Arnold Kling  

Why the U.S. is Ungovernable

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Attention: Liberals and Progr... The "Zero-Probability Fallacy"...

It's the latest meme. The U.S. is ungovernable, because of
a) Senate procedures
b) Republican obstructionism
c) polarization
d) special interests
etc.

I've seen it from Marc Ambinder, Steven Pearlstein, and others. I'm too lazy to copy links, but my guess is that you have seen it, too.

I want to offer my own theory of why the U.S. has become ungovernable. It basically comes from the second chapter of my latest book, Unchecked and Unbalanced, which as I write this is number 247,076 on the Amazon best-seller list.

The theory is that there is a discrepancy between trends in knowledge and power. Power in the United States is remarkably concentrated. We are creating increasingly specialized knowledge, which means that the information needed to make good decisions is located outside of Washington, D.C. And yet we have a central government attempting to do for 300 million people what governments in places like Singapore, Hong Kong, Denmark, and Switzerland do for many fewer people.

I do not wish to contend that government is better in those countries than in the U.S. But if there were scale efficiencies in government services beyond the level of 10 million people, then we would expect governments in small countries to be much, much worse than in the U.S. The fact that Singapore, Hong Kong, Denmark, and Switzerland function at all is proof that a 300-million scale polity is not necessary to run an effective social insurance system, an effective education system, etc.

There are two reasons that I would like to see government functions devolved to state and local levels. First, I would like to see more experiments and more variety. Instead of having a big national contest over what health care system, why not try single-payer in one part of the country and radical deregulation in another? Switzerland, which is about the size of Maryland, has different health care systems in each of its 20-odd cantons, which are about the size of Maryland counties. Surely it must be possible to try different health care approaches in Texas and Massachusetts.

The second reason is to bring about greater equality in political power. Power at the national level creates extreme inequality between the few who hold office and the rest of us who do not. Basically, we can vote in elections, and that is it. With power more localized, we have a greater chance of holding office or having influence as voters. More important, we could "vote with our feet" by moving to jurisdictions that suit our preferences.

In fact, I think that we could make competition in government even easier. For many purposes we could replace physical jurisdictions with virtual ones. That way, my neighbors could belong to a jurisdiction that has single-payer health care, while I belong to a jurisdiction with a more libertarian approach.

These days, most of the people who complain that the U.S. is ungovernable are looking for solutions that would allow progressive technocrats to be even more powerful. I believe that the solution is to decentralize government, so that the U.S. becomes a federation of hundreds of Swiss-style cantons, each of which can be governed differently, but reasonably effectively.


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COMMENTS (42 to date)
fundamentalist writes:

"These days, most of the people who complain that the U.S. is ungovernable are looking for solutions that would allow progressive technocrats to be even more powerful."

Exactly! They consider the rest of us too stupid to poor water out of a boot before putting it on. They are convinced that only a "progressive" elite can make the right decisions and that those enlightened decisions must be forced upon the rest of us because we are too stupid to see how brilliant they are.

david writes:

I doubt there would be a Singapore if ASEAN had an interstate commerce commission guaranteeing labor mobility within the region (while Singapore does use a great deal of foreign labor - nearly a quarter of the population - it also feels zero compulsion to allow them to stay. Singapore unemployment remained stable at 3% throughout this last recession, in large part due to retrenching foreigners).

More generally, if you want "more experiments and more variety", you will have to devolve more fiscal and monetary powers to the states. And states will feel zero compulsion to encourage free mobility and choice of regime. Why would they?

States don't want a race to the bottom, however much libertarians might wish for it.

David writes:

Maybe we need to try a central government of specific, enumerated powers. Create a document that spells out those powers, and then put in a statement to the effect that "the powers not delegated to the United States by [this document], nor prohibited by it to the States, are reserved to the States respectively, or to the people". Would that be worth a try?

Robert writes:

This will sound silly, but the one anecdote swayed me into believing that the filibuster is a terrible procedure was a quote from Alexander Hamilton that Ezra Klein found:

"It has been shown, under the second head of our inquiries, that all provisions which require more than the majority of any body to its resolutions, have a direct tendency to embarrass the operations of the government, and an indirect one to subject the sense of the majority to that of the minority. ... The history of every political establishment in which this principle has prevailed, is a history of impotence, perplexity, and disorder. Proofs of this position might be adduced from the examples of the Roman Tribuneship, the Polish Diet, and the States-General of the Netherlands, did not an example at home render foreign precedents unnecessary."

I am open to Arnold's view, but I would like to see whether other successful countries require a 60% majority.

I don't think the US government would be perfect absent a filibuster but I think it would be slightly better than it is now. I imagine if Bush II hadn't had to deal with a filibuster that we would already have health care vouchers and a privatized social security system. And then maybe Obama would have changed that again.

Eliminating the 60% majority requirement would be another way to have persistent experimentation.

eccdogg writes:

This is exactly my thought.

Many if not most US states are as big as European countries. Devolving power to the states and even localities makes a ton of sense.

You do have to contend with immigration issues though, but it seems like those could be mitigated in several ways.

First I think the problem is overstated. You don't see a ton of people moving to MA to get health insurance.

Second, there are several mechanisms that could be put in place to deter people from moving in to take advantage of say free medicine. One way would be to require a time of residency restriction so that you would not be eligible for benefits until you lived in the state 3 years. Many states already do this for in state tuition at universities.

Continued gridlock at the federal level would seem to drive this more and more as states decide it is up to them if they want certain policies.

Peter Twieg writes:

Two excellent posts in a row, Arnold. Awesome.

I noted something similar when I observed that the cover story in the latest Atlantic on the problems of American government focused largely on the "ungovernability" issue but failed to mention the word "federalism" a single time. I think most progressives consider the concept antiquated.

Fenn writes:

Pretty good to crack the top 250K selling 100 pages at 30 bucks (21.xx on Amazon). I assumed with that price, academic libraries were your target. Of course books should be judged are their ideas, not their heft, and after reading the first few chapters of Sowell's I am glad I was able to pick yours up after Amazon was late with a couple Prime shipments and gave me 20 bucks in credit.

I'll give it to the city library after I read it.

Doc Merlin writes:

1) Free people don't need a leader.

2) "In fact, I think that we could make competition in government even easier. For many purposes we could replace physical jurisdictions with virtual ones. That way, my neighbors could belong to a jurisdiction that has single-payer health care, while I belong to a jurisdiction with a more libertarian approach."

Excellent idea! David Friedman and other ancaps have been pushing for this for a long time. Effectively what it does is lower the transaction costs of leaving a bad jurisdiction.

3)"And states will feel zero compulsion to encourage free mobility and choice of regime. Why would they?"

This is the one thing that a federal government does well is keep the states from putting tariffs on each other's good and preventing travel between them. Imo this and mutual defense are the only good purposes of a federal government.

Dan Weber writes:

First, I would like to see more experiments and more variety. Instead of having a big national contest over what health care system, why not try single-payer in one part of the country and radical deregulation in another?

This still needs Federal action. If one state operates a successful universal health care system, they can get a flood of sick immigrants who bring more costs than revenue, and the states cannot deny care to new immigrants.

So we should be actively lobbying for giving states the freedom to treat new immigrants differently WRT their health care system.

chipotle writes:

Arnold,

If you want to do politics, learn to lie tactfully.

If you straightforwardly tell the people who HAVE power that you want to disempower them, what do you suppose their response will be?

Better to tell them you have a proposal that will solve all our problems AND maintain the status quo vis-รก-vis the political balance-of-power.

If they believe a reform is to their advantage, they just might try it.

John Fast writes:

I agree that the discrepancy between knowledge and power is a severe problem -- but the most important problem is the discrepancy between responsibility and authority.

If politicians and bureaucrats were rewarded and punished based on performance, they would solve the knowledge problem in a heartbeat (presumably by devolving power back to states, local governments, private charities and businesses, and individuals; but if you think there's a better solution just insert it here).

If I understand Bryan Caplan he disagrees: instead, he agrees with Donald Wittman that we have solved the principal-agent problem pretty well. (That's something I plan to do a paper on.)

Steve Y. writes:

A thoughtful post.

Concerning the ungovernability meme, I'm under the impression that it resurfaces whenever Democrats achieve power (not 51-49, but in the 60-40 range), run into difficult problems, and can't credibly blame the opposition. No one talks about ungovernability when a Republican Congress and a Republican Executive are stymied (e.g., Social Security reform, judicial appointments)

Democrats have controlled both houses of the California legislature since 1996. Our State is a fiscal basket case, and we regularly hear calls to break up the State because--echoing your point about the Federal Government--it's too big and ungovernable.

Well, then, why doesn't this diagnosis apply to Texas? Texas with its population of 25 million seems to be doing just fine.

So let's not blame the structure and how it doesn't accommodate the divergence between knowledge and power. Let's put it squarely where it lies: on the policies and competence of those in power.

Scott Sumner writes:

Good post. I agree, and have talked about some of the of the same examples (Denmark, Singapore and Switzerland) in my blog. I need to take a look at your book, it sounds interesting.

I like the way you discuss politics on this blog. Most people on both the left and right get bogged down in the political dispute du jour, and fail to see the bigger picture

David C writes:

Given that there's plenty of other countries to choose from when looking at what works and what doesn't, I fail to see why a lack of options is the problem. Is it that we are too self-interested to look at what other countries are doing, but we are willing to look at what other states are doing? Isn't the burden of proof on Arnold Kling to demonstrate or at least give good evidence that smaller political systems work better than big political systems?

By the way, Steve Y, as a resident of Texas, I can assure you that Texas' state government has a much better system than the national government or California. If we had to deal with California's process, we'd probably be just as screwed up. And Texas isn't perfect.

RubberCity Rabble writes:

In his reasons for devolving gov't functions from national to state/local, Arnold says:

"The second reason is to bring about greater equality in political power. Power at the national level creates extreme inequality between the few who hold office and the rest of us who do not. Basically, we can vote in elections, and that is it. With power more localized, we have a greater chance of holding office or having influence as voters."

I think Arnold omits some players in this picture of political power. Besides those of us with one vote and the recipients of those votes, there are lobbyists, non-registered influence peddlers, "persons" (unions and corporations) who can't vote but certainly have power...

They influence the state/local level now; if less than nationally it's because the stakes are generally smaller. When more power devolves from nat'l to state/local, there's more payoff (perhaps literally!) for local efforts at lobbying/persuading/
cajoling/threatening. Arnold's hope that "we have a greater chance of... having influence as voters" may just as likely be trumped by the influencers redirecting their effort$ to wherever they find the best results.

This is not an argument against devolving the power - just suggesting we not have unrealistic expectations about what it can bring.

Steve Z writes:

Mr. Kling,

I am intrigued by your point about virtual jurisdictions. I have had a similar thought: actualizing the old metaphor about a "social contract." It is presently possible to implement a society in which various categories of law and policy serve merely as default rules, modifiable by contract. For instance, one could be born into a single payer system, but contract out of it upon reaching the age of majority.

Lord writes:

While I would like to see much more in the way of decentralized solutions, we shouldn't neglect the increase in externalities such an approach leads to. If they are more successful only for the reason of dumping their costs on their neighbors, this does not represent actual progress.

Bill N writes:

I challenge the premise. Looking around, I see no shortage of government or governance.

sourcreamus writes:

School districts have most of the attributes you would like governments to have, yet the quality of school governance does not seem to be of much greater quality than most government. I am not an expert on the subject but the most important variable seems to be the quality of the people governed.

Methinks writes:

This still needs Federal action. If one state operates a successful universal health care system.....

If pigs could fly. There is no such thing. Even with all of the restrictions you suggest and with the small size of populations in European countries, universal health care is not successful. Although, I think there's a greater likelihood of success if participation is voluntary.

Regarding Americans becoming ungovernable, I'm reminded of a line from Star Wars. "The more you tighten your grip, the more we will slip through your fingers."

Sanjiv writes:

Excellent post, Arnold. I second Scott Sumner, your way of discussing politics is so refreshing compared to other blogs.

Burk writes:

With all due respect, you are chasing phatasms here.

The key problem is institutional sclerosis. The senate rules, the unrepresentative composition of the senate, the gerrymandered and safe seats (rotten boroughs), the corrupt influence of money and corporations, all add up to gridlock. Gridlock favors incumbent interests, which have incumbent money to spend on corrupting incumbent officials.

Thus we can not address any current problems, let alone future ones.

Robert writes:

Steve Y.: California has a rule that requires a 2/3 majority for tax increases or budget changes, I think. In a sense, they have an even more restrictive version of the filibuster. California vs. Texas appears to be a completely invalid comparison.

If someone could point to a successful, functioning government that required a super-majority to pass laws, it would be a powerful counterexample to the arguments of Ezra Klein, Alexander Hamilton, Pearlstein, etc. Does one exist? This is an honest, open question.

sg writes:

Sourcreamus, school districts are not truly free to self govern. There are too many state and federal mandates that remove any real decision making at the local level.

theBuckWheat writes:

The country was not designed to be "governable" in the sense that the modern socialist State must be. It was designed to be a government of such limited and enumerated powers that the welfare state should be impossible.

We would not have most government employees because most government functions are still not found in these enumerated powers.

We would not have totally unconstitutional extra-governmental corporations such as the Federal Reserve, a corporation that employs 20,000 people and is owned by our financial institutions in direct proportion to their capital.

So, it is a delight to see the wisdom of the original plan yet again validated. It is simply impossible for a central authority to know as much about any national problem as the widely distributed people who deal with it can know. The proper role of government then must only be to set the legal framework in which sound decision-making can occur. This is why liberty is so important to prosperity.

The founding fathers gave us a system designed to maximize liberty, not maximize the size of government. The sooner we recognize this the sooner we can begin to free ourselves from the cancer of socialist central planning. We have allowed this disease to fester too long.

Kirk Parker writes:

"instead, he agrees with Donald Wittman that we have solved the principal-agent problem pretty well. "

Wow, if we're in Nirvana, then why do I feel so bad?

:-)

[Inappropriate vocabulary edited. Kirk, welcome to EconLog. Please keep it polite here. Obscene words typed with asterisks are no less obscene. :-) --Econlib Ed.]

yarrrrr writes:

You should get your book on the kindle...

Vince writes:

I haven't read your chapter on this, but the problem is at-least tangentially related to von Mises economic calculation problem in that both deal with essentially the problem of information aggregation.

So, starting from a naive point-of-view, it's clear from mathematical network modeling that a fully random ER network is inefficient and that a fully centralized network is inefficient. The question is what is the most optimum network design for current communication ability and speed and how does it scale.

There is no question that, at least historically, decentralized networks have offered the most efficient governmental design. Scale-free networks are so prevalent for many of these same reasons. But, the question of the statist you'd need to address is as the communications speed increase, does the optimal network topology converge on the centralized model?

The real-world analogy is Project Cybersyn in Chile during the '70s, which failed. But, iteratively improve it, until a day in the future of full connectedness.

I would believe we can show the distributed model to be optimal overall, although in reality it's likely more complicated. Certain functions will yield efficiencies scaling toward a centralized model, say national defense, while others are are better distributed, like disaster recovery or social issues.

A really slick government would provide rationals for why each slice is better off with what model, but instead we have an Obama plus 59 power-grab.

PS. As an aside, I don't follow your rational of distributed knowledge being a problem. In 1785, perhaps; in 2010... not to the same extent. I found this via Glenn Reynold, who -- along with his army of David's -- I think would disagree.

mulp writes:

"Switzerland, which is about the size of Maryland, has different health care systems in each of its 20-odd cantons, which are about the size of Maryland counties. Surely it must be possible to try different health care approaches in Texas and Massachusetts."

The Senate and House bills are attempting to implement the Swiss style here in the US, so I gather this is a preference for the Senate bill which makes the implementation of insurance exchanges largely State based within Federal guidelines.

The Swiss regulate all insurers at the Federal level.

The Swiss require insurance at the Federal level.

The Swiss subsidize at the Federal level, leaving the structure of delivery and supplement to the Cantons.

Perhaps you might consider comparing the US to the EU, where virtually every member state has compulsory health coverage, but with different structures.

The EU Charter on Fundamental Rights states

"Article 35

Health care

Everyone has the right of access to preventive health care and the right to benefit from medical treatment under the conditions established by national laws and practices. A high level of human health protection shall be ensured in the definition and implementation of all Union policies and activities."

But it seems to me, everywhere you turn, nations are going in the "wrong" direction. Taiwan and Switzerland, in the same year the US refused to face reality on health care decided to implement compulsory health system policies. A year ago, Singapore implemented a means tested single payer sliding scale subsidy, patched on top of an already complex state intervention in pricing, so it is no longer something so "idyllic."

What does it say when the two extremes, the authoritarian states in Asia, and the even harder to govern EU, and Swiss with its plebiscites are all able to agree on the principle of a compulsory health care system?

mark l. writes:

'smart' enough to elect him, too 'dumb' to follow him.

or the conservative slant...

'dumb' enough to elect him. 'smart' enough not to follow him.

787 billion?
he could have cut a check for 2500 to every american, and saved a little.

2 million jobs created?
that's 390k per job.

Patri Friedman writes:

Yet another data point that smart consequentialist libertarians, given enough time, become anarchists. (Even if you're smart enough not to use the a-word. "Virtual government' is much better branding)

I think you're gonna like my book. We cite FP2P a bit. I'll see if I can get some U&U in there too.

cbunix23 writes:

# First I think the problem is overstated. You don't see a ton of
# people moving to MA to get health insurance.

I know someone that moved to MA exactly for that reason. Their son required expensive care they couldn't afford and MA would pick up the tab. This was more than 10 years ago.

Other states are better examples. After Arkansas expanded health care coverage there was a large influx of elderly people who qualified and straining the state budget. The old rule "When you subsidize something you get more of it" applies here too.

OH has a little known program to cover kids with chronic medical issues. The only reason I know about this is when our daughter was diagnosed with arthritis her doctor told the state and the state sent us paperwork we had to return to make sure she would be covered either by insurance or we had sufficient level of income or the state would cover it. We can afford it with our insurance at this time but if I lose my job I'm not going to cry if the state insists on picking up the tab. If we have to move to find a new job that state coverage will factor in my calculation.

Why didn't OH cover the son of the guy I know but they would cover my daughter ? I couldn't say.

Anyway, I think you underestimate the level of motivation of people to move where welfare is better.

I'm all for more federalism, but am not optimistic that we'll move in that direction anymore soon.

Snorri Godhi writes:

A reference to Hayek would fit nicely here. People who argue that checks and balances must be removed to make the state "governable" are behaving exactly like Hayek predicted they would.

Also, Hayek extolled the virtues of small countries, particularly The Netherlands and Switzerland. I don't know if he was the first to say that small (in population) is beautiful, though: can anybody point me to others?

craig writes:

[Comment removed for supplying false email address. Email the webmaster@econlib.org to request restoring this comment. A valid email address is required to post comments on EconLog.--Econlib Ed.]

tysm writes:

Doh!...so you mean the original intent of our Founding Fathers and the birth documents of our Nation...that the Federal Government is limited in scope and power and most power resides with the States and the SOVERIGN PEOPLE is the best way to go....who'd thought!!!!!!

Ric Locke writes:
...if there were scale efficiencies in government services beyond the level of 10 million people, then we would expect governments in small countries to be much, much worse than in the U.S.

And, in fact, if anything we find the reverse. We may not like the way (some) small countries are governed, but they are remarkably persistent. Note that "size" is not necessarily a function of population only -- tyrants and dictators have consistently discovered that an "ungovernable" polity becomes quite controllable if it is poor (i.e., simple) enough. Kim rules North Korea very effectively using techniques that could not be successfully applied to the more vigorous society of the South.

The same principle applies to private business. James J. Ling set off a wave of "conglomeration", which foundered very quickly on the discovery that the assumed economies of scale it was based on did not exist. I would argue that if you examine any example of what looks like tight central control that is successful, you will find a distributed control system underlying it.

Vince is correct in applying network theory to the matter. My limited and sophomoric knowledge of network theory as she are theorized is that most of it assumes instantaneity and faithful transmission. (If not, that pleases me even if it makes me wrong.) If the technology contains significant delays, bandwidth limits, and/or the possibility of garbled transmission -- all prominent features of networks of human beings -- a tightly centralized model falls over quickly, not as a matter of theory but from experiment and experience.

This is a matter I've been struggling with on my blog; of course I don't have the credentials to get much of a hearing. I'd like to ask those of you with a bit of free time to stop by and contribute, starting with my first substantive post.

Regards,
Ric

[Link edited to final destination. Please do not give shortened links or links that merely relay or bounce readers around elsewhere. Please give links to your original material.--Econlib Ed.]

eccdogg writes:

cbunix,

There is no question that SOME people may move for health benefits. The real question is does that create a substantial cost to a state system. What percentage of people with cancer move to the state with the highest benefits? 0.01%,0.1% 10%, 50%, 100%?

My guess is that there are many factors that influence where someone lives and folks would not move in substantial enough numbers to wreck a state health system.

I look at my own situation, I could easily move to my company's Texas office where my taxes would be much lower (I've done the math) but I don't because I like living where I live.

Also my state has very low college tuition and good schools but I don't see a huge number of move ins swamping that system even though in state tuition is 1/10 of out of state so for folks with 3 college age kids the savings could be as much as 100k.

Again, would some people move at the margins base on how generous health benefits are. Yes. The question is how many and is the number great enough to cause a "Race to the Bottom". My guess is no.

But states could still initiate policies to deter this type of behaivior by limiting access for a time period after arrival.

Ric Locke writes:

The "race to the bottom" is self-limiting provided that resources are not treated as infinite.

Egregious example: State A decides to give everybody a new car. They are then swamped with immigrants anxious to get better transportation. State A runs out of money, and not only cannot give out any new cars, its options for providing other services (such as the roads to run the cars on) become severely limited. It therefore becomes a much less desirable place for people to move to, and in fact both old and new residents start moving out, looking for a place with better services.

The latter effect is the primary source of immigrants to the United States.

Apologies for the confusion over the link. I simply went to my WordPress administration pages and chose "get shortlink". There was no intent to confuse or mislead.

Regards,
Ric

[Thanks for your prompt and helpful explanation about the confusing link, Ric! We welcome you to EconLog.--Econlib Ed.]

ThomasL writes:

From Dan Weber: "This still needs Federal action. If one state operates a successful universal health care system, they can get a flood of sick immigrants..."

I don't see any reason that health insurance benefits couldn't vest at a defined rate.

It isn't quite the same scale or idea, but for a real life case, people never flooded into AK to get the oil revenue disbursements. I'm sure that was in no small part because one isn't eligible to receive them until living there for quite some time.

cbunix23 writes:

"My guess is that there are many factors that influence where someone lives and folks would not move in substantial enough numbers to wreck a state health system."

The recent Arkansas example proves you wrong. I'm not making this up, it really happened. Maybe Arkansas had such a generous medical program that it burned out very quickly.

In general state programs aren't quite so generous and people put a high priority on staying near family, or keeping their existing job, etc. so they don't pick up and move unless they have a really good reason.

I've been around long enough to know it's not really about health care, it's about votes. Politicians use this issue just like any other, to line up a voting block that will keep them in power. I'm just cynical that way.

AST writes:

America is not "ungovernable" but it is difficult to govern in the way progressives want because it was designed to thwart such impulses. The states in the beginning were very jealous of their prerogatives and distrustful of a central authority that operated like the British governors and military. Alexander Hamilton was a strong voice for a vigorous central government, but he was engaged in trade in New York and saw the ways that a stronger federal government could enhance trade. However, that is a limited area which was handled by the new Constitution. I don't think he or any of the founders would consider our current laws and regulatory regime "progress."

I'm not a libertarian, but I'm closer to that end than our current situation.

Dave writes:

If different states (or virtual districts) had different health care systems, the best doctors would flock to the ones that encouraged overuse of care without sufficient cost control. So, basically, if one state kept our current system, the best doctors would flock there to earn the highest incomes.

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