Public Value Theory and Budgeting: International Perspectives 9780367077693, 9780429022722

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Public Value Theory and Budgeting

Public value theory has advanced over the past 30 years, but there is a need to extend its boundary outwards into new contexts and update its discourse to reflect new social challenges. We are now trying to create value in a globalized world, with supranational entities, with new international alliances and institutions, in a frightening post-truth era. How can public managers grapple with these emerging realities? This book seeks to provide answers to such public value questions by applying powerful budgeting perspectives. Using case studies of independent budget offices, key fiscal instruments, and leading public value frameworks, this book stands out in its use of budgetary lenses to answer pertinent questions about the multidimensional processes of value creation by and for a wider society. Pushing the debate on public value forward and taking it onto the global stage, the book asks whether public value (and other public administration theories) are applicable beyond the traditional context of the pro-globalization Western liberal democracies in which they were conceived. It does this by exploring the realms of developing countries, supranational entities, and post-Communist societies, among others. Finally, it presents these explorations in light of very recent sociopolitical trends and phenomena, including the growth of civil society, the global financial crisis, the illiberal democracy, and the post-truth era. Tailored to an audience comprising public administration scholars, students of government, budget practitioners, and social scientists interested in contemporary problems of values in society, this book helps to advance public administration thought by extending public value theory into new contexts and relating it to the growing global challenges of public life. Usman W. Chohan, PhD, is a public value theorist and a post-doctoral fellow at the University of New South Wales, Australia. He has previously served at the National Bank of Canada and the World Bank. He was included among Australia’s 50 Top Thinkers by the Conversation in 2016. He has resided in ten countries on five continents and is President of the International Association of Hyperpolyglots, with fluency in eight different languages. His previous research has been cited in parliamentary reviews and motions in Australia and Canada. He has been a Global Shaper of the World Economic Forum and is today included among the leading Business Authors in the rankings of the Social Science Research Network.

Routledge International Studies in Money and Banking

95 Money, Markets and Capital The Case for a Monetary Analysis Jean Cartelier 96 Monetary Equilibrium and Nominal Income Targeting Nicolás Cachanosky 97 Distance, Rating Systems and Enterprise Finance Ethnographic Insights from a Comparison of Regional and Large Banks in Germany Franz Flögel 98 Financial Markets of the Arab Gulf Power, Politics and Money Jean-François Seznec and Samer Mosis 99 Performance Measurement Systems in Banks Rahat Munir and Kevin Baird 100 Financial Literacy in Europe Assessment Methodologies and Evidence from European Countries Gianni Nicolini 101 Money, Inflation and Business Cycles The Cantillon Effect and the Economy Arkadiusz Sieron´ 102 Public Value Theory and Budgeting International Perspectives Usman W. Chohan For more information about this series, please visit: www.routledge.com/series/ SE0403

Public Value Theory and Budgeting International Perspectives

Usman W. Chohan

First published 2019 by Routledge 2 Park Square, Milton Park, Abingdon, Oxon OX14 4RN and by Routledge 52 Vanderbilt Avenue, New York, NY 10017 Routledge is an imprint of the Taylor & Francis Group, an informa business © 2019 Usman W. Chohan The right of Usman W. Chohan to be identified as author of this work has been asserted by him in accordance with sections 77 and 78 of the Copyright, Designs and Patents Act 1988. All rights reserved. No part of this book may be reprinted or reproduced or utilised in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers. Trademark notice: Product or corporate names may be trademarks or registered trademarks, and are used only for identification and explanation without intent to infringe. British Library Cataloguing in Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging-in-Publication Data A catalog record has been requested for this book ISBN: 978-0-367-07769-3 (hbk) ISBN: 978-0-429-02272-2 (ebk) Typeset in Bembo by Taylor & Francis Books

To Kerry Jacobs, Ars longa, vita brevis To Satish Chand, Amicus est tamquam alter idem

Contents

List of illustrations About the author Preface Acknowledgements List of abbreviations 1

Introduction

x xii xiv xvi xviii 1

A portrait of public value 1 What is a budgeting lens? 7 Tools for budget analysis 8 The three-fold aims of this book 11 The structure of this book 12 PART I

Extending public value to new contexts

19

2

21

Public value, civil society and developing countries Introduction: value for and from the citizen 21 Revisiting civil society in public value theory 23 Why citizens budgets as a lens? 26 The South African citizens’ budget 29 Conclusion: theorizing civil society in public value 34

3

Supranational entities and defining the “public” in public value” Introduction: e pluribus unum? 40 Defining the “public” in public value 42 The problems of a supranational “public” 44 1 Incentivization problems 44

40

viii Contents 2 Imbalances between national publics 48 3 Surrendering tools to supranational public managers 49 4 Loss of trust 51 Testing for supranational public value 52 Conclusion: seeking a composite public 57 4

Public value in post-communist societies

61

Introduction: the horizon of transitions 61 Assumptions underpinning public value 61 Post-communist limitations 62 Common threads 63 Budget transparency in a post-communist context 66 Evaluating budget transparency 70 Conclusion: beyond “odious” elements 72 PART II

Challenges in public value creation

77

5

79

Public value and illiberal democracy Introduction: the illiberal persuasion 79 The illiberal democracy 80 1 Venezuela 83 2 Hungary 86 Public value challenges in illiberal democracies 88 Conclusion: illiberal arbiters 92

6

Public value between nations

95

Introduction: shared values, different administrations 95 Is public value a domestic theory? 97 What values underlie OBOR? 98 Bilateral value creation 101 Conclusion: Silk Road and Milky Way 105 7

Public value and the post-truth era Introduction: the post-truth zeitgeist 109 The problem of the public manager in the post-truth era 111 The Congressional Budget Office and the American Health Care Act 114

109

Contents

ix

The salience of public value in a post-truth world 123 Conclusion: the re-legitimization of public managers 125 8

Conclusion

129

A threefold approach 130 New contexts 131 Budgeting as a public value lens 132 Grappling with public value challenges 135 The wider world of value creation 136 Reciprocity, limitations, and future research 136 Index

144

Illustrations

Figures 1.1 The analogous representations of the budget process and public value theory 1.2 Map of countries covered in this book 2.1 The roles of civil society in public value 3.1 Do supranational public managers lie outside national public value? 3.2 Supranational managers and surplus recycling mechanisms 3.3 Surrendering operational capabilities to supranational managers 5.1 Public managers in illiberal democracies 6.1 International and domestic negotiation processes occur in parallel 7.1 The twofold impact of post-truth public managers 8.1 The analogous representations of the budget process and public value theory

7 12 25 46 49 50 89 104 118 134

Tables 1.1 Criticisms and questions about public value 1.2 Budgetary tools in this book 1.3 Systematically approaching public value questions through a budgetary lens 2.1 International Budget Partnership overall transparency rankings (2015) for the top 10 performing countries 2.2 IBP rankings for public (citizen) participation in the budget for select countries in the Southern African region (2015) 3.1 The problems of a supranational public 3.2 Ingredients for an advisory role and a costings role in public value (EFB) 3.3 Assessing the European Fiscal Board through Moore’s strategic triangle 4.1 A convergence of public value theory with the experience of postcommunist institutions

5 9 13 33 34 45 55 56 64

Illustrations 4.2 IBP’s Open Budget Index: summary statistics for select countries (2015) 5.1 Assessing the OAEF and HFC through Moore’s strategic triangle 6.1 Selected Chinese values underpinning OBOR and CPEC 6.2 Strategic triangle and public value shortcomings in Pakistan 7.1 Ingredients for an advisory role and a costings role in public value (CBO) 7.2 The strategic triangle and the post-truth CBO 8.1 Systematically approaching public value questions through a budgetary lens

xi 71 91 99 102 121 122 137

About the author

Dr. Usman W. Chohan (b. Manhattan, New York) is a public value theorist, and an authority in research within a specialized subfield of legislative studies known as “parliamentary fiscal scrutiny”. He has also been a Global Shaper of the World Economic Forum (WEF). His work has been to inform the parliamentary reforms of legislative budget offices in Canada and Australia. Dr. Chohan is also a postdoctoral fellow at his alma mater of UNSW Australia, where he also completed his PhD in Economics on a full scholarship, having created the world’s first multidisciplinary synthesis of independent legislative fiscal institutions. Dr. Chohan has also previously studied at McGill University, Western University, and Tsinghua University. Dr. Chohan is ranked among the top ten out of the 12,000+ business authors and among the top 40 out of the 370,000+ academic authors in readership over the past 12 months (as of December, 2018) on the Social Science Research Network (SSRN), which is the world’s top open-access knowledge repository. He launched a discussion paper series on cryptocurrencies that includes some of the most read papers on SSRN since 2018. In 2016, Dr. Chohan was included in The Conversation Yearbook 2016: 50 Standout Articles from Australia's Top Thinkers (Melbourne University Press, 2016). Dr. Chohan also collaborates with international think tanks, notably the Centre for Aerospace and Security Studies (CASS), the Critical Blockchain Research Initiative (CBRI), the Development Policy Institute, and the Tax and Transfer Policy Institute (TTPI). In his personal life, he meets an annual goal of reading 110 books per year and diligently catalogues his progress on Goodreads. He has previously been a consultant with the World Bank (Social Accountability, WBI), working on issues of fiscal governance reform and, specifically, the implementation of independent legislative fiscal institutions (IFIs) to help bring impartial and nonpartisan financial expertise into global governance systems. He is a Global Advisory Board Member of Economists Without Borders. Earlier on, he served as the Special Situations Analyst in the Global Equities Team at Natcan Investment Management, the investment arm of the National Bank of Canada. The Global Equities team had six global investment professionals, including Usman, and $3 billion dollars in Assets under Management (AuM).

About the author

xiii

Dr. Chohan is the serving president of the International Association of Hyperpolyglots (HYPIA), which receives individuals who speak six+ languages fluently, and is himself fluent in seven Indo-European languages (English, Spanish, French, Portuguese, Hindi, Urdu, and Punjabi), while also conversant in various others. Given that his last six residences were in cities on five different continents (Montreal, Buenos Aires, Islamabad, Canberra, Warsaw, and Beijing), you will likely find Dr. Usman W. Chohan roaming somewhere between these six coordinates across the earth.

Preface

The unrelenting urge to write this book arose during the process of my doctoral work at the University of New South Wales (UNSW) in Canberra, Australia. Looking at public value theory as a lens to resolve a multidisciplinary problem in the realm of budgeting, I came to realize that there was a powerful opportunity to develop a series of important dialogues that would weave together two seemingly disparate worlds – public value theory and budgeting – in a manner that would advance both. In other words, I came to see an element of symbiosis between public value theory and the lens of budgeting that I felt merited much further scrutiny. On the one hand, public value could help to address questions faced by budgeting institutions, such as about their roles, their anomalies and inconsistencies, and even their future development. On the other hand, budgetary experiences could shed light on the criticisms lodged against public value theory from several academic corners. Two of the chapters in my doctoral thesis, including the chapter that provided the solution to the research question, were steeped in public value theory, and addressed two criticisms of public value: (1) public value in politics: that public value is “incompatible” with democratic politics, and (2) public value as rhetoric: that it was largely a supposed rhetorical ploy underpinning a power-grab by public managers. Both chapters were published separately in The International Journal of Public Administration; later, their ideas also appeared in two separate encyclopedic chapters within The Global Encyclopedia of Public Administration, Public Policy, and Governance. These publications helped to underscore in my eyes both the potential of public value theory and the novelty of deploying case studies of budgeting to advance the public value literature. For a variety of reasons, including a pernicious sense of boredom while living in Canberra, but also the tremendous support of two excellent supervisors at UNSW, Professor Satish Chand and the late Professor Kerry Jacobs, I had in fact completed my dissertation ahead of the minimum three-year deadline for a PhD. It was in that interim period, between writing the thesis and submitting it, that I began to plot the various chapters that would comprise this book.

Preface xv Reaching out with a proposal to Routledge before my doctoral degree was awarded, I was and still am ever grateful to them for their timeliness in assessing my proposal and extending the advanced contract to write this book. In sum, this book is the culmination of ideas that emerged during a doctoral enterprise but take that limited body of work to a much fuller level of enquiry. It is my pleasure to have seen so many ideas within public value theory subsumed into a single work, and to have advanced the public value literature, however slightly, on so many fronts. Dr Usman W. Chohan UNSW, Canberra, Australia January 5, 2019

Acknowledgements

The journey of writing a comprehensive book in any academic discipline, while often crediting the efforts of individuals, is just as much a collective effort to mobilize ideas and advance the boundary of intellectual enquiry. This book is no less the product of both the tacit and overt support of many people, without whom this book would not come to fruition. My mother and father, Naela and Musa Chohan, both deserve the first mention for their continued support throughout the writing phase. In particular, my mother’s inner strength sets the highest example for human willpower in the face of adversity, and her equanimity and patience have bestowed a lasting inspiration on me that I have channeled in all aspects of life, including the writing of this book. The late Professor Kerry Jacobs, my friend and doctoral supervisor, was instrumental in pointing me towards the public value discourse at a very early juncture in my doctoral enterprise. Professor Satish Chand, my co-supervisor, played a supportive role in having my doctoral work seen through to completion, and then helped me to continue the postdoctoral phase during which this book was prepared. Professor Frederick Stapenhurst, in his role as a mentor, guided me towards the doctoral enterprise in the first place; and in having shown me the sublime worth of academia, I remain infinitely in his debt. Three other scholars who set an example through their work and their encouragement also warrant mention: Professor Ali Farazmand of the International Journal of Public Administration; Professor James D. Savage, who was also one of the examiners of my thesis; and Professor Michael O’Donnell of UNSW Canberra. Their feedback across several projects has proven invaluable. Dr. Aron P. D’Souza also merits particular mention for his lasting and strong friendship, and for continually engaging me with interesting intellectual challenges. Further recognition must go to the founders and directors of the new Centre for Aerospace and Security Studies (CASS), in Islamabad, Pakistan, including ACM Kaleem Saadat, AM Shahid Alvi, AM Wasim-ud-Din, AM Javaid Ahmad, and AVM Sohail Malik. CASS will come to embody an institute of great regard and esteem in the years to come, inshallah. I am also grateful to Routledge for the excellent way in which every phase of this book project has been managed. I hope this book is but one of many future collaborations.

Acknowledgements xvii A final expression of gratitude goes to my better half, Joanna Koper, whose caring and loving nature led her to raise my needs and considerations above her own, and with whom I have forged a true partnership of love and companionship that extends to all aspects of our lives.

Abbreviations

ACA AJPA AHCA BCRA BEMF BFMA BPD BRI CABRI CBO COSATU CPEC DAO EC ECB EFB EU FC GFC GIFT HFC IADB IBP IFI IJPA LBO LTP NCG NGO OAEF OBI

Affordable Care Act (2010) Australian Journal of Public Administration American Health Care Act (2017) Better Care Reconciliation Act (2017) Budget and Expenditure Monitoring Forum Better Financial management Act (South Africa) Batho Pele Document (South Africa) Belt and Road Initiative Collaborative Africa Budget Reform Initiative Congressional Budget Office (US) Congress of South African Trade Unions China-Pakistan Economic Corridor Decentralized Autonomous Organization European Commission European Central Bank European Fiscal Board European Union Fiscal Council Global Financial Crisis (2008) Global Initiative for Fiscal Transparency Hungarian Fiscal Council InterAmerican Development Bank International Budget Partnership Independent Fiscal Institution International Journal of Public Administration Legislative Budget Office Long-Term Plan for the China-Pakistan Economic Corridor (2017–2030) Networked Community Governance Non-Governmental Organization Oficina de Asesoría Económico y Financiera de la Asamblea Nacional (Venezuela) Open Budget Index (2015)

Abbreviations xix OBOR OBS OECD OMB PAR PBO RRDC SGP TSCG

One Belt One Road Initiative Open Budget Survey (2015) Organization of Economic Cooperation and Development Office of Management and Budget (US) Public Administration Review Parliamentary Budget Office Resource-Rich Developing Country Stability and Growth Pact (EU) Treaty on Stability, Coordination and Governance in the Economic and Monetary Union (EU)

1

Introduction

A portrait of public value Since its inception in the 1990s at Harvard’s Kennedy School, Mark Moore’s theory of public value has come to have an enormous influence on academics and practitioners in the fields of public administration and public policy (see Moore, 1994, 1995, 2003, 2007; Moore and Donahue, 2012). Its wide dissemination over the past twenty-odd years reflects the power of the theory in raising important questions about the purpose of the public manager in contemporary society (Prebble, 2016; Chohan and Jacobs, 2018). This is why public value has been described as the “next big thing in public management” (Talbot, 2009, p. 167), and lauded as “a comprehensive approach to thinking about public management and about continuous improvement in public services” (Constable et al., 2008, p. 9). In a world driven by greater complexity and diversity and heavily influenced by both neoliberalism and globalization, public value theory has served as an anchor and as a reprieve, both for the public manager and for those who think and theorize about her role and her work. Fundamentally, it argues that the public manager, while working in concert with other actors, including politicians and civil society, acts as an agent in co-creating value for the public (Moore, 1994, 1995, 2003). Moore’s assertion was that public managers should be “orchestrating the processes of public policy development, often in partnership with other actors and stakeholders” (Benington and Moore, 2010, p. 4). In mobilizing public resources and mustering a “value-seeking imagination” (Moore, 1995, p. 22) the public manager serves an important and active role in the betterment of society through efforts to create value across many different domains of engagement. At a deeper level, it is but one of the many lenses academics have used to approach the existential questions surrounding how people “think and feel about society” (Meynhardt, 2009, p. 193), and in public administration, it is a theory that draws upon longstanding debates about the relationships between governments, markets, and society (Roberts, 1995). The original thinking around public value sought “to help imbue public sector managers with a greater appreciation of the constraints and responsibilities within which they work,” (Williams and Shearer, 2011, p. 1367). In Moore’s own words, public value represents “a framework that helps us connect what we

2

Introduction

believe is valuable and requires public resources, with improved ways of understanding what our ‘publics’ value and how we connect to them” (Moore, 1995). Part of Moore’s impetus was in fact to juxtapose public management with private sector performance (O’Flynn and Alford, 2008; Alford and O’Flynn, 2009; Moore, 2007; Prebble, 2016) so as to find metrics that did justice to the contribution of public managers to society (Moore and Donahue, 2012). Indeed, the argument went both ways: the private sector could also learn from the value creation by governments (Moore and Khagram, 2004). It is easy to measure private sector value creation through the bottom-line metric of profit. By contrast, the public sector’s value creation cannot be measured through any “profit” form of bottom line, and in fact part of their value creation might be in undertaking loss-making activities, negative in “profit” terms, for the public good. But public managers do provide some form of good, and public value is in essence a debate around what this value is, how it can be measured, and how it can be enhanced. Public value was constructed as a public service “parallel to a corporate bottom line or a stock price,” but by contrast “described benefits that applied to all of society” (Prebble, 2016, p. 114). Therefore, public value really behooves public managers to ask themselves, “why our work is valuable to society” (Meynhardt, 2009, p. 214). But the profit-seeking parallel is only a first point of departure, for public value would extend beyond “narrow monetary outcomes to include that which benefits and is valued by the citizenry more generally” (Williams and Shearer, 2011, p. 1367; see also Moore and Khagram, 2004). But it does stress the need for a sense of enterprise, initiative, and a “value-seeking imagination” (Moore, 1995, p. 22). As Williams and Shearer remark, public value offers “an affirmation of managerial ingenuity and expertise, albeit within a binding democratic order and a finite resource base,” and so the manager’s purpose “is envisaged as going beyond policy implementation to the more proactive exercising of creativity and entrepreneurialism” (2011, p. 1372). This sense of enterprise is balanced by a need to cooperate and co-create value by mustering “a coalition of sufficient support” (Benington and Turbitt, 2007, p. 383). As such, public value has come to serve as a mainstay in many of the world’s leading schools of government and public administration academies, not least at the Kennedy School at Harvard where it was conceived (Moore, 2003). Anecdotally, I have counted at least fifty major public administration and public policy institutions that include the study of public value as part of their curricula at master’s and doctoral levels. Several important public administration-focused academic journals regularly publish works steeped in public value, including the Public Administration Review (PAR), Australian Journal of Public Administration (AJPA), and International Journal of Public Administration (IJPA). The IJPA and PAR have in fact both produced special issues on public value (see Talbot, 2009; Prebble, 2016). But despite the aforementioned discussion regarding the role of the public manager, there are still pressing questions around the definition(s) of “public value.” As Williams and Shearer note, “there remains some lack of clarity over what public value is, both as a theory and as a descriptor of specific public actions

Introduction

3

and programmes” (2011, p. 1367), and they further observe that “the public value framework does not derive from a particular research tradition and there is, as yet, little by way of empirical research to support the claims made for it” (2011, p. 1381). Indeed, public value is characterized by a multiplicity of hybrid definitions (van der Waal and van Hout, 2009). Prebble has remarked that public value has variously been described as a contribution to storytelling, an analysis of outcomes, a management practice, a tool to make operational improvements, a means of reducing the democratic deficit, a mix of outcomes and outputs, and an aspect of a relationship but not an objective fact (2016, p. 103). Part of this confusion of definitions among the scholarly community, Prebble observes, is because public value was not aimed at scholars but rather at public service practitioners (2016), so that public managers could act as “producers of real material value” (Moore, 2014, p. 465). Benington has argued that public value can be seen in two ways: first, what the public values; and second, what adds value to the public sphere (2009, p. 233). Public value was constructed as a public service “parallel to a corporate bottom line or a stock price,” but by contrast “described benefits that applied to all of society,” (Prebble, 2016, p. 114). In Moore’s own view, it “rejected neoliberal ideas that sought to limit government’s concerns” (Moore, 2014, p. 465). The literature seems to be in consensus about the fact that there is yet no consensus on just what public values are. William and Shearer weigh the positives and negatives of this, suggesting that an advantage may lie in that “public value emerges as an approach that is rooted in everyday practice and retains a non-didactic flexibility of application,” but at the same time “the risk is that public value fails to develop a secure empirical foundation and loses clarity and distinctiveness as an approach to practice” (2011, p. 1374). I attempt to define public value for the purposes of this book as follows: Public value is a discourse regarding the role of public managers in co-creating value through partnerships with other social agents including politicians and civil society, so as to serve a wider public through the deployment of society’s resources: budgetary and non-budgetary; within national boundaries and beyond; in developed and developing countries; in the face of contradictions in values held by citizens; as well as in the face of adversity posed by other agents in society. This definition may appear long-winded, but that is because it seeks to encompass several avenues of enquiry specifically addressed in this book; in a few cases for the first time in the public value literature. The mention of “national boundaries and beyond” speaks to the questions of value creation between nations and of value creation in a supranational entity. The mention of “developing countries” stresses the exploration of contexts beyond the traditional “developed” Western liberal democracies that public value theory has largely been confined to. The “contradictions in values” held by citizens speaks to the process of reconciliation and prioritization which public managers

4

Introduction

must consider when values are held in opposition to one another by the citizenry as the ultimate stakeholder. The “adversity posed by agents” includes the delegitimization, defunding, disbandment, and even tacit and overt violence that citizens, politicians, and private interests can mobilize against public manager institutions. In sum, the definition presented above seeks to assimilate important aspects of this book, and therefore goes beyond various definitions thus far provided by other theorists. The necessity of providing an early definition is made all the more stark when it is remarked that public value theory has come to face criticisms, particularly within academia, for a variety of reasons (Prebble, 2012, 2016; Oakley et al., 2006; Alford and O’Flynn, 2009; Williams and Shearer, 2011). First, this is in part a reflection of public value theory’s persuasive power, which has lent it credence but also brought critical examination of its various facets into close scrutiny (Talbot, 2006). Second, it is also a result of public value’s vagueness and status as an “umbrella concept” that is “still being typologized” (Alford and O’Flynn, 2009, p. 187), which is why it still needs to be “rescued from ambiguity” (Prebble, 2012, p. 392). Third, many important definitions and concepts within public value have been modified over time, but often subtly and without explicit enunciation, even by stalwarts including its founder Moore (see analysis in Prebble, 2015, 2016). As Williams and Shearer remark, “the public value doctrine has been supplemented by newer interpretations and applications and, in the process, commentators (not least Moore himself) have reworked the themes and concepts involved” (2011, p. 1367). An important type of criticism relates to particular aspects of value creation in which the role of the public manager can be called into question. Even those academics who are not necessarily critical of public value theory point to definitional problems and philosophical shortcomings within the theory that require examination and elaboration (Talbot, 2006, 2009; Prebble, 2012, 2016). This book seeks to address both some of those critiques as well as some of those philosophical questions. The problems addressed in this book are enumerated briefly in the Table 1.1. Drawing upon the list in Table 1.1, the first question relates to the power of the public manager to make decisions in a democratic society while discussing the presence of public managers in politics (Chohan and Jacobs, 2017). It suggests that public value theory may be incompatible with democratic systems (Wanna and Rhodes, 2007, p. 415). Another example is that of public value as a “rhetorical” ploy, where critics assert that public value is a sweet-sounding gambit used by public managers to usurp greater power (Oakley et al., 2006; Crabtree, 2004). While these criticisms had been highlighted in the public administration literature (see Alford and O’Flynn, 2009), until recently, solutions to these sorts of criticisms had been left wanting. In fact, it wasn’t until the “lens of budgeting” was deployed (i.e. case studies of public finance institutions), particularly case studies relating to what is known as a Legislative Budget Office (LBO), that these critiques could be provided with a more nuanced treatment (see Chohan and Jacobs, 2017, 2018; Chohan, 2017a, 2017b).

Introduction

5

Table 1.1 Criticisms and questions about public value Type

Problem

Existing criticism

Public value in politics

Existing criticism

Question

Question

Question

Question

Question

Question

Explanation

Public value is anti-democratic because unelected public managers take decisionmaking rights and powers away from elected officials Public value as Public value is a soft-sounding rhetoric rhetorical ploy by public managers to usurp political power Public value What is the role of civil and the citizen? society and citizens in public value creation? The “public” What constitutes the “public” in public value? in public value? By what means do we include/exclude agents of “public” in value creation? Public value in Can public value’s liberal, newly demoWestern orientation be transcratic societies? posed onto post-communist societies? Public value in What happens to public value creation when liberal democ“illiberal” racies become illiberal? democracies? How can the agents of two or Public value more societies co-create public between value? nations? Public value in What happens to the legitithe post-truth macy of the public manager in era? a post-truth world? Can the public manager survive in the post-truth era?

Relevant works Wanna and Rhodes, 2007; Alford and O’Flynn, 2009; Chohan and Jacobs, 2018 Crabtree 2004; Oakley et al., 2006; Chohan and Jacobs, 2017 Benington, 2009

Benington, 2009

Chohan, 2017a

Insufficient mention in the literature Insufficient mention in the literature Insufficient examination in the literature

Source: Chohan and Jacobs, 2017; Alford and O’Flynn, 2009; author research.

However, these are but some of the examples of criticisms that have been lodged against public value theory. Other scholars have noted that public value theory must articulate its solutions to the three goals of “efficiency, accountability and equity” because there is at present a gap in the public value literature due to a “lack of clarity of response” in terms of providing “plausible answers” to those three goals (Stoker, 2006, p. 49). Alford and O’Flynn (2009) were among the first to tabulate the growing number of criticisms about public value theory, but their list was somewhat concise. As Morrell notes, “further clarification, specification and consensus over concepts and terminology” are still necessary (2009).

6

Introduction

Further to this point, there are still unstated assumptions about public value that must be explored in explicit detail. For example, what is the nature of the “public” in public value? There are various definitional questions around this fundamental term within the theory. Similarly, there is a need to examine the relationships between the public manager and the politician vis-à-vis civil society, which would constitute a third pillar of public value’s co-creation ecosystem, but which has yet to be explored (Benington, 2009, p. 241). The topic of civil society receives an independent chapter in this book. Equally importantly, there is a need to consider the universality of public value theory across contexts different from the one in which the theory was conceived. Public value is a product of a specific context: that of liberal (and neo-liberal), Western, pluralist, “advanced” societies. As Benington put it, public value was “developed initially in the United States in the early to mid-1990s, at the height of the dominance of the neo-liberal ideology which privileged models based on individual consumers within a private competitive market over communal citizens within a public democratic state” (2009, p. 232). As Oakley et al. remark, public value “stands as something of a counterblast to the notions ‘of ‘new public management’ (NPM) then gripping centre-right governments (and their centre-left successors) the world over” (2006, p. 2). In Moore’s own view, public value “rejected neoliberal ideas that sought to limit government’s concerns” (Moore, 2014, p. 465). But do its premises and conclusions apply equally to different societies? Could public value theory be applied to post-communist countries? What about “developing” countries? What about those countries now being termed as “illiberal democracies”? These are contexts worth exploring in an investigation of public value’s generalizability. Each of these also receives an independent chapter within this book. Yet it is equally important to consider the nuances around “values” (van der Waal and van Hout, 2009), and therefore in the conflicts within and between societies in terms of how they prioritize values, and therefore how public managers and politicians deal with the values prioritized (for an initial discussion see Chohan and Jacobs, 2018). Yet again, specific chapters are dedicated to addressing value conflicts within societies and between societies. All of these gaps in the public value literature require meticulous analysis if public value is to be advanced within the public administration and public policy literatures – hence this book. As Williams and Shearer observe, “the public value framework does not derive from a particular research tradition and there is, as yet, little by way of empirical research to support the claims made for it” (2011, p. 1381). Some of these concerns have been explicitly recognized, but as Table 1.1 above observes, others are new to the public value discourse and have been met with insufficient attention thus far in the literature – which is to say that they are new explorations within public value theory. To put it in the language of public value, there is a need for “concrete managerial settings” (Meynhardt, 2009, p. 214) where public value can be examined, and they should use compelling case studies to “structure thinking” about what ought to be the case, as well as to “diagnose the existing situation” (2009, p. 174).

Introduction

7

In examining questions about the nature of the “public,” “value,” and “public value,” in a truly international context involving many different countries as case studies, I believe that this book takes an ambitious look at public value with fresh eyes across a wider horizon. It does so by deploying a “budgeting lens” across each chapter’s case study, which is why the next section discusses just what is meant by a “budgeting lens.”

What is a budgeting lens? The budget is a “function of central importance in any polity” (White, 1982, p. 76). There is an important insight to glean from the nature of budgeting that is analogous to the nature of public value. Budgeting is an inherently political enterprise that requires the executive machinery of public managers in order to (ideally) serve the needs of citizens. The analogy here is in the co-creation of public value with the very same agents: public managers (executors, value-seekers), politicians (final arbiters), and civil society (collective customer). This can be expressed diagrammatically as in Figure 1.1. This insight has been tacitly remarked upon in works that have previously deployed the lens of budgeting in public value (see Chohan and Jacobs, 2017, 2018), and it has been framed in terms of observations such as the “natural dialogue” between politicians and public managers in the budgeting exercise of value creation (Chohan and Jacobs, 2018, p. 1063). But it warrants an explicit mention here since it justifies the purpose of writing this book. Politicians are the “final arbiters of public value” in Moore’s words (1995, p. 38), which in the budget process includes a host of functions: legislating budgetary measures (seeking new value-creating opportunities); providing oversight of the budget process (accountability); appropriating funds for the public good (value creation); representing the voices of their constituencies (representing citizen groups); approving budget measures; and debating aspects of the budget (so as to prioritize between values articulated by citizens). In other words, the

Politicians budgetary legislation, oversight, appropriation, representation, debate and approval

Public managers execute budget functions and budgetary programs

Politicians final arbiters of public value

Public managers execute value-creating programs with a value-seeking imagination

THE BUDGET PROCESS

PUBLIC VALUE THEORY

Citizens Receive the outputs of the budget process through resource allocation choices

Citizens articulate their values and represent the colletive customer of value-creation

Figure 1.1 The analogous representations of the budget process and public value theory Source: Author research.

8

Introduction

various functions performed by politicians in the budget process can be understood from the perspective of the public value they create. As arbiters of public value, they respond to values signaled by citizens and then inform, instruct, and cooperate with public managers, by various means, on how those values should be met by apportioning and allocating the resources of society. Public managers serve as the creative “machinery” of the budget process, including executing, planning, forecasting, distributing, assessing, and reporting core budgetary tasks. Various institutions do this explicitly, such as ministries of finance, audit offices, treasuries, legislative budget offices, etc.; but other institutions also do this in indirect ways, so the list of institutions can in fact be much longer. Collectively, these institutions of public managers are the means to realize, to bring into reality, the abstract values that are articulated by citizens and signaled to politicians. But “machinery” should not be taken to imply that public managers are passive automatons. Rather, public managers channel a value-seeking imagination and a sense of enterprise and creativity, as mentioned earlier, to execute value-creating activities at the behest of citizens. So while they are co-creators of value, in the budgeting realm they are also the mechanism of realizing budgetary outcomes. Meanwhile, citizens are the recipients of budgetary outcomes arising through the allocation of society’s resources. When manifested as civil society, the citizenry reflects a collective customer who articulates values to other value-creating agents. Their conflicting values, as articulated to politicians and public managers, lead to prioritization decisions to distribute resources in ways that have differing impacts on groups of citizens (Chohan and Jacobs, 2017). However, citizens are not passive agents either, and are to seize the policy initiative and hold politicians and public managers to account as active co-creators of value. This theorization draws an analogy between public value and budgeting in this introductory chapter because it helps to explain why budgeting is so powerful a lens for analyzing a long series of questions in public value that have yet to be fully addressed. There is a compatibility between both fields, as presented in Figure 1.1, that can diagrammatically be observed between the three agents of public value: public managers, politicians, and civil society. This helps to respond to what Williams and Shearer have found in conducting their review of the literature, the feature that “the relative absence of empirical investigation of either the normative propositions of public value or its efficacy as a framework for understanding public management” (2011, p. 1374).

Tools for budget analysis The field of public finance deals with a great many topics of fiscal interest, so it is important to delineate just what sorts of tools will be applied in this book. To enumerate briefly, the primary tools used in this book will be: legislative budget office case studies, national-level budgetary documentation (budget papers, citizen budgets), and cross-country budget transparency data from the International Budget Partnership’s (IBP) Open Budget Index (OBI). These are presented in Table 1.2.

Introduction

9

Table 1.2 Budgetary tools in this book Tools

Examples

Sources

Legislative budget office case studies

US Congressional Budget Office (CBO), Hungarian Fiscal Council (FC), Venezuelan Oficina de Asesoría Económico y Financiera de la Asamblea Nacional (OAEF), European Fiscal Board (EFB)

National budgetary documents

People’s Guide to the Budget (South Africa), Long Term Plan for China-Pakistan Economic Corridor (Pakistan), European Fiscal Board Documentation (EU) Cross-country fiscal transparency indices from nonpartisan international agencies

Author research, budgetary documents, parliamentary motions and legislation, congressional documents Budgetary documentation, national planning documentation, citizens budgets International Budget Partnership’s Open Budget Index and Open Budget Survey

International budget transparency indices

Source: Author research.

Above all, case studies revolving around an interesting budgeting institution known as a legislative budget office (LBO), alternatively known as an independent fiscal institution (IFI), will serve as the first budgeting tool. For the purposes of definition, LBOs are independent analytical units situated within, but independent of, the legislature, whose primary task is to provide politicians (legislators) with an impartial economic evaluation of matters pertaining to the budget, including forecasts, costings of new policies, evaluations of deficits and debt, and (sometimes) economic advisory and planning work (see discussion in Chohan, 2018b). Such institutions are growing around the world (Kim, 2015; Chohan, 2018a), even though there is still a degree of ambiguity about what role these institutions should play (although public value theory has helped to add some clarity to this debate, see Chohan and Jacobs, 2017). Because they have proliferated in the practitioner sphere but have yet to be more extensively explored in several academic spheres (including public administration and public policy), there is room for creative explorations of how LBOs create public value while navigating both the political and administrative realm (Chohan, 2018a). Why is the LBO particularly à propos in discussions of public value? In previous works (see Chohan and Jacobs, 2017, 2018; Chohan, 2017a, 2017b, 2017c, 2018a, 2018b), I put forward the argument that LBOs are uniquely situated to understanding the public value relationship between politics and administration as they bestride the two. LBOs are designed to enhance public value in the political (legislative) arena because they can be thought of as “a natural dialogue between public managers (economists) and political agents (legislators)” (Chohan and Jacobs, 2018), and their public value contribution is premised on enhancing accountability and oversight by endowing

10

Introduction

legislatures with better budgetary decision-making capabilities through their timely, rigorous, and nonpartisan analytical work. This speaks to Meynhardt’s discussion of “legitimization by numbers” coupled with “a pro-active dialogue about ‘why our work is valuable to society’” (2009, p. 214). LBOs are important in that they cohere to Benington’s definition of public value as “adding value to the public realm by stimulating and supporting democratic dialogue and active public participation and citizen engagement” (2009, p. 237). In this book, the LBOs for which case studies are deployed include those of: the United States, to assess the “re-legitimization” of the public manager in the post-truth era; Hungary and Venezuela, as outcomes for public managers in “illiberal democracies;” and the European Union, to gauge the difficulties in fiscal policy decisions for a “supranational public.” The second category of budgetary tools will be that of national-level documentation, although this belies the fact that a study of the European Union, which is supranational rather than national, will also be conducted as part of examining the broader definition “public” in public value theory. National-level documentation will help to structure thinking about the expectations pertaining to, and functions conferred upon, public managers in the pursuit of public value. Some examples include: the Citizen’s Budget of South Africa (the “People’s Guide”), which will help examine the question of public value and citizen participation; and the Long-Term Plan for the China-Pakistan Economic Corridor, which will help examine public value between nations. The third category of budgetary tools will be that of international budget transparency indices, in particular those produced by the International Budget Partnership (IBP) (see IBP, 2015a, 2015b, 2015c, 2015d), such as the Open Budget Survey (OBS) and the Open Budget Index (OBI). The IBP is the leading compiler of rigorous, nonpartisan, open-access, peer-reviewed information on the level of national budget transparency in 100 nations (IBP, 2015b). It relies on independent assessments, conducted at regular intervals, to compile budget transparency across various themes through 140 specific questions (IBP, 2015c). Each question is accorded a score from 0 to 100, with 100 signifying complete compliance with the metric in question, 67 signifying partial compliance, 33 signifying minimal compliance, and 0 signifying non-compliance (IBP, 2015c). These will be used for cross-country comparisons of budget transparency (and of public value creation) between different groups, as for example in the comparison of postcommunist societies and Western European countries; or in looking at relative budget transparency of countries within the EU; as well as in measuring the state of budget transparency in developing countries (South Africa). It may be noted that a large thematic focus within the assortment of budgetary documentation deployed in this book is on budget transparency and budget accountability. Budget transparency refers to the ease with which important information about the budget is made available to a wider assembly of stakeholders; and so not just to political decision-makers, but also to the public at large (IBP, 2015a, 2015c). Budgetary accountability refers to the ability to make authorities responsible for their fiscal choices and fiscal actions (Chohan, 2017b).

Introduction

11

Why are these thematic aspects of budgeting so important to public value? Because both “transparency” (see Douglas and Meijer, 2016) and “accountability” (Wallis and Gregory, 2009) have been shown to be important conditions for the creation of public value given that, on the one hand, they allow for greater democratic participation and input in the distribution of society’s resources (Stapenhurst and Pelizzo, 2002), and on the other they allow for better (fairer) outcomes to result in society as an output (Wehner and Renzio, 2013). Transparency allows for citizens to more accurately evaluate the programs of public managers and the ambitions of politicians, while accountability allows for citizens to challenge public managers and politicians and hold them responsible for their decisions (Chohan and Jacobs, 2018). Since a budget is a reflection of how resources are allocated within society (see Chohan, 2018a), budgetary transparency and accountability help to align public managers and politicians with those values that citizens most desire. Therefore, as various chapters will demonstrate, the fostering of better budgetary transparency and accountability is vital to creating value for the public in both democratic and not-so-democratic dispensations.

The three-fold aims of this book I recognize that this book is ambitious in its approach because it seeks to achieve three aims systematically: (1) to advance the public value literature across new international contexts, (2) to develop the notion of symbiosis between the lens of budgeting and public value theory, and (3) to identify certain emergent challenges to public value creation. In the first instance, the book seeks to extend public value to new contexts outside those for which it was conceived, namely liberal, Western, “developed” countries (Prebble, 2016; Oakley et al., 2006). Such extensions into new contexts include developing countries (South Africa), post-communist societies (Russia), supranational entities (the European Union), bilateral relations (China-Pakisan), and illiberal democracies (Hungary and Venezuela). In the second instance, the book seeks to develop the notion presented earlier of a symbiosis between public value theory and budgeting. Each chapter addresses this through various budgetary tools, and examples include: a citizen’s budget for civil society; cross-country budget transparency scores for postcommunist vs. non-communist countries; case studies on LBOs in illiberal democracies (which did not survive); long-term economic plans for bilateral stimulus programs; and costings analysis prepared by independent budget offices. Each of these examples will reinforce the claim made in this chapter about a particularly strong relationship between budgetary studies and public value. In the third instance, the book will seek to identify certain emergent challenges to public value creation, which may be a product of a very recent past. Examples include the difficulties faced by public managers in: (1) the post-truth era; (2) the illiberal democracy; and (3) value creation across national boundaries.

12

Introduction

The ambition of the book is international, and it develops case studies on the budgetary institutions in many different country cases across five continents: North America, South America, Europe, Africa, and Asia. This global worldview helps to achieve two objectives. First, it allows for comparisons between highly varied budgeting experiences from around the world, underscoring both the similarities in the challenges faced, as well as the differences in approaches taken by countries in facing adversities. Second, the global approach of this book allows for the examination of public value theory in new and foreign contexts, which represents the aforementioned test for the universality of public value.

The structure of this book In examining international budget experiences with respect to public value theory, it may help to divide the exercise into two parts: (1) to extend public value outwards to new contexts, and (2) to consider challenges in public value creation. The structure of this book is divided accordingly. Part One considers how public value may be extended to new levels of analysis and Part Two then considers difficulties that public managers face, including whether they could be overcome. Although the book is divided into two parts, each of these chapters is a standalone work in its own right. Therefore, practitioners who are interested in a particular budgeting case study, or academics interested in a specific issue within the broader public value discourse, may choose to refer to particular chapters that address their specific interests. Taken together, however, the chapters help to build a construct of connectivity between budgeting and public value theory, and can be read sequentially by readers interested in a fuller picture of the international budgeting experiences as they inform public value. A comprehensive look at public value theory’s frontiers through the lens of budgeting, as conducted in this book, is presented in Table 1.3.

Figure 1.2 Map of countries covered in this book Source: Author research.

Title

Supra-national entities and defining the “public” in public value

Public value in postcommunist societies

3

4

1 Introduction Part One: Extending public 2 Public value, civil society and developing countries

#

Citizens’ Budget of South Africa

Budget lens

Can public value be applied to non-Western liberal democracy contexts, such as post-communism? How has post-communist public value creation fared?

European Union member states

South Africa

Countries

Russia, former International Warsaw Pact Budget Partnercountries ship’s Budget Transparency Scores for post-communist countries and OECD countries

The European What does it mean to be the “public” in a supranational, glo- Fiscal Board balized world? Is the relationship of public managers and politicians in public value creation at the supranational level in conflict with those at the national level?

value to new contexts What is the role of citizens in public value and why is civil society given less attention than public managers and politicians? Is public value applicable to developing countries in the same way as developed countries?

Questions

Table 1.3 Systematically approaching public value questions through a budgetary lens

Citizens are co-creators in public value and their role must be strengthened through better inputs (information) and engagement. Public value creation can be applied to developing countries, and sustained efforts can make value creation here even greater than that in developed countries Supranational identities challenge existing notions of democracy and create a dimension of conflict between value creation by (1) bureaucrats at national vs. supranational levels and (2) politicians and bureaucrats at the national level Public value can indeed be transposed onto post-communist societies but with qualifications due to a different history. Today, post-communist countries are sometimes creating public value in degrees comparable to the traditional Western countries

Analysis/Results

Title

Questions

Public value and the post-truth era

Conclusion

7

8

Source: Author research.

Public value between nations

6

United States Congressional Budget Office (CBO) and American Healthcare Act (AHCA)

The legitimacy of “experts” including bureaucrats is severely undermined in the post-truth era, so are bureaucrats redundant and does this repudiate public value’s basic assumptions of legitimacy?

Hungary, Venezuela

Countries

Long-term Plan for China, Pakistan the China-Pakistan Economic Corridor (2017–2030)

Defunct budget offices of Hungary and Venezuela

Budget lens

How do the agents of two nations (politicians, bureaucrats, civil society) engage in public value creation?

Part Two: Challenges in public value creation 5 Public value and What happens to public value illiberal democracy creation when liberal democracies become “illiberal”

#

Table1.3 (Cont.)

Shutdowns of budget offices show that the illiberal democracy curtails accountability, efficiency, and public value creation Politicians, bureaucrats, and civil society can all articulate “shared” values, and their commitment to create value through a wider negotiation process. A simultaneous negotiation process for the operating environment occurs at the intranational and international levels The post-truth era poses a significant challenge, but does not eliminate the need for expertise. In fact, post-truth dynamics allow for the public manager to reassert her expertise and seize the initiative in public value creation

Analysis/Results

Introduction

15

What should be gleaned from this introductory exposition of Public Value Theory and Budgeting: International Perspectives is that the project is ambitious in tackling multiple aspects of the theory using different tools under the “budgeting” rubric. At the same time, the list of chapters is by no means a total treatment of the possibilities for enquiry that public value offers. If anything, the research presented in this book should be seen as a stairway that future researchers should traverse towards deeper investigations into public value. After all, it has been observed that public value needs to be “rescued from ambiguity” (Prebble, 2012, p. 392), and there is a need for “further clarification, specification and consensus over concepts and terminology” (Morrell, 2009). This book is part of that rescue effort. Public value has come a long way, but it also has a long way to go, as “neither advocates nor detractors are able to substantiate their claims with research” (Williams and Shearer, 2011, p. 1382). So in introducing the scope of this book, I hope readers will be drawn towards yet further enquiry into the public value realm and mobilize an important lens (budgeting) towards advancing the public value discourse forward.

References Alford, J., and O’Flynn, J. (2009). Making sense of public value: Concepts, critiques and emergent meanings. International Journal of Public Administration, 32(3/4), 171–191. Benington, J. (2009). Creating the public in order to create public value? International Journal of Public Administration, 32(3/4), 232–249. Benington, J., and Moore, M. (2010). Public Value: Theory and Practice. Basingstoke, UK: Palgrave MacMillan. Benington, J., and Turbitt, I. (2007). Policing the Drumcree demonstrations in Northern Ireland: Testing leadership theory in practice. Leadership, 3(4), 371–395. Chohan, U. W. (2017a). Public value and bureaucratic rhetoric. In A. Farazmand (ed.), Global Encyclopedia of Public Administration, Public Policy, and Governance: New York: Springer. Chohan, U. W. (2017b). Public value: Bureaucrats vs politicians. In A. Farazmand (ed.), Global Encyclopedia of Public Administration, Public Policy, and Governance. New York: Springer. Chohan, U. W. (2018a). Budget offices. In A. Farazmand (ed.), Global Encyclopedia of Public Administration, Public Policy, and Governance. New York: Springer. Chohan, U. W. (2018b). The roles of independent legislative fiscal institutions: A multidisciplinary approach (doctoral thesis), University of New South Wales (UNSW), Canberra. Chohan, U. W., and Jacobs, K. (2017). Public value in politics: A legislative budget office approach. International Journal of Public Administration, 40(12), 1063–1073. Chohan, U. W., and Jacobs, K. (2018). Public value as rhetoric: A budgeting approach. International Journal of Public Administration, 41(15), 1217–1227. Constable, S., Passmore, E., and Coats, D. (2008). Public value and local accountability in the NHS. Retrieved from Work Foundation, London: www.birmingham.ac.uk/ Documents/college-social-sciences/social-policy/HSMC/ publications /2011/appra ising-publicvalue.pdf Crabtree, J. (2004). The revolution that started in a library. New Statesman, 17(826), 54–56.

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Douglas, S., and Meijer, A. (2016). Transparency and public value: Analyzing the transparency practices and value creation of public utilities. International Journal of Public Administration, 39(12), 940–951. International Budget Partnership (IBP) (2015a). Guide to the Open Budget Questionnaire: An explanation of the questions and response options. Retrieved from Washington, DC: http://internationalbudget.org/wp-content/uploads/ OBS2015-Questionnaire-and-Guidelines-English.pdf International Budget Partnership (IBP) (2015b). OBS Tracker, The Open Budget Survey Tracker [OBS Budget Data]. International Budget Partnership (IBP) (2015c). Open Budget Index. International Budget Partnership (IBP) (2015d). Open Budget Survey (OBS) Methodology [press release]. Kim, C. (2015). A study on compilation and improvement of indices for legislative budgetary institutions: With focus on comparative analysis of current institutions in 60 countries. OECD Journal on Budgeting, 2014(3), 1–30. Meynhardt, T. (2009). Public value inside: What is public value creation? International Journal of Public Administration, 32(3/4), 192–219. Moore, M. (1994). Public value as the focus of strategy. Australian Journal of Public Administration, 53(3), 296–303. Moore, M. (1995). Creating Public Value: Strategic Management in Government. Cambridge, MA: Harvard University Press. Moore, M. (2003). The Public Value Scorecard: A rejoinder and an alternative to ‘Strategic performance measurement and management in non-profit organizations’ by Robert Kaplan. Hauser Center for Non-profit Organizations Working Paper 18. Retrieved from https://papers.ssrn.com/sol3/papers.cfm?abstract_id=402880 Moore, M. (2007). Recognising public value: The challenge of measuring performance in government. In J. Wanna (ed.), A Passion for Policy: Essays in Public Sector Reform. Canberra: Australian National University. Moore, M. (2014). Public value accounting: Establishing the philosophical basis. Public Administration Review, 74(2), 465–477. Moore, M., and Donahue, J. (2012). Ports in a Storm: Public Management in a Turbulent World. Cambridge, MA: Harvard University. Moore, M., and Khagram, S. (2004). On creating public value: What business might learn from government about strategic management. Retrieved from Harvard Kennedy School, Cambridge, MA: www.innovations.harvard.edu/creating-public-va lue-what-business-might-learn-government-about-strategic-management Morrell, K. (2009). Governance and the public good. Public Administration, 87(3), 538– 556. O’Flynn, J., and Alford, J. (2008). Public value: A stocktake of a concept. Paper presented at the Twelfth Annual Conference of the International Research Society for Public Management, Melbourne. Oakley, K., Naylor, R., and Lee, D. (2006). Giving them what they want: Constructing the ‘public’ in public value. BOP Consulting, London. Prebble, M. (2012). Public value and the ideal state: Rescuing public value from ambiguity. Australian Journal of Political Administration, 71(4), 392–402. Prebble, M. (2015). Public value and the limits to collaboration. International Journal of Public Administration, 38(7), 473–485. Prebble, M. (2016). Is “we” singular? The nature of public value. American Review of Public Administration, 48(2), 103–118.

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Roberts, A. (1995). “Civic discovery” as a rhetorical strategy. Journal of Public Policy Analysis and Management, 14(2), 291–307. Stapenhurst, F., and Pelizzo, R. (2002). A bigger role for legislatures. Finance and Development, 39, 46–48. Stoker, G. (2006). Public value management: A new narrative for networked governance? American Review of Public Administration, 36(1), 41–57. Talbot, C. (2006). Paradoxes and prospects of “public value”. Paper presented at the Tenth International Research Symposium on Public Management, Glasgow. Talbot, C. (2009). Public value: The next “big thing” in public management? International Journal of Public Administration, 32(3/4), 167–170. van der Waal, Z., and van Hout, E. T. (2009). Is public value pluralism paramount? The intrinsic multiplicity and hybridity of public values. International Journal of Public Administration Review, 32(3/4), 220–231. Wallis, J., and Gregory, R. (2009). Leadership, accountability and public value: Resolving a problem in “new governance”? International Journal of Public Administration, 32 (3–4), 250–273. Wanna, J., and Rhodes, R. (2007). The limits to public value, or rescuing responsible government from the Platonic gardens. Australian Journal of Public Administration, 66(4), 406–421. Wanna, J., and Rhodes, R. (2007). The limits to public value, or rescuing responsible government from the Platonic guardians. Australian Journal of Public Administration, 66(4), 406–421. Wehner, J., and Renzio, P. d. (2013). Citizens, legislators, and executive disclosure: The political determinants of fiscal transparency. World Development, 41, 96–108. White, S. (1982). The Supreme Soviet and budgetary politics in the USSR. British Journal of Political Science, 12(1), 75–94. Williams, I., and Shearer, H. (2011). Appraising public value: Past, present and futures. Public Administration, 89(4), 1367–1384.

Part I

Extending public value to new contexts

2

Public value, civil society and developing countries

Introduction: value for and from the citizen The aim of this chapter is to draw attention to the role of civil society in public value theory (Benington, 2009, p. 241), particularly in a developing country context, in light of the oft-overlooked role that civil society can play in the cocreation of public value along with public managers and politicians (Moore, 1995). This is done particularly with a view to exploring the applicability of public value theory to the socio-political and institutional milieus of the developing world. For the purposes of definition, as with Benington (2009, p. 241), it is helpful to draw upon Cohen and Arato’s definition of “civil society” as: a sphere of social interaction between economy and state, composed above all of the intimate sphere (especially the family), the sphere of associations (especially voluntary associations), social movements, and forms of public communication. (Cohen and Arato, 1992, p. 9) Despite the fact that civil society lies at the heart of the public sphere and deliberative democracy (Habermas 1962), the theorization of the role of civil society has “largely been neglected” and has lagged behind that of public managers and politicians (Benington, 2009, p. 241), even though civil society is one of three agents central to the theory (see Chohan, 2017b, 2017c). This focus on politicians and public managers belies the importance of civil society in value creation, and it lends credence to Alford and O’Flynn’s observation that public value is still being typologized (2009), despite public value having been lauded as the “next big thing in public management” (Talbot, 2009, p. 167). It is also a gap that stands in marked contrast to the literature on networked community governance (see Benington, 2009; Stoker, 2006) or integrated governance (see Samaratunge and Wijewardena, 2009), which notes that “citizens are no longer viewed as administered, subordinated users and come to be considered as the clients of administration with the ‘right’ to exercise greater influence on the services received and their delivery process” (Samaratunge and Wijewardena, 2009, p. 319).

22

Extending public value to new contexts

Further to this point, Samaratunge and Wijewardena note that “citizens are no longer the passive beings willing to accept everything spelt out to them by their political representatives,” and they include “transparency” as one of the social demands increasingly insisted upon by citizens (2009, p. 316). Transparency is not just crucial to greater citizen participation, but it is a necessary ingredient, or in the words of Douglas and Meijer (2016), a “precondition” for public value creation. As Franklin, Krane, and Ebdon succinctly remark, “citizens look at conditions in their community very differently from the way government officials do” (2013, p. 127). As such, in order for public value theory to advance in a more comprehensive fashion, there is a pressing need to focus on a fuller theorization of civil society’s role in public value. As Franklin, Krane, and Ebdon have elegantly surmised: “budgeting is the linchpin between popular sovereignty and public action. As such, budgeting is the fundamental decision-making process where citizen preferences are translated into governing choices” (2013, p. 123). The lens of budgeting applied in this chapter is known as a citizens budget, which will be explored in considerable detail later, but for the immediate purpose can be defined as an open source of budgetary information presented to the general public in a simplified manner so as to apprise the public of the salient fiscal priorities of governments (see Chohan, 2016a, 2016c). However, as a corollary to the discussion on civil society in public value, this chapter also deliberately constructs a case study in a developing country: South Africa. In doing so, this chapter also approaches the question of public value’s relevance to the developing country contexts which, as various public value scholars have noted, is an under-examined area within the public value discourse (see review in Samaratunge and Wijewardena, 2009). In other words, this chapter simultaneously examines two underexplored facets of public value: (1) the role of civil society in public value creation, and (2) the applicability of the public value discourse to developing country contexts. The ability to achieve these dual objectives will lie in testing for the degree of public value creation, through budget transparency, in a developing country case study. In choosing South Africa, therefore, the test of the aforementioned objectives will lie in measuring the degree of budget transparency that has been achieved in South Africa through tools such as its citizens budget. This will be conducted using cross-country peer-reviewed data from the International Budget Partnership (IBP, 2015b), which has been used by various academics to assess the evolution of national and international budget transparency programs (see for example Wehner and Renzio, 2013; Seifert, Carlitz, and Mondo, 2013; Chohan and Jacobs, 2016). If the level of budget transparency in South Africa is higher than that of “developed” countries, then this will help to substantiate the assertion that active citizen participation in developing countries can help civil society to create significant public value even when politicians and public managers face considerable shortcomings in the value creation exercise. This is attributable to the role that a citizens budget may play in informing civil society about the government’s fiscal priorities, so as to (1) make civil society an active “co-

Public value and civil society

23

creator” of public value, and (2) elicit greater inputs from civil society in a manner that helps to better legitimize existing fiscal institutions. The structure of this chapter is as follows. First, the chapter will examine the gap in the public value literature pertaining to a role for civil society, and then identify the need for a fuller theorization of citizen participation within the process of public value co-creation, with a specific mention of its relevance to developing country contexts. Second, the chapter will provide a fuller definition of what a citizens budget is, and why such a budgetary tool can prove instrumental in soliciting greater civil society inputs in public value creation. Third, the chapter will develop a brief case study on the nature of the citizens budget as found in South Africa, exploring both its developing country context and its civil society role. Fourth, the chapter will measure the level of budgetary transparency achieved in South Africa through its citizens budget, and engage in a cross-country comparison to highlight the public value contribution of civil society in this study. A final section will present concluding remarks and identify future areas of research that emerge from the findings of this chapter.

Revisiting civil society in public value theory Although public value theorists have not accorded to civil society the necessary level of attention, many have alluded to its importance in their writings. It was remarked upon by Williams and Shearer that “models of public sector organization have neglected civil society and positioned the public as either passive recipients of public goods or consumers in a quasi-market” (2011, p. 1374). According to Moore’s original conception of public value (1994, 1995), there were important and mutually reinforcing roles to be played in value creation by public managers, by politicians, and by civil society. These were underpinned by a multidirectional exchange of ideas and views (Beck Jorgensen and Vrangbaek, 2011; van der Waal and van Hout, 2009) and a complex but substantive negotiation process (Moore, 1994, 1995; Moore and Khagram, 2004; Talbot, 2009). In Moore’s original reasoning, civil society was a manifestation of the collective customer (the collective of citizens) within a larger social context (1994). From this, it was argued that public values were whatever citizens valued as a collective customer in a larger society. In Moore’s words, “the primacy in defining public values must be reserved to citizens [in the given context] and their representatives acting through the collective processes of government” (Moore, 1994, p. 304). Moore argued that this would confer legitimacy upon political institutions, because the willingness of “customers and stakeholders” to accept what is offered by entities is what confers on them the “right to operate” in any “authorizing environment” (Moore and Khagram, 2004, p. 8; Moore, 1995, p. 114). But why has the theorization of civil society lagged behind that of politicians and public managers? and why has the public value debate on their role not

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been as rigorous? Benington argues that this is the result of two points: first, that the ideologies of political parties have focused on the dichotomy between state and market; and second, that there was scant overall research into civil society as late as the 1990s (Benington, 2009, p. 241). The comparatively scant examination of the role of civil society in value creation is even more glaring in the context of developing countries, for as Samaratunge and Wijiwardena emphatically remark, “the literature has not done much to explore how the process of public value creation works in developing countries” (2009, p. 313). Yet there is a pressing need for both academic and practitioner inquiry into the needs of developing countries, as “short-lived political advantages, weak regulatory institutions and lack of institutional capabilities are becoming increasingly common in many developing countries” (Samaratunge and Wijiwardena, 2009, p. 313). I would argue that public value’s applicability as a discourse would be severely limited if it could not provide a better understanding of the institutional (particularly public administration-based) dilemmas that beset developing countries. As Benington notes (2009, p. 232) developing countries are beginning to take an increasing interest in public value theory, which is why the theory must be contextualized in their unique circumstances, which are often different in elemental ways from those in which public value was originally conceived (Moore, 1994, 1995; Moore and Khagram, 2004). The need for greater research into developing country public value creation is underpinned by the fact that a large amount of variation exists between developing countries in terms of achieving public sector reforms, not to mention in terms of the shortage of public sector resources, competencies and skills that they face (Samaratunge and Wijewardena, 2009, p. 314). Whereas the public value literature has fallen short in its theorization of citizens and civil society, the literatures on networked community governance (NCG) or on integrated governance have been more proactive in their consideration of civil society as an integrated component within the architecture of effectively governed societies (see literature reviews in Samaratunge and Wijewardena, 2009; Samaratunge and Pillay, 2011). For example, integrated governance argues that civil society is expected to perform two roles. First, civil society engages in the “rule setting” for the market, and second, it engages in applying “persuasive power” both over the market and the state (Samaratunge and Pillay, 2011, p. 313). Citizens can apply this persuasive power because of a shift in their values towards, and expectations of, service delivery (Samaratunge and Wijewardena, 2009, p. 319). Nevertheless, public value theory can and should catch up to the increasing interest of academics in other disciplines regarding civil society. Benington correctly points out that, the “bi-polar contest between state and market” and the dearth of research into civil society thus far notwithstanding, the “powerful influence of civil society upon the state” has been increasingly remarked upon following “popular mass movements for democratization in Eastern Europe, South Africa and Latin America” (2009, p. 241). Ebdon and Franklin echo this

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point in saying that “during the 1990s and into the new millennium, the concern with cynical, distrustful citizens has led governments to focus again on gathering citizen input during budgeting” (2006, p. 439). But is an active civil society role good for public managers? Benington argues that civil society’s growth may serve as a source of “potential tension for governments, in their attempt to increase legitimation by engaging more directly with civil society,” because “more active participation by individual citizens, neighborhood groups, and voluntary associations will result in more vocal challenge to government policies and programmes” (Benington, 2009, p. 241). For budgeting in particular, the literature review by Franklin, Krane and Ebdon (2013) articulates the concern that “professional administrators may resist citizen participation in technical and complex areas such as the budget,” compounded by their belief “that more input increases the difficulty of securing their recommendations” (2013, p. 125). I argue later in this chapter that, if there is a more vocal challenge to government programmes, it is a source of public value creation when seen in the case of budget transparency. It should be seen as a positive force, holding governments to account in its fiscal decisions, and pushing for policies that create value for the public. In fact, I would divide the argument in that the rise of civil society appeals to two aspects of public value theory: (1) the co-creation of value, and (2) the legitimation of political structures. When looking at the co-creation of public value, it should be noted that, even as Benington presents the fear within various governments that a stronger civil society will lead to “loss of control by public policymakers and managers” (2009, p. 241), I argue by contrast that what Benington calls “the policy initiative,” defined as setting “goals and priorities, the generation of policy ideas, and options, the assessment of alternatives, the design of programs, the forms of organization and implementation,” when moving

Figure 2.1 The roles of civil society in public value Source: Author research.

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Extending public value to new contexts

into the hands of citizens, augurs well for public value creation. If anything, citizen budgets ensure that civil society’s role becomes congruent with the original thinking of public value (Moore, 1994, 1995), wherein civil society was posited as a co-creator of public value. Furthermore, a citizens budget could act as a tool for the legitimation of existing political structures, and this is important because “trust and legitimacy” are argued to be “the eventual goal” of public value (Talbot, 2009, p. 168). As Benington has noted, legitimation is now “the bigger challenge for public authorities in more everyday situations” (2009, p. 244). Indeed, the questions of “how to rebuild trust within communities which are disunited, divided and demoralized,” and of “how to develop confidence, trust, and loyalty between the people and the public authorities” are important gaps in the public value literature that may be addressed through citizens budget (Benington, 2009, p. 244). This is because a fuller engagement between civil society and public managers initiates a process of legitimation when citizens find that their inputs are more directly manifested in the policies devised by politicians and carried out by public managers. In order to develop these two claims, that citizens budgets strengthen the role of civil society such that (1) they act as “co-creators” of public value and (2) they help to legitimize existing political structures before the citizenry, a fuller explanation of the nature and purpose of citizens budgets is required.

Why citizens budgets as a lens? This section defines citizens budgets in a manner that they may be deployed as a “budgetary lens” in examining public value theory. In doing so, the section also presents a backdrop of budgetary power asymmetry among the three agents in public value theory, and then explains the role of citizen budgets in mitigating that asymmetry so as to better involve citizens and solicit their inputs. It ties this discussion into the two aforementioned hypothesized benefits of (1) co-creating public value and (2) rebuilding trust in institutions. In revisiting the three agents outlined in public value theory – the public managers, the politicians, and civil society – it is important to note that information about budgets, which is to say information about the prioritization and allocation of society’s resources, is spread asymmetrically (Chohan, 2017a, 2017b, 2017c). Above all, budgeting expertise is concentrated among public managers, who have both the resources and the acumen to synthesize, produce, and deploy budgetary information (Chohan, 2017a). This is most amply manifest in public institutions such as Ministries of Finance and Treasuries, although other institutions too fall into this category of expertise. Politicians too can leverage institutions such as Legislative Budget Offices (see Chohan and Jacobs, 2017a, 2017b; Chohan 2016), to bridge the gap between their fiscal expertise and that of the public managers. However, citizens are generally bereft of such budgetary information, and are mostly inept at navigating documents as large and complex as a national budget (Ebdon and Franklin, 2006; Chohan, 2017b). Among public value theory’s

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three agents, civil society (as a collective of citizens) is by far the least engaged in the budget process (Franklin, Ho, and Ebdon, 2009). After all, the relevance of a comprehensive national budget to their daily lives is also questionable, as only certain line items appear to have impact on their immediate existence, and this makes citizens feel even further removed from the budgetary exercise – and more so in developing countries (Moynihan, 2007). As Ebdon and Franklin remark, “as study after study has suggested, citizen participation in budgetary decision-making is typically minimalist and yields few, if any, directly observable results” (2006). Citizens may also feel a general sense of powerlessness in facing down institutions as large as a ministry of finance, because there is no basis of comparison for their individual resources versus those of public managers and even politicians, and all the more so in developing countries (Franklin, Krane, and Ebdon, 2013). As such, the budget process, even as it exerts an enormous influence over many aspects of a citizen’s life, appears to be an intractable and distant process far removed from a workaday citizen’s lived experience (Chohan, 2016). The consequences of this detachment from the budget process is that the level of public value is diminished, because it does not represent those values and needs that are most urgently articulated by citizens. While politicians are the “final arbiters of public value” (Moore, 1995, p. 38) in the sense that they are meant to act as mediators between the interests of citizens and the resources pooled in a collective society (Chohan and Jacobs, 2017a), the politicians too face complexities and vested interests that diminish their direct connection with the needs of citizens. Corruption, whether in “developed” or developing countries, only magnifies this problem (Moynihan, 2007; Chohan, 2016a; Chohan and Jacobs, 2016; Franklin, Krane, and Ebdon, 2013). With this mind, the following question arises: what solutions can be offered to bridge the asymmetry between civil society and the other two public value agents? One interesting solution has emerged in the form of the citizens budget (see literature review in Ebdon and Franklin, 2006), which is also referred to as a “citizen’s guide to the budget” (Petrie and Shields, 2010, p. 1). A citizens budget is essentially a plain-language document produced by governments to inform citizens about the fiscal priorities and the allocations of budgetary choices by the government in a succinct manner (see Chohan, 2016a).1 Advocates of citizens budgets note that, by reporting and then explaining fiscal decisions and the condition of the public finances a clear manner, the government can “help to demystify the budget beyond the often necessarily technically complex detail in the budget documentation” (Petrie and Shields, 2010, p. 3). That said, Ebdon and Franklin also dismissively state that the “incessant theorizing about the worth of participation continues without acknowledging the gap between theory and practice,” in terms of translating better participation into budgeting outcomes, such that there is an absence of “taking any proactive steps to make participation more beneficial to practitioners or to make theory more robust” (2006, p. 434). This mirrors the

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critique of public value as lacking empirical rigour and its own gap between theory and practice (Williams and Shearer, 2011). A further critical perspective on participatory budgeting emerges from the observation that citizen inputs in budgeting can create or exacerbate tensions about resource allocation that may exist between citizens and politicians or between citizens and public managers (see Franklin, Krane, and Ebdon, 2013); and so it was long ago remarked that “there is a critical difference between going through the empty ritual of participation and having the real power needed to affect the outcome of the process” (Arnstein, 1969, p. 216). To add to this, they also observe a set of shortcomings in practice: “purposes are seldom articulated, expectations vary, and measuring the cost of participation and the suitability of outcomes is difficult” (Franklin, Krane, and Ebdon, 2013; see also Ebdon and Franklin, 2006). Nevertheless, Ebdon and Franklin point to a set of goals and outcomes desired from citizen participation in budget decision-making, including: (1) informing decision making; (2) educating participants on the budget; (3) gaining support for budget proposals; (4) influencing decision-making; and (5) enhancing trust and creating a sense of community (2006; see also Franklin, Ho, and Ebdon, 2009). Two of these resonate with the argument presented earlier for a stronger civil society role in public value creation: (1) to co-create public value is to influence and inform decision-making on budgetary issues; and (2) to enhance trust is to help legitimize existing political institutions. In terms of the trust deficit, Ebdon and Franklin rhetorically pose the following question: “wouldn’t it be better to start the discussions earlier to help citizens understand the realities of the fiscal situation rather than pretend that miracles can happen in government?” (2006, p. 435). In doing so, citizens budgets speak to bridging the trust deficit between citizens and institutions, and legitimize the budget process in the eyes of citizens. This speaks to the importance of “trust and legitimacy” as the eventual goal of public value (Talbot, 2009, p. 168). Furthermore, citizens budgets speak to what Benington identifies as the need for “an alternative form of legitimation for the actions and the interventions of the state given the erosion of confidence in elected representative government” (2009, p. 245). In terms of the co-creation of public value: Benington identifies a requirement of a “well-informed ‘public’ with the consciousness and the capability to engage actively in this kind of democratic dialogue” (2009, p. 232). Furthermore, Ebdon and Franklin’s extensive discussion on communication in budgetary information (2006) leads to an indication that there is a need for greater two-way communication, in this case between civil society on one hand and the public managers and politicians on the other. The two-way nature of communicating normative budgetary goals, as values articulated by citizens and then interpreted and prioritized by politicians and public managers (see discussion in Chohan and Jacobs, 2017b), should be seen as a transmission of messages leading to a process of co-creating public value.

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These challenges are found to be all the more acute in developing countries (see also Moynihan, 2007), where “corruption, elitism, and poor service delivery are frequent, and power may be highly concentrated in the executive branch with little oversight,” which makes citizen participation all the more important because “it fosters good governance, promotes transparency, increases social justice by involving the poor and excluded, and helps individuals become better citizens” (Franklin, Krane, and Ebdon, 2013; see also Moynihan, 2007, p. 58). It can also curb clientelism, patronage, and corruption (Moynihan, 2007). This is why the next section examines the citizens budget of South Africa and then tests for the level of budgetary transparency that this instrument has helped to achieve in that country.

The South African citizens’ budget South Africa has drawn the attention of scholars across numerous disciplines within the social sciences, including public administration, in part because of the sheer complexity of its social system, as characterized by ethnic, class, social, racial, linguistic, and religious divisions (Samaratunge and Pillay, 2011, p. 393). Its transition away from a white supremacist regime towards a multiethnic democracy has been plagued with difficulties but has also set a remarkable example in terms of the accountability, governance, and administrative structures. Samaratunge and Pillay remark on this when noting that South Africa began to foster what was “one of the world’s most elaborate democracies in terms of accountability and decentralized governance,” with the introduction of two broad tools of governance: the Constitution of 1996, and the Batho Pele document (hereafter BPD), which was a white paper on the transformation of the public service (Samaratunge and Pillay, 2011, p. 394). The BPD signaled the South African government’s commitment to eight principles: consultation, service standards, access, courtesy, information, openness and transparency, redress, and value for money (Pillay, 2008). Of these, the two that would influence the creation of a citizens budget would be (1) information and (2) openness and transparency. As Saramaratunge and Pillay note, South African efforts would also include “focusing on external communication – to inform and build awareness among citizens as to their rights and reasonable expectations in service delivery” (2011, p. 394). Yet in the early years of South Africa’s efforts to forge effective governance mechanisms, it was found that there were particular hindrances in fostering transparency and accountability for the purposes of civil society engagement (Samaratunge and Pillay, 2011, p. 395). The challenge, ultimately, was described as one of “managing the relationship between government and civil society” such that a shift is made “from a bureaucratic administration to representative administration” (2011, p. 396). Public value theorists have pointed to the importance of “leadership” and their “value-seeking imagination” as determinants in public value creation (see arguments in Chohan and Jacobs, 2017b, 2017c). This can be observed in the

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South African budget process because the process of incorporating citizen inputs and informing civil society about budgeting was initiated by both public managerial and political leadership. They prioritized the involvement of citizens as part of an effort to channel a value-seeking imagination so as to translate the Constitution and BPD into more tangible value for the public. In particular, it was the first post-apartheid minister of finance, Trevor Manuel (in office 1996–2009), who was instrumental in “adopting the Constitution and [BPD] regarding transparency in the budget process and breaking down secrecy” (Cole et al., 2016). Manuel himself described this as an effort to “decolonize the budget process” such that the budget process would “be owned by the people” (quoted in Cole et al., 2016, p. 42). In his first budget speech, Manuel set a precedent for how the budget would be communicated to the public, popularizing the budget speech with the citizenry through “the use of poetry, imagery, more accessible language, and local African [dialects]” (Cole et al., 2016, p. 42). This speaks both to the participatory budgeting literature, which insists that the manner of communicating budget information to the public helps determine its effectiveness (see Franklin, Ho, and Ebdon, 2009), and to the public value legitimization of institutions through better communication with the public (Moore, 1995; Talbot, 2009; Benington, 2009). Manuel emphasized his point of incorporating citizens by exclaiming the following: For too long, budgets have been made behind closed doors. These are important decisions, which affect all our futures. We are publishing today the same information that is before Government as we finalize the Budget. Every citizen, every stakeholder will be able to read this Statement and see what we are trying to achieve, and the resources we have available. (South African annual budget speech, 1997) To supplement the participatory spirit of the Constitution and the BPD, the government passed the Public Finance Management Act (PFMA) in 1999, which set requirements for new fiscal documentation and highlighted the need for engaging with the public. Equally worth noting, this act was the product of two years of consultations between parliament and the local legislatures and civil society groups. According to the PFMA, the timing of budget documentation was also adjusted to provide a larger window for consultations (see Cole et al., 2016), between the three agents of public value: the parliament (politicians), the Ministry of Finance (public managers), and civil society groups. While some public value analysis has challenged the effectiveness of legislation as mere rhetoric (see example of Australia’s Charter of Budget Honesty in Chohan and Jacobs, 2017b), the PFMA served as a more effective piece of legislation because it was bolstered by commitments from public managers and politicians. The PFMA also set the backdrop for the first South African citizens’ budget, titled the “People’s Guide to the Budget,” to be issued in 2000. In order to broaden its outreach, the “People’s Guide” was published in five South African

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languages, including Zulu and Xhosa. The design of the document was such that it would highlight the priorities of the government, provide a breakdown by expenditure sector (e.g. education, defense), and offer a general picture of the resources available to government. The citizens budget initiative was received positively by civil society groups (Cole et al., 2016) because it helped to make the priorities set out within the PFMA more evident to a general audience. These priorities included: ensuring transparency; increasing budget comprehensiveness; providing political oversight of policy priorities; using information strategically; and changing behavior through better incentives (Cole et al., 2016). South Africa began to produce the “People’s Guide” at regular intervals, and advocated their use in the important transparency fora in which it participated, such as the Collaborative Africa Budget Reform Initiative (CABRI), the Global Initiative for Fiscal Transparency (GIFT), and the Open Government Partnership. As Cole et al. note, the National Treasury has proactively engaged with civil society to support these stakeholders in translating messages from government to society. The goal is to make budget information more accessible, so that it is not just a privilege of middle-class households with Internet access. (2016, p. 51) This chapter considers two recent examples of the citizens budgets that were produced in 2011 and 2016. These two have been selected because of the contrast in their optimism and outlook, while still presenting a comprehensive but succinct picture of the government’s fiscal targets and resources. The 2011 citizens budget emphasized the need for job creation focused on the nation’s youth cohort, and pointed to efforts “over and above our planned investment of R809 billion into building roads, dams, electricity plants, and ports and rail systems,” in addition to expanding “short-term job opportunities by investing a further R70 billion into the Expanded Public Works Programme” (National Treasury of the Republic of South Africa, 2011). It provided a targeted range for job growth (50,000–100,000 over three years), and explicitly solicited proposals for programs from non-governmental organizations (NGOs) and civil society groups. Another section listed other key government priorities such as improving public education through financial aid and subsidies for introducing a National Health Insurance scheme. Yet another section in the citizens budget broke down new proposals for the macroeconomy on both the revenue and expenditure sides, so as to clarify their potential impact on the existing fiscal situation. The 2016 citizens budget emphasized infrastructure spending and partnerships with the private sector. It pointed to a cautious fiscal picture, stating that “it has been number of years since South Africa’s economic growth has been strong enough to encourage employment, promote investment and reduce government’s debt,” and it candidly explained that “in recent months, the

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situation has deteriorated further as expectations for growth have decreased, the rand has depreciated and confidence of business and consumers has fallen” (National Treasury of the Republic of South Africa, 2016). It thereby highlighted the various means for the government to “tighten its belt” and curb “wasteful expenditures,” while drawing upon greater private sector participation to stimulate growth. It also nuanced its spending outlook by stating that social welfare expenditures would be protected, even as the spending ceilings would be lowered (National Treasury of the Republic of South Africa, 2016). While the economic outlook in both years was quite different, with 2016 being markedly more pessimistic, what is important to note is the consistency in presenting information between both documents. Both citizens budgets help demonstrate the candid and direct way in which budgetary information should be concisely presented, even in a difficult fiscal period. This speaks to the strong intent of the public managers to adhere to transparency when engaging with civil society, even in conditions of economic weakness. In this sense, the public managers and politicians involved in preparing and disseminating budgetary information showed an effective commitment (1) to continue to treat civil society as a co-creator of public value, and (2) to work to legitimize their institutional value to the citizenry even in the face of resource constraints and economic hardship. The various “people’s guides” of citizens budgets have been bolstered by the proactive efforts of the public managers at the National Treasury to engage directly with civil society groups. One way has been through a series of workshops involving citizen associations (Cole et al., 2016, p. 51). Two important civil society groups that have keenly responded to the opportunity for budget scrutiny are the Budget and Expenditure Monitoring Forum (BEMF) and the Congress of South African Trade Unions (COSATU). The Treasury has even supported BEMF in producing what has been termed a “citizens’ adjustments budget,” which represents an even higher level of engagement between public managers and civil society. But what have such initiatives to bolster transparency through civil society participation achieved? Cole et al. argue that South Africa has largely met the objectives of the early years: to improve budget information, get a good handle on the numbers, and extend budget coverage in order to make important fiscal and public policy decisions that would redress the inequalities of the past. (2016, p. 51) To test this claim, this chapter now measures the public value contribution of South Africa’s citizens budget through rigorous, peer-reviewed data made public by the International Budget Partnership (2015a, 2015b, 2015c). The IBP is the leading compiler of rigorous, nonpartisan, open-access, peer-reviewed information on the level of national budget transparency in 100 nations (IBP, 2015b). It relies on independent assessments, conducted at regular intervals, to

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compile budget transparency across various themes through 140 specific questions (IBP, 2015c). Each question is accorded a score from 0 to 100, with 100 signifying complete compliance with the metric in question, 67 signifying partial compliance, 33 signifying minimal compliance, and 0 signifying non-compliance (IBP, 2015c). The results of South Africa’s performance are reproduced in Tables 2.1 and 2.2. As the results of IBP’s cross-country data indicate, South Africa is not just a regional leader in achieving budget transparency, but a world leader. It ranks higher than nearly every OECD country, even though these countries are ostensibly the leaders in best practices of budget transparency (Carlitz et al., 2008). For public participation, the IBP notes that South Africa “provides the public with adequate opportunities to engage in the budget process” (IBP, 2015b). The level of public value that its public managers, politicians, and civil society have co-created in the budgeting sphere is not simply outstanding in absolute terms, but on a relative basis it also outshines that of nearly all the “developed” countries sampled. Beyond this, as Table 2.2 shows, South Africa outperforms its neighbours by a wide margin within the Southern African region. Is it that South Africa is better resourced to translate its budgetary instruments into greater value by engaging its citizens than other countries are? Certainly not. The “developed” countries that were sampled score below South Africa in part because they have not mobilized their budgetary architecture towards engaging their citizenry in the ways that South Africa has. This is a credit to the country’s public managers and politicians in channeling a “value-seeking imagination,” as discussed earlier; as well as a commitment to “decolonize the budget” and redress grievances of a troubled legacy of minority oppression (see also Samaratunge and Pillay, 2011; Cole et al., 2016). Table 2.1 International Budget Partnership overall transparency rankings (2015) for the top 10 performing countries Rank

Select countries

Overall transparency ranking / 100 (2015)

1 2 3 4 5 6 7 8 9 10

New Zealand Sweden South Africa Norway United States Brazil France United Kingdom Romania Peru

88 87 86 84 81 77 76 75 75 75

Source: International Budget Partnership (2015a, 2015b).

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Extending public value to new contexts

Table 2.2 IBP rankings for public (citizen) participation in the budget for select countries in the Southern African region (2015) Rank

Select countries

Public participation ranking / 100 (2015)

1 2 3 4 5 6 7

South Africa Zambia Botswana Malawi Zimbabwe Angola Mozambique

65 15 15 15 9 9 7

Source: International Budget Partnership (2015a, 2015b).

Such a process of public value co-creation that actively involves civil society helps to legitimize existing institutions in a developing country that faces numerous governance challenges in a highly heterogenous society with a painful legacy of racial tension. The public managers and politicians closely involved in fostering such a high level of budgetary transparency have thus demonstrated the possibility of substantial value creation by taking the citizenry on-board, and thus overcome the particularly difficult odds of seeking legitimacy in a social setting that would otherwise be prone to disenfranchisement and value destruction. As Benington observes, “civil society is primarily regulated by loyalty—the bonds of association that hold families and informal networks together” (2009, p. 243). In terms of the desired outcomes of citizen participation in budgeting as articulated by Ebdon and Franklin (2006), the South African citizens’ budgets appeared to have achieved all of them: (1) informing decision-making; (2) educating participants on the budget; (3) gaining support for budget proposals; (4) influencing decision-making; and (5) enhancing trust and creating a sense of community. By no means does this imply that the work of public managers, politicians, and civil society in South Africa is complete. As Benington (2009, p. 240) rightly observes, public value is an outcomes-based approach that evaluates meaningfully over the medium to long term. But by overcoming administrative hurdles, resource constraints, political tensions, and other endogenous and exogenous pressures, a developing country such as South Africa has demonstrated that the active engagement of society can produce public value that not just matches but even surpasses that of “developed” countries in the budgetary sphere.

Conclusion: theorizing civil society in public value As Franklin, Krane, and Ebdon have keenly observed: “budgeting is the linchpin between popular sovereignty and public action. As such, budgeting is the fundamental decision-making process where citizen preferences are translated into

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governing choices” (2013, p. 123). The active inclusion of citizens and their collective (civil society) into the budget process is but one example of the relevance of this public value pillar to the overall value creation exercise. Civil society has largely been ignored by public value theorists in the past (Benington, 2009), receiving tangential mention as part of a sharper focus on the public manager. But the deliberate engagement of civil society is crucial to public value creation, as this chapter shows; and the fear that stronger civil society might weaken the position of governments has also been found to be somewhat exaggerated (or not necessarily true) when examining the budget process. The citizen budget literature had articulated concerns about the effectiveness of its tools in realizing better fiscal or social outcomes, but South Africa’s citizen budget (or “People’s Guide”) evidences an important role for communicating budgetary information both concisely and candidly to the public. I had earlier suggested that the theorization of civil society in public value should stress two forces: the co-creation of value and the legitimization of existing institutions. In taking the public into confidence, South Africa’s fiscal public managers have accorded the general public with what Benington calls “the policy initiative” (2009, p. 241), while absorbing important inputs and also justifying their existing priorities (“job creation” in 2011; “infrastructure” in 2016). The public managers have also created a process of legitimizing their work to the general public, and this is important because “trust and legitimacy” are argued to be the eventual goal of public value (Talbot, 2009, p. 168). The citizens budget satisfies various normative criteria articulated by public value theorists, as for example when they insist on a multidirectional exchange of ideas and views (Beck Jorgensen and Vrangbaek, 2011; van der Waal and van Hout, 2009) and a complex but substantive negotiation process (Moore, 1994, 1995; Moore and Khagram, 2004; Talbot, 2009). The citizens budget also helps to affirm the willingness of “customers and stakeholders” to accept what is offered by entities, which in turn confers on them the “right to operate” in an “authorizing environment” (Moore and Khagram, 2004, p. 8; Moore, 1995, p. 114). Aside from this, as Benington observes (2009, p. 232), developing countries are beginning to take an increasing interest in public value theory, which is why the theory must be contextualized in their unique circumstances – which are often different in elemental ways from those in which public value was originally conceived (Moore, 1994, 1995; Moore and Khagram, 2004). This chapter has tested for the universality of public value in looking at the context of a developing country and seeing if the level of public value creation (through budget transparency) could match that of “developed” countries. Indeed, South Africa’s budget transparency score, attributable to high citizen engagement but also to other robust institutions, attests to the fact that developing countries need not just match but can also surpass “developed” countries in public value creation. This is true so long as these countries go the extra mile of proactively engaging public value co-creators (especially civil society) in

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ways that many “developed” countries have neglected to do. The truth, in fact, is that public value creation is a complex process for all societies, developing or otherwise. This lends credence to the hypothesis of this chapter that public value’s discourse can be transposed onto developing countries, since all countries must mobilize public managers, politicians, and civil society towards the co-creation of public value. The chapter delineated various propitious forces that existed in South Africa, such as (1) a proactive, heterogenous civil society, (2) strong public manager leadership, (3) a particular value-seeking imagination influenced by the desire to break from tyrannies of the past, and (4) a positive multidirectional engagement between public managers, politicians, and civil society in the budgetary sphere. However, even though these were made manifest in South Africa, could they not be fostered and channeled in some other country, developing or otherwise? This chapter only begins to theorize the role that civil society can play in public value creation, by acting as a co-creator of value and by legitimizing existing institutions once it is brought in to participate in the value creation process. However, while this helps to advance the public value literature, future research must extend this work meaningfully in several ways. First, public value creation must be tested for in other developing countries, seeking to tease out factors: leadership, a value-seeking imagination, heterogeneity in the “public,” among others; that influence the degree to which public value is achieved. Second, South Africa stands as something of an outlier among the IBP’s budget transparency rankings, since other countries that rank high would be termed “developed”; and while this chapter has sought to explain portions of that success, future research must look at the reasons for other countries’ “failures” in budgetary value creation. Third, this chapter has looked at a positive case where the relationship fostered between public managers, politicians, and citizens was conducive to value creation; but future research should test for negative outcomes; which is to say, incidences in which an antagonistic relationship has persisted between civil society and the other two pillars of public value theory. In looking at incidences of antagonism between civil society and public managers, future enquiry may be better poised to contrast public value success and failure than a mere positive delineation of factors would. Fourth, the budgetary lens is but one mode of enquiry into the role of civil society, albeit a fruitful one. Future research, however, should deploy other lenses found in public administration, such as those relating to institutional culture, administrative practice, legal systems, or sociological influences that may yield richer examples of the role that civil society can play in public value creation. In sum, there is much more work to be done on both the civil society aspect and the developing country aspect of public value’s theorization. However, this chapter has helped to advance the dialogue forward such that future research can refine our understanding of public value in a broader and more universal sense. As the findings of this chapter suggest, since the theory of public value is

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still being typologized, the aforementioned aspects of the theory are likely to prove especially ripe for future enquiry.

Note 1 One important thing to note in discussing citizens budgets is the set of conflicting claims about the degree to which citizens budgets have been studied and can be generalizable. The practitioners claim that the literature is still scant and so the design of citizen budgets in the practitioner sphere remains mired in ambiguity (see Petrie and Shields, 2010). For example, the practitioner claim can be summarized in that “very little has been written to date about what a citizens’ guide to the budget should be: either about what it should contain or what the current country practices are,” and that a “small number of existing publications exhibiting widely divergent approaches” (Petrie and Shields, 2010, p. 4). By contrast, the academics have mustered a body of literature around participatory budgeting to a degree that they have extracted generalizable themes from within that corpus of literature (see examples in Ebdon and Franklin, 2006; Moynihan, 2007; Franklin, Ho, and Ebdon, 2009; Franklin, Krane, and Ebdon, 2013). In reviewing a growing body of literature on citizens budgets and participatory budgeting in the United States, academics make the opposite claim and extract generalizable elements (Ebdon and Franklin, 2006, p. 435). These elements (used as independent variables in the literature) include: (1) the governmental environment, such as the political culture and structure of government; (2) the design of the process, such as its timing of release and the budget allocation types discussed; (3) and the mechanisms used to elicit participation, including the use of public meetings and/or advisory committees.

References Alford, J., and O’Flynn, J. (2009). Making sense of public value: Concepts, critiques and emergent meanings. International Journal of Public Administration, 32(3/4), 171–191. Arnstein, S. R. (1969). A ladder of citizen participation. American Institution of Planners Journal, 35(7), 216–224. Beck Jorgensen, T., and Vrangbaek, K. (2011). Value dynamics: Towards a framework for analyzing public value changes. International Journal of Public Administration, 34(8), 486–496. Benington, J. (2009). Creating the public in order to create public value? International Journal of Public Administration, 32(3/4), 232–249. Bilge, S. (2015). A new approach in public budgeting: Citizens budget. Journal of International Education and Leadership, 5(1), 1–17. Carlitz, R., Renzio, P. d., Krafchik, W., and Ramkumar, V. (2008). Budget transparency around the world. OECD Journal on Budgeting, 9(2), 1–17. Chohan, U. W. (2016a). The citizens budgets of Africa make governments more transparent. The Conversation: Business and Economics, April 26. Retrieved from: http://theconversation.com/the-citizen-budgets-of-africa-make-governments-m ore-transparent-58275 Chohan, U. W. (2016b). The idea of legislative budgeting in Iraq. International Journal of Contemporary Iraqi Studies, 10(1/2), 89–103. Chohan, U. W. (2016c). Who watches the watchmen? Lessons from Uganda’s Budget Office. The Conversation Africa, Business and Economics. June 20. https://theconversa tion.com/who-watches-the-watchmen-lessons-from-ugandas-budget-office-61093

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Chohan, U. W. (2017a). Budget offices. In A. Farazmand (ed.), Global Encyclopedia of Public Administration, Public Policy, and Governance. New York: Springer. Chohan, U. W. (2017b). Independent budget offices and the politics–administration dichotomy. International Journal of Public Administration, 41(12), 1009–1017. Chohan, U. W. (2017c). Public value: Bureaucrats vs politicians. InA. Farazmand (ed.), Global Encyclopedia of Public Administration, Public Policy, and Governance: New York: Springer. Chohan, U. W., and Jacobs, K. (2016). A parliamentary budget office in Fiji: Scope and possibility. Australasian Parliamentary Review, 31(2), 117–129. Chohan, U. W., and Jacobs, K. (2017a). The presidentialisation thesis and parliamentary budget offices. Parliamentary Affairs, 70(2), 361–376. Chohan, U. W., and Jacobs, K. (2017b). Public value in politics: A legislative budget office approach. International Journal of Public Administration, 40(12), 1063–1073. Chohan, U. W., and Jacobs, K. (2018). Public value as rhetoric: A budgeting approach. International Journal of Public Administration, 41(15), 1217–1227. Cohen, J., and Arato, A. (1992). Civil Society and Political Theory. Cambridge, MA: MIT Press. Cole, N., Shah, A., and Linde, G. v. d. (2016). Increasing budget transparency. In A. Alam, R. Mokate, and K. A. Plangemann (eds), Making It Happen: Selected Case Studies in Institutional Reform in South Africa. Washington, DC: World Bank Group. Douglas, S., and Meijer, A. (2016). Transparency and public value: Analyzing the transparency practices and value creation of public utilities. International Journal of Public Administration, 39(12), 940–951. Ebdon, C., and Franklin, A. L. (2006). Citizen participation in budgeting theory. Public Administration Review, 66(3), 437–447. Franklin, A. L., Ho, A. T., and Ebdon, C. (2009). Participatory budgeting in midwestern states: Democratic connection or citizen disconnection. Public Budgeting and Finance, 29(3), 52–73. Franklin, A. L., Krane, D., and Ebdon, C. (2013). Multilevel governance processes – citizens and local budgeting: Comparing Brazil, China, and the United States. International Review of Public Administration, 18(1), 121–144. Habermas, J. (1962, translated into English 1989). The Structural Transformation of the Public Sphere. Cambridge: Polity Press. International Budget Partnership (IBP) (2015a). Guide to the Open Budget questionnaire: An explanation of the questions and response options. Retrieved from Washington, DC: http://internationalbudget.org/wp-content/uploads/OBS2015-Questionnaire-and-Gui delines-English.pdf International Budget Partnership (IBP) (2015b). Open Budget Index. International Budget Partnership (IPB) (2015c). Open Budget Survey (OBS) Methodology [press release]. Meynhardt, T. (2009). Public value inside: What is public value creation? International Journal of Public Administration, 32(3/4), 192–219. Moore, M. (1994). Public value as the focus of strategy. Australian Journal of Public Administration, 53(3), 296–303. Moore, M. (1995). Creating Public Value: Strategic Management in Government. Cambridge, MA: Harvard University Press. Moore, M. (2007). Recognising public value: The challenge of measuring performance in government. In J. Wanna (ed.), A Passion for Policy: Essays in Public Sector Reform. Canberra: Australian National University. Moore, M., and Khagram, S. (2004). On creating public value: What business might learn from government about strategic management. Retrieved from Harvard

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Kennedy School, Cambridge, MA: www.innovations.harvard.edu/creating-public-va lue-what-business-might-learn-government-about-strategic-management Moynihan, D. P. (2007). Citizen participation in budgeting: Prospects for developing countries. InA. Shah (ed.), Participatory Budgeting. Washington, DC: World Bank. National Treasury of the Republic of South Africa. (2011). Budget 2011: A people’s guide. Retrieved from: www.cabri-sbo.org/en/documents/budget-2011-a-peoples-guide. National Treasury of the Republic of South Africa. (2016). Budget 2016: A people’s guide. Retrieved from: www.cabri-sbo.org/en/documents/2016-budget-peoples-guide. Petrie, M., and Shields, J. (2010). Producing a citizen’s guide to the budget. OECD Journal on Budgeting, 10(2), 1–13. Pillay, S. (2008). A cultural ecology of new public management. International Review of Administrative Sciences, 74(3), 373–394. Prebble, M. (2016). Is “we” singular? The nature of public value. American Review of Public Administration, 48(2), 103–118. Samaratunge, R., and Pillay, S. (2011). Governance in developing countries: Sri Lanka and South Africa compared. International Journal of Public Administration, 34(6), 389–398. Samaratunge, R., and Wijewardena, N. (2009). The changing nature of public value in developing countries. International Journal of Public Administration, 32(3/4), 313–327. Seifert, J., Carlitz, R., and Mondo, E. (2013). The Open Budget Index (OBI) as a comparative statistical tool. Journal of Comparative Policy Analysis: Research and Practice, 15(1), 87–101. South African annual budget speech (1997). South African Government. Retrieved from: www.gov.za/national-budget-speech-trevor-manuel-minister-finance-12-ma rch-1997. Spano, A. (2009). Public value creation and management control systems. International Journal of Public Administration, 32(3/4), 328–348. Stoker, G. (2006). Public value management: A new narrative for networked governance? American Review of Public Administration, 36(1), 41–57. Talbot, C. (2009). Public value: The next “big thing” in public management? International Journal of Public Administration, 32(3/4), 167–170. van der Waal, Z., and van Hout, E. T. (2009). Is public value pluralism paramount? The intrinsic multiplicity and hybridity of public values. International Journal of Public Administration Review, 32(3/4), 220–231. Wallis, J., and Gregory, R. (2009). Leadership, accountability and public value: Resolving a problem in “new governance”? International Journal of Public Administration, 32 (3/4), 250–273. Wehner, J., and Renzio, P. de (2013). Citizens, legislators, and executive disclosure: The political determinants of fiscal transparency. World Development, 41, 96–108. Williams, I., and Shearer, H. (2011). Appraising public value: Past, present and futures. Public Administration, 89(4), 1367–1384.

3

Supranational entities and defining the “public” in public value”

Introduction: e pluribus unum? The aim of this chapter is to pose critical questions about the construction of the “public” when it is enlarged to the scale of a supranational entity – such as the European Union (EU) – wherein the “public” is in fact composed of many different national “publics” that may hold conflicting, contradictory, or even antagonistic values (see discussion on “conflicting values” in Chohan and Jacobs, 2017; Chohan, 2017a). It is therefore an effort to extend public value into a context beyond that theorized at present (i.e. to the supranational), and it is thus one of several extensions of public value examined in this book; others include developing countries, illiberal democracies and postcommunist societies. The best observable template of a supranational entity is the EU, which consists of numerous “publics” that are observably different and whose constituent member states do not necessarily share identical values. As such, what is of interest to this chapter is that the construction of a composite “public,” for the purposes of generating public value, ends up creating a new set of challenges that are an order of magnitude greater because of the competing or divergent interests of the national “publics” that are its constituents. Proceeding in a sequential manner, this chapter presents a series of propositions about the difficulties that arise from the creation of a supranational “public.” For the purposes of outlining them briefly, they include: the disparities in incentives for public managers and politicians at the national versus the supranational level; the imbalances between constituent nations within the supranational entity; the surrender of tools to supranational public managers; and the loss of trust in supranational public managers. The chapter will attempt to theorize these propositions as they fit within the context of a supranational “public” and the difficulties faced by supranational public managers, and then to view them through a budgetary lens pertaining to the European Union. The specific institution that is applied as a budgetary lens in examining supranational public value is that of the European Fiscal Board (EFB), which is in essence a form of Independent Fiscal Institution (IFI) comprised of public managers, but created for fiscal policy analysis at the supranational level (see

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studies of IFIs in a public value context in Chohan, 2017a, 2017b, 2018b; Chohan and Jacobs, 2017, 2018). This chapter will use two public value frameworks: the strategic triangle (Moore, 1995), which is the “central symbol” of public value (Alford and O’Flynn, 2009, p. 173); and the advisory-costings framework of public value (Chohan and Jacobs, 2017, 2018), which is particularly à propos to framing the public value contribution of IFIs. These frameworks will be applied towards understanding the success (or lack thereof) for supranational public managers in their value creation efforts, which is of interest to the recent literature because current public value research (e.g. Chohan, 2017a, 2017b) argues that IFIs were strongly associated with public value creation (Chohan, 2018a). In fact, they were framed as a “natural dialogue” between public managers and politicians (Chohan and Jacobs, 2018, p. 1063), when presented as a refutation to Wanna and Rhodes (2007), who expressed concerns about the supremacy of public managers as antithetical to democracy given their usurpation of power from politicians. This chapter critically appraises the claim of whether an IFI really is a “natural dialogue” anymore when seen at the supranational level, and revisits the Wanna and Rhodes’ problem of “public value in politics” but using the same lens that was applied against their argument by Chohan and Jacobs (2018). Why is this question so important to public value theory? Defining the “public” in public value is fundamental to a better understanding and advancement of public value’s theorization because it forces the theorists to ask: for whom exactly is value being created? To this point, at least four public value scholars: Oakley (2006), Benington (2009), Meynhardt (2009), and Prebble (2016), have emphasized this question and underscored the need to examine the ambiguities posed by an inexact interpretation of just who the “public” is. To put it plainly, if we cannot identify the audience (the “they”) for whom value is being created, how can we be certain that we are effectively creating value for “them”? In sequentially presenting a series of propositions about the problems posed by reconstructing a composite “public” out of various national “publics,” it is important to concede a limitation at this early juncture. It should be realized that even a national “public” is composite and pluralist, consisting of various heterogenous social groups and classes that vie to articulate their values and interests; and so the argument of prioritizing between conflicting and contradictory values cannot merely relegated to the supranational composite of “public” (this argument was developed in Chohan and Jacobs, 2017; and Chohan, 2017a). As Benington notes, “the public sphere is heavily contested territory, and there are many competing interests and ideologies in play” (2009, p. 235). However, it is an order of magnitude more difficult to prioritize and address those values at a supranational level than at the national level, as this chapter will discuss. The structure of this chapter is follows. First, it will examine the extant discussion in the public value literature with respect to the difficulties of defining “the public.” Second, the chapter will proceed to situate the supranational “public” of the EU within the challenges recognized in the literature vis-à-vis public managers, politicians, and citizens. Third, it will sequentially highlight a

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series of problems that have arisen in the construction of the EU’s supranational “public” and discuss how public value can contextualize these difficulties. Fourth, it will deploy the budgeting lens of the EFB after explaining what this institution is and what it is purported to do for public value creation. Fifth, it will apply the strategic triangle and the advisory-costings framework to ask whether this IFI really is creating public value, while a final section will present the conclusions.

Defining the “public” in public value Of the two terms that denote the theory, public value theorists have emphasized the “value” aspect in their research far more than the “public” aspect (Benington, 2009; Oakley et al., 2006). This may appear to be an oversight, but it reflects the priorities of the earliest works in public value theory (Moore, 1994, 1995), which sought to rationalize the public manager’s role as still relevant to contemporary society as “producers of real material value,” (Moore, 2014, p. 465; see also Prebble, 2016). The emphasis was therefore put on the value creation and cocreation that the public manager could achieve. For example, the original thinking on public value broached the issues of the “public” tangentially when identifying the third pillar of public value as comprising a “civil society” (see also the previous chapter on civil society value creation), which would act as the “customer” or “stakeholder” that would confer legitimacy upon public managers and give them the “right to operate” in an authorizing environment (Moore and Khagram, 2004, p. 8; Moore, 1995, p. 114). Most subsequent research therefore followed along the same path of focusing on the “value” aspect much more so than on the “public” aspect (see discussions in Talbot, 2006, 2009; Prebble, 2012, 2016; Beck Jorgensen and Vrangbaek, 2011; van der Waal and van Hout, 2009; Chohan, 2017a, 2017b). As such, the question of the “public” was de-emphasized until larger problems within the theorization of public value came to the fore (Alford and O’Flynn, 2009), which forced theorists to take a step back and recalibrate the focus of the public value discourse towards more fundamental questions, in order to have public value “rescued from ambiguity,” (Prebble, 2012, p. 392). To that effect, several theorists came to point out that greater precision was required in defining just what the “public” in public value was supposed to mean (Benington, 2009; Meynhardt, 2009; Oakley et al., 2006, Prebble, 2016). Voices stridently against public value theory began to notice that the ambiguities within it were so stark that the “Humpty Dumpty term” of public value was “both everywhere and nowhere” (Oakley et al., 2006, p. 2; see also Crabtree, 2004), and as a result, it was but “another vague term which seems to be a messy hybrid of [public goods, public interest, and public domain] – without any of their history or intellectual robustness” (Oakley, 2006, p. 3). The originator of public value theory, Mark Moore, only wrote explicitly about considerations of “the public as a whole” (Moore, 2014, p. 472) two decades after presenting his original text on the theory (Moore, 1994). Moore

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expanded on the notion of “arbitration” of value by the “public as a whole,” and not as mere abstraction, Prebble notes (2016, p. 104), but as a real entity with “a capacity not only to think, discuss, and value collectively but also to act collectively” (Moore, 2014, p. 467, emphasis in original). However, the transition from public as an aggregation of individuals to a more organic collective in Moore’s writings (Moore, 2014; Benington and Moore, 2010) was not explicitly theorized, and therefore left more gaps in understanding what should constitute the “public,” which is why Moore’s allusions to the public as collective have been described as “confusing” and “self-contradictory” (see analysis in Prebble, 2016, p. 114). By contrast, Benington’s work (2009) represents perhaps the most direct and robust treatment of the questions regarding the “public” in public value. He has argued that public value “can best be understood and achieved within the notion of the ‘public sphere’” in the Habermasian sense (Habermas, 1962) – that is, a “democratic space which includes, but is not co-terminus with, the state within which citizens address their collective concerns” and “where individual liberties have to be protected” (Benington, 2009, p. 233). Habermasian ideas of the public sphere were influenced by post-war Europe’s efforts to reconstruct society (Habermas, 1962), and the EU itself has been the object of Habermas’s extensive writings in a manner directly influenced by the theorization undertaken during and after the preparation of work on the public sphere. This is a point of particular interest to this chapter because the selection of the EU to discuss the “public” in public value builds upon a concern long articulated in the Eurocentric Habermasian philosophy of the public sphere (Habermas, 1962). From the Habermasian perspective, Benington argues that “the public is not given but made” in that it needs to be “continuously created and constructed” (2009, p. 235), which implies that government must take the initiative in forging the public sphere. As Benington puts it, part of the role of government is to take the lead in shaping and responding to people’s ideas and experiences of the public, of who we are, and what we collectively value […] and what adds to public value and what detracts from it. (2009, p. 253) An active governmental role is thus seen as crucial to the formation of the public, but this raises questions for supranational governments in terms of how they can proactively form a “public”, and how this will contest and conflict with the efforts of national governments to form their own “publics.” To this point, Prebble has expressed reservations about the effectiveness of the “public as a whole,” as a “construct for the arbitration of public value” when compared with the individual (2016, p. 393). This in part because the idea of “the public as a whole” creates a “disembodied singular entity that is different form the sum of its parts,” which understates the “degree of ambiguity

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that is inherent in the pursuit of public value” (2016, p. 392; see also Prebble, 2012, 2015). The notion of “publics” in the plural also goes back to Moore’s writing when he urged managers to use public value as a means of “understanding what our ‘publics’ value” [emphasis added] (1995). This chapter will examine the “public as a whole” even more critically than Prebble did, in the sense that it will look at an agglomeration of publics wherein problems of a “disembodied singular entity” different from the sum of its parts are magnified. This concurs with what Stoker has stated that in public value thinking there should “be a shift from a culture that accepts public acquiescence in decision making to one that expects active citizen endorsement” (2006, p. 47). As such, the literature on the “public” in public value leaves much room for development, partly because the focus of public value research has been on “value” more so than “public,” and partly because the leading voices in public value, the founder Mark Moore included, have left the term largely ambiguous when trying to denote “a public rather than the summation of individual aspirations” (Moore, 2014, p. 469). This chapter therefore advances the “public” aspect of public value considerably by examining the tensions and challenges that emerge when a supranational “public” is created out of national “publics,” which helps to inform the theorization by extrapolating its limitations onto a grander, supranational scale.

The problems of a supranational “public” Using the case of the EU, this section will delineate a series of propositions about the problems that emerge from an agglomeration of national “publics” into a supranational “public,” by situating those problems squarely within the public value discourse. They are summarily listed in the Table 3.1. 1 Incentivization problems In addressing the public value problems of supranational entities, including the construction of a supranational “public,” perhaps the best point of departure is to consider the underlying problems of incentivization that place supranational public managers as fundamentally in opposition to national-level public managers and politicians. For any democratic dispensation, public value assumes that national-level politicians are directly accountable to their democratic electorate, and it also assumes that national-level public managers strive for value creation underpinned by the values that their citizens articulate through various channels at the national level (Benington, 2009; Prebble, 2016; Moore, 2014; Williams and Shearer, 2011). Furthermore, national-level politicians are assumed to be the “final arbiters of value,” (Moore, 1995, p. 38), and will co-create public value with national-level public managers. By contrast, public managers at the national level are not directly accountable to citizens (albeit indirectly so), and supranational public managers (hereafter mostly referred to by their portmanteau as “Eurocrats”) are even more

Table 3.1 The problems of a supranational public Problem

Explanation

Opposing incentives at the national and supranational levels for (1) public managers and (2) politicians

Supranational public managers are not just unbeholden to politicians of any electorate; they also may have goals that directly contradict or oppose those of national-level politicians and public managers.

Imbalances within the supranational entity

The surrender of tools to supranational public managers

Loss of trust in supranational Public managers

Example

The supranational EFB prioritizes fiscal decisions for Europe as a whole, but this can and does oppose what national fiscal councils will argue for as good fiscal policy. National politicians are incentivized towards procyclical fiscal policies (more spending to gain votes), while “Eurocrats” and the EFB want to reduce pro-cyclical policies. Imbalances between member Surplus-generating countries (e. states accentuate the conflicts g. Germany, Netherlands) will about public value creation. accelerate their imbalances when the Euro currency, as a monetary reflection of an aggregate of member states, depreciates due to the weaknesses of deficit-generating countries (e.g. Greece, Italy). But supranational managers do not forge surplus-recycling mechanisms adequately to redress these imbalances. National politicians and public Adopting a common currency and adhering to a supranational managers surrender public central bank prevents member value-creating operational states from using tools such as capabilities to supranational quantitative easing (printing public managers, which money) or devaluing their curweakens them even as they rency. Yet national politicians are still held to account by are still “on the hook” in terms citizens of accountability to citizens. Supranational public managers Dissent from national politicians face a difficulty of legitimiza- in the UK (Brexit), Poland, Hungary, Greece, and Italy tion in the eyes of citizens, (among others) represents the and this loss of trust is seized upon by politicians to varying disenchantment of a large portion of citizens in these coundegrees. tries with the supranational EU system. National governments are now seizing on the unfavourable image of the EU to wrest back operational resources from supranational public managers.

Source: Author research.

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removed from the needs of citizens and even less accountable for their actions (Varoufakis and Holland, 2012; Varoufakis, 2016; Mitchell, 2015; Becker, 2017; Patomäki, 2017). They are not beholden to politicians or democratic representatives of any electorate, nor are they bound to work with public managers at the national level, although they may choose to or need to do so in order to achieve their mandated aims. This leads to the first of several propositions about supranational public managers. Proposition 1: Supranational public managers are not just unbeholden to politicians of any electorate; they may also have goals that directly contradict or oppose those of national-level politicians and public managers. As Figure 3.1 shows, supranational public managers are not beholden to citizens or their national-level political representatives, and may even pursue goals that oppose national-level politicians. In fact, the supranational “Eurocrats” are an order of magnitude removed in that they may sideline the political concerns and exigencies of national politicians and are prone to disregard the possible fallout of their decisions as manifested by the reprisals of voters directed against national politicians. There is an accountability deficit in the institutions of supranational public managers insofar as they are not connected by mechanisms of accountability to politicians or citizens (see political analysis in

Figure 3.1 Do supranational public managers lie outside national public value?

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Varoufakis, 2016; Mitchell, 2015; Patomäki, 2017), and this is detrimental to public value. In economic policy, the supranational institutions can be examined in the European context through examples such as the European Union (EU), the European Commission (EC), the European Central Bank (ECB), and the European Fiscal Board (EFB). All of them are largely incentivized to focus on policies in their aggregate effects on the EU (Mitchell, 2015; Patomäki, 2017; EFB, 2018). However, this can and does oppose the priorities of national economic institutions, including those of both public managers and politicians. This makes it difficult to engage in what Lowndes et al. call the “renewal of citizen consent” (2006, p. 552); and what Benington and Turbitt term the “coalition of sufficient support” that must be forged to generate legitimacy in the eyes of the public (2007, p. 383). A more specific example lies with the European Fiscal Board, a fiscal watchdog and budget office for the EU as a whole, which in its own words aims to serve as “a central fiscal capacity in the euro area towards improving the performance of the participating economies” (EFB, 2018, p. 4). It must prioritize fiscal decisions for Europe in the aggregate, but this can and does oppose what national fiscal councils (national-level public managers) will argue for as fiscal policy. The EFB remarks that when “national fiscal councils [came] into the arena, they increasingly argued that the necessary and independent expertise to draw the right conclusions within the wider margins of flexibility resided with the national fiscal councils” (2018, p. 4). The EFB can sideline the political concerns of national-level politicians, the consequences of which can put national politicians in the crossfire, as through the loss of office. This may result in more bitter tussles between politicians and national public managers on one hand, and supranational public managers on the other, which has “heightened the competition between institutional players over who should set the course” (EFB, 2018, p. 6). Another important example of opposing incentives is in how national politicians in EU member states are incentivized towards pro-cyclical fiscal policies, in the sense of increasing more spending to gain votes (see also Chohan and Jacobs, 2017), while supranational Eurocrats and the EFB want to reduce procyclical policies. They wish to reduce pro-cyclical national-level spending because of the imbalances they fear this will create in Europe at the aggregate level, as when the EFB notes the “need to ensure that the sum of national fiscal policies did not give rise to procyclical policies for the single currency area as a whole” (2018, p. 10). There is thus an inherent mismatch of incentives between national-level public managers and politicians on one side, and supranational public managers on the other. All of them, nonetheless, face troubles in mustering their incentives towards public value creation; for as the EFB notes, “there are no effective incentives to take advantage of good economic times” (EFB, 2018, p. 6). Therefore, the supranational “public” confronts problems in the incentivization of its public managers at the supranational level vis-à-vis at the national level.

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2 Imbalances between national publics The time-tested observation that imbalances and inequalities occur within nations holds true at supranational level as well, but on a larger, more impressive scale. Within the Eurozone there are vast differences of all sorts between member states (Varoufakis and Holland, 2012; Varoufakis, 2016; Mitchell, 2015; Becker, 2017; Patomäki, 2017; Stiglitz et al., 2014). To include such diverse “publics” within a supranational public therefore accentuates the disparities between them, and it leads to difficulties in value creation because of particularly advantageous or disadvantageous conditions that arise therefrom. For example, the base monetary instrument for the Eurozone, the euro currency, is an aggregate representation of many different economies, including the high-output German economy and deficit-ridden countries at the southern and eastern peripheries (Stiglitz et al., 2014; Becker, 2017; Mitchell, 2015). Supranational public managers attempt but struggle to reconcile those natural imbalances. Value creation for a supranational public requires an effort to redress imbalances, but national-level public managers and politicians resist these efforts when they emphasize the values articulated by their own citizens, to whom they are beholden. Public value requires a multidirectional exchange of ideas and views (Beck Jorgensen and Vrangbaek 2011; van der Waal and van Hout, 2009), but this becomes difficult when a supranational dimension is added, and the complex but substantive “negotiation process” that public value necessitates (Moore, 1994, 1995; Moore and Khagram, 2004; Talbot, 2009) becomes more intricate and complex as well. This leads to the second proposition about public value at the supranational level: Proposition 2: Imbalances between member states accentuate the conflicts about public value creation. At the national level, political processes allow representatives of deficit regions, such as rural or de-industrialized areas, to hold office and advocate for the interests (and values) of their constituencies. Public managers reflect the advocacy of politicians by dedicating special machinery to these areas, whether in the form of line-items in the overall budget for fiscal transfers, or in particular ministries serving the interests of such constituencies, among other solutions. National-level politicians and public managers thereby co-create public value by transferring resources from surplus areas (dynamic, large cities) to the deficit areas (rural communities). In Varoufakis’ words, these processes of public value are termed surplus recycling mechanisms (2016). Figure 3.2 shows how surplus recycling mechanisms create public value. Citizens from deficit regions elect national politicians to represent their interests (and values), while national public managers devote machinery and resources to citizen values. Supranational values are not able (or often willing) to recycle surpluses at the supranational level.

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Figure 3.2 Supranational managers and surplus recycling mechanisms

However, supranational entities do not have a commensurate political process for advocating the recycling of economic surpluses (Chohan, 2018d; Varoufakis, 2016). Supranational public manager institutions also do not necessarily engage in specific actions to recycle economic surpluses to deficit areas. Therefore, there are insufficient means to redress imbalances between the members of supranational entities, and the imbalances thus worsen over time. Citizens feel the pinch of this inequality in deficit nations in a variety of ways, but most notably in the services that public managers provide, such as wages, pensions, education, transport, healthcare, and various other public goods. The imbalances also disenfranchise the citizens as workers, as when the EFB notes that “disparities were also observed in the labour market, where historically low unemployment rates in Germany coexisted with high rates in Spain, Italy, France and Portugal” (2018, p. 10). As such, even as imbalances within nations are the norm, there are usually various surplus recycling mechanisms that politicians and public managers deploy to redress those imbalances domestically (Chohan, 2018d). By contrast, recycling surpluses to deficit nations within a supranational entity is far more difficult, at times non-existent (Varoufakis, 2016), and this hinders public value creation supranationally. 3 Surrendering tools to supranational public managers The creation of supranational entities entails the conferral of tools and powers, or “operational capabilities” as they are known in public value’s strategic triangle (see Moore, 1995), from national public managers to supranational ones.

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This occurs without the explicit affirmation of “customers and stakeholders” to accept what is offered by entities, which would have conferred on them the “right to operate” in an “authorizing environment” (see Moore and Khagram, 2004, p. 8; Moore, 1995, p. 114). Oftentimes, the transfer of these powers is a zero-sum shift (Varoufakis, 2016; Mitchell, 2015; Becker, 2017). As such, politicians and public managers at the national level no longer have the same public value operational capabilities, whether to create public value or to prevent public value destruction. This is articulated here as a third proposition: Proposition 3: National politicians and public managers surrender public valuecreating operational capabilities to supranational public managers, which weakens them even as they are still held to account by citizens. This surrender of operational capabilities does not mean that national-level politicians or public managers are “off the hook,” in terms of accountability to citizens. Far from it, they are still beholden to their citizens. In fact, citizens still assume and expect that they will create public value. In other words, national-level politicians and public managers shoulder a great deal of blame for the impositions of supranational institutions (Varoufakis and Holland, 2012; Varoufakis, 2016; Mitchell, 2015; Becker, 2017; Patomäki, 2017; Stiglitz et al., 2014), but do not have the same tools or powers to effectuate public value creation. Figure 3.3 shows how supranational entities transfer public value “operational capabilities” from national public managers to supranational ones. This may include tools, powers, operations, and mandates. A monetary example from the EU illustrates this transfer of operational capabilities. Prior to the creation of the European Union, the central banks of European countries, as independent institutions of public managers, had three important monetary tools available in times of fiscal difficulty or crisis (see also

Figure 3.3 Surrendering operational capabilities to supranational managers

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Mitchell, 2015; Patomäki, 2017): they could devalue their national currencies; they could increase the money supply (print more money); and they could adjust interest rates (the “price” of their money). Following the creation of a supranational European Central Bank (ECB), these powers were transferred from national public managers to a central, supranational monetary authority. National-level public managers in euro member states have thus found themselves far less capable of coping with crises (Mitchell, 2015; Stiglitz et al., 2014), as it is now the supranational public managers’ decision to devalue the euro common currency, set a common interest rate, and print a chosen amount of euros. This has inevitably resulted in considerable tensions among European countries during times of crisis, and as the EFB notes, “in some euro area countries in particular, fiscal adjustment had become a highly contentious political issue which was seen to fuel populist and anti-EU movements” (2017, p. 9). Tensions thus soar between the relatively less powerful national politicians and national public managers on one hand, and supranational public managers on the other. Operational capabilities are one of the three nodes of the strategic triangle (Moore, 1995), and thus crucial to public value creation. The reduction of national-level operational capabilities, while at the same time having persistent citizen expectations of accountability, nudge national politicians by varying degrees towards reasserting their legitimacy and wresting operational capabilities back from supranational managers, a topic discussed more fully in a later chapter in this book on illiberal democracies. 4 Loss of trust Trust and legitimacy are argued to be the eventual goal of public value (Talbot, 2009, p. 168). Yet the aforementioned problems of supranational public managers are ultimately to the detriment of the supranational public manager’s legitimacy, at least in the eyes of citizens within the supranational entity. A sense of distrust can simmer, which citizens may articulate to their national politicians, who can capitalize on the ill will to varying degrees. This can be expressed as a fourth proposition: Proposition 4: Supranational public managers face a difficulty of legitimization in the eyes of citizens, and this loss of trust is seized upon by politicians to varying degrees. As Benington remarks “the public realm is under current challenge from tendencies which undermine the sense of inter-dependence within a multi-cultural society—for example, racism, sexism, fascism, fundamentalism, brutalization and consumerism, which fragment the notion of what we have in common as a public” (2009, p. 235). Public value scholars remark that there is a need to “rebuild public confidence in political institutions, and the most powerful way to do that is to seek active citizen endorsement of the policies and practices of public bodies” (Stoker, 2006, p. 48). These challenges are pressed by politicians seeking to wrest back operational capabilities that have

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been assumed by supranational public managers, by contesting their legitimacy in the eyes of citizens. From a public value perspective, legitimacy is one of the three nodes of the strategic triangle, and is necessary for public managers to engage in value creation and co-creation (Moore and Khagram, 2004; Moore, 1994). Therefore, the aforementioned propositions (1–3) exert a delegitimizing pressure on supranational public managers, which national politicians attempt to seize, and which ultimately damages the ability of supranational managers to create public value. In the European Union, there is a significant backlash against the Eurocrats, and “growing anti-EU, anti-euro sentiments in several Member States” (EFB, 2017, p. 58). As this simmering resentment among citizens grows, and as it is more deftly exploited by politicians (Varoufakis, 2016; Stiglitz et al., 2014), the very existence of a European Union is put into question (Patomäki, 2017), and disintegration becomes a clear possibility (Becker, 2017). One of the most significant such forms of backlash is Brexit, with the United Kingdom explicitly voting to leave the EU after a populist referendum in 2016. However, populist movements, particularly from the far right of the political spectrum, have sprung up in nearly European country, and are even at the centre of government in some countries at the time of this writing. These national-level politicians are seizing upon a political opportunity to wrest control and operational capabilities back from supranational public managers, and they are raising the risk of “illiberal democracies” (see later chapter in this book) as they also de-legitimize public managers at the national level. Critics of public value theory raise a concern in saying that public value’s subjacent tendency may be to pretend “that there are no political tensions that cannot be resolved through sophisticated technocracy” (Oakley et al., 2006, p. 3). Such a technocratic bent among the Eurocrats serves as a straightforward bête noire when the larger process of public value creation does not meet the aspirations of citizens. The technocratic appeal of supranational public managers cannot withstand the moment at which a substantial number of citizens refuse to accord to these managers the three nodes of the public value strategic triangle. Meynhardt has keenly observed that “legitimization by numbers may appear a less complex challenge than facing the challenge of a pro-active dialogue about ‘why our work is valuable to society’” (2009, p. 214). The struggle for supranational public managers therefore becomes one of articulating why their work is valuable to a composite, supranational society. This makes it difficult to engage in what Lowndes et al. call the “renewal of citizen consent” (2006, p. 552); and what Benington and Turbitt term the “coalition of sufficient support” that must be forged to generate legitimacy in the eyes of the public (2007, p. 383).

Testing for supranational public value Following the aforementioned propositions, this section deploys a budgeting case study of the EFB, to test for the degree of public value creation (or destruction) that may occur when nodes of the strategic triangle are not fully in

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place (Moore, 1995). As the EFB is an independent fiscal institution (IFI) at the supranational level, it is also useful to deploy Chohan and Jacobs’ framework on the public value creation of IFIs, which bifurcates their roles into normativeadvisory and mechanistic costings (2018) to determine their public value contribution. The European Fiscal Board is mandated to “offer an independent assessment of the EU’s fiscal framework” (EFB, 2017, p. 3). It is staffed by five members who have strong academic-economist credentials, and their secretariat is located at the European Commission in Brussels. It was founded in 2016 as part of an institutional process within the EU’s public administration to provide assessments on the fiscal mechanisms that the EU employs (EFB, 2017, 2018). Its primary responsibilities include: evaluations of the fiscal stance of the EU as a whole; providing suggestions for the evolution of the EU’s fiscal framework; and providing advice to the president of the European Commission (EFB, 2018). Opinions of the EFB may include recommendations to increase stimulus spending or to tighten fiscal expenditures, as well as analysis of whether countries have complied with fiscal treaties. The EFB is the product of two overarching treaties created and enforced by supranational public managers in the EU: (1) The Fiscal Compact, and (2) The Stability and Growth Pact (SGP). The Fiscal Compact is a binding chapter within the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union (TSCG), which is “an intergovernmental treaty, aiming to reinforce fiscal discipline in the euro area” (EFB, 2017, p. 68). Meanwhile, the SGP is a set of fiscal rules designed to ensure that EU countries “pursue sound public finances and coordinate their fiscal policies” (EFB, 2017, p. 70). The SGP is based on an agreement reached by the EU member states in 1997 to enforce the deficit and debt limits established by the original Maastricht Treaty that forged the EU (see discussion on such fiscal rules in Chohan, 2018b). The EFB was created at a time when the EU was still roiled by “the deepest and most severe financial and economic crisis in Europe’s post-WWII history” (EFB, 2017, p. 3). As discussed in the previous section, the levels of imbalances between the national publics of the EU were growing stark, with some EU member countries thriving economically and gleaming with a robust fiscal outlook, while other countries remained mired in deep fiscal problems that their national-level public managers did not have (or no longer had) the operational capabilities to confront. At the same time, the fiscal framework of the EU was “rules-driven” in the sense that the supranational public managers had imposed hard budgetary constraints (see also Chohan, 2018b), including severe programs of austerity, which were failing to prove effective in resolving the budgetary crises of EU member countries (Mitchell, 2015; Patomäki, 2017). In judging the level of compliance with those rules, a substantial amount of discretion was being applied, which confounded national-level public managers because the application of rules appeared to be arbitrary, deploying “conventional and additional degrees of flexibility,” and driven by what Eurocrats termed “the other relevant factors” (EFB, 2017, p. 4)

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The EFB was also created at a time when populist movements were rising all across Europe and gaining electoral strength, while citizens of the larger European “public” were expressing ever greater disenchantment with the European supranational project (Varoufakis and Holland, 2012; Varoufakis, 2016; Mitchell, 2015; Becker, 2017; Patomäki, 2017; Stiglitz et al., 2014). As the EFB notes, “in some euro area countries in particular, fiscal adjustment had become a highly contentious political issue which was seen to fuel populist and anti-EU movements” (EFB, 2017, p. 9). Meanwhile, national-level IFIs were contesting the authority of the EFB in rendering fiscal assessments and recommendations when they felt it was their mandate to do so (EFB, 2017, 2018). Yet the EFB viewed national-level IFIs as having experience that was “arguably too limited” and a “heterogeneity too large to envisage an encompassing and robust measurement of their individual effectiveness” (EFB, 2017, p. 35). If this is the case, then it is worthwhile examining the role of the EFB as a supranational IFI as well, using the advisorycostings framework of public value developed by Chohan and Jacobs (2017, 2018). This will help to identify what sort of public value creation activities the EFB is engaged in using an IFI-specific rubric. See Table 3.2. Applying the advisory-costings framework demonstrates that the EFB falls considerably short of a full public value creation effort, with an advisory score of 3/6 and costings score of 1.5/3. However, the small size of the office and the supranational nature of its work create limitations both for the IFI and for the framework’s application. For example, the EFB is not a costings institution, and even its forecasting work is limited and dependent on information provided by the EC. Its advisory work is not tailored towards public outreach, but rather in a relationship of “ad-hoc advice to the president of the European Commission” (EFB, 2018). While it does have a mandate to work with national-level IFIs, such collaboration has yet to be fully developed, and the heterogeneity of national IFIs means that its collaborative efforts will be mixed in scope and depth (EFB, 2017). The EFB remarks that when “national fiscal councils [came] into the arena, they increasingly argued that the necessary and independent expertise to draw the right conclusions within the wider margins of flexibility resided with the national fiscal councils” (2018, p. 4). As such, the EFB is an advisory institution whose public value contribution is limited, at least in terms of the prevalent IFI framework. This is why it helps to revert to the original framework of Moore’s strategic triangle (1995), which is the “central symbol” of public value (Alford and O’Flynn, 2009, p. 173). According to the strategic triangle, the EFB enjoys operational capabilities adequate to its advisory work. It also enjoys the establishment’s (EC’s) legitimacy and support. However, it is also under the broader remit of attack against the Eurocrat cadre of supranational public managers. The recognition of its value, while expressed clearly by the EC (EFB, 2017), is met with another large group of doubters including public managers and politicians at the national level. As such, it only partially meets the criteria of the strategic triangle. This is detailed in Table 3.3.

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Table 3.2 Ingredients for an advisory role and a costings role in public value (EFB) (1) Normative – advisory role

European Fiscal Board

Yes: The EFB keenly assess budgeting assumptions, but it does not work to challenge or reframe the budget discourse. It provides independent assessments similar to fiscal commentaries. 2 Providing cover: The IFI allows No: The EFB frames its discussions squarely politicians to disaggregate the merits of in the “Eurocrat jargon,” which does not policy from issues of political loyalty. empower national politicians to distinguish the finer points of supranational budgeting. 3 Providing options: Providing politiYes: The EFB discusses policy options cians with multiple ways to proceed, not along with alternative approaches and their just passively costing what is given to them. constraints. No: The EFB does not foster a “negotia4 Fostering negotiation: Foster a tion process” between national fiscal IFIs, negotiation process between the fiscal rules, and the European [institutions]. Commission. No: The EFB does not have a significant 5 Raising public awareness: Advise public presence or awareness program as the on ex-ante and ex-post oversight that American CBO or Canadian PBO do. increases public awareness of [fiscal problems]. Yes: The EFB lays significant emphasis on 6 Encouraging discipline: Encouragreater fiscal discipline. ging executive budget makers to exercise better analytical discipline. Advisory score: 3/6 (2) Mechanistic – costings role European Fiscal Board No: Most of the number crunching is done 1 Number-crunching: Be the by other instruments of the European “number cruncher in chief” and cost (produce figures for) policies brought to Commission (EC). the IFI. 2 Forecasting: Provide projections of Yes: The EFB provides commentary and budget figures over long-term horizons. analysis on forecasts produced by the EC, and the “appropriate fiscal stance” for the EC. 3 Scorekeeping: Note the changes in No: The EFB does not perform scorekeepbudget figures due to changes in policy ing as this is difficult at a supranational level. measures. Costings score: 1/3 1 Questioning: The IFI questions the budgeting assumptions, challenges the underlying biases, and reframes the budget discourse.

Sources: Chohan and Jacobs (2018); author research.

At this juncture, the aforementioned four propositions can be reapplied to the EFB for fuller context. One is that the supranational EFB analyzes the fiscal stance for the Euroarea as a whole, which may be in opposition to the specific national-level fiscal policies that national IFIs and politicians care about and cater to. In making recommendations of economic stimulus or restraint, the

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Table 3.3 Assessing the European Fiscal Board through Moore’s strategic triangle Criteria

European Fiscal Board

Value

No

Legitimacy and support

Partial

Operational capabilities

Yes

Total

1.5/3.0

 Believers in EFB’s value: - European Commission (EC)  Doubters of its value: - National-level politicians (e.g. populist governments in Italy and Poland) - National-level public managers (certain IFIs)  The EC has extended full legitimacy and support to the EFB, by law, by access to information, by staffing and by personnel. The EFB is situated within the EC secretariat and works largely with EC data.  Outside the EC, the EFB’s legitimacy has not been openly contested, but it falls under the broader attacks against the legitimacy of supranational EC and EU.  The EFB consists of five leading economist-academics, highly knowledgeable in EU policy, law, and economics.  It is provided with ample tools, including EC data, to analyze the fiscal stance of the EU.

Source: Moore (1995); author research.

EFB is incentivized to conceptualize the overall fiscal framework (Proposition 1), which cannot fully capture national concerns. This problem is exacerbated by the growing imbalances between the national publics that comprise the EU (Proposition 2), where continued full employment and output growth in robust economies such as Germany is markedly in contrast with the deficit crises of peripheral eurozone countries (EFB, 2018). While the national IFIs have not surrendered operational capabilities to the EFB, there has been a much larger transfer of national-level public manager and even political capacity to the five major EU institutions: the European Commission, the European Central Bank, the Eurogroup, the Euro Summit and the European Parliament (Proposition 3). Finally, the loss of trust in European supranational institutions, of which the EFB is a small part, is not just lingering but growing with every episode of national fiscal stress that its member states have undergone and continue to undergo (Proposition 4). Current public value research (e.g. Chohan, 2017a, 2018c) argues that IFIs are strongly associated with public value creation. In fact, they were framed as a “natural dialogue” between public managers and politicians (Chohan and Jacobs, 2018, p. 1063), when presented as a refutation to Wanna and Rhodes (2007), who expressed concerns about the supremacy of public managers as antithetical to democracy given their usurpation of power from politicians. However, the EFB challenges these arguments directly, above all because it

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does not serve as a “natural dialogue” between public managers and politicians. In fact, it is an appendage (albeit acting in independence) of the supranational EU architecture and is not immersed in a dialogue with national-level public value stakeholders. Both of the frameworks applied earlier indicate that the EFB’s public value contribution is limited when compared to national-level IFIs (see Chohan, 2018c), and it is important to recognize that this is due to inherent limitations in the EFB’s scope. That said, the claims made by Wanna and Rhodes about the anti-democratic nature of public value in politics (2007), while perhaps refutable at the national-level (Chohan, 2018c), become highly evident at the supranational level. This is an important advance in the discourse on “public value in politics,” because the very same lens (IFIs) which was used to challenge the claim of an anti-democratic public manager bent can, through a supranational perspective on IFIs, be deployed as a counter-claim. The propositions (1–4) presented earlier lend further credence to this point. As such, the difficulties of public managers at the supranational level in creating public value for a larger, composite public represent a lasting challenge to the original claims of public value as a process of co-creating value between various social agents. In fact, there are significant hurdles to these problems, ranging from the transfer of operational capabilities to the fundamental problems of incentivization.

Conclusion: seeking a composite public The development of public value theory thus far has laid a much greater emphasis on “value” than on the “public.” Yet the challenges and contradictions in the public value theory’s development have brought greater attention to the “public” aspect, although much theoretical work is still required on this front. Recent discussions of the “public” in public value have concentrated on several points. First, the public is not given, but continuously made through an organic process that also involves proactive government participation. Second, the construction of a “public as a whole” is a hazy concept that requires refinement. Third, the construction of a larger public presents the problematic image of a disembodied singular entity that is different from its parts. These points are particularly visible in the preceding discussion of this chapter. The supranational public of the EU is indeed a disembodied singular entity that faces several fundamental problems including those of incentivization, imbalances, legitimacy, loss of trust, and shifted operational capabilities. Indeed, the construction of a composite “public” for the purposes of generating public value ends up creating a new set of challenges that are an order of magnitude greater because of the competing or divergent interests of the national “publics” that are its constituents. The EFB is emblematic of these public manager challenges, and two frameworks deployed to examine its public value contribution suggest that its efforts are considerably limited when compared with effective national-level IFIs. Yet the EFB faces various limitations of its own and is therefore but one lens to approach the problem of a supranational

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“public,” which is why this avenue of enquiry is particularly promising for future public administration research that ponders the importance of the “public.” Following the propositions presented in this chapter, what is likely to be of greater research interest going forward is how the larger five EU institutions (the European Commission, the European Central Bank, the Eurogroup, the Euro Summit and the European Parliament) represent those propositions, perhaps even more clearly. In other words, the EFB may be seen as a point of departure, but other EU institutions might be more illustrative of the questions raised in this chapter. The question of constructing a larger “public” is central to public value theory’s advancement, which is why other lenses and case studies must be developed to allow theorization of the “public” to catch up with the advancements in theorizing “values.”

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Public value in post-communist societies

Introduction: The horizon of transitions The aim of this chapter is to consider the suitability of public value theory to the post-communist context. The chapter looks at whether the public value discourse can provide meaningful interpretations of the experience of post-communist institutions, and so it aims to draw out the common elements that concern and underpin both public value theory and the experience of post-communist institutions. It also applies the prism of budgeting to public value (see also discussion in Chohan and Jacobs, 2017) and offers a case study of transparency in the Russian budget process, because transparency has been shown (see Douglas and Meijer, 2016) to be a condition for the creation of public value. Examining budget transparency in post-communist Russia with respect to public value is a line of enquiry that should inform the public administration literature on the effectiveness of societal transitions that are, in Moore’s words, plagued by “imperfect political agreements” (1995, pp. 54–55). In turn, this should serve as an exercise in questioning the universality of public value theory, which has erstwhile been lauded as the “next big thing in public management” (Talbot, 2009, p. 167). This is particularly relevant in the context of what is perhaps the most profound question being asked by those who live in post-communist settings: how do they “think and feel about society?” (Meynhardt, 2009, p. 193). However, before exploring the common elements that bind public value theory and the concerns of post-communist institutions, it is important to visit some unspoken assumptions on which public value theory rests. In particular, there are two assumptions underlying Moore’s original work (1995, 2007; Moore and Donahue, 2012) that do not find equivalencies among institutions in societies of a formerly communist persuasion (Bahry, 1980; Vanagunas 1995, p. 85).

Assumptions underpinning public value First, public value assumes that an independent private sector exists, and that “private consumption decisions remain the final arbiter of private value” (Moore, 1995, p. 38). Part of Moore’s original impetus was in fact to juxtapose public management with private sector performance (O’Flynn and Alford, 2008;

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Alford and O’Flynn, 2009; Moore, 2007; Prebble, 2016), so as to find metrics that did justice to the contribution of public managers to society (Moore and Donahue, 2012). Indeed, the argument went both ways: private sector could also learn from the value creation by governments (Moore and Khagram, 2004). Second, it is assumed that in public value there is an identifiable distinction between public managers and politicians, a notion that is examined more assiduously within the public value discourse under the theme of “public value in politics” (see literature review in Chohan and Jacobs, 2017). The distinction between public managers and politicians is blurred in communist regimes, both because “politicians” are not politicians in the sense used in an electoral and multi-party logic (Echols, 1975; Lowy, 1981; Markova, 2004) and because “public managers” are not public managers in the sense used in the bureaucratic logic of liberal democracies (Hollander, 1967; Hirszowicz, 1980; Vanagunas 1995). Because these assumptions are taken for granted in non-communist contexts, but do not find equivalencies in communist ones, there are innate hurdles in directly transposing the discourse of public value onto post-communist countries in toto. However, the post-1991 transition of former Soviet-bloc (“Warsaw Pact”) countries towards more mixed-economy models and more multiparty political arrangements has meant that there might at least be a minimal basis for evaluating the degree to which such societies can begin to infuse their institutions with the notions subsumed by public value theory.

Post-communist limitations Beyond this, even as O’Flynn and Alford (2008) assert that public value provides the next lens for public sector challenges, there are still several other limitations to this exercise in post-communist milieus. First, the post-communist transition is argued to still be a work-in-progress (Lavigne, 2000), because of continuing changes in the structure, mandate, and design of post-communist public institutions (see for example Markova, 2004; Crotty and Rogers, 2012). Similarly, as Benington (2009, p. 240) rightly observes, public value is an outcomes-based approach that evaluates meaningfully over the long-term. Furthermore, the goals that public value theory seeks to address are themselves works-in-progress, both in a theoretical and practitioner sense. For example Stoker (2006, p. 49) notes that “efficiency, accountability and equity” are three goals for which public value must still articulate its solutions. In a similar vein, whereas communist regimes did make commitments to “efficiency,” “accountability,” and “equity” to varying degrees (Echols, 1975; White, 1982; Diamond, 2003), their actual pursuit of these goals (Echols, 1975; Varga, 2013), and the perceptions of the public towards these goals (Tverdova, 2012), were complicated and highly inconsistent (Bahry, 1980; Markova, 2004). Second, the post-communist experience does not lend itself easily to generalization (Pryor, 1968; Bahry, 1980); nor does the term “public value” (van der Waal and van Hout, 2009). Multiple outcomes have emerged from within the former Soviet-bloc and there are a great many differences in the extent to which those countries have achieved transitions or fostered trust in their

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institutions (see for example Mishler and Rose, 1997, 2001; Markova, 2004). In a similar vein, there are multiple, competing, hybrid definitions of public values (van der Waal and van Hout, 2009). Further to this point, public value is an “umbrella construct” that has not been fully agreed upon or “typologised” as of yet (Alford and O’Flynn, 2009, p. 187); a point not dissimilar to the umbrella construct of “Communism” that subsumed a panoply of political systems within its overarching scope (Meyer, 1967; Echols, 1975). Third, in post-communist countries, there is a dearth of reliable data on and from many of the institutions that would typically be studied with respect to public value (Pryor, 1968; Bahry, 1980; Vanagunas, 1995), and this is particularly true for the institutions in the budget process. With respect to budgeting, communist governments had multiple channels to distribute public funds, and the “budget [was] only one of them’ (Bahry, 1980, p. 271). As a result, as Bahry notes, “budget data taken by themselves represent a partial – and inconsistent – measure of what Moscow allots to different economic programs’ (1980, p. 272). That is why this chapter applies the prism of budget transparency using rigorous, openly available, peer-reviewed data (IBP, 2015a). Nonetheless, while being mindful of these limitations, this chapter begins to address the notion of public value in a post-communist context. It applies the lens of budget transparency in Russia to consider the progress of, as well as the limitations to, public value creation. It also uses the advisory-costings framework for independent budget offices (Chohan and Jacobs, 2017) because of its relevance to the budgeting aspect of this chapter’s enquiry. While there has been a concerted effort among a large group of academics to study post-communist institutions, cultures and societies (see literature review in Markova, 2004), the study of postcommunist public value creation remains extremely limited, (an exception being work on Latvian media, Beitika and Brikse, 2013; Beitika, 2014). This chapter therefore addresses an important gap in the public value literature: the transposition of public value theory onto post-communist societies.

Common threads This chapter poses the argument that several common themes weave through both (1) public value theory and (2) the experience of post-communist institutions, in a way that allows at least a minimum basis for generating compatible perspectives (see Table 4.1). First, both are concerned with a pervasive lack of accountability and trust (Mishler and Rose, 1997, 2001; Markova, 2004). In his seminal work on public value, Moore himself noted that: Political decision-making is vulnerable to many different kinds of corruption… These well-known difficulties can and do affect the moral claims of political decision-making on the conduct of government in the eyes of both citizens and managers. (1995, pp. 54–55)

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Table 4.1 A convergence of public value theory with the experience of post-communist institutions Public value theory Accountability and lack of trust

Accountability is a key element in public value theory (Moore, 1995; Wallis and Gregory, 2009; Spano, 2009).

Citizen participation

There is a need for “active citizen endorsement of the policies and practices of public bodies” (Stoker, 2006). Public value is concerned with “political resistance to change” (Beck Jorgensen and Vrangbaek, 2011).

Resistance to change

Democratic legitimacy

Onus on government

Individuals as determinants

Public value theory is accused of being a “nondemocratic” notion (Wanna and Rhodes, 2007), although scholars have shown that the theory can be pro-democratic (Chohan and Jacobs, 2017). Public value theory “places the initiative for creating value back with government” (Douglas and Meijer, 2016).

Individual forms of arbitration of value, such as through “democratic discourse”, are more robust than arbitrations of public value “by the public as a whole” (Prebble, 2016).

Post-communist institutional experience There is a need for the cultivation of trust between people and institutions, as well as rigorous accountability for decisionmaking in these institutions (Mishler and Rose, 1997; Tverdova, 2012). A greater citizen voice and stronger citizen participation are necessary in building effective institutions (Markova, 2004). Remnants of communist-era vested interests have mustered a powerful resistance to active reform. (Vanagunas, 1995; Fischer, 1999). The democratic legitimacy of these institutions is continually called into question, and antidemocratic elements do push back against democratic reform (Mishler and Rose, 1997; LopezCarlos and Alexashenko, 1998). The challenge today is for government institutions to prove to citizens that they are doing their job; the onus is on them to inform, engage, and convince their stakeholders (Mishler and Rose, 1997; Markova, 2004). Post-communist institutions are trying to break from a legacy of collectivist principles and practices (Mishler and Rose, 2001; Markova, 2004).

Source: Author research.

Whereas Moore described politics as the “final arbiter of public value” (1995, p. 38), a lack of trust in political institutions hampers the ability of citizens to assume ownership of the decision-making process(es). Wallis and Gregory discuss the blame-shifting aspect of the public value debate as characteristic of risk-aversion

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among politicians and public managers (2009), a fact that arises from different dynamics underpinning managerial accountability versus political accountability. Spano (2009, p. 335) suggests that when politicians make poor choices among needs, they can cause public value destruction instead of value creation. Chohan and Jacobs argue that without the support of expertise, many duties for which politicians are at least nominally responsible, such as oversight of the budget process, become extremely difficult and prone to intense partisanship (2017). A second common element is that both public value theory and post-communist institutions are concerned with greater citizen participation; or stated another way: both have a preoccupation with the “need to give more recognition to the legitimacy of a wide range of stakeholders” (Stoker, 2006, p. 47). Public value scholars remark that there is a need to “rebuild public confidence in political institutions, and the most powerful way to do that is to seek active citizen endorsement of the policies and practices of public bodies’ (Stoker, 2006, p. 48). Stoker has stated that in public value thinking there should “be a shift from a culture that accepts public acquiescence in decision making to one that expects active citizen endorsement’ (2006, p. 47). Public value creation requires a multidirectional exchange of information (van der Waal and van Hout, 2009; Benington, 2009), and this includes a dialogue between stakeholders and political decision-makers. In post-communist contexts, Matveeva notes that “civil society is a supplement to political institutions and practices, not a substitute for them” (2008, p. 3). A third common thread is that both public value theory and post-communist institutions are concerned with “political resistance to change” (Beck Jorgensen and Vrangbaek, 2011, p. 494, emphasis added). The post-communist transition has been described as a modernization that is incomplete, and replete with unfinished or half-achieved aims (see various discussions within Markova, 2004; Lavigne, 2000). It is observed that the transition away from Communism appeared to be radical in its early years, but that this masked a strong underlying resistance to change, and that the remnants of pro-communist structures are much more than vestiges (Mishler and Rose, 1997, 2001; Markova, 2004; Tverdova, 2012). The resistance can often be aggressive, even violent. A parallel is found in the resistance to change that public managers face from politicians who, as Wanna and Rhodes say, can “get nasty, bite them back, leave them exposed” (2007, p. 414). A fourth common thread is that both have their democratic legitimacy challenged, and both are actively averse to accusations of being “non-democratic.” Public value has been criticized for possessing a non-democratic streak (Wanna and Rhodes, 2007), under the argument that public value leads public managers to “usurp” the role of politicians in making choices. However, as Alford and O’Flynn (2009) point out, this is a misreading of Moore’s work. Furthermore, Chohan and Jacobs use the lens of budgeting to show that public value creation can be a pro-democratic force (2017). Yet the accusation persists that public value possesses some sort of non-democratic element. The same is true for the institutions of post-communist countries in the meaningful sense that, even as post-communist societies have militated for more democratic

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arrangements (Matveeva, 2008), they are frustrated by anti-democratic elements, and thus the accusation is (not always wrongly) hurled that a nondemocratic streak persists (Mishler and Rose, 1997; Markova, 2004; Tverdova, 2012). A fifth common thread is that, in both public value theory and the experience of post-communist institutions, the onus is on government to prove itself in terms of its contribution to citizens’ lives. Public value theory “places the initiative for creating value back with government,” and “this turns the organization from a passive subject into an active party in value creation’ (Douglas and Meijer, 2016, p. 941). Unlike the logic of communist-era institutions, today’s post-communist institutions are expected to prove to citizens that they are doing their job. The onus is on them to inform, engage, and convince their stakeholders. The institutions themselves have to demonstrate how they are contributing to the lives of citizens, and wherever they do not do so, they are vulnerable to both passive and active resistance by citizen bodies (Mishler and Rose, 1997; Markova, 2004). A sixth common thread is that, in both public value theory and the experience of post-communist institutions, there is a strong tension between the collective and the individual as the base unit of social construction. Under communism, the social artery formed the basis for relations between people, and society was structured under collectivist principles (Meyer, 1967; Echols, 1975; Markova, 2004). In public value theory, the tension lies between individuals and societies (“the public as a whole”) in terms of who is to be the “arbiter of value” (Prebble, 2016). Prebble asserts that the individual forms of arbitration of value, such as through “democratic discourse,” are more robust than arbitrations of public value “by the public as a whole” (2016). Therefore, public value theory and post-communist institutions both appear to veer towards individuals as determinants of social decision-making. The aforementioned common threads between public value theory and the experience of post-communist institutions are summarized in Table 4.1. What these common threads show is that there is at least a minimal basis, between the conceptualization of public value theory and the experience of post-communist institutions in praxis, for scholars to examine the challenges that both encounter.

Budget transparency in a post-communist context The budget is a “function of central importance in any polity” (White, 1982, p. 76), and this chapter uses the lens of budget transparency in Russia to describe how public value is being created as post-communist institutions in the Russian budget process work towards making budgeting more accountable, transparent, and participatory. For the purposes of this chapter, “transparency” can be defined as the level and amount of relevant budget information provided by organizations so that external evaluations of the effectiveness of the budget process can be conducted; and this definition is in line with other previous typologies (see Grimmelikhuijsen and Meijer, 2014). Transparency is an

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important element in this enquiry because, as recent work shows, transparency is a significant contributor to, and precondition for, public value creation (Douglas and Meijer, 2016). The chapter proceeds with a case study, using the International Budget Partnership’s (IBP, 2015b) peer-reviewed data on transparency to do so. A budget process is formed through the interaction of several institutions, including the executive branch and the legislature, that require political inputs (Wildavsky, 1964; von Hagen and Harden, 1995; Stapenhurst and Pelizzo, 2002; Chohan, 2013b). There are also institutions that are meant to exercise impartiality or take a neutral stance between the legislature and the executive, such as the Auditor-General and the Legislative Budget Office (Chohan, 2013b). There is often a tension between these institutions that arises from their desire to have greater input into the budget process (Wildavsky 1964; White, 2009). In every country, the relative influence and relative endowments of these institutions differs (Diamond, 2003; Chohan, 2013b; Chohan and Jacobs, 2017). Yet these institutions must interact and share information, much as public value creation requires a multidirectional exchange of information (van der Waal and van Hout, 2009; Spano, 2009; Benington, 2009). This point resonates with Mark Moore’s assertion that public managers should be “orchestrating the processes of public policy development, often in partnership with other actors and stakeholders’ (Benington and Moore, 2010, p. 4). During the Soviet-era, the budget process was characterized by a lack of transparency (Echols, 1975; Bahry, 1980; White, 1982; Vanagunas, 1995). This is articulated by White (1982, p. 87) in that scholars have had “only limited and somewhat unsatisfactory information about the issues that Soviet constituents [brought] to attention [in budgeting].” A more critical description by Vanagunas (1995, p. 86) is that “there was a large element of ritualistic sham in the budget process.” Furthermore, citizen participation in the budget process was wanting and ineffective, and White (1982, p. 87) notes that it is impossible to specify more precisely the manner in which Soviet citizens [brought] concerns to the attention of their deputies and the extent to which deputies in turn [were] influenced by such considerations in making their annual decisions on budgetary allocations. The manner in which interests and institutions “bid” for money during this period was not transparently disclosed either (Vanagunas, 1995, p. 85). This is noted by White (1982, p. 92): [It was a] largely opaque process by which enterprises, areas and institutions ‘bid’ for a favorable plan and budgetary place, a process which must clearly [have exercised] a considerable influence upon the proposals that the Soviet government [presented] to the Supreme Soviet for its consideration but which [did] not, as a rule, take place in a sufficiently open manner to permit its systematic investigation.

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In essence, communist-era budget priorities, such as fiscal harmony between soviet nationalities (White, 1982), “compliance with government controlled expenditures plans” (Diamond, 2003, p. 9), or the division between state funding and collectivized institutions for expenditures (Bahry, 1980, p. 273); all were different from those one would find in post-communist (market-oriented) budget processes; and further to this point is the fact that budgets themselves were “inconsistent and ambiguous measures” of communist priorities (Bahry, 1980, p. 267). The budget issues faced during the transition from communist to post-communist systems were not specific to Russia but were found to be similar across other countries of the former Soviet-Bloc as well (see for example Vanagunas, 1995; Diamond, 2003). There were also divergences inside of communist countries themselves (see Bulgarian example in Welsh, 1977, p. 200). The transition to a more mixed-economic model in post-communist societies depended on “more than liberalizing economic policies, but also on building the institutional capacity for implementing these policies’ (Diamond, 2003, p. 9). Because former institutional structures have exerted a heavy influence on post-communist transitions, the ability of societies to change that structure has determined the effectiveness of socioeconomic transitions (Diamond, 2003, 2005). Vanagunas voices the concern about the transition, from a budgeting perspective, in the following manner: insofar as the states emerging from the former USSR seek to be marketbased democracies, that is, political economies characterized by decentralization of political and economic decision making, the legacy of the many decades of Soviet budgeting policies and practices is, at best, not useful and, at worst, promotes fiscal dysfunction and inhibits reform. (1995, pp. 86–87) Scholars have identified, in the words of Vanagunas, several “odious” vestiges of communist-era budgeting (1995, p. 88). One is the high level of tax evasion, as Soviet societies in practice were not able to foster a “tax payer culture” (Vanagunas, 1995, p.90), and this was in part due to a system of revenue sourcing predicated on “hidden taxes,” as well as on excess complexity in tax regulations. The excess complexity has been an integral factor in the low civic participation in the budget process, which leaves taxation and budgeting “incomprehendable [sic] not only to ordinary taxpayers but also to enterprise accountants” (Vanagunas, 1995, p. 90). Furthermore, although post-Soviet budget institutions were left with a strong base of staff with “number crunching skills,” these experts did not develop the budgeting skills which require “judgmental latitude” such as independent forecasting, estimating, and predicting (Vanagunas, 1995, p. 89). In Russia, and other former Soviet countries, fiscal and budget policies during the initial transition period were in many ways directed towards supporting the old institutional structures (such as the state-owned enterprises) instead of reinforcing

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the transition; a problem made worse by strong vested interests from the communist era (Fischer, 1999; Lopez-Carlos and Alexashenko, 1998, Hernandez-Cata 1995). Furthermore, given the crisis situation and the immense disruptions taking place at the time, budgetary authorities found themselves placing far more emphasis on short-term solutions (Diamond, 2003; Fischer, 1999; Solnick 1996). Political sensitivities also prevented certain areas of the budget from being touched, but this meant even more drastic cuts in other areas such as “operational” and “maintenance” spending items; an issue that was worsened by the very short notice at which the cuts were announced by the central government, and those too without consultation from the relevant spending ministries (Diamond, 2003; Lopez-Carlos and Alexashenko, 1998; Hernandez-Cata 1995). In Russia, some portions of the budget process “required radical restructuring” (Diamond, 2003, p. 9), while in other areas, entirely new functions had to be created, but this uncoordinated approach led to a lack of clarity in terms of both budget responsibilities and budget procedures. As mentioned at the beginning of this chapter, it is taken for granted in public value theory that there is a distinct private sector, separate from and contrastable with the public sector. In Russia during the transition phase there was much greater comingling of the private and public economic spheres. On the one hand, private companies engaged in service provisions that would in market economies normally fall into the public sphere, such as the provision of infrastructure and the maintenance of schools. On the other hand, public institutions carried out functions that would normally fall into the private sphere, as when Diamond states that “some large ministries were often no more than holding companies for enterprises, and large ministries, like defense, had numerous enterprises in their portfolio” (2003, p. 12). Beyond this, the transition also started the process of the devolution of power in two directions (Diamond, 2003): first, from the central government to local government; and second, from the executive branch to the legislature (Diamond, 2005; Kraan et al., 2008). In 2001, the Russian budget process began to move from a crisis-mitigation stage towards a more stable macroeconomic trajectory, and it promulgated the Russian Budget Code as a standardizing law. However, this document too was not absolved of the soviet legacy (Diamond, 2005). This was followed by a series of reforms that sought to streamline the budget process, make it less complex, and tailor it to be more efficient and transparent (Kraan et al., 2008; IBP, 2015b, 2015c). The emphasis in these reforms lay in a strong audit role, which is to say in bolstering the capacity of audit institutions. Russia’s economy had stabilized by the 2000s, and was in fact propelled by strong oil revenues. While the legacy of Soviet-era institutions lingered, enough time had lapsed, and enough reform had been undertaken (sometimes drastically so), for the Russian budget process to look largely unrecognizable from that of the former Soviet Union. But how unrecognizable? This chapter looks at the extent to which Russia has achieved transparency in the budget process in the past decade, using independent and rigorously gathered data from the International Budget Partnership (IBP) to see just how far Russia has come. It then

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concludes by tying this into the common threads identified between public value theory and post-communist institutions (see Table 4.1).

Evaluating budget transparency The IBP is the leading compiler of rigorous, nonpartisan, and peer-reviewed data on the level of national budget transparency in 100 nations (IBP, 2015b). It relies on independent assessments, conducted at regular intervals, to compile budget transparency across general themes through 140 specific questions (IBP, 2015c). Each question is accorded a score from 0 to 100, with 100 signifying complete compliance with the metric in question, 67 signifying partial compliance, 33 signifying minimal compliance, and 0 signifying non-compliance (IBP, 2015c). This level of comprehensiveness explains why the IBP’s data has been used by various academics to assess the evolution of national and crosscountry budget transparency (see for example Wehner and Renzio, 2013; Chohan and Jacobs, 2017). This resource was also employed in a previous chapter on South Africa and its citizens budgets. This chapter indicates data from select countries (see Table 4.2) to comparatively analyze the degree of budget transparency across three groups. The first group comprises former Soviet-bloc countries including Russia. The second group comprises former Soviet-bloc countries that are now European Union members. This distinction is important because these EU members are subject to the standards of budgeting as promulgated by common EU legislation, which exacts a high standard of fiscal disclosure from member countries (Cini, 2008, p. 743). The third group comprises select OECD countries – the UK, the US, France, and Germany. This third group is included not simply to “set the bar,” but because public value theory has a well-established presence in the context of these countries. If budget transparency standards in countries such as Russia were comparable to those in these OECD countries with a tradition of public value discourse, it could be inferred that public value theory itself can be at least partially transposed onto these countries. Looking at Russia’s level of budget transparency allows analysts to glean interesting information about the current state of transparency and accountability internationally (see Table 4.2). Russia stands out among former USSR countries as further ahead in fostering budget transparency. Its score of 74/100 is considerably higher than many of its former USSR peers who tend to have scores closer to 50/100. More interestingly, it is also ahead of many former communist countries that are now EU members, such as Hungary, Poland, Czech Republic, and Slovakia. This is somewhat surprising given the ostensibly exacting standards that the EU puts on member countries for “fiscal discipline,” “governance,” and “transparency” (Cini, 2008, p. 743). Russia is not beholden to such standards, and yet its score surpasses that of former communist countries which are now European Union members (see also an earlier chapter on supranational public value in the EU).

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Table 4.2 IBP’s Open Budget Index: summary statistics for select countries (2015) Overall transparency

Participation

Oversight legislature

FORMER USSR GROUP Russia 74 25 79 Georgia 66 46 73 Kyrgyz Republic 54 52 70 Mongolia 51 19 70 Kazakhstan 51 27 70 Azerbaijan 51 19 37 Tajikistan 25 19 70 EU-MEMBER FORMER-COMMUNIST COUNTRIES Czech Rep. 69 42 82 Poland 64 44 52 Slovakia 57 25 33 Hungary 49 31 58 OECD COUNTRIES (SELECT) United States 81 69 85 France 76 40 91 United Kingdom 75 58 45 Germany 71 23 88

Oversight audit 100 100 42 92 59 50 75 83 92 67 83 100 75 92 75

Source: International Budget Partnership (2015c).

That said, what is then even more striking is that Russia’s budget transparency is in fact comparable to many OECD countries, which are ostensibly the leaders in best practices of budget transparency (Carlitz et al., 2008) – countries such as the UK, the US, France, and Germany. Russia’s score of 74/100 is entirely in line with that of France (76/100) and the United Kingdom (75/ 100), and is higher than that of Germany (71/100). Furthermore, as the International Budget Partnership notes (2015a), the numbers have been improving for Russia over time, for whereas Russia scores 74 in overall budget transparency as of 2015, the number was only 60 in 2010 and even lower at 47 in 2005 (IBP, 2015a). Such a steady improvement is a credit to budget reform efforts, particularly in the audit portion of the transparency assessment wherein the greatest improvement has been realized. As mentioned earlier, budget reform in Russia since 2001 has laid emphasis on a strong auditor role in budget oversight. However, improvements have also come on the legislative oversight, because as mentioned earlier, the post-communist transition in Russia involved a devolution of power from the executive to the legislature (Diamond, 2005; Kraan et al., 2008). Yet legislative oversight tends to be weak among post-communist countries. As Chohan and Jacobs (2017) have shown, legislative oversight is important in enhancing the

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accountability of the budget process, and legislative institutions (e.g. parliamentary budget offices) create public value (2017). It is a limitation to public value creation in Russia and similar post-communist countries that the legislative role in oversight is still not maximized. Nonetheless, the greatest obstacle to public value creation arises from yet another factor: the low citizen participation in the budget process. This is a topic explored in a previous chapter in this book that considered the success of South Africa in advancing citizen participation in budgeting. Whereas Russia’s overall budget transparency score is 74/100, its citizen participation score is a mere 25/100; and this is reflected across the peer group of former Warsaw Pact countries. Public value scholars remark that there is a need to “rebuild public confidence in political institutions, and the most powerful way to do that is to seek active citizen endorsement of the policies and practices of public bodies” (Stoker, 2006, p. 48). Stoker has stated that in public value thinking there should “be a shift from a culture that accepts public acquiescence in decision making to one that expects active citizen endorsement” (2006, p. 47). This is why a stronger citizens’ role in the budget process is necessary in Russia and other post-communist countries. This is a fact also noted by the International Budget Partnership itself (2015a, 2015b) as one of its primary recommendations for budget transparency improvement. As Russia’s budget transparency is comparable to that of OECD countries, where the public value discourse is well established, it can also be inferred that these OECD countries too have much work to do in enhancing their levels of budget transparency. This fact is understood by both budget experts (von Hagen and Harden, 1995; Carlitz et al., 2008; Wehner and Renzio, 2013), and by public value theorists (Benington and Moore, 2010; Beck Jorgensen and Vrangaek, 2011). This lends credence to this chapter’s assertion that public value is a relevant discourse in post-communist countries, not simply in showing that these countries are comparable to Western liberal democracies, but even more so in showing that all of these countries collectively must strive to improve public administration and budget processes in praxis, by incorporating public value creation and then implementing value-creating strategies.

Conclusion: beyond “odious” elements Public value has been hailed as the “next big thing in public management” (Talbot, 2009, p. 167), and as this book shall continually stress, it is important to examine how versatile its application can be, particularly since public management is designed and effectuated differently in different places. In some contexts, the differences are especially stark when compared to the original setting, one of stable liberal democracies with functioning market economies, in which public value theory was originally conceived (Moore, 1995). Yet this did not prevent the essential enquiry of this chapter from identifying certain important common threads (see Table 4.1) between public value theory and the experience of post-communist institutions, and this exercise provided at

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least a minimal basis for the juxtaposition of the two. Building on these observations, this chapter combined two recent areas of advancement in public value theory – (1) the prism of budgeting in public value (Chohan and Jacobs, 2017) and (2) and advancements in research into transparency in public value (Douglas and Meijer, 2016) – to construct a case study of budget transparency in Russia, which examined the nature of budgeting in the communist, transitional, and post-communist eras, which then considered the extent to which budget transparency has been achieved up to the present day (Douglas and Meijer, 2016). In looking at Russian budget transparency, this chapter has assessed the degree to which public value is being created in making elements of the Russian budget process more accountable, transparent, and participatory. The chapter’s evaluation has shown that there is still room for greater public value contribution, but that the process has come a long way since the end of the communist era. In many ways, the progress has been substantial, and in the case of certain institutions, the level of accountability and participation in the budget process is already comparable to countries that did not experience communism. This is remarkable since these countries to which Russian budget transparency can today be compared had not been burdened by the “odious” elements of communist-era budgeting (Vanagunas, 1995, p. 88), and were not weighed down by strong vested interests from the communist era which were of a persuasion to direct institutions towards “supporting the old institutional structures, instead of reinforcing the transition” (Fischer, 1999; Lopez-Carlos and Alexashenko, 1998). Whereas this chapter has considered the minimal basis for the application of a public value discourse in post-communist contexts, what will be even more significant in the future is for public value scholars to use this minimal basis to start to provide solutions to the challenges faced by post-communist institutions. Future enquiries into public value within post-communism should suggest solutions in other “concrete managerial settings” (Meynhardt, 2009, p. 214). Public value is a discourse that is premised on creative, collaborative solutions and on a vibrant dialogue between stakeholders. In post-communist environments, such creative solutions and a more vibrant inter-stakeholder dialogue will do much to advance the transition process of institutions, because the transition from communism is still considered by many to be a work in progress (Lavigne, 2000), with continuing changes in the structure, mandate, and design of post-communist public institutions (Markova, 2004; Crotty and Rogers, 2012). Public value theory can help to inform the post-Communist experience in meaningful ways, and future areas of examination where this enquiry can be extended include, inter alia, the importance of politicians (Wanna and Rhodes, 2007) and leadership more broadly (Wallis and Gregory, 2009) in post-communist societies; networked governance in post-Communist countries (Stoker, 2006); the public value of state owned enterprises and public-owned services (Beitika, 2014); management control systems (Spano, 2009); the provision of public services such as healthcare, education, public safety, and public utilities

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(Douglas and Meijer, 2016); and the need for independence and nonpartisanship in the dialogue over allocating public resources (Chohan, 2013a; Chohan and Jacobs, 2017). Such areas of investigation will help to provide public value-oriented solutions to the pressing problems of postcommunist societies, but also reaffirm the versatility of public value as the next big lens for the public sector.

References Alford, J., and O’Flynn, J. (2009). Making sense of public value: Concepts, critiques and emergent meanings. International Journal of Public Administration, 32(3/4), 171–191. Bahry, D. (1980). Measuring communist priorities: Budgets, investments, and the problem of equivalence. Comparative Political Studies, 13(3), 267–292. Beck Jorgensen, T., and Vrangbaek, K. (2011). Value dynamics: Towards a framework for analyzing public value changes. International Journal of Public Administration, 34(8), 486–496. Beitika, I. (2014). Development of public service broadcasting and public value: A case study of Latvia. In Media, Power and Empowerment: Central and Eastern European Communication and Media. Cambridge: Cambridge Scholars Publishing. Beitika, I., and Brikse, I. (2013). How do members of parliament view the public value of public service media? The case of Latvia. Polish Political Science Review, 1(1), 17–28. Benington, J. (2009). Creating the public in order to create public value? International Journal of Public Administration, 32(3/4), 232–249. Benington, J., and Moore, M. (2010). Public Value: Theory and Practice. Basingstoke, UK: Palgrave MacMillan. Carlitz, R., Renzio, P. de, Krafchik, W., and Ramkumar, V. (2008). Budget transparency around the world. OECD Journal on Budgeting, 9(2), 1–17. Chohan, U. W. (2013a). Canada and the global network of parliamentary budget officers. Canadian Parliamentary Review, 36(3), 17–20. Chohan, U. W. (2013b). The Role of Parliaments in the Extractive Industries. Washington, DC: World Bank Institute. Chohan, U. W., and Jacobs, K. (2017). Public value in politics: A legislative budget office approach. International Journal of Public Administration, 40(12), 1063–1073. Cini, M. (2008). European Commission reform and the origins of the European Transparency Initiative. Journal of European Public Policy, 15(5), 743–760. Crotty, J., and Rogers, P. (2012). The continuing reorganization of Russia’s environmental bureaucracy. Problems of Post-Communism, 59(4), 15–26. Diamond, J. (2003). Budget system reform in transitional economies: The experience of Russia. Emerging Markets Finance and Trade, 39(1), 8–23. Diamond, J. (2005). Reforming the Russian budgetsSystem: A move to more devolved budget management? International Monetary Fund Working Paper, WP/05/14. Douglas, S., and Meijer, A. (2016). Transparency and public value: Analyzing the transparency practices and value creation of public utilities. International Journal of Public Administration, 39(12), 940–951. Echols, J. M. (1975). Politics, budgets, and regional equality in communist and capitalist systems. Comparative Political Studies, 8(3), 259. Fischer, S. (1999). What went wrong in Russia? Financial Times, September 27, 26.

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Grimmelikhuijsen, S. G., and Meijer, A. (2014). Effects of transparency on the perceived trustworthiness of a government organization: Evidence from an online experiment. Journal of Public Administration Research and Theory, 24(1), 137–157. Hernandez-Cata, E. (1995). Russia and the IMF: The political economy of macro-stabilization. Problems of Post-Communism, 42(3), 19–26. Hirszowicz, M. (1980). The Bureaucratic Leviathan: A Study in the Sociology of Communism. Oxford: M. Robertson. Hollander, P. (1967). Observations on bureaucracy, totalitarianism, and the comparative study of communism. Slavic Review, 26(2), 302–307. International Budget Partnership (IBP) (2015a). Guide to the Open Budget Questionnaire: An Explanation of the Questions and Response Options. Retrieved from Washington, DC: http://internationalbudget.org/wp-content/uploads/OBS2015-Questionnaire-a nd-Guidelines-English.pdf International Budget Partnership (IBP) (2015b). OBS Tracker, The Open Budget Survey Tracker [OBS Budget Data]. International Budget Partnership (IBP) (2015c). Open Budget Index. Kraan, D.-J., Bergvall, D., Hawkesworth, I., Kostyleva, V., and Witt, M. (2008). Budgeting in Russia. OECD Journal on Budgeting, 8(2), 1–58. Lavigne, M. (2000). The economics of the transition process: What have we learned? Problems of Post-Communism, 47(4), 16–23. Lopez-Carlos, A., and Alexashenko, S. V. (1998). Fiscal Policy: Issues During the Transition in Russia. Washington, DC: International Monetary Fund. Lowy, M. (1981). The Politics of Combined and Uneven Development: The Theory of Permanent Revolution. London: NLB. Markova, I. (2004). Trust and Democratic Transition in Post-communist Europe (vol. 123). Oxford: Oxford University Press. Matveeva, A. (2008). Exporting civil society: The post-communist experience. Problems of Post-Communism, 55(2), 3–13. Meyer, A. G. (1967). The comparative study of communist political systems. Slavic Review, 26(1), 3–12. Meynhardt, T. (2009). Public value inside: What is public value creation? International Journal of Public Administration, 32(3/4), 192–219. Mishler, W., and Rose, R. (1997). Trust, distrust and skepticism: Popular evaluations of civil and political institutions in post-communist societies. Journal of Politics, 59(2), 418–451. Mishler, W., and Rose, R. (2001). What are the origins of political trust? Testing institutional and cultural theories in post-communist societies. Comparative Political Studies, 34(1), 30–62. Moore, M. (1995). Creating Public Value: Strategic Management in Government. Cambridge, MA: Harvard University Press. Moore, M. (2007). Recognising public value: The challenge of measuring performance in government. In J. Wanna (ed.), A Passion for Policy: Essays in Public Sector Reform. Canberra: Australian National University. Moore, M., and Donahue, J. (2012). Ports in a Storm: Public Management in a Turbulent World. Cambridge, MA: Harvard University. Moore, M., and Khagram, S. (2004). On creating public value: What business might learn from government about strategic management. Retrieved from Harvard Kennedy School, Cambridge, MA: www.innovations.harvard.edu/creating-public-va lue-what-business-might-learn-government-about-strategic-management

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O’Flynn, J., and Alford, J. (2008). Public value: A stocktake of a concept. Paper presented at the Twelfth Annual Conference of the International Research Society for Public Management, Melbourne. Prebble, M. (2016). Is “we” singular? The nature of public value. American Review of Public Administration, 48(2), 103–118. Pryor, F. (1968). Public Expenditures in Communist and Capitalist Nations. Homewood, IL: Irwin. Solnick, S. (1996). The political economy of Russian federalism: A framework for analysis. Problems of Post-Communism, 43(6), 13–25. Spano, A. (2009). Public value creation and management control systems. International Journal of Public Administration, 32(3/4), 328–348. Stapenhurst, F., and Pelizzo, R. (2002). A bigger role for legislatures. Finance and Development, 39, 46–48. Stoker, G. (2006). Public value management: A new narrative for networked governance? American Review of Public Administration, 36(1), 41–57. Talbot, C. (2009). Public value: The next “big thing” in public management? International Journal of Public Administration, 32(3/4), 167–170. Tverdova, Y. (2012). The formation of economic perceptions in post-communist countries of East Central Europe. Political Behavior, 34(1), 137–158. van der Waal, Z., and van Hout, E. T. (2009). Is public value pluralism paramount? The intrinsic multiplicity and hybridity of public values. International Journal of Public Administration Review, 32(3/4), 220–231. Vanagunas, S. (1995). Problems of budgeting during “The Great Transformation”. Public Budgeting and Finance, 15(1), 84–95. Varga, M. (2013). State strategies of resisting social accountability. East European Politics and Societies, 27(4), 727–742. von Hagen, J., and Harden, I. (1995). Budget processes and commitment to fiscal discipline. European Economic Review, 39, 771–779. Wallis, J., and Gregory, R. (2009). Leadership, accountability and public value: Resolving a problem in “new governance”? International Journal of Public Administration, 32 (3/4), 250–273. Wanna, J., and Rhodes, R. (2007). The limits to public value, or rescuing responsible government from the Platonic gardens. Australian Journal of Public Administration, 66(4), 406–421. Wehner, J., and Renzio, P. de (2013). Citizens, legislators, and executive disclosure: The political determinants of fiscal transparency. World Development, 41, 96–108. Welsh, W. (1977). Interregional Variations in Public Goods and Services: Some Methodological Issues and a Preliminary Analysis. Berlin: Jahrbuch der Wirtschaft Osteuropas. White, J. (2009). The president’s budget vs. congressional budgeting: Institutionalizing the adversarial presidency? In J. Thurber (ed.), Rivals for Power: Presidential-Congressional Relations. New York: Rowman and Littlefield. White, S. (1982). The Supreme Soviet and budgetary politics in the USSR. British Journal of Political Science, 12(1), 75–94. Wildavsky, A. (1964). The Politics of the Budgetary Process. Boston: Little Brown.

Part II

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5

Public value and illiberal democracy

Introduction: the illiberal persuasion The aim of this chapter is to examine the threat posed to public managers and their public value creation efforts in “illiberal democracies.” Taking the case studies of two independent fiscal institutions in Hungary and Venezuela, the chapter identifies the impediments and ultimate disbandment of both institutions as suggestive of the dangers to public value creation when democracies develop an illiberal bent. Using Moore’s strategic triangle, the chapter identifies the curtailment of public managers under illiberal systems as unfavorable to value creation. It is important to present two clear definitions at this early juncture of what populism and illiberal democracies represent in public value terms. Populism can be defined as the movements by politicians to mobilize citizens against public managers so as to question their legitimacy, reduce their operational resources, and curtail their authorizing environment. The illiberal democracy is a system where such movements are reinforced through sustained domination of politicians over public managers and citizens, which curtails the civil liberties afforded to society and the value creation initiatives afforded to public managers. In essence, movements of populism and illiberal democracies make it difficult to engage in what Lowndes et al. call the “renewal of citizen consent” (2006, p. 552); and what Benington and Turbitt term the “coalition of sufficient support” that must be forged to generate legitimacy in the eyes of the public (2007, p. 383). This chapter is a continuation of the discussion in an earlier chapter on the supranational public in the EU, because the findings of that chapter suggested that populism, insofar as it is a reactionary attempt by politicians to mobilize citizens against public managers and their institutions, is a likely outcome of the disenfranchisement of the public against value creation efforts that are either insufficient or unrepresentative of the values that they have articulated. This chapter looks more carefully at the insinuation of that earlier discussion, in the sense that populist reprisals driven by politicians aim to gain an electoral advantage by discrediting the legitimacy of public managers; and this is relevant to the public value discourse because legitimacy is one of the core nodes of the public value strategic triangle (Moore, 1995).

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The budgetary lens deployed in this chapter is of case studies of two independent fiscal institutions: (1) Venezuela’s Economic and Financial Advisory Office (OAEF); and (2) Hungary’s Fiscal Council (HFC). It considers their fate as indicative of the delegitimization of public managers in illiberal systems, which stifles their value creation efforts. The chapter therefore suggests that illiberal democracies are settings in which public managers’ value creation is made considerably more difficult. However, in a later chapter of this book that uses the Congressional Budget Office (CBO) of the United States to discuss the “post-truth era,” a contrasting view will be presented of the re-legitimization of the public manager in a populist and increasingly politically illiberal environment. That chapter is foreshadowed here to inform the reader that this book will present both sides of the argument on illiberalism and populism – that on the one hand, the public manager’s work will be considerably more challenging and at the risk of institutional termination (this chapter), but on the other hand, the public manager has a unique opportunity to re-legitimize her work before the public and resist the politicians who seek to de-legitimize her role (a later chapter). As the illiberal democracy is an entirely new topic for discussion in public value theory, there are three important reasons for its incorporation in a chapter within this book. First, illiberal democracies are increasingly a reality across the world and are a marked aspect of politics in the early 21st century, which makes it important for public value theory to subsume, or at least attempt to subsume, their salience into the public value dialogue. Second, an objective of this book is to extend public value theory into new contexts (e.g. developing countries, post-communist societies, supranational publics, etc.), and this chapter extends the public value dialogue to a new and interesting context as part of the larger endeavour of the book. Third, this chapter demonstrates one of the challenges of public value creation by looking at the possibly fatal obstacles faced by public managers in their value creation efforts, in the sense that an illiberal democracy can pose a terminal risk to the function of independent value-creating institutions of public managers. The structure of this chapter is as follows. First, it will discuss the theoretical notion of the illiberal democracy as it has evolved across disciplines in the past two decades. Second, it will present two brief case studies on independent fiscal institutions in Hungary and Venezuela, to discuss the terminal risk faced by public managers in illiberal systems. Third, it will deploy Moore’s strategic triangle (Moore, 1995), which is “the central symbol of public value” (Alford and O’Flynn, 2009), to situate those case studies in extant public value frameworks. A concluding section will summarize the findings and allude to the later discussion in this book, which presents a counter-argument to that developed in this chapter.

The illiberal democracy Although public value has not subsumed the topic of illiberal democracies in any substantive manner as of this writing, a lingering fear about the perceived negative social outcomes thought and believed to arise from such systems has

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nonetheless been alluded to on occasion in public value writings. Most notably, Benington notes that “the public realm is under current challenge from tendencies which undermine the sense of inter-dependence within a multi-cultural society—for example, racism, sexism, fascism, fundamentalism, brutalization and consumerism, which fragment the notion of what we have in common as a public” (2009, p. 235). Public value scholars remark that there is a need to “rebuild public confidence in political institutions, and the most powerful way to do that is to seek active citizen endorsement of the policies and practices of public bodies” (Stoker, 2006, p. 48). Benington warned of “an alternative form of legitimation for the actions and the interventions of the state given the erosion of confidence in elected representative government” (2009, p. 245). As Williams and Shearer remark, public value offers “an affirmation of managerial ingenuity and expertise, albeit within a binding democratic order” (2011, p. 1372), but it is precisely this “binding” sense of “democratic order” which is challenged in illiberal systems. Moore himself noted the vulnerabilities of politicians to “many different kinds of corruption” which would “affect the moral claims of political decision-making” (1995, pp. 54–55). He later also noted that “while the political system often says that it wants accountability, and occasionally demands it, it is usually reluctant to negotiate a stable deal about what constitutes public value” (2007, p. 99). In Moore’s words, “the primacy in defining public values must be reserved to citizens [in the given context] and their representatives acting through the collective processes of government” (1994, p. 304). Prebble (2012, 2016) and also Williams and Shearer (2011) raise questions about the role of politicians and civil society in responding with hostility towards public managers assuming greater power, a point that Wanna and Rhodes take much further in alleging that public value theory is inherently anti-democratic (2009). The same authors further warned that reprisals against public managers could occur and “get nasty, bite them back, leave them exposed” (2007, p. 414). Meanwhile, Chohan and Jacobs (2018) have observed the public value consequences of rhetoric deployed both by public managers and politicians alike, finding that rhetoric is an instrument both can use in trying to address the contradictory values articulated by the public. Moore himself noted that public managers would always be mired in “imperfect political agreements” (1995, pp. 54–55). Indeed, the questions of “how to rebuild trust within communities which are disunited, divided and demoralized,” and of “how to develop confidence, trust, and loyalty between the people and the public authorities,” did loom in the background of public value’s discourse (Benington, 2009, p. 244). Benington aptly pointed out that the “powerful influence of civil society upon the state” has been increasingly remarked upon following “popular mass movements for democratization in Eastern Europe, South Africa and Latin America” (2009, p. 241). However, public value theory has yet to address the effects of illiberal democracies in terms of value creation and the public manager’s roles and mandates in such systems.

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That said, the notion of an “illiberal democracy” is not quite so old, and nearly contemporaneous with public value theory itself. It emerges from a dialogue in political science and history departments about the supposed preeminence of liberal democracies following the end of the Soviet Union in the penultimate and ultimate decades of the twentieth century (see also the chapter in this volume on public value in post-communist societies). Most notoriously, the historian and political scientist Francis Fukuyama grandiosely claimed that human society had arrived at the “end of history,” since the post-communist world would give way to a supposed flourishing of liberal democracies around the world (1989). Invariably, Fukuyama’s claim reflected a broad triumphalism in the West about the direction that societies should take in ushering liberaldemocratic arrangements. However, while the claims about the triumph of liberal democracy seem fanciful in the hindsight of the nearly three decades that have elapsed, it was already within but a few years that the hyperbole of Fukuyama’s claims was challenged by the practical difficulties of finding enough new democracies that would truly assume what is understood to be a liberal democracy’s general form. This led academics such as Bell and Jayasuriya (1995) and Zakaria (1997) to independently assign the term “illiberal democracy” to the emergent hybrid arrangement between the idealized liberal democracy and elements of autocratic rule. Much of the early work on illiberal democracies drew upon Asiatic contexts, such as Indonesia and Singapore, which appeared to have developed comparatively efficient socio-political structures, albeit ones not fully concordant with those theorized to reflect liberal democracies (Bell and Jayasuriya, 1995; Zakaria, 1997). Yet subsequent analyses over the past two decades have found that illiberal democracies represent a growing trend in political arrangements around the world, and in addition to Asia and Africa, can also be found in South America, where Venezuela is a leading example (Smith and Ziegler, 2008; Buxton, 2011), and now close to the European heart of liberalism, where Hungary and Poland are leading examples (Kallius et al., 2016; Innes, 2015; Krasztev and Van Til, 2015). It is important to recognize that the tone of academic inquiry into illiberal democracies differs between regions depending in large part on the economic success they have attained. For example, in Asian contexts, as manifested by the Singaporean example, the illiberal democracy has been studied with the curiosity that it presents a viable and arguably sustainable political-economic system (Bell and Jayasuriya, 1995; Zakaria, 1997). By contrast, in South American contexts, as manifested by the Venezuelan example, the illiberal democracy is studied critically as a deficient model unable to “fulfil the economic requirements” of citizenry (“public value creation”, in an important sense), that a typical liberal democracy could achieve (Smith and Ziegler, 2008; Buxton, 2011). That critical tone is now found to extend to the newer illiberal democracies in Eastern Europe, including Poland and Hungary (Kallius et al., 2016; Innes, 2015; Krasztev and Van Til, 2015). The United States under the

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Donald Trump government is also seen to exhibit illiberal tendencies (Gaughan, 2016), which shall be examined more carefully in a later chapter of this book on the “post-truth era.” The salient aspects that separate illiberal democracies from liberal ones involve the decoupling of democratic practice (e.g. elections), from the preservation of civil liberties (e.g. freedom of speech or assembly), and this decoupling raises questions about the exercise of power and structures of accountability made available to ordinary citizens (see also Chohan and Jacobs, 2017). While the notion of populism has been closely tied to illiberal democracies in recent years, as in Venezuela, the United States, Turkey, Hungary, or Poland; it is not an absolute necessity for an illiberal democracy to have populist leanings. Yet for the purposes of this chapter, the populist tendencies of politicians in illiberal settings are also considered with respect to the power and legitimacy of public managers. The attitudes of politicians themselves towards the terms “illiberal” and “populist” are also mixed. For example, the Chávez government of Venezuela embraced the term “populist” as representing the will of the people (Smith and Ziegler, 2008; Buxton, 2011). Similarly, the Orban government of Hungary has openly embraced the term “illiberal” as a respectable form of government that best articulates the collective interests of the people without atomizing them as disconnected individuals (see Kallius et al., 2016; Innes, 2015; Krasztev and Van Til, 2015). Venezuela and Hungary are but two examples in an increasing array of what may be termed illiberal democracies. From a budgetary perspective, they share a common narrative regarding their independent fiscal institutions (IFIs): both were created, hamstrung, and then terminated. As IFIs are a powerful tool for studying public value in the political realm (Chohan, 2017, 2018), the dismantling of two IFIs may prove instructive for the examination of public value challenges in illiberal democracies. The following section examines the Venezuelan Oficina de Asesoría Económico y Financiera de la Asamblea Nacional (hereafter OAEF, English translation: Economic and Financial Advisory Office of the National Assembly) and the Hungarian Költségvetési Tanács (hereafter HFC, English translation: Fiscal Council). This is done with a view to positing the strategic triangle (Moore, 1995) and the public value implications for public managers and politicians in illiberal democracies thereafter. 1 Venezuela Venezuela has experienced tumultuous changes in its politics, its economy, as well as in its society, over the past four decades; and while some of these experiences are shared with Latin American neighbours, others are duly attributable to crises of an entirely domestic nature (Buxton, 2011; Smith and Ziegler, 2008; Puente et al., 2006; Pereira and Melo, 2011; Santiso and Varea, 2013; Santiso, 2004). Venezuela is considered a prime example of an illiberal democracy under both the previous Chávez and current Maduro governments

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(see detailed discussions in Buxton, 2011; Smith and Ziegler, 2008). As a resource-rich developing country (RRDC, see Chohan, 2013), much of Venezuela’s fiscal balance has depended on oil exports. In the last three decades of the twentieth century, extractive revenues from oil accounted for 80% of total exports, 90% of total foreign assets, and 50% of total fiscal income (Puente et al., 2006). As with all RRDCs, a strong accountability architecture to manage its extractive wealth had been of keen import (Chohan, 2013). In particular, the shocks to fiscal balances between different periods of booms and busts in oil prices, with highs in the 1970s and lows in the 1980s, demonstrated that more nonpartisan analysis of oil revenues was needed to make the fiscal path of the Venezuelan nation more sustainable (Puente et al., 2006). To that effect, in 1997 the Venezuelan government created the OAEF as an independent fiscal institution to provide technical advisory services to the National Assembly on financial matters including the extractive industries and oil revenues (Santiso, 2004). It was created with support from budget experts at the Inter-American Development Bank (IADB), a regional sister organization to the World Bank (Santiso, 2004; Santiso and Varea, 2013). In its early days, the OAEF was considered an excellent budget office, and one that Santiso and Varea describe as maintaining “high technical standards” (2013, p. 12). As Pereira and Melo note, the OAEF was initially comprised of 15 “highly qualified personnel, with high-level degrees from Venezuela and the Unites States” (2011, p. 13), and its staff eventually expanded to 24 full-time professionals. Its head and chief economist, Francisco Rodriguez, had a doctoral degree in economics from Harvard University and had been serving as professor at the University of Maryland. In its first two years of operations, the office cemented a reputation for strong nonpartisan fiscal analysis (Rojas and Zavarce, 2004; Santiso 2004; Santiso and Varea, 2013; Puente et al., 2006). The OAEF was not formulated as a political office, and with regard to the advisory-costings framework of Chohan and Jacobs (2017), the OAEF would be described more as a costings-related institution, which would have ostensibly lowered the risk of political recrimination, as it largely created public value through nonpartisan fiscal work such as costings. However, the OAEF did identify incidences of fiscal corruption and imprudent spending to the Finance Committee of the National Assembly, which implies that it began to be adorned by some features of a normative-advisory IFI (see Chohan and Jacobs, 2017). Analysis by Chohan (2017) has suggested that there is a common pattern among IFIs in terms of early success followed by a gradual encroachment, or rather perceived encroachment, upon the political turf of powerful institutions in the budget process, which is met by possibly heavy recrimination (see also Chohan and Jacobs, 2017, 2018). Such a pattern is not relegated to developing countries, but has also been observed in jurisdictions such as the United States and Canada (Chohan, 2017). In the case of Venezuela, when the illiberal democracy was being forged under the leadership of Hugo Chávez, the OAEF came into the political crossfires due to its independent fiscal stance that produced budget projections to the dislike of the Chávez government, and which

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vocally expressed its opinions on imprudent national spending. As with other IFIs, the illiberal democracy in Venezuela pushed back, but to a more severe extent. Santiso describes it mildly in stating that “increasing tensions” since President Hugo Chávez took power “undermined the functioning of this office” (2004, p. 65). There were in fact two bouts of contention between the Chávez government and the OAEF (Rojas and Zavarce, 2004; Pereira and Melo, 2011). In the first instance (2000), the OAEF was suspended from operation; and in the second, it was finally terminated (2004). In the first instance of contention, even as the Chávez government had already begun to purge many institutions (Buxton, 2011; Smith and Ziegler, 2008), it did not immediately eliminate the OAEF. Rather, it initially sought to replace all staff with a more compliant and less vocal group of employees (Rojas and Zavarce, 2004). However, political infighting, resistance within the National Assembly and pressure from the InterAmerican Development Bank (IADB) made this too difficult to achieve (Santiso, 2004), and so the institution was left suspended for the period of slightly less than one year. It was resumed as part of the recommencement of a suspended loan from the IADB, and in restarting its operations, the OAEF also continued its battle to push for increased budget accountability and the identification of imprudent spending in the illiberal democratic regime. This led to the second instance of contention where the severity of the attack against the OAEF was much greater. As analysis by Pereira and Melo has shown, according to internal documents of the US State Department, the OAEF’s chief had been accused by the Chávez government of “working for the opposition and supporting the military commanders that removed President Hugo Chávez from power” (2011, p. 14). This accusation served as the pretext for delivering a coup de grâce against the OAEF. Rodriguez was officially stripped of his position on March 29, 2004, for allegedly “questioning the honour of the President of the National Assembly” for articulating his concerns that the OAEF was “being persecuted because it had warned the National Assembly’s Finance Committee of imprudent spending within the budget” (Pereira and Melo, 2011, p. 14). In an ensuing debate within the National Assembly, the chamber’s president, Francisco Ameliach, did not recognize the independence of the OAEF and argued that legal and international advisory offices were not inherently independent as such. Around the time of its disbandment, twothirds of the twenty-four OAEF staff were incorporated into the National Assembly as civil servants (Pereira and Melo, 2011). However, Rodriguez did not resign without a fight, and initiated a conflictof-authority lawsuit before the Tribunal Superior de Justicia (Superior Justice Court), petitioning the court to declare that the OAEF was indeed an independent institution with a degree of autonomy to fulfil its mandate. This claim was dismissed by the court on the grounds that Rodriguez was not in a position of legitimacy to initiate claims on behalf of the National Assembly. Since that time, which is to say, nearly fifteen years thence, although the OAEF does still have a website address within the National Assembly’s online portal, its own

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online domain does not work and no descriptions of its mandate, role, work, or staff is provided. It may therefore be correctly termed a defunct IFI. 2 Hungary Although the current prime minister of Hungary, Victor Orban, was once celebrated as an anti-communist and anti-authoritarian revolutionary, his Fidesz government has evidenced strong tendencies of an illiberal democracy since coming to power in 2010 (Kallius et al., 2016; Innes, 2015; Krasztev and Van Til, 2015). This title of “illiberal” is one that Orban himself has embraced, arguing that illiberal systems are effective and that such systems “are not Western, not liberal, not liberal democracies, maybe not even democracies – and yet they are making nations successful” (Innes, 2015, p. 95). This thinking is in marked contrast to the role that Orban played during the transition from communist rule, when he embraced the liberal values advanced by the EU. In Hungary’s accession to the EU, members of his Fidesz government, along with those before his, advocated across-the-board adoption of EU standards in the Hungarian social, political, and economic domains (Innes, 2015; Krasztev and Van Til, 2015). Among these standards were those involving IFIs, as fiscal councils were being promoted throughout the EU, both for the improvement of budgetary transparency (see also the previous chapter on the EU), and as a response to the global financial crisis of 2008 (GFC). Given that a “relatively well-functioning inflation targeting regime, run by the Monetary Council of the National Bank of Hungary, had been in operation since 2001,” it was thought that a parallel in fiscal policy could be adopted to the Monetary Council in the form of an IFI (Kopits and Romanyi, 2013, p. 217). There was also a domestic impetus in that the prime minister as of 2006, Ferenc Gyurcsány, and his cabinet “had lied repeatedly about the condition of Hungary’s public finances” (Innes, 2015, p. 98), and in a leaked party speech he “had insisted that the economy could no longer sustain the party’s promises,” a point that has been described by Innes as “remarkable for its suicidal honesty regarding the country’s financial realities” (2015, p. 98). Indeed, the mismanagement and unsustainable nature of public finances in Hungary was such that the general government deficit peaked at nearly 10% of GDP, the highest among EU member countries (Kopits and Romanyi, 2013, p. 214). In response, Hungary passed a Fiscal Responsibility Law in 2008, under which the Hungarian Fiscal Council (HFC) was elected unanimously in February, 2009, and it commenced operations in June of that year. The law provided the HFC with near total independence from the government and substantial independence from the parliament in its day-to-day operations. According to the advisory-costings framework of Chohan and Jacobs (2017, 2018), the HFC would be described as both fulfilling an advisory and a costings role, with its prime mandate involving the analysis of budget bills, the provision of macrofiscal projections, other forecasts, and quantitative assessments of budgetary proposals (see also Kopits and Romanyi, 2013, p. 218).

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The HFC’s main goal was to create public value by restoring policy credibility in fiscal matters, both for the Hungarian public domestically and for financial markets internationally. Its own target for this was to see the sovereign risk premium of the country fall to that in-line with neighbouring countries. The value of these public managers would thus also lie in reducing the annual interest bill accruing to Hungary through improved fiscal policy credibility. The HFC took a proactive approach to preparing its budget analyses, “mainly to establish its identity in front of the public, but partly to quell initial scepticism from the media and in response to pressures from opposition parties all too eager to antagonize the government” (Kopits and Romanyi, 2013, p. 219). Nevertheless, the analyses of the HFC continued to highlight the pro-cyclical, unsustainable fiscal path that the Hungarian government was following. The HFC conducted its work before and immediately after the 2010 elections that brought Orban’s centre-right illiberal Fidesz party to power. Orban’s Fidesz enjoyed a two-thirds parliamentary majority, and with it a sweeping control of the legislature. With this, it radically reworked the Fiscal Responsibility Law of 2008 and targeted the HFC during that overhaul (Kopits and Romanyi, 2013). The Fidesz government sought to balance the budget through unsustainable one-offs, as for example when “one of Fidesz’s first measures in government was to expropriate private pension funds, shifting them back into the public budget to create a one-off surplus: an act as damaging to Hungary’s international financial credibility as the Socialists’ earlier lies” (Innes, 2015, p. 99). The HFC’s analyses went against the Fidesz government’s “reckless” fiscal policy, which was leading to a “sharp erosion in policy credibility” that was rooted “not only in an actual rise in public indebtedness, but also in the opaque demeanour of the authorities” (Kopits and Romanyi, 2013, p. 216). The Fidesz government “made several attempts to dilute or remove” budgetary standards, and the HFC “repeatedly called attention to these departures from the law, urging the government to comply” (Kopits and Romanyi, 2013, p. 220). As Kopits and Romanyi note, the illiberal government “sought to mould existing institutional arrangements to suit its political preferences and did not tolerate any criticism inherent in checks and balances” (2013, p. 221). In addition to the HFC, the Fidesz government also engaged in “full-frontal attacks” on central bank independence, foreign investors, the judiciary, and various other institutions. The HFC expressed critical views about the government’s lack of a coherent mediumterm budgetary plan and its over-optimistic forecasts. In swift response, the government used the pretext of cost savings to have the HFC’s technical staff disbanded and the office itself terminated without cause. Despite considerable hue and cry in the European, local, and international media, the government’s majority in parliament allowed it to proceed with the disbandment quickly. Since the HFC was created through an act of Parliament, it could also be disbanded by the same process, and it was. In its place, a smaller entity was created with a more limited remit, which according to Kopits and Romanyi was “a Council in name only,” and thus, “following a rapid gestation

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period, the Fiscal Council was in effective operation for nearly two years before its demise” (2013, p. 212). Kopits and Romanyi reflect that the short-lived experience of the HFC “illustrates in fast motion” the range of challenges faced by an IFI in an illiberal democracy, due to factors including “an environment characterized by a tradition of fiscal indulgence and opacity, by low policy credibility, by a fragile system of checks and balances, and by reluctance to shed past practices” (2013, p. 213). As Innes remarks, the institution-grabbing by the government reveals “a lack of viable and popular long-term plans for national development” (2015, p. 97). Kopits and Romanyi (2013) see an irony in the termination of the IFI in that its termination was a reflection of its effectiveness: because of its success in promoting greater transparency and accountability, it met a quick death after just two budget cycles. Its termination was also symptomatic of a broad-based reduction in transparency in the illiberal democracy of Hungary, with many independent institutions bearing the brunt both then and since.

Public value challenges in illiberal democracies It has been recognized throughout this book that IFIs are a powerful lens for the assessment of public value creation (but see contrasting discussion in the previous chapter on the European Union). In earlier works, it was argued that IFIs are a “natural dialogue” between public managers and politicians (Chohan and Jacobs, 2017, p. 1063), and that they create value for the public through the enhanced efficiency and democracy they help foster through higher transparency and accountability in the budget process (Chohan and Jacobs, 2017, 2018; Chohan, 2017, 2018). With that in mind, it is important to consider the challenges to public value creation that arise when IFIs are terminated in illiberal democracies, as with the OAEF in Venezuela and the HFC in Hungary. To this end, this section first discusses the roles of the three actors in public value: the public managers, the politicians, and civil society; as they change in illiberal democracies. It then introduces Moore’s strategic triangle (1995), the “central symbol” of public value (Alford and O’Flynn, 2009, p. 173) to frame these issues in a theoretical context. In the introductory section to this chapter, two definitions were provided regarding populism and illiberal democracy. Populism can be defined as the movements by politicians to mobilize citizens against public managers so as to question their legitimacy, reduce their operational resources, and curtail their authorizing environment. The illiberal democracy is a system where such movements are reinforced through sustained domination of politicians over public managers and citizens, which curtails the civil liberties afforded to society and the value creation initiatives afforded to public managers. These definitions lie at the core of what is different in public value between liberal and illiberal democracies; that politicians seek to increase their relative power over public managers by delegitimizing them, questioning their value contribution, and snatching their operational resources (which is to say, all

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three nodes of the strategic triangle). In the chapter on supranational public and the EU in this volume, one of the propositions put forth was that public managers may face a difficulty of legitimization in the eyes of citizens, and this loss of trust is seized upon by politicians to varying degrees. Citizens may articulate contradictory values (Chohan and Jacobs, 2018), and those citizens who support illiberal regimes and populist governments express public values that may override their civil liberties, because they might prioritize other considerations or values instead. Public managers are put in a lower position and create less value because of a disapproval articulated by citizens and galvanized by politicians. It is as Meynhardt has keenly observed, “legitimization by numbers may appear a less complex challenge than facing the challenge of a pro-active dialogue about ‘why our work is valuable to society’” (2009, p. 214). Wanna and Rhodes warned that reprisals against public managers could occur and “get nasty, bite them back, leave them exposed” (2007, p. 414). Moore himself noted that public managers would be victims of “imperfect political agreements” (1995, pp. 54–55). In essence, movements of populism and illiberal democracies make it difficult to engage in what Lowndes et al. call the “renewal of citizen consent” (2006, p. 552); and what Benington and Turbitt term the “coalition of sufficient support” that must be forged to generate legitimacy in the eyes of the public (2007, p. 383). This can be expressed diagrammatically in Figure 5.1. Citizens express dissatisfaction with public managers and with politicians. Politicians seize upon this situation to curtail public managers and suppress their

Figure 5.1 Public managers in illiberal democracies Source: Moore’s Strategic Triangle (1995); Author Research

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authorizing environment. Politicians mobilize citizens against public managers to delegitimize them. In the case of Hungary, the populist and proudly illiberal Fidesz government antagonized independent institutions of public managers including the HFC, the monetary authority, the judiciary, and countless others (Innes, 2015). In Venezuela, the illiberal Chávez and Maduro governments systematically undermined and dismantled independent public manager institutions including the OAEF in much the same way (Buxton, 2011; Pereira and Melo, 2011). In the case of both countries, politicians mobilized the citizenry against public manager institutions they deemed inept, dangerous, dissenting, or corrupt. Neither the HFC nor the OAEF survived this, and in the meantime the illiberal governments enjoyed soaring popularity in elections. The mandate of the people, disenfranchised by economic inequality, a sense of entitlement to social spending that was fiscally unsustainable, and the appeal of populist rhetoric, cemented the politicians’ ability to eliminate the authorizing environment of the public managers in the meanwhile. Critics of public value theory raise a concern in saying that public value’s subjacent tendency may be to pretend “that there are no political tensions that cannot be resolved through sophisticated technocracy” (Oakley et al., 2006, p. 3). This technocratic bent is a straightforward bête noire that populist politicians target, and it is one of the fundamental principles that these illiberal democracies reject: that sophisticated technocracy can address the values articulated by the public. But this point requires more nuance: not all illiberal democracies are anti-technocratic. While Hungary and Venezuela dismantled numerous independent technocratic institutions including their IFIs, there are other illiberal democracies which base their legitimacy on technocratic expertise. Singapore and China are two exemplary countries that have espoused illiberal policies on the basis of technocratic efficiency. They highlight the trade-off that is explicit in public value discussions between efficiency and democracy (see Stoker, 2006; Chohan, 2018), championing the former at the expense of the latter. By contrast, the illiberal governments of Venezuela and Hungary have not framed the tradeoff as such, but rather sought other means of dismantling public manager institutions, one example being the attack on the OAEF when its head Sr. Rodriguez was accused of disloyalty (Pereira and Melo, 2011, p. 13). Public value scholars remark that there is a need to “rebuild public confidence in political institutions, and the most powerful way to do that is to seek active citizen endorsement of the policies and practices of public bodies” (Stoker, 2006, p. 48). Populist politicians counteract this approach by seeking active citizen endorsement to undermine the policies of public bodies, and thus to further diminish public confidence in those institutions. The strategic triangle can be applied to see how public managers, in this case at the HFC and OAEF, faced limitations on all three accounts: recognition of their public value, legitimacy, and operational resources.

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Table 5.1 Assessing the OAEF and HFC through Moore’s strategic triangle Criteria Recognition of value

OAEF and HFC (IFIs) No

Legitimacy and support

No

Operational capabilities

No

Total

0/3

OAEF: The Chávez government did not believe that the OAEF contributed to value creation, and considered it to be (1) working as an agent for the opposition to undermine the government, and (2) a mere stipulation by foreign lenders (IADB) to try to further hamstring the government. HFC: The Orban government did not believe that the HFC contributed to value creation, and treated the fiscal analysis of the HFC as subversive, pro-EU, and an impediment to the execution of its budget value. OAEF: The legitimacy of the OAEF’s analysis was undermined. First, the president of the National Assembly argued that the OAEF cannot be an independent institution. Second, the Superior Court ruled that the OAEF could not petition its case. HFC: The Orban government rejected the pleadings of the HFC to build a more sustainable budget outlook premised on more realistic assumptions and a medium-term plan. It considered the HFC to be an expensive and illegitimate institution that served as but a nuisance in the budget process. OAEF: While initially being endowed with “high technical standards” and excellent staff from the best Venezuelan and American institutions, as well as expertise lent from the IADB, the operational capabilities of the OAEF were soon removed, its legal mandate restricted, and, finally, two-thirds of the 24 OAEF staff were incorporated into the National Assembly as civil servants. HFC: Although initially equipped with well-trained economists, a reasonable budget, and a high degree of independence, the office was ultimately stripped of operational capability in each of these areas.

Source: Moore (1995); author research.

Evidently, the disbandment of the OAEF and HEC represented an eschewal of all three nodes of the strategic triangle. First, a recognition of public value creation by the managers at the OAEF and HFC was not met. The Chávez government considered the HFC to be (1) working as an agent for the opposition to undermine the government, and (2) a mere stipulation by foreign lenders (IADB) to try to further hamstring the government (Pereira and Melo, 2011; Santiso, 2004; Puente et al., 2006). Similarly, the Orban government treated the fiscal analysis of the HFC as subversive, as pro-EU, and as an impediment to the execution of its budget value (Kopits and Romanyi, 2013). Second, both the Orban and Chávez governments refused to confer legitimacy on their IFIs, arguing against their independence and treating them as nuisances that lacked a legitimate presence in

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the budget process. Third, although both IFIs were initially well endowed, they were stripped of their operational capabilities including their budgets, their access to information, their staff, their leadership, and their legal status. A strategic triangle view helps to frame the challenges that institutions of public managers face in illiberal democracies on all three fronts. It demonstrates the immense risks that public value-creating institutions confront, leading to their restriction and curtailment, and even their demise. It also confirms Moore’s observation that public managers would be victims of “imperfect political agreements” (1995, pp. 54–55).

Conclusion: illiberal arbiters Illiberal democracies are increasingly a reality across the world and are a marked aspect of politics in the early 21st century, which makes it important for public value theory to subsume, or at least attempt to subsume, their salience into the public value dialogue. This chapter represents an early attempt to do so, and it has found that the structures of illiberal democracies are confrontational and threatening to the independence, viability, and value creation of public managers. In terms of public value’s three main actors; populism represents the mobilization of citizens against public manager institutions by politicians. The illiberal democracy systematically reinforces the domination of such politicians over public managers, against which public managers face the choice of docile compliance or elimination, as the IFIs in Venezuela and Hungary demonstrate. Citizens who stand with illiberal democracies are articulating and prioritizing values other than those pertaining to their immediate liberties, and politicians are seizing upon the disenfranchisement of citizens with the shortfalls in the value creation efforts of public managers. Politicians may well be the “final arbiters of public value” in Moore’s words (1995, p. 38), but as illiberal arbiters, their actions can lead to the elimination of public manager institutions, such as the removal of the OAEF and HFC through acts of parliament. Yet value creation depends on the values articulated by citizens, and when citizens express preferences for values other than those addressed by particular public managers, then public managers are perhaps in a democratic sense somewhat redundant to the citizenry. The rhetoric of politicians, which Chohan and Jacobs have found to be a means for prioritizing between contradictory values held by citizens (2018), can confound the efforts of public managers to negotiate their authorizing environment. An objective of this book is to extend public value theory into new contexts, beyond that of liberal democracies in which public value theory was originally conceived. This chapter extends the public value dialogue to a new and interesting context as part of the larger endeavor of this book. It is evident that, as with supranational entities, developing countries, and post-communist societies, illiberal democracies too can be contextualized in public value terms, and public value is instructive to understanding the problems of a public administration nature that arise in such systems. Those problems can pose a terminal

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risk in an illiberal democracy to the function of independent value-creating public institutions. But is the verdict on populist and illiberal democracies truly so damning? Is there not some hope for the public manager in an era of illiberalism? Although this chapter presents the case that public managers are struck by weighty adversity, a later chapter in this book on the “post-truth era” turns the argument here on its head and argues instead that the era of post-truth illiberalism in fact offers a unique opportunity for public managers to reassert their legitimacy and demonstrate their ability to create value for the public. Therefore, this book examines both sides of the argument, and these contrasting analyses, in my judgement, only enrich the examination of public value theory in democratic societies.

References Alford, J., and O’Flynn, J. (2009). Making Sense of Public Value: Concepts, Critiques and Emergent Meanings. International Journal of Public Administration, 32(3/4), 171–191. Bell, D. A., and Jayasuriya, K. (1995). Understanding illiberal democracy: A framework. In D. A. Bell, and K. Jayasuriya, and D. Jones, Towards Illiberal Democracy in Pacific Asia. London: Palgrave Macmillan. Benington, J. (2009). Creating the public in order to create public value? International Journal of Public Administration, 32(3/4), 232–249. Benington, J., and Turbitt, I. (2007). Policing the Drumcree demonstrations in Northern Ireland: Testing leadership theory in practice. Leadership, 3(4), 371–395. Buxton, J. (2011). Venezuela’s Bolivarian Democracy: Participation, Politics, and Culture under Chávez. Durham: Duke University Press. Chohan, U. W. (2013). The Role of Parliaments in the Extractive Industries. Washington, DC: World Bank Institute. Chohan, U. W. (2017). Independent budget offices and the politics-administration dichotomy. International Journal of Public Administration. Chohan, U. W. (2018). The roles of independent legislative fiscal institutions: A multidisciplinary approach (doctoral thesis), University of New South Wales (UNSW), Canberra. Chohan, U. W., and Jacobs, K. (2017). The presidentialization thesis and parliamentary budget offices. Parliamentary Affairs, 70(2), 361–376. Chohan, U. W., and Jacobs, K. (2018). Public value as rhetoric: A budgeting approach. International Journal of Public Administration, 41(15), 1217–1227. Fukuyama, F. (1989). The end of history? The National Interest, 16, 3–18. Gaughan, A. J. (2016). Illiberal democracy: The toxic mix of fake news, hyperpolarization, and partisan election administration. Duke Journal of Constitutional Law and Public Policy, 12(57), 57–139. Innes, A. (2015). Hungary’s illiberal democracy. Current History, 114(770), 95. Kallius, A., Monterescu, D., and Rajaram, P. K. (2016). Immobilizing mobility: Border ethnography, illiberal democracy, and the politics of the “refugee crisis” in Hungary. American Ethnologist, 43(1), 25–37. Kopits, G., and Romanyi, B. (2013). Hungary: A short-lived fiscal watchdog. InG. Kopits (ed.), Restoring Public Debt Sustainability: The Role of Independent Fiscal Institutions. Oxford: Oxford University Press.

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Krasztev, P., and Van Til, J. (2015). The Hungarian Patient: Social Opposition to an Illiberal Democracy. Budapest: Central European University Press. Lowndes, V., Pratchett, L., and Stoker, G. (2006). Local political participation: The impact of rules-in-use. Public Administration, 84(3), 539–561. Moore, M. (1994). Public value as the focus of strategy. Australian Journal of Public Administration, 53(3), 296–303. Moore, M. (1995). Creating Public Value: Strategic Management in Government. Cambridge, MA: Harvard University Press. Moore, M. (2007). Recognising public value: The challenge of measuring performance in government. In J. Wanna (ed.), A Passion for Policy: Essays in Public Sector Reform. Canberra: Australian National University. Oakley, K., Naylor, R., and Lee, D. (2006). Giving Them What They Want: Constructing the ‘Public’ in Public Value. London: BOP Consulting. Pereira, C., and Melo, M. (2011). The political economy of budgeting in Latin America: Procedures, oversight, and participation. CAF Working Paper No. 2011/13. www.caf.com/media/4165/201113pereira.pdf Prebble, M. (2012). Public value and the ideal state: Rescuing public value from ambiguity. Australian Journal of Political Administration, 71(4), 392–402. Prebble, M. (2016). Is “we” singular? The nature of public value. American Review of Public Administration, 48(2), 103–118. Puente, J. M., Daza, A., Rios, G., and Rodriguez, A. (2006). The political economy of the budget process: The case of Venezuela. InterAmerican Development Bank Working Papers: Economic Sector and Study Series, RE3–06–007. Rojas, E., and Zavarce, H. (2004). Instituciones para la Coordinación de la Política Monetaria y Fiscal: Un enfoque transaccional para el caso venezolano. Working Papers of the Central Bank of Venezuela, BCV-01–04. Santiso, C. (2004). Legislatures and budget oversight in Latin America: Strengthening public finance accountability in emerging economies. OECD Journal on Budgeting, 4(2), 47–76. Santiso, C., and Varea, M. (2013). Strengthening the capacities of parliaments in the budget process. Inter-American Development Bank, Institutional Capacity of State Division, IDB-PB-194. Smith, P. H., and Ziegler, M. R. (2008). Liberal and illiberal democracy in Latin America. Latin American Politics and Society, 50(1), 31–57. Stoker, G. (2006). Public value management: A new narrative for networked governance? American Review of Public Administration, 36(1), 41–57. Wanna, J., and Rhodes, R. (2007). The limits to public value, or rescuing responsible government from the Platonic gardens. Australian Journal of Public Administration, 66(4), 406–421. Williams, I., and Shearer, H. (2011). Appraising public value: Past, present and futures. Public Administration, 89(4), 1367–1384. Zakaria, F. (1997). The rise of illiberal democracy. Foreign Affairs, 76(22), 22–43.

6

Public value between nations

There are but two great routes in the universe: the Silk Road and the Milky Way Uzbek proverb

Introduction: shared values, different administrations Public value has historically sought to situate the roles of public administrators within a domestic context, one that presumes a discrete national boundary and set of structures for value creation geared towards a domestic public (see Alford and O’Flynn, 2009; Benington and Moore, 2010; Chohan, 2017a, 2017b, Meynhardt, 2009; Moore, 1995, 2003, 2014; Spano, 2009; Williams and Shearer, 2011). By contrast, the aim of this chapter is to consider public value creation between nations (between “publics”), and how the politicians, bureaucrats, civil society of two nations can work towards mutual value creation, along with the challenges that ensue in such efforts. In proceeding along this line of enquiry, the chapter seeks to push public value theory into a more globalized context, one that is more reflective of a 21st-century reality wherein notions of the public are more geographically fluid (Benington and Moore, 2010). Public administrators are expected to serve a public that isn’t necessarily confined by political boundaries, but rather in “a space which includes but is not coterminus with the state” (Benington, 2009, p. 233). The internationalization of public administration, both in an academic and practitioner sense, behooves scholars to consider how the interplay between bureaucrats, politicians, and citizens between countries can be more fully understood (Bannister and Connolly, 2014; Prebble, 2015; Douglas and Meier, 2016). As such, this chapter examines the China-Pakistan bilateral relationship through the Long-Term Plan for the China-Pakistan Economic Corridor: 2017–2030 (LTP), which is described as the “conceptual framework” of the China-Pakistan Economic Corridor (CPEC), to consider value creation initiatives between two publics. A long-term plan serves as a useful lens for public value enquiry because as Benington (2009, p. 240) rightly observes, public value is an outcomes-based approach that evaluates meaningfully over the long term.

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A previous chapter in this volume discussed the challenges confronting a supranational public in the EU, which is composed of various national publics with their own separate and sometimes conflicting sets of values. In that case, the supranational public managers themselves are confronted by challenges arising from imbalances between publics, problems of incentivization, the transfer of operational resources away from national public managers, and a loss of trust felt by subsets of the composite public. Those challenges undermine the legitimacy of supranational public managers, and lead to questions about the viability of a supranational public. By contrast, this chapter looks at the problem of public value creation between publics differently. Rather than considering how an agglomeration of publics can create value, it looks at a different problem: how do independent nations with common goals and amical relations mobilize their public administrations to co-create value? And how do public managers, politicians, and citizens express those values and adhere to a bilateral commitment towards mutual value creation? This is not the same as the supranational question because it does not presuppose the creation of a supranational public administration. It does not require an agglomeration of the publics, and it recognizes the different values articulated by the publics as they are to be met by separate bodies of politicians and public managers. The China-Pakistan relationship allows for such an enquiry to be pursued, as their bilateral arrangement is inherently different from that constructed by European nations under the auspices of their union (Vandewalle, 2015), both in its breadth (the EU covers more facets of socioeconomic life) and depth (the EU has a greater intrusion into each society to fundamentally transform them). Indeed, the CPEC is part of a larger global project of economic integration and value creation known as the One Belt One Road (OBOR), which involves a more diverse array of countries spanning three continents at a minimum (Chohan, 2018a, 2018b). However, it covers fewer socioeconomic aspects and intrudes less into each society, thereby leaving the publics at the national level largely intact. Its purpose may be seen as one of reviving old connections and restoring mechanisms of value creation between publics along the ancient Silk Route that spanned the Eurasian landmass. Although spearheaded by China, OBOR represents a process of value creation between nations, and so it depends heavily on counterparty countries to pull their weight in terms of proactive engagement by citizens, public managers, and politicians converging towards mutual interests (Mahapatra, 2018; Wolf, 2018; Ali and Faisal, 2017). Yet these countries range from the very large to the comparatively small, which is to say that substantial economic and power differentials exist between them (Chohan, 2018b; Beeson, 2018a, 2018b; Silin et al., 2018). At the same time, and more importantly, the values articulated by citizens in each of these countries may well be markedly different, and so it goes for their public administrations and political structures (see “values” discussion in Selmier, 2018; Chohan, 2018a). This raises an opportunity for examining how two countries

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with public value factors (bureaucratic systems, political structures, and social values) in countries as different as China and Pakistan can co-create value for their publics. Towards that end, the structure of this chapter is as follows. First, the chapter will review some of the literature on public value with a view to highlighting its presuppositions of domestic value creation, to then emphasize the need for its internationalization (and more precisely, bilateralization). Second, it will identify three values: prosperity, pride, and harmony, as they are articulated by Chinese citizens – earlier for domestic value creation and now for bilateral and international value co-creation. The chapter also applies the strategic triangle to Pakistan to briefly demonstrate why those three values have only been achieved to a limited extent, which is a useful application of the triangle to a national public, in that it can summarily “diagnose the existing situation” (Alford and O’Flynn, 2009, p. 174). Third, the chapter will use the LTP to demonstrate how bilateral values are articulated and then addressed by public managers and politicians. A final section will provide concluding remarks.

Is public value a domestic theory? Public value is a body of thought premised on certain assumptions about society. Other chapters in this book have sought to identify some of these assumptions and then push public value beyond the confinements of those assumptions. In this chapter, a specific assumption is identified regarding the domestic nature of public value, in that it assumes a discrete national boundary and set of structures for value creation geared towards a domestic public (see Alford and O’Flynn, 2009; Benington and Moore, 2010; Chohan, 2017a, 2017b, Meynhardt, 2009; Moore, 1995, 2003, 2014; Spano, 2009; Williams and Shearer, 2011). This is a reflection of its original intent, which was to train public managers in the United States and similar countries in a manner that recognized their role in co-creating value for society in concert with other domestic actors, including domestic politicians and a domestic citizenry (Alford and O’Flynn, 2009; Benington and Moore, 2010; Moore, 1995, 2003, 2014; Williams and Shearer, 2011). Such an attitude towards the role of public managers was certainly à propos in the 1990s when Moore first formulated public value (Moore, 1994, 1995). However, significant global forces have pushed citizens, politicians, and even public managers situated within national boundaries to look outwards (Benington and Moore, 2010; Beck Jorgensen and Vrangbaek, 2011;). Meynhardt observed that public value seeks answers to questions about how people “think and feel about society?” (2009, p. 193), but perhaps an equally salient contemporary question is how people think about societies other than their own. Although a potent anti-globalist backlash has fomented in the past few years (Speed and Marion, 2017; Gross, 2017), the general trend for public administration over the past 30 years has been to look internationally and outwards rather than inwards, and although Moore’s earlier writings foresaw this

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trend (Moore, 1994, 1995, 2007), his early works failed to emphasize the sheer importance of this momentum towards globalization. However, Moore’s later works, particularly Ports in a Storm: Public Management in a Turbulent World (Moore and Donahue, 2012) stressed that the public manager’s gaze must be directed outwards to create value in a turbulent, complex, and highly interconnected world. Therefore, although a rich body of public value research has emerged in the past 20-odd years (see reviews in Alford and O’Flynn, 2009; Williams and Shearer, 2011; Prebble, 2016), I consider the claim that the underlying assumption of public value as a domestically oriented theory has remained preponderant, and that it is important for scholars to move outwards beyond that domestic milieu. To proceed in an enquiry of bilateral public value co-creation, what is required is a suitable lens to examine bilateralism, without stepping into the ambit of the supranational public value that has been addressed in a previous chapter. The China-Pakistan relationship presents an example where value creation transcends their national boundaries (Chohan, 2018a, 2018b), as public managers from both sides are working in concert across an array of projects executed in accordance with the demands of political institutions from both countries. Moore opined that politicians are the “final arbiters of public value” (Moore, 1995, p. 38), and a substantial amount of political will and valueseeking imagination is being invested in the realization of the CPEC projects (Chohan, 2018a, 2018b; Wolf, 2018; Mahapatra, 2018; Malik, 2018). The China-Pakistan example is also interesting in that it studies two countries whose public administration structures are not just different from one another, but also substantially dissimilar to those in countries which lay within the scope of public value’s original theorization (i.e. North America, Europe, and Australia). The dissimilarity of Chinese public administration to other models helps explain why there is scant research into Chinese public value creation, and this is not a point that could be subsumed in a previous chapter on post-communist societies, because the unique public administrative structures of contemporary China are difficult to situate in the dichotomies (communist vs. capitalist, state vs. market, or even communist vs. post-communist) found in the public administration literature (see state vs. market example in Benington, 2009). As such, this chapter can go along a different route to examine Chinese public value circuitously in terms of its relationship to OBOR and to Pakistan. To that end, the next sections delineate CPEC with a view to situating its purpose, its underlying values, and the work of two sets of public managers in co-creating public value within that context.

What values underlie OBOR? The China-Pakistan Economic Corridor is an important artery within the larger architecture of the One Belt One Road (Mahapatra, 2018; Malik, 2018; Beeson 2018a, 2018b), which is in turn the largest integrated project of globalization attempted thus far in the 21st century (Chohan, 2018a, 2018b; Ali

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and Faisal, 2017; Wolf, 2018). The estimates of its size exceed the $60 billion USD mark for CPEC and more than $1 trillion for OBOR at large. The governments of Pakistan and China describe CPEC as “a growth axis and a development belt featuring complementary advantages, collaboration, mutual benefits and common prosperity” (LTP, 2017, p. 3). CPEC it is intended to span the domains of transport, urban planning, energy, communications, materials, logistics, and industry. Public value poses questions about how people “think and feel about society,” and which values can address them accordingly (Meynhardt, 2009, p. 193). While there are numerous reasons, on both the Chinese and the Pakistani side, for realizing this megaproject, it is worthwhile enumerating three that speak to public value creation and are mentioned within the LTP: prosperity, national pride, and harmony. See Table 6.1. Table 6.1 Selected Chinese values underpinning OBOR and CPEC Value Prosperity

Pride

Harmony

Meaning

Domestic example

OBOR example

Creating economic prosperity and fostering well-being by growing the level of economic resources available to the people as a whole and advancing opportunities to individuals that form the collective. Cultivating and preserving a positive sense of national selfworth.

Politicians have said that “to be rich is glorious” since the 1970s. Public managers have carved out a unique path to prosperity through the execution of a systematic plan for public value creation, thereby cementing their legitimacy. Citizens have articulated their desire for continued prosperity. Citizens have articulated their desire to feel respected and proud in numerous ways. Politicians have sought to cultivate this sense of pride by creating domestic economic strength and social stability, which public managers have pursued as key priorities. The publics within China have for millennia placed great emphasis on achieving harmony at both the social and individual level. Politicians have sought to mitigate conflicts through the exercise of tacit and overt power, mobilizing public managers to create systems that at least attempt to foster harmony.

Public managers cannot maintain economic growth rates by remaining confined to the domestic public. OBOR is thus a vehicle to grow and sustain prosperity. OBOR helps to share prosperity and allow China to take on a leadership position, thereby instilling further pride in the public.

Harmony is a notion of interrelatedness that eschews the disequilibrium of the public created by misanthropy, instability, and violence.

Source: Author research.

Domestic harmony is best assured alongside international harmony, and OBOR is a project that fosters better, more harmonious relations in China’s near-abroad.

100 Challenges in public value creation First, Chinese politicians and public managers have a mandate to promote the value of prosperity, by continuing the economic growth trajectory that has lifted the greatest number of people out of poverty in human history (Beeson, 2018a, 2018b). Citizens have insinuated their emphasis on prosperity, while politicians too, beginning with Deng Xiaoping in the 1970s, have articulated the importance of prosperity, famously when Deng said that “to be rich is glorious” (see Allison, 2017; Faure and Fang, 2008; Garrott, 1995; Kulich and Zhang, 2010). Public managers, insofar as they serve the (Communist) Party and the people, seek to address the need for continued growth in levels of prosperity. They have carved out a unique path to prosperity through the execution of a systematic plan for public value creation (see Allison, 2017), and have thereby cemented their legitimacy, which is one of the three nodes of the strategic triangle (Moore, 1995). However, public managers cannot maintain as high a growth rate by remaining confined to a single domestic public. There are many more high-growth countries where the operational resources (capital) accumulated by China can be better deployed to earn higher returns, and Pakistan is a “natural destination” in this regard (LTP, 2017; see also Chohan, 2018b). In fact, the LTP explicitly mentions prosperity as a value (goal) in proclaiming that CPEC should proceed “in the spirit of partnership towards prosperity” (LTP, 2017, p. 11). Second, Chinese citizens and politicians have articulated the value of national pride, and have also in that regard acceded to the notion of “shared prosperity” which emerges from the aforementioned value of prosperity itself. By sharing the fruits of their prosperity, Chinese politicians believe that greater stability and an even higher level of prosperity can be achieved (Beeson, 2018a; Chohan, 2018a). Chinese citizens appear to agree with this assertion as they consider their nation’s leadership in sharing prosperity to be a point of national pride (Shen and Guo, 2013; Steele and Lynch, 2013; Allison, 2017). This pride should not be mistaken for jingoism or national chauvinism (Shen and Guo, 2013), but rather as a sense of positive national self-worth (Pew Research Center, 2018). Assuming a leadership position in the world and advancing a sense of shared well-being are sources of pride and are thus of immediate concern to Chinese public managers seeking to address public value creation by instilling greater pride among the citizens that collectively constitute the public. Third, the innumerable publics which have resided within the territories of modern-day China have for several millennia cherished the value of “harmony,” which emphasizes co-existence and an order based on respect and mutual recognition (Faure and Fang, 2008; Garrott, 1995; Kulich and Zhang, 2010). Public managers are prioritising “harmony” because this is a mainstay value both for politicians and for citizens in China (Shen and Guo, 2013; Steele and Lynch, 2013). But the next step in promoting harmony is to internationalize its scope to include publics that reside in China’s near-abroad; and OBOR, by expanding and sharing the scope of prosperity, cements the degree of harmony achieved in China’s geopolitical neighborhood. The value of “harmony” is explicitly indicated in the guidelines of the LTP, along with “mutual benefits” (prosperity), and “inclusiveness” (pride), and “sustainability”

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(2017, p. 10; see public value rhetoric on sustainability in Chohan, 2017a; Chohan and Jacobs, 2018). Insofar as China-Pakistan relations are concerned, there is little room to doubt that Pakistani public managers, politicians, and citizens also seek to cocreate value by addressing these three values of prosperity, pride, and harmony as well (Jalal, 1995; Jaffrelot, 2002; LTP, 2017), and not just in rhetoric (see Chohan, 2017a; Chohan and Jacobs, 2018). A simmering desire to restore national prosperity, pride, and harmony has filled countless debates among public managers, politicians, and citizens at all levels in Pakistan throughout its independent history (Jaffrelot, 2002; Jalal, 1995), but the ability to satiate those values has remained limited over the past 70 years due to difficulties at all three nodes of Moore’s strategic triangle (1995; see also Alford and O’Flynn, 2009). These limitations are discussed briefly in Table 6.2. The application of the strategic triangle to a national public such as Pakistan indicates where limitations have been faced by politicians and public managers in attempting to create public value. Applying the strategic triangle to the evolution of a national public is an innovative idea in that the triangle is normally applied to organizations or to systems within the public – not to the public itself. Yet the strategic triangle serves as a useful shorthand to consider why value creation has been limited at the national level as well, and future research can expand this point of approaching national publics through the strategic triangle to, as Alford and O’Flynn have put it, “diagnose the existing situation” (2009, p. 174). For the purposes of this chapter, the strategic triangle analysis in Table 6.2, in highlighting the limitations that Pakistan has faced on the three nodes of the triangle, also sets the backdrop for its amenability to bilateral value co-creation with China through CPEC. The following section examines this process of cocreation as delineated in the budget document titled the Long-Term Plan for the China-Pakistan Economic Corridor: 2017–2030 (LTP, 2017).

Bilateral value creation When the citizens of two nations articulate a desire to co-create value bilaterally, they are pushing their politicians, public managers, and even civil society to allocate resources to achieve public value creation that is mutually beneficial. This point resonates with Mark Moore’s assertion that public managers should be “orchestrating the processes of public policy development, often in partnership with other actors and stakeholders” (Benington and Moore, 2010, p. 4). But since there are multiple, hybrid interpretations of public value creation (Beck Jorgensen and Vrangbaek, 2011), it is important for both nations to demonstrate a full, long-term, common commitment towards value co-creation. In this regard, the LTP is described as the “conceptual framework” of CPEC that “matches the national plans” of both countries (LTP, 2017, p. 2). It recognizes the public value creating agents of both countries whereby “the Chinese and Pakistani governments and people that have been working hard to

102 Challenges in public value creation Table 6.2 Strategic triangle and public value shortcomings in Pakistan Triangle node

Explanation

Legitimacy

- Politicians have faced continuous difficulties in cementing their legitimacy. At the internal level, this has occurred through factional infighting. At the external level, it is best exemplified by half of the country’s political life being spent under military rule. Corruption scandals, electoral malpractice, feudal vestiges, and cults of personality have also derailed the legitimacy of democratically elected politicians. - Public managers have faced perennial difficulties in executing their mandates due to questions of legitimacy. Once a potent instrument for value creation (1947–1969), Pakistan’s civil service (public managers) have lost ground to parallel institutions, political meddling, incompetence, the erasure of merit, and de-legitimization in the eyes of the public. - The contribution of democratically elected politicians to public value creation has also been contested, both within political fields (e. g. parliament), but from external institutions (judiciary, military). - The contribution of public managers to value creation has been contested by parallel authorities and the encroachment of private- and semi-private sector actors, in addition to reductions caused by political meddling. Various half-hearted “civil service reforms” have only complicated the ability of public managers to create public value. - As with many a developing country, politicians have not had the operational resources to fulfill democratic mandates, and high levels of corruption have substantially diminished the already limited resource base. - In a country where 95% of the population does not pay tax, and the largest sector of the economy (subsistence agriculture) does not fall in the fiscal net, public managers have had paltry budgets from the very beginning, and fiscal crises have shrunk the operational resources available to public managers even further.

Recognition of public value

Operational Resources

Source: Author research.

enrich their friendship, and set a model for friendly bilateral ties between different cultures, social systems and ideologies” (LTP, 2017, p. 2; see also Mahapatra, 2018). It frames the public value objectives of CPEC as “cementing China-Pakistan economic relations, promoting friendly cooperation, and establishing the shared destiny of the two countries” (see also Vandewalle, 2015; Chohan 2018b). The creation of CPEC is premised on a long path of prior bilateral cooperation (see Vandewalle, 2015). In the period 2012–2017, China-Pakistan trade grew annually at a rate of 18.8% on average, while bilateral investment grew by multiples, and China became the biggest source of foreign capital for Pakistan (Malik, 2018; Wolf, 2018). At the same time, both China and Pakistan enjoy different natural endowments and different levels of economic development, and the LTP emphasizes the creation of synergies based on the differing comparative advantages. The structure of CPEC is succinctly described as “1+4,” wherein the CPEC’s central architecture is treated as the core, and it is

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comprised of four components: transport, industry, energy, and the port of Gwadar. An important aspect of the presence of politicians from Pakistan in CPEC is that they hail from numerous political parties in a federation where provinces act with a fair degree of autonomy (LTP, 2017; see also Jaffrelot, 2002), and their unanimity on CPEC (as of the LTP’s promulgation in February, 2017), is seen as the “biggest testimonial to the transparency, national consensus, and efficiency of LTP and CPEC,” according to the former Pakistani minister of interior Ehsan Iqbal (LTP, 2017, p. 2). The LTP lays emphasis on collaboration between public managers, as well as the training of public managers of one country by those of the other, in that it seeks to “expand the scale of training programs in China for Pakistani central government officials, parties, and local government officials from regions along the CPEC” (2017, p. 20). It also brings together institutions of public managers from both countries and sets targets to be achieved by specific dates. By 2020, it urges public managers to give CPEC “its basic shape” while overcoming the structural “major bottlenecks” in Pakistan (LTP, 2017, p. 9). By 2025, the construction phase should be essentially complete, the industrial component approximately so, with major “economic functions brought into play in a holistic way,” and value for the public also created when “the people’s livelihoods along the CPEC [is] significantly improved.” Meanwhile, by 2030, the target is for having “the endogenous mechanism for sustainable economic growth in place,” and CPEC should thereafter “grow into an international economic zone with global influence” (LTP, 2017, p. 9). Bilateral value creation also involves the bilateral assumption of responsibilities. The LTP recognizes this when proclaiming that “through mutual consultations, China and Pakistan shall share responsibilities and fruits” (2017, p. 12). This speaks to Benington and Moore’s extensive discussion on public value creation through a wider negotiation process (2010). In bilateral public value, the consultative process is conducted between public managers, politicians, and civil society in parallel to the negotiation process that public managers conduct with stakeholders within their own society. This is illustrated in Figure 6.1. International negotiation processes (mutual consultation, debate, agreement) are occurring between public managers of both countries as well as politicians of both countries. At the same time, intranational (domestic) negotiation processes between public managers, politicians, and citizens are occurring within these countries. The bilateral public value negotiation process occurs in parallel to the domestic public manager negotiations, and is described in the LTP as follows: China and Pakistan shall jointly prepare plans, divide financing responsibilities based on the project situation and their respective investment and financing strength, give play to their respective comparative advantages in project construction and implementation, and share fruits based on the match of their cost, risk and returns. (2017, p. 11)

104 Challenges in public value creation

Figure 6.1 International and domestic negotiation processes occur in parallel Source: Among the numerous values articulated by the Chinese public, three that are of interest to CPEC include prosperity, national pride, and harmony. Source: Author Research

Bilateral public value also involves stronger methods of direct and indirect communication, for which the LTP recommends establishing “a closer inter-governmental linkage mechanism” (2017, p. 12). Public value theory argues that there is a “right to operate” in an authorizing environment, which is arrived at through negotiation (Moore, 1995, p. 114). Between these two countries, the LTP declares that the right to operate in the authorizing environment must proceed in a manner that “further deepens bilateral cooperation, holds regular meetings and solves problems through consultation, strengthens the communication and cooperation between various departments, and formulates detailed plans and cooperation agreements that will be implemented jointly” (LTP, 2017, p. 26). But how does this megaproject translate into value for citizens? The LTP breaks out the specific motive of creating value for the public under the category of “improved livelihood,” arguing that “the improvement of people’s livelihood is on the top of the agenda of the CPEC project, whose spatial layout fully reflects the regional development gap,” and which “focuses on improving basic public services for local residents,” while “all-round industrial cooperation [is to] show preference for local residents in employment,” and “the exchange and cooperation in areas concerning people’s livelihood [is to] lean towards the ordinary people” (LTP, 2017, p. 12). This specific commitment is crucial to understanding the public value creation of CPEC, and it is in fact what makes CPEC pertinent to a public value discussion at all. By focusing on the “improvement of livelihoods,” public managers and politicians are seeking to translate operational resources into value creation targeted at the ordinary public. Stoker has remarked that there is a need to build confidence in public institutions, and that “the most powerful way to do that is to seek active citizen endorsement of the policies and practices of public bodies” (2006, p. 48). Civil society is also directly addressed in the LTP, when both countries stress the desire to “strengthen the communications

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among non-governmental organizations, develop extensive project cooperation centered on public opinions communication, and people-to-people friendship” (2017, p. 20). Recent research on public value has emphasized the importance of accountability mechanisms in public value creation (Chohan, 2017a, 2017b; Chohan and Jacobs, 2017, 2018). At the bilateral level, CPEC addresses this by forming a goal assessment mechanism, described as “an assessment mechanism that shall be established to evaluate the implementation of major projects, assess the progress of the long-term plan in every aspect every five years, and then update and adapt the plan accordingly” (LTP, 2017, p. 20). Finally, recent research has emphasized power of rhetoric as deployed by public managers and politicians alike (Chohan, 2017a; Chohan and Jacobs, 2018). Rhetoric has been emphasized throughout the LTP and in external speeches made by the politicians of both countries. In the LTP, remarkable examples of bilateral commitment include the following: “we shall bring China and Pakistan closer to each other with the physical economic bond of the CPEC and form a community of indivisible common destiny” (2017, p. 11); and that the long-term plan for the China–Pakistan Economic Corridor has an ambitious goal and an arduous task. As long as the governments and people of the two countries treat each other with all sincerity and cooperate sincerely, they will build the CPEC into an open, inclusive one with economic prosperity, social stability and security, and the wellbeing of people. (2017, p. 27).

Conclusion: Silk Road and Milky Way Public value has largely been a domestic theory in that its theorists have recognized the importance of internationalization and globalization of public administration but have not explored theorizations of these processes to a sufficient degree. This is not reflective of the 21st-century reality wherein notions of the public are more geographically fluid and public administrators are expected to serve a public that isn’t necessarily confined by political boundaries. Public value itself is the product of a different time, and was tailored to a different audience of liberal Western democracies. Neither Pakistan nor China would fit into that description, and yet CPEC serves as a useful means of examining bilateral value creation. An assessment of the LTP and the possibilities of cooperation between China and Pakistan through CPEC, as explored in this chapter, does indeed indicate that bilateral public value creation is possible. Whereas OBOR is the most significant global economic project of the early 21st century, it proceeds with assumptions about cooperation between nations such that their publics remain largely intact. This means that it does not fall prey to the same challenges that a supranational entity does, as explored in a previous chapter. The findings of this chapter are that what is required for bilateral public value above all is that such an endeavor addresses values

106 Challenges in public value creation articulated by both sides, which in this case include prosperity, harmony, and pride, among others. Thereafter, there must be a strong articulation of commitment from politicians and public managers on both sides, as has been done for CPEC. After this, a robust plan that covers both the vision, the direction, the mechanisms for execution, the mechanisms for accountability, and the mechanisms for distribution of responsibilities must be laid down – and that is the purpose of the LTP. The most important insight in this chapter is that negotiation processes between public managers and politicians occur both intranationally and internationally. These processes permit for the right to operate in a bilateral authorizing environment. It is only through such means that a project as ambitious as CPEC (and OBOR) can be properly realized. Will CPEC succeed in creating value for the two publics? At the very least, it will represent an effort towards public value creation between two countries in spite of various fundamental differences between them. The challenges notwithstanding, it is as Benington (2009, p. 240) rightly observes, public value is an outcomes-based approach that evaluates meaningfully over the long term. At the same time, the task of bilateral value creation has been described as arduous by the involved groups of public managers and politicians alike. The dream of reviving the old Silk Road, a cornerstone of international prosperity in its halcyon days, still hold emotive value for the publics re-intertwining through OBOR. As such, it is perhaps best to conclude this chapter in emphasizing that emotive value, as an Uzbek proverb perfectly depicts, “there are but two great routes in the universe: the Silk Road and the Milky Way.”

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Benington, J., and Moore, M. (2010). Public Value: Theory and Practice. Basingstoke, UK: Palgrave MacMillan. Chohan, U. W. (2017a). Public value and bureaucratic rhetoric. In A. Farazmand (ed.), Global Encyclopedia of Public Administration, Public Policy, and Governance. New York: Springer. Chohan, U. W. (2017b). Public value: Bureaucrats vs politicians. InA. Farazmand (ed.), Global Encyclopedia of Public Administration, Public Policy, and Governance: New York: Springer. Chohan, U. W. (2018a). The political economy of OBOR. In J. Chaisse and J. Gorski (eds), The Belt and Road Initiative: Law, Economics, Politics. Netherlands: Brill Nijhoff. Chohan, U. W. (2018b). What is One Belt One Road? A surplus recycling mechanism approach. In J. Chaisse and J. Gorski (eds), The Belt and Road Initiative: Law, Economics, Politics. Leiden: Brill Nijhoff. Chohan, U. W., and Jacobs, K. (2017). Public value in politics: A legislative budget office approach. International Journal of Public Administration, 40(12), 1063–1073. Chohan, U. W., and Jacobs, K. (2018). Public value as rhetoric: A budgeting approach. International Journal of Public Administration, 41(15), 1217–1227. Douglas, S., and Meijer, A. (2016). Transparency and public Value: Analyzing the transparency practices and value creation of public utilities. International Journal of Public Administration, 39(12), 940–951. Faure, G. O., and Fang, T. (2008). Changing Chinese values: Keeping up with paradoxes. International Business Review, 17(2), 194–207. Garrott, J. R. (1995). Chinese cultural values: New angles, added insights. International Journal of Intercultural Relations, 19(2), 211–225. Gross, M. (2017). The dangers of a post-truth world. Current Biology, 27(1), 1–4. Jaffrelot, C. (2002). Pakistan: Nationalism Without a Nation. London: Zed Books. Jalal, A. (1995). Conjuring Pakistan: History as official imagining. International Journal of Middle East Studies, 27(1), 73–89. Kulich, S. J., and Zhang, R. (2010). The multiple frames of ‘Chinese’ values: From tradition to modernity and beyond. In M. H. Bond, The Oxford Handbook of Chinese Psychology. Oxford: Oxford University Press. LTP (Long-Term Plan for the China-Pakistan Economic Corridor: 2017–2030) (2017). Retrieved from www.pc.gov.pk/uploads/cpec/LTP.pdf Mahapatra, C. (2018). ‘One Belt, One Road’: China, US and the Emerging Hegemonic Struggle in Asia. In B. Deepak (ed.), In China’s Global Rebalancing and the New Silk Road. Singapore: Springer. Malik, A. R. (2018). The China–Pakistan Economic Corridor (CPEC): A game changer for Pakistan’s economy. In B. Deepak (ed.), China’s Global Rebalancing and the New Silk Road. Singapore: Springer. Meynhardt, T. (2009). Public value inside: What is public value creation? International Journal of Public Administration, 32(3/4), 192–219. Moore, M. (1994). Public value as the focus of strategy. Australian Journal of Public Administration, 53(3), 296–303. Moore, M. (1995). Creating Public Value: Strategic Management in Government. Cambridge, MA: Harvard University Press. Moore, M. (2003). The public value scorecard: A rejoinder and an alternative to “Strategic performance measurement and management in non-profit organizations” by Robert Kaplan. Hauser Center for Nonprofit Organizations Working Paper No. 18. Retrieved from https://papers.ssrn.com/sol3/papers.cfm?abstract_id=402880

108 Challenges in public value creation Moore, M. (2007). Recognising public value: The challenge of measuring performance in government. In J. Wanna (ed.), A Passion for Policy: Essays in Public Sector Reform. Canberra: Australian National University. Moore, M., and Donahue, J. (2012). Ports in a Storm: Public Management in a Turbulent World. Cambridge, MA: Harvard University. Moore, M. H. (2014). Public value accounting: Establishing the philosophical basis. Public Administration Review, 74, 465–477. Pew Research Center (2018). Data on Chinese values. Prebble, M. (2015). Public value and the limits to collaboration. International Journal of Public Administration, 38(7), 473–485. Prebble, M. (2016). Is “we” singular? The nature of public value. American Review of Public Administration, 48(2), 103–118. Selmier, W. T. (2018). The Belt and Road Initiative and the influence of Islamic economies. Economic and Political Studies, 6(3), 257–277. Silin, Y., Kapustina, L., Trevisan, I., and Drevalev, A. (2018). The Silk Road economic belt: Balance of interests. Economic and Political Studies, 6(3), 293–318. Shen, F., and Guo, Z. S. (2013). The last refuge of media persuasion: News use, national pride and political trust in China. Asian Journal of Communication, 23(2), 135–151. Spano, A. (2009). Public value creation and management control systems. International Journal of Public Administration, 32(3/4), 328–348. Speed, E., and Mannion, R. (2017). The rise of post-truth populism in pluralist liberal democracies: challenges for health policy. International Journal of Health Policy and Management, 6(5), 249–251. Steele, L. G., and Lynch, S. M. (2013). The pursuit of happiness in China: Individualism, collectivism, and subjective well-being during China’s economic and social transformation. Social Indicators Research, 114(2), 441–451. Stoker, G. (2006). Public value management: A new narrative for networked governance? American Review of Public Administration, 36(1), 41–57. Vandewalle, L. (2015). Pakistan and China: ‘Iron brothers’ forever? European Parliament Directorate General for External Policies policy paper. www.europarl.europa. eu/RegData/etudes/IDAN/2015/549052/EXPO_IDA(2015)549052_EN.pdf Williams, I., and Shearer, H. (2011). Appraising public value: Past, present and futures. Public Administration, 89(4), 1367–1384. Wolf, S. O. (2018). China–Pakistan Economic Corridor (CPEC): Regional cooperation in the wider South Asian region. In B. Deepak (ed.), China’s Global Rebalancing and the New Silk Road. Singapore: Springer.

7

Public value and the post-truth era

Introduction: the post-truth zeitgeist This chapter delves into the notion of public value in “the post-truth era,” which refers to a contemporary zeitgeist wherein there is a marked decoupling of facts from public and political life (Keyes, 2004; Conway, 2017). Added as the “word of the year” by the Oxford Dictionary in 2016, the post-truth era’s “widely recognized emergence” (Tallis, 2016) is regarded as a period when facts-based discourses are supplanted by politicians’ appeals to the public’s emotions in a manner that is disconnected from the veracity, reality, or details of administrative policy implementation (Higgins, 2016; Tallis, 2016; Peters, 2017; Gross, 2017). Furthermore, in instances where factually grounded counterevidence is presented to the public or the politicians, those efforts are often met with contempt and derision (Vernon, 2017; Peters, 2017; Speed and Mannion, 2017). As such, given that the post-truth era represents a period that is dismissive of expertise and unresponsive to analytical rigor, it may indeed pose unique challenges for public managers. In essence, the public manager is characterized by her expertise, which is why the outright rejection of her knowledge and practice by both politicians and the public may prima facie suggest that her existence is moribund in a posttruth world (Tallis, 2016; Gross, 2017), and that the process of negotiating an “authorizing environment” is in peril (Moore and Khagram, 2004, p. 8). This notion was explored in a previous chapter that studied public value in illiberal democracies, showing that the de-legitimization of public managers, as with the independent budget offices of Hungary and Venezuela, bodes ill for public value creation. But the tacit consensus among public administration scholars has for decades been on the pre-eminence of pluralist liberal Western thought and its underpinning assumptions about democracy, civic participation, rationality, facts-based discourses, and accountability (Suiter, 2016; Peters, 2017; Speed and Mannion, 2017). As with the illiberal democracy, these assumptions are bitterly contested in the post-truth era as well. As chapters in this book have repeatedly remarked, public value is an example of a theory that was developed as the product of the 1990s and its tacit post-Cold War assumptions about the primacy of liberal pluralist Western

110 Challenges in public value creation democracies as the best practicable social arrangement. This can be seen in the subservient role that public managers were to play under democratically elected politicians, whose democratic mandate made them the “final arbiters” of public value (see Moore, 1995, p. 38). That line of thinking has come into question in both the paradigms of illiberal democracy and the post-truth era because the political and economic tenets of liberal Western thought are jettisoned by populist narratives (Suiter, 2016; Speed and Mannion, 2017; Peters, 2017), which may imply a repudiation of the legitimacy of the public manager and her expertise. But beyond this, the post-truth zeitgeist inherently re-envisages the relationship between the three agents of public value theory: the public, the politician, and the public manager. The aim of this chapter is to reflect on that changing relationship, and to consider the challenges and opportunities that this presents. As Stoker observes, “the emphasis in public value is on challenge and change” (2006, p. 49). This chapter considers the relationship between public managers and the post-truth public, as well as that between public managers and the post-truth politician. But it goes in a direction diametrically opposed to that in the chapter on illiberal democracies, because whereas the conclusions of that earlier chapter suggested that the consequences for public managers were dire, this chapter by contrast offers a more optimistic interpretation. It does so by presenting the contrasting argument that there is an opportunity for the reassertion of legitimacy by public managers through the process of emphasizing impartial professionalism in analysis and execution and by seizing the policy initiative and realigning the creation of value with the needs of the public. This resounds with Stoker’s assertion that there is a need to “rebuild public confidence in political institutions, and the most powerful way to do that is to seek active citizen endorsement of the policies and practices of public bodies” (Stoker, 2006, p. 48). The budgeting lens deployed in this chapter pertains to a specific case study of public managers in a post-truth context – that of the Congressional Budget Office (CBO) in the United States. The CBO has emerged as an early case study of public managers in the post-truth era and that too at the very forefront of particularly acrimonious policy domain: American public healthcare provision. As Speed and Mannion note, public health is particularly vulnerable to post-truth politics (2017, p. 250). Furthermore, a recent work on the “politics-administration dichotomy” has alluded to the importance of the CBO going forward in American healthcare, noting that “the evidence-based approach of the CBO is not just a luxury but a necessity in what is being described as a post-truth world” (Chohan, 2017, p. 6). In addition, CBO’s participation in healthcare reform in the United States provides a historical context because it is a long “saga” that spans at least three decades (see Joyce, 2011), including the Clinton-era healthcare reform in the 1990s that failed, as well as the Affordable Care Act (ACA, “Obamacare”) healthcare reform in the Obama-era which succeeded (Chohan, 2017, p. 6). This chapter deploys two public value frameworks. The first is the strategic triangle, described as the “central symbol” of public value (Alford and O’Flynn, 2009, p. 173), whose three nodes are used to examine the changing levels of

Public value and the post-truth era 111 legitimacy, recognition of value, and operational resources for the CBO in the post-truth era. Particular attention is paid to the recognition of value and the degree of legitimacy, which are under heightened threat in a post-truth context. The second framework is the advisory-costings framework of LBOs in public value theory (see Chohan and Jacobs, 2017), and in particular the “ingredients for an advisory role” (Chohan and Jacobs, 2017, p. 1070) such as fostering negotiation, raising public awareness, and questioning assumptions, as they are fulfilled in a post-truth context. The structure of this chapter is as follows. First, it proceeds by reviewing the emerging literature on the post-truth era and situates extant observations within the public value literature that pondered or even foretold the onset of such a time. Second, it presents a case study of the Congressional Budget Office and the American Healthcare Act (AHCA) that delineates the possibilities for reassertion of legitimacy through impartial analytical rigor. Third, a concluding section discusses the continued relevance of both public managers and public value theory in a post-truth world.

The problem of the public manager in the post-truth era Although there is a rich history of cataloguing the rampant incidents of lying and deceit as they play out in the political and public realms (see review in Keyes, 2004), the term “post-truth era” was explicitly enunciated by Tesich (1992), and popularized by Keyes (2004) in his study of a broader phenomenon of dishonesty and deception in contemporary life, where “‘truth’ was replaced by ‘believability’” (2004, p. 5). However, the post-truth era was more enthusiastically revisited by academics in the run-up to the 2016 US election and Brexit (see Higgins, 2016; Suiter, 2016; Kucharski, 2016; Gross, 2017), and its inclusion as 2016 “word of the year” in Oxford Dictionaries cemented its presence in public discourse. While a detailed public administration-oriented treatment of the post-truth era remains wanting, various other disciplines have already begun to apply their respective tools and perspectives towards understanding their situation in a post-truth context, and examples of this include epistemology (Higgins, 2016), pedagogy (Peters, 2017), medicine (Brown, 2016), biology (Gross, 2017), public health policy (Speed and Mannion, 2017), philosophy (Tallis, 2016), and epidemiology (Kucharski, 2016). Higgins (2016) describes post-Truth attitudes through an epistemological lens, as a form of epistemic relativism taken to the extreme and without the requisite underlying intellectual integrity. She alludes to the redundancy of the public manager the post-truth era in saying that “repetition of talking points passes for political discussion, and serious interest in issues and options is treated as the idiosyncrasy of wonks [emphasis added]” (2016, p. 9). Speed and Mannion highlight the particular vulnerability of public health policy (the domain studied in this chapter) to post-truth attacks, cautioning that the post-truth era and populism “have profound implications for the health of populations and the

112 Challenges in public value creation design and implementation of national (and international) health policies” (2017, p. 250). The causes of the post-truth era are seen to be manifold (see Keyes, 2004; Suiter, 2016; Peters, 2017). Speed and Mannion succinctly present the causes as subsumed by two drivers: a cultural backlash and an economic malaise (2017). Peters summarizes it as “a coincidence of older neo-conservative values, antiimmigration sentiments, and white working-class people, especially men, who […] got left behind” (2017, p. 564). Suiter describes the causation thus: “arguably, what we are witnessing is a toxic combination of policy blunders on austerity, war and globalization coupled with a new hybrid media and political system dominated by reality TV, social media and filter bubbles” (2016, p. 25). Economic disenfranchisement (Suiter, 2016; Higgins, 2016; Brown, 2016) and agitation about social transformation (Tallis, 2016; Suiter, 2016; Vernon, 2017) are also recognized as important drivers. Meanwhile, the consequences of the post-truth era are also beginning to be explored in a variety of domains. For example, looking at the plight of health policy but also making a more generalizable observation about expertise, Speed and Mannion note that “it is not difficult to see that the disdain for policy experts by politicians pursuing populist policies, may result in poorly designed and implemented […] policies with potentially serious dysfunctional consequences” (2017, p. 250; see also Vernon, 2017). However, putting the decline of factual discourse in perspective, Brown presents the argument that “in the first place, the place of expertise and evidence in recent events was limited – too small a part of the picture to conclude that people have rejected them” (2016, p. 2) and that experts have not sufficiently engaged with the public in the past, since “facts can be close to useless if you don’t engage with context and lived experiences, whether to challenge them or to appreciate them, or both.” This is echoed by Tallis in the observation that there is a current resorting “to the kind of ‘fact-shaming’ that is the negative corollary of the equally futile presentation of facts in the hope that reason prevails” (2016, p.10). Although public value theorists have yet not directly engaged the posttruth era, many thinkers foretold the dangers that could and would be posed to public managers in more hazardous circumstances. Benington identified a “well-informed ‘public’ with the consciousness and the capability to engage actively in this kind of democratic dialogue” as a requirement for public value creation (2009, p. 232). Moore himself remarked on the vulnerabilities of politicians to “many different kinds of corruption” that would “affect the moral claims of political decision-making” (1995, pp. 54– 5). He later also noted that “while the political system often says that it wants accountability, and occasionally demands it, it is usually reluctant to negotiate a stable deal about what constitutes public value” (Moore, 2007, p. 99). The post-truth is a manifestation of a longstanding concern in public value that we must “give more recognition to the legitimacy of a wide range of stakeholders,” without which the public’s disenfranchisement would worsen (Stoker, 2006, p. 47).

Public value and the post-truth era 113 Indeed, the questions of “how to rebuild trust within communities which are disunited, divided and demoralized,” and of “how to develop confidence, trust, and loyalty between the people and the public authorities,” did loom in the background of public value’s discourse (Benington, 2009, p. 244). Benington correctly points out that the “powerful influence of civil society upon the state” has been increasingly remarked upon following “popular mass movements for democratization in Eastern Europe, South Africa and Latin America” (2009, p. 241), but now even the United States is trudging along that same path. Benington further observed the social undercurrent in regretting that “the public realm is under current challenge from tendencies which undermine the sense of inter-dependence within a multi-cultural society – for example, racism, sexism, fascism, fundamentalism, brutalization and consumerism, which fragment the notion of what we have in common as a public” (2009, p. 235). Public value scholars long recognized the need for dialogue between stakeholders and political decision-makers, and discussed how this could be jeopardized (see Alford and O’Flynn, 2009; Stoker, 2006; Benington, 2009; Spano, 2009). Williams and Shearer presented public value’s thesis about the role of the public manager quite aptly in arguing that “the public value framework provides an affirmation of managerial ingenuity and expertise, albeit within a binding democratic order and a finite resource base. The manager’s purpose is envisaged as going beyond policy implementation to the more proactive exercising of creativity and entrepreneurialism” (2011, p. 1370). But Wanna and Rhodes warned that reprisals against public managers could occur and “get nasty, bite them back, leave them exposed” (2007, p. 414). Wallis and Gregory discussed the blame-shifting aspect of the public value debate as characteristic of risk-aversion among politicians and public managers (2009). Benington warned of “an alternative form of legitimation for the actions and the interventions of the state given the erosion of confidence in elected representative government” (2009, p. 245). Perhaps most pertinently to the post-truth era, Meynhardt insisted that public value theory “needs to tackle issues of the interaction between ‘facts’ and the evaluation of those facts” (2009, p. 211). Finally, Moore himself noted that public managers would be victims of “imperfect political agreements” (1995, pp. 54–55). A limitation of the post-truth literature, given its incipient nature, is that few case studies have been produced that would delve into the details of experience or of practice for the various agents who must respond to the realities of the post-truth world. Furthermore, much of the recent academic discussion on the post-truth era presents itself in the form of editorials or commentaries (see examples in Brown, 2016; Brown, 2016; Tallis, 2016; Gross, 2017; Peters, 2017; Gewin, 2017). As such, they serve more as vociferations for communities of scholars more so than as investigative works, let alone engaging in case-study oriented enquiry. This chapter aims to take the post-truth literature beyond vociferation, and particularly so in a public administration context.

114 Challenges in public value creation Expertise is bête noire of the post-truth era. As Higgins notes “now ‘don’t bother me with facts’ is no longer a punchline. It has become a political stance” (2016, p. 9). Gross queries that “if rational arguments and proven facts cannot compete against demagoguery and scapegoating, how can we establish evidence-based policies?” (2017, p. 1). Furthermore, for the public manager, as for all experts, a problem lies in the inability to effectively refute fake news sound bites in part due to the mechanism of delivery. As Peters notes, “post-truth politics [is] based mainly on appeals to emotion without any detailed policy specifics, delivered through video and social media, especially Twitter, that are not ideal media for argumentation, disputation, reflection and fact-checking” (2017, p. 565). Therefore, the public manager would prima facie appear to be in a moribund state in the post-truth era, certainly insofar as an earlier chapter on illiberal democracies argued. However, this chapter presents a case study that may leave room for more optimistic interpretations of the post-truth public manager, as an agent that creates public value through her reassertion of impartial expertise and professional rigor.

The Congressional Budget Office and the American Health Care Act The Congressional Budget Office (CBO) is an independent budget office attached to Congress with a mandate to produce fiscal analysis of a rigorous and nonpartisan nature. It has a long track record of engaging in nonpartisan economic analysis of national-level healthcare proposals (Joyce, 2011), and has proactively analyzed both successful proposals such as the Affordable Care Act (ACA, “Obamacare”) and unsuccessful ones including the Clinton-era healthcare reform proposal (Chohan and Jacobs, 2017; Chohan, 2017). Healthcare has been one of the main issues in American federal spending for more than two generations, and this is attributable to several factors. First, healthcare spending represents a significant portion of American federal spending (CBO, 2017b). Second, the United States is rare among “developed” countries in the extent to which it fails to provide healthcare coverage for a large swathe of the population (CBO, 2017b). Third, the two American political parties have very different – almost diametrically opposed – attitudes towards healthcare spending (Warshaw and Broockman, 2017). Fourth, American healthcare is particularly vulnerable to post-truth politics, and informed policy is necessary to protect public healthcare from “the theatrical machismo of vainglorious populist leaders,” because such politicians “have profound implications for the health of populations and the design and implementation of national (and international) health policies” (Speed and Mannion, 2017, p. 250). Chohan and Jacobs (2017; see also Chohan, 2017) carefully delineated how cooperation between the Obama executive branch and the CBO led to a successful implementation of the ACA (“Obamacare”). This was achieved through a process of sharing various plans, and using the CBO’s assumptions, to create a

Public value and the post-truth era 115 less fiscally burdensome means of improving healthcare coverage. This did have significant positive effects for segments of the American population, and Speed and Mannion note that a repeal of the Affordable Care Act would have very real consequences in terms of public welfare (2017, p. 250). The strong cooperation during the Obama era between politicians and public managers to pass the ACA represents a high-water mark for public value creation as well as for effective legislative budget offices (Chohan and Jacobs, 2017). In the post-truth era, following the 2016 election and the Trump-Republican victory, the ACA became a prime target for the new government, which sought to dismantle and repeal Obamacare. Various reasons have been posited for the fervor that underlined the movement towards dismantling a pillar of American healthcare coverage, including political animosity, right-wing ideology, and special interest groups (see various discussions in Thompson et al., 2018; Nadash et al., 2018; Noh and Krane, 2018; Béland et al., 2018; Garlick, 2018; Wilensky, 2017; Gaffney and McCormick, 2017; Fiedler et al., 2017). The Trump administration and Congress sought to replace the ACA with the American Health Care Act (AHCA) in the Republican-dominated House and the Better Care Reconciliation Act (BCRA) in the Senate. However, American public values regarding healthcare reform in opinion polls showed extremely negative views and opposition towards the Republican House (AHCA) and Senate (BCRA) bills, (Warshaw and Broockman, 2017). For the AHCA, two bills were introduced by Republicans into the House Energy and Commerce Committee and the House Ways and Means Committee on March 8, 2017. They both passed their committees the following day, on a party-line vote and without any report or analysis by the public managers at the CBO. The lack of expert CBO scrutiny of these highly controversial and substantive bills drew ire and criticism from politicians in the opposition Democrat party, as when the House Minority Leader Pelosi contended that the AHCA bill should not proceed until the CBO had conducted a proper analysis of the proposals (Lawder, 2017). This contestation is reminiscent of the previous healthcare proposals under presidents Clinton and Obama, wherein the CBO expertise “provided cover” for accountability by the legislative branch (see Chohan and Jacobs, 2017; Chohan, 2017). Furthermore, the ranking Democratic member of the House Ways and Means Committee, Representative Richard Neal, categorically stated that “to consider a bill of this magnitude without a CBO score is not only puzzling and concerning, but also irresponsible” (Neal, 2017). Previous analyses of independent budget offices and public value creation (see Chohan, 2018a, 2018b, 2018c) have shown that the existing government fiscal machinery and independent budgetary institutions can mutually improve the quality of budget transparency by keeping one another “honest” (see also Chohan, 2017). This had been emblematic of the relationship between the Office of Management and Budget (OMB) and the CBO since the 1980s (Joyce, 2011; Chohan, 2017), which succeeded in fostering a standard of public finance budgeting at the federal level in the United States.

116 Challenges in public value creation However, American post-truth political culture (see Inglehart and Norris, 2016; Thompson et al., 2018; Garlick, 2018) seeped through the White House and into appointments made to departments such as the OMB, such that Trump administration officials, including OMB director Mick Mulvaney and economic advisor Gary Cohn, pre-emptively attacked the legitimacy of the CBO and the questioned its public value contribution (Thompson et al., 2018; Garlick, 2018). For example, Cohn lambasted the CBO and said that its score would be “meaningless” (Lawder, 2017). Much recent work on public value creation by independent budget offices (see review in Chohan, 2017) has shown that the larger budget offices including the American CBO have gained a high degree of legitimacy, and this has enabled a fuller public value creation process to be instated in the overall budgetary architecture. By that account, the post-truth era has marked a significant step backwards for public managers, as such criticism from the White House against the CBO would have been seen as unusual, since prior administrations from both political parties had not questioned the CBO’s credibility for decades, and its impartial and rigorous analysis was part and parcel of American political life (see Joyce, 2011). Such remarks would corroborate the concern articulated at the beginning of this chapter that public managers would be under threat in a post-truth world. However, it is at this juncture that the CBO, as a professional and nonpartisan institution of public managers, began to reassert its legitimacy in a posttruth context. While Republican politicians continued to dissimulate the potential public value destruction of their proposed plan, the Congressional Budget Office analyzed the budgetary impact of the AHCA through its “scorekeeping” public value function (see scorekeeping in Chohan and Jacobs, 2017; Joyce, 2011). The factors it sought to scrutinize included the health insurance coverage impact, the annual budget deficit impact, the cost of insurance, and the quality of insurance (CBO, 2017a, 2017b,). In other words, the CBO was deploying budgetary tools to analyse the impact of healthcare policies on the value being created (or destroyed) for the public. According to each of the CBO’s scores, the passage of the Republican AHCA and BRCA would result in “a dramatic reduction in the number of persons with health insurance, relative to current law” (CBO, 2017a, 2017b, 2017d) – which is to say, it would result in substantial public value destruction. Their precise figures were that persons with healthcare insurance coverage would be reduced by 14 million in 2018, 21 million in 2020, and 24 million in 2026 relative to current law (CBO, 2017e). The causes of this decrease were also explained by the CBO. In 2018, much of the reduction would be attributable to eliminated penalties for the individual mandate, both directly and indirectly. In later years, reductions in insurance coverage would be attributable to lower Medicaid enrolment, the elimination of the individual mandate penalty, subsidy reductions, and higher costs for groups of the public (CBO, 2017a, 2017b, 2017d). Forecasting out ten years (2026 estimates), the CBO warned that an estimated

Public value and the post-truth era 117 49 million people would be uninsured under the Senate BCRA, versus 28 million under current law (CBO, 2017a). Every year, one in 830 uninsured Americans die in a way that could have been prevented with better health care (Gaffney and McCormick, 2017). The Congressional Budget Office indicated that an extra 16 million people would be left uninsured and that this would leading to 19,277 preventable deaths (CBO, 2017b). Other uninsured people would risk the onset of painful chronic conditions and even permanent disabilities that could have been prevented with health insurance. This amounted to public value destruction through large losses of human life, which is arguably the ultimate category in measuring destruction of value. Yet the Republican party and President Trump continued a post-truth attempt to justify their damaging healthcare proposals (Thompson et al., 2018; Garlick, 2018; Wilensky, 2017; Gaffney and McCormick, 2017; Fiedler et al., 2017). Tweets from the president, speeches from congressmen, and townhall meetings between Republican representatives and ordinary voters all repeated the same message: that the new healthcare proposals were better for America than Obamacare had been (Nadash et al., 2018; Noh and Krane, 2018; Béland et al., 2018; Garlick, 2018; Fiedler et al., 2017). Aside from the public value destruction caused by uninsuring large swathes of the public, the CBO also assessed the impact of each of its scores on the American budget deficit (CBO, 2017b). Its forecasts and scores suggested that there would only be a “moderate” reduction in the deficit relative to current law (CBO, 2017a, 2017d). The public value created would be concentrated within certain groups, as for example in that taxes on the roughly top 5% of income-earners under current law would considerably drop. In other words, public value destruction would also occur due to worsening inequality (see also Gaffney and McCormick, 2017). The CBO’s various costings of the AHCA suggested that the deficit would be reduced by roughly $300–350 billion USD over ten years. The Republican party hailed this as a great success for their plan, but this belied the small scale of this deficit reduction. To see the deficit in perspective, the CBO had estimated that the U.S. would add approximately $9.4 trillion to the debt total over the 2018–2027 period, based on laws in place as of January 2017 (CBO, 2017a, 2017d), and so a $321 billion deficit reduction only amounted to roughly 3.5% of the total debt increase over the decade (Gaffney and McCormick, 2017; Fiedler et al., 2017). On July 12, the CBO’s Director Keith Hall met with Representative Tom MacArthur to discuss questions the Congressman had raised regarding CBO’s processes for “ensuring the integrity of its work” and about the agency’s analysis of the effects of the AHCA, pointing out in detail “the steps the agency takes to ensure its work is objective, impartial, and nonpartisan” (2017c). The CBO’s analysis raised several concerns about public value creation under the AHCA (2017a, 2017b, 2017d). First, the analysis pointed out that portions of the public, particularly older members, would be excessively discriminated against, once the community rating provision would be removed, as this had been preventing insurance companies from charging older people more than three

118 Challenges in public value creation times what they charge younger people. Second, they raised the budgetary problem of adverse selection, since healthy young people would drop out from the insurance market. Third, the analysis pointed to the aforementioned low impact on the deficit. Finally, they raised concerns about public value destruction when the loss of healthcare for poorer Americans would occur under a phaseout of Medicaid. Despite these concerns, post-truth politicians from the Republican party continued to push the bill in Congress. The CBO analysis on the AHCA had two forms of public value impact, one on politicians and the other on citizens, as seen in Figure 7.1. The CBO’s public managers had a two-fold public value impact on politicians and citizens, inspiring both to mobilize against the AHCA’s potential for public value destruction. The first form of impact was on politicians hailing from both the Republican and Democratic parties. In House committees, Democratic representatives used CBO numbers along with several strategies to amend the bill, such that the ultimate list of amendments exceeded 100, and there were even some amendments brought forth that had been used by Republicans against Obamacare, such as requiring that the bill be posted online for 72 hours before any votes were taken on it, and that every member put a statement in the Congressional Record stating he or she had read the bill, therein urging explicit ex-ante accountability (Thompson et al., 2018; Nadash et al., 2018; Noh and Krane, 2018; Béland et al., 2018; Garlick, 2018; Wilensky, 2017; Gaffney and McCormick, 2017; Fiedler et al., 2017). All of these amendments were rejected by the Republicans, and the Republican majority repeatedly upheld these rulings. In public value terms, the

Figure 7.1 The twofold impact of post-truth public managers Source: The CBO’s public managers had a two-fold public value impact on politicians and citizens, inspiring both to mobilize against the AHCA’s potential for public value destruction.

Public value and the post-truth era 119 Republican congressmen were failing to grasp of “a public rather than the summation of individual aspirations” (Moore, 2014, p. 469). However, the CBO analysis had the effect of creating greater political dissent against the AHCA within Republican ranks, which had until then been continually voting along party lines. This is a CBO public value contribution of “providing cover” as theorized by Chohan and Jacobs (2017). Of some ironic quality, there was even Republican dissent based on the notion that the AHCA was not aggressive enough at destroying Obamacare, particularly from the ultraconservative House Freedom Caucus, which noted that essential health benefits were not being removed (Nadash et al., 2018; Noh and Krane, 2018). The second form of impact was on citizens themselves. Stoker has remarked that for public value there needs to “be a shift from a culture that accepts public acquiescence in decision making to one that expects active citizen endorsement” (2006, p. 47). A great flurry of post-truth pro-AHCA campaigning was attempted both within the Republican party and in engagements with Republican voters, but the public was very much averse to the idea of the AHCA, and at the crux of their revulsion was a number, widely disseminated by social media and mainstream media across the political spectrum: 20 million Americans would lose their healthcare (Garlick 2018; CBO, 2017a). This number, arrived at through nonpartisan analytical rigor at the CBO, stuck in the minds of American citizens, irrespective of the post-truth “bubble” they may have belonged to. Benington foresaw such public value tensions in stating that “more active participation by individual citizens, neighborhood groups, and voluntary associations will result in more vocal challenge to government policies and programmes” (2009, p. 241). In fact, the public was mobilized to fight the Republican congress in two specific ways: general protest and congressional reprobation. In townhall meetings with Republican congressional representatives, ordinary citizens could be seen voicing, often emotionally, their intense personal grievances against the possibility of losing their insurance (Béland et al., 2018). They articulated personal hardships to these politicians, and in doing so told them clearly what their values were. They were applying what Samaratunge and Wijewardena call the “persuasive power” because of a shift in their values towards, and expectations of, service delivery (2009, p.319). General protests were also covered by the mainstream media, highlighting the plight of ordinary Americans who would go through unnecessary hardship or agony without healthcare support. As such, in their place as a third actor in public value creation, citizens strongly articulated their values by disapproving of the Republican healthcare agenda (see also Warshaw and Broockman, 2017). The culmination of the two-front response to the CBO analysis was that politicians (Democrat and dissenting Republicans) as well as civil society (in organized groups and otherwise) fought to pressurize the executive and legislative branches to stay their hand on the AHCA (Béland et al., 2018; Gaffney and McCormick, 2017). Nevertheless, it was on the seven-year anniversary of the ACA’s (Obamacare’s) signing into law that the vote for the AHCA was scheduled (Fiedler et al., 2017). By that time, the

120 Challenges in public value creation Congressional Republican leadership was very much struggling to get a sufficient number of votes for the bill, thereby forcing a reschedule of the vote, as requested by the White House (Nadash et al., 2018; Noh and Krane, 2018). Meetings between majority leader Paul Ryan and President Donald Trump resulted in, according to Paul Ryan, a decision to withdraw the bill (Pear et al., 2017). The American public would thus “be living with Obamacare for the foreseeable future,” according to Ryan (Pear et al., 2017); while Trump said that it was tough to pass the bill without support from Democrats. In the meantime, both Ryan and Trump said that the Republicans would move forward on other policy issues (Pear et al., 2017; Nadash et al., 2018; Noh and Krane, 2018). What was the role of the CBO in this healthcare debate? Using the advisorycostings framework (Chohan and Jacobs, 2017), which was previously used to diagnose the public value effectiveness of the CBO, it is possible to revisit the question of the “role” played by the budget office in the post-truth context. The CBO scores full marks as both an advisory and costings institution with respect to the AHCA. Its analysis laid the basis for a forceful political debate, and for thwarting Republican efforts to engage in public value destruction through the de-insuring of 20 million Americans. Evidently, the CBO’s score as both an advisory and as a costings institution is outstanding. The CBO can be seen to score full marks on both accounts given the public value creation in which it engaged, as it helped to foster transparency, impartiality, analytical rigor, citizen engagement, and political mobilization. The CBO keenly assessed the budgeting assumptions, challenged the underlying biases of the Republican-dominated Congress, and reframed the fiscal discourse surrounding American healthcare reform. It also allowed for dissenting Republicans to articulate their concerns, as they noted how the AHCA would lead to “a dramatic reduction in the number of persons with health insurance, relative to current law” (CBO, 2017a, 2017b, 2017c). It further laid out policy options along with alternative approaches and their constraints, while its reports helped the Democrats introduce 100 different amendments, even though these were rejected by Republican stalwarts. Equally significantly, the CBO’s figure of 20 million was a rallying cry for politicians and citizens against the AHCA. As such, the CBO played a powerful advisory role in public value creation. At the same time, the CBO also fulfilled an effective costings role. It used its analytical wherewithal to crunch the complex numbers behind the AHCA in terms of the health insurance coverage impact, the annual budget deficit impact, the cost of insurance, and the quality of insurance. It then proceeded to lay out the impacts of the AHCA over a ten-year horizon, including the various projected outcomes from implementing different versions of the AHCA. Finally, the CBO scoring of the AHCA was crucial to the entire healthcare debate, and led to a two-pronged response from politicians and citizen groups. Therefore, despite the post-truth posturing of the Trump administration, and efforts by members of the administration to discredit an institution of

Table 7.1 Ingredients for an advisory role and a costings role in public value (CBO) (1) Normative – advisory role

Congressional Budget Office

Yes: The CBO keenly assessed the budgeting assumptions, challenged the underlying biases of the Republican-dominated Congress, and reframed the fiscal discourse surrounding American healthcare reform. 2 Providing cover: The CBO allows Yes: The CBO allowed for dissenting politicians to disaggregate the merits of Republicans to articulate their concerns, as policy from issues of political loyalty. they noted how the AHCA would lead to “a dramatic reduction in the number of persons with health insurance, relative to current law.” 3 Providing options: Providing politi- Yes: The CBO examined several versions cians with multiple ways to proceed, not of the proposed AHCA and laid out policy options along with alternative approaches just passively costing what is given to and their constraints. them. Yes: The CBO report helped the Demo4 Fostering negotiation: Foster a crats introduce a 100 different amendments, negotiation process between even though these were rejected by [institutions]. Republican stalwarts. Yes: The CBO’s figure of 20 million was a 5 Raising public awareness: Advise rallying cry for politicians and citizens on ex-ante and ex-post oversight that against the AHCA. increases public awareness of [fiscal problems]. 6 Encouraging discipline: encouraYes: The CBO continued its emphasis on ging executive budget makers to exerbudget sustainability, and highlighted the cise better analytical discipline. meagre impact that the AHCA would have on the overall deficit over the next ten years. Advisory score: 6/6 (2) Mechanistic – costings role Congressional Budget Office Yes: The CBO used its analytical where1 Number crunching: Be the withal to crunch the complex numbers “number cruncher in chief” and cost (produce figures for) policies brought to behind the AHCA in terms of the health insurance coverage impact, the annual the IFI. budget deficit impact, the cost of insurance, and the quality of insurance. 2 Forecasting: Provide projections of Yes: the CBO laid out the impacts of the budget figures over long-term horizons. AHCA over a ten-year horizon, including the various projected outcomes from implementing different versions of the AHCA. Yes: the scoring of the AHCA was crucial 3 Scorekeeping: note the changes in budget figures due to changes in policy to the entire healthcare debate, and led to a two-pronged response from politicians and measures. citizen groups. Costings score: 3/3 1 Questioning: The CBO questions the budgeting assumptions, challenges the underlying biases, and reframes the budget discourse.

Source: CBO, 2017a, 2017b, 2017c, 2017d; author research.

122 Challenges in public value creation public managers, the CBO played both an effective advisory role and a costings role in a context where post-truth politics risked causing significant public value destruction. However, to corroborate the assertion of effective public managers in a post-truth context, it also helps to situate the CBO’s work on the AHCA in terms of the central symbol of public value theory: the strategic triangle. Moore’s triangle posits three criteria: (1) creation of substantive public value; (2) legitimacy and support; and (3) operational capabilities (1995; 2004). As Moore notes, the triangle is both a tool for making calculations about strategy as well as used as a framework for measuring performance against that strategy (2008). The post-truth travails of the CBO are considered in light of this framework in Table 7.2. Applying the strategic triangle to the case of the CBO and the AHCA corroborates the assertion that the CBO successfully legitimized itself in the posttruth era through its effective and nonpartisan analysis that inspired politicians and civil society to challenge the AHCA. Whereas the operational resources of the CBO were not put in jeopardy at any stage, there was a degree of pushback against the CBO’s legitimacy and the recognition of its public value role. Those were surmounted due to a much larger show of public support, and through the CBO’s analytically rigorous and highly influential budget reports. The strategic triangle and the advisory-costings framework both point to what may Table 7.2 The strategic triangle and the post-truth CBO Criteria

CBO

Recognition of Yes value

Legitimacy and Yes support

Operational capabilities

Yes

Total

3/3

Although there was an attempt by Republican White House officials, the OMB, and some members of Congress to disregard the value of the CBO, there was a far larger group of institutions and actors which recognized the importance of the CBO as an independent institution of public managers. This included dissenting Republicans, Democrat politicians, public manager institutions, and citizen groups. The legitimacy of the CBO, premised on decades of effective, nonpartisan, and substantive fiscal analysis was reinforced in the AHCA debate, even as agents of post-truth populism tried to reject or ignore the importance of the CBO. If anything, worry about the loss of healthcare coverage for tens of millions of Americans bolstered the CBO’s legitimacy as a sound and authoritative voice in a controversial post-truth context. The CBO also sought to inform politicians about its analytical approach and its standards of practice so as to further secure its legitimacy in the face of political doubters. The operational capabilities of the CBO, including analytical staff such as healthcare economists, budget specialists, fiscal analysts, were not reduced or hampered.

Source: Moore (1995); author research.

Public value and the post-truth era 123 be called the re-legitimization of the public manager in the post-truth era. That is to say, in an era where the legitimacy of the public manager as “expert” might have been seen as a lost cause, the post-truth era in fact may offer an opportunity for the public manager to reassert her role in public value creation. This in turn suggests that public value creation through effective public managers is still entirely possible in the post-truth world, and so the discourse of public value remains a very salient one.

The salience of public value in a post-truth world The CBO’s successful participation in the AHCA debate shows that the posttruth era may offer a moment for the reassertion of the public manager’s legitimacy and her centrality to the processes of public value creation. However, this is only possible if the public manager demonstrates leadership both in terms of initiative and in terms of channelling a “value-seeking imagination” (Moore, 1995, p. 22), as the CBO has amply demonstrated vis-à-vis the AHCA. It requires a redoubling of the effort to persuade politicians and the public about why her work is important to society, as public value scholars have insisted (see Meynhardt, 2009, p. 214). It also requires more deft management of the adversarial pressures that characterize the “politics-administration dichotomy” (Roberts, 1995). This speaks to what Williams and Shearer expected of public value as “an affirmation of managerial ingenuity and expertise, albeit within a binding democratic order and a finite resource base” (2011, p. 1372). In informing the American public about the damages that the AHCA would have wrought, and seeing citizen groups and politicians mobilize against its promulgation, the CBO succeeded in what Lowndes et al. call the “renewal of citizen consent” (2006, p. 552); and what Benington and Turbitt term the “coalition of sufficient support” to generate legitimacy in the eyes of the public (2007, p. 383). The CBO emulated what Benington describes as “part of the role of government to take the lead in shaping and responding to people’s ideas and experiences of the public, of who we are, and what we collectively value […] and what adds to public value and what detracts from it” (2009, p. 253). Samaratunge and Wijewardena noted that “Citizens are no longer the passive beings willing to accept everything spelt out to them by their political representatives,” and their resistance to the AHCA, and the subsequent surrender of the Republicans, amply demonstrates this observation (2009, p. 316). This notwithstanding, there is still a lingering tension between the politicians and the public managers (the “politics-administration dichotomy” as Roberts put it, 1995) that is exacerbated in a post-truth context. In one sense, the posttruth world is an extreme version of a longstanding concern in public value that we must “give more recognition to the legitimacy of a wide range of stakeholders” (Stoker, 2006, p. 47), and that there is a multiplicity of hybrid definitions (van der Waal and van Hout, 2009) of just what the truth is (or rather, “what the truths are”). Stoker notes that “the emphasis in public value is

124 Challenges in public value creation on challenge and change” (2006, p. 49), and yet the post-truth era is one of heightened challenge and arguably undesirable changes. Meynhardt (2009, p. 193) portrays the public value scheme as a broader question about “impact on how people think and feel about society,” but this does not truly capture the condition in which there is broad disenfranchisement of citizens to the degree that they come to detest society itself. All of these concerns are listed here because, even as they emerge from within the public value discourse, they are too disfigured in a post-truth context to hold the same meanings as they may once have thought to convey. It is useful to revisit a distinction that Roberts placed between public managers as “moderators of discussion” and “players in the political game” (1995, p. 293). The post-truth era is characterized by the diversion of politics towards acrimonious divisions that are not founded on factual discourse, and towards politicians “lying without condemnation” (Higgins, 2016, p. 9), which lends itself well to an inspection of the primacy that public value has accorded to politicians, particularly given the heightened demagoguery and antagonistic rhetorical stratagems of post-truth politicians. Perhaps most pertinently to the post-truth era, Meynhardt insisted that public value theory “needs to tackle issues of the interaction between ‘facts’ and the evaluation of those facts” (2009, p. 211), while Moore himself noted that public managers would be victims of “imperfect political agreements” (1995, pp. 54–55). The question therefore arises: should politicians be granted the same preeminence in public value creation that they were before the post-truth era? Moore once opined that, “in the end none of the concepts of ‘politically neutral competence’, ‘policy analysis’ and ‘program evaluation’, or ‘customer service’ can finally banish politics from its pre-eminent place in defining what is valuable to produce in the public sector. Politics remains the final arbiter of public value, just as private consumption decisions remain the final arbiter of private value” (1995, p. 38). And yet, Higgins remarks that “the irony is that politicians who benefit from post-truth tendencies rely on truth, too, but not because they adhere to it. They depend on most people’s good-natured tendency to trust that others are telling the truth, at least the vast majority of the time” (2016, p. 9) So what must public managers do in the post-truth era? We might ask of public managers what Higgins suggests for scientists, that “they should publicly affirm the intellectual virtues that they so effectively model: critical thinking, sustained inquiry and revision of beliefs on the basis of evidence” (2016, p. 9). Indeed, there is a need for the public manager to re-assert her value to society, and to heed Suiter’s assessment that “the bedrock of the post-truth environment [is that] truth is simply a matter of assertion” (2016, p. 27). As Speed and Mannion remark, “it is a pressing necessity that health policies in liberal democracies continue to offer a breadth of coverage that ensures parity of access, based on the rigorous application of research evidence, underpinned by robust processes of democratic engagement” (2017, p. 251).

Public value and the post-truth era 125 However, Brown forcefully argues that “it is wrong to conclude that the public doesn’t care for truth” (Brown, 2016, p. 1), and that “evidence, expertise, truthfulness, facts, knowledge… these are public goods.” Engagement by public managers is important, since “insofar as experts and evidence have played a role in [significant policy] debates, it has looked like an alternative to engaging with people” (Brown, 2016, p. 2), and it is worth remembering that “in the first place, the place of expertise and evidence in recent events was limited – too small a part of the picture to conclude that people have rejected them” (2016, p. 1). As with the example of the CBO, Brown notes that the fight is not over, and that the danger of accepting post-truth characterization is that we abandon this empowering side of the evidence movement just as it’s winning through. Evidence and expertise have too often looked like counsel to the knowing, rather than what we could be making them: the means by which the less powerful can call the world to account. (Brown, 2016, p. 2)

Conclusion: the re-legitimization of public managers Public value theory “needs to tackle issues of the interaction between ‘facts’ and the evaluation of those facts” (Meynhardt, 2009, p. 211). However, expertise is the bête noire of the post-truth era, and this would imply that the public manager’s role and position should be gravely imperilled and vulnerable to the belligerence of politicians as well as the roused public. Nonetheless, as this chapter shows, the post-truth era has a more nuanced character that poses both challenges and opportunities for public managers. In particular, it offers a moment for the reassertion of the public manager’s legitimacy and her centrality to the processes of public value creation. This is only possible if the public manager demonstrates leadership both in terms of initiative and in terms of channelling a value-seeking imagination. It requires a redoubling of the effort to convince politicians and the public of the importance of her work to society, and it also requires a defter management of the adversarial pressures that characterize the politics–administration dichotomy. This is made even more evident when noting that the post-truth era is a period of intensified value destruction, due to its intolerant, emotive, non-factual, and rhetorical nature. But the difficulties of the post-truth era are also magnified by the contradictory, sometimes conflicting, values as they are articulated by the public. The contradictions in what the public really values become more visible, and more confounding, both to the public manager and to the public itself. The post-truth politician is an abettor to this phenomenon, for in the search for greater electoral success, she seizes upon the disavowal of nonpartisan expertise and the repudiation of analytical rigor. This raises the question of whether politicians really should be the “final arbiters” of public value in the post-truth era.

126 Challenges in public value creation The case of the CBO and the AHCA shows that it is possible for public managers to reassert their legitimacy through impartial analysis and professionalism, even in the face of heightened antagonism from a segment of politicians and a segment of the public. The CBO presented a rigorous analysis of the dismal public value destruction that politicians attempting to repeal and replace the Affordable Care Act would wreak. This led to a movement of resistance both from the public, who engaged in renewed activism against the proposal, and from politicians on both sides of the aisle, who mustered a resistance to the AHCA and saw it fail to get passed at every turn (Pear et al., 2017). This speaks to what Benington identified as a “well-informed ‘public’ with the consciousness and the capability to engage actively in this kind of democratic dialogue” (2009, p. 232). Chapter 5 on illiberal democracies seemed to sound the death knell for public managers, arguing that they would face severe and possibly terminal risks. However, the CBO shows that the public manager’s role in the process of public value creation is more important than ever. This agrees with Chohan’s foreshadowing that “the evidence-based approach of the CBO is not just a luxury but a necessity in what is being described as a post-truth world” (2017, p. 6). As such, this chapter presents evidence of a contrasting and far more hopeful possibility for the public manager. Public value’s precepts, even as they were devised in an earlier era, resound today in the antagonistic setting of the post-truth era with heightened relevance. In other words, even though the post-truth era presents a unique set of grave challenges for the public managers, the CBO provides an ample demonstration of public value creation, as well as of the pertinence of both public value theory and of the public managers themselves, in a post-truth world.

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8

Conclusion

The aim of this concluding chapter is to tie together the findings of the book’s earlier discussions across various chapters, along with identifying limitations to the research and avenues of future public value enquiry, so as to argue that the objectives of the book help to advance the dialogue in the public administration literature. Towards that end, it helps to revisit the perspective of this book at its preliminary juncture, and restate the situation described of public value theory at the introduction. Public value had been lauded as “a comprehensive approach to thinking about public management and about continuous improvement in public services” (Constable et al., 2008, p. 9), and as “the next big thing in public management” (Talbot, 2009, p. 167). It was in essence a lens to explore how people “think and feel about society” (Meynhardt, 2009, p. 193), and its founder argued that public managers should be “orchestrating the processes of public policy development, often in partnership with other actors and stakeholders” (Benington and Moore, 2010, p. 4). The original thinking around public value sought “to help imbue public sector managers with a greater appreciation of the constraints and responsibilities within which they work” (Williams and Shearer, 2011, p. 1367). It had been remarked that public value is a contribution to storytelling, an analysis of outcomes, a management practice, a tool to make operational improvements, a means of reducing the democratic deficit, a mix of outcomes and outputs, and an aspect of a relationship but not an objective fact (Prebble, 2016, p. 103). Benington had argued that public value can be seen in two ways: first, what the public values; and second, what adds value to the public sphere (2009, p. 233). Indeed, public value has always been characterized by a multiplicity of hybrid definitions (van der Waal and van Hout, 2009). At the same time, “there remains some lack of clarity over what public value is, both as a theory and as a descriptor of specific public actions and programmes” (Williams and Shearer, 2011, p. 1367). Furthermore, “the public value framework does not derive from a particular research tradition and there is, as yet, little by way of empirical research to support the claims made for it” (Williams and Shearer, 2011, p. 1381), and that “further clarification, specification and consensus over concepts and terminology” are still necessary

130 Conclusion (Morrell, 2009). As I had then commented, the literature seemed to be in consensus about the fact that there is yet no consensus on just what public values are. Public value remained an “umbrella concept” that is “still being typologized” (Alford and O’Flynn, 2009, p. 187), which is why it needed to be “rescued from ambiguity” (Prebble, 2012, p. 392). As Williams and Shearer remark, “the public value doctrine has been supplemented by newer interpretations and applications and, in the process, commentators (not least Moore himself) have reworked the themes and concepts involved” (2011, p. 1367). That is in part because it was a theory designed more so for practitioners than for scholars (Prebble, 2016). Indeed, “public value emerges as an approach that is rooted in everyday practice and retains a non-didactic flexibility of application,” but at the same time “the risk is that public value fails to develop a secure empirical foundation and loses clarity and distinctiveness as an approach to practice” (Williams and Shearer, 2011, p. 1374). To grapple with all this ambiguity, at the very outset of this book I sought to define public value as follows: Public value is a discourse regarding the role of public managers in cocreating value through partnerships with other social agents including politicians and civil society, so as to serve a wider public through the deployment of society’s resources: budgetary and non-budgetary; within national boundaries and beyond; in developed and developing countries; in the face of contradictions in values held by citizens; as well as in the face of adversity posed by other agents in society. I had acknowledged the seemingly long-winded nature of this definition, but I stressed that only by such a definition could we begin to encompass the avenues of enquiry that would be specifically addressed in this book. Some of those avenues were to be explored for the very first time in the public value literature. The need to provide an early definition, I insisted, was made all the more evident by the various criticisms lodged against public value, particularly within academia, and for a variety of reasons (Prebble, 2012, 2016; Oakley et al., 2006; Alford and O’Flynn, 2009; Williams and Shearer, 2011). Even those academics who were not necessarily critical of public value theory pointed to definitional problems and philosophical shortcomings within the theory that require examination and elaboration (Talbot, 2006, 2009; Prebble, 2012, 2016).

A threefold approach With the definition laid out, I emphasized the ambition of this book as consisting of three important and interrelated objectives. These could be summarized as: (1) to advance the public value literature across new international contexts, (2) to develop the notion of symbiosis between the lens of budgeting and public value theory, (3) to identify certain emergent challenges to public value creation.

Conclusion

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New contexts In the first instance, the book sought to extend public value to new contexts outside those for which it was originally conceived, namely liberal, Western, “developed” countries (Prebble, 2016; Oakley et al., 2006). Such extensions into new contexts included developing countries (South Africa), post-Communist societies (Russia), supranational entities (the European Union), bilateral relations (China-Pakistan), and illiberal democracies (Hungary and Venezuela). In the South African examination on developing countries (Chapter 2), it was found that not only could public value be effectively adopted as a relevant discourse, but it could also help to explain the reasons whereby, in certain cases, developing countries could even exceed the value creation of “developed” countries. This was demonstrated by measuring the high budget transparency rankings of South Africa according to the Open Budget Index (IBP, 2015b), which showed that South Africa surpassed nearly every OECD country in terms of budget transparency. It was found that the superior engagement of civil society in the budget process, along with other institutional measures, allowed South Africa to score near the very top of the international rankings despite the challenges that it had faced since the end of apartheid. This helped address what public administration scholars correctly bemoaned to be an underrepresentation of developing-country contexts in public value research (see Samaratunge and Pillay, 2011; Samaratunge and Wijewardena, 2009). In the Russian examination on post-Communist societies (Chapter 4), the purpose of developing a case study was to ask whether countries that had not experienced the liberal, Western, democratic trends in the 20th century but were now attempting to transition towards such models couldn’t also contribute to the public value discourse, and even use its precepts to explain their experiences and challenges. The findings of the chapter were that, not only could comparisons be drawn in terms of value creation through budget transparency between postCommunist societies and older liberal democracies, but a few decades of reforms and institutional transformations had allowed post-Communist societies to begin to exceed the progress on budget transparency compared to some of the older liberal democracies. However, this is not so much the triumph of post-Communist countries as a realization that all country groups must make further progress on turning their budgetary architectures into more transparent and accountable systems. This chapter helped to advance the notion that public value is a more generalizable and more universally applicable theory, given that it could extend into contexts that were once more authoritarian, planned, and illiberal. The question of illiberal democracies extended that inquiry in the reverse direction, for as most post-Communist countries had been trying to move towards more liberal systems, the illiberal democracies were veering in the opposite direction. Hungary was a particularly interesting case in that it experienced both of these leanings in less than a generation. In that chapter (Chapter 5), the cases of Hungary and Venezuela suggested that public managers would face challenges in illiberal systems, as their respective fiscal councils

132 Conclusion were not only challenged and jeopardized continuously, but were ultimately disbanded. However, since the public value literature, whose emergence was roughly contemporaneous with that of illiberal democracies, had not explicitly touched upon the theme of illiberal systems, a chapter was dedicated to explore such political systems. This illiberal exploration was then taken a step further to the post-truth era, where a contrasting result was found in terms of the verdict on public manager legitimacy, finding that post-truth systems may present obstacles for public managers, but they also provide an opportunity for the reassertion of public managers’ legitimacy. This too was a new area of exploration in public value theory, and a particularly salient one given its considerable recent popularity in Western discourses. As with the contrasting results for the chapters on illiberal democracies and the post-truth era, there were equally contrasting findings for two other chapters that explored new frontiers in public value: (1) the supranational entity, and (2) bilateral public value creation. The supranational chapter (Chapter 3) on the European Union offered a series of propositions that emanated from the inherent tensions (1) between public managers at the supranational vs. national levels, and (2) between public managers and politicians at the national level. Using the lens of the European Fiscal Board, a supranational fiscal watchdog, the findings of the chapter were that there were considerable limitations to the value creation exercise when public managers were deployed onto a supranational agglomeration of publics, and also that the lack of trust in supranational public managers (the “Eurocrats”) was fueling illiberalism and populism. By contrast, the chapter on bilateral public value creation (Chapter 6) used the China-Pakistan Economic Corridor as its lens to assert that public value between nations was possible in part because such initiatives were dealt with by publics that were largely left intact, and with separate public administrations and political systems mobilizing resources and a value-seeking imagination to co-create value due to the convergence of values shared by their respective publics. The contrasting results suggested that public value is possible between nations, but that there are different ways to go about it. On the one hand, the case of the EU illustrated that value creation by a common public administration might create less value than desired; on the other hand, distinct public administrations (China, Pakistan) may create more value than anticipated. Taken together, these new contexts represented, in my judgement, a set of highly useful extensions of public value dialogues beyond those to which it had typically been relegated over the past two decades. In that sense, it was a source of delight for me to find that testing for the universality of public value theory did indeed prove a fruitful engagement – and that this was achieved through contrasting analyses which enriched the public value debate by offering different perspectives. Budgeting as a public value lens The second objective of the book was to develop the notion of a symbiosis between public value theory and budgeting. Each chapter addressed this

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through various budgetary tools, and examples included: a citizen’s budget for civil society; cross-country budget transparency scores for post-Communist vs. non-Communist countries; case studies on LBOs in illiberal democracies (which did not survive); long-term economic plans for bilateral stimulus programs; and costings analysis prepared by independent LBOs. Each of these examples reinforced the claim made at the very outset of this book about a particularly useful and informative relationship between budgetary studies and public value theory. As Franklin, Krane, and Ebdon have elegantly surmised: “budgeting is the linchpin between popular sovereignty and public action. As such, budgeting is the fundamental decision-making process where citizen preferences are translated into governing choices” (2013, p. 123). The budget is a “function of central importance in any polity” (White, 1982, p. 76), and the insight of compatibility between budgeting lenses and public value had been tacitly remarked upon in works that had previously deployed budgeting approaches in public value (see Chohan and Jacobs, 2017, 2018). They framed it in terms of observations such as the “natural dialogue” between politicians and public managers in the budgeting exercise of value creation (Chohan and Jacobs, 2017, p. 1063), or as a form of “legitimization by numbers” coupled with “a pro-active dialogue about ‘why our work is valuable to society’” (Meynhardt, 2009, p. 214), or even as “adding value to the public realm by stimulating and supporting democratic dialogue and active public participation and citizen engagement” (Benington, 2009, p. 237). To illustrate why budgeting lenses were so à propos, I drew an analogy between the budget process and public value theory, as reproduced in Figure 8.1. The presentation of this analogy helped to cement what I saw as parallel processes within the same field of agents: public managers, politicians, and citizens. These agents constituted the process of allocating society’s resources through a budget, and they were also the co-creators of public value. An echo of this analogy could be found in Moore’s early writings which declared that public value should be “a framework that helps us connect what we believe is valuable and requires public resources [emphasis added], with improved ways of understanding what our ‘publics’ value and how we connect to them” (Moore, 1995). Budgeting is an inherently political enterprise that requires the executive machinery of public managers in order to (ideally) serve the needs of citizens. The analogy here lay in the co-creation of public value with the very same agents: public managers (executors, value-seekers), politicians (final arbiters), and civil society (collective customer). The dominant lenses in this book involved (1) case studies of LBOs, (2) indices of the International Budget Partnership (IBP), and (3) budgetary documentation from national and supranational entities. In this book, the LBOs for which case studies were deployed included those of: the United States, to assess the “re-legitimization” of the public manager in the post-truth era; Hungary and Venezuela, as outcomes for public managers in “illiberal democracies;” and the European Union, to gauge the difficulties in fiscal policy decisions for a

134 Conclusion Politicians budgetary legislation, oversight, appropriation, representation, debate and approval

Public managers execute budget functions and budgetary programs

Politicians final arbiters of public value

Public managers execute value-creating programs with a value-seeking imagination

THE BUDGET PROCESS

PUBLIC VALUE THEORY

Citizens Receive the outputs of the budget process through resource allocation choices

Citizens articulate their values and represent the colletive customer of value-creation

Figure 8.1 The analogous representations of the budget process and public value theory Source: Author research.

“supranational public.” Meanwhile, national-level documentation helped structure thinking about the expectations pertaining to, and functions conferred upon, public managers in the pursuit of public value. Some examples included: the Citizen’s Budget of South Africa (the “People’s Guide”), to examine the question of public value and citizen participation; and the Long-Term Plan for the China-Pakistan Economic Corridor, which helped examine public value between nations. Furthermore, data from the International Budget Partnership (IBP) was used for cross-country comparisons of budget transparency (and of public value creation) between different groups, as for example in the comparison of post-Communist societies and Western European countries; or in looking at relative budget transparency of countries within the EU; as well as in measuring the state of budget transparency in developing countries (South Africa). This was in part a response to criticisms of the lack of empirical investigation in public value research. As Williams and Shearer commented, “the public value framework does not derive from a particular research tradition and there is, as yet, little by way of empirical research to support the claims made for it” (2011, p. 1381); and they added that “the risk is that public value fails to develop a secure empirical foundation and loses clarity and distinctiveness as an approach to practice” (2011, p. 1374). I had noted that a large thematic focus within the assortment of budgetary tools deployed in this book was on budget transparency and accountability. Budget transparency refers to the ease with which important information about the budget is made available to a wider assembly of stakeholders; and so not just to political decision-makers, but also to the public at large (IBP, 2015a, 2015c). Budgetary accountability refers to the ability to make authorities responsible for their fiscal choices and fiscal actions (Chohan, 2018). Both “transparency” (see Douglas and Meijer, 2016) and “accountability” (Wallis and Gregory, 2009) have been shown to be important conditions for the creation of public value given that, on one hand, they allow for greater democratic participation and input in the distribution of society’s resources (Stapenhurst and Pelizzo, 2002);

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and on the other hand, they allow for better (fairer) outcomes to result in society as an output (Wehner and Renzio, 2013). Since a budget is a reflection of how resources are allocated within society budgetary transparency and accountability help to align public managers and politicians with those values that citizens most desire. Grappling with public value challenges The third objective of this book was to identify certain emergent challenges to public value creation, which may be a product of the very recent past. Examples included the difficulties faced by public managers in (1) the post-truth era, (2) the illiberal democracy, (3) the supranational entity, and (4) value creation across national boundaries. The illiberal democracy and the post-truth era both pose difficulties for the public manager, but this book presented opposing arguments about the impact on the public manager in confronting these challenges. On one hand, the illiberal democracy’s case studies of Hungary and Venezuela suggested that the plight of public managers may be dire as politicians reduce their authorizing environment. On the other hand, the post-truth era does offer an opportunity for the public manager to reassert her legitimacy, so long as she channels a value-seeking imagination and leverages her operational capabilities towards effective public value creation. Such are the ways that difficulties faced by contemporary public managers can also be perceived as opportunities, which is an important part of the practitioner education that public managers can gain in their study of public value. Similarly, the challenge of creating value beyond discrete national boundaries was raised in this book through two chapters. Chapter 3 considered value creation at the supranational level, taking the case of the European Fiscal Board to argue that there were fundamental difficulties in supranational public value emanating from tensions between (1) the supranational vs. national public managers, and (2) politicians and public managers at the national level. This suggested that the difficulties of value creation would be an order of magnitude greater once a supranational entity was formed. On the other hand, Chapter 6 looked at value creation between nations that largely left their publics intact, as with the China-Pakistan Economic Corridor. While this enterprise too may be fraught with risks, the chapter considered the articulation of shared values and the mobilization of separate public administrations to address those values, without trying to forge a larger public as the EU has. The examination of public value between nations is important because it is more reflective of the 21st-century reality whereby value creation is a much more internationalized and globalized affair (Moore and Donahue, 2012). The aforementioned issues reflect the pressing need for public managers to adapt to the difficulties that contemporary society confronts. To have these issues receive some treatment in this book therefore affirms the third objective of this book, but also paves the way for much future public value research along these very lines.

136 Conclusion

The wider world of value creation In examining questions about the nature of “the public,” “value,” and “public value” in a truly international context involving many different countries as case studies, I intended for this book to take an ambitious look at public value with fresh eyes across a wider horizon. Throughout the book I emphasized the fact that there were various unstated assumptions about public value that must be explored in explicit detail. To put it in the language of public value, there was a need for “concrete managerial settings” (Meynhardt, 2009, p. 214) where challenges to public value could be examined, which use compelling case studies to both “structure thinking” about what ought to be the case as well as to “diagnose the existing situation” (2009, p. 174). Put another way, there are emergent challenges to public value creation that warranted exploration so that they could “help imbue public sector managers with a greater appreciation of the constraints and responsibilities within which they work” (Williams and Shearer, 2011, p. 1367). With that in mind, I sought for the ambition of the book to be international, and therefore developed case studies on the budgetary institutions in many different country cases across five continents: North America, South America, Europe, Africa, and Asia. As I remarked in the introduction, a global worldview would help achieve two things. First, it fed the examination of public value theory in new and foreign contexts, which spoke to the aforementioned test for the universality of public value. Second, it allowed for comparisons between the different budgeting experiences around the world, underscoring both the similarities in the challenges faced, as well as the differences in approaches taken by countries in facing adversities. While the book does have subjacent thematic elements that combine its chapters, such as illiberal political tendencies or value creation between countries, each of these chapters is also a standalone work in its own right. As such, I suggest that practitioners interested in a particular budgeting case study, or academics interested in a specific issue within the broader public value discourse, may choose to refer to particular chapters that address their specific interests. Taken together, however, I insist that the chapters help build a construct of connectivity between budgeting and public value theory, and can be read sequentially by readers interested in a fuller picture of the international budgeting experiences as they inform public value. A comprehensive look at public value theory’s frontiers through the lens of budgeting, as conducted in this book, was thereby presented in Table 8.1 (see also the introductory chapter).

Reciprocity, limitations, and future research In academic research, the conduits of learning are often reciprocal: a lens may be deployed to address a question in the academic literature, but ideally the enquiry within that literature also informs our understanding of the lens itself.

Title

Questions

Supra-national entities and defining the “public” in public value

Public value in postCommunist societies

3

4

What does it mean to be the “public” in a supranational, globalized world? Is the relationship of public managers and politicians in public value creation at the supranational level in conflict with those at the national level? Can public value be applied to non-Western liberal democracy contexts, such as post-Communism? How has post-Communist public value creation fared?

1 Introduction Part One: Extending public value to new contexts 2 Public value and the What is the role of citizens citizen in public value and why is civil society given less attention than public managers and politicians? Is public value applicable to developing countries in the same way as developed countries?

#

South Africa

European Union member states

Russia, Former Warsaw Pact countries

The European Fiscal Board

International Budget Partnership’s Budget Transparency Scores for postCommunist countries and OECD countries

Countries

Citizens’ Budget of South Africa

Budget lens

Table 8.1 Systematically approaching public value questions through a budgetary lens

Public value can indeed be transposed onto post-communist societies but with qualifications due to a different history. Today, post-Communist countries are creating public value in degrees sometimes comparable to the traditional Western European democracies

Citizens are co-creators in public value and their role must be strengthened through better inputs (information) and engagement. Public value creation can be applied to developing countries, and sustained efforts can make value creation here even greater than that in developed countries Supranational Identities challenge existing notions of democracy and create a dimension of conflict between value creation by (1) bureaucrats at national vs. supranational levels and (2) politicians and bureaucrats at the national level

Analysis/Results

Title

Questions

Public value and the post-truth era

Conclusion

7

8

Source: Author research.

Public value between nations

6

Congressional Budget Office (CBO) and American Healthcare Act (AHCA)

The legitimacy of “experts” including bureaucrats is severely undermined in the post-truth era, so are bureaucrats redundant and does this repudiate public value’s basic assumptions of legitimacy?

United States

China and Pakistan

Long-term Plan for the China-Pakistan Economic Corridor (2017–2030)

How do the agents of two nations (politicians, bureaucrats, civil society) engage in public value creation?

Countries Hungary and Venezuela

Budget lens Defunct budget offices of Hungary and Venezuela

Part Two: Challenges in public value creation 5 Public value and the What happens to public value creation when liberal “illiberal” democracies become democracy “illiberal”

#

Table8.1 (Cont.)

Shutdowns of budget offices show that the illiberal democracy curtails accountability, efficiency, and public value creation Politicians, bureaucrats, and civil society can all articulate “shared” values, and their commitment to create value through a wider negotiation process. A simultaneous negotiation process for the operating environment occurs at the intranational and international levels. The post-truth era poses a significant challenge, but does not eliminate the need for expertise. In fact, post-truth dynamics allow for the public manager to reassert her expertise and seize the initiative in public value creation.

Analysis/Results

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Previous works linking budgeting with public value produced such reciprocity (see Chohan and Jacobs, 2017, 2018), as when the study of “public value in politics” helped to identify the “roles” that independent budget offices can adorn, which became known as the advisory-costings framework (Chohan and Jacobs, 2017). It pleases me to say that such reciprocity also emerged at various junctures within the explorations of this book. Various examples of such reciprocation occurred throughout the passages of this book, and a few examples can be succinctly revisited here. First, it was in Chapter 6 on bilateral public value creation (China-Pakistan) that the strategic triangle was deployed to enumerate various shortcomings of public value creation in Pakistan, which represented the application of Moore’s triangle (1995) to a national context (i.e. to the nation itself), a heretofore unexamined possibility of the framework. Second, the example of the CBO’s advisory-costings role in the Republican healthcare debacle (Chapter 7) confirmed earlier research (Chohan and Jacobs, 2017) which suggested that the roles of LBOs can be delineated as advisory or as costings, and both create value for the public in different ways. Third, the use of the advisory-costings framework in the case of the European Fiscal Board (Chapter 3) showed that even an advisory-focused independent fiscal institution can detract or face limitations in terms of “public value in politics” and behave in an anti-democratic manner as Wanna and Rhodes alleged (2007), thereby bringing the very framework that refuted Wanna and Rhodes at the national level to now corroborate their suspicion about public value as a challenge to “responsible government” (2007, p. 406). That said, given the ambitious threefold objectives of the book, there are several limitations that must be conceded on my part as author, in the spirit of self-critical appraisal on how far this book has come and yet fallen short. The first limitation that must be conceded is that a comprehensive and thorough treatment of public value and budgeting would not have been possible in one volume alone, and this book should thus be seen as but a small stairway to what is an area of research with far greater opportunities for enquiry. A second limitation is that, despite stressing in this book what other scholars identified to be a lack of empirical rigor in public value (Williams and Shearer, 2011, p. 1381; Morrell, 2009), this book goes only so far in advancing the empirical aspect of public value. Chapter 3 on supranational entities, for example, suggested a series of propositions emanating from the logic of structuring public administration in two layers of national and supranational entities. Similarly, Chapter 6 on bilateral public value creation drew upon the ambition of value creation between China and Pakistan, rather than by extracting insights from their existing bilateral initiatives. As such, future work can do much more to address the empirical advancement of public value. Aside from empirical development, there was a somewhat low degree of numerical and quantitative treatment of public value questions in the book. While there may be nothing inherently limiting in qualitative exploration, public value has historically veered towards the qualitative, and future research may be enriched

140 Conclusion through more quantitative explorations of value creation, particularly when it is the lens of budgeting, a substantially quantitative exercise, that is used to understand value creation. A third limitation is that the book relies heavily on the traditional frameworks of public value, particularly the central symbol of the strategic triangle, rather than drawing on recent innovations in frameworks and analyses presented by new authors. There is much room for further developing that recent body of work. So where else can public value proceed from here? While this book successfully identifies important social phenomena that could be addressed through the public value discourse (such as illiberal democracy and the post-truth era), there is a great deal of potential in terms of future pathways to advancing public value. For the veins of research that pertain to specific chapters, recommendations have been made at the end of each chapter. For example, in Chapter 3 on the supranational public in the EU, I suggested that the larger five EU institutions (the European Commission, the European Central Bank, the Eurogroup, the Euro Summit and the European Parliament) may be better lenses to consider the propositions put forth on supranational public managers than the European Fiscal Board itself. Similarly, future research on public value in developing countries should deploy other lenses found in public administration, such as those relating to institutional culture, administrative practice, legal systems, or sociological influences, that may yield richer examples of the role that civil society can play in public value creation. Such examples are found across most chapters wherever specific to the themes explored; they are therefore omitted here for brevity. Taking a step back from the budgeting lenses employed in this book, I wish to suggest public value questions worth examining as part of a broader public administration enquiry. As technological breakthroughs continue to permeate into everyday life, public managers will have to wrestle with existential questions about administration in a digital age. On the one hand, this implies a reconfiguration of regulatory, oversight, research, and governance institutions that were instituted in the 20th century or earlier. On the other hand, the problem runs deeper, as public managers may be gradually replaced, if only to a degree, by decentralized autonomous organizations (DAOs) that are premised on code and digital contracts. The technological aspects of value creation, and how they revamp our understandings of efficiency, democracy, and accountability, is a rich vein of public administration research that is of significant longterm if not already of immediate consequence. Another enticing avenue of enquiry relates to the relationship between public value and private interest. The original three agents of public value are public managers, politicians, and civil society. Clearly, a gargantuan entity lurks in the background of neoliberal societies: private interest, which is often a determining, if not the determining, agent in many issues of social substance. Sometimes the relationship between public managers and private interests may be cordial or even symbiotic, but it may often be highly contentious or even

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antagonistic. Public value and private interest therefore represents an area of tremendous promise going forward. Building upon Chapter 2 on developing-country public value efforts, as well as on the well-founded criticisms of public value researchers (see Benington, 2009; Samaratunge and Wijawardena, 2009; Samaratunge and Pillay, 2011), it is important to insist upon richer, more committed, and bolder research into the nature of public value creation in the developing world. This book has helped advance that discussion by presenting the argument that, through explicit efforts to incorporate civil society and through the channeling of a value-seeking imagination, public value creation in developing countries can rival and on occasion even surpass that of “developed” countries. This is an encouraging indication, but it is also important to understand better why value creation is not attained to a satisfactory degree in many developing-country contexts, beyond the surface and cursory explanations of fewer resources or weaker institutions. In proceeding along that line of enquiry, public value may find immense synergies with literatures in other domains such as development economics, law, governance, and sociology. Several questions addressed within this book may be better answered without resorting to any budgetary lens at all. For example, the notion of the “public” within public value need not revert to supranational budgetary documents, but may turn to legal frameworks and institutional or structural approaches to study how the “public” is defined in modern societies, particularly in examining those groups that are marginalized in society. As one suggested example, it may help to look at the legal-institutional frameworks in countries experiencing large influxes of migrants, and deploying these to examine how new arrivals into the public are either allowed to co-create value or kept outside of the public sphere as it is understood. Such an example would help develop our understanding of the “public” to an extent that may be greater than what was attempted in this volume. An important observation in this book has been that the public value discourse need not be confined to liberal democracies. In that sense, it is worthwhile according greater attention to the manners in which other international systems of public administration, which may be radically different from liberal democracies, both in theory and praxis, may engage in value creating activities. Of particular interest – and insufficiently explored but nonetheless alluded to in this volume – are (1) the public administrations of post-colonial emergingmarket societies, such as Pakistan, as they wrestle with historical legacies and emergent public service challenges, and (2) the Chinese public administration, which has proven remarkable in its ability to engage in value creation processes for the world’s largest “singular public,” so to speak. Finally, there is a pressing need, in my judgement, to consider what I would term public value beyond public managers. The impetus behind public value’s development has been to inform a practitioner audience about their purpose in society. To go beyond practitioner engagement and to truly engage with the theory of public value requires looking at how value for the public is created

142 Conclusion beyond the agent of “public manager” as she is typically understood. This may involve examining institutions outside of the normal ambit of public manager categorization, including the judiciary, the army, the media, and multilateral institutions. I foresee substantial merit in taking public value in the direction of such agents, and thereby either reconsidering what “public manager” means, or more importantly, looking at value creation for the public in a more abstract form with a wider field of agents. Public value has come a long way, but despite the efforts presented in this volume, it still has a long way to go. Although the book has contended with the assertion that “neither advocates nor detractors are able to substantiate their claims with research” (Williams and Shearer, 2011, p. 1382), the contention that public value needs to be “rescued from ambiguity” (Prebble, 2012, p. 392) still stands and there is a need for “further clarification, specification and consensus over concepts and terminology” (Morrell, 2009). This book is a small part of that “rescue” effort. Public value is a discourse that is premised on creative, collaborative solutions and on a vibrant dialogue between stakeholders. In appraising the contribution of this book, I hope readers will be drawn to yet further enquiry into the public value realm and help to mobilize an important lens (budgeting) towards advancing the public value discourse. That, I believe, is a very fine way to create value for society.

References Alford, J., and O’Flynn, J. (2009). Making sense of public value: Concepts, critiques and emergent meanings. International Journal of Public Administration, 32(3/4), 171–191. Benington, J. (2009). Creating the public in order to create public value? International Journal of Public Administration, 32(3/4), 232–249. Benington, J., and Moore, M. (2010). Public Value: Theory and Practice. Basingstoke, UK: Palgrave MacMillan. Chohan, U. W., and Jacobs, K. (2017). Public value in politics: A legislative budget office approach. International Journal of Public Administration, 40(12), 1063–1073. Chohan, U. W., and Jacobs, K. (2018). Public value as rhetoric: A budgeting approach. International Journal of Public Administration, 41(15), 1217–1227. Constable, S., Passmore, E., and Coats, D. (2008). Public value and local accountability in the NHS. The Work Foundation, London. Douglas, S., and Meijer, A. (2016). Transparency and public value: Analyzing the transparency practices and value creation of public utilities. International Journal of Public Administration, 39(12), 940–951. Franklin, A. L., Krane, D., and Ebdon, C. (2013). Multilevel governance processes: Citizens and local budgeting: comparing Brazil, China, and the United States. International Review of Public Administration, 18(1), 121–144. International Budget Partnership (IBP) (2015a). Guide to the Open Budget Questionnaire: An explanation of the questions and response options. Retrieved from http://internationalbudget.org/wp-content/uploads/OBS2015-Questionnaire-a nd-Guidelines-English.pdf International Budget Partnership (IBP) (2015b). internationalbudget.org, Open Budget Survey Tracker [OBS Budget Data].

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International Budget Partnership (IBP) (2015c). internationalbudget.org, Open Budget Index. Meynhardt, T. (2009). Public value inside: What is public value creation? International Journal of Public Administration, 32(3/4), 192–219. Moore, M. (1995). Creating Public Value: Strategic Management in Government. Cambridge, MA: Harvard University Press. Moore, M., and Donahue, J. (2012). Ports in a Storm: Public Management in a Turbulent World. Cambridge, MA: Harvard University. Morrell, K. (2009). Governance and the public good. Public Administration, 87(3), 538–556. Oakley, K., Naylor, R., and Lee, D. (2006). Giving Them What They Want: Constructing the ‘Public’ in Public Value. London: BOP Consulting. Prebble, M. (2012). Public value and the ideal state: Rescuing public value from ambiguity. Australian Journal of Political Administration, 71(4), 392–402. Prebble, M. (2016). Is “we” singular? The nature of public value. American Review of Public Administration, 48(2), 103–118. Samaratunge, R., and Pillay, S. (2011). Governance in developing countries: Sri Lanka and South Africa compared. International Journal of Public Administration, 34(6), 389–398. Samaratunge, R., and Wijewardena, N. (2009). The changing nature of public value in developing countries. International Journal of Public Administration, 32(3/4), 313–327. Stapenhurst, F., and Pelizzo, R. (2002). A bigger role for legislatures. Finance and Development, 39, 46–48. Talbot, C. (2006). Paradoxes and prospects of “public value”. Paper presented at the Tenth International Research Symposium on Public Management, Glasgow. Talbot, C. (2009). Public value: The next “big thing” in public management? International Journal of Public Administration, 32(3/4), 167–170. van der Waal, Z., and van Hout, E. T. (2009). Is public value pluralism paramount? The intrinsic multiplicity and hybridity of public values. International Journal of Public Administration Review, 32(3/4), 220–231. Wallis, J., and Gregory, R. (2009). Leadership, accountability and public value: Resolving a problem in “new governance”? International Journal of Public Administration, 32 (3/4), 250–273. Wanna, J., and Rhodes, R. (2007). The limits to public value, or rescuing responsible government from the Platonic gardens. Australian Journal of Public Administration, 66(4), 406–421. Wehner, J., and Renzio, P. de (2013). Citizens, legislators, and executive disclosure: The political determinants of fiscal transparency. World Development, 41, 96–108. White, S. (1982). The Supreme Soviet and budgetary politics in the USSR. British Journal of Political Science, 12(1), 75–94. Williams, I., and Shearer, H. (2011). Appraising public value: Past, present and futures. Public Administration, 89(4), 1367–1384.

Index

accountability: in assessment 105–106; in the budget 10–11, 72; for citizens 83; ex-ante 118; in illiberal democracies 86–89; in supranational entities 50–51; as trust 29, 64–65 adverse selection 118 advisory-costings framework 41–42, 54, 64, 84, 122, 139 Affordable Care Act 110, 114–115, 126 American Health Care Act 114–115, 120 audit office 69, 71 Australian Journal of Public Administration 2 Batho Pele Document 29–30 Better Care Reconciliation Act 115, 117 bilateralization 97 Brexit 52 Budget and Expenditure Monitoring Forum 32 Canada 84 Charter of Budget Honesty 30 Chavez, Hugo 84 China: cooperation with Pakistan see China-Pakistan Economic Corridor; economic growth see One Belt One Road; public administration 98, 141; values 99–101 China-Pakistan Economic Corridor: planning see Long-Term Plan for the China-Pakistan Economic Corridor; as structure 102–103; as value for the public 104; citizens budget: as tool for governance 25–27; criticism 28; in South Africa 29–35

civil society: as actor in public value 22–26; in developing countries 34–37; in the United States 119–120 civil liberties 79 Cohn, Gary 116 Collaborative Africa Budget Reform Initiative 31 Communism 61–65; budgeting 68–69; see also Post-Communism Congressional Budget Office: deficit analysis 120–121; Healthcare costings 114–122; Scorekeeping 116 delegitimization 4, 52, 80, 88–90; of Congressional Budget Office 116 Eurocrats: in incentivization 44–48; in regional imbalances 48–49; in loss of trust 50–52 Eurogroup 56 European Commission 56, 58 European Central Bank 50–51 European Fiscal Board 53–58 European Summit 56 European Union 40–41, 43–45, 48–51; Anti-EU sentiment 52–53 Eurozone 48 Fidesz 86–87, 90 Fiscal Compact 53 fiscal council: in European Union 47, 54; in Hungary 86–88 Fukuyama, Francis 82 Globalization 95, 98 Global Financial Crisis 53, 86 Global Initiative for Fiscal Transparency 31

Index 145 Habermas, Jurgen 43 Healthcare: in United States reform 110–118; Medicaid 116, 118 Hungary 86–92 Illiberal Democracy: in public value challenges 88–93; in theory 82–84; see also Hungary; Venezuela Integrated Governance 21, 24 InterAmerican Development Bank 84–85, 91 International Budget Partnership: as transparency tool 10; for post-communist countries 70–72; for developing countries 22, 32–34, 36; Independent Fiscal Institution 9; in Europe 40, 53; in illiberal democracies 79–80, 86–93 International Journal of Public Administration 2 Iqbal, Ehsan 103 Legislative Budget Office: see Congressional Budget Office, Independent Fiscal Institution Long-Term Plan for the China-Pakistan Economic Corridor 101–105 Maastricht Treaty 53 Maduro, Nicolas 90 Manuel, Trevor 30 market economy 68, 98 Moore, Mark: on civil society 24–25; as founder 1–4; on frameworks 133; on the public 44; see also strategic triangle Mulvaney, Mick 116 Neoliberalism 1 Networked Community Governance 21, 24 Obamacare see healthcare OECD 33, 70–72 Office of Management and Budget 115–116, 122 Oficina de Asesoría Económico y Financiera de la Asamblea Nacional 80, 83–86, 88, 90–92 One Belt One Road 96, 98–99, 106 Open Budget Index 8, 19; see also International Budget Partnership Open Government Partnership 31 Orban, Victor: 83, 86–87, 91, see also Fidesz

Pakistan: 101–105; see also China-Pakistan Economic Corridor People’s Guide to the Budget: see citizens budget politics-administration dichotomy 110, 123, 125 populism: for public value 79, 83, 89; in Europe 51–52, 54, 56; in United States 111, 122; see also illiberal democracy post-communism: assumptions 61–62; budgeting 68–72; comparison with liberalism 63–66; limitations 62–63 post-truth era: 109–113, 123–126 private sector: in Pakistan 102; in Russia 69; in South Africa 31–32; in theory 2, 4, 61–62, 140 Public Administration Review 2 Public Finance Management Act 30 Republican Party 115–123 resource-rich developing country 84 Rodriguez, Francisco 84–85, 90 Russia: budget code 69; budget institutions 68; transition from communism 69–70; see also post-communism Ryan, Paul 120 Silk Road 95, 96, 105 South Africa 29–34 Soviet-bloc see Warsaw Pact Stability and Growth Pact 53 strategic triangle: European Fiscal Board 56; Venezuelan 91; Hungarian 91; Pakistani 102; US budget office 122 surplus recycling mechanism 48–49 taxation 68 transparency: between institutions 115; in developing countries 23, 29; in post-communist countries 66–72; as tool 8–10; as value 10; see also International Budget Partnership Treaty on Stability, Coordination and Governance in the Economic and Monetary Union 53 Trump, Donald 83, 117, 120 US Congress 114; in the House Energy and Commerce Committee 115; in the House Freedom Caucus 119; in the House Ways and Means Committee 115; see also Republican Party

146 Index US State Department 85 Varoufakis, Yanis 48; see also surplus recycling mechanism Venezuela 83–85, 90–92; see also Oficina de Asesoría Económico y Financiera de la Asamblea Nacional

Warsaw Pact 62, 72 White House 116, 120 Xiaoping, Deng 100 Zakaria, Fareed 82