HUD’s Inexperienced Bureaucrats

The Washington Post slammed Ben Carson’s Department of Housing and Urban Development today. The paper found that “loyalty eclipses expertise” in the upper ranks of the agency given that 24 of HUD’s 70 political appointees have little housing experience. Most of the 24 helped on either Trump’s or Carson’s presidential campaigns.

A few thoughts.

Washington is a revolving door of analysts and operatives moving back and forth between trade associations and businesses (when their team is out) and executive branch agencies (when their team is in). Arguably, Carson’s policy of bringing non-housing outsiders into HUD is consistent with Trump’s “drain the swamp” promise. After all, when industry insiders are appointed to federal jobs, their incentive is to steer subsidies and bend regulations toward their industry friends on the outside.

The Post argues that Obama’s HUD appointees were more expert than Trump’s. Maybe so, but as small government supporters in Washington know, a great policy asymmetry is that most of the experts on government welfare programs are the liberals and lobbyists who favor the expansive status quo. That is one reason why Washington is a self-sustaining and self-protecting ecosystem so difficult to cut.

All that said, in 2015 I also critiqued federal political appointees as amateurs who have a problematic incentive structure:

The federal executive branch is headed by an elected president who appoints about 3,000 people to top positions across the bureaucracy. Political leadership of federal agencies has some benefits, but it also causes failures. New administrations come into office eager to launch new initiatives, but they are less interested in managing what is already there. Political appointees think that they know all the answers, so they do not bother learning the lessons from past efforts, and they repeat mistakes. As each administration yanks agencies in new directions, past investments are thrown down the drain. The average tenure of federal political appointees is short—just two and half years—and so appointees tend to push superficially appealing initiatives that look good on their resumes, but they shy away from tackling longer-term, structural reforms. 

Another problem with appointees is that many of them are political partisans who lack management or technical experience. One of the reasons for the failed response to Hurricane Katrina in 2005 was that many executives in the Department of Homeland Security were inexperienced party loyalists. This lesson from Katrina has not been learned. Today, for example, many U.S. ambassadors are political donors with no experience in the countries they are posted. Another example is the current acting head of the 900-employee Federal Railroad Administration, who seems to have no background in railroads or transportation, or apparently any technical qualifications. The ticket to the top for this official appears to have been a decade of media relations jobs for members of Congress and the White House.

That is the executive branch. As for the legislative branch, inexperience is an even larger problem. Most members of Congress and their staffs have little knowledge of the complexities of the industries that they subsidize, penalize, and tax. The modern Congress is a bunch of lawyers squabbling over how to manipulate a $20 trillion economy that they do not understand.

The basic problem with the federal government is that it is too big. The problem with HUD is that officials in a faraway capital are trying to micromanage local communities, not that some HUD officials were former event managers and HVAC salesmen.

For more on executive branch failings, see this study.

For more on legislative branch failings, see this study.

For an overall analysis of federal failure, see this study.