Give bigger government a chance

For too long, we've bought the idea that government has failed us.

By Ezra Klein


May 13, 2007

ON APRIL 2, this newspaper reported that the Los Angeles Police Department had asked Philip Morris USA for a $50,000 donation to help fund its investigation into counterfeit cigarettes. That makes a lot of sense: If TV cop shows have commercials, why shouldn't real police work have corporate sponsors too (you know, aside from the obvious reasons of favoritism, bias and perverse incentives)?

For that matter, what's wrong with wealthy families in La Cañada Flintridge, San Marino and other communities holding constant fundraisers to pay for the unfunded needs of their local public schools — drama societies and marching bands and that sort of thing? Or with parents having to go out and purchase body armor on their own so that their sons are protected in Iraq? What's so odd about the crown jewel of the University of California graduate system, Boalt Hall Law School, having to move toward "privatization" so that it can raise more money and better compete with its private counterparts in an era when state funding has dried up?

What's so wrong, in other words, with hollowing out the public sector and replacing it with a pay-as-you-go society? It is the natural endpoint, after all, of the privatization craze, of the gospel of tax cuts and of the smaller-government-is-better-government mentality that has been on the ascendancy in the U.S. for nearly 25 years.

The New York Times recently offered a particularly striking example: Apparently there are about a dozen jails throughout California that offer pay-to-stay "upgrades." Inmates (or "clients," as they're known) who pay an extra $75 to $127 a day get a cell with a regular door, located at some distance from violent offenders, as well as the right, in some cases, to bring in an iPod, a cellphone or a laptop. The rich no longer need patronize the same jails as the rest of us. It makes you wonder whether Paris Hilton's unexpected jail time is a sentence or a scouting mission for new hotel expansion opportunities.

How has this come to pass? As the old adage goes, when the gods want to punish you, they give you what you want. Conservatives talk a lot about government failure, but over the last few years, it's really we who have failed government, depriving it of the revenue, the conscientious management and the attention needed for it to succeed. Undercapitalize a pizza joint and your customers will taste the poor ingredients, become frustrated by the long waits and grow repulsed by the grimy environs. Staff it with your unmotivated drinking buddies and the service will falter, as will the quality of the product. It's no way to run a pizza place, and it's certainly no way to run a government.

But that's exactly what we've done. With Proposition 13 and the famous California tax revolt, and with presidents whose entire domestic programs amounted to mindless tax-cutting, and with Congresses that have been happy to pass cuts and stack deficits, we have systematically deprived the government of the revenues it needs to provide basic services, even as we've come to need it to do so much more.

The Bush administration has only added to the problem. The president once said: "I was campaigning in Chicago, and somebody asked me, 'Is there ever any time where the budget might have to go into deficit?' I said only if we were at war or had a national emergency or were in recession. Little did I realize we'd get the trifecta." He's right. Not only have we spent more than $500 billion in Iraq and Afghanistan and untold more on homeland security measures, but we've created, in Medicare Part D, the most expensive new entitlement since President Johnson signed the Great Society into existence. We've also increased education spending through the No Child Left Behind Act.

And during all this, tax cuts have robbed the Treasury of $200 billion in revenue; the need for a two-thirds majority in the Legislature impeded the flexibility of California to raise state taxes to compensate, while Proposition 13 continued to handicap our municipalities. All that money has to come from somewhere. And the "where" isn't the high-profile initiatives that the media is watching — the Medicares and Social Securities (although they may suffer too) — but from the smaller, less-noticed, but critically important programs and departments that millions rely on.

If Congress must constantly approve high-profile emergency expenditures that funnel hundreds of billions of dollars toward Iraq, and states cannot pick up the slack, there will have to be cuts in funding for police and schools and jails and Pell Grants and the Food and Drug Administration and the National Institutes of Health and the Department of Veterans Affairs and the nation's infrastructure and all the rest. So is it any surprise that law enforcement is extending a beggar's cup to Philip Morris, public colleges are becoming less affordable and UC law schools are shilling for corporate dollars? And that it's all happening even as the globalizing economy demands ever higher skills, as ill and traumatized Iraq war veterans are going without care, as roads and schools are crumbling and myriad other minor catastrophes are underway beneath the notice of the national media but well within the range where they harm ordinary Americans.

Such unhappy outcomes are not merely morally unsettling, they're often economically inefficient. Government spending can be more than necessary, it can be desirable. It can step in, for instance, when the market fails to deliver public goods that society desires but private entities haven't figured out how to fund. (It's useful having a national military, right?) And it can use its regulatory power to ensure that competition works to increase well-being rather than to simply amp up industry profits.

UC Berkeley economist Brad DeLong once wrote that "sometimes government failures are greater than the market failures for which they purport to compensate. Sometimes they are not." The trick is knowing which is which. But if, like the Bush administration, you are blithely unconcerned with running an efficient, effective government, funding its necessary elements, presenting honest choices to the American people between tax cuts and social investment and staffing the whole enterprise with skilled professionals, you never need make those judgments as you have neither the resources nor the personnel to effectively deploy the central organizing structure of modern societies. And that's a shame.

Libertarian humorist P.J. O'Rourke likes to say that "Republicans are the party that says government doesn't work, and then they get elected and prove it." Over the last few years, that's been true. But government can work, and increasingly, Americans appear to be anticipating its return. A new Pew Research Center poll finds that public support for a societal safety net and for government protections is at its highest levels in more than a decade — which suggests that Americans don't think bake sales are the way to fund their schools or that Philip Morris is really who they want subsidizing law enforcement. And in recent elections, the once popular "Taxpayer's Bill of Rights" amendments that seemed so unstoppable a decade ago are being rejected and, in Colorado, repealed, as voters finally tire of paying the costs in broken infrastructure and insufficient public services.

When asked what type of political system Americans would have, Ben Franklin famously responded, "A republic, if you can keep it." Well, he also bequeathed us a government, if we can run it. And somehow, I don't think the Philip Morris police department is quite what he had in mind.


EZRA KLEIN is a staff writer at the American Prospect. His blog is at www.EzraKlein.com.