The curse of managerialism

Of moral arrogance, self-serving reductionism and the displacement of custodianship.

The United States has suffered a great deal of harm from importing other people’s intellectuals. This not despite, but because, it created the world’s first mass university system. For the pathologies of academe have repackaged and spread noxious ideas into US institutions and body-politic.

Prime examples of harm from imported intellectuals are provided by the life and works of Theodor Adorno, Max Horkheimer, Herbert Marcuse and Elton Mayo. The common threads of these toxic intellectuals are intellectual charlatanism tied to grotesque moral arrogance.

Academe’s lack of reality and character tests, its selection-by-approval, its elevation of intent by those not required to make anything work, the desire for grand intellectual systems, and the pose of intellectual sophistication, make it very susceptible to bloated structures of pseudo-sophisticated, even pseudo-scientific, moral arrogance; to creating theories that are mountains of bullshit erected on molehills of truth.

The first three harmful intellectuals listed above are German Jewish intellectuals wrapped up in the morally grandiose systemising that Jewish intellectuals seem particularly receptive to. They all followed in the footsteps of the greatest, and most destructive, exemplar of that tendency, Karl Marx.

The fourth, Elton Mayo, was neither Jewish nor German. He was, I am sorry to say, an Australian. He was a Harvard professor and a key developer of the noxious ideology of managerialism. All the more noxious as it pretends to be organisational science rather a mixture of pretension and practices.

Sivani Bandaru on Unsplash.

A useful summary of managerialism is that societies are equivalent to the sum of decisions and  transactions made by the managements of organisations. It is surely the only case of an ideology where a key figure was an Australian. As historian James Hoopes tells it:

But the main genesis of managerialism lay in the human relations movement that took root at the Harvard Business School in the 1920s and 1930s under the guiding hand of Professor Elton Mayo. Mayo, an immigrant from Australia, saw democracy as divisive and lacking in community spirit. He looked to corporate managers to restore the social harmony that he believed the uprooting experiences of immigration and industrialization had destroyed and that democracy was incapable of repairing. A man of enormous personal charm, Mayo was a gifted psychotherapist but also an intellectual charlatan who molded his data to fit his preconceived ideas. He was one of the most important social scientists in American history and still exerts enormous influence over the way we live and work. Mayo and the researchers he gathered around him—the “Harvard human relations group”—created the mix of democratic appearance and elitist substance that still dominates the management movement in America and, increasingly, the world.

It is not all that surprising that an Australian expatriate might have such a view during the interwar period. This was, after all, the period that also produced F.W. Eggleston's minor classic State Socialism in Victoria (1932), an analysis of the use of statutory authorities to deliver a wide range of services.

State utilities

According to Murray Horn's analysis, reliance on statutory authorities was a rational political response to unstable governments — creating a statutory authority provided a stream of benefits to constituents that would outlast any particular (and likely temporary) parliamentary majority. It is notable that the string of long-serving Governments in Victoria in recent decades has seen the abolition of many of these statutory authorities and their absorption into public service departments under direct Ministerial control.

This has not always been an improvement for public policy. One could well argue that water and transport were both better managed under the Melbourne and Metropolitan Board of Works than they have been subsequently. For example, if the 1969 Transport Plan had been followed, Melbourne would be significantly better supplied with both road and rail transport, rather than playing endless "catch up" due to the long infrastructure construction drought between the Hamer Government's retreat from the Doncaster rail line (under resident pressure) in 1976 and the Kennett Government's approval of CityLink in 1994. Similarly, the water infrastructure construction drought after the completion of the Thomson Dam (1976-83) did not stand Melbourne in good stead when actual drought hit.

The public servants in charge of such statutory bodies do often seem to have had a genuine notion of custodianship, of performing a service for the citizens. That they were long-serving officials running organisations set up to have longer time horizons perhaps helped with that.

Custodianship requires respect for the past, and the efforts of those who came before us, plus a sense of service to others not degraded by some moralised hierarchy (such as intersectionality bingo points). All the aforementioned intellectuals pushed ideas deeply corrosive of any sense of custodianship. As Hoopes points out, managerialism encourages managers to see themselves as moral leaders: something hardly likely to induce a service-oriented humility.

Utilitarian state

The other reason why an Australian might foster managerialism is the pervasive utilitarianism of Australian political culture — what political scientist Hugh Collins called Australia's Benthamite political culture. Australia is the country where the Chartists won.

In his 1930 classic Australia, historian Sir Keith Hancock referred to the Australian view of the state as:

a vast public utility, whose duty is to provide the greatest happiness for the greatest number.

And such utilities have to be managed. Happiness and the public good becomes a management problem.

One doesn't have to completely endorse John Ralston Saul's Voltaire Bastards thesis (nicely discussed here) to see a problem with this, though Saul's contrast of leadership with management is well taken. Leadership is about people and effectiveness; management is about administrative processes.

Moreover, management as such is not managerialism. Management proper is some mixture of administrative support and leadership. Managerialism subordinates service-providers to input-output processes and to generic expertise in “management”.

Soft managerialism

Hence we come to "soft" managerialism — the belief that people, organisations and institutions are input-output problems, so the more they are managed, the better the output-for-input results. In many ways, we live in an age of managerialism. Corporations, non-government organisations (NGOs) and the public sector are all rife with such managerialism.

There are countervailing factors — bankruptcy being the obvious one for corporations. Enron was a particularly egregious example of feral managerialism. Institutions and organisations are more vulnerable to managerialism the less the accountability constraints on them.

Which has made Australian universities particularly prone to the managerialist curse. As I explained years ago to a then colleague who wondered aloud why university administrations were so bad, they have all the unfortunate incentives of the public service with almost none of the accountability constraints.

Which, as neither factor has changed significantly since, means that universities have become more overrun with managerialism rather than less. A friend tells me that it was seriously proposed at the University of Melbourne to put academics in open plan offices — a proposal that is so silly at so many levels, it is hard to know where to start. As my friend pointed out, no academic is going to bring their personal library into an open plan office. Nor will they be able to have private discussions with students, or shut out the world and quietly think and research. It is managerialism at its most overblown and most inane. Such managers "see" the input-output problem; they don't understand what matters, still less the human interactions which are the ultimate point.

An even more egregious recent example was the central administration of a prominent university imposing, unasked, a new online examination system on a faculty. This was done without training of the faculty, without testing the new system, ignored warnings from within the faculty while restricting communication to a generic email address, so making it completely opaque who was actually responsible. When the first use of the system — as one might expect — generated a range of problems and failures, said generic email became a communication “black hole”.

Managerialism is not only a problem at Australian universities, it also infects US higher education:

Over the last 25 years the number of administrative employees at U.S. colleges and universities more than doubled, according to a joint study by the New England Center of Investigative Reporting and the American Institutes for Research. The ratio of nonacademic positions to faculty positions doubled at both public and private institutions. Overall, the industry has added an average of 87 administrative positions per day, a rate has scarcely slowed since the economic downturn, despite tuition increases.

As sociologist of organisation Philip Selznick warned:

…university led by administrators without a clear sense of values to be achieved may fail dismally while steadily growing larger and more secure.

Leadership in Administration, p.7.

Public sector dynamics

The EU bureaucracy is far more like university administration in its lack of accountability than ordinary State apparats. It is all very well to say that the European Council is elected heads of government, but they are not elected on the basis of their membership of the Council, nor performance therein, so the accountability is very weak.

Public sector bureaucracies suffer specific problems precisely because they are politically embedded, so a whole lot of people both want, and feel entitled, to a piece of them. As James Q. Wilson observes about the US Post Office:

Being a monopoly, it had little incentive to find the most efficient means to manage its services; being a government monopoly, it was not free to adopt such means even when found—communities, Congressmen, and special-interest groups saw to that.

Nevertheless, public sectors in democracies generally work far better than they do in authoritarian or totalitarian regimes, precisely because there is a much better flow of information and more pressures for accountability. The superficial coherence of purpose of authoritarian or totalitarian regimes can often generate an illusion of effectiveness that is contradicted by the experience of people who have to live under them.

The impression of effectiveness that the People’s Republic of China generated in its initial response to the Covid pandemic encouraged many Western governments to copy measures that flatly contradicted their own previously drawn up pandemic responses. As time has marched on, just how dysfunctional the CCP’s (Communist Party of China) response to Covid was has become clearer. Dysfunctions that any serious student of totalitarian regimes could have warned people to expect.

The huge surge in economic growth China has experienced since 1979 is mostly despite the CCP, not because of it. Indeed, the sheer level of waste of resources CCP policies have given rise to  during this growth surge is becoming clearer and clearer. The experience of Singapore, of Hong Kong (both former British colonies), and of Taiwan under the Kuomintang and after, all demonstrate what a disastrous drag on Chinese economic growth the CCP has been. These countries are, in order of GDP per capita, #1, #10, #12 respectively compared to China at #73 (out of 192).

It is fairly clear that part of the appeal of the “PRC model” of pandemic response was that it appealed to bureaucratic pathologies increasing managerialist leverage. Public health authorities enthusiastically imposed an information regime that de-legitimised alternative sources of information.

Rather than have clinicians report publicly their experience in dealing with a novel disease, they were required to conform to the public health messaging, being threatened with (among other things) loss of licence to practice if they failed to do so — with an implicit threat to future grants cowing academic scientists. US public health authorities systematically organised to suppress discussion of a possible lab-leak origin, as their funding of gain-of-function research would thereby be implicated. All this was very CCP-like: part of a wider pattern of convergence.

Lockdowns and mandatory vaccinations imposed “one size fits all” policies that were much easier to manage than the targeted response that the hugely variable levels of vulnerability to the pathogen clearly required. The Governors of New Jersey and New York moving the sick into elderly care residences — something that the CDC had explicitly warned against in previous pandemics — resulted in many avoidable deaths but fitted into the notion of a threat of hospitals being overwhelmed that was the managerialist narrative of the moment.

That Covid was a disease the vulnerability to which was overwhelmingly determined by your metabolic health was not seriously confronted by managerialist public health authorities. That this would have thrown into sharp relief public healths’ dysfunctional nutrition guidelines may help explain this, as might that it would have made a nonsense of the “one side fits all” response.  The patterns of excess deaths then and since — including Sweden, which most closely followed previously established pandemic policies, having the lowest excess death rate in Europe — along with various other social costs, points to a grotesque level of failure of public health managerialism.

The missing custodians

In the aforementioned interview, Saul states that:

when you have power, the most important responsibility is not to do damage to the thing you are in charge of.

And, talking further of Thomas Jefferson's approach to political responsibility and leadership, he sounds positively Daoist:

a non-solution oriented approach … a doubt approach. That a lot of it is just getting out of things, avoiding things.

But managerialism feeds managerial aggrandisement — that they, the so-needed managers, are the problem-solvers, armed with whatever current Theory has fashionable legitimacy.

Conversely, if and when people act otherwise than is managerially convenient, such people are not-accepting-proper-management “problems” to which more management — i.e. more of the heroic problem-solving managers and more of their problem-solving managerial power — is the solution.

Even worse, such managers are not custodians of anything except their own convenience and legitimating processes. History doesn't count because legacy is not a solution to input-output problems. If your only tool is a hammer, everything starts looking like a nail; and if your only role is to "manage", everything starts looking like your sort of management problem.

Having an intelligentsia in love with the idea of their own subversiveness leaves one open to such un-anchored-in-anything-but-convenience "problem-solving". Not least because being "subversive" has to be good because our legacies are “clearly” so problematic. All of this is connected to the disastrous notion of modernism — that the new is always better. The cult of subversion and the cult of managerialism feed off each other, systematically undermining any notion of custodianship.

While it is true that oppression, privilege, power and exploitation are part of the selection processes of history, it also true that learning what works is part of the selection processes of history, creating embedded learning — and what works with actual people, not pawns in input-output problems. So, while there is a rich irony in universities being such hothouses for the managerialist disease, it is not one for complacent satisfaction; universities matter.

It has also not been helpful that the academics main direct experience of "economic reform" has been such managerialism. It provides a quite distorted perspective of the wider phenomenon of economic liberalisation. Which no doubt helped the academic success of Michael Pusey's fairly asinine book on "economic rationalism". The notion that the glue of the economic reform policy alliance was to create a sustainable welfare state just passes the analysis, and those who buy into it, by.

But the problems of managerialism extend much wider than distorting the perspectives of academics about a wave of global policy reform. The input-output language of "clients", "customers", etc has invaded the realm of education (and public service generally) without actually providing a service anywhere up to the pretensions of its managers.

Managerialism also feeds on itself, as N. S. Lyons observes:

This managerial takeover was accelerated by what I call the managerial doom loop: the larger and more complex an organization grows, the exponentially more managers are needed; managers therefore have a strong incentive to ensure their organization continues to grow larger and more complex, resulting in greater relative power for the managers; more growth means more managers must be hired, who then push for more expansion, including by rationalizing a need for their cancerous bureaucracy to take over ever more functions of the broader economy and society; as more and more territory is surrendered to bureaucratic management, more managers must be educated, which requires more managers…¹

Australia suffers destructive administrative bloat in its universities, with managerialist “doom loops” of bureaucracy generating more bureaucracy well in evidence.

Sociologist Georg Simmel argued that organisations tended to take on the form of bodies they were in conflict with. Hence, as government became more bureaucratic, so did the organisations that dealt with government. As James Q. Wilson observes:

The operation of regulatory bureaus may tend to bureaucratize the private sector. The costs of conforming to many regulations can be met most easily—often, only—by large firms and institutions with specialized bureaucracies of their own. Smaller firms and groups often must choose between unacceptably high overhead costs, violating the law, or going out of business.

This regulatory contagion of bureaucratisation has become particularly obvious with labour, civil rights and anti-discrimination law, which has generated HR departments in corporations that are often the bridgeheads for morally pretentious, and intrusive, managerialism. As I have discussed elsewhere, Diversity-Equity-Inclusion has spread so far precisely because it so target bureaucratic pathologies and, we might add, managerialist conceits.

Much of the success of Post-Enlightenment Progressivism aka the popularisation of Critical Theory aka Critical Constructivism aka ‘wokery’ comes from the way it generates an aggrandising moralised managerialism, providing folk ways of signalling compliant piety within the moral mazes of managerialist bureaucracies.

It flatters and endorses managers as moral leaders. As such Critical Constructivism is all about moralised power-grabs, it fits in even better with managerialist pretensions. Managerialism can become a substitute for politics: indeed, grounds for suppressing and de-legitimating politics. There is more than a little of such in the anti “disinformation” push.

One way that managerialism feeds on itself is by use of consultants. Consultants are not committed to, or impacted by, the effective operation of the institution or organisation that brings them in. On the contrary, the relationship of consultants with the organisation is often piratical: they come in, raid resources, and disappear, bearing no costs for whatever damage they leave in their wake.

If you were genuinely interested in better operations of your organisation, you would form a working party of folk actually involved in delivering what the organisation delivers, giving them the administrative resources they required to do the job. But the whole point of managerialism is to replace those with delivering-the-service expertise by generalist managers.

Working parties of service-providers undermines the claims of managers. Outside consultants — whose actual clients are said managers — support the claims of managers twice over. They elevate the managerialist conceit and pander to the same by recommendations that are far more likely to reflect the interests of the administrators that hired them than those of service-providers.

While it is difficult to find service-providers who can also manage, Vivek Ramaswamy points out a key problem with substituting managers for service-providers:

So the real problem with the rise of the managerial class isn’t simply that the “elites” are winning and “ordinary people” are losing. It’s that the essential purpose of an institution—be it a company or a university—is less likely to be realized when it’s led by a manager than when it’s led by someone who embodies the essence of what that institution does. …

I view it as a battle between hired hands and those who embody the essence of an institution—like professors at universities, doctors at hospitals, or founders and shareholders at companies.

Woke Inc., p.101.

More and more resources are consumed by managers/administrative staff who hoard authority — including blocking or delegitimise information they do not control — spend resources on themselves and seek protection from the complexities of competence: including by the simple expedient of making it very unclear who is responsible for what. They colonise the resources of the organisation or institution while regularly, in doing so, degrading the service provided by the organisation or institution: partly by simply suppressing, blocking or dissipating feedback.

As Tanner Greer points out, managerialism has been destroying people’s sense of agency. Which used to be one of the US’s strengths:

Where Americans once asked “how do we solve this?” they now query “how do we get management on my side?”

…

The skills needed to navigate this bureaucratic world—climbing up bureaucratic ladder, learning to make convincing appeals to those higher up in the hierarchy, and so forth—are rarely conducive to practical problem solving. Bureaucracy is a powerful tool for people who come from a culture of agency. But bureaucratic management slowly but surely strangles the culture that tames it, and later generations ascend to power without ever having learned how to effectively wield it.

Managerialism is the ever-adaptable ideology of imperial bureaucracy. The racketeering and cartelising of ESG is precisely the mixture of moral arrogance, spurious quantification and resource-consuming technique-worship that is made for managerialism.

The managerialist mentality suppresses, rather than provides, information and avoids responsibility; if necessary by hiding: whether through anonymous “contact” points or by simple absence. Patterns that were particularly grotesquely on the display after the August 2023 Maui wildfires.

Organisations end up being run by people whose incentives are not about custodial service, or even solving problems, but about organisational advancement, causing a destructive moral maze.

Some particularly horrifying examples come from the systematic failure to investigate or prosecute Muslim perpetrators of systematic sexual abuse of teenagers, apparently due to fears about generating “Islamophobia”. This is performative moralism being an appalling betrayal of the vulnerable. Something we have also seen with the Transcult, though public opinion is clearly shifting on that issue.

As Thomas Sowell puts it:

You have people making decisions who pay no price for being wrong, no matter how high a price other people pay.

This is an expanding pattern in our society that Thomas Sowell is absolutely correct in saying that it needs to be reversed.

So, there needs to be more calling out of managerialism for what it is — a distortion of understanding of people, organisations and institutions which serves managerialist convenience, careerism and empire-building but not the institutions upon which it is inflicted nor the wider societies, whose legacies are being corrupted and, in the end, profoundly mis-managed.

References

Hugh Collins, ‘Political Ideology in Australia: The Distinctiveness of a Benthamite Society,’ Daedalus, Vol. 114, No. 1, Australia: Terra Incognita? (Winter, 1985), pp. 147-169.

Harry Frankfurt, ‘On Bullshit,’ Raritan Quarterly Review, Fall 1986, Vol.6, No.2.

W.K. Hancock, Australia, Ernst Benn, 1930.

James Hoopes, ‘Managerialism: Its History and Dangers,’ Historically Speaking: The Bulletin of the Historical Society, September 2003, Volume V, Number 1.

Murray Horn, The Political Economy of Public Administration: Institutional Choice in the Public Sector, Cambridge University Press, 1995.

Michael Pusey, Economic Rationalism in Canberra: A Nation-Building State Changes its Mind, Cambridge University Press, 1991.

John Ralston Saul, Voltaire’s Bastards: The Dictatorship of Reason in the West, Vintage Books, 1994.

James Q Wilson, ‘The Rise of the Bureaucratic State,’ Public Interest, Fall 1975, 41:77.

1. This refers to use of the revenue of the organisation. The total revenue or budget of the organisation is rarely, if ever, controlled by the managers themselves. In some circumstances, they can influence the level of demand for the services of the organisation, but this effect (which can be significant) is nevertheless indirect.