Bureaucrats and Bureaus
Once a governmental unit has decided how much of a public good to produce and how to pay for it, the legislature and the executive branch (president, governor, mayor) usually turn the job of supplying the good over to a bureau—a government agency or department. In a few cases, governmental units simply purchase privately supplied goods with tax revenue. A classic case of using private suppliers exists in Scottsdale, Arizona, where part of the fire protection is privately supplied and part is provided by the local government. Garbage removal is privately supplied in many communities. Often, however, a bureau is responsible for production of a good in the public sector.
The role of bureaus and bureaucracy creates many problems in supplying public goods. It is extremely difficult, if not impossible, to monitor the efficiency of a bureau. Bureaus do not usually produce measurable outputs. Instead, they produce services. For example, a bureau might produce fire protection, education, or defense. When legislatures monitor these activities, they tend to examine spending rather than measure outputs. Citizens, however, are more interested in output levels and quality of service. Sometimes there is a partial measure of output, such as the number of students educated or length of response time for firefighting units. But how can the value of the output of the U.S. Department of Defense be measured? The value of output must usually be inferred from the activity of the bureau, and that activity is most often measured by the level of expenditure. Thus, complaints about the quality and quantity of education or defense are generally reduced to calls for increased spending on the activity itself.
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