Thursday, July 29, 2010

Fixing America's Biggest Problem: No One Trusts Government

This post is inspired by some thoughts I had linked to a DiA post on the possibility of regulating carbon emissions. That specific issue area was adequately covered there so I'm not going to get into it. I'm also not going to pretend this is fully well thought out. It's basis is that I feel Americans have become extremely sceptical of government, part of this is cultural and unchanging but I think part of it is also that the modern problems we need government to deal with are very poorly addressed by the policy options most Americans favor, which as their favored options fail to deliver results only makes them more sceptical of government and less likely to support an innovative policy approach. Given how long Congress has been focused on trying to nickel and dime problems to death by throwing whatever it can get through at them it's no surprise American's have become so sceptical. Every time a new, inefficient bill is passed their scepticism is confirmed and it makes it harder to do it right next time.

This willingness to compromise on method ends up leading to a negative feedback loop, the problem doesn't get solved and the government's ability to pass innovative legislation that would solve it degrades with each new bill as people become more sceptical of government's effectiveness. People demand a problem be solved, they veto the most efficient method of solving it, a new less effective method is passed, this method doesn't fix the original problem and creates additional costs, people are angry that the problem wasn't solved the first time and demand another fix to both the original problem and the side effects, the original best method is now even less likely to pass both because of path dependency and because people are more angry and distrustful of government the first time around because of its failure so another inferior method gets passed, the same sequence repeats ad infinitum.

So what does this mean for future legislation? The problem right now is that the government isn't very well liked and not trusted at all. People won't accept legislation that makes hard choices right now because there's no trust that making these choices will produce results. To break the negative feedback loop we're in government needs to start focusing less on trying to fix big problems, which it lacks the credibility to do, and focus on restoring its credibility. This means passing up on opportunities to fix situations in small ways through passing legislation that addresses problems through less than optimal mechanisms.

To rebuild its reputation government needs to try to focus on smaller problems where it can get effective legislation through, especially problems where mechanisms Americans are sceptical of, such as cap and trade or Pigovian taxes, work well. Ideally, once these policies start working those proposing new legislation can point to these successes as examples and argue for them on a wider scale.

Right now though, we're stuck in a place where innovation is next to impossible because voters are opposed to any experimentation and none of the problems we're facing can be fixed by old methods. Trying to do the best with what we've got will ultimately make it even harder to do anything in the future because negative stereotypes will be reinforced. We need to reassess our goals so that success in the legislature is not seen in the simple sense of getting bills passed but on passing bills that will show that government can be effective, even if only on a small scale.

As a brief side note, if some remarkable policy opportunity comes up that would do something Americans really want, the government should embrace this, even if it is a big, innovative project like what I'm saying should be avoided. I just think the likelihood of an important, easy fix that will also be popular coming up is very small.

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