The Potential and Problems of Democratic Network Governance

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The Potential and Problems of Democratic Network
Governance

• H. Brinton Milward
• University of Arizona

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An Outline of the Potential and Problems of
Democratic Network Governance

• New Governance and the Hollow State
• Theoretical and Empirical Issues
• The Accountability Challenge of Network
  Governance
• The Tasks Ahead and the Lessons of Government
  Reform

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New Governance and the Hollow State

• Section One

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New Governance Themes

• From agency to program
• Tools
• Multiple third party actors
• From hierarchies to networks
• From public versus private to partnerships
• From command and control to negotiation
• From internal controls to program design

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The Hollow State Two Meanings

• Inflated meaning The intentional destruction of
  the governing capacity of the state
• Deflated meaning As a matter of public policy,
  government has decided to contract with third
  parties to produce taxpayer funded goods and
  services.

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The Hollow State

• The number of degrees of separation between a
  government and the services it funds.
• Services are jointly produced
• While the degree of hollowness varies, the task
  doesnt to arrange networks, not manage
  hierarchies.
• Data problems make both accountability and
  research very difficult.

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The Hollow State

• Strengths and weaknesses
• While flexibility is the strength of the hollow
  state, coordination is complex and accountability
  can be difficult to determine.

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Challenges

• The scale factor
• The complexity factor
• The network challenge
• The capacity deficit

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Performance Challenges

• Distortion of priorities
• Ceding authority to 3rd Parties
• Loss of targeting flexibility
• Balkanization of accountablity
• When everyone is accountable, no one is
  accountable.

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Perennial Problems

• Contracting
• Caesar complained about contractors in his
  Commentaries on the Gallic Wars.
• The complexity of joint action.
• Pressman and Wildavskys classic implementation
  problem
• Problem organization mismatch
• The U. S. Dept. of Homeland Security connects
  1950s technology to the worst 21st Century
  problem

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Developments in the U.S.

• The Hollow State
• Health and social services
• Military contracting
• NASA, Energy and EPA
• The National Security State
• Dept. of Justice
• Homeland Security

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Democratic Network Governance

• Contracting Regime
• Vertical links
• Horizontal links
• Both make transparency difficult and
  accountability hard to determine
• Bureaucracy
• Secrecy and control of expertise make
  transparency problematic but accountability is
  clear.

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Theoretical and Empirical Issues

• Section Two

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How Do We Study Network Governance?

• The collective action of organizational actors
  analyzed as a political economy.
• i.e. The joint outcomes of market and political
  processes taking place both within and between
  organizations
• The application of network analysis to
  organizational change resulting from this
  collective action.

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The Structural Paradox of Networks

• The instability paradox
• Networks are chosen because the are more flexible
  than hierarchies, but they are fragile and need
  stability to work well.
• Network management differs according to resources
  available.
• A well coordinated network may be good at
  rationing.
• When money is plentiful, there is less incentive
  to coordinate.

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Network strategies

• The competition dilemma
• If you compete, how do you coordinate?
• Generalist versus specialist strategies
• The General Motors strategy
• The niche market strategy asset specificity
• Does the environment select a limited number of
  successful network forms?

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Theoretical Quandaries of Network Governance

• What happens to organizations when the density
  of networked transactions (contracting and
  coordinating) across organizational boundaries,
  is greater than the number of internal
  transactions?
• How should we conceptualize a situation where
  networks reach beyond the boundaries of the
  organizations that created them?

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The Accountability Challenge of Network Governance

• Section Three

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Accountability

• Are we losing sight of accountability as a core
  element of democratic governance?
• Has this been a part of the debate over the
  various reforms we call New Public Management?
• Has the romance of the market led us to assume
  that the hidden hand will take care of
  accountability?

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Accountability Challenges

• Accountability to multiple constituencies
• Multiple actors empowered to bargain
• Third parties have leverage
• Political resources
• Voluntary participation
• Monopolies over beneficiaries
• Information asymmetries
• Complex implementation chains

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The Meaning of Accountability

• The promise of justice
• Who is responsible?
• The promise of performance
• Did it work?
• The promise of democracy
• Is it fair?

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The vertical and horizontal authority challenges

• The vertical authority model
• The horizontal authority model
• The links between the two call for parallel
  systems of management but by whom?

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What are the options for accountability?

• Law
• Professional standards
• Boards of directors

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The Tasks Ahead and the Lessons of Governance
Reform

• Section Four

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Tasks ahead

• Confront the issue of democratic accountability
  head on.
• This a problem of democratic government, not a
  management problem
• Build systems that are accountable
• Invest in the front end design and invest in
  monitoring and technical assistance
• Realize that networks are a fundamental
  organizational problem
• we need to know a lot more about how to manage
  networks effectively.

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The Lessons of Government Reform

• No reform can ever fully solve the problems that
  led to its creation
• Lingering issues tend to breed the next
  generation of reform, like the problem of
  accountability
• Governance is not so much a problem-solving
  activity as a problem-balancing activity.
• Problems tend to recur and the solutions are
  limited
• Decentralization follows centralization
• Deregulation follows regulation