In economics as in philanthropy we often succumb to the tidy-minded approach when we would perhaps be better served by embracing a degree of mess.
If I had to sum up the lessons of my book Great Philanthropic Mistakes in one paragraph, it would be this: any effort by a foundation to use grants to manage human behavior ends in failure. The Ford Foundation in the 1960s, for example, tried to empower African-American parents in New York City and ended up provoking three teachers’ strikes and delaying school choice for a generation. They tried to encourage poor people to take control of their lives and inspired the creation of organizations that were ineffectual at best and hotbeds of radicalism at their worst. The Annenberg Foundation spent nearly $500 million on school reform and found their money leached away by calcified central offices.
Tim Harford doesn’t discuss philanthropy in his new book Messy: The Power of Disorder to Transform Our Lives. But he would agree that efforts to control the behavior of others, be it through grants or through managing, could become counter-productive very quickly.
“The argument of this book,” he writes, “is that we often succumb to the tidy-minded approach when we would be better served by embracing a degree of mess.” Have more anarchy and freedom in your work, he argues, and you’ll be more productive than those who are tightly controlled and micromanaged.
Harford is a columnist for the Financial Times; given that newspaper’s high paywall, the columns are more easily accessed through his personal website. He also does a lot of work for the BBC. But judging from the relatively small lines at his book signing in Washington, I don’t think he’s as well known in the U.S.
Harford’s niche is as an economics explainer, in the category pioneered by Freakomomics and occupied by Malcolm Gladwell and Tyler Cowen, among others. Although he is a libertarian, this book doesn’t have explicit libertarian content. However, Harford enjoys case studies of bureaucrats who screw up.
For example, consider Britain’s National Health Service (NHS). Fifteen years ago, they issued a mandate: all “immediately life-threatening” ambulance calls had to be answered within eight minutes. A noble goal, right? Who wouldn’t want ambulances to come quickly?
Here’s how the goal was met. First off, a survey of ambulance response times found a huge number being answered in seven minutes and 50 seconds, and an amazing number at seven minutes and 59 seconds. But for some reason, absolutely no ambulance calls were responded to in eight minutes and one second. So the result, he says, was an “outright lie” by bureaucrats.
But matters were far worse. Suppose an ambulance crew tried to reach a patient and didn’t make it within eight minutes—or, as the NHS would say, the crew “breached the target.” Logic demands that the crew would then try to abandon one client in the hopes of getting to the next one within the eight-minute window. “The best defense against such grotesque abuse,” says Harford, is that ambulance crews would ignore the long-standing order.
Other ambulance services dealt with the mandate by saying many cases weren’t “life-threatening,” or even putting paramedics on motorcycles or bicycles so that one paramedic would show up in eight minutes—without an ambulance. Some ambulance crews said they were parked in various areas in a city rather than at a hospital in the hopes of getting to patients quickly. Finally, an unconfirmed rumor said that ambulances were moved from rural areas to more populous urban ones.
“The target, then,” Harford writes, “encouraged ambulance crews to lie about the stopwatch, to reclassify urgent cases, to put ambulance crews in vehicles that weren’t ambulances, to pull staff out or rural areas, to risk the health and morale of their paramedics, and to celebrate all this as having hit their target. For one simple, tidy target, that is quite a result.”
Much of Harford’s work is about the workplace. He shows that the more control employees have over décor in their office, the more productive they are. A 2010 study by psychologists Alex Haslam and Craig Knight of Britain’s University of Exeter found that when employees were given control over how they decorated their offices, including where they put the plants and the office paintings, they were more productive than employees banned from decorating their spaces. Managers, who, by contrast, practice a “lean office” strategy of total control over the workplace environment find employees are resentful rather than productive.
The role model for messy offices, in Harford’s view, is Building 20 at M.I.T., a 200,000 square foot building hastily constructed in 1943 to house the Radiation Laboratory, which successfully improved radar to allow Allied aircraft to more accurately pinpoint German targets. Nine of the laboratory’s employees went on to win the Nobel Prize.
Building 20 was “ugly, dysfunctional, and unsafe” but stayed up to accommodate the flood of students who attended M.I.T. under the GI Bill. The place was a wreck, but since no one knew where any office was, the result was many chance encounters that encouraged innovation. It also helped that the building was so decrepit that if you rewired rooms or even knocked out a floor no one cared. When Jerome Weisner became president of M.I.T. he kept an office in Building 20 because there “nobody complained if you nailed something to a door.”
Building 20 was full of misfits. The electrical engineers were next to the Model Railroad Club, and the interactions between the two groups resulted in some of the first computer companies and the first video game, Spacewar. Another alumnus of Building 20 was Amar Bose, founder of the Bose Corporation. When the building was finally torn down in 1998, no one cheered.
What can donors learn from Messy? Far too many foundations, including most of the major ones, stress credentials and expertise. They invent new credentials at graduate schools so that their staffs are “professionals.” Their program officers are honors graduates of Ivy League schools. But they’re organizations that, as the Germans would say, are schwerfällig or “ponderous.” Their grants are “correct” ones that would embarrass no one at Davos, the Century Association, or the Council on Foundations but are rarely interesting or innovative.
The Guggenheim Foundation provides a constructive example. When the foundation started, its officers saw themselves as talent scouts. They were proud of giving a grant to Samuel Barber at 24 and Aaron Copland at 26 and being the foundation who first supported young talents who became America’s greatest artists.
But by the 1970s the Guggenheim Foundation had hardened. Its president, Gordon Ray, referred to the fellowship in 1977 as a “senior postdoctoral fellowship.” “Nothing pleases us than to make awards to younger persons,” Ray wrote in the foundation’s 1979 annual report, “but not many of those who apply to us have as yet attained the kind of credentials necessary to survive in the strenuous competition they must face.”
The Guggenheim Foundation prior to 1945 was a messy but brilliant organization. It then became a ponderous organization where credentials mattered more than innovation. The lesson of Messy is that far too many foundations, including most of those endowed in perpetuity, are headed towards the path of schwerfallig –lumbering old organizations that accomplish very little with their vast endowments.