Janine Wedel - Shadow Elite - How the World's New Power Brokers Undermine Democracy, Government, and the Free Market

For reviews of perspectives on neoliberalism, see, for instance, Dieter Plehwe, Bernhard J. A Walpen, Gisela Neunhöffer, eds., Neoliberal Hegemony: A Global Critique (New York: Routledge, 2005), and Justin B. Richland, “On Neoliberalism and Other Social Diseases: The 2008 Sociocultural Anthropology Year in Review,” American Anthropologist 111, no. 2 (June 2009), pp. 170–176.

12. On the issue of bureaucracy: It is important to keep in mind that the regulation of bureaucracy through formal, impersonal structures does not imply a lack of personal networks or personalized relationships. As governance scholar Hugh Heclo showed in 1977, “life at the top of the government bureaucracy is far different from the strict procedures, written orders, and rigid hierarchies generally associated with the term ‘bureaucracy.’” See Hugh Heclo, A Government of Strangers: Executive Politics in Washington (Washington, DC: The Brookings Institution, 1977), p. 2.

On the issue of Japan, see the work of American political scientist Chalmers Johnson. In his 1982 MITI and the Japanese Miracle , he argued that Japan’s economic “miracle” in the second half of the twentieth century could largely be explained by the nation’s close cooperation between government and business. This miracle manifested itself in rates of economic growth unprecedented in Japan’s history, and, more specifically, growth in industrial production. Chalmers Johnson, MITI and the Japanese Miracle (Stanford, CA: Stanford University Press, 1982). See especially chapter 1, “The Japanese ‘Miracle.’” See also Clyde Prestowitz, Trading Places: How We Allowed Japan to Take the Lead (New York: Basic Books, 1988). For later reflections on the subject, see, for instance, Edward W. Schwerin, “Japan’s Economic Crisis: The Role of Government,” Managing Economic Development in Asia: From Economic Miracle to Financial Crisis , Kuotsai Tom Liou, ed. (Westport, CT: Praeger Publishers, 2002), p. 43. For a description of East Asian government-business relationships and the variety of models, see Manuel Castells, The Rise of the Network Society , 2nd ed. (Malden, MA: Blackwell Publishers, 2000), pp. 188–195.

13. With regard to the goals of contracting out, see Dan Guttman, “Contracting, an American Way of Governance: Post 9/11 Constitutional Choices,” in Thomas H. Stanton, ed., Meeting the Challenge of 9/11: Blueprints for More Effective Government (Armonk, NY: M. E. Sharpe Publishers, 2006), p. 230. With regard to the participation of nongovernmental actors in governing, see, for example, Lester M. Salamon, The New Governance: Getting Beyond the Right Answer to the Wrong Question in Public Sector Reform , School of Policy Studies, Queen’s University: The J. Douglas Gibson Lecture, delivered February 3, 2005, p. 5.

14. The quote from Reagan is from Ronald Reagan, “To Restore America,” March 31, 1976, http://reagan2020.us/speeches/To_Restore_America.asp, accessed June 24, 2006.

The quotes from Gore are from Al Gore, “Remarks by Vice President Al Gore, Opening Session of International REGO Conference,” International Reinventing Government Conference, January 14, 1999, http://clinton2.nara.gov/WH/EOP/OVP/speeches/interego.html, accessed April 14, 2007.

The ideas about injecting business principles into government are set out in David Osborne and Ted Gaebler, Reinventing Government: How the Entrepreneurial Spirit is Transforming the Public Sector (Reading, MA: Addison Wesley, 1992). Berating bureaucracy is a crucial component here. David Osborne even wrote a book (with Peter Plastrik) titled Banishing Bureaucracy: The Five Strategies for Reinventing Government (Reading, MA: Addison-Wesley Publishing Company, Inc., 1997).

15. Author’s interview with Graham Scott, December 10, 2006.

16. On “performing for the public,” see the work of John Clarke, “Performing for the Public: Doubt, Desire and the Evaluation of Public Services,” The Values of Bureaucracy , Paul Du Gay, ed. (Oxford, UK: Oxford University Press, 2005).

17. Daniel Guttman and Barry Willner, The Shadow Government: The Government’s Multi-Billion-Dollar Giveaway of Its Decision-Making Powers to Private Management Consultants, “Experts”, and Think Tanks (New York, NY: Pantheon, 1976).

18. For evidence regarding the outsourcing of inherently governmental functions and dearth of contract oversight, see chapter 4 of this book. As legal scholar and governance expert Dan Guttman wrote 30 years after coauthoring The Shadow Government , “The evidence that the official workforce can no longer be presumed to have capacity to account has long gone well beyond anecdote; red flags counseling due diligence are omnipresent; they include high level official admissions of systematic deficiency, years of Government Accountability Office findings of agency-wide deficiencies, and continuing failures of third party oversight in sensitive and showcased programs.” Dan Gutttman, “Contracting, an American Way of Governance: Post 9/11 Constitutional Choices,” Thomas H. Stanton, ed., Meeting the Challenge of 9/11: Blueprints for More Effective Government (Armonk, NY: M. E. Sharpe Publishers, 2006), p. 231.

The first quote from the inspector general in this paragraph is from Department of Homeland Security, Office of Inspector General, Improvements Needed in the U.S. Coast Guard’s Acquisition and Implementation of Deepwater Information Technology Systems , OIG-06–55, August 2006, p. 1. The Government Accountability Office earlier found that “the key components needed to manage the program and oversee the system integrator’s [that is, the Lockheed/Northrop team’s] performance have not been implemented.” Government Accountability Office, Coast Guard’s Deepwater Program Needs Increased Attention to Management and Contractor Oversight , GAO-04–389, March 2004, p. 3. The inspector general cited in the Wall Street Journal is found in Bernard Wysocki Jr., “Is U.S. Government ‘Outsourcing Its Brain’?” Wall Street Journal , March 30, 2007, p. A1. Information on the continuing involvement of the companies can be found, for example, in Renae Merle and Spencer Hsu, “Coast Guard to Take Over ‘Deepwater,’” Washington Post , April 17, 2007, p. D01. The length of time it will take to refederalize the operation is from my interview with a staff member responsible for oversight, United States House Committee on Energy and Commerce, May 24, 2007.

19. The neoliberal ethos holds that handing government functions to nongovernmental entities merely improves management (or, in the case of NGOs delivering services, responsiveness and citizens’ participation). On NGOs and citizens’ participation, see, for instance, Jennifer R. Wolch’s The Shadow State: Government and Voluntary Sector in Transition (New York, NY: The Foundation Center, 1990) in which she argues that state-sponsored voluntary organizations comprise a “shadow state.”

With respect to American-trained economists playing leading roles in implementing neoliberal policies, see Yves Dezalay and Bryant G. Garth, The Internationalization of Palace Wars: Lawyers, Economists, and the Contest to Transform Latin American States (Chicago, IL: University of Chicago Press, 2002). With regard to local economists trained in the United States playing leading roles, the “Chicago Boys” in Chile are but one (albeit important) example. See, for instance, Juan Gabriel Valdes, Pinochet’s Economists: The Chicago School in Chile (Cambridge, UK: Cambridge University Press, 1995). But neoliberal policies did not always have their origins in such networks. Johanna Bockman notes, for instance, that Yugoslav socialism and experts played a role in Chilean and Peruvian neoliberalism (“The Origins of Neoliberalism between Soviet Socialism and Western Capitalism: ‘A Galaxy Without Borders,’” Theory and Society 36, no. 4 [2007], pp. 343–371.)