AL and American Bureaucracy

How well our bureaucratic system protects liberty?  In his book, Bureaucracy, Von Mises outlines his view that administrative agencies are a serious threat to liberty.  Do you agree or disagree?  Are the protections for liberty adequate to answer the concerns of Von Mises?  Do you think there is any merit to Von Mises view of bureaucracy?  Why or Why not? 

Obviously, American bureaucratic system shackles liberty. People are not allowed to do whatever they want. In Mises’ point of view, economically, bureaucracy restricts the motivation of private enterprises—maximizing their profits. Administrative agencies interfere with the public life in all aspects politically and economically. However, bureaucracy is not arbitrary. Administrative law, especially referring to due process, provides the public an adequate and proper means to confront authority and to have access to correct the government’s mistakes.

I agree with Von Mises’s description and understanding of bureaucracy. Mises stated that “bureaucratic management is incompatible with democratic government and institutions” (Mises 1944, 41). “The main difference between a policeman and a kidnapper and between a tax collector and a robber is that the policeman and tax collector obey and enforce the law, while the kidnapper and robber violate it” (Mises 1944, 76). I like the interesting comparison between our legal government and illegal robber. They all take property and liberty, to some extent, from us. The only difference is that the former does legally while the latter does illegally. In this sense, it is true that administrative agencies are a serious threat to liberty.

  1. Von Mises compared profit management with bureaucratic management from economic point of view. He pointed that bureaucracy is the disease of state intervention in economy.

Von Mises concludes the most frequent methods of interference with the profit into four points:

  1. The profits that a special class of undertakings is free to make are limited.
  2. The authority is free to determine the prices or rates that the enterprise is entitled to charge for the commodities sold or the services rendered.
  3. The enterprise is not free to charge more for commodities sold and services rendered than its actual costs plus an additional amount determined by the authority either as a percentage of the costs or as a fixed fee.
  4. The enterprise is free to earn as much as market conditions allow; but taxes absorb all profit or the greater part of it above a certain amount (65).

In this sense, bureaucracy restricts the liberty of market economy—maximizing profits. Private enterprises are not free to earn as much as they can from the market. However, bureaucracy limits their liberty through making regulations, interfering with the board personnel and levying tax. On the other hand, there is “unlimited dependence on the discretion of government bureaus” (Mises 1944, 71). Mises (1944) also states that the government has unlimited power to ruin every enterprise or to lavish favors upon it. The government limits the public liberty, while it practices liberty without restrictions, as the law maker.

Mises’s definition of the main characteristics of bureaus provides me better understanding of bureaucracy economically:

  1. Bureaus specialize in the supply of those services the value of which cannot be exchanged for money at a per unit rate;
  2. Bureaus cannot be managed by profit goals and the economic calculation;
  3. In the absence of profit goals, bureaus must be centrally managed by the pervasive regulation and monitoring of the activities of subordinates (74).

Lacking the profit motivation, the bureaucrats exercise their authorities based on laws and regulations. “The bureaucratic management is the management that aims to obey hierarchical orders” (Mises 1944, 113).

  1. The nature of bureaucracy—providing public services, makes it threaten public liberty inevitably. The purpose of due process is providing the public an approach to protecting their liberty legally and effectively. Funk and Seamon illustrates the applicability of the due process: first, one must consider the private interest that will be affected by the official action; second, one must consider the risk of an erroneous deprivation of that interest under the required procedures and the required procedures and the likely reduction of that risk by requiring more or different procedures; third, one must consider the government’s interest in using the required procedures, as opposed to more or different procedures. In a word, the public are able to sue the government, going through the simplest procedures, only if their private interest is affected by the official action, with considering the government’s interest and influence. The bureaucratic system protects liberty through providing the public a legal approach to a reasonable extent.

“Due process protections apply when government would restrict your physical freedom or your freedom to pursue your profession” (Funk and Seamon 2011, 115), including one’s good reputation. The Due Process Clause often provides certain procedural safeguards in both federal and state informal adjudications.

Our bureaucratic system also protects the public liberty through limiting its own power. It could be found in the setting of substantive Due Process, which refers to limits on what government can regulate. In this sense, our bureaucratic system protects the public liberty through providing the public approach to speaking to government and limiting government’s authority within a reasonable boundary.

However, the means of protecting the public liberty is very limited. The Court said that due process was required only when “a relatively small number of persons was concerned, who were exceptionally affected, in each case upon individual grounds” (Funk and Seamon 2011, 109).

III. There are merits of Von Mises view of bureaucracy.

First, Mises characterized the nature of public administration. He stated that “in public administration, there is no connection between revenue and expenditure” (Mises 1944, 84). The motivation of public administration is not profit. The nature of bureaucracy is providing public services.

Second, Mises admitted the priceless value of bureaucracy. He thought that there is no possibility to measure government’s performance for three reasons: first, it is difficult to find proper standards that can be used to assess the performance of every individual and department; second, it is difficult to measure the costs and the benefits of the agency; and finally, different branches of the central and local government can have public expenditure programs with different and incompatible aims.

Finally, Mises emphasized the necessity of public administration. “It is true that society could not do without the services rendered by patrolmen, tax collectors, and clerks of the courts” (Mises 1944, 77), Mises continued to state, “The bureaucrat is not only a government employee. He is both employer and employee (voter), who plays the most important role in pecuniary interest, voting for the use of money and allocation of resources (80). The government is over the public; and it is also from the public. American bureaucracy restricts the public liberty by making laws and enforcing laws; meanwhile, it provides the public the legal approach to speaking to government through Due Process.

References:

William F. Funk and Richard H. Seamon. Administrative Law: Examples & Explanations.   Wolters Kluwer Law & Business, New York, 2011

Ludwig Von Mises. Bureaucracy. Yale University Press, 1944

“ATF Framework for Determining Whether Certain Projectiles Are ‘Primarily Intended for Sporting Purposes”, retrieved from: https://www.atf.gov/sites/default/files/assets/Library/Notices/atf_framework_for_determining_whether_certain_projectiles_are_primarily_intended_for_sporting_purposes.pdf

“National Firearms Act”, retrieved from: https://www.atf.gov/content/firearms

“The Obama Administration’s M855 Ammo Ban Is Blatantly Lawless”, retrieved from:

http://thefederalist.com/2015/03/09/the-obama-administrations-m855-ammo-ban-is-blatantly-lawless/

Frankel, Todd. “How Angry Gun Owners Shouted Down a Ban on Armor-piercing Bullets”. Wonkblog. Retrieved from:

http://www.washingtonpost.com/blogs/wonkblog/wp/2015/03/10/how-angry-gun-owners-shouted-down-a-ban-on-armor-piercing-bullets/

“ATF shelves bullet ban proposal”, retrieved from: http://thehill.com/regulation/pending-regs/235216-atf-shelves-proposed-bullet-ban

Kentucky Gun Price, retrieved from: http://www.kygunco.com/diamondback-db15-556-75in-bbl-fde-30rd-pistol-69748

Hamilton, Alexander, John Jay, and James Madison. The Federalist. Gideon edition, ed. George W. Carey and James McClellan. Indianapolis: Liberty Fund. 2001.

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