Policy Stages - Agenda Setting

This is the first of our chapters on the policy stages. In this chapter Peters covers the "first" two stages of the policy process (remember, stages theory is a tool to help us think about policies, and in reality the stages aren't so neat and orderly). Agenda setting is commonly thought of as the first stage of the policy process. The ability to place items on the agenda for consideration and keep other items off is one of the most important powers in the policy process. This is why party control of the House and Senate can be so important. Think about how different some of the issues considered by the Republican House are from some of the issues being considered by the Democratic Senate (this difference becomes even greater when we look at the bills coming out of committees in one house versus the other).

Peters talks about two types of agendas: systemic and institutional. Systemic agendas are broader and more stable over time. They include any issue that has been deemed appropriate for consideration by the public sector. Institutional agendas are much more variable and only include those issues that are under active consideration at the time. While some advocacy groups are trying to move their issues onto the systemic agenda, most are attempting to move their issues from the systemic agenda to the institutional agenda. As you can imagine, at any given time most issues are on the systemic agenda with relatively few issues on the institutional agenda.

A lot of debate in political science and public policy studies concern who sets the agenda. The study of public policy really originated with Robert Dahl's Who Governs, a work that takes a pluralist perspective on policymaking. Pluralism emphasizes a marketplace of ideas. Pluralist theory argues that society is made up of different interest group with many divergent ideas, with government acting as the primary mediator between these groups. Individuals join the groups that advocate for things they care about and act as bystanders on other issues. Policies are ultimately decided by competition, and in the marketplace of ideas the best idea wins. 

While pluralism assumes that all groups have equal power in the marketplace of ideas, elitist theory assumes that policy is primarily made by the wealthy and powerful. C. Wright Mills' The Power Elite is often considered the classic of elite theory, and argues that business owners, politicians, and military leaders all engage in the same circles and work together in their various sectors to distribute power and wealth among themselves. Keeping and increasing the power of those who are already powerful is an important aspect of public policy, from the perspective of elite theory (of course elite theorists generally see this as a problem in democratic societies).Other scholars like E.E. Schattschneider point to the difficulties that the poor have in organizing into interest groups and understanding the public sector.

The State-Centric approach tends to center agenda setting with government actors rather than interest groups or other outside actors. Congressional committees and bureaucratic agencies become the key actors in deciding what government should consider at any given time.

Once we have established who can set the agenda, we move to the question of how issues make it onto the agenda. Of course, this will have a lot to do with the political ideologies, personal values, and rational self-interest of those with the power to set the agenda. Emergencies, life or death issues, issues concentrated in districts of powerful policymakers, and visible issues will all likely be included on the agenda. Mancur Olsen's The Logic of Collective Action discusses how the dispersion of costs and benefits across the population influences which issues are included in the agenda and ultimately passed. Where benefits are concentrated and excludable  and costs are dispersed, policies will generally be placed on the agenda and passed. Where benefits are dispersed and costs are concentrated policies will generally be kept off the agenda. Further, where issues can be tied to older issues, national symbols, and existing solutions, they will often be added to the agenda.

From an economic perspective, government should intervene where we find market failure. The private sector will not provide the optimal level of public goods because there is no way to exclude those who do not pay for the good. Public goods are those goods that are non-rival  (my consumption will not limit your consumption) and  non-excludable (there is no way to exclude those who do not pay for the good). We can think of our Fourth of July fireworks as public goods (within a certain range). The private sector would be unlikely to provide the optimal amount of fireworks because there is no way to exclude those who do not pay to see the fireworks from viewing them. Market failure also exists in the case of externalities. Externalities exist when either the full cost or full benefit of a good cannot be privatized. For example, an economist would likely argue that the lightrail should be subsidized by government (ideally from a road toll or tax on driving fuel inefficient vehicles) because the benefits of reduced traffic and emissions cannot be fully privatized. In this day and age, it is hard to think about goods that are entirely private goods and without any external costs or benefits. 

Once an item is placed on the agenda, the second stage of the policy process begins. Government needs to determine how the issue will be solved through policy formulation. As Peters points out, sometimes this is based more on habit and analogy than theory or scientific evaluation. The bureaucracy, think tanks, interest groups, and legislators all participate in policy formulation (often legislators participate much less than you would assume). Two tools are often used in the United States to formulate policy, Cost Benefit Analysis and Decision Analysis. Both of these tools should be covered in an advanced policy analysis class. Briefly, Cost Benefit Analysis is based on the premise that all actions and goods can be converted into a monetary value, and government should choose the policy with the highest ratio of benefits to costs. Decision analysis takes cost benefit analysis and adds uncertainty. Using decision analysis, the action that is the most profitable or the least costly, given the likelihood that a specific event will occur, should be taken.

My Thoughts on Peters Ch. 7: Budgeting

Although budgeting is rarely included in policy stages theory (and you will see on p. 47 that Peters himself does not include budgeting as a policy stage), it is an important part of the policy process. Sometimes it is considered to be part of implementation and sometimes it is considered part of policy formulation. Either way, the budget is just as important, if not more so, in determining the effectiveness and efficiency of a policy as the authorizing legislation or agency rules. An underfunded program will likely be seen as ineffective and an over-funded program will likely be seen as inefficient.

Peters goes into a lot of detail about types of budgets and approaches to budgeting. A lot of this goes beyond what you really need to know for a public policy class and delves into the management and administration literature. My hope is that you have learned three major lessons from this chapter:

1) The budget process is complex and takes a long time to complete. Planning for budgets begins almost a year and a half prior to when the budget is enacted. It starts with the president's economic advisers, it moves to the agencies, comes back to OMB and the president for review. In early February, the president releases his budget publicly and the action moves to the legislative branch. The appropriations committees in both houses of Congress take the President's release into account and then after hearings and negotiations send their own versions to the floor of their respective houses. Often the president's, Senate's, and House's bills are all very different reflecting the different political ideologies of their leadership. Once the appropriations bills pass both houses, they go to conference where leaders from both houses attempt to eliminate the differences between the two bills. The resulting reconciliation bill is voted on by both houses and goes to the President once it passes. The president can veto, sign, or let pass the bill as a whole. All of this has to be finished by mid-September for a new budget to take effect. It should be no surprise that the deadline is rarely met, particularly when both houses are divided politically, so Congress is often forced to pass continuing resolutions, which fund programs at the same level as the previous fiscal year (remember, fiscal years are October-September).

2) Congress has very little control over a large portion of the budget. Annually, only about 30% of the budget is discretionary spending, the rest can't be changed without substantial, politically unpopular policy change. The remaining 70% includes entitlement programs like Medicare and Social Security and interest on the debt. For more information see the Center on Budget and Policy Priorities' fact sheets on the budget. This means that during all of the negotiations and hearings about the budgets, most of the disagreements and advocacy effort concerns a small piece of the budget pie. Organizations that may be allies during other parts of the year sometimes end up as adversaries during budget debates.

3) The budget, deficit, and debt all suffer from definitional problems. How they are counted and what is included is often strategic, and rarely represents "the truth" of federal spending and debt

4) The system is full of perverse incentives, or incentives that make the process less efficient. The short-term focus, out of date projections, lack of line-item veto, pork barrel spending, overhang, supplemental appropriations, and incrementalism may all lead to budgets that are larger than necessary and an inefficient use of funds.

Of course, this isn't to say that government spending is bad (although there are certainly economists and politicians who would argue that point). There are, however, places where funding could be more efficiently allocated. I want you to keep this is mind when you read the program evaluation chapter. Funding and implementation both have as much of an effect on program performance as the legislation itself.

My Thoughts on Peters Chapter 6

Once again, we return to the story of our naive policy analyst. She has gotten her issue on the agenda, formulated the best policy response, determined the best arena for successful "passage" of her policy, and the policy has been adopted. Now she is done, right? The answer of course is not yet.

A lot of policy scholars focus almost exclusively on the policy formulation and evaluation stages of policy and leave implementation studies to the public administration scholars. Implementation is the administration of the policy, and can be the most important stage of the policy process in determining how citizens experience policy and the success and failure of policies. The study of implementation really took off in the 1970s with the publication of Pressman and Wildavsky's classic Implementation. Their work examines how the failure of Great Society era anti-poverty programs in Oakland, CA can be traced to relationships within and among agencies and citizens. 

When most people think of the policy process in America, they think that the legislature passes a law and the executive branch administers it. The power to determine what should happen in this case lies with the legislature. From this perspective, when the administrator does not carry out the law exactly as the policymaker intended, the result is undemocratic and problematic. In reality, implementation rarely works this way. The political process tends to produce laws with little practical guidance, vague statutory requirements, and often contradictory instructions. Much of the work is left to administrators, who are generally experts in substantive areas, whereas policymakers are not. Of course, this brings up a lot of questions about legitimacy in a democratic country. 

Implementation takes place in agencies, which tend to be hierarchical and bureaucratic. The character of these agencies can make implementation of new policies difficult, even when everyone agrees how to implement them. Max Brooks' World War Z  is a great work of fiction that deals with the same issues that Peters discusses. In the book, Standard Operating Procedures, communication problems, horseshoe-nail problems, and interorganizational problems slow the response to the zombie-pocalypse. Further, the military and CDC treat the zombie plague and war as standard epidemics and wars, which leads to an ineffective response. The author even directly states (through the mouths of his characters) many of the problems with implementation that Peters brings up. I highly recommend reading the book.