Stephen Goldsmith is deputy mayor for operations for the City of New York.

In the early 20th century, the Progressive Era transformed municipal government, greatly improving operations and ending the culture of corruption that preceded it. The progressives' rule-based approach worked well -- for its time. But here in the early 21st century, the very rules which proved so valuable 100 years ago have become an albatross around the neck of public leaders.

The fiscal crisis demands change. It's time for a Post-Progressive Era, one predicated on creating public value as efficiently as possible. This means rethinking the rules of the early 20th century in light of the technology of the 21st century.

In many ways, New York City government is a testament to both the promise and the limitations of the progressive movement. In the beginning of the 20th century, the progressives introduced a modernized, rule-based approach to public-sector management designed to root out the evils of the machine politics of Tammany Hall. Prior to these reforms, city government in New York and elsewhere was largely run on the "spoils" system. Favoritism, cronyism and corruption were the basic operating system of municipal government.

The progressives introduced a set of even-handed rules. Reforms included a workforce selected by "civil service" testing rather than political loyalty. No longer would election returns result in the firing of front-line employees. Along with testing and job classifications, civil service protections would cure a politically infected personnel system. New York City government today operates professionally and capably with overall very good results and surprisingly little corruption.

Progressive reforms also altered the way governments purchased goods and services. Contracts would be chosen through an open, competitive bidding process, rather than kickbacks or campaign contributions.

In many ways, the rules worked.

But for those of us interested in taking a leap onto a new platform of modern governance, the medicines that cured the Tammany Hall-type ills now have become part of the problem. Too often, the thinking in government seems to be "if some rules are good, than more rules are better."

Too many rules rob managers of discretion, and often result in suboptimal choices made "by the book." Promotional tests within the New York City Fire Department preempt the discretion of the fire commissioner to identify and promote the high-performing battalion commander to deputy chief. Initiative and effort take a back seat to studying for an exam. I often envision the old World War II movies, the ones where the lieutenant gets killed in battle and someone has to step into a leadership role. Imagine if instead of an instant field promotion to a heroic soldier, they took a break from fighting in order to pass out tests to determine who will be promoted.

To make matters worse, New York's state government imposes a bewildering set of approval requirements on the city as if to suggest that thousands of rules need thousands of state officials overseeing the local rules. New York City's fire commissioner recently explained to me a complicated and creative way to improve response times for medical emergencies. When I asked him when he was going to implement this potentially life-saving change, he told me that he couldn't say, since the changes involved required approval from Albany. Hence, we have the commissioner of arguably one of the best fire departments in the world waiting for approval from a state official in order to allow him to save lives.

And where there are rules, there will be lawyers and courts interpreting these rules. Expansive rulings by the courts and arbitrators relentlessly encroach on anything that looks like worker discretion or managerial prerogatives. Not long ago, New York City Mayor Michael Bloomberg decided to remove "free parking" placards from thousands of employees due to a rash of abuses. The mayor's action was challenged, and an arbitrator -- who was not elected by the people, by the way -- overruled the mayor's decision. Did progressives really intend such a dismantling of accountability at the price of reform?

The public sector was very different 100 years ago.

In a world where public employees don't daily face new challenges, where time does not matter, where government faces no urgent demands and where tax dollars are plentiful, these rules based on rules and approvals stacked on approvals may make sense. But today we are enemies of our own reform efforts. It's not that the progressives made a mistake. They provided the solution for the problem of the time with the tools of the time. Red tape served a purpose in slower moving, paper-based time.

Today, however, we no longer have to choose between accountability and flexibility, or between the delay of approvals and unfettered discretion. A post-progressive agenda would approach its relationship with employees, vendors and citizens differently: fewer job classifications, more emphasis on performance as a condition of promotion and more rewards for outstanding performance.

Technology must play a role. Digital systems could allow managers to observe the decisions of their employees in real time -- how long each building inspector spends on a site, for example, as well as data driven analysis of performance. Instant oversight allows instant decision making: fewer rescheduled visits, fewer handoffs, better citizen service.

Citizens should demand better results from public vendors as well. Contractor value -- performance per unit of price -- should matter. We don't need more rules around bidding, we need a better management regime to write, administer and monitor complex contractor relationships. When my friend Mitch Roob first took over the sprawling Indiana Department of Family Services, he discovered that the department had 10,000 vendors and little ability to manage them well. He suggested that having 100 vendors, each of which was responsible for a more integrated supply and service chain, could in turn be better monitored by the state.

Last century's corruption produced dramatic reform. This century's spending, and its drag on the country's future, mandates new post-progressive reform.