Can America govern itself? The question matters a great deal for anyone doing business for two rather obvious reasons: one, a country that does not have a functioning system of governance cannot have a thriving economy; two, America is the world’s biggest economy.
Most people tend to think about dysfunctional U.S. politics in terms of Democrats and Republicans not being able to get anything done in Congress. As I wrote a couple of weeks ago after the latest shutdown and debt-ceiling crisis, this is a concern for America’s debtors because it means the political leadership might not be able to stir the U.S. away from the unsustainable long-term fiscal path it is currently on. A paralyzed Congress cannot fix the federal tax system or agree on ways to bring overall health-care costs in line or below the pace of income growth as baby boomers approach retirement. But whether or not Washington can enact broad, sensible and tough-minded reforms will also determine how the country spends its taxpayer dollars. According to the Bipartisan Policy Center, without a major policy shakeup, in 10 years government health programs and social security will take up 60% of domestic federal spending, up from less than 40% two decades ago.
There is, however, another way in which the dysfunctionality manifests itself: inordinate amounts of red tape and bureaucracy. Dodd-Frank, the signature financial reform bill, is 848 pages long. The Affordable Care Act, better known as Obamacare, numbers 906. The immigration reform bill currently working its way through the legislative branch promises to be in the same league. These legislative texts are then usually complemented by even higher piles—running into the thousands of pages—of government-agency regulations. When Congress does work, it tends to produce paper monsters.
It didn’t used to be like this, so how did we get here? The most elegant explanation I’ve read of both these phenomena is that Congressional politics has become “atomized.” In the era of Twitter and crowd-funding, anyone with a decent education and a penchant rhetoric and persuasion can raise money and rally voters. This keen observation belongs to Christopher DeMuth, a distinguished fellow at the Hudson Institute and formerly president of the conservative American Enterprise Institute:
We find ourselves in a world where the slightest cause or interest can easily organize its own advocacy group, and where the greenest backbench legislator can easily set up shop as a policy entrepreneur. It is a world where the old hierarchies of political party and Congress have been swept aside.
The party leadership, in other words, doesn’t have much say anymore on who wins the primaries, what provisions make their way into a bill, and which bills make it to the floor. And the same forces that make Congressional newbies as influential as the old guard also permitted the creation of myriad lobby and advocacy groups, each assiduously working to insert their own twists on new legislation. The overload of unfiltered inputs, according to DeMuth, has short-circuited the legislative process.
DeMuth is mostly focused on the proliferation of federal regulations and regulatory agencies, which he ascribes to Congress having abdicated its law-making duties to the executive. He then goes on to argue that America’s swelling deficits are a predicament of increasingly unchecked presidential power. I’m not sure I follow him that far.
But I do think the premise of his argument is irresistibly persuasive. It makes perfect sense that weakening party and Congressional discipline would produce occasional paralysis, when a rebellious faction such as the Tea Party emerges, and Frankenstein laws such as Dodd-Frank when House and Senate manage to approve anything at all. I also see how this would lead to federal agencies acquiring more power and multiplying–in part because the White House leans on them to get things done when Congress won’t act (see Obama’s pledge to introduce greenhouse gas regulations via the Environmental Protection Agency) and as a naked power grab by the executive.
It makes one want to thank our secretive, disciplinarian prime minister for whip-lashing unruly backbenchers back into submission.
Erica Alini is a reporter based in Cambridge, Mass., and a regular contributor to CanadianBusiness.com, where she covers the U.S. economy.