Government policies studies

PAD 510, Week 9: Policy Design, Policy Tools, and Decisions

Slide # Topics Narration
Slide 1 Introduction Welcome to Politics, Policy, and Ethics in the Public Sector.

In this lesson, we will discuss Policy Design, Policy Tools, and Decisions.

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Slide 2 Topics The following topics will be covered in this lesson:

General concepts;

Preparing to design policies;

Policy tools; and

Decisions.

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Slide 3 General Concepts Once a problem has been identified and decision makers place the issue on the agenda for active consideration, there is still more to do to move an idea form a successful contestant on the agenda to a fleshed-out policy. As described in a previous lesson, systems models of the policy process call laws, decisions, regulations, and the like outputs of the policy system. Policies regulating environmental health or national security are one type of output; the actual services provided by the government in monitoring pollution or in securing airplanes are also outputs. It is much harder to measure outcomes of all this effort. Both outputs and outcomes are important to measure, but for different reasons. Outputs allow one to figure out how to link resources to the output of an organization. For example, we measure the performance of a university by its graduation rate, time to completion of degrees, and so on. These figures are outputs, not outcomes. Outcomes are the result of what happens when your university graduates all these students and they enter the world. These things are often very hard to measure because they are very difficult to quantify. Keeping track of the career path of every alumnus is quite complicated.

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Slide 4 Preparing to Design Policy At some point in the policy design process, decision makers must explicitly consider five elements of policy design, as listed in the table on the slide.

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Slide 5 Preparing to Design Policy, continued There is a substantial difference between a condition, about which little or nothing can be done, and a problem, about which some sort of private or public action can be taken. The initial debate over policy is, therefore, about whether something really is a problem, to what extent it is a problem, who it affects, and so on. The definition of the problem often shapes the way the problem is treated throughout the policy process. For example, was Hurricane Katrina an act of God, about which little or nothing could have been done before the event, or was the hurricane less a meteorological phenomenon and more a focusing event that worsened and called attention to social and technological problems than can be mitigated or avoided through appropriate public policy? The post-Katrina debate seems to have adopted the latter interpretation, yet, in the past, and even in many places today, the act of God interpretation is powerful.

We generally know about public problems through two mechanisms. In one, we learn about problems through changes in the indicators of a problem over time, rather than all of a sudden. For example, in 2009, swine flu gained attention as a public policy problem when it first came to light in cases in Mexico, whereupon it spread to the U.S. and then worldwide. Other problems become evident through focusing events, which are sudden events such as earthquakes, terrorist attacks, or industrial accidents. Another class of focusing event is the kind of event that affects a particularly influential member of a policy community. It is well known that when famous people contract diseases, or when a member of Congress or his or her family members have or contract a disease, more attention is paid to the problem than would ordinarily be paid.

It is essential to understand that problems don’t merely exist in the world in a self-proliferation way. For example, one can argue that childhood obesity is caused by the proliferation of junk food and video games, all of which lead to poor diets and sedentary lifestyles.

Nearly all the other aspects of policy design will flow from this definition of the problem; one can imagine policies that are intended to regulate junk food and video games, or policies that encourage activity through better urban form, or through public education. Each of these policies assumes different casual theories and therefore will suggest different policy tools.

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Slide 6 Preparing to Design Policy, continued Policies are made because someone has persuaded enough of us that something needs to be done about a problem. Policies are created to meet or at least to make progress toward these goals; policies to fund research on vaccines and to mandate their use by children; policies to provide a social safety net for the poor and others hit by economic downturns; and policies to create jobs. All of these policies are linked to perceived problems and goals.

There are many ways to think about and categorize goals. A particularly useful way of thinking about goals is found in Deborah Stone’s Policy Paradox. Stone lists four major categories of goals: equity, efficiency, security, and liberty. Each of these goals conflict with one another in several ways and these conflicts are intensified by the many different definitions of goals. Stone helps us to understand this by listing eight different ways of defining equality, an example of dividing a cake. One might argue that the most equitable division is to simply count the number of people in the room and divide the cake into that number of pieces. But Stone argues that one can divide the cake by rank, athletic or physical prowess, or by gender and still justify the decision for dividing resources as equal.

Consider traditional American notions of equality, in which we claim that we believe that everyone should have equal opportunity for success but no guarantee of equal outcomes, particularly when the opportunities themselves are not equal. Before women were given the right to vote and other civil rights, men, and some women, argued that women were the fairer sex who were unsuited to physical labor or even rigorous intellectual pursuits; they were deemed best at homemaking. African-Americans were considered nonpersons and therefore unsuited for anything like equality; and today, gays and lesbians are considered sufficiently different from others that they are unable to marry or, in some jurisdictions, to establish families and to share health insurance and other workplace benefits.

Stone notes that arguments that seek to exclude people from the recognized boundaries of community are often invoked to deny some form of equality to these people. The current red-hot debate in the U.S. over the treatment of illegal immigrants is a case in point.

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Slide 7 Preparing to Design Policy, continued Stone argues that efficiency is more a means to a goal rather than a goal itself, but she treats efficiency as a goal category because many policy advocates tout their ideas on purported improvements in efficiency. Efficiency is a particularly important aspect of policy making in the United States, given our emphasis on limited government and individual initiative and in the context of calls for the government to run more like a business. If the efficiency of a program improves by ten percent, spending on the program could be reduced by ten percent without a loss of benefits. This sort of thinking is comparable, particularly among those who support smaller government or who wish to shift resources to other programs. There are many different ways of understanding efficiency, depending on how we describe inputs and outputs. Stone argues that governmental activities provide inputs and outputs. She cites an example of how we might define efficiency in a public library system. While librarian’s salaries can be seen as inputs, their earnings have a small but discernible impact on the community and therefore also serve as outputs.

Stone states that society can be viewed as a market or as the polis, the essential political society, the community as a whole. The decisions we make to address our common problems are usually political rather than market based. Clearly, if more people and interests are taken into account in the polis than in the market, we could reasonably argue that the polis model is more complex than a simple market model. If this is true, then efficiency in political terms is quite complex, as hard to define in just one way as equity is. For example, it is traditional to think about governmental administrative costs as wasted or overhead expenses that take resources away from more useful activity. However, merely calling something administrative as opposed to productive is a way of prejudicing the argument. For example, to distinguish core instructional activities from administrative activities, New Jersey planned to cut administrative costs by imposing penalties on schools with excessive administrative costs; the plan would categorize school librarians, nurses, and guidance counselors as administrative. By categorizing these positions as administrative, New Jersey was sending a signal that the responsibilities of these positions do not contribute to the goals of the school.

In any case, classifying these activities as administrative in order to achieve some level of efficiency is more a political decision than an objective economic or accounting decision. Because it is a political decision, one then can use political rhetoric to counter the proposal. This is not to say that one cannot or should not use economic or accounting data to make a case for or against moves to create efficiency.

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Slide 8 Preparing to Design Policy, continued Two other goals that seem to conflict are security and liberty. Clearly, there are significant conflicts between these two goals: the more security one desires from the government, the more liberty one must be willing to surrender. Thomas Hobbes argues that people are naturally aggressive and that they want to acquire things for themselves. They will, therefore, in the state of nature, seek to deny those things to or take from other people. Thus, people in the state of nature will fight with each other for wealth and power, and this constant striving will yield constant war of man against man, resulting in a society in which life is solitary, nasty, brutish, and short. To prevent this conflict, Hobbes argues that all of us in civil society have surrendered a considerable number of our liberties to the state, which holds the most coercive power in our name to prevent us from engaging in this war against all. If we take Hobbes at his word, we might create an authoritarian or totalitarian system to protect ourselves from each other. Instead, we created the Constitution. We surrendered to the government only those things that we believe government should manage to create and maintain a civil society.

The problem with this trade-off is that greater security for some or all of us comes at the expenses of a loss of liberty to some or all of us. First, consider your willingness to surrender some of your rights in exchange for more aggressive law enforcement. Now, let us imagine that the police search your house without a search warrant, a violation of the Fourth Amendment, to yield evidence that someone in your house committed a crime. Then the evidence is what lawyers call probative in that it shows that the individual may have committed a crime for which he or she should be punished. Should the evidence be admitted at trial because it is proof of guilt? Or should it be excluded because it was seized in violation of your constitutional rights? These questions are not easily and definitely answered, because they are important political questions that both influence and reflect the nature of the political community involved in the nature of the information available to people when they make these decisions about liberty.

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Slide 9 Preparing to Design Policy, continued Beyond the different ways of thinking about goals, policy design can also reveal conflict over policy goals. Because policies and their goals are often vague when they are originally established, it is sometimes difficult for the agencies charged with implementation to satisfy the demands for everyone involved in formulating and approving the board policy. For example, Congress could mandate that the secretary of the Department of Health and Human Services create a program to reduce teen pregnancy rate. There may be other goals, such as welfare dependency, increasing educational attainment, and other benefits that derive from this, but the main goal is to reduce the teen pregnancy rate. Despite the methods to reduce the teen pregnancy rate, any of the methods selected to reach the goal will raise controversy. We might call this conflict an agreement on ends, but not on means. The reason for the agreement on the ends in the first place is due to contending groups’ interests in attaining their own goals. Social conservative groups may see the reduction of teen pregnancies as meeting a moral goal, while liberal groups may view the same result as a step toward particular social goals. Both groups can agree to the goals while feeling that their own interests, social or moral goals, are thereby promoted. The disagreement comes later, when the decision is implemented; that is, when an agency takes specific steps to lower teen pregnancy rates, such as distributing contraception or promoting abstinence.

Some goals can conflict with other goals. Because the United States has so many illegal aliens living within its borders, its immigration policies have failed. On the other hand, the United States wants to maintain friendly relations with Mexico, the source of most of our illegal aliens. A crackdown on illegal immigration may create social, economic, and political problems in a nation whose cooperate we hold to cultivate. Another goal is to keep food prices down; many argue that illegal immigrants, because they accept lower wages for farm work that legal citizens choose not to do, help keep food prices low.

Often, once conflicts are resolved and the means for achieving goals are developed, one is able to, through a review of the record surrounding the enactment of a policy, isolate the important goal or goals and assess the extent to which they are met or believed to have been met.

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Slide 10 Preparing to Design Policy, continued If the participants in policy making can at least approximate goal consensus, then the next thing they must do is understand the causal theory that underlies the policy to be implemented. A causal theory is a theory about what causes the problem and what intervention would alleviate that problem. Without good causal theory, it is unlikely that a policy design will be able to deliver the desired outcomes. Rather, performance measurement will remain focused on effort, because implementers and researchers will find the connection between effort and outcome so difficult to make.

If the laws made by the legislators are vague or if the legislature defers to the expertise of agency officials, then developing the best causal theory and then settling on the policy design are the responsibility of the agency staff. But if Congress specifies a particular decision or set of solutions to a problem, then the causal theory is implicit in the legislation. Because social problems are very complex, it is not surprising that developing causal theories about how the social world works is very difficult. If one develops the wrong causal theory, no policy, no matter how well crafted, is likely to have a positive impact on the problem under consideration.

Deborah Stone finds that isolating the causes of problems is much more complex than opposing campus might believe at first glance. We can distinguish between cause and effect in the natural world and in the social world: the natural world is the realm of fate and accident, and we believe we have an adequate understanding of causation when we can describe the sequence of events by which one thing leads to another. On the other hand, in the social world, we understand events to be the result of will, usually human but perhaps animal. The social world is the realm of control and intent. Thus, an important way of understanding how people argue about causes is to look at whether they attribute a problem to an act of God or to acts of human causation, either purposive or negligent. It is the presence of human activity that decides to build houses too close to rivers or on grounds that do not stand up to high winds. Stone argues we can take this analysis further and consider action and consequences.

This move between explanations is important because the causal theory strongly implies the appropriate actions that government and society might take and that may be codified in public policy. These causal theories imply what sorts of policy tools will be used to address the problems.

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Slide 11 Check Your Understanding
Slide 12 Policy Tools Closely related to causal theory is the choice of policy tools, or policy instruments, which can be used to create a desired outcome. Schneider and Ingram define policy tools as elements in policy design that cause agents or targets to do something they would not do otherwise or with the intention of modifying behavior to solve public problems or attain policy goals. We create categories of tools because while there are many different government policies, there should be relatively few types of tools used to achieve the goals set out in policy.

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Slide 13 Policy Tools, continued According to Salamon, the nature of the world and the nature of government have changed. Salamon notes that in recent years there has developed a set of theories that portrays government agencies as tightly structured hierarchies insulated from market forces and from effective citizens pressure and therefore free to serve the personal and institutional interests of bureaucrats instead. Salamon continues that governments have already begun to restructure to take into account the reform theories intended to make government more nimble and responsive to modern needs. Thinking about tools is particularly useful because they are central characteristics of tools that distinguish some tools from others. The key would then be to find the central characteristic of the various tools by looking at the four dimensions noted in the table on the slide.

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Slide 14 Policy Tools, continued Bennett and Howlett provide two broad categories of policy tools: economic and political models. Economic models focus on individual freedom, initiative, and choice, therefore tending to value non-coercive tools over those that are more coercive. Note that welfare economists, whose focus is on overall societal well-being rather than the aggregation of individual well-being, do acknowledge the need for more coercive tools to correct some of the flaws of laissez-faire economics. By contrast, those who look at policy tool choice from a more political perspective tend to follow this precept: Any instrument or tool can theoretically accomplish any chosen aim, but governments prefer less coercive instruments unless forced by either defiance on the part of the subject and/or continued social pressure to change to utilize more coercive instruments. If the selection of how to deal with a problem is at least partially a function of societal pressures to favor one policy tool or another, then politics is involved not only in the understanding of the problem, but also in the ways we choose to solve it.

The matter of substitutability of one tool for another is not so simple, because political systems are constrained in their choice of tools, both ideologically and legally. On the legal side, federal policy making on any number of issues is predicated on the notion that government could regulate a wide range of activities under the commerce clause of the Constitution.

A potential problem with the economic way of thinking is that economics often makes too many assumptions about what is possible in policy making, on two levels. First, it assumes we really know what the problem is. In the give-and-take of policy making, an agreement to do something about a problem is often easier to achieve than an agreement on what precisely has to be done. This challenge is faced by those who write regulations and seek to implement government policies without creating controversy and disagreement over the means to the ends specified by the policy makers. Second, economic perspective assumes that we have reasonably reliable information on how policy tools work. As with much of politics and policy making, it is very hard to know the causal connections in any policy system.

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Slide 15 Policy Tools, continued Policy designers must consider a number of elements when selecting a policy tool. One of these elements is political feasibility. Because policy making is at least as much a political process as it is a technical process, even technically superior policy tools may not be adopted because they are politically unpopular. A second factor in the policy tool choice is the resources available to implement policy. The resource question falls within a broader category called administrative feasibility or the degree of ease or difficulty involved in establishing and operating a program. A third element is based on the behavioral assumptions about the target populations. Policy targets are the entities, people or organizations, whose behavior the policy seeks to alter. This falls under the category of effectiveness, which can be assessed as supply effectiveness or targeting effectiveness.

It is important to keep in mind that multiple policy tools are used to address a problem. It is the tendency to bundle policy tools into packages of tools that are all intended to achieve similar goals, which shows that certain types of economic development tools are likely to be bundled into an overall strategy.

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Slide 16 Decisions Once a tool or set of policy tools has been narrowed down, policy makers need to decide which policy tool or set of tools to use; someone or some institution in the policy process has to make a decision. Decisions can be about complex matters as who should send an astronaut to the moon or simple as the decision by a police officer to give a warning rather than a speeding ticket. Indeed, our constitutional system is structured in a way that often prevents decisions from being made. The numerous points that bills must pass before they become laws, that proposed regulations must pass before they come actual regulations, and that laws must pass before they are effectively implemented make any sort of final and authoritative decision very difficult to reach. Thus, when analyzing policies, it is as important to specify what has not been done as it is to specify what has been done.

Decision-making process begins after an issue or problem is placed on the agenda and makes its way through the legislative process until it comes close to the decision agenda. The decision agenda is that relatively small collection of things about which an organization must make decisions. In Congress’s case, the process usually begins by narrowing down a set of alternatives that are, for the most part, debated and formulated in the committees. The goal is to link potential problems to potential solutions.

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Slide 17 Decisions, continued For years, the rational actor model was widely assumed to be a primary method of decision making in public and private organizations, and the quest for this sort of rationality persists today. There are several assumptions that underlie the rational model. Decision makers are presented with a problem and a goal and are set to the task of solving or addressing, to the extent possible, the problem. In doing so, decision makers gather all the possible information they can on the problem, its societal and economic costs, and on possible solutions. Multiple options are analyzed, including the option to take no action at all.

Several features of the rational model render it an unrealistic model of decision. First is the problem of goal consensus. Often, when a problem is identified, it is hard to understand what goals the various proponents of policies have in mind. Often goals are left purposefully ambiguous so that legislation can gain passage; it is then left to the implementers to try to figure out what the most important goals are. Second, the information-processing demands are too great for human minds in human institutions. It is impossible to gather all the information about a particular problem. Even with today’s vastly improved information storage and retrieval systems, it is very difficult for decision makers to gather all the information needed, weigh the information, and make a decision. Last is the nature of the information itself. Because decision makers deal with social phenomena, and social phenomena are notoriously difficult to track and analyze, it is difficult to find the proper information about goals, values, costs, and benefits needed to make a rational decision. This is one of the key criticisms to the cost-benefit analysis, or CBA. In CBA, the analyst tries to count up, often in monetary terms, the cost of pursuing a certain policy and the benefits to be derived from it. The problem is that the costs of an action are sometimes easier to count up than are the benefits.

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Slide 18 Decisions, continued Bounded rationality is a way of thinking about rationality that recognizes the limits on resources and human abilities to process information. To be bounded rationally means that one behaves as rational as one can within certain bounds or limits, including limited time, limited information, and our limited human ability to recognize every feature and pattern of every problem; we can try to enhance these skills, but they are still inherently limited. Lindblom argues that people make decisions in relatively small increments, rather than in big leaps. They do so because key sources of information include what we know about the current nature of an existing problem, our accumulated knowledge about what steps have been taken before, if any, to address the problem, and whether those steps appear to be successes or failures.

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Slide 19 Decisions, continued This description of the policy process, known as incrementalism, is both a model of how decisions are made and a description of how contending interests behave in policy making.

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Slide 20 Decisions, continued Lindblom calls the rational comprehensive method of decision making the root method because decisions start from the root of the issue or problem; incrementalism is the branch because it uses and builds on what is already known, without relying on reanalyzing everything about what is currently being done. In this way, the incremental method allows the decision maker to take a fair number of shortcuts: it eliminates the need to explicitly separate means from ends, to pick the analytically best policy, and to rely heavily on theories that the decision maker may have neither the time nor the inclination to use.

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Slide 21 Decisions, continued There are two major problems with incrementalism. First, some problems demand bold decisions and second, that some goals simply cannot be met with incremental steps.

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Slide 22 Decisions, continued Another model is the garbage can model to explain decision making in what you call organized anarchies. There are three streams in this model: problems, solutions, and participants. In each of these streams, various elements of decision making float about: what is perhaps most important about this model is the idea that there are solutions looking for problems as much as vice versa, and participants floating about looking for a way to participate in putting together these problems and solutions. They are called garbage cans because the three streams are mixed together. It is important to note that this is not a model in which a problem is identified, followed by people going out to develop or invent solutions and bring them back. Rather, many solutions already exist, and the role of participants is to advance their solution to a problem, even when it seems that they are simply carrying a solution in search of a problem.

Two other models are organizational process and government politics. Organizational process is a model of organizational process grounded in a notion of bounded rationality. These decisions are the result of bureaucrats applying standard operating procedures to problems. Government politics is a model of political conflict. Decisions in this model are the product of competition and negotiation among the president, top government executives, bureaucrats, legislators, and other interested parties.

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Slide 23 Summary We have now reached the end of this lesson. Let’s take a look at what we’ve covered.

Policy makers must consider which type of tool to use when designing policies. Goals conflict with each other and policies are often designed without a sound causal theory to help policy makers know whether a particular kind of policy will work. Policy tools and implementation are considered together because they are inextricably linked to each other. The choice of policy tools both influences implementation and is influenced by implementation. Policy makers and the various advocacy groups involved in a policy domain will continue to debate not only the underlying rationale for a policy, but the methods by which the policy is put into effect.

This completes this lesson.

 
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