In the novel by Hermann Hesse Journey to the East, a group of pilgrims embark on a spiritual journey, led by Leo, a seemingly humble servant who attends to their needs and maintains order. Halfway through, however, Leo suddenly disappears, and the pilgrimage descends into chaos. The pilgrims, who considered themselves the true leaders, are left lost without Leo's silent but essential presence.
The same risk arises when experienced civil servants disappear - the career civil servants, administrators and experts who ensure the smooth functioning of the modern state, usually far from the public eye. When they are suddenly removed - and this is currently happening in key American agencies (USAID, FBI, CIA, National Science Foundation, National Oceanic and Atmospheric Administration, and National Institutes of Health) - the state administration under the new leadership simply does not continue to function as before. On the contrary, fragmentation, inefficiency and dysfunction occur - just like with Hesse's pilgrims. In Hesse's story, it is just one man, but Leo symbolizes all those nameless bureaucrats and civil servants who keep the ship of state afloat.
The crux of the problem boils down to the principal-agent dilemma. The concept was developed in the 1970s by economists Stephen Ross, Michael Jensen, and William H. Meckling to explain the problem that can arise when one party acts on behalf of another. In government, political leaders ("principals") rely on bureaucrats or officials ("agents") to carry out their decisions. Political leaders, of course, want their directives to be carried out exactly as they intended, but bureaucrats are guided by their own specialized knowledge, ethical principles, and long-term priorities, putting the stability of the system ahead of short-term political goals.
To overcome this dissonance, principals in the second Trump administration are seeking to replace or simply eliminate agents. However, such purges usually backfire, because when a paranoid leader marginalizes his own agents, he no longer has the means to effectively govern the country.
Paranoia is a dangerous mindset in government. A leader who constantly doubts the loyalty of his officials can begin to see enemies where there are none—much like Trump’s perception of threats coming from the “deep state.” The result is a vicious cycle: as more officials are removed or marginalized, institutional knowledge is lost, governance becomes less effective, and the leader’s fears are further entrenched in the dysfunction he has created. Instead of a well-organized administration, the government becomes reactive, chaotic, and incapable of long-term planning.
This can manifest itself in a variety of ways. In agencies like the FBI and CIA, forced retirements and contract buyouts inevitably lead to a loss of expertise needed to track national security threats, reducing morale and deterring potential new recruits. In addition, replacing experienced professionals with political loyalists can jeopardize the collection, analysis and sharing of intelligence. Some US allies may refrain from sharing classified information for fear that it could end up in the hands of Elon Musk or Tulsi Gabbard, leading to poor decisions at the highest levels of government.
Similarly, American foreign policy will suffer because, with the destruction of USAID, it has lost long-standing ties to local communities around the world. This weakens American diplomatic reach and influence, making it more difficult to pursue US strategic interests.
The loss of experienced professionals from agencies like the National Science Foundation (NSF) will slow research, delay technological innovation, and weaken America's ability to respond to new challenges and risks, such as those related to artificial intelligence, climate change, or public health crises.
German sociologist Max Weber, the founder of modern administrative theory, showed that a professional bureaucracy is essential for effective governance. Career civil servants understand the complex processes behind budgets, law enforcement, infrastructure projects, disaster response... Without systems based on rules and merit, which ensure the continuity of the state apparatus regardless of political changes, state governance collapses.
It is equally dangerous to try to run public administration like a private company, where success and failure are measured solely through accounting metrics: efficiency, savings, and profits. While fiscal responsibility is important, implementing corporate financial controls without understanding the purpose of the public sector can have disastrous consequences.
A financial controller or accountant taken over from Tesla may identify potential government savings that look rational on the balance sheet, but which could result in significantly higher costs in the long run.
A striking example of this is the scandal involving the Danish Tax Administration (SKAT) in the 2010s. In an effort to streamline operations and reduce costs, SKAT aggressively reduced staff and implemented other reforms to “increase efficiency”—including eliminating internal fraud detection units, outsourcing key tax collection functions, and relying on automation. The result? Criminals exploited the weakened system and siphoned off an estimated $2 billion through fraudulent tax refunds. In the end, the supposed austerity measures cost Denmark far more than the country saved.
Treating governments as if they were businesses can undermine their core functions. Well-run administration requires not only financial oversight, but also institutional knowledge, strategic insight, and a deep understanding of the unique demands of governance. Prioritizing short-term savings at the expense of long-term stability weakens state capacity, makes public services unreliable, and opens the door to corruption, inefficiency, and systemic failure.
By aggressively downsizing key agencies and treating career officials as adversaries rather than experts, the Trump administration is shifting from the traditional principal-agent dilemma—where bureaucrats do not yield to leadership—to a “paranoid principal dilemma,” where the leader, in a desperate attempt to demonstrate dominance, ends up alone, unable to trust anyone or govern effectively.
As in Traveling to the East, in which the pilgrims find themselves lost without Leo, a government that dismisses too many experienced officials could soon find itself without the "glue" that held everything together. And a leader who is also paranoid - and sees his agents as potential enemies - risks isolating himself within an administration that is both ineffective and deeply unstable.
The author is a policy advisor and professor at the Solvay Brussels School of Economics and Management.
Copyright: Project Syndicate, 2025. (translation: NR)
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