This analysis points to an ordinal ranking of the most important problems facing local government. Both the evidence set out above, and the theoretical framework which it supports, identify effective democratic representation and corruption as the most urgent challenges to good municipal government. Before these first-order issues, local capacity shrinks to the status of a second-order concern. But the usual priorities of local-government programs, including those financed by the international aid community, focus precisely on capacity building measures - implementing information and budgeting systems, accompanied less often with instruction in the rules of parliamentary procedure. These activities concern the mechanics of running a municipal government, but ignore the deeper problems that go to the heart of public accountability and legitimacy. If we ignore these problems we risk not merely wasting money and efforts in the wrong battle, but actually worsening the state of local governance by putting resources and knowledge in the hands of those bent on subverting local government.
Instead, efforts must concentrate on building a regime where the systemic incentives promote accountability and public responsiveness to local needs and demands. The point must be not to stop corruption at a given moment, but rather to install a system where politicians are held fully responsible for their actions; where they receive full credit for their successes, and the full weight of public opprobrium is brought to bear when they transgress the bounds of legal and ethical conduct, through the media, the normal and spontaneous channels which arise in any social setting, and through regular, fair elections. In such a system, politicians interested in turning popular demands into municipal outputs will thrive, not only for the duration of a program, but sustainably over the long run.
Such a regime does not come about spontaneously, but depends crucially upon a number of minimum political and social conditions. The first is an open, fair political system - open to all parties and individuals, and with free and fair elections. The underlying rules of the game must be well-established, clear, and must be enforced if the system is to be legitimate and binding. Anything less risks corroding popular faith in the regime, erecting barriers to accountability, and may tempt extra-systemic behavior which can ultimately undermine local democracy, at least in substance. The second is transparency in local political and economic affairs - good information widely disseminated on the political and economic dealings of government. As per the case of local tax revenues discussed above, anything that serves as a barrier to transparency in the business of government allows rent-seeking to flourish. Thirdly, social cohesion and organization - where the fabric of society is strong, private - sometimes informal - methods of supervision and control can substitute for the legal safeguards which in many developing countries are too weak to ensure that high standards of public conduct are met. Lastly comes central government as neutral administrator and referee. Although this paper has dealt little with the role of central government, there can be no doubt that it is very important to the success of any decentralization program. Because most such schemes will include some element of central-local grants, and because the power of central government will extend to the local level even in a highly decentralized framework, its behavior will do much to define the context in which local government operates and the possibilities that are open to it. It is thus very important that the center resist the temptation to intervene in local affairs, so perverting the incentives inherent to the local system. A significant degree of local autonomy is crucial if local democratic incentives and controls are to have any meaning, and if voters are to take an interest in municipal affairs. Excessive meddling from the center risks downgrading local officials from administrators and decision-makers to lobbyists seeking national favor in the capital.
These, then, are the conditions under which decentralization - with good will, careful planning, and luck - can thrive. And with it the increased governmental effectiveness, distributive equity, and popular satisfaction which comprise decentralization’s bright promise. We end this paper with a hopeful note from the field.
Bolivia is the poorest, most backward country in South America. It has dozens of spoken languages, a ruinous geography, and almost no infrastructure. If we can make decentralization work here, it can work anywhere.
- Armando Godinez, anthropologist and social researcher
