The "market model" failure of governance and the case of Greece


  • Demetrios Argyriades Professor of Public Administration
  • Pan Suk Kim Professor of Public Administration


For close to three decades, large segments of humanity have been held hostage to a novel model of governance which claimed to liberate them from an invasive bureaucracy, regulation and "big government". In particular, it promised a government that "worked better and cost less". Peaking roughly in the days of the end of the Cold War, it also came with promises of prosperity and peace and this with minimal government. A few years down the road, we saw the famed "peace dividend" evaporate in tandem with prosperity, as the Great Recession struck, affecting North America, the Continent of Europe, as well as emerging economies. With escalating conflicts in Africa and West Asia, a new arms race developed with trillions of dollars diverted from needed peaceful pursuits to manufacturing weapons and mounting operations in several parts of the world. Although wars notwithstanding, the global UN community has been able to pursue the Millennium Development Goals (MDGs) set in the year 2000, and to address the challenges of poverty and malnutrition in several parts of the world, meeting the MDGs has principally been due to efforts in two countries, the giants India and China, which, hardly coincidentally, never really put their faith in the market model of governance (Kim, 2015). Not surprisingly, the issues that the model has failed to address are those requiring governance which looks to the long haul, promoting the general interest. As the latest Papal Encyclical (Pope Francis, 2015) has underscored, climate change is a complex of issues which must be addressed by governments acting in unison, in earnest and good faith.
Remarkably, the model won adherents the world over, in countries big and small, developed and developing and many occupational groups. It influenced politicians, economists and businessmen but also administrators, hence the New Public Management and, until very recently, was viewed as the way of the future. It won its adepts chiefly by deconstructing concepts which, since the Age of Lights, had underpinned reforms, those especially that shaped the Administrative State and the Public Service Profession. Erosion of the concepts of Public Service Professionalism and Public Administration, as a field of systematic study, opened the gates to nepotism, corruption and mismanagement, dispensing with the barriers that, since the 1870s, the merit system built. The model also served to explain and justify short-sighted opportunism as the "pragmatic" approach to coping with contingencies in the "real world out there". Greece is a case in point and it is paying the price for playing fast and loose with the institutions of governance. But Greece is hardly alone; critical mass adds value to what this paper argues. The message is none other than the need to restore professionalism in governance and public administration, as the needed coefficient of knowledge, high-level skills and ethos, in the service of the government and society at large.
Unlike New Public Management, which reduced it all to competency, we believe all the above three to be needed but arguably, of the three, ethos to be overarching. There can be little doubt that to "results over process", the idea in fact, that efficiency and effectiveness are all that count in governance, we owe the escalation of bribery and corruption, embezzlement, mismanagement and maladministration that the world has experienced during the past decades. Since the dawn of the 21st century, this tide has gained momentum from human and drug trafficking and the flourishing arms trade. Should we not rather call this model: The Market Model of Maladministration?