that government best which governs least. Its motto may be "Laissez faire." Its activity may be summed up briefly: "Do nothing." Under such conditions the whole question of social budget-making is in the hands of private individuals and private organizations and this situation need not detain us any further.

But in twentieth century, complex, industrial America, where government has broad social welfare ends. to serve, and where it must be militant, aggressive, progressive and positive, the budget procedure must be responsive to the social needs.

The representative system of government is peculiarly fitted to this kind of social organization because the machinery exists for registering directly through the representatives the multiple social needs. In this kind of society questions of public policy are continually presenting themselves, governmental organization is highly specialized, fluid and adaptable. Government ramifies into the lives of all the people in thousands of ways. There is continuous need for new projects, new and changed administrative organization. These must be financed through the budget. Without the funds to finance these new projects and to sustain old projects, government will break down, or through perversion government will create or aggravate social conditions which it is designed to prevent or allay. The budget procedure, whatever it is, must be sensitive to the multiple needs of a complex industrial social organization.

CHAPTER III

THE EXECUTIVE BUDGET

WHILE economy is most frequently urged as the reason for the adoption of a budget system, the particular form of a budget system that shall be adopted is tied up to another idea, namely, responsible government.1 The contemporary discussion takes practically for granted that there is an inevitable connection between what is called responsible government and the so-called executive budget. The reader of budget literature will find the words "executive budget " glaring at him from practically every paragraph. The words will be used in a variety of meanings and in a variety of contexts. It seems therefore of fundamental importance that there should be a clarification of the confused and various meanings of the "executive budget " and its frequently associated phrase, “responsible government."

1"The political necessity for the adoption of a budget procedure lies in the fact that it is the only effective means which has ever been devised for enforcing accountability and responsibility on an executive who has sufficient power to make him a leader, i. e., to make him effective in the preparation and submission of plans proposed for adoption and to enable him efficiently and economically to execute them after they have been approved and financed. The economic necessity for the adoption of a budget procedure lies in the fact that demands for service by the government are going to continue to increase and with this the necessity both for careful, intelligent planning by the management and a strict censorship on the part of those who pay the bills." ("Budget Making and the Increased Cost of Government," by F. A. Cleveland, Amer. Econ. Rev., Mar., 1916.)

While it may be necessary for us to examine in some detail the specific form of executive budgets as they have been presented to the American people, it will be well to consider in this chapter the theory undefiled by the compromises of practical politics. This will give the executive budget idea its best chance of acceptance.

It is important that the basis of the case for the executive budget should be clearly understood as those who advocate it understand it. And fortunately there is at hand condensed statements of the reason for it by Mr. Cleveland, the principal and the most intelligent expositor of the executive budget idea in the United States. He says summarily: "Public business that costs the country millions of dollars each year is conducted by an irresponsible bureaucracy, operating under the direction and control of irresponsible legislative committees. There can be only one result — irresponsible government." ("Constitutional Provision for a Budget," Frederick A. Cleveland, Reprinted from proceedings of Academy of Pol. Science, 1914.)

He says more fully:

"American institutions have had quite a different history. While the evolution of a technique of responsible management has been going on abroad, we have drifted along and done practically nothing to reconcile our charters of liberty to make them effective as charters of powers. Our early political acts, as in Europe, were directed toward the negation of executive authority. Our first acts were to destroy the executive. Then the federal congress recommended the organization of state governments with executive branches, thinking that all civil administration could be thus conducted. For fourteen years we tried to run the federal government with

no executive department, but without success. Then we adopted a system in which an executive was provided for, but left out of our written constitution all of the essentials of responsible and responsive leadership.1

"From the beginning our governments have been built on negative lines they have lacked the machinery for getting things done in a manner to command the respect and the support of the people. Our constitution makers have thought little about the adjustments necessary to make our fundamental law a charter of powers. Much attention was given to the two great instruments of popular control over the executive - the 'electorate' and representative body'— because these were thought to be necessary for the protection of our liberty. But in our institutional plans we failed to provide an effective 'prime mover,' and we have failed to recognize the uses of the 'electorate' and the 'representative' body as instruments of control over an institutional prime mover.

6

"The motive force in government, as well as in all other institutions, must be an executive. No matter what instruments of control over this motive force are provided, these cannot be effectively used unless they are applied to a prime mover.' The executive must not only have the power to get things done, but also must be required to exercise this power in the face of a possibility of prompt retirement in case his leadership is not supported.1 Neither a broad'electorate' nor a great representative body' can act effectively or intelligently unless it has before it a definite well-considered plan or policy; and the one best qualified to prepare such a plan is the executive. But the executive should have no power to act until his plan is approved, and he must know that every proposal submitted is open to closest scrutiny. Otherwise the government cannot be made responsive to the will of the people as expressed through representatives in expressing approval or disapproval.

"Instead of providing in our system for utilizing the 'electorate' and the 'representative body' as instruments

1 Italics ours.

of control (the only purpose to which they were adapted) and then developing an executive machinery subject to this control, which would be responsive to the will of the people, we began with an executive who had no power of leadership. And then, as demands for institutional service increased, we did violence to every principle of representative government we sought to develop the 'electorate' and the 'representative body' as prime movers - and to utilize the executive' primarily as an instrument of control. We have done this wittingly. We have done this because we distrusted the representative system- for fear the 'electorate' and the representative body' would fail to prove effective as instruments of control; and that the executive machine would run wild. We have done this in the thought that by making the executive a responsible leader we might possibly sacrifice those liberties for which our fathers fought - preferring to rely on written constitutional inhibition rather than on the representative system for control over a government of powers. We have succeeded in one thing only the one thing we started out to do demonstrated to the world that under written constitutions a republic can be established in which the executive can do little harm. We have also demonstrated to our own satisfaction that under the system which we have developed the executive can do little good.

"But there have been also other results. It has been found to be impossible to operate a great complex institution at all successfully without some kind of leadership. Not having provided in our constitution for responsible leadership for common welfare purposes within the government, irresponsible leadership has been developed by organizations of men for selfish purposes on the outside. In place of a responsible leader who may be held to account and made responsive to the will of the people, we have the 'boss.' Instead of the 'electorate' and the 'representative body' having laid before them each year a well-prepared plan, a definite proposal, for which a responsible executive may be held to account, the people without knowledge of what is going on have seen hundreds of millions of dollars of public resources each year