(Herbert) Simon Says: We do not live in a market economy, but in an organization economy.

As I’ve noted, the ongoing ardent private/public debate has more to do with ideology and the political battles of yesteryear, than with anything to be reflected among either scholars studying the water sector or any interesting debates in the economic community. Yes, markets remain indisputably important, as is their study, but before we get to discussing politics we have to discuss organizations because, as Herbert Simon notes, organizations cover far more of the earth’s surface than markets do.

As we talk about organizations either in the private or the public sector, we are talking about bureaucracies. They are imperfect creatures that attempt to minimize uncertainty through hierarchy and procedure. Yes there are fine distinctions about organizational forms that may be taken under public or private law, but the ideological debates are not based on these. For a case of how meaningless this distinction can be one need look no father than the case of water utilities in Hessen. When faced with a mandatory price reduction from the “Cartell Authority,” the utilities chose to simply change their legal form (in this case from private to public) as this would allow them to avoid the Cartell Authority’s authority and maintain their price structure.
No, rather the debates are about whether given bureaucracies should orient themselves around fiscal or social motives or, as is more likely these days, some mix of both.These debates will go on, but they should not distract us from the fact that no matter what goals are counted or valued, any bureaucracy is at some point likely to fail. And this failure may have significant and previously unforeseen effects on its internal or external stakeholders, or for society at large.

Sometimes this failure can be understood in the language of politics and economics, but more often than not, this failure must also be understood in the language of public and business administration. And it is a dull, boring, unfortunate, but vital language of human affairs. Indeed, if there is something you want to accomplish, put rhetoric in your quiver, pull science from its sheath, but boredom is your armor, if you hope to fight another day:

 “I learned that the world of men as it exists today is a bureaucracy. This is an obvious truth, of course, though it is also one the ignorance of which causes great suffering.

But moreover, I discovered, in the only way that a man ever really learns anything important, the real skill that is required to succeed in a bureaucracy. I mean really succeed: do good, make a difference, serve. I discovered the key. This key is not efficiency, or probity, or insight, or wisdom. It is not political cunning, interpersonal skills, raw IQ, loyalty, vision, or any of the qualities that the bureaucratic world calls virtues, and tests for. The key is a certain capacity that underlies all these qualities, rather the way that an ability to breathe and pump blood underlies all thought and action.

The underlying bureaucratic key is the ability to deal with boredom. To function effectively in an environment that precludes everything vital and human. To breathe, so to speak, without air.

The key is the ability, whether innate or conditioned, to find the other side of the rote, the picayune, the meaningless, the repetitive, the pointlessly complex. To be, in a word, unborable.

It is the key to modern life. If you are immune to boredom, there is literally nothing you cannot accomplish.”

― David Foster Wallace, The Pale King

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