“Every single VA senior executive received an evaluation of ‘fully successful’ or better over a 4-year period.”

Absolutely great USA Today column
by Instapundit Glenn Reynolds about the VA scandal and the larger
lesson about perverse public-sector incentives at the root of it
all:

Even though veterans were dying, and
books were being cooked, every single VA senior executive
received an evaluation of “fully
successful” or better over a 4-year period. That’s
right. Every single one. Over four years. At
least 65% of them received bonuses (“performance
awards“). All while veterans around the country were suffering
and dying because of delayed care.
The executives got these bonuses, in part, because
they cooked
the books, because the bonuses were more important to them than
the veterans’ care.

It would be nice to believe that this sort of problem is limited
to the VA, but there’s no particular reason to think that it is.
The problem with the VA is that, like every other government
agency—and every other human institution —it’s not a machine that
runs itself. It’s a collection of people. And people tend to act in
their own self interest.

He continues:

the strongest priority of most bureaucracies is the welfare of
the bureaucracy and the bureaucrats it employs, not whatever the
bureaucracy is actually supposed to be doing.

Read the whole thing.

Reynolds is not a nihilist who believes that nothing can improve
the situation. But it’s not an easy nut to crack. The starting
point is to recognize that the worst attributes of self-interested
behavior are, ironically, mitigated more effectively in market
situations. Yes markets are made up of individuals and groups
(companies, firms, nonprofits, etc.) all pursuing their advantages.
Unlike in the public sector, where actors typically have guaranteed
revenue or a state-enforced monopoly over a certain set of goods
and services, private-sector actors have to woo and keep customers.
Observers such as Bernard Mandeville
understood that “private vices” yield “publick benefits” and
Adam
Smith noted that “it is not from the benevolence of the
butcher, the brewer, or the baker that we expect our dinner, but
from their regard to their own interest.” More recently,
Milton Friedman was fond
of saying:

The case for free enterprise, for competition, is that it’s the
only system that will keep the capitalists from having too much
power. There’s the old saying, “If you want to catch a thief, set a
thief to catch him.” The virtue of free enterprise capitalism is
that it sets one businessman against another and it’s a most
effective device for control.

The same dynamic doesn’t apply in
many government situations and certainly doesn’t in a place such as
the Veterans Administration, which not only delivers benefits but
determines whether you get them in the first place. The first step
toward reform is to recognize the root problem of the dysfunction:
There’s a total disconnect between customer satisfaction and
rewards for those within the system. Seriously, every
senior exec at the VA was great at his or her job? What is this,
Lake Wobegon for bureaucrats? The second step is to introduce
competition among providers, especially by giving beneficiaries the
all-important power to go elsewhere, whether through
vouchers or other means. All businessess, whether private-sector or
public-sector, shape up the minute their gravy train is
imperiled.