best adapted to those states which have not reorganized and consolidated their administration. In every case, except Ohio, the purchasing agent is appointed by the Governor. In Ohio the purchasing agent is responsible to the Secretary of State. In California and Vermont he is under supervision of the state board of control, and in New Jersey he is under the State House commission. The third type, where the purchasing is left to the state board of control, is found in Alabama and Texas. The board of control is an attempt to consolidate the administration, especially of state institutions, looking toward more efficient management. However, it at once introduces board government, which for purely administrative purposes is regarded as inefficient, unbusinesslike and irresponsible. But even setting aside these objections, a board of control, burdened with fiscal, administrative, managerial and quasi-legislative functions, can hardly be expected to initiate and carry out an efficient system of purchasing. Examples of the fourth type of purchasing organization are those of New York and Wyoming. In these states the authority to purchase is vested in boards composed of state officers serving ex-officio. The members of such boards are charged with numerous other duties and, therefore, have very little time to give to the purchasing work. The work, if it is to be done, must be delegated to some person or group of persons. This is the case in New York, where the purchasing work is delegated to a subcommittee, and responsibility for the results is thereby practically dissipated.1 The objects to be attained by this device are: (1) The concentration of purchasing power, permitting goods to be bought in large quantities at the lowest and best prices under competitive bidding and promoting prompt delivery, inspection and payment for the goods, with the minimum inconvenience to dealers; (2) the standardization of supplies, eliminating unnecessary range in kinds of goods, also unduly expensive grades; and (3) the development of an expert purchasing staff, acquainted with the details and skilled in methods of the several phases of purchasing, inspecting, and testing and storing goods.2 THE EFFICIENCY MOVEMENT VS. POPULAR CONTROL OF GOVERNMENT The movement for efficiency in the management of political affairs runs counter to one of the primary principles A. E. Buck, "The Coming of Centralized Purchasing in State Governments," Supplement to the National Municipal Review, vol. ix, no. ii, pp. 134-135. 2 Ibid., p. 117. on which the American government was founded, namely, that the preservation of liberty and individual initiative is more important than the maintenance of strong government. Strong government was identified with tyranny, and tyranny was to be avoided at any cost. Moreover, popular participation in government in the United States was extended on the theory that it was desirable to interest many citizens in the conduct of political affairs even though there might be some loss in vigor and effectiveness of administration. From a belief in this and similar theories, regarded as essential to democratic government as conceived in America, came a tolerance of governmental imperfections which were regarded as the necessary price for the maintenance of democracy in government. The conflict between this fundamental tenet of American political philosophy and the standards and ideals of the efficiency movement is aptly put by Professor Ernst Freund in these words: Had a commission of economy and efficiency presided over American government from the beginning, it would tax the imagination to think of the millions that might have been saved from waste; but could there have been that spirit of individualism, that glamour of liberty, that made American institutions attractive to aliens coming to this country, and that made possible a national assimilation and consolidation which is without parallel in history? Surely that is a political asset which no mere technical perfection of government could have won for us, and it warns us not to value the traditional essentials of American institutions too lightly.1 European nations have secured efficiency in government by the establishment of a bureaucracy or a professional and permanent class of public officials. American principles and ideals do not at present sanction the control of government by a bureaucracy. It remains to be seen whether American principles of democracy are compatible with the principles of efficiency and economy, or whether democratic government necessarily means inefficient government. 1 "Principles of Legislation," American Political Science Review, vol. x, pp. Among the leaders who have defended the democratic management of government there have been two distinct groups. Some, following the tenets of Jefferson, trust the good sense and judgment of the people to select, in the long run, those who by training, experience, and general ability are qualified to be the natural leaders of state and nation. This group regard it as the function of the electorate to select such leaders and to give them public support. According to this group, there is no inherent reason why democratic government cannot be as economical and efficient as monarchy or bureaucracy. Others, following the precepts formulated by Jackson and his successors, contend that rotation in office is necessary to prevent the development of bureaucracy and to interest and educate the masses in the operation of government. To those accepting this philosophy it is much more important to keep the government near to the sources of public power and to keep the people interested and satisfied than to save money or to secure efficient services. The great problem to-day is to reconcile the principles and philosophy of these two groups and to introduce such features of the movement for efficiency and economy as will not run counter to the fundamental tenets of American democracy. SUPPLEMENTARY READINGS D. R. DEWEY, Financial History of the United States (Longmans, Green & Co.). A short account of the principles and methods involved in government finance in the United States. C. C. PLEHN, Introduction to Public Finance (Fourth Edition), (The Macmillan Company, 1920). 1917). Government Finance in the United States (Chicago, CHARLES J. BULLOCK, Selected Readings in Public Finance (Second Edition), (Ginn & Co., 1920). H. J. FORD, The Cost of the National Government (Columbia University Press). A suggestive account of "pork-barrel" methods. W. F. WILLOUGHBY, The Movement for Budgetary Reform in the States (D. Appleton & Co., 1919). 1918). -The Problem of a National Budget (D. Appleton & Co., A brief presentation of the present conditions with respect to a W. F. WILLOUGHBY, W. W. WILLOUGHBY, and SAMUEL MCCUNE LINDSAY, The System of Financial Administration of Great Britain (D. Appleton & Co., 1917). Bulletins for the Constitutional Convention, Massachusetts, 1917-18, No. 2, "State Budget Systems in the United States." A concise summary of the progress toward state budget reform, with the text of model acts. CLEVELAND, FREDERICK A., and BUCK, ARTHUR E., The Budget and Responsible Government (The Macmillan Company, 1920). Bulletins Bureau of Municipal Research, N. Y.: No. 62. "Budget Systems": A discussion before the New York No. 80. "The Elements of State Budget Making." No. 87. "Canadian Provincial Budget Systems and Financial No. 91. "The Recent Movement for State Budget Reform," 1911-17. No. 92. "The Governor's Budget in Maine," 1917. No. 93. "The New York State Legislative Budget and Financial CHAPTER II PROBLEMS IN THE REGULATION AND CONTROL OF PUBLIC UTILITIES THE NATURE OF THE UTILITIES PROBLEM The Distinction Between Public and Private Utilities.The enterprises for the satisfaction of the common needs of man may be classified as private and public. Most of man's wants are satisfied by individuals who provide commodities and perform services for the profit that may thereby be gained. In the cases where the rendering of these commodities and services becomes of interest to the public the agencies performing them have come to be known as public utilities. Some of these utilities have become so important that the government has taken them over and operates them at cost or for a very slight return in addition. Sometimes the service may even be supplied at a loss and the deficit made up by means of taxation. Among the utilities which have become public in nature, and are either operated by the state or placed under public control are carriers, ferries, roads, wharves, telegraphs and telephones, and, to a limited extent, grist mills and lumber mills. Furthermore, if the individual puts private business to a use in which the public has an interest, it becomes subject to supervision and control. Instances of this character include the grain elevators and insurance companies which the United States Supreme Court has held are of such a character as to justify the regulation and control thereof by the public. Another example is afforded by the press. 1 See cases of Munn vs. Illinois, 94 U. S. 113, and German Alliance Insurance Company vs, Ike Lewis, 233 U. S. 389. |