TJP

Messy Decision-Making Process

By Byron A. Ellis – November 11, 2009

For a while, it appeared that the election of Mr. Obama would increase administrative capacity of the executive branch of the United States government. However, the Obama administration decision-making process is messy. And, this openly messy approach to decision-making sends the wrong signal to the public.

The administration needs to internalize its decision making process and present a more refined process to the public. Otherwise, confidence in the administration will continue to slip.

Additionally, the administration must begin to show a string of successes that translate into tangible public benefit. Therefore, it has to critically evaluate the potential outcome of all decisions.

For instance, the outcome of not having a clear approach to healthcare makes it vulnerable to misinformation; the outcome of not actively preventing mortgage foreclosures dissipates consumers’ wealth embodied in residential housing, which translates into lower consumer demand. Likewise, the outcome of ignoring usurious credit cards interest rates, as well as continued speculation in energy market is also lower consumer demand, and slower employment growth.

Americans are concerned with their own welfare and they expected that fiscal and monetary expansion would have, by now, restored economic equilibrium and jobs.

Therefore, the administration needs to reassess fiscal stimulus targets and increase the speed of income delivery to the consumers. The delivery of income to bailed out financial institutions was almost instantaneous.

Unfortunately, the income of financial institutions do not drive the gross domestic product (GDP), rather it is the income of consumers that drive GDP. And, if consumers’ income is not enhanced, GDP will not be fully restored and unemployment will continue to increase.

King Kwan Tsao in responding to Professor Farazmand’s article on administrative capacity argues that the success of China is due to their leaders putting people first. The Katrina and the economic crises have demonstrated that American political leaders do not put people first.

During Katrina the government was unresponsive and during the economic crisis the government response was to support financial institutions, rather than the homeowners.

Thus far, it appears that the Obama administration lacks administrative capacity. It has yet to satisfy consumers’ needs at home or abroad. The macro vision of the administration is overarching, but it appears not to be able to identify the proper micro variables that would facilitate implementation of its macro vision.

Policy capacity is the ability of change agents to articulate beneficial changes and expeditiously translate then into reality.

If the articulation of changes that led voters to support Mr. Obama and the Democrats are not achieved within the promised time period, then the administration rhetoric will fall short of its administrative capacity and it will not bode well for the Democrats in the coming elections.

The Republicans are aware of the Democrats dilemma and are attempting to slowdown whatever the Democrats attempt to do. Surprisingly, they are receiving help from Democrats in preventing progress.

Tsao, in quoting Deng Xiaoping, one of China’s pragmatic reform architects, notes that it does not matter if the cat is white or black: the good cat is the one who catches the mice. Thus, China’s philosophy is to focus on efficient outcomes.

In the United States, however, policy philosophies are more important than efficient outcomes. As a result, policy makers are path dependent; they rely on traditions and legacy structures, often frozen in time, and refuse to consider alternative views or approaches to intractable problems.

As a result, the United States continues with legacy approaches to militarization, Middle East policies, healthcare, education, relationship with Cuba, Iran and North Korea, and a host of other critical challenges.

The inability of the current two-party system to put people first will lead to messy decision-making processes and adverse outcomes for years to come.

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