Academic journal article Public Administration Quarterly

Twenty-First Century Budget Reform: Performance, Entrepreneurial, and Competitive Budgeting

Academic journal article Public Administration Quarterly

Twenty-First Century Budget Reform: Performance, Entrepreneurial, and Competitive Budgeting

Article excerpt


This article looks at the possible public budget evolution that will take place as a result of the changes brought into place by the information revolution. The authors argue that a fundamental historical change is occurring and that budgeting as a practice is adapting to that change. They first examine progressive reform movement and the forms of public budgeting so common in government today, They then look at the futurist literature to describe the remarkable changes brought to society due to the information age. From that literature the authors argue that a new form of budgeting is starting to emerge. If they are correct, then we are entering into a new era with important implications for public budgeting. Although many positive results may occur with these new budget reforms, there are some negative realities that might also provide serious headaches for tomorrow's leadership. The authors conclude by examining those implications.


This article speculates on the likely budget reforms that will be successful in the next century and the problems that will be associated with those reforms.l The first part of the article presents the last major set of budget reforms that flowed out of the Progressive and Liberal Eras and its impact on how budgeting is predominantly done today. The second part discusses some negative implications of this new type of budget reform. The article concludes with a few observations.


Ideas guide behavior when they are shared by a number of people. They can even place value on people, things, and activities including the public budgeting process (Lynch, 1995:15). An example of this statement can be found at the turn of the twentieth century with the influence of the Progressive Movement. This set of beliefs came to define the American notion of modern society with its strong central role for government in society and its stress on an executive with strong command and control direction. Under Progressivism and later American Liberalism, government regulates the private sector and is directly involved in the nation's social, economic, and environmental realities. These realities include child labor, factory safety, food safety, drug regulation, political corruption, and economic monopolies (Brier, 1992:5). Starting at the beginning of the twentieth century, Progressivism called for government, especially the federal government, to take an activist role in society. This included being a guarantor of national economic stabilization, safety, defense, and the health of the people.

The turn of this century saw remarkable changes in American society largely as a reaction to the Gilded Age. Cities grew at breakneck speed as people flooded from rural areas to the cities often to work in factories. Waves of immigration provided cheap labor for factories that were largely made possible by the assembly line and the mass production of goods. The nation changed from an agrarian country to a nation dominated by city dwellers. "The Gilded Age and industrial capitalism had reached into every corner of the nation's life" (Brier, 1992:61).

Social Darwinism of the time put forth the so-called scientific explanation that the human conditions were due to the unfit character of the masses. The political majority of the nineteenth century felt that any interference by government in favor of the weak and poor only protected the unfit and would doom American society to a less evolved state. The Progressives disagreed with Social Darwinism and argued that the new industrial order denigrated the human condition and were the victims of its misguided policies. Perhaps the humorist Mark Twain in his 1874 novel called the Gilded Age captured the money lusting materialism with the following words: "Get rich dishonestly if you can, honestly is you must" (Quoted in Brier, 1992:61).

The nineteenth century style of American government was largely inspired by Thomas Jefferson who believed in "the least government was the best government. …

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