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This Week With Christiane Amanpour hosted an excellent debate this morning, with conservative pundit George Will and Congressman Paul Ryan on one side, and Congressman Barney Frank and Clinton Administration Labor Secretary Robert Reich on the other, over the fundamental, perennial issue of the optimum size and scope of government. First, please note that I did not frame it in the conventional way, with “small government” (SG) on one side, and “big government” (BG) on the other, because that is the frame created by SG advocates to mislabel their opposition. The real debate, as I see it, isn’t between SG advocates and BG advocates, but rather between SG advocates and advocates of “No Presumption Pragmatism” (NPP).

The legitimate concern is that NPP may tend toward limitless growth in government, but it is not therefore the case that those who are advocates of “no presumption pragmatism” are advocates of big government. Rather, it might be that there is an un-met challenge facing NPP that, if met, is a preferable path to either dogmatic SG advocacy or a careless, unrestrained-government growth version of NPP.

But there is an inherent tension between wanting government to perform an endlessly growing list of functions, and wanting government to be a minimalistic agent in our national affairs. ABC News’ John Donvan summed up that aspect of the debate nicely:

In the following introductory comments and opening salvos in this incarnation of The Debate, the participants lay out the parameters nicely, challenge some assumptions, redefine some positions, and offer some compelling insights and arguments:

Paul Ryan does an impressive job advocating his position, arguing that adhering to strict principals that generate optimal outcomes is superior to overreliance on government to take care of all challenges and address all issues, the latter error leading to a sprawling and cumbersome burden on human creativity and enterprise rather than an effective reduction in social problems and increase in human welfare. Barney Frank and Robert Reich respond that the government is too big in some ways and too small in others, and that reducing one’s position on the issue to an anti-government presumption fails to address the real challenges of managing a popular government.

Frank points out that many SG advocates are perfectly happy to rely on government to impose their will on others, advocating restrictions on women’s reproductive rights and a lack of definition of civil rights for gays and lesbians, while opposing the use of government in the productive manner of addressing “public goods” and “public bads,” not defined by arbitrary moral convictions, but rather by the real effects of our inevitable interdependence on our individual well-being. Reich reiterates that the question isn’t the size of government, but rather what factions of the population government is assisting or failing to assist.

Paul Ryan’s argument that smaller government is inherently more efficient and more effective than big government simply ignores the inevitable fact that any government function costs money, that, in a complex modern economy, there are a plethora of inescapable and quite expensive government functions that must be performed (e.g., regulating information-intensive markets such as financial and energy markets, which are easily gamed at potentially catastrophic public expense, but costly to monitor effectively); that the majority of the government programs targeted by SG advocates (with the notable exceptions of Social Security and Medicaid) actually involve piddling expenditures in relation to these large inescapable costs that government must be able to meet; that advocacy not to meet those inescapable costs is advocacy for a wildly self-destructive public policy; and that many of those piddling expenditures are in programs which research strongly demonstrates reduces far larger future costs that occur in their absence (such as those we currently incur in our enormous criminal justice system, far larger and more expensive, per capita, than those in other developed countries, incarcerating a far larger proportion of our population).

Since, in reality, there are expensive functions that a modern government must perform, and since, in reality, some social welfare programs have been strongly demonstrated to be cost effective over time, all things considered, what we as a polity really need to do in this debate is to transcend both the “big government is bad” platitude and the “every problem has a direct government solution” habit, and move into thinking more systemically, more intersectorally, and engage, in ever larger numbers with ever more commitment and knowledge, in the real challenge of using government as a disciplined and effective agent of our will, a portal into the organic processes of which we are a part, through which the essential functions of consciousness, of collective decision-making, of necessary oversight, of intentionality and value-driven intervention, can be implemented.

The debate in response to the audience question at the end over bailouts v. limiting the size of banks so that none are “too big too fail” is, as Robert Reich pointed out, an example of an information-intensive issue on which the relative positions of “conservatives” and “liberals” is not quite clear. The conservatives in this debate favored limiting the size of banks, while Frank on the liberal side argued that we require a different paradigm that allows for the existence of big banks in order to be internationally competitive. Though this Great American Debate historically began, in many ways, over a very similar question (should we have a national bank or not?), in its modern incarnation, it’s less ideological than technical, both sides admitting to the need to rely on economic analysis rather than blind ideology, neither side having the definitive solution to what is in reality a very complex problem.

The next segment deals with economic inequality and collective responsibility:

Elizabeth Warren’s introduction to this segment of the debate is, I believe, a very eloquent expression of the fundamental truth undermining the extreme SG/Libertarian argument: We are interdependent members of a single society, our political economy not being, never having been, and simply not capable of being, a mere market place for exchanges among atomized individuals, but rather an arena of coexistence in which some aspects of our shared lives are coordinated through market exchanges, but some aspects are necessarily coordinated in other ways as well.

These “extra-market” aspects of our shared existence aren’t just cultural, aren’t just a matter of family relationships and community relationships and voluntary organization memberships, but are also political and economic, involving our collective decision-making apparatus, our laws, and the ways in which a modern capitalist economy is populated with corporate actors whose own internal structure is hierarchical rather than “free market” based, and which wield enormous political power as a result.

The distribution of wealth and opportunity in America is clearly not a function of some mythical perfected meritocracy, but, as in all times and places throughout human history, is primarily a function of historical injustices reproduced through the chances of birth and the inherited opportunities and burdens that come with them. Our current legal system, evolved through periodic cleansings of the codification of those injustices, has certainly diluted the effects of those historical injustices, but their remaining legacy is clear to see, and is, in fact, a statistically undeniable current reality. Whatever policies we implement or decline to implement today, doing so with blithe disregard for the realities that currently exist is indefensible on both pragmatic and moral bases.

Paul Ryan’s response to Christiane’s opening question about economic inequality bordered on disingenuous: He blamed “current economic policies” for that growing disparity, despite the fact that the disparity has grown with the greatest acceleration, as it has in previous historical epochs, with the growth of deregulation and the success of SG political advocacy. This trend can clearly be seen in the three eras of most obscene concentration of wealth in America: The era of “The Robber Barons,” the “Roaring Twenties” of the Hoover Administration, and the current Reagan and post-Reagan era.

Ryan also, as he did throughout this debate (and as is an endemic deficiency in his ideological camp’s position), acted as if there is no other nation in the world with which we can compare our policies, to determine which kinds of policies really do increase social mobility and decrease economic inequality, and which ones really do exacerbate the lack of social mobility and the increase in economic inequality. The inconvenient fact is that a comparison to the social democracies of Western Europe and Canada demonstrates what the historical record I mentioned above also demonstrates: Social mobility is increased through social democratic government interventions in the economy, economic inequality is decreased, and prosperity is not undermined.

Paul Ryan argues that any attempt to decrease social inequality inevitably serves only to impoverish the wealthy rather than enrich the poor. This is an assumption and a fallacy. Historically, in fact, our political economic institutions have evolved in large measure to decrease social injustice (including economic inequality) without undermining the productive engine from which we all benefit. We’ve been successful enough at the latter goal that we consider merely slow growth to be economic failure, and periods of economic stagnation to be a crisis, and have, on average, maintained a fairly constant and sustained continuing growth in overall economic prosperity. While we’ve met that side of the challenge rather soundly, we not only have failed to address the increasingly inequitable distribution of the wealth thus created, but have actually devolved into a debate over whether we should care about that failure or not.

Ryan and Will represent the more “urbane” branch of their ideological movement, counterfactually insisting that their position decreases inequality and increases social justice, rather than that inequality and social injustice don’t matter. Unfortunately for Ryan and Will, the history of our own nation, and a comparison to other nations, demonstrate that the truth is the precise opposite of what they are claiming it to be.

Robert Reich added the observation that both the marginal tax rate on the wealthiest, and economic growth, were astronomically high under Dwight D. Eisenhower, debunking the assertion that they are antagonistic to one another.

George Will argues that Big Government always favors the wealthiest and most powerful, because it is most responsive to those who can pay expensive lobbyists and make large campaign contributions. Well, yes, government is skewed in favor of those with greatest political economic power, which is why the anti-government, deregulation movement has been so successful: It favors those with the greatest political economic power. To argue against using government to favor the interests of the less powerful on the basis that any government action is somehow inevitably going to favor the more powerful is a bizarre tautology, especially given the historical fact that disenfranchised groups have with some regularity successfully organized to gain power and legal protections throughout our history (e.g., women, African Americans, workers, environmental activists, etc.)

George Will then brought up the interesting observation that (therefore) the welfare state in America is primarily a transfer of wealth from the poorer young to the wealthier elderly (in the form of social security and Medicare). But this is a surprisingly sloppy representation, since neither the young nor the elderly are monolithic in their economic condition. I do agree, however, that social security and Medicare should be means tested; as a nation, we simply can’t afford to subsidize the wealthiest with public programs designed as safety nets.

But it is completely disingenuous to argue that the primary reason for that intergenerational disparity in wealth is due to Social Security and Medicare. The fundamental reason is insufficient government regulation of a market successfully exploited by a small minority of citizens over the course of their lives, such that they accumulate astronomical wealth by old age, creating the disparity that Will cites.

Ryan, however, made a potentially good point that Big Federal Government concentrated in Washington creates a convenient geographic and institutional nexus of power for corporate America to influence the political class. However, ironically, the policies that are most implicated in anti-BG advocacy are those policies that are most antagonistic to corporate interests, such as improved public health and safety standards, improved environmental standards, and expanded social services and programs for the neediest. The success of corporate lobbyists isn’t primarily the increase of government action to their benefit (though there is, of course, some of that), but rather the decrease of government action to their benefit (i.e., deregulation).

I do believe, however, that we need to move toward a paradigm of government facilitated public empowerment to carry out some of the functions currently embedded in governmental bureaucracies. Government can serve best to channel resources and pass legislation that will fund and guide local efforts. We need to think and act more systemically, in a more decentralized way, rendered coherent and conscious through our central agency of collective action (i.e., government), but utilizing all of the social institutional material on the ground in pursuit of social problem solutions and social institutional improvements.

The audience question that opens the next segment is very timely for me, since just yesterday I received my first “photo surveillance” ticket in the mail:

Paul Ryan’s repetition of the notion that economic equality automatically grows with economic growth is well answered by Barney Frank, who pointed out that economic growth is a necessary but not sufficient condition of wide-spread economic well-being

In fact, aggregate economic growth and economic equity (distributive justice, which is one aspect of social justice) are neither diametrically opposed nor perfectly compatible. There is a tension between them, in which some policies could indeed increase aggregate growth at the expense of distributive justice, some policies could increase distributive justice at the expense of economic growth, and some policies increase both economic growth and distributive justice at the same time. Obviously, the last category has the most to recommend it, but there are also times to accept trade-offs between aggregate growth and equitable opportunity to partake of the wealth produced by it.

As a thought experiment, consider the extremes: Few would support an arrangement by which one person accumulates ten times our current GDP every year, but everyone else is left in abject poverty. And, similarly, few would accept an arrangement in which there is absolute equality of abject poverty. There is clearly some balance to be struck between these two values.

Of course, Paul Ryan is right on target in the gist of his last remarks at the end of this segment: We need to end crony capitalism, eliminate subsidies to the rich, and address our economic challenges systemically. Those observations, however, do not belong to the larger ideological package that he is advocating, and, in the final analysis, are not compatible with it.

And on to the closing arguments:

Diminutive Robert Reich’s joke during his closing argument, reminding the audience that he has worked in government most of his life and then standing up and asking, “Do I look like Big Government to you?” struck me for a moment as funny but irrelevant, until I reflected on it a bit: Government is a human institution, comprised of human beings, acting in human ways. It is how we use it (and how we fail to use it), and what we do with it that defines its value. It is a vehicle of human will, not an external imposition, and it is, and should be, exactly as “big” as we are.

But, despite all of my arguments above, the take-home lesson from this debate, for everyone, should be that there is a legitimate debate to be had. From there, we can begin to acknowledge that no platitude suffices, and that the question is not one that can or should be answered with a slogan or reductionist philosophy. The responsibility of popular sovereignty, of self-governance, is that we govern ourselves wisely, succumbing to the manias and oversimplifications neither of the left nor the right. The more of us who take that step, who seek to transcend blind ideologies and embrace the challenge of being reasonable people of goodwill working together in a complex and subtle world, the better off we all will be.

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  • sblecher:

    Steve, I read several of your essays, and I share your views on a lot of topics, and indeed there is too little reason and good will these days. I’m a living fossil,I’m a (gasp!) moderate. I’m also and engineer, so I’m concerned with scientific method, process, analysis, and economics, so my view of the world is slightly different from yours, which appears to be more grounded in the social sciences. I will be making some more detailed comments shortly.

  • Thanks Steve. I appreciate your commenting.

    I’m surprised by your view of my orientation, since it is the precise opposite of my own. (Ideally, I think we should simply let the relative merits of various arguments speak for themselves. While there’s a place for categorizing arguments and orientations, more often than not it decreases rather than increases the “signal-to-noise ratio” http://coloradoconfluence.com/?p=1171.)

    If someone were to ask me “what values are most frequently reiterated in your essays,” one answer that would have been high on the list is “a commitment to scientific methodology.” Many posts are explicitly dedicated to the advocacy of applying such procedural discipline to the challenges of public discourse and popular sovereignty (see, e.g., “Ideology v. Methodology” http://coloradoconfluence.com/?p=1094, and “An Argument for Reason and Humility” http://coloradoconfluence.com/?p=2367), and most are infused with implicit advocacy of it.

    Also, I rely heavily on economic analysis (which is, by the way, a “social science”), having engaged for years in microeconomic analyses of social institutional systems and presenting papers to meetings of professional economists. There are seven explicitly economic essays in the sixth box at “Catalogue of Selected Posts” http://coloradoconfluence.com/?page_id=698, and a microeconomic form of analysis is found throughout most of my essays. The essay “Collective Action (and Time Horizon) Problems” http://coloradoconfluence.com/?p=1459, at the top of the third box, describes a basic game theoretic concept (game theory now being a branch of microeconomics) which permeates much of my social analysis. This is one of a set of interrelated economic concepts (transaction costs, information asymmetries, externalities, public goods and bads, etc.) that infuses much of what I write.

    While reason is not monolithic and does have multiple forms, for the most part, when we are talking about the kinds of analyses I write on this blog, we’re talking about a derivative of mathematical, or formal logical, reasoning (some combination of deduction and induction), the fundamental nature of which is not altered by the type of issue to which it is applied (though certainly some methodological adaptations must be made). Some systems are more complex than others, and that poses a slightly different set of challenges and tools, but, in all cases, we are talking about systems analysis.

    So I’m not sure I understand or recognize the reality of the distinction you are making between your orientation and mine. It doesn’t matter whether something is “economics” or “social science” or “engineering;” it only matters whether it is a deft application of sound reasoning to reliable data. There is indeed a large amount of “social science” which is very sloppy and “non-rigorous,” but I am a fervent critic of the modalities employed in such social scientific fluff. In fact, in my own complex dynamical social systems paradigm (found in the first box at “Catalogue of Selected Posts”), one of the recent refinements came via an analysis of technology from an engineering perspective (see The Evolutionary Ecology of Human Technology http://coloradoconfluence.com/?p=1660).

    But an engineering background certainly is different from mine, and no doubt provides another perspective on how best to analyze such systems. I look forward to reading your insights.

  • sblecher:

    Getting back to the debate, the topic was big government vs small government. Before there can be a proper discussion the terms need to be defined. The term,”big government” has unpleasant connotations, which is why conservatives use it so frequently. Big government is generally understood to mean the Federal government, which is based in Washington. The number of federal government workers has remained fairly constant for a number of years, so that’s not what really defines big government. Conservative politicians have often advocated transferring certain functions that are performed by the Federal government to the states. In general the states are too strapped for funds to assume those functions,but if states did assume them, the overall size of government would remain the same. What really determines the effective size of government is the a amount of funds it spends, and its broad regulatory powers. That’s why conservative politicians want to “starve the beast” by de-funding government programs, and special interests* fight regulation because that costs them money. The complexity of modern society has increased tremendously, and with it comes a need for more regulation in order to avoid chaos.
    *Not all special interests are politically conservative.
    Such is the context of the debate as I see it. More later

  • Steve, I agree with everything you wrote in your last comment.

    I would add that the “big government”/”small government” debate is overbroad. The real questions are: 1) What policies pass a long-time-horizon cost-benefit analysis of what we want government to do, all things considered (including the consequences of the answer to number 2, which can include the costs of accumulating debt, the direct and indirect costs of higher taxes to pay-as-we-go, and the opportunity costs of what those same resources were not spent on), and 2) How do we pay for those policies? That’s why I coined the term “No Presumption Pragmatism,” to capture this on-the-ground reality.

  • sblecher:

    Getting back to the debate, Robert Reich said,”Do I look like big government?” The answer from Ryan and Wills would be a resounding”Yes”, because the GOP considers regulation as synonymous with Big Government. Currently they are against all forms of regulation. Romney talks about “The invisible boot of Big Government”, whatever that means,and all the GOP candidates have a special hatred for the Environmental Protection Agency. Whenever they mention regulations they always use the term “job-killing regulations”. During the recent Republican “debates”, whenever the question of job creation comes up, they always respond by saying that regulations need to be abolished. Nobody has had the courage to ask any of them to explain in detail how eliminating regulations will create more jobs. The irony here is that the EPA was established during the Nixon administration. Of course Reagan famously said “Government is the problem.”, but in actual practice he wasn’t as dogmatic the present Republicans. Here’s an example: the EPA has finally decided to regulate emissions from old coal-fired power plants, especially mercury. This would appear to be a no-brainer and very much in the public interest, but the Republicans are trying to prevent it from ever being implemented. Will the power companies lay off employees if they have to install emission controls? Will they be hiring new employees if they don’t have to install that equipment? I don’t see how employment would be affected. The real answer is the companies that build the equipment would increase their sales, but the power companies will be able to charge their customers for the cost of the equipment The long-term payoff would be the improvement in public health and savings in health care expenses. PS, I just read your reply from yesterday afternoon and you anticipated some of the things I was preparing to say.

  • sblecher:

    I was originally planning to say something else, but I read the editorial in the Denver Post praising the the regulations designed to to eliminate mercury emissions from coal fired power plants. There are at least 15 comments thus far and I’m shaking my head in disbelief. At least half the writers were strongly opposed to the new regulations for a variety of reasons,such as:
    1)Colorado is not Minimata
    2)Just another excuse for government regulation.
    3) An Obama plot to raise the price of electricity sky high.
    4)Now we’ll have blackouts and brownouts.
    5) CFL bulbs already contain mercury
    6)The EPA always lies about the potential benefits of its rules.
    7)China doesn’t regulate mercury emissions, so why bother.

    The problem of mercury emissions was known for a long time, but the government intentionally chose not to do anything about it, because of opposition from coal companies and utilities. The power companies could have chosen to invest in emission controls, but that wouldn’t have added to their bottom line. The US is supposed to be a republic, democratically elected, so what kind of administration would knowingly let the people be poisoned?
    Now that corporations are people, maybe they can show more social responsibility, but I’m NOT advocating any form of socialism. Pollution in the “workers’ paradise”of the Soviet Union and eastern Europe was a lot worse than in the US. China today is an environmental disaster.
    A lot of US companies help protect the environment, but some are still regressive, and it shows that the market doesn’t always solve all problems.

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