Why do fiscal policy and public management policy look like olive oil and vinegar in Brazil – and what to do to mix them? That is the puzzle analysts barely suspect when looking to the Brazilian government. It is as if each policy community were in the blind spot of the other one. And they recurrently fail to grasp the other’s attention, dilemmas and menu choices.
This paper describes the failure of putting both policies in a common conversation since 1995 until 2015. It covers five presidential mandates of three Presidents: Cardoso (2 mandates), Lula (2 mandates) and Dilma (1 mandate + 1 one year). It describes how both areas evolved in parallel worlds without intertwining with each other as it occurred in western democracies.
The paper utilizes recent data in the federal government (personnel, procurement, planning, auditing and public finance) and the literature related to this field. Based on this, a diagnostic was done about the trajectory and consequences of isolation between public management and public finance policies.
Financial concerns were at the birth of new public management. Efficiency has always been a cornerstone of managerialism. Public management reforms were triggered by alliances between reformers and economic teams in most countries in which policy changes have occurred. It didn’t happen this way in Brazil. Public management reforms neither dialogue nor interact with the finance policy community entrenched at the treasury.
The authors argue that a group of six factors contributed to the persistent apartheid between public management and public finance challenges. These explanations include: asymmetric policy communities’ robustness, corporatism group thinking and impossibility to reform itself, insulation of the country in terms of global policy debates, insufficient seriousness of the fiscal crisis that hit the country twice in these decades, reformers political incapacity to win their cases and the reification of a cognitive trap that inhibited policy learning on the intersection of both areas – the algorithm trap.
Recent facts appoint that the observed trajectory tends to keep its earlier path of isolation between public management and public finance. The voting of the so-called “Ceiling Law” – a clear demonstration that politicians decided to tie their hands in exchange of the markets credibility – inaugurated a new macroeconomic environment. But a confortable buffer was introduced in order to allow the government to expand its primary deficits at least until the October 2018 presidential elections. Innovations continue to occur especially in areas boosted by the digital revolution under the Ministry of Planning responsibility. But changes in the fiscal policy didn’t follow the same pace.
Public finance authorities focus on macro terms while public management officials concentrate on micro challenges. Both are concerned with structural matters. The formers are centred in financial matters while the latters in institutional dimensions of governmental challenges. The governance of the relationship is neither trivial nor automatic. The more aligned and concatenated both policies coalesce the more effective the initiatives should perform. The more apart both policies remain the weaker their effectiveness.
The practice panel (Connecting researchers and practitioners SIG)
The_algorithm_trap-_14.03_-_sem_marcas_de_revis_o.pdf 