The practice of appointing White House "czars" to rule over various issues or regions is not a new invention. But centralized management by the White House staff has been greatly increased in recent years.Shultz sees the impossible confirmation process as a primary culprit in this emphasis on White House-based decision-making. The inability to fill critical sub-cabinet ranks quickly makes it impossible for the president to get a firm rein on the bureaucracy. My advisor, Mac Destler, in his Presidents, Bureaucracies, and Foreign Policy discusses the President's need to create centers of strength at various levels throughout the bureaucracy. It is also fair to say that the record of White House czars is not a strong one.
Beyond constitutional questions, such White House advisers, counselors, staffers and czars are not accountable. They cannot be called to testify under oath, and when Congress asks them to come, they typically plead executive privilege.
The consequences, apart from the matter of legitimate governance, are all too often bad for the formation and execution of policy. The departments, not the White House, have the capacity to carry out policies and they are full of people, whether political appointees or career governmental employees, who have vast experience and much to contribute to the making of policy. When White House staffers try to formulate or execute policy, they can easily get off track in a way that would not happen in a regular department.
As secretary of state under President Ronald Reagan, I experienced this with great pain when White House people developed and ran an off-the-books program of arms sales to Iran. It erupted in the Iran-Contra scandal involving the unconstitutional transfer of funds not appropriated by Congress to the Contras, and with close to devastating consequences for the president.
Iran-Contra is a dramatic example, but the more general problem is the inability to take full advantage of available skills and expertise in policy making, and the difficulty in carrying out the functions of government nationally and internationally.
There is other literature that suggests that there are regular patterns to Presidential centralization and dispersion of power. On key issues, the President puts the issue under the White House rubric until he has built the bureaucratic network he needs to further the issue. There is also the issue of scale. Presidents now appoint thousands when they take office. It isn't that these appointees are disloyal, but they probably don't know what the President wants and thus are liable to capture.
None of this is to say that Shultz's argument for easing the appointment process is not a good one - it is! His own record of success as a bureaucratic infighter is impressive (I hope he'll let me interview him when I get to that stage...)
One interesting note to the VP obsessed is that back in the mid-80s when the Reagan Administration couldn't figure out how to manage international terrorism Shultz apparently proposed VP Bush to head a Terrorism Task Force (I wrote a paper on it). Terrorism is THE inter-agency problem and a White House coordination effort was the only way to manage the process. But of course the VP is not a staffer, he (and one day she) is very much a public figure that is ultimately accountable.