America: Your Arteries Are Hardening

At least ossification isn’t the end of the world. If you’re suffering a case of ossification, you’re at least moving at a rapid enough pace to avoid fossilization. However, even if you’re escaping terminal mineral seepage that can turn your bones to stones, ossification is still a serious problem. Reaction time is glacial. Adaption is stunted and malformed. You are the living definition of the slow animal at the back of the herd that is little better than wolf-bait.

America suffers from systemic ossification. Its ability to learn from its experiences is broken. Potential reactions and adaptations are muted, mis-aimed, and skim the surface of deeper pathologies. Symptoms receive morphine for the pain instead of the sharp medicine that would cure the patient. Ideas and actions follow well worn ruts. Using grandfather’s wooden club to beat on your obnoxious neighbor is preferred to building your own club from space age materials.

Why does a formerly healthy system break down and why does it resist all attempts to heal it, especially the most sweeping endeavors?

There are many explanations. In 1992, Jonathan Rauch summarized a few of the more popular ones in his essay Demosclerosis, later expanded into a book that I first read in the early nineties (there’s an updated version I haven’t read) that covers:

Liberals blame conservatives. “Government has stopped addressing accumulated public problems,” wrote the liberal journalist Robert Kuttner in The New Republic [not so] recently: “a deliberate strategy of laissez-faire Republicans, who don’t believe in government.”
 
Conservatives blame liberals, alleging that left-wing ideology drives liberals to cling brainlessly to every program ever adopted. “Reactionary liberalism,” the conservatives call it.
 
Populists and business-bashers, such as the liberal journalist William Greider, blame moneyed elites and corporate lobbying. Political analysts blame the current state [as of 1992] of the political system: divided control of the government, the early-1970s reforms that dispersed power in Congress, the breakdown of strong political parties, the rise of a professional political class and so forth.
 
The public blames, above all, “leadership,” of the lack of it. A strong leader (runs the theory), uncorrupted by politics as usual, could shake the barnacles from the system. Thus the wave of support for Ross Perot.

Rauch suggested there were deeper forces at work:

In 1982, a University of Maryland economist published a scholarly book called The Rise and Decline of Nations. Mancur Olson set out to explain, or partially explain, why societies tend to ossify and stagnate as they age…
 
In every society, Olson said, there are two ways for people to improve their lot and grow rich. One is to produce more; the other is to capture more of what others produce. Doing the latter is possible, but requires political pull or marketplace power; attaining either of those requires that people band together to form either interest groups or cartels.
 
Interest groups can make their members better off by seeking subsidies, tax breaks, monopolies, favorable regulations and so on. Postal workers seek a monopoly on first-class mail; dairy farmers seek production controls to jack up prices; and so on. Private cartels can make their members better off by raising prices and barring newcomers from the market. Olson called such beggar-thy-neighbor groups “distributional coalitions.”
 
So far, so obvious. Then Olson went on to the less obvious. Despite what you might think, to organize an interest group or cartel is difficult. The organizer will bear most of the start-up costs, and yet can expect only a fraction of the benefits, which must be shared among the members. Members, in turn, will be reluctant to join until they see that the group is successful. Even then, they may stay out and let others do the work.
 
As a result, Olson wrote, “organization for collective action takes a good deal of time to emerge.” Trade unions did not appear, for instance, until almost a century after the Industrial Revolution. Farmers’ groups didn’t appear in America until after World War I. Social security dates back to 1935, but the AARP didn’t appear until 1958.
 
Once groups organize, however, they almost never disappear. Instead, Olson wrote, “they usually survive until there is a social upheaval or other form of violence or instability.” Furthermore, over time the interest groups professionalize. This makes them still less likely to go away: Amateur activists can always drop the cause and go home, but for professionals, the cause pays the mortgage.
 
The result, Olson concluded, is this rule: “Stable societies with unchanged boundaries tend to accumulate more collusions and organizations for collective action over time.”…
 
Cartels have not proved to be the problem that Americans once expected, thanks mainly to foreign completion. If cartels organize the domestic market, as some say the Big Three automakers did informally through the 1970s, fat profits lure in imports to bust the trust.
 
But political pressure groups have the added power of the law, and are not so easily undermined. These groups’ effects are of two kinds, economic and governmental.
 
Economically speaking, entrenched interest groups slow the adoption of new technology and ideas by clinging to the status quo. They distort the economy, and so reduce its efficiency, by locking out competition and locking in subsidies. As they grow, they suck more of society’s top talent into the redistribution industry. All in all, the economic costs can be very large.
 
The other kind of effect is on government. The accretion of interest groups, and the rise of bickering over scarce resources, Olson feared, can “make societies ungovernable.”
 
Now the theory’s darker implications come into view. “The logic of the argument implies that countries that have had democratic freedom of organization without upheaval or invasion the longest will suffer the most from growth-repressing organizations and combinations,” Olson wrote. If he is right, then the piling up of entrenched interest groups, each clinging to some favorable deal or subsidy, is an inevitable process as democracies age.
 
However, occasionally some cataclysmic event — war, perhaps, or revolution — may sweep away an existing government and, with it, the countless cozy arrangements that are protected by interest groups.
 
If his theory is right, Olson concludes, “it follows that countries whose distributional coalitions have been emasculated or abolished by totalitarian government or foreign occupation should grow relatively quickly after a free and stable legal order is established.”
 
Look at Japan and [the former] West Germany, where authoritarian regimes and then foreign occupations swept away entrenched interest groups and anticompetitive deals. “Economic miracles” followed in both countries as resources were freed from groups that had captured and monopolized them. (Catch-up growth, Olson says, can explain only a part of Japan’s and Germany’s success.) By contrast, “Great Britain, the major nation with the longest immunity from dictatorship, invasion and revolution, has had in this century a lower rate of growth than other large, developed democracies.”
 
Even in the United States, Olson said, the pattern applies. Statistical tests comparing the 50 states showed that “the longer a state has been settled and the longer the time it has had to accumulate special-interest groups, the slower its rate of growth.”
 
His hypothesis suggested a social cycle:
 
A country emerges from a period of political repression or upheaval into a period of stability and freedom. If other conditions are favorable, rapid growth ensues. (South Korea and Taiwan, both emerging from dictatorship and both showing rapid growth, would be in this stage today [in 1992]; China might be next [not yet].) Gradually, interest groups organize and secure anticompetitive deals. These deals accumulate, each being jealously defended. Over time, growth slows and paralysis sets in.

Rauch takes Olson’s insights from economics to politics and returns us to our original question:

Why has government become so ossified and immobile?
 
In large, complex systems, the key to successful adaptation is the method of trial and error. In the large, complex system of biological evolution, species undergo mutations, the vast majority of which fail. A few, however, succeed brilliantly, and those proliferate by out-competing the others. That is how life adapts to changing environments.
 
Similarly with a capitalist economy: The key to its adaptability is that it makes many mistakes but corrects them quickly. Entrepreneurs open businesses; many fail, but every so often someone hits on a brilliant innovation. The more-successful strategies will proliferate by out-competing the others. Capitalism adapts through trial and error.
 
Similarly with science: It tries out countless hypotheses every day and abandons most of them. The knowledge base adapts through trial and error.
 
Government is another big, complex social system. The way for governments to learn what works in a changing world is to try various approaches and quickly abandon or adjust the failures: trial and error. However, something has gone badly wrong.
 
For fiscal 1993 alone, the [George H. W.] Bush Administration proposed ending 246 federal programs and 4,192 federal projects. How many of those will die? Approximately none. The Reagan Administration made a fetish of trying to eliminate federal programs. Despite President Reagan’s high popularity and his effective control of Congress in 1981-82, during his eight years in office a grand total of two major programs — general revenue sharing and urban development action grants — actually got killed.
 
One reason is that people disagree about which programs failed, and even about what “failing” means. Another reason is that as soon as a program is set up, the people who depend on it — both the direct beneficiaries and the program’s employees and administrators — organize to defend it ferociously. These groups are, of course, none other than Olson’s “distributional coalitions” — what others have for years described as part of an “iron triangle.” They have money, votes and passion. They can be defied, but only at serious political risk…
 
Not only are policies hard to kill, they are also hard to change. Every wrinkle in the law produces a winner who will resist reform….And so programs are impossible to kill and very difficult to correct. The implications of this are profound.Imagine an economy in which every important business enterprise is kept alive by an interest group with political clout. Over time, the world would change, but the businesses wouldn’t. Obsolescent companies would gobble up resources, crowding out new companies. The economy would cease to adapt.
 
That is what happened to the Soviet economy. Which imploded.
 
In principle, the U.S. government’s situation is like the Soviet economy’s. In both, the method of trial and error has collapsed.
 
In Washington, every program is quasi-permanent, every mistake is written into a law that some vested interest will defend furiously. The result is that as the old clutter accumulates, government cannot adapt.
 
First, old programs and policies cannot be gotten rid of, and yet continue to suck up money and energy. And so there is little money or energy for new programs and policies. The old crowds out the new.
 
Second, and at least as important: When every program is permanent, the price of failure becomes extravagant. The key to experimenting successfully is knowing that you can correct your mistakes and try again. But what if you are stuck with your mistakes forever, or at least for decades? Then experimentation becomes extremely risky…Yesterday’s innovations became today’s prisons…
 
Countless policies are on the books not because they make sense in 1992, but merely because they cannot be gotten rid of. They are dinosaurs that will not die. In a Darwinian sense, the universe of federal policies is ceasing to evolve.