism is stupid. Under the natural course of things each citizen tends toward his fittest function. Those who are competent to the kind of work they undertake succeed and, in the average of cases, are advanced in proportion to their efficiency; while the incompetent, society soon finds out, ceases to employ, forces to try something easier, and eventually turns to use.
But it is quite otherwise in state organizations. Here, as everyone knows, birth, age, backstairs intrigue, and sycophancy determine the selections, rather than merit. The "fool of the family" readily finds a place in the Church, if "the family" have good connections. A youth too ill-educated for any profession does very well for an officer in the army. Grey hair, or a title, is a far better guarantee of naval promotion than genius is. Nay, indeed, the man of capacity often finds that, in government offices, superiority is a hindrance — that his chiefs hate to be pestered with his proposed improvements and are offended by his implied criticisms.
Not only, therefore, is legislative machinery complex, but it is made of inferior materials. Hence the blunders we daily read of; the supplying to the dockyards from the royal forests of timber unfit for use; the administration of relief during the Irish famine in such a manner as to draw laborers from the field, and diminish the subsequent harvest by one-fourth; the filing of patents at three different offices and keeping an index at none. Everywhere does this bungling show itself, from the elaborate failure of House of Commons ventilation down to the publication of The London Gazette, which invariably comes out wrongly folded.
A further characteristic of officialism is its extravagance. In its chief departments, army, navy, and Church, it employs far more officers than are needful, and pays some of the useless ones exorbitantly. The work done by the Sewers Commission has cost, as Sir B. Hall tells us, from 300 to 400 percent over the contemplated outlay; while the management charges have reached 35, 40, and 45 percent, on the expenditure. The trustees of Ramsgate Harbor — a harbor, by the way, that has taken a century to complete — are spending £18,000 a year in doing what £5,000 has been proved sufficient for. The Board of Health is causing new surveys to be made of all the towns under its control — a proceeding which, as Mr. Stephenson states, and as every tyro in engineering knows, is, for drainage purposes, a wholly needless expense. These public agencies are subject to no such influence as that which obliges private enterprise to be economical.
Traders and mercantile bodies succeed by serving society cheaply. Such of them as cannot do this are continually supplanted by those who can. They cannot saddle the nation with the results of their extravagance, and so are prevented from being extravagant. On works that are to return a profit it does not answer to spend 48 percent of the capital in superintendence, as in the engineering department of the Indian Government; and Indian railway companies, knowing this, manage to keep their superintendence charges within 8 percent. A shopkeeper leaves out of his accounts no item analogous to that £6,000,000 of its revenues which Parliament allows to be deducted on the way to the Exchequer. Walk through a manufactory, and you see that the stern alternatives — carefulness or ruin — dictate the saving of every penny; visit one of the national dockyards, and the comments you make on any glaring wastefulness are carelessly met by the slang phrase, "Nunky pays."
The unadaptiveness of officialism is another of its vices. Unlike private enterprise, which quickly modifies its actions to meet emergencies; unlike the shopkeeper who promptly finds the wherewithal to satisfy a sudden demand; unlike the railway company which doubles its trains to carry a special influx of passengers; the law-made instrumentality lumbers on under all varieties of circumstances through its ordained routine at its habitual rate. By its very nature it is fitted only for average requirements, and inevitably fails under unusual requirements.
You cannot step into the street without having the contrast thrust upon you. Is it summer? You see the water-carts going their prescribed rounds with scarcely any regard to the needs of the weather — today sprinkling afresh the already moist roads; tomorrow bestowing their showers with no greater liberality upon roads cloudy with dust. Is it winter? You see the scavengers do not vary in number and activity according to the quantity of mud; and if there comes a heavy fall of snow, you find the thoroughfares remaining for nearly a week in a scarcely passable state, without an effort being made, even in the heart of London, to meet the exigency.
The late snowstorm, indeed, supplied a neat antithesis between the two orders of agencies in the effects it respectively produced on omnibuses and cabs. Not being under a law-fixed tariff, the omnibuses put on extra horses and raised their fares. The cabs, on the contrary, being limited in their charges by an Act of Parliament which, with the usual shortsightedness, never contemplated such a contingency as this, declined to ply, deserted the stands and the stations, left luckless travelers to stumble home with their luggage as best they might, and so became useless at the very time of all others when they were most wanted!
Not only by its unsusceptibility of adjustment does officialism entail serious inconveniences, but it likewise entails great injustices. In this case of cabs, for example, it has resulted since the late change of law, that old cabs, which were before salable at £10 and £12 each, are now unsaleable and have to be broken up; and thus legislation has robbed cab proprietors of part of their capital.
Again, the recently passed Smoke Bill for London, which applies only within certain prescribed limits, has the effect of taxing one manufacturer while leaving untaxed his competitor working within a quarter of a mile; and so, as we are credibly informed, gives one an advantage of £1,500 a year over another. These typify the infinity of wrongs, varying in degrees of hardship, which legal regulations necessarily involve. Society, a living, growing organism, placed within apparatuses of dead, rigid, mechanical formulas, cannot fail to be hampered and pinched. The only agencies which can efficiently serve it are those through which its pulsations hourly flow, and which change as it changes.
How invariably officialism becomes corrupt everyone knows. Exposed to no such antiseptic as free competition — not dependent for existence, as private unendowed organizations are, on the maintenance of a vigorous vitality; all law-made agencies fall into an inert, overfed state, from which to disease is a short step. Salaries flow in irrespective of the activity with which duty is performed; continue after duty wholly ceases; become rich prizes for the idle wellborn; and prompt to perjury, to bribery, to simony.
East India directors are elected not for any administrative capacity they have; but they buy votes by promised patronage — a patronage alike asked and given in utter disregard of the welfare of 100 million people. Registrars of wills not only get many thousands a year each for doing work which their miserably paid deputies leave half done; but they, in some cases, defraud the revenue — and that after repeated reprimands. Dockyard promotion is the result not of efficient services, but of political favoritism.
That they may continue to hold rich livings, clergymen preach what they do not believe; bishops make false returns of their revenues; and at their elections to fellowships, well-to-do priests severally make oath that they are pauper, pius et doctus. From the local inspector whose eyes are shut to an abuse by a contractor's present, up to the prime minister who finds lucrative berths for his relations, this venality is daily illustrated; and that in spite of public reprobation and perpetual attempts to prevent it. As we once heard said by a state official of 25 years' standing, "Wherever there is government there is villainy."
It is the inevitable result of destroying the direct connection between the profit obtained and the work performed. No incompetent person hopes, by offering a douceur in the Times, to get a permanent place in a mercantile office. But where, as under government, there is no employer's self-interest to forbid — where the appointment is made by someone on whom inefficiency entails no loss — there a douceur is operative. In hospitals, in public charities, in endowed schools, in all social agencies in which duty done and income gained do not go hand in hand, the like corruption is found — and is great in proportion as the dependence of income upon duty is remote. In state organizations, therefore, corruption is unavoidable. In trading organizations it rarely makes its appearance, and when it does, the instinct of self-preservation soon provides a remedy.
To all which broad contrasts add this, that while private bodies are enterprising and progressive, public bodies are unchanging, and, indeed, obstructive. That officialism should be inventive nobody expects. That it should go out of its easy mechanical routine to introduce improvements, and this at a considerable expense of thought and application, without the prospect of profit, is not to be supposed. But it is not simply stationary; it resists every amendment either in itself or in anything with which it deals.
Until now that county courts are taking away their practice, all agents of the law have doggedly opposed law reform. The universities have maintained an old curriculum for centuries after it ceased to be fit; and are now struggling to prevent a threatened reconstruction. Every postal improvement has been vehemently protested against by the postal authorities. Mr. Whiston can say how pertinacious is the conservatism of Church grammar schools. Not even the gravest consequences in view preclude official resistance: witness the fact that though, as already mentioned, Professor Barlow reported in 1820, of the Admiralty compasses then in store, that "at least one-half were mere lumber," yet notwithstanding the constant risk of shipwrecks thence arising, "very little amelioration in this state of things appears to have taken place until 1838 to 1840."
Nor is official obstructiveness to be readily overborne even by a powerful public opinion: witness the fact that though, for generations, nine-tenths of the nation have disapproved this ecclesiastical system which pampers the drones and starves the workers, and though commissions have been appointed to rectify it, it still remains substantially as it was: witness again the fact that though, since 1818, there have been a score of attempts to rectify the scandalous maladministration of charitable trusts — though ten times in ten successive years remedial measures have been brought before Parliament — the abuses still continue in all their grossness. Not only do these legal instrumentalities resist reforms in themselves, but they hinder reforms in other things. In defending their vested interests the clergy delay the closing of town burial-grounds.
As Mr. Lindsay can show, government emigration-agents are checking the use of iron for sailing-vessels. Excise officers prevent improvements in the processes they have to overlook. That organic conservatism which is visible in the daily conduct of all men is an obstacle which in private life self-interest slowly overcomes. The prospect of profit does, in the end, teach farmers that deep draining is good; though it takes long to do this. Manufacturers do, ultimately, learn the most economical speed at which to work their steam-engines; though precedent has long misled them. But in the public service, where there is no self-interest to overcome it, this conservatism exerts its full force; and produces results alike disastrous and absurd. For generations after bookkeeping had become universal the Exchequer accounts were kept by notches cut on sticks. In the estimates for the current year appears the item, "Trimming the oil-lamps at the Horse-Guards."
Between these law-made agencies and the spontaneously formed ones, who then can hesitate? The one class are slow, stupid, extravagant, unadaptive, corrupt, and obstructive: can any point out in the other, vices that balance these?
It is true that trade has its dishonesties, speculation its follies. These are evils inevitably entailed by the existing imperfections of humanity. It is equally true, however, that these imperfections of humanity are shared by state functionaries; and that being unchecked in them by the same stern discipline, they grow to far worse results. Given a race of men having a certain proclivity to misconduct, and the question is whether a society of these men shall be so organized that ill conduct directly brings punishment, or whether it shall be so organized that punishment is but remotely contingent on ill conduct? Which will be the most healthful community — that in which agents who perform their functions badly immediately suffer by the withdrawal of public patronage, or that in which such agents can be made to suffer only through an apparatus of meetings, petitions, polling-booths, parliamentary divisions, cabinet-councils, and red-tape documents?
Is it not an absurdly utopian hope that men will behave better when correction is far removed and uncertain than when it is near at hand and inevitable? Yet this is the hope which most political schemers unconsciously cherish. Listen to their plans, and you find that just what they propose to have done, they assume the appointed agents will do. That functionaries are trustworthy is their first postulate. Doubtless could good officers be ensured, much might be said for officialism; just as despotism would have its advantages could we ensure a good despot.
If, however, we would duly appreciate the contrast between the artificial modes and the natural modes of achieving social desiderata, we must look not only at the vices of the one but at the virtues of the other. These are many and important. Consider first how immediately every private enterprise is dependent on the need for it, and how impossible it is for it to continue if there be no need. Daily are new trades and new companies established. If they subserve some existing public want, they take root and grow. If they do not, they die of inanition. It needs no agitation, no act of Parliament, to put them down. As with all natural organizations, if there is no function for them no nutriment comes to them, and they dwindle away.
Moreover, not only do the new agencies disappear if they are superfluous, but the old ones cease to be when they have done their work. Unlike public instrumentalities; unlike heralds' offices, which are maintained for ages after heraldry has lost all value; unlike ecclesiastical courts, which continue to flourish for generations after they have become an abomination; these private instrumentalities dissolve when they become needless. A widely ramified coaching system ceases to exist as soon as a more efficient railway system comes into being. And not simply does it cease to exist, and to abstract funds, but the materials of which it was made are absorbed and turned to use. Coachmen, guards, and the rest, are employed to profit elsewhere, and do not continue for 20 years a burden, like the compensated officials of some abolished department of the state.
Consider, again, how necessarily these unordained agencies fit themselves to their work. It is a law of all organized things that efficiency presupposes apprenticeship. Not only is it true that the young merchant must begin by carrying letters to the post, that the way to be a successful innkeeper is to commence as waiter; not only is it true that in the development of the intellect there must come first the perceptions of identity and duality, next of number, and that without these, arithmetic, algebra, and the infinitesimal calculus, remain impracticable; but it is true that there is no part of an organism but begins in some simple form with some insignificant function, and passes to its final stage through successive phases of complexity. Every heart is at first a mere pulsatile sac; every brain begins as a slight enlargement of the spinal cord.
This law equally extends to the social organism. An instrumentality that is to work well must not be designed and suddenly put together by legislators, but must grow gradually from a germ; each successive addition must be tried and proved good by experience before another addition is made; and by this tentative process only can an efficient instrumentality be produced. From a trustworthy man who receives deposits of money insensibly grows up a vast banking system with its notes, checks, bills, its complex transactions, and its clearing house.
Packhorses, then wagons, then coaches, then steam carriages on common roads, and, finally, steam carriages on roads made for them — such has been the slow genesis of our present means of communication. Not a trade in the directory but has formed itself an apparatus of manufacturers, brokers, travelers, and retailers in so gradual a way that no one can trace the steps. And so with organizations of another order. The Zoological Gardens began as the private collection of a few naturalists. The best working-class school known — that at Price's factory — commenced with half-a-dozen boys sitting among the candle boxes, after hours, to teach themselves writing with worn-out pens.
Mark, too, that as a consequence of their mode of growth, these spontaneously formed agencies expand to any extent required. The same stimulus which brought them into being makes them send their ramifications wherever they are needed. But supply does not thus readily follow demand in governmental agencies. Appoint a board and a staff, fix their duties, and let the apparatus have a generation or two to consolidate, and you cannot get it to fulfill larger requirements without some Act of Parliament obtained only after long delay and difficulty.
Were there space, much more might be said upon the superiority of what naturalists would call the exogenous order of institutions over the endogenous one. But, from the point of view indicated, the further contrasts between their characteristics will be sufficiently visible.
Hence then the fact that while the one order of means is ever failing, making worse, or producing more evils than it cures, the other order of means is ever succeeding, ever improving. Strong as it looks at the outset, state agency perpetually disappoints everyone. Puny as are its first stages, private effort daily achieves results that astound the world. It is not only that joint-stock companies do so much; it is not only that by them a whole kingdom is covered with railways in the same time that it takes the Admiralty to build a hundred-gun ship; but it is that public instrumentalities are outdone even by individuals. The often quoted contrast between the Academy whose forty members took 56 years to compile the French dictionary, while Dr. Johnson alone compiled the English one in eight — a contrast still marked enough after making due set-off for the difference in the works — is by no means without parallel.
That great sanitary desideratum — the bringing of the New River to London — which the wealthiest corporation in the world attempted and failed, Sir Hugh Myddleton achieved single-handed. The first canal in England — a work of which government might have been thought the fit projector, and the only competent executor — was undertaken and finished as the private speculation of one man, the Duke of Bridgewater.
By his own unaided exertions, William Smith completed that great achievement, the geological map of Great Britain; meanwhile, the Ordnance Survey — a very accurate and elaborate one, it is true — has already occupied a large staff for some two generations, and will not be completed before the lapse of another.
Howard and the prisons of Europe; Bianconi and Irish traveling; Waghorn and the Overland route; Dargan and the Dublin Exhibition — do not these suggest startling contrasts? While private gentlemen like Mr. Denison build model lodging houses in which the deaths are greatly below the average, the state builds barracks in which the deaths are greatly above the average, even of the much-pitied town populations; barracks which, though filled with picked men under medical supervision, show an annual mortality per thousand of 13.6, 17.9 and even 20.4; though among civilians of the same age in the same places, the mortality per thousand is but 11.9.
While the state has laid out large sums at Parkhurst in the effort to reform juvenile criminals, who are not reformed, Mr. Ellis takes 15 of the worst young thieves in London — thieves considered by the police irreclaimable — and reforms them all. Side by side with the Emigration Board, under whose management hundreds die of fever from close packing, and under whose license sail vessels which, like the Washington, are the homes of fraud, brutality, tyranny, and obscenity, stands Mrs. Chisholm's Family Colonization Loan Society, which does not provide worse accommodation than ever before but much better; which does not demoralize by promiscuous crowding but improves by mild discipline; which does not pauperize by charity but encourages providence; which does not increase our taxes, but is self-supporting. Here are lessons for the lovers of legislation. The State outdone by a working shoemaker! The State beaten by a woman!
Stronger still becomes this contrast between the results of public action and private action when we remember that the one is constantly eked out by the other, even in doing the things unavoidably left to it. Passing over military and naval departments, in which much is done by contractors and not by men receiving government pay — passing over the Church, which is constantly extended not by law but by voluntary effort — passing over the universities, where the efficient teaching is given not by the appointed officers but by private tutors; let us look at the mode in which our judicial system is worked.
Lawyers perpetually tell us that codification is impossible; and some are simple enough to believe them. Merely remarking, in passing, that what government and all its employees cannot do for the Acts of Parliament in general, was done for the 1,500 customs acts in 1825 by the energy of one man — Mr. Deacon Hume — let us see how the absence of a digested system of law is made good. In preparing themselves for the bar, and finally the bench, law-students, by years of research, have to gain an acquaintance with this vast mass of unorganized legislation; and that organization which it is held impossible for the state to effect, it is held possible (sly sarcasm on the state!) for each student to effect for himself. Every judge can privately codify, though "united wisdom" cannot. But how is each judge enabled to codify? By the private enterprise of men who have prepared the way for him; by the partial codifications of Blackstone, Coke, and others; by the digests of partnership law, bankruptcy law, law of patents, laws affecting women, and the rest that daily issue from the press; by abstracts of cases, and volumes of reports — every one of them unofficial products. Sweep away all these fractional codifications made by individuals, and the state would be in utter ignorance of its own laws! Had not the bunglings of legislators been made good by private enterprise, the administration of justice would have been impossible!
Where, then, is the warrant for the constantly proposed extensions of legislative action? If, as we have seen in a large class of cases, government measures do not remedy the evils they aim at; if, in another large class, they make these evils worse instead of remedying them; and if, in a third large class, while curing some evils they entail others, and often greater ones; if, as we lately saw, public action is continually outdone in efficiency by private action; and if, as just shown, private action is obliged to make up for the shortcomings of public action, even in fulfilling the vital functions of the state; what reason is there for wishing more public administrations? The advocates of such may claim credit for philanthropy, but not for wisdom; unless wisdom is shown by disregarding experience.