Why Government Fails So Often: And How It Can Do Better (3 page)

Future economic growth
. The achievements of the United States that I described earlier constitute a record unparalleled in world history. But precisely because of our successful legacy, some question the nation’s ability to maintain, much less extend, these accomplishments in the face of remorseless challenges: global competition, implacable demographic changes, periodic financial and economic recessions, and rising public demands for more government intervention. Curing our daunting, interrelated pathologies—an embedded underclass, weak family structures, fiscally unsustainable entitlement programs, persistently mediocre (or worse) elementary and secondary education, growing inequality, a deteriorating infrastructure—demands many changes, some of which government policy alone cannot effect. But what we can and must demand of government is that its policies be cost-effective, a theme taken up in
chapter 2
. (Such discipline is not merely a domestic policy imperative. Mike
Mullen, then chairman of the Joint Chiefs of Staff, said that “the single, biggest threat to our national security is our debt.”
⁴¹
)

Is the United States capable of reforming its system in these ways? I think so (otherwise I would not have written this book) but, in truth, many informed, sympathetic observers harbor serious doubts. Consider for a moment just the business environment. The
Economist
, generally a staunch admirer of American economic institutions, notes that growing legal restrictions on financial transactions are making it “so difficult to list shares on an American stockmarket that firms increasingly look elsewhere or stay private. America’s share of initial public offerings fell from 67 percent in 2002 (when the Sarbanes–Oxley Act passed) to 16 percent last year. A study for the Small Business Administration, a government body, found that regulations in general add $10,585 in costs per employee. It’s a wonder the jobless rate isn’t even higher than it is.”
⁴²
Quoting comments by Harvard Business School faculty and alumni, the
Economist
observes, “The US government is failing to tackle weaknesses in the business environment that are making the country a less attractive place to invest and [is] nullifying some of American’s most important competitive strengths…. 71% [of HBS alumni] said that American competitiveness would decline in the coming years.”
⁴³
In June 2013, Niall Ferguson cited the United States’ dramatic decline since the mid-1990s in World Governance Indicators for voice and accountability, government effectiveness, regulatory quality, and control of corruption.
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Subsequent chapters will express similar doubts about many other aspects of government performance (or passivity, which of course is itself a policy).

Many commentators insist that the problem is partisan bickering and congressional paralysis. I have my doubts. Incivility in politics is a long American tradition,
⁴⁵
and many of the greatest governmental achievements of the past—the transcontinental railroad, the Hoover Dam, the interstate highway system—were accomplished only fitfully and after protracted disagreements, often appalling corruption, and political skulduggery.
⁴⁶
Partisan polarization, I think, is not so much a
cause
of our problems as a
consequence
of a central political reality
that has its virtues and its vices: the American people, from whom the partisan politicians take their cue, disagree fundamentally about many of the substantive directions that they want policy and institutional change to take—though as we shall see in
chapter 4
, this polarization is often exaggerated. To some extent, moreover, public division over which policies to support and in what forms reflects the fact that the problems are so difficult even to comprehend, much less to solve. Until the public somehow reaches greater consensus on these difficult policy issues—something that politicians even in the recent past have occasionally managed to forge for a time—we will be mired in a status quo that can only be altered by effective government reform of one kind or another. This, of course, is easier said than done—but it
has
sometimes been done in the past.
Chapter 11
provides some precedents for reform, and
chapter 12
discusses some possibilities for today.

Threats to government legitimacy
. The opinion data cited earlier indicates that the American people have dramatically less confidence and trust than they used to in the federal government’s propensity to do the right thing. This is very bad news not only for those who advocate new and innovative public initiatives but also for those who want to reform or repeal existing policies. It seems to bespeak a genuine feeling that the government cannot or will not do much well or right. (I say “seems” because the questions posed in these surveys do not usually invite respondents to distinguish in their misgivings among different policy choices.)

Does this widespread and growing mistrust of governmental morality (doing “the right thing,” whatever that might be) amount to a loss of its legitimacy? The answer to this important question depends on definition and degree. Some years ago, I cautioned against overuse of the concept, noting, “For many legal [and other] scholars, the invocation of legitimacy is not merely a handy rhetorical trope. It also serves as an indispensable prop, a kind of all-purpose, gap-filling,
deus ex machina
that we often use to rescue arguments that lack much empirical support or merely reflect our deeply-felt preferences.
We can all readily agree that any sound democratic regime must be perceived as legitimate in the sense that those subject to it accept and feel bound by its law
because
it is its law, quite apart from whether they agree with its merits.” In the specific context of affirmative action policy, I argued that when its advocates “insist that the policy is necessary to democratic legitimacy, what they really mean is that they feel very strongly about it. Their opponents, of course, feel just as strongly, yet this fact does not render laws authorizing [or prohibiting] affirmative action illegitimate.”
⁴⁷

At some point, to be sure, growing public suspicion of the government’s morality, motives, or competence might well produce widespread feelings of illegitimacy. This was illustrated most vividly in the public outrage over the abject failures of the Federal Emergency Management Agency in response to Hurricane Katrina.
⁴⁸
In my view, however, public doubts about the government’s effectiveness and ability to do the right thing,
⁴⁹
and do it reasonably well, do not yet amount to a perception of illegitimacy (although some astute commentators disagree
⁵⁰
). Nevertheless, it does pose a growing danger, like rising floodwaters threatening to breach a levee. It is also sobering to recall, as Paul Light does, that there have been two periods in recent history—during the administration of president Ronald Reagan, and in the months following 9/11—when trust has rebounded but then fallen back.
⁵¹
Today, as noted above, trust in the federal government is lower than ever before. Given the unusually difficult political and policy challenges that it faces today and for the foreseeable future, such trust will be difficult, though not impossible, to regain. A relatively new development that supports this downbeat prediction is this: presidents and other elected officials on both sides of the aisle (albeit more often Republicans) no longer content themselves with merely disparaging this or that public policy; they now lead the chorus of systemic criticism of government competence and capacity.
⁵²
More speculatively, increasingly well-educated, well-traveled, and technologically sophisticated citizens may be more receptive to such systemic criticisms of government as they hold it to
ever higher standards of professional ethics, wise policy making, and efficient administration.

Even if the current level of dissatisfaction falls short of widespread loss of legitimacy, it still constitutes a serious challenge to effective governance. It means not only that citizens hold low expectations of the government (which, after all, should be easier to satisfy), but also that the public is less willing to provide government with the authority, support, resources, and patience that effective policy making may require. Political scientist James Morone has chronicled the historical cycle of public dissatisfaction with government performance: discontent, demands for reform, and enactment of new policies, followed by fresh disappointment. He argues that the public’s chronic suspicion of governmental power, a signal feature of American political culture going back to colonial times, has engendered a self-fulfilling prophecy: suspicious voters resist providing the government the power and resources that are necessary, in Morone’s view, for the kind of successful, effective programs that could have reversed this mistrust and disrespect of government.
⁵³

There is little doubt that the perpetual despair–reform–despair cycle that Morone describes has confirmed, and likely increased, public resistance to large new policy initiatives. President Barack Obama’s signature Affordable Care Act of 2010, far from refuting this claim, actually confirms it. In a heavily Democratic Congress, it survived a filibuster by one vote and its popularity began to plummet practically before the ink from the presidential pens was dry. As I write more than three years later after an election that returned Obama to office with a Senate controlled even more firmly by his party, many states continue to resist the new policy by failing to establish the mandated insurance exchanges and Medicaid expansions,
⁵⁴
and public opinion about the act grows increasingly negative as full implementation unfolds.
⁵⁵

This resistance to grandiose public initiatives seems endemic to our time.
New York Times
columnist David Brooks has contrasted the New Deal era, when a desperate public actually believed that the
federal government could solve big problems, with the current public’s weary cynicism.
⁵⁶
As noted earlier, a large majority of Americans view big government as a larger threat to the country’s future than even big business—and this only a few years after misconduct by major financial firms brought the economy to its knees.
⁵⁷
This state of mind could be fatal to the kind of “public spirit” that political scientist Steven Kelman thinks is essential to sound policy making.
⁵⁸
In short, all citizens have a vital stake in improving government’s performance, but none more so than liberals and progressives deeply committed to bolder public undertakings.

Tellingly, federal policy intervention has increased over the same period during which public mistrust of government has risen. Contrary to what growing public disaffection might imply, the threshold for intervention is markedly
lower
today than it was as recently as fifty years ago. Long before the Dodd-Frank and Affordable Care Acts were passed, political scientists James Q. Wilson and John DiIulio noted the change:

The Old System had a small agenda…. When someone proposed adding a new issue to the public agenda, a major debate often arose over whether it was legitimate for the federal government to take action at all in the matter…. For the government to take bold action under this system, the nation usually had to be facing a crisis…. Each succeeding crisis left the government bureaucracy somewhat larger than it had been before, but when the crisis ended, the exercise of extraordinary powers ended…. The New System … is characterized by a large policy agenda, the end of the debate over the legitimacy of government action (except in the area of First Amendment freedoms), the diffusion and decentralization of power in Congress, and the multiplication of interest groups…. Under the Old System, the checks and balances made it difficult for the government to
start
a new program, and so the government remained relatively small. Under the New System, these checks and balances make it hard to
change
what the government is already doing, and so the government remains large.
⁵⁹

These institutional and attitudinal changes, then, place far greater demands today on a government already prone to policy failure and lacking the public’s confidence. As we shall see, the deep, systemic
causes of programmatic failure cast great doubt on the claim by commentators like Morone that more authority and resources would enhance governmental performance commensurately.

Indeed, the trajectories of public confidence and federal expenditures have moved in opposite directions. More specifically, the decline in public confidence has paralleled a large growth in the share of federal expenditures devoted to safety net programs, especially for health care.
⁶⁰
This correlation is a strong and consistent one. Whether the correlation between more government and less public confidence is causal is harder to say: Medicare, for example, has accounted for much of that budgetary growth, yet it enjoys very widespread public support. Likewise, as columnist Ezra Klein observes, the decline of confidence in government seems unrelated to the increase of money in politics (discussed in
chapter 7
).
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