The Comptroller General’s Department: Origins and Early Challenges (1917-1926)
CHAPTER IV: The Department of the Nation’s Comptroller General of the 1st Period (1917-1926)
A) Background and Motivations
Not until the creation of the Department of Audit was there a really strong step in the control. Before, there had been only more or less hesitant movements. The new department was created on December 25, 1917, with the Act being issued on January 18, 1918.
That the Comptroller mechanism emerges as a moralistic one must be emphasized, but with the caveat that it was not only born for this purpose. Corruption is a fact of public administration, not just Mexican, but from anywhere in the world. Suffice it to cite the case of the Ottoman Empire. To be in their best studies of management science—the famous kanun-nama, written mostly between the sixteenth and eighteenth centuries—are allegations against the immorality of state officials who led the Ottoman state to financial ruin. The Comptroller, therefore, fulfills primarily a function of administrative moralization. “In effect, the institution of the Comptroller had a great moral purpose,” say the authors of the document we are now considering.
The creation of the Department of Accounting and Gloss was not just a partial measure, but also a frustrated one because it was next to the Treasury, organizationally subordinate to the Ministry of Finance which, “in short, had her hands full control of administrative and fiscal public funds, being the sole arbitrator, not just to sort through payments and expenses from the Treasury but also to sanction the investment of the same, through the Department of Accounting.”
Thus, it oversaw all other executive agencies, but it itself could freely dispose of its own expenses and really become the manager of all others. “Mexico, a highly centralized country, armed with a thick bureaucracy inherited by the Viceroyalty, organized into a highly structured political state based on that vast organism that is public administration—in short, a country genuinely qualified as a state administrative—knew no other form of composition than the accumulation of political power. The government, meanwhile, no one knows but the accumulation of power in the Ministry of Finance and Public Credit.”
The Comptroller had come to change the structure of state political power, which rests on the administrative organization. In Mexico, until today, the struggle for power has been the struggle to obtain the charges for which the State is conducted.
1. Critical Aspects on Creation
It is a common fact that every new idea or institution, however remarkable the benefits that are produced, faces some resistance and often strong opposition in trying to take root. There are never those who maintain a stubborn spirit of a system or raise their voice to feel their interests affected.
The creation of the Comptroller—the budget and granary guardian of order, efficiency, and morality in the handling of public funds and management of national heritage—faced much resistance from those affected by the moralizing task it was designed to perform in honor of society and law.
The department had been structured primarily with units belonging to the Secretary of Finance and with authority to oversee the other agencies of the executive, especially in public spending.
2. The Study by L. G. Llergo
In 1920, there was a reaction that bore witness to the feelings of the Treasury officials, not from them, but from a journalist named L. G. Llergo. His grades in that year appeared in the newspaper El Heraldo and were then reproduced as a book with the significant title Disruption of the Treasury, the Effect of the Creation of the Comptroller. The title says it all: the Comptroller, born in much of the organizational bowels of the Ministry of Finance, made with his birth—worth these analogies—that the traditional gynecological and respectable deranged Treasury, making a unit since lost prestige, efficiency, and above all, its privileged place in the comity of public administration.
The work under review is the dual biography of the Comptroller and the Treasury, but at a moment of such importance that even after the deletion of the first, public administration would not be beaten. Llergo began his presentation by noting that even before the creation of the Department of the Comptroller, Finance was relatively reformed. As for taxes, a department was created on purpose, that is, an action of the Treasury became a particular organism.
This disruption began. Other measures, arising from the revolutionary struggle, increased it, rather than seeking the institutional framework of public finances. Thus, with the abolition of Banks of Issue, a Banking Department was created to manage its resources and perform its functions, although there was a credit. “The customs rates were altered in several ways, and the contribution of the ring generally increased under the guise of revolutionary needs.” Clutter, adds Llergo, extended to public services such as postal and telegraph, which doubled and were “much worse than before.”
The Ministry of Finance, a highly conservative unit, had operated effectively since its establishment in 1821. The commitment of its employees with the state—the first steps of the civil service in Mexico, which resulted in the governments of Arista and Santa Anna (the last one), and was ratified by Juarez—a commitment that neutralized the struggle of parties, was abjured by the State necessarily born of revolution, while the same Juarez, while confirming the streamlined system of entry and stay in the service, refused entry to officials loyal to Zuloaga and Miramon. A revolution, leading to a new regime at the top of the state, organized expression, cannot respect commitments made during the government that it has overthrown. Therefore, the hacienda funcionarizado drew on men emerged from the triumphant revolutionary groups. Hence, the interpretation of Llergo in the sense that “personal financial management, which imports far is of a high moral level, greatly decreased the pretext of merit and revolutionary commitments, perhaps it was not possible to circumvent,” from which he extrapolated that this contributed to further disrupt the administration of Inland Revenue.