Front Page Titles (by Subject) 2.: Bureaucracy within a Democracy - Bureaucracy
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2.: Bureaucracy within a Democracy - Ludwig von Mises, Bureaucracy 
Bureaucracy, edited and with a Foreword by Bettina Bien Greaves (Indianapolis: Liberty Fund, 2007).
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Bureaucracy within a Democracy
The same thing is essentially valid for democratic government.
It is frequently asserted that bureaucratic management is incompatible with democratic government and institutions. This is a fallacy. Democracy implies the supremacy of the law. If it were otherwise, the officeholders would be irresponsible and arbitrary despots and the judges inconstant and capricious cadis. The two pillars of democratic government are the primacy of the law and the budget.1
Primacy of the law means that no judge or officeholder has the right to interfere with any individual’s affairs or conditions unless a valid law requires or empowers him to do so. Nulla poena sine lege, no punishment unless ordered by a law. It is precisely the inability of the Nazis to understand the importance of this fundamental principle that qualifies them as antidemocratic. In the totalitarian system of Hitler Germany the judge has to come to his decision according to das gesunde Volksempfinden, i.e., in accordance with the sound feelings of the people. As the judge himself has to decide what the sound feelings of the people are, he is sovereign on his bench like the chieftain of a primitive tribe.
It is in fact an awkward thing if a scoundrel evades punishment because a law is defective. But it is the minor evil when compared with judicial arbitrariness. If the legislators in a democracy acknowledge that the law is inadequate, they can substitute a more satisfactory law for a less satisfactory. They are the mandatories of the sovereign, the people; they are, in this capacity, supreme and responsible to the voters. If the voters disapprove of the methods applied by their representatives, they will, at the next election, return other men who know better how to adjust their actions to the will of the majority.
It is the same with the executive power. In this field too there is only the alternative between the arbitrary rule of despotic officeholders and the rule of the people enforced by the instrumentality of law abidance. It is a euphemism to call a government in which the rulers are free to do whatever they themselves believe best serves the commonweal a welfare state, and to contrast it with the state in which the administration is bound by law and the citizens can make good in a court of law their rights against illegal encroachments of the authorities. This so-called welfare state is in fact the tyranny of the rulers. (Incidentally we have to realize that even a despotic government cannot do without regulations and bureaucratic directives if it is not to degenerate into a chaotic regime of local caciques and to disintegrate into a multitude of petty despotisms.) The aim of the constitutional state also is public welfare. The characteristic feature that distinguishes it from despotism is that not the authorities but the duly elected people’s representatives have to decide what best serves the commonweal. This system alone makes the people sovereign and secures their right of self-determination. Under this system the citizens are not only sovereign on election day but no less so between elections.
The administration, in a democratic community, is not only bound by law but also by the budget. Democratic control is budgetary control. The people’s representatives have the keys of the treasury. Not a penny must be spent without the consent of parliament. It is illegal to use public funds for any expenditures other than those for which parliament has allocated them.
Bureaucratic management means, under democracy, management in strict accordance with the law and the budget. It is not for the personnel of the administration and for the judges to inquire what should be done for the public welfare and how the public funds should be spent. This is the task of the sovereign, the people, and their representatives. The courts, the various branches of the administration, the army, and the navy execute what the law and the budget order them to do. Not they but the sovereign is policy-making.
Most of the tyrants, despots, and dictators are sincerely convinced that their rule is beneficial for the people, that theirs is government for the people. There is no need to investigate whether these claims of Messrs. Hitler, Stalin, and Franco are well founded or not. At any rate their system is neither government of the people nor by the people. It is not democratic but authoritarian.
The assertion that bureaucratic management is an indispensable instrument of democratic government is paradoxical. Many will object. They are accustomed to consider democratic government as the best system of government and bureaucratic management as one of the great evils. How can these two things, one good, the other bad, be linked together?
Moreover, America is an old democracy and the talk about the dangers of bureaucracy is a new phenomenon in this country. Only in recent years have people become aware of the menace of bureaucracy, and they consider bureaucracy not an instrument of democratic government but, on the contrary, the worst enemy of freedom and democracy.
To these objections we must answer again that bureaucracy in itself is neither good nor bad. It is a method of management which can be applied in different spheres of human activity. There is a field, namely, the handling of the apparatus of government, in which bureaucratic methods are required by necessity. What many people nowadays consider an evil is not bureaucracy as such, but the expansion of the sphere in which bureaucratic management is applied. This expansion is the unavoidable consequence of the progressive restriction of the individual citizen’s freedom, of the inherent trend of present-day economic and social policies toward the substitution of government control for private initiative. People blame bureaucracy, but what they really have in mind are the endeavors to make the state socialist and totalitarian.
There has always been bureaucracy in America. The administration of the customs and of the foreign service has always been conducted according to bureaucratic principles. What characterizes our time is the expansion of the sphere of government interference with business and with many other items of the citizenry’s affairs. And this results in a substitution of bureaucratic management for profit management.
[1. ]This is not a definition of democratic government but a description of the administrative technique of democratic government. The definition of democratic government is: A system of government under which those ruled are in a position to determine, directly by plebiscite or indirectly by election, the exercise of the legislative and executive power and the selection of the supreme executives.