Our Mindless Government Is Heading for a Spending Disaster
If the government that governs least governs best, then the government that governs via a demented form of “scientific management” and “legal assembly line” governs worst.
That’s the essential insight of Philip K. Howard’s important new book, The Rule of Nobody: Saving America From Dead Laws and Broken Government. An attorney by trade, Howard is the author of The Death of Common Sense: How Law Is Suffocating America, a huge 1995 best seller that started a still-heated and vital national conversation about nuisance lawsuits, power-tripping bureaucrats and special interests, and out-of-control regulations. He also heads up Common Good, a nonprofit seeking to “overhaul governmental and legal systems to allow people to make sensible choices.”
The Rule of Nobody updates and expands Howard’s original brief, and it helps to explain why government at all levels not only is on autopilot but on a flight path that can only end in disaster. As he told me in a recent interview, he’s no rock-ribbed libertarian (pity!), but an old-fashioned, plain-vanilla centrist in every possible way. (Common Good’s board has included the likes of George McGovern and Alan Simpson, Bill Bradley and Tom Kean.) Which only makes Howard’s basic argument that much more difficult to wave away as some sort of ideologically motivated attack against past, present, or future occupants of the White House.
How does “automatic government” stultify things? Consider what Howard calls the “Bayonne Bridge episode.” The 83-year-old “architectural masterpiece” in question spans the colorfully named Kill Van Kull and connects New York Harbor with the Port of Newark, the busiest port on the East Coast. A few years back, the Port Authority of New York and New Jersey, the generally risible agency intimately involved with Gov. Chris Christie’s political future (or lack thereof), realized that modern container ships designed to take advantage of the enlarged Panama Canal wouldn’t be able to fit under the bridge’s 151-foot clearance. The Port Authority figured a brand-new bridge or tunnel—costing a whopping $4 billion of money nobody had—was the only way forward. Then a smart project manager came up with the idea of raising the roadway on the existing bridge by about 100 feet. That would not only do the trick but save $3 billion in the process. So far, so good.
“That was 2009,” writes Howard. “At the beginning of 2013, the Port still lacked approval to start construction. Who, you might reasonably ask, has the authority to approve a project like this?” The answer is basically no one, at least not in “a deliberate or timely way.” At a minimum, the project requires 47 permits from at least “19 different governmental entities,” including an environmental review by the Environmental Protection Agency that is both redundant of existing information and a total time-suck given the relatively modest alterations involved. Just “finding a lead agency [to start the review] took almost one year.” Even President Obama—who designated the bridge revamp as one “seven essential port infrastructure projects” and who oversees the EPA—was powerless to speed things up. It remains far from clear that the project will be completed by 2015, when the new and improved Panama Canal opens for business and the bigger and taller container ships start sailing the ocean blue.
“Under current orthodoxy,” writes Howard, “the ideal government runs like a software program: Input the facts and out comes a decision.” While stressing that such a “technocratic model...has many plausible virtues” and evolved as a way to combat favoritism and partisan whimsy, he convincingly argues that contemporary government has removed virtually all scope for human intervention and responsibility. The result isn’t a fairer, more predictable form of government, but “a form of tyranny,” says Howard. “The fact that the tyrant is a bureaucratic blob instead of Birmingham police chief Bull Connor means that our freedom is smothered instead of subjugated at the point of a weapon.”
I don’t buy the extreme version of Howard’s argument, at least at the federal level. Like President George W. Bush before him, Obama has shown both the ability and willingness to act unilaterally—and even unconstitutionally—when it suits his fancy. As my Reason colleague Jacob Sullum has noted, Bush illegally used Troubled Asset Relief Program funds to bail out GM and Chrysler. Obama expanded the auto bailout while also dropping bombs on Libya and persistently rewriting his own health-care law, all without necessary congressional approval. There’s every reason to believe that whoever wins the 2016 presidential race will at least dabble in Caesarism, too.
But there’s no question that Howard is essentially right when he talks about government that is largely beyond the control of anyone, especially on spending. The federal budget is split into two large categories known as “discretionary” spending and “mandatory” spending. Discretionary spending comes up every year for renewal; the biggest-ticket item in that category is the defense budget. Mandatory spending includes entitlement programs such as Medicare, Medicaid, and Social Security, as well as other social-insurance programs such as food stamps and veterans’ benefits. It doesn’t need to be renewed each year and generally is not subject to the sorts of spending caps that at least theoretically limit discretionary outlays.
In 2013, fully 60 percent of federal outlays came in the form of mandatory spending. In 1962, before the creation of Medicare and Medicaid, let alone Obamacare, mandatory spending accounted for less than 30 percent of federal spending. Within a decade, it will top 70 percent of federal outlays, if current trends continue. There is, needless to say, nothing truly mandatory about it. Medicare isn’t some fact of nature but the creation of politicians who at can change or abolish it any time. At the state and local level, more and more outlays are governed by rules dictating minimum funding guarantees, such as California’s formula for school funding) or payouts to public-sector pensioners.
It’s clear why politicians like “mandatory” spending: It absolves them of any real responsibility while also shoveling heaping servings of cash to high-turnout voters. For all the rancor in D.C., neither Democrats nor Republicans show the least bit of interest in seriously tackling entitlement reform or shifting “mandatory” spending into “discretionary” funding, where it would come up for an annual and on-the-record vote.
Of course, the problem is that putting increasing amounts of spending, including increasing amounts of automatic increases in spending, on autopilot means that governments can’t deal with changed circumstances. Does anyone seriously think that the need for and structure of Social Security—created during the Great Depression, for god’s sake, and at a time when there were 160 workers per beneficiary—is relevant to 21st-century America, in which households headed by seniors have 47 times the wealth of households headed by people under 35 years old?
With the possible exception of Juice Box Mafia button man Matthew Yglesias, safely ensconced in the journalistic rubber room that is Vox, all analysts, politicians, and observers agree that unchecked growth federal spending and the increases in debt it presumes pose a serious threat to the economic viability of the United States. Paul Krugman does, and so does Obama, who in the fall of 2008 was still campaigning on a “net spending cut.”
The Rule of Nobody envisions “a shift in values—away from automatic government and toward a structure that allows humans to make choices needed to adapt to local need and global challenges.” Well, here’s hoping. Howard proposes a series of constitutional amendments that he says would flip the autopilot off and reinvigorate the sorts of reforms we need to avoid looming disaster. Some of these are more compelling than others—certainly it’s a great idea to create mandatory sunsets on “all laws and programs with budgetary impact”—but all are worthy of discussion.
Bankrupt cities and states are starting to challenge the inviolability of budget-busting pension guarantees, the Fed is winding down QE-Whatever, and there’s simply no way that entitlements as we have known them will survive the next few decades. (The Social Security retirement trust fund is already paying out more than it takes in on an annual basis, and Medicare is set to double not just its number of recipients but the annual payout per beneficiary by 2040.)
Howard is far from alone in noting that “big change is inevitable.” The only question is whether we will manage it proactively or reactively. And whether the Bayonne Bridge project will be completed on time.