The recent Post series on the use and abuse of consultants by the federal government was instructive but may prove misleading unless one understands the causes of the problems. Simply put, the horror stories arise out of the clash of two powerful forces:
1) The federal government is attempting to do more -- through subsidies, regulations and administration -- than it has ever done before.
2) The politicians do not wish to be seen increasing the number of civilians who work for the federal government.
Faced with this dilemma, one can either try to get the existing federal bureaucracy to work harder or farm out the work to persons who are not technically part of the bureaucracy.
Obviously, the latter is the course of least resistance. Indeed, there is little reason to suppose that, given Civil Service regulations and political sensibilities, one could make the existing bureaucracy much more productive even if one wanted to. Ironically, the much-heralded "Civil Service reform" of President Carter -- a plan to loosen the strict job security of some officials in exchange for the prospects of more pay -- was aimed at the highest levels of the Civil Service, where, in my experience, people are already working very hard.
Hiring consultants is only one way of increasing the size of the bureaucracy without appearing to do so. Another is to delegate operating responsbility for federal programs to state and local officials who are paid by -- or pass out money from -- federal grants-in-aid. A third is to purchase services from firms that, though nominally part of private industry, have become wholly dependent on federal contracts (the military aircraft and shipyard industry, for example). One study estimated that in addition to the 2.8 million civilians who work directly for the federal government, another 6 million to 8 million work for it indirectly.
There are advantages, and not just political ones, to concealing the true size of the federal work force by consultant and contract arrangements. One is that it is easier to fire a consultant than to fire a civil servant. When budgets are tight, it is easier to lay off consultants than to reduce the standing Civil Service. People who would not work for the federal government because they cannot get rich doing so will work for private firms because they can get rich. By the same token, contractors can go bankrupt; the government cannot.
These advantages are acquired at a cost, as The Post series dramatized. When a lot of money is changing hands there will inevitably be come chicanery in determining who gets how much. The consultants will sometimes produce shoddy or even silly reports; since there is usually no way to prove that a better report was possible, it is hard for the government to demand its money back. If people who pass out contracts can wield life-or-death power over consultants who want them, the ways by which influence will be brought to bear on them will be as various, and as hard to control, as the imagination of man.
It is not clear to me, however, that there are any easy remedies for this problem. Some may believe one can have the benefits of consultants (which is to say, of a concealed federal work force) without the costs. I doubt it. Open bidding, the revelation of conflicts of interest, public scrutiny of consultant contracts -- these changes will certainly make the process more cumbersome. They may possibly prevent the worst abuses, but the essential problem will remain.
And that problem is this: a big government cannot do a large number of complex tasks well. Consider the following mental experiment.
Suppose that we gave to the Environmental Protection Agency sufficient staff to learn all it needed to know about every potential pollution hazard, to the Department of Energy enough investigators to keep track of the flow of oil in and around the country, to the Department of Defense enough researchers to examine all military eventualities. Does anyone suppose that the enormous growth in the bureaucracy would be counterbalanced by an improvement in the quality, timeliness and disinterestedness of the studies being performed? Does anyone know -- has anyone tried to find out -- whether these "in-house" studies would be better than those, earlier, "out-house" studies done by consultants?
When the government, or any organization, takes on more tasks than it has competent, thoughtful persons to supervise, the results will often be disappointing whether the studes are done inside or outside the organization. If many of these studies are going to be disappointing -- even ludicrous -- anyway, there may be something to be said for having them done by consultants. at least when someone notices that a study is gibberish, the consultant can be fired, or not rehired or otherwise have his reputation tarnished.
If it is desirable to be able to fire consultants easily, then it is necessary to be able to hire them easily. The more elaborate the procedures we employ to award the initial contract, the more we create a set of expectations and rights that will make it difficult to deny contracts to incompetent firms.
Moreoever, if Congress reduces the number of consultants, it will reduces the amount of information it gets. A large fraction of every agency's research budget is devoted to answering questions -- by means of consultants -- put to it by congressional committees. Another large fraction is devoted to hiring firms to satisfy congressional desires to reward firms, localities and ethnic groups -- a kind of "intellectual pork barrel."
Since The Post didn't suggest eliminating consultants, my imaginary experiment may seem irrelevant. But it is not, for it forces us to see that our problems derive in large measure from problems of scale and only marginally from problems of form. If there are some rules and laws that will improve procedures and forms, well and good; I support them. But no one should imagine that these rules and laws will have more than a marginal impact on a phenomenon as large as that two which The Post has alluded.