January 23, 2019

How Do We Get There from Here?



Like David Brooks1 of the New York Times, I find that the Niskanen Center’s policy framework for an “age of extremes” offers a refreshing and sensibly moderate way of spurring more inclusive growth and helping our economy restore faith in the American Dream for many who seem to have lost it. The authors welcome and indeed want to encourage more dynamism in the economy — which is the only way to make it grow faster — but persuasively show that this will not be possible without an expansion of the safety net for those whose lives and incomes are disrupted in the process.  

In my view, the only missing (domestic) piece of their framework is an endorsement, at least in broad outlines, of restoring fiscal sanity to our federal finances through a budget deal that includes, as it must, more revenue, but also changes in entitlement benefits for future beneficiaries. Based on their sensible discussion of other policy issues, I’m reasonably confident the authors would agree that the risk-reducing function of the welfare state is undermined by fiscal irresponsibility that threatens eventual calamity. The authors of the framework also do not discuss foreign policy in much detail, but I am reasonably sure they oppose the movement toward protectionism — cloaked in claims of “fairness” — that is evident in both parties, not only on economic grounds, but because ties developed through cross-border trade and investment are the most effective and least dangerous ways of ensuring a more peaceful world.

The challenge for the Niskanen team — and for the nation, in my view — is political: How can such a sensible, moderate policy framework actually be implemented? I tackle this question here by drawing on the insights of the research and writings of Jonathan Haidt and Daniel Kahneman, both psychologists (though Kahneman has won a Nobel prize in economics for his pathbreaking work with Amos Tversky, who died before the prize could have been shared) who have put forward very closely related theories about how people’s minds work generally and more specifically in a political context.2

The basic idea is that people have two ways of behaving. One is based on their intuition and emotions, the “elephant” in Haidt’s terminology and “system 1” or “fast thinking” in Kahneman’s. The other is based on reason and rationality, the “rider” according to Haidt, or “system 2” or “slow thinking” according to Kahneman. The economist who has come closest to using these distinctions is Princeton’s Alan Blinder, whose 1988 book Hard Heads, Soft Hearts conveys a similar dichotomy.3

Both Haidt and Kahneman argue that most of our daily activities are governed by our elephants, or system 1 reactions. We don’t think, we act, either out of emotion (e.g., fear, anger, or love) or because our brains recognize patterns from our cumulative experiences which enable us to respond quickly.  

Riding, or system 2 thinking, is slower and harder than system 1 reflexive responses, which are inherently reactive. In system 2 mode, or as we ride our elephantine emotions, we are reasoning, weighing arguments from both sides, really thinking. Kahneman tells us it much easier for most to be in system 1 mode, following their elephants, than to carefully reason through a course of action.

Which brings me to the relevance and implications of tribes. Writing with Greg Lukianoff in their new book The Coddling of the American Mind, Haidt argues that humans are also hardwired to belong to groups or “tribes.”4 Once the “tribal switch” is activated, people essentially quit thinking: they follow their elephants, or use system 1, ignoring the rider and system 2. The increased tribalism we see in U.S. politics today is clear evidence of this. Other things being equal, the less pressure people feel, the more likely they are to turn the tribal switch down and be receptive to logic and reason. That explains why, when economies are growing rapidly and widely distributing the fruits of that growth — the U.S. during the postwar era until the early 1970s, for example — there is less tribal behavior. Unfortunately, over the past two decades growth has slowed and not been inclusive. It is no surprise that tribalism has intensified.

It gets worse. The policy framework of neither the left nor the right today promises faster, inclusive growth. Furthermore, both sides have written off meaningful long-term deficit reduction, which threatens the nation’s fiscal soundness and perhaps financial stability at some point.

The “progressive” agenda that seems likely to dominate discourse in the 2020 Democratic presidential primaries — single-payer health care for all, free college for most, some form of a Green New Deal, a national $15 per hour minimum wage, stronger legal protections for unions, and a much higher marginal tax rate on the wealthy but no one else — would reduce inequality and strengthen the safety net, but do little for growth (although increased wages would encourage more automation and thus somewhat faster productivity growth, but also more labor market disruption, which progressives have yet to acknowledge).

The agenda of the right (or Trumpism to be more precise), such as it is, seems to be more tax cuts and precious little else (except for relaxing some environmental and financial regulations and, perhaps, a few bilateral “trade deals”). There is no evidence that any of this would substantially boost long-term growth. Meanwhile, while President Trump at points has promised to protect the safety net for the elderly, Republican members of Congress have threatened cuts not only in Medicare, but in programs that help the poor.

We seem to be caught, then, in the proverbial Catch-22. We are unlikely to reduce tribalism without sustained, inclusive growth, but the tribal movements in both political parties seem to be stacked against adopting the kind of sensible, moderate framework that the Niskanen authors have proposed. Is there any way out of this impasse?

It is possible that the moderates in either party will regain the upper hand if their party loses the presidential election in 2020. Each group will be able to say to the rest of their party that extremism doesn’t work politically, so “let’s return to moderation.” But if current recession threats turn into reality, a worried and likely even angrier electorate is not likely to foster moderation in either party.

It is tempting to hope that a third party will emerge that embraces something like the Niskanen framework. But to have any chance, especially given the hurdles of getting on the ballot in all 50 states, a third party requires both sustained leadership and an inspirational message capable of mobilizing broad grassroots support. Sustainable leadership is important because no political agenda can last if support for it is based only on the charisma of a single individual. Peggy Noonan of the Wall Street Journal has called this the “Magic Pony” syndrome.5

In theory, the 50 or so members of the “Problem Solvers” caucus in the House who work hard on bipartisan solutions to problems are the potential leaders who could champion the Niskanen framework, but with no disrespect to these politicians, few are household names — nor is the group to which they belong known much beyond the Beltway or op-ed pages of major newspapers. Nonetheless, if both parties continue to head toward extreme positions after 2020, it is possible that some of the bigger names in each party could break ranks and bolster the ranks of this caucus, giving it and a governing philosophy like the Niskanen framework much more visibility than it has now. Or perhaps some of our retired military leaders, such as former Generals Mattis, McCaffrey, and McChrystal, who command widespread bipartisan respect, could join such an effort, although relying on generals to save us may be akin to wanting more Magic Ponies.

For something like the Niskanen framework ever to become a permanent part of the governing fabric of the country, it must have inspirational appeal. That appeal can’t rest on villainizing any group — immigrants, “liberals, or “conservatives.” However successful such an approach has been in some cases in the past, what Lukianoff and Haidt call “common-enemy identity politics” is the antithesis of a governing framework that combines the best features of the governing philosophies of the right and the left.6  

Instead, as the two authors recommend, to “win hearts, minds, and votes,” in a way that lasts, one must “appeal to the elephant (intuitive and emotional processes) as well as the rider (reasoning).” And the way to do that, they argue, is to follow the example of Martin Luther King Jr., who humanized his opponents rather than shaming or demonizing them, and urged white Americans to live up to their own ideals as expressed in the Declaration of Independence: “We hold these truths to be self-evident, that all men are created equal.”

One of the co-authors of the Niskanen framework, Brink Lindsey, follows that approach by urging Americans to unite under the banner of “republicanism,” which recognizes that we are all “real Americans” because we all pledge allegiance to “one nation under God, indivisible, with liberty and justice for all.”7 In his speech at the 2004 Democratic convention that launched his national political career, Barack Obama sounded a similar theme when he famously said that there are not two Americas, red and blue, but one United States of America.

The appeal to unity didn’t last for Obama, however. Is there any reason, beyond belief in the power of common sense, that Lindsey’s more specific call for national unity this time under a platform (hopefully with a more bipartisan sounding name than “republicanism”) that combines the best of what both parties have to offer will be any more politically viable and sustainable at some time in the near future?

One reason for optimism is that, contrary to what one might think from watching cable TV or living in the tribal echo chamber of Washington, according to survey data compiled by Stanford political scientist Morris Fiorina, in recent years more Americans have reported themselves to be politically independent than those identifying with either party.8 The falling “market share” of the two leading political brands means that a plurality of Americans could be ready for a new brand of politics in the form of common-sense moderation.

But why do we seem to be more polarized? Fiorina’s answer is that both self-identified Democrats and Republicans have become more homogeneous in their respective views (what Fiorina labels as liberal versus conservative, although President Trump has changed the meaning of that latter term). Furthermore, Fiorina argues that the political differences between party elites the kind of people we see shouting at each other, or vigorously agreeing with one another, on cable TV, depending on the channel, as well as elected officials have widened much more than have differences between voters belonging to the two parties, although those, too, have increased somewhat. Increased polarization in Congress is likely due to the primary system for selecting candidates, which bring the most ideologically committed, or tribal, voters to the polls, and to gerrymandering in many areas of the country that reduces the need for congressional representatives to pay attention to voters favoring moderation and compromise.

It is probably expecting too much to hope that the Supreme Court will fix gerrymandering any time soon. Primaries aren’t going away, either. But if enough of the public eventually sours on the two parties’ moves to the extremes, some prominent elected officials in both parties are likely to follow. On this sequence of events hang the prospects for adopting the sensible Niskanen framework and steering the country’s policies and politics back onto a constructive course.

Robert Litan is a non-resident senior fellow at the Brookings Institution and a partner at Korein Tillery.

Endnotes

1.David Brooks, “A New Center Being Born,” The New York Times, December 20, 2018.

2. See Jonathan Haidt, The Righteous Mind: Why Good People Are Divided by Politics and Religion (New York: Pantheon, 2012) and Daniel Kahneman, Thinking, Fast and Slow (New York: Farrar, Straus and Giroux, 2011).

3. Alan Blinder, Hard Heads, Soft Hearts: Tough-Minded Economics for a Just Society (New York: Basic Books, 1988). His new book, Advice and Dissent: Why America Suffers When Economic and Politics Collide (New York: Basic Books, 2018) updates and extends the relevance of these distinctions, while also explaining why economists (and by extension rational thinking) have only limited influence in the political arena.

4. Greg Lukianoff and Jonathan Haidt, The Coddling of the American Mind: How Good Intentions and Bad Ideas are Setting up a Generation for Failure (New York: Penguin, 2018), pp. 58-59.

5. Peggy Noonan, “A Magic Pony is the Wrong Horse to Back,” The Wall Street Journal, December 13, 2018.

6. See, e.g., Charles Duhigg, “Why Are We So Angry?”, The Atlantic, January/February 2019, pp. 62-75.

7. Brink Lindsey, “Republicanism for Republicans,” National Affairs, Winter 2019.

8. Morris Fiorina, Unstable Majorities: Polarization, Party Sorting, and Political Stalemate (Palo Alto, CA: Hoover Institution Press, 2017).