The Cost of Doing Something

Declaiming the price of "inaction" is a perennial argument for big government and bad law

Matt Welch | July 1, 2009

On the eve of what would be a 219-212 House of Representatives vote in favor of the American Clean Energy and Security Act, the New York Times editorial board argued that whatever the bill's eventual price tag, it sure beat "the costs of doing nothing." Warned the Gray Lady: "By any measure—drought, famine, coastal devastation—the costs of inaction, of clinging to a broken energy policy, will dwarf the costs of acting now."

If that argument sounds familiar, it is. Times columnist Paul Krugman, while declaring those 212 nay votes guilty of "treason against the planet," posited that "we're facing a clear and present danger to our way of life, perhaps even to civilization itself." Therefore, "How can anyone justify failing to act?"

The same logic, minus some of the apocalyptic language, is being used this summer to push through President Barack Obama's other massively expensive overhaul to the way America does business: health care reform. "I can assure you," the president said recently in Green Bay, Wisconsin, "the cost of doing nothing is going to be a lot higher in the years to come. Our deficits will be higher. Our premiums will keep going up. Our wages will be lower. Our jobs will be fewer. Our businesses will suffer." Echoed Health and Human Services Secretary Kathleen Sebelius a week later: "The cost of doing nothing will render us a second rate nation on into the future." Rep. George Miller (D-Calif.), in subsequent House hearings, went still further: "There is not one child, not one worker, not one employer, nor one taxpayer who can further bear the cost of doing nothing."

Hyperbole aside, the urge to have the government do something in the face of a perceived crisis is arguably the most powerful and effective legislative engine known to man. If the crisis is acute enough, backers of state intervention will even admit that content matters less than the mere existence of action itself. During the height of last fall's financial panic, for example, New York Mayor and financial journalism titan Michael Bloomberg said on NBC's "Meet the Press" that "Nobody knows exactly what they should do, but anything is better than nothing." As the House of Representatives was passing the stimulus package this February, Rep. David Obey (D-Wisc.), chairman of the House Appropriations Committee, thundered that "the cost of doing nothing would be catastrophic." Auto bailout? "The cost of doing nothing is cataclysmic," warned Sen. Bob Casey (D-Penn.) last December.

In weighing the pros and cons of a given bill, one way to assess the "do something" argument is to apply analytical rigor where legislators and their enablers insert dystopian adjectives. For instance, instead of taking international trade economist Paul Krugman's word that global warming poses a "clear and present danger" to "civilization itself," you could grapple with the legislative analysis by Reason Science Correspondent (and controversial global warming believer) Ronald Bailey, who has followed the science and policy of this stuff for two decades.

Another way is to look back in history, and see how previous laws passed using this justification have stood the test of time. Here is a highly partial list of four questionable bills rammed through Congress using classic do-something logic. One could easily assemble a much longer tally of perceived crises that weren't actual emergenices, and/or instances when doing something turned out to be worse than doing nothing at all.

Law: Authorization for Use of Military Force Against Iraq Resolution of 2002
Existential Threat: President George W. Bush: "[T]he Iraqi regime is a threat of unique urgency....[I]t has developed weapons of mass death; it has used them against innocent men, women and children. We know the designs of the Iraqi regime. In defiance of pledges to the U.N., it has stockpiled biological and chemical weapons. It is rebuilding the facilities used to make those weapons....Saddam must disarm, period. If, however, he chooses to do otherwise, if he persists in his defiance, the use of force may become unavoidable." House Speaker Dennis Hastert: "I think the bottom line for all of us here is, we've been through this process, we've been through September 11th. We visited Ground Zero. We've been at the Pentagon the day after. And we don't want that type of tragedy to happen in this country again. And we will do everything in our power to prevent it from happening again."
Promise: "[A]s we saw in the fall of the Taliban, men and women celebrate freedom's arrival....We'll work with other nations to help the Iraqi people form a just government and a unified country. And should force be required, the United States will help rebuild a liberated Iraq."
Results: Saddam was indeed disarmed and dethroned, though he didn't have the weapons he was supposed to disarm. Neither freedom nor unity nor a "just government" arrived quite as advertised, and the rebuilding process continues.
Cost of Doing Something: An estimated 4,322 U.S. military killed and 68,920 wounded; 1,360 U.S. contractors killed, 318 non-U.S. coalition forces killed. An estimated 100,000 or so Iraqis killed, though those numbers are hard to measure and disputed. An estimated 2.8 million Iraqis displaced from their homes. Plus more than $1 trillion spent, and the U.S. military stretched.

Law: The Sarbanes-Oxley Act of 2002.
Existential Threat: Allegedly plummeting investor confidence in the wake of recent corporate scandals at Enron, Adelphia, WorldCom, and elsewhere.
Promise: President Bush: "No more easy money for corporate criminals, just hard time....The era of low standards and false profits is over."
Results: Um.
Cost of Doing Something: Created make-work for auditors. Compliance costs affected small actors disproportionately. Companies stopped going public.

Law: The Bipartisan Campaign Finance Reform Act of 2002.
Existential Threat: John McCain: "Our political system is confronting today a very serious challenge, as dangerous in its way as war and depression have been in the past. America will need your best efforts to defeat it. The threat that concerns me is the pervasive public cynicism that is debilitating our democracy....When the people come to believe that government is so dysfunctional or corrupt that it no longer serves these ends, basic civil consensus will deteriorate to the point that our culture might fragment beyond recognition....We desperately need to reform a campaign system that lures good people into bad practices; a system that values money far above ideas and integrity; a system that is a stain upon every public official's honor."
Promise: To "break the iron triangle of big money, lobbyists and legislation and take the government out of the hands of the special interests."
Results: Er, not so much.
Cost of Doing Something: Among many other restrictions on political speech, the law put the federal government in the role of censoring political advertisements by organizations unaffiliated with any political party or candidate. Compliance costs affected small actors disproportionately.

Law: The Anti-Terrorism and Effective Death Penalty Act of 1996
Existential Threat: Terrorism by foreigners (such as the 1993 bombing of the World Trade Center) and terrorism by domestics (such as Timothy McVeigh in 1995).
Promise: "[T]o stop terrorists before they strike, and to bring them to justice if they do....[T]o deport terrorists from American soil without being compelled by the terrorists to divulge classified information, and to bar terrorists from entering the United States in the first place."
Results: Terrorists, including foreigners, continued to murder on American soil.
Cost of Doing Something: Introduced the foul modern concept of secret courts that use secret evidence, removed the appeal process for when legal non-citizens tangle with power-crazed border guards, limited appeals for death row inmates.

There are times when doing something with the federal government is the perfectly appropriate or reasonable response to a given challenge. Such is the fodder of constructive public policy discussion. But when a politician or pundit uses scare language about the perils of inaction, that is often an attempt to shut discussion down, and force through something today that many of us will be sorry about for years to come.

Matt Welch is editor in chief of Reason.

Comments

Peter|7.1.09 @ 5:39PM|#

But what would you have us do? Obviously we can't do nothing about this...we have to DO SOMETHING!

Douglas Gray|7.1.09 @ 5:43PM|#

An act of Congress to prevent "drought, famine and costal devastation?"

It's more of a psychological dependency for those in Congress; passing these Bills makes them feel needed.

|7.1.09 @ 6:19PM|#

I think that when urged, prodded, cajoled, and ultimately threatened to produce more, contribute more, work harder, sacrifice more, i'll just . . . . do nothing.

We pretend to work, and they pretend to pay us.

Mike|7.1.09 @ 6:33PM|#

This is one of libertarianisms greatest PR problems. Whenever someone says, "Look at this problem, what are we going to do about it?", the best answer we can give is, "Any attempt by the state to solve the problem will create a worse one in its place."

The answer when I'm feeling snarky is "What do you mean 'we'? What are YOU going to do about it?"

Geddy|7.1.09 @ 7:03PM|#

If you choose not to do anything, you still have done something.

JB|7.1.09 @ 7:30PM|#

Anytime a politician claims that 'something must be done' I suggest they start by fisting themselves.

|7.1.09 @ 8:00PM|#

Geddy-

"If you choose not to do anything, you still have done something."

You can choose from Obama's fears and smugness that will kill our nation/I will choose a path that's clear, I will choose emigration.

|7.1.09 @ 8:35PM|#

I wonder if Congress might try to hold back the tide as well. I really think its just a matter of the ultra-dependent boomer mentality that if you pass a law everything will change and that they can just make someone else do the work or make the sacrifices. Throw that in with having to justify their jobs every 2-4-6 years and you've got what we have now

Mike M.|7.1.09 @ 8:45PM|#

Full-time legislatures are an even greater threat to the liberty of the people than a standing army.

Rich|7.1.09 @ 9:58PM|#

> ... one way to assess the "do something" argument is to apply analytical rigor where legislators and their enablers insert dystopian adjectives.

I have never completely understood how congresscreatures are allowed (by their enabling constituency) to come up with "something to do" based on so little analysis. If engineers designed and built a bridge by just "doing something" there would be hell to pay, but I guess the economy etc. seem sufficiently unreal that mere adjectives suffice.

|7.2.09 @ 1:47AM|#

too bad legislators are not held to the "primum non nocere" precept of first having to ascertain that an action does not cause harm.

jacob|7.2.09 @ 8:29AM|#

Excellent article, Mr. Welsh. Might you add that Hans Blix TOLD US Saddam wasn't armed with the arms our gov't said he was?

Matrix|7.2.09 @ 9:12AM|#

I work for the government, and I see wasted energy all the time. A classroom full of 300 watt bulbs that are replaced frequently. It's still not even that well lit, but I'm sure bulbs with lower watts could do just as good of a job. Governments are the biggest polluters and waste the most electricity. Why not fine or ban the government?

engineer|7.2.09 @ 10:30AM|#

"too bad legislators are not held to the "primum non nocere" precept of first having to ascertain that an action does not cause harm."

But what would they do? 95% of all legislation harms somebody, and politics is about distributing the harm in the manner that will buy the lawmaker the most votes. My ideal society would limit its laws to the fifth, seventh, and eighth commandments (from the Douay-Rheims translation,not the King James Bible), with maybe a paragraph of clarification for each one.

|7.2.09 @ 12:44PM|#

see http://www.napoleonguide.com/leaders_kutusov.htm

Old, horny, and fond of doing nothing. I constantly tell people in the office that this is the best policy, but they foolishly charge forward.

|7.2.09 @ 12:49PM|#

Not to mention that if one read all the fluffery before bills are past, we should be at about the 38th coming, we should all live forever, and I should be getting me my 47th virgin.

|7.2.09 @ 5:56PM|#

Interesting how the author picked both conservative and liberal historical examples of "do-somethingism" legislation. He reminds us that threats to liberty, and to government's very credibility, come from both left and right. He could have added the creation of the Department of Homeland Security, a Hydra which will be with us for many a long and expensive year.

I work in government and I can attest to the potency of the stampede mentality. Heaven help the poor civil servant who raises even the most mealy-mouthed concerns about a course of action which has been decided upon by elected officials. The truth is that most of the congressmen who voted for the climate change boondoggle (and who will soon vote for ill-considered health care "reform") know very well that they are dubious propositions. But they also know it will be years before anyone can prove them so. By that time they themselves will be comfortably promoted or retired. If the latter, they may well reflect upon their follies with a candor and intelligence which consistently eluded them in their role as "deciders".

|7.2.09 @ 8:51PM|#

If government really wants to do something it could start out by fixing Medicare and Medicaid and enrolling all those who are eligible in the existing programs such as SCHIP.
The low administrative cost of Medicare is not a positive it is a negative. More needs to be spent on controlling expenditures through preclearance of surgeries, etc. That will stop the unnecessary surgeries that just line providers pockets. Then government can bid out certain things such as providing renal care and diabetic supplies where it is currently over paying (if they aren't over paying how can all these companies do so much advertising?)
And enroll all those eligible will get about one third of the uninsured covered.
Finally, the federal government could charter national health insurers and relieve them of all the onerous state mandates. Then people could buy policies with the coverage they want rather than being forced to buy Cadillac coverage by a political lobbying effort that lines the pockets of providers.
These few steps would dramatically lower health care costs!

|7.2.09 @ 11:20PM|#

When people make the argument that the costs of not doing something are too great to ignore, I ask them what exactly are the costs, over what timeframe, what is their confidence level, and how did they calculate those costs, timeframes and confidence levels. Making the argument that the costs are ultimately infinite at some undetermined point in the future and not being able to define an intermediate progression is intellectually lazy and these people should be ignored. People need to do the hard work to back up their arguments.

matthew|7.3.09 @ 11:33AM|#

Just so I'm clear on this..

Is the argument of this article that the merit legislation to control climate change should be based on the validity of other legislation in perceived times of crisis?

|7.3.09 @ 9:19PM|#

How zen of you!

|7.5.09 @ 8:37PM|#

Good and Bad Credit

Mises Daily by Frank Shostak | Posted on 10/16/2008 12:00:00 AM

Why then are authorities resisting market forces and allowing the crunch to persist?

Because if interest rates were allowed to be higher, many bubble activities would become unprofitable, and would cease.

Most of those in a position to influence policy are of the view that this would lead to a serious economic slump and therefore should not be allowed. Supporting bubble activities with easy money further impoverishes wealth generators and delays the prospects of a meaningful economic recovery. The pumping by the Fed will distort the interest-rate structure further and worsen the credit crunch.

The best policy is for the Fed to do nothing as soon as possible. By doing nothing, the Fed will enable wealth generators to accumulate real savings. The policy of doing nothing will force various activities that add too little or nothing to the pool of real savings to disappear. This will make make the generation of wealth much more rewarding.

complete article on link at Ludwig Von Mises Institute.

It is no different with cap and tax
http://mises.org/story/3151