Why Government Fails So Often: And How It Can Do Better (70 page)

77
. Peter H. Schuck & James Q. Wilson, “Looking Back,” in Schuck & Wilson,
Understanding America
, 628–29.

78
. Morris P. Fiorina, Samuel A. Abrams, & Jeremy C. Pope,
Culture War? The Myth of a Polarized America
(2d ed., 2006). They reply to their critics, Alan I. Abramowitz & Kyle L. Saunders, in Fiorina, Abrams, & Pope, “Polarization in the American Public: Misconceptions and Misreadings,”
http://sitemason.vanderbilt.edu/files/cARwUU/Fiorina.pdf
.

79
. Schlozman et al.,
The Unheavenly Chorus
, 236–60.

80
. Bill Bishop,
The Big Sort: Why the Clustering of Like-Minded Americans Is Tearing Us Apart
(2009)

81
. Jed Handelsman Shugerman, “The Twist of Long Terms: Judicial Election, Role Fidelity, and American Tort Law,”
Georgetown Law Journal
98 (2010): 1351.

82
. Stephen G. Breyer,
Breaking the Vicious Circle: Toward Effective Risk Regulation
(1993).

83
. Paul M. Darden, David M. Thompson, James R. Roberts, Jessica J. Hale, Charlene Pope, Monique Naifeh, & Robert M. Jacobson, “Reasons for Not Vaccinating Adolescents: National Immunization Survey of Teens, 2008–2010,”
Pediatrics
131 (2013): 645–51; Dennis K. Flaherty, “The Vaccine-Autism Connection: A Public Health Crisis Caused by Unethical Medical Practices and Fraudulent Science,”
Annals of Pharmacotherapy
45 (2011): 1302–4. For the populist view on the vaccine-autism issue, see Louise Kuo Habacus & Mary Holland, eds.,
Vaccine Epidemic: How Corporate Greed, Biased Science, and Coercive Government Threaten Our Human Rights, Our Health, and Our Children
(2011).

84
. See, generally, Peter L. Strauss, Todd D. Rakoff, Cynthia R. Farina, & Gillian E. Metzger, eds.,
Gellhorn and Byse’s Administrative Law: Cases and Comments
, 11th ed. (2011).

85
. Walter Lippman,
Public Opinion
(1922).

86
. John J. DiIulio Jr., “Facing Up to Big Government,”
National Affairs
, Spring 2012, 9.

87
. Robert D. Putnam,
Bowling Alone: The Collapse and Revival of American Community
(2000).

88
. Nancy L. Rosenblum, “Good Neighbor Nation: The Democracy of Everyday Life in America” (unpublished manuscript, 2013).

89
. This passage is taken from Schuck & Wilson, “Looking Back,” 630–31, which in turn draws on Wuthnow, “Religion.”

90
.
See, generally, Arthur C. Brooks, “Philanthropy and the Non-Profit Sector,” in Schuck & Wilson,
Understanding America
, chap. 18.

91
. See, e.g., Robert Pear, “U.S. Clarifies Policy on Birth Control for Religious Groups,”
New York Times
, March 16, 2012. The litigation is
University of Notre Dame v. Sibelius
, No. 312CV253RLM, 2012 WL 6756332 (N.D. Ind. December 31, 2012). See also,
Gilardi v. U.S. Dept. of Health and Human Services
, D.C. Cir., November 1, 2013.

92
. Laurie Goodstein, “Illinois Bishops Drop Program over Bias Rule,”
New York Times
, December 29, 2011.

93
. James Piereson, “How Big Government Co-opted Charities,”
Wall Street Journal
, July 18, 2013.

94
. See, e.g., Marvin Olasky,
The Tragedy of American Compassion
(1992); and Theodore Dalrymple,
Life at the Bottom: The Worldview That Makes the Underclass
(2001).

CHAPTER 5: INCENTIVES AND COLLECTIVE IRRATIONALITY

1
. For one synthesis of these studies, with bibliographical references, see James Q. Wilson & John J. Dilulio Jr.,
The Essentials of American Government: Institutions & Policies
, 12th ed. (2011).

2
. Nicholas R. Parrillo,
Against the Profit Motive: The Salary Revolution in American Government, 1780–1940
(2013).

3
. Kelman,
Making Public Policy: A Hopeful View of American Government
(1987), 239–40.

4
. Lee Epstein, William M. Landes, & Richard A. Posner,
The Behavior of Federal Judges: A Theoretical and Empirical Study of Rational Choice
(2013).

5
. For a penetrating review of the public choice literature, see Terry M. Moe, “Delegation, Control, and the Study of Public Bureaucracy,”
The Forum
10 (2012): 1–45.

6
. For a revealing discussion of the theory’s strengths and weaknesses, see the review (by a proponent of the theory) of a book that alternately criticizes and uses it: Jonathan R. Macey, “Public Choice and the Legal Academy,”
Georgetown Law Journal
86 (1997–98): 1075–91 (reviewing Jerry L. Mashaw,
Greed, Chaos, and Governance: Using Public Choice to Improve Public Law
[1997]).

7
. See, e.g., Donald P. Green & Ian Shapiro,
Pathologies of Rational Choice Theory: A Critique of Applications in Political Science
(1994); and Mashaw,
Greed, Chaos, and Governance
.

8
. Steven A. Morrison & Clifford Winston,
The Economic Effects of Airline Deregulation
(1986).

9
. The authoritative account is Martha Derthick & Paul J. Quirk,
The Politics of Deregulation
(1985). For a public choice theory explanation of the legislation, see Macey, “Public Choice and the Legal Academy,” 1080.

10
. Its budget in 2008 was an estimated $10 billion, with estimated annual operating costs of $1 billion. Barry Nield, “CERN’s search for Higgs Boson God Particle Is among Most Expensive Science Ever,”
http://www.globalpost.com/dispatch/news/regions/europe/120704/cerns-search-higgs-boson-god-particle-among-most-expensive-scien
. One might argue against this example on the ground that these costs were funded largely by other governments, not the United States, but public choice theory presumably would resist such a distinction. After all, vote-seeking politicians should behave pretty much the same in all democracies, mutatis mutandis.

11
. William J. Broad, “So Far Unfruitful, Fusion Project Faces a Frugal Congress,”
New York Times
, September 30, 2012.

12
. James Madison, “Federalist No. 51.”

13
.
See, generally, Elinor Ostrom,
Governing the Commons: The Evolution of Institutions for Collective Action
(1990).

14
. On signaling theory and rational self-interest, see Eric Posner,
Law and Social Norms
(2000).

15
. See, e.g., Tracey E. George, “Developing a Positive Theory of Decisionmaking on U.S. Courts of Appeals,”
Ohio State Law Journal
58 (1998): 1651.

16
. See Jonathan Rauch, “Was Mancur Olson Wrong?”
The American
, February 15, 2013,
http://www.american.com/archive/2013/february/was-mancur-olson-wrong
(review of Gunnar Trumbull,
Strength in Numbers: The Political Power of Weak Interests
[2013]).

17
. On the policy response to the financial crisis, see Roberta Romano, “Regulating in the Dark,” in Cary Coglianese, ed.,
Regulatory Breakdown: The Crisis of Confidence in U.S. Regulation
(2012), chap. 5.

18
. See, generally, David Schoenbrod, “Government without Tricks” (manuscript in preparation),
http://www.governmentwithouttricks.org
.

19
. Edward Wyatt, “Backer of an Open Internet Steps Down as F.C.C. Chief,”
New York Times
, March 22, 2013.

20
. Brian Galle, “The Tragedy of the Carrots: Economics and Politics in the Choice of Price Instruments,”
Stanford Law Review
64 (2012): 797–850.

21
. Jonathan Rauch,
Government’s End: Why Washington Stopped Working
(1999).

22
. This dynamic has been elaborated upon in James M. Buchanan & Gordon Tullock,
The Calculus of Consent: The Logical Foundations of Constitutional Democracy
(1962).

23
. John Ferejohn, “Logrolling in an Institutional Context: A Case Study of the Food Stamp Legislation,” in Gerald C. Wright, Leroy N. Rieselbach, and Lawrence C. Dodd, eds.,
Congress and Policy Change
(1986), chap. 9.

24
. Jim Monke,
Budget Issues Shaping a Farm Bill in 2013
, Congressional Research Service Report R42484 (2013), 3; Marlin Stutzman & Michael Needham, “The ‘Farm’ Bill Is No Such Thing,”
Wall Street Journal
, August 2, 2012.

25
. Raymond Hernandez, “Congress Approves $51 Billion in Aid for Hurricane Victims,”
New York Times
, January 28, 2013.

26
. David A. Moss,
When All Else Fails: Government as the Ultimate Risk Manager
(2002), chap. 10.

27
. Ibid., 327.

28
. See, generally, Matthew Richardson,
Guaranteed to Fail: Fannie Mae, Freddie Mac, and the Debacle of Mortgage Finance
(2011).

29
. Alex J. Pollock, “We Don’t Need GSEs,” testimony before the House Financial Services Committee, June 12, 2013,
http://financialservices.house.gov/uploadedfiles/hhrg-113-ba00-wstate-apollock-20130612.pdf
.

30
. Dwight Jaffee & John M. Quigley, “The Future of the Government Sponsored Enterprises: The Role for Government in the U.S. Mortgage Market,” in Edward L Glaeser & Todd M. Sinai, eds.,
Housing and the Financial Crisis
, 361–417 (Chicago: University of Chicago Press, 2013).

31
. Nick Timiraos, “Fannie’s Windfall Blurs Debate over Its Fate,”
Wall Street Journal
, April 3, 2013; Gretchen Morgenson, “Mortgages’ Future Looks Too Much Like the Past,”
New York Times
, March 24, 2013.

32
. Edward Kane, quoted in Gretchen Morgenson, “Seeing Bailouts through Rose-Colored Glasses,”
New York Times
, May 20, 2012.

33
. Robert C. Posen, “The Future of Home Mortgages in the U.S.,” Brookings Research, August 6, 2013.

34
. Robert J. Shiller, “Owning a Home Isn’t Always a Virtue,”
New York Times
, July 13, 2013.

35
. Benjamin M. Friedman, “How Americans Face Risk,”
New Republic
, August 5, 2013, 55.

36
. Jessica Silver-Greenberg & Nelson D. Schwartz, “Federal Regulators Make Public the ‘Living Wills’ of Nine Too-Big-to-Fail Banks,”
New York Times
, July 4, 2012.

37
.
Michael R. Crittenden, “Challenges in Bid to Revamp Banks,”
Wall Street Journal
, July 18, 2013.

38
. “The Financial Instability Council,”
Wall Street Journal
, July 16, 2013; Peter J. Wallison, “The FSOC Expands ‘Too Big to Fail,’ ”
The American
, July 18, 2013,
http://american.com/archive/2013/july/the-fsoc-expands-too-big-to-fail
.

39
. See Gretchen Morgenson, “One Safety Net That Needs to Shrink,”
New York Times
, November 4, 2012; and Gretchen Morgenson, “Don’t Blink, or You’ll Miss Another Bailout,”
New York Times
, February 17, 2012 (on the bailout in the form of releasing Bank of America from legal claims against it for mortgage-related fraud).

40
. Floyd Norris, “Shades of 2007 Borrowing,”
New York Times
, May 31, 2013.

41
. Congressional Budget Office,
FairValue Accounting for Federal Credit Programs
,
http://www.cbo.gov/sites/default/files/cbofiles/attachments/03–05-FairValue_Brief.pdf
.

42
. Committee on Education and the Workforce, U.S. House of Representatives,
Examining the Challenges Facing PBGC and Defined Benefit Pension Plans: Hearing before the Subcommittee on Health, Employment, Labor and Pensions
, 112th Cong. 3–4 (2012) (statement of Joshua Gotbaum, Director of the Pension Benefit Guaranty Corp); Ivan Osorio, “Benefit Guaranty Corporation’s Real Crisis,”
Forbes
, February 22, 2012,
http://www.forbes.com/sites/realspin/2012/02/22/the-pension-benefit-guaranty-corporations-real-crisis/
.

43
. Erwann Michel-Kerjan & Howard Kunreuther, “Paying for Future Catastrophes,”
New York Times
, November 25.

44
. Lizette Alvarez & Campbell Robertson, “Cost of Flood Insurance Rises, Along with Worries,”
New York Times
, October 12, 2013.

45
. See Bert Ely, “Savings and Loan Crisis,”
http://www.econlib.org/library/Enc/SavingsandLoanCrisis.html
.

46
. Eric Lipton, Felicity Barringer, & Mary Williams Walsh, “Flood Insurance, Already Fragile, Faces New Stress,”
New York Times
, November 13, 2012; Justin Gillis & Felicity Barringer, “As Coast Rebuilds and U.S. Pays, Repeatedly, Critics Ask Why,”
New York Times
, November 19, 2012; Erwann Michel-Kerjan & Howard Kunreuther, “Paying for Future Catastrophes,”
New York Times
, November 25, 2012.