The essay Bureaucracy was written and first published in 1944. Its main objective is an investigation of the contrast between bureaucratic management and business management. As such it is an invaluable contribution to the great historical debate between individualism and collectivism.
Professor Mises does not condemn or blame bureaucracy. He merely explains its meaning and discusses its proper spheres of application. In fact, in certain fields it may be the only possible method for the conduct of affairs. A police department, for instance, or the Marine Corps cannot be operated by profit management, as it cannot sell its services on the market. No matter how valuable and indispensable its achievements may be, they have no price on the market and therefore cannot be calculated in a profit and loss statement.
But whenever government endeavors to apply bureaucratic management to private business, the consequences are often disappointing. Social and political objectives usually supersede rational calculation of cost and yield, which fosters economic inefficiency and bureaucratic complacency. When economic production is completely bureaucratized, the individual is lost in a maze of regimentation and regulation. Youth especially is condemned to a listless life of subordination and obedience.
In the words of Mises,
Government jobs offer no opportunity for the display of personal talents and gifts. Regimentation spells the doom of initiative. The young man has no illusions about his future. He knows what is in store for him. He will get a job with one of the innumerable bureaus; he will be but a cog in a huge machine, the working of which is more or less mechanical. The routine of a bureaucratic technique will cripple his mind and tie his hands. He will never be free to make decisions and to shape his own fate. He will never be a real man relying on his own strength. He shudders at the sight of the huge office buildings in which he will bury himself.
This review originally appeared in the Freeman, Vol. 20 (1970), p. 442.
