Free Minds & Free Markets

Eternal Life

Why government programs won't die.

Consider two risible objects, Woody Allen and the National Sheep Industry Improvement Center. One is risible because it is mortal. "It's not that I'm afraid to die," Allen once said, "it's just that I don't want to be there when it happens." The other is risible because it is immortal. It is living proof that, four years after Bill Clinton came to office promising a new day and two years after Newt Gingrich did the same thing, Washington is still in deep trouble.

Back in 1954, when wool was a vital strategic commodity (for military uniforms), the government set up a subsidy for wool producers. Then Dacron happened, and by 1960 synthetics had knocked wool from the Pentagon's must-have list. Nonetheless, three decades later the subsidy for wool and mohair (the fleece of Angora goats--don't ask) was still amiably handing out $100 million or more each year to ranchers, 1 percent of whom got almost half the payments. Finally, in 1993, a Democratic Congress, embarrassed by what The New York Times mocked as the "mohair toilet seat," killed the thing. The wool program died that year alongside the equally bizarre honey subsidy, the Advanced Solid Rocket Motor program, and the Superconducting Super Collider. Requiescat.

Well, it looked dead. But killing a program is not the same as killing a lobby. After a decent interval and a switch on Capitol Hill from old-style Democrats to newfangled Republicans, the wool people stuck their head up again, and last April their persistence paid off. Thanks to Sen. Larry Craig--a Republican from Idaho and supposedly a conservative--Newt Gingrich's Congress tossed the wool lobby a new National Sheep Industry Improvement Center, empowered with up to $50 million in federal funds to "enhance production and marketing of sheep or goat products in the United States."

Has nothing changed in Washington, then? On the contrary, practically everything has changed--politically. Congress went from Democratic to Republican, from Hillaryism in 1994 to Gingrichism in 1995. The presidency passed from Bill Clinton I, tribune of Renaissance Weekend activism, to Bill Clinton II, soldier of the center and prime snatcher of Republican real estate. The public gave Clinton a mandate against Bushian do-nothingism, then gave Gingrich a mandate against Clintonian activism, and now seems about to give somebody--Clinton II or Bob Dole, it scarcely matters which--a mandate against Gingrichite activism.

Through it all, the public is as disenchanted as ever with its government. Now, though, it is equally disenchanted with government's would-be reformers, the Gingrichites. So now everybody has a problem. Conservatives and libertarians find that the ramshackle, rolling accumulation of stuff known as the federal government pauses for a moment when faced with an outbreak of anti-government zeal--and then brushes it aside. Liberals and other friends of government find that Washington is still too bogged down in its own past to do anything well.

And government-friendly reformers--people like me, who think government should do less to do it better--have a problem, maybe the biggest problem. I think government needs a thorough housecleaning, not so much to make it smaller (it will never be very small) as to make it more focused and flexible. It needs to stop trying to do everything for everybody at once. A housecleaning, ultimately, would probably please the public. But, presented with such a reform in a political context, the public resolutely blocks it.

So do the people want reform, or don't they? The answer is: yes. The lesson of the Year of Newt is, I think, fairly depressing, and not just for Gingrich's sympathizers. Between comprehensive disaffection with government and comprehensive reform of government lies a vast chasm, and no bridge. The public despises government and it desires reform, at least in principle. Yet there appears, at least at present, to be no path from here to there.

"Nonsense," say grumbling populists, "the problem is that Washington isn't listening to The American People. It's too busy with its partisan bickering to get anything done. It's out of touch and gridlocked--that's the problem."

Actually, that's not the problem. Neither out-of-touchness nor gridlock is anything like the real problem. To think of Washington's mess in those terms, as most of the public does, is to rush straight off in the wrong direction.

American politics has never been more responsive, indeed more capricious, than it is now. Washington has never been more eager to react to every passing electoral mood. Angry this week about immigrants? Wages? Gas prices? Beef prices? A bomb? A recidivist child molester? You can be sure a bill will be on the floor of Congress tomorrow, if not sooner. Those who say Washington doesn't listen have always been wrong, but right now they are spectacularly wrong. American politics in 1996 is hyper-responsive.

The trouble is that American government is inert. Indeed, the more responsive politics becomes, the more inert government grows. The more frantically the one reacts, the less effectively the other adapts. And this counterpoint is no coincidence. Each begets the other.

In a book published in April 1994, I nicknamed this paradoxical syndrome "demosclerosis" and tried to use theory rather than anecdote to explain government's gradual collapse into manic maladaptation. The problem, I argued, is in society, not just in Washington. As the economist Mancur Olson has shown, society inherently generates goody-hunting, demand-making interest groups (lobbies, basically) much faster than it gets rid of them. The lobbies stream to Washington seeking to win and then defend some subsidy, regulation, or tax break. The more eagerly government scrambles to keep everybody happy, the less able it is to pluck these barnacles from its sides. So it succumbs to a kind of living rot.

Whatever else it may be, demosclerosis is not "gridlock." If people really just wanted Washington to "get more done," they should be much happier with government in the 1990s than in the 1950s, since by all relevant measures (spending, new laws, new regulations, workdays) government does far more now than it did then. In fact, however, the reverse is true. Polls show that, over the past 40 years, the level of dissatisfaction with government and the annual page count of new laws have moved in an almost exactly inverse relation to one another. The more government "gets done," the less people like it.

Washington's problem is not that it goes the wrong speed, but that its wheels are out of alignment. To "get things done" is difficult, which is as it should be. The trouble is that to get things undone is an order of magnitude harder. And that, over time, is a crippling infirmity.

Human cells kill themselves so that the body as a whole can live. But old programs virtually never die. Built into both the system and society is a structural imbalance akin to the Olsonian accumulation of interest groups: Each government program and subsidy is begotten by, or begets, an interest group that cares much more about keeping it than anyone else cares about killing it. As a result, to a first approximation the American government is still doing more or less everything it ever did for anyone--all the way back to maritime subsidies from 1789.

The Pentagon, which has its own $6 billion cargo fleet, now says maritime subsidies are unnecessary. But those subsidies have doled out $10 billion since 1936. No wonder maritime shippers and (especially) unions have given $17 million in political donations over the past decade alone. And no wonder, too, that the subsidies never die. Republicans and Democrats may come and go, but the basic imbalance remains: Programs appear much more readily than they disappear. Everything is quasi-permanent.

For conservatives, the problematic result is that government accretes functions, usurping them from actors better able to perform them. But my goal in Demosclerosis was to show that government-friendly liberals should be just as concerned. Government can no more thrive while continuing to do everything it has ever done than General Motors could thrive while producing every car it has ever made (and heaven knows, GM tried). Today's dysfunctional welfare system was designed for widows in the 1930s and has not been fundamentally overhauled since then. Agriculture subsidies were meant to be Depression-relief measures. Stuck with all of its first tries virtually forever, government loses the ability to end unsuccessful programs and try new ones. It fails to adapt and, as maladaptive things do, becomes too clumsy and incoherent to solve real-world problems.

The prescription, I argued, was twofold. First, focus market pressure on entrenched lobbies by exposing them to economic competition, especially through trade and deregulation. Much of this is happening now, thanks to new technology and permeable borders. Second, clean out government's attic by throwing out lots of programs, not only to free up captured resources but also to defund the lobbies that capture them.

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