In a recent column, David Brooks had this to say about the scope of government nowadays:
The heart of any moral system is the connection between action and consequences. Today’s public anger rises from the belief that this connection has been severed in one realm after another.
Financiers send the world into recession and don’t seem to suffer. Neighbors take on huge mortgages and then just walk away when they go underwater. Washington politicians avoid living within their means. Federal agencies fail and get rewarded with more responsibilities.
What the country is really looking for is a restoration of responsibility. If some smart leader is going to help us get out of ideological gridlock, that leader will reframe politics around this end.
Philip K. Howard has thought hard about the decay of responsibility and what can be done to reverse it. In a series of books ranging from “The Death of Common Sense’ to “Life Without Lawyers,’ Howard has detailed the ways our political and legal systems undermine personal responsibility.
Over the past several decades, he argues, a thicket of spending obligations, rules and regulations has arisen, which limits individual discretion, narrows room for maneuver and makes it harder to assign responsibility.
Presidents find that more and more of their budgets are precommitted to entitlement spending. Cabinet secretaries find that their agenda can’t really be enacted because 100 million words of existing federal rules and statutes prevent innovation this way and that. Even when a new law is passed, it’s very hard to tell who is responsible for executing it because there is a profusion of agencies and bureaucratic levels all with some share of the pie.
These things weaken individual initiative, discretion and responsibility. But the decay expands well beyond Washington. Teachers don’t really control their classrooms. They have to obey a steady stream of mandates that govern everything from how they treat an unruly child to the way they teach. Doctors don’t really control their practices but must be wary of a capricious malpractice system that could strike at any moment. Local government officials don’t really govern their towns. Their room for maneuver is sharply constrained by federal mandates and by the steady stream of lawsuits that push them in ways defying common sense.
What’s needed, Howard argues, is a great streamlining.
Yes, that’s the problem, all right, and Alexis de Tocqueville saw it coming almost 200 years ago. In a prescient passage from Democracy in America he described exactly where we find ourselves in 2010 (I’ve quoted this passage before, but it so aptly describes what Brooks laments that I thought I’d post it again):
The sovereign extends his arms over the whole society; he covers its surface with a web of small, complicated, painstaking, uniform rules through which the most original minds and the most vigorous souls are unable to emerge in order to rise above the crowd; it does not break wills but softens them, bends them, and directs them; it rarely forces men to act, but constantly opposes itself to men’s acting; it does not destroy, it prevents things from coming into being; it does not tyrannize, it hinders, it presses down upon men, it extinguishes, it stupefies, and it finally reduces each nation to no longer being anything but a herd of timid and industrious animals, whose shepherd is the government.
I have always believed that this sort of regulated, mild, and peaceful servitude, whose picture I have just painted, could be combined better than one imagines with some of the exterior forms of liberty.
If there is a fitter description of what ails us, or of what the conservative uprising in America today is pushing back against, I haven’t seen it.
34 Comments
Indeed!
Yesterday’s paper offered a good example.
There is a lot to pick apart in David Brooks’s piece, as there usually is. However, the second paragraph stands out for being particularly untethered to reality.
Financiers suffered plenty when the world went into recession. Lehman Brothers went bankrupt. Bear Stearns, Washington Mutual, Wachovia, and GMAC were liquidated at fire sale prices. AIG and Citibank went into government receivership. Across the board, stock prices for banks got wiped out. For example, the Citibank share price went from the mid-50’s to 99 cents. (Which reminds me of a joke. The difference between beer nuts and deer nuts? Beer nuts are fifty cents, and deer nuts are under a buck.)
When homeowners walk away from their mortgages, they get foreclosed and lose their homes.
It’s unclear what Brooks’s proposed remedy is — debtors’ prison? — but it seems to me that those who have made foolish financial decisions have suffered plenty for their poor judgment.
It’s unclear which Washington politicians are “living beyond their means.” Charlie Rangel?
It’s also unclear which federal agencies got rewarded after failing, but he seems to forget the Bush years. Agencies like the SEC and FEMA failed because they had inept leadership, were poorly funded, and had a directive not to regulate. Replacing the management and returning the level of enforcement to status quo ante is not a reward: it’s simply the right thing to do.
Brooks then makes the logically challenged leap to declare that because people think they can get away with whatever they want, somehow it’s the government’s fault. However, if his true objective is to make the financially inept face consequences commensurate with their ineptitude, there is no entity except for government which can do this. Let’s use the financial tsunami he refers to as an example.
The Bush administration removed the regulatory restrictions which limited banks’ speculative activity. You then had banks like Lehman Brothers levering their capital on a 30 to 1 ratio, which inevitably led to collapse. The government “rules and regulations” which Brooks so detests were removed, and the result was catastrophic.
What has happened since then? Banks have been regulated to increase capital requirements. Their ability to use customers’ funds for proprietary trading has been sharply curtailed. Banks can’t write mortgages with no documentation or 95% LTV. AIG and Citibank — the largest American insurance company and bank, respectively — were put into receivership. The management was replaced, the shareholders were wiped out, and their businesses were rationalized. Legislation was passed which prohibit the banks’ most egregious consumer lending practices.
What have the results been? Banks are not making dumb mortgages. The government has been selling their Citibank stock, and making a profit. (The other banks who received TARP funds repaid the government some time ago). AIG announced this morning that its $180 billion loan and credit facility are being repaid. Had AIG or Citibank collapsed, we would have likely had a systemic economic collapse. They are now smaller, profitable institutions, and their transformation has come at little or no cost to taxpayers. Incidentally, the repayment has reduced the federal deficit (e.g., the AIG repayment removes a $180 billion liability from the federal balance sheet).
When these bail-outs occurred, all we heard from the Right was talk about government take-overs, socialism, and so forth. Events have proven them wrong and illustrated the vacuity of their ideology. It is precisely the right wing troika of lower taxes, enfeebled regulation, and smaller government which got us into this mess, and it was strengthened regulation and a more robust government which stabilized the economy and led to economic recovery. Brooks and his ilk misidentify the problem for the solution.
There is a simple and obvious question which has yet to be answered by anyone from the Right. The conservative ideology of lower taxes, smaller government, and castrated regulation was practiced enthusiastically during the Bush administration, which led to the worst economic collapse since the 1930’s. Lacking any new ideas, the only solution the Right offers is the same program whose efficacy was conclusively refuted in the past. Why should now be any different?
A mighty salvo as usual, Peter. You never disappoint. You really should have a blog of your own.
However:
First of all, nobody in his right mind would suggest that the Bush administration was a model of conservative fiscal restraint or contraction of government. Nor, for that matter, is anyone — certainly not me — saying that the banking industry should be completely unregulated.
Second, it is fair to say that the sub-prime collapse was in large part brought into being by pressure from the Left (given teeth in legislation like the Equal Credit Opportunity Act, the Home Mortgage Disclosure Act, and the Community Reinvestment Act) for banks to relax their lending requirements so as to make sure that low-income and minority customers had a shot at the “American Dream”. Barack Obama himself was an attorney in a CRA-based suit filed by ACORN activists and others against Citibank insisting that credit standards be loosened.
Even George Bush went along with this, lamenting “homeownership gaps”. So please don’t get the idea that I’m making any brief for him here, or yearning for a return to his administration’s policies.
In order to make sure that lending outcomes, unmoored from traditionally prudent practices, were “equalized”, banks had to offer things like no-deposit and “Pick-a-Pay” mortgages. The banks’ exposure to default went up sharply, and to maintain their own credit status, it’s hardly surprising that they rolled up their outstanding mortgages into exotic and highly profitable instruments. The only bulwark against collapse was the hope of a steadily rising housing market, but as credit markets began to realize the extent of the problem, the whole thing fell apart.
As for the AIG bailout, that repayment has yet to happen, and its execution under the current plan depends on the share price staying aloft. Meanwhile, AIG executives, rather than being out on the street with the want-ads in their pockets, received more than $180 million in bonuses, thanks to taxpayer largesse.
As for homeowner defaults, the remedy, obviously, is not to sell mortgages to unqualified borrowers.
Herbert Spencer said:
“The ultimate result of shielding men from the effects of folly, is to fill the world with fools.”
But you are focusing too narrowly, anyway, Peter. The point of Brooks’s piece, Howard’s books, Tocqueville’s observation, and this post, is the suffocating, stultifying, enervating effect of vast and capricious government intrusion into every aspect of life.
Jefferson said:
As “progressives” well understand.
The Bush administration was not “a model of conservative fiscal restraint,” but this is largely because of the push of conservatives to lower taxes and pursue an expensive war in Iraq. However, it did aggressively execute a contraction of government regulatory power, as the financial debacle illustrates.
I agree with pretty much everything else you say, except I have no issue with AIG executives getting their bonuses. First, AIG’s problems were caused by a single rogue unit; the many people who worked in other divisions ought not to suffer for something they didn’t do. Secondly, the bonuses were contractually guaranteed. Most importantly, though, I don’t think the government should be in the business of regulating salaries. You could make the argument that since the government was an equity holder, it should have leverage due to its ownership, but in general this is an area the government ought not to get involved with.
However, I’m not going to worry too much about this. I’ll wait until 2013 when President Paladino can figure all this out.
Or President Christie, insha’Allah.
No way. Too fat.
Well, I don’t feel suffocated by government. Do you? I would note, however, that I am mightily cheesed off by getting a $459 ticket generated by a red light traffic camera. So cheesed off that I am fighting Big Brother in traffic court.
Decrying “the suffocating, stultifying, enervating effect of vast and capricious government intrusion” is a meaningless observation without specificity. If government is too big, then identify what it does that it shouldn’t do. Regulate airline safety? Pay veterans’ benefits? Subsidize Amtrack? People like to demand a smaller government up to the point where it affects the benefits which they receive themselves. (As John Kenneth Galbraith said: “my liberalism ceases at personal inconvenience.”)
I’m not saying the government is the right size or the wrong size. I’m simply saying that those who demand smaller government in the abstract bear the burden of identifying exactly how it should shrink, and why the benefits which are abandoned are not worth the cost of maintaining them.
Peter, I could devote the entire content of this blog, for the rest of my life, to identifying suffocating, intrusive government mandates and regulation.
The new 1099 reporting requirement in the Obamacare bill, which almost nobody even realized was in there until after it was passed (because the bill itself was so hugely turgid with regulatory gobbledy-gook that nobody could read the whole thing in the span of a normal Congressional career), is a nice example. Nanny Bloomberg’s relentless crusade to control what New Yorkers may and may not eat is another. The fact that I can’t replace a window in my house without running it by the city’s Landmarks Commission, which insists (because it can) that I buy impossibly expensive custom-made wooden frames — instead of simple, energy-efficient metal ones that are available in any color and look just fine — is an infringement of my liberty that I am finding particularly annoying just now.
Are you seriously suggesting that it is hard to come up with examples of suffocating government intrusion and over-regulation? I could employ a staff of 1000 people simply to find and list examples, and they would be busy round the clock. But I’d never get past all the paperwork I’d have to fill out to get things up and running.
“If government is too big, then identify what it does that it shouldn’t do.”
The monstrosity called “Obamacare” is one obvious example. Why don’t you take it and shove it up your ignorant hole, you pompous prick?
Hey, easy there, Henry. When it comes to politics, I disagree with Peter on just about everything, but he is unfailingly civil. Please return the courtesy.
I can’t comment on the 1099 issue, because I’m not sure what the compliance issues are (i.e., to what extent was tax being avoided because income wasn’t being reported. I’d first like to hear the justification for what on the surface appears to be a burdensome requirement.)
Similarly, I can’t comment on what Bloomberg is doing, because I’m not familiar with it. Does this mean you can’t get a chilibaconcheeseburger in New York? Come here and we’ll have a Double Double at In-N-Out Burger.
Re your window replacement: presumably enough people in New York wanted to enforce a uniformity in landmark districts that they limited owners’ rights in favor of a perceived value in having uniformly nice blocks. Maybe you wouldn’t want your neighbor to paint his house in magenta, and you think that if someone wants to buy a brownstone, they ought to keep it brown to maintain the integrity of the block. Similar to people buying a condo: if you want to live here, you have to abide by the HOA restrictions. In any event, this doesn’t appear to be an example of big government per se — presumably it’s a reflection of New Yorkers’ desire to maintain the lovelier parts of their city, of which your block is one.
My apologies, Malcolm. I guess I need a break from all the crap being generated by the left.
Peter, this is about much more than my window (though let me assure you my neighbors wouldn’t care two pins if I replaced my windows with metal ones that look very nice and cost about a tenth of the ones the city says I have to buy). It is one thing to tear down a brownstone and replace it with a circus tent, and another to buy perfectly decent, affordable windows — and in a reasonably governed community such distinctions would be made, with an emphasis on touching people’s private lives as lightly as possible. But sanity and moderation of this kind is nowhere to be found in the bloated, stifling regulatory apparatus currently in place and growing daily.
Compliance with government regulation of everything from workplace manners to email logging to how bathrooms must be designed is rapidly crushing the life out of small business in America. Examples are not hard to come by.
Another maleficent aspect of over-regulation, less often mentioned, is the enormous increase it creates in opportunities for bureaucratic corruption.
Apology accepted, Henry (although I’m not the one you called a pompous prick.)
I share your irritation with the political Left, as you can imagine, and your comments are welcome. But I do think civility is worth the effort: online discussions so often descend into name-calling, and I’ve generally been fortunate enough to have well-mannered conversations in here so far.
Do feel free to blast away ruthlessly as regards content, however. Rebut and refute at will.
Malcolm,
I apologized to you for my incivility, because I was wrong to violate the rules of conduct in your domain, not for calling a spade a “spade”, albeit admittedly uncivilly.
I promise to behave in the future.
I’m not sure we’re allowed to say “spade” these days, Henry. I’ll check with my legal team.
I really hope we haven’t come to that, Malcolm, spades being the highest ranking suit in bridge.
Well, one man’s fish is another man’s poisson. Perhaps your window treatment is of cosmic importance to your next door neighbor. Or perhaps he is really pissed off that he can’t build the circus tent he always dreamed of. Obviously you can only have one solution, which won’t please everyone. Hence you have elected officials, in the form of a Mayor and City Council members, who decide what the balance should be between what a homeowner can do and what the community would wish him to do.
This could range from Houston, which has no zoning laws, to New York City, which has a very high degree of regulation, as one might expect in a congested city of eight million people. However, whatever balance is struck, presumably it is more or less in concordance with the wishes of the public; if not, the incumbents will ultimately be replaced by people whose views are closer to the consensus. It’s not as though the restrictions on landmark buildings — or building codes, health laws, or whatever — are the result of some devious liberal scheme to mold government in the likeness of an ever-growing blob from a Japanese horror movie. While I certainly wouldn’t suggest that your displeasure at parting with too many of the elusive spondulicks to buy new windows is the result of any innate crankiness on your part, I would suggest that your perception of the lack of a “reasonably governed community” is misplaced. It’s because the community is being governed more or less in accordance with its wishes.
Right. Nobody is suggesting that we abolish all government.
And that, my friend, is the steamroller that is about to hit Washington. A great many Americans now feel that their government has become a swollen, self-perpetuating behemoth that cares not a fig for their consent, that sees the private sector as nothing more than a penned-up cow to be alternately milked and reviled, and that is perfectly happy — as in the infuriating example of Obamacare — to dismiss their wishes with patronizing contempt.
As for my neighbors’ wishes regarding the Landmarks Commission (I have spoken with many of them at length on this topic), let’s just say that to implement them properly would involve a few of our gracious Victorian-era lamp-posts, and some stout lengths of rope.
Well, maybe it is and maybe it isn’t; the hallmark of a “progressive” political agenda, always and everywhere, is a tendency toward collectivism.
But it is simpler than that: as Jefferson observed in the passage I quoted above, government’s natural tendency is to expand, and it will do so of its own accord unless actively resisted.
A steamroller? Ain’t gonna happen. To be sure, Democrats will lose seats, and they may lose the House. The Republicans who win will all do so under the banner of small government. However, with the possible exceptions of people like Joe Miller and Rand Paul, you will not see the election of many people who are truly committed to reducing the size and scope of government, although they will all claim to be against big government in the abstract. Even Scott Brown votes with the Democrats.
One indication of this is Obama’s popularity, which has been rock steady in the mid-forties. Roughly half the people think that the administration is doing about the best that can be done, given the hand it was given. Even if the Dems lose the House, they will have very nearly half the seats; it won’t be a washout. American politics is played in a 60/40 matrix, which oscillates from one side to the other but doesn’t break out of the range.
Another indication is the Pledge to America (sounds like a furniture polish), which wouldn’t specify any of the things which their small government ideology would eliminate. In fact, they specifically rule out budget cuts for Social Security, Medicare, and the military. The arithmetically challenged Republicans won’t accept the notion that you can’t keep taxes low, leave these areas untouched, and balance the budget. Cannot. Be. Done. However, they know the specifics are political losers, so outside their fringe, they are (in LBJ’s words) all hat and no cattle.
Another indication is that they specifically did not eliminate the parts of Obamacare which have already gone into effect, such as the ability to keep insurance for your kid until 26 or limits on refusing insurance for pre-existing conditions. Nor did they say anything about Bush’s prescription drug plan. It’s bumper sticker politics. Complain that Obamacare is bankrupting the nation and then champion its elements. Like the Republicans who voted against the stimulus plan but showed up at the ribbon cutting ceremonies.
I would be very happy with a much smaller government. I believe that health care should be rationed. I do not believe that we should have a sacrosanct right for any medical procedure we desire once we reach 65. I think the eligibility age for Social Security should be raised sooner rather than later. I do not believe the government should be providing crop supports. I believe there are military bases both here and around the world which should be shut down, as well as probably a number of weapons systems. These are the things you have to do if you are serious about matching government expenses to government revenues, but they are political losers which no successful politician will adopt. The problem is not so much that government is too big or too small, but that its resources are misallocated. That’s why (outside of Paul Ryan) you have yet to see a serious plan for reducing government, but legions of people calling for something they have no serious intention of executing.
One other thing which should be seriously looked at is the sale of government property and assets. I don’t see why the government should own tons of gold, vast expanses of unused land, and a huge petroleum reserve when these things could be monetized to pay off debt. You could make the case that what we have is not a balance of payments problem as much as a balance sheet problem. While I wouldn’t go so far as to suggest naming rights for the Statue of Liberty – maybe not, anyway – I think there are a lot of sacred cows which could be sent profitably to slaughter.
Sorry for being late to the party.
Peter I note you wrote, “It’s also unclear which federal agencies got rewarded after failing, but he seems to forget the Bush years” in your opening remarks.
Yet immediately prior, Malcolm embedded a link referring to “The Consumer Product Safety Improvement Act of 2008” which, if you’ll check, arrived during those very Bush years.
You declare, “Well, I don’t feel suffocated by government. Do you?”
I can’t speak for Malcolm but personally, while saying “suffocated” may be a stretch, I can say, “I’ve felt stifled at times.” I add too, when those 1099 rules (as I understand them) kick in re: the new healthcare regulations, were I selling stuff to healthcare providers, then perhaps “suffocated” might well become an appropriate characterization.
Whether you watched PBS’ ‘NewsHour’ or not tonight this piece, provided I can get it properly embedded, was telling, also incidentally from the Bush years:
http://www.pbs.org/newshour/video/module.html?s=news01s43f7qf88
You may not (probably won’t) agree with the basic premise, but remember – this is coming from Arkansas:
http://www.arktimes.com/arkansas/its-all-about-race/Content?oid=1316503
Oddly enough I see the NYT seems to agree on “The Great Arkansas Assessment.”
http://www.nytimes.com/2010/10/01/us/politics/01arkansas.html
The sentence about rewarding ineffective bureaucracies refers to the David Brooks piece.
I can’t comment about Arkansas, except to ask something I’ve always wondered about: when a couple gets divorced in Arkansas, are they still brother and sister?
That only applies to Baptists. For the rest of us, we’re only guarenteed continued first-cousinhood.
Peter, startlingly enough you’ve managed to say quite a few things I agree with in the last few comments. Military bases around the world, farm subsidies, lavish entitlement programs and a great many other things could go, or be drastically cut. Let Europe look after its own security for a minute, and they would soon be a lot less smug about their cradle-to-grave social benefits, which have only been possible because U.S. taxpayers have relieved them of having to defend themselves. (Indeed, the wheels are coming off over there already, as the consequences of their immigration policies begin to bite.)
I agree also that a great many Republicans are conservatives in name only. They should be making sure their resumes are up to date.
As for that steamroller: we shall see soon enough.
And as for the President’s “solid” approval ratings, well there was this in my mailbox today, from James Taranto’s newsletter:
It’s a hard rain gonna fall, Pete.
I don’t want to get into dueling polls, but when an ideologue quotes an unidentified poll as his source, I get suspicious.
The latest NBC / Wall Street Journal poll, taken September 22-26, shows that Obama has a 47% positive rating, a 12% neutral rating, and a 41% negative rating.
His positive rating is well above the Republican Party (31%), Mitch McConnell (12%), and John Boehner (12%).
So no hard rain – maybe more like a sprinkler.
Well then Peter let’s switch from an “unidentified poll” to an ‘identified poll’ Larry Sabato’s “Crystal Ball.”
(A note from the text of the ‘Sixty Days Out’ prognosticating first:
“We’re proud of our record, with more than 98% of the contests called correctly over the decade-long life of the Crystal Ball.”
The link to the above:
http://www.centerforpolitics.org/crystalball/articles/ljs2010090201/
Now specifics from the September 30 post – first House:
http://www.centerforpolitics.org/crystalball/articles/itw2010093002/
Next, Senate and Governorships:
http://www.centerforpolitics.org/crystalball/articles/ljs2010093003/
I don’t know whether you looked in on the NWS Enhanced Doppler Radar Mosiac this morning Peter – but if you did, it looked more like a hard rain rather than a sprinkle.
The Dems may end up OK, or they may end up getting reamed. I think it will be somewhere in the middle. My point here is simply that thus far, Obama’s approval rating has held steady.
My guess is that 2010 and 2012 will be a replay of 1982 and 1984. In 1982, the unemployment rate was 9.8%, and the Republicans lost a lot of seats. In 1984, Reagan won a landslide reelection.
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