Government Administration

Published in Los Tiempos, October 26th, 2019.

Public administration or management is very important. The government employs 13.8% of people in the Netherlands, 21% in the United Kingdom and 19% in Ecuador. In Bolivia, people from various cities depend on public management work between 20%  (Santa Cruz) and 80%  (La Paz). Therefore, it is obvious that management is important. However, many governments seem to forget that at the end of the day they have to show results to show that this participation has a more efficient and effective process. For governments, it is a temptation to create jobs by inventing public companies that motivate both the economy and its political power, achieving adherents. But when the position created does not generate greater benefit than the costs of its operation, the damage to the economy is bigger than the creation of employment.

A company continuously invests in technology to improve the quality of service and reduce the number of people working to improve their productivity. For example, the creation of a Banking App. The bank is motivated to be competitive, and if it does not, it will go bankrupt. This decision is more complicated for a government. First, they have no competition. Second, the resistance to change of bosses is to not make life complicated or to fire people and thus stick to the old processes. And, the government looks bad when they fire people. Even many governments remain in power thanks to the large number of jobs they have and this stays in the mind of people “supporting a party gives you more chance of work.“

Therefore, it is clear that government companies are not well managed and can cause great losses for the economy. A job must give results, and these should be measured periodically. For the public administration, the main objective should be to achieve more in a more productive and quality way. For example, less sick, better schools, more security, better infrastructure with more technology, etc. For this measurement, public management has several tools that can demonstrate numerically the utility with respect to expenses. In business administration we do it daily for each activity optimizing the use of resources. This should be used more in governments to be more efficient and effective.

Economist Ludwig von Mises said: “There is no threat more dangerous to civilization than a government of incompetent, corrupt or vile men” In other words, if a government does not have people capable of competitively moving towards quality, they may be ruining the present and future of a country.