Has America lost its mojo? In this episode of the Vital Center podcast, we speak with the Niskanen Center’s vice president Brink Lindsey about how the American government no longer seems capable of accomplishing significant, important undertakings — and how that failure is endangering liberal democracy both at home and abroad.
Brink describes his personal journey as a “recovering libertarian,” from a vice president at the Cato Institute to an advocate for robust social insurance and strong, capable government as a necessary complement to free-market capitalism. In particular, he offers an in-depth explanation of the thinking behind his recent manifesto for Niskanen’s new State Capacity Project. He describes how suspicion of centralized state power — shared, ironically, by both the political left and right — led to a degradation in the American government’s ability to carry out ambitious undertakings and even to fulfill its basic responsibilities toward its citizens. The result was what he calls “the often-hapless Leviathan we behold today: an American state whose vaulting ambitions are all too frequently mocked by its faltering follow-through.”
The failure of government institutions during the Covid-19 pandemic was a paradigmatic example of the consequences of declining state capacity. This failure, combined with other recent crises such as the 2007-08 financial crisis, is shaking public trust in liberal democracies around the globe. In this interview, Brink lays out a way to strengthen liberal democracy by bolstering state capacity and laying down the intellectual preconditions for constructive problem-solving. Whether this approach can succeed politically in overcoming the forces of populist reaction and what he calls “civilizational rot” remains to be seen.
Transcript
Brink Lindsey: If you want to see liberal democracy flourish, you better pay attention to liberal democratic governance and make sure it’s making the trains run and bringing home the bacon. And it’s not been doing that. We’ve got a pretty depressing list of government failures and elite failures during the 21st century, and the chickens have come home to roost.
Geoff Kabaservice: Hello! I’m Geoff Kabaservice from the Niskanen Center. Welcome to the Vital Center podcast, where we try to sort through the problems of the muddled, moderate majority of Americans drawing upon history, biography, and current events. And I’m delighted to be joined today by my comrade-in-arms, Brink Lindsey, who is vice president of the Niskanen Center. Welcome, Brink!
Brink Lindsey: Great to be with you, Geoff.
Geoff Kabaservice: And thanks to the miracle of modern technology, we are able to have this conversation today, even though we are almost literally at opposite ends of the earth and it is actually tomorrow where you are.
Brink Lindsey: That’s right. I’m speaking to you from the future. I’m in Thailand, where my wife and I moved in August.
Geoff Kabaservice: And more or less where in Thailand are you?
Brink Lindsey: We are in the city of Roi Et, which is a metro area of about 300,000 about 300 miles northeast of Bangkok. This is my wife’s hometown and we’ve built a home here. And I’m taking the whole idea of remote work to its geographical extreme.
Geoff Kabaservice: And given that many of our listeners will be in Washington, D.C. or other climate-challenged places where it’s cold and maybe even snowy, tell us what it’s like in Thailand right now.
Brink Lindsey: We’re right now in the beginning of the cool season, which is absolutely ideal weather. It’s low humidity, high 80-82, low 60-62, like that every day.
Geoff Kabaservice: That’s good! I’m sure some people are experiencing something like the opposite of schadenfreude. So the main reason that I wanted to talk to you today, Brink, is that you recently put out a manifesto of sorts for Niskanen’s new State Capacity Project, and that is a stellar paper entitled “State Capacity: What Is It, How We Lost It, And How To Get It Back.” And I like that the title in a way simultaneously looks left and right, because on the one hand it’s evoking the mainly liberal focus on governance that we have right now, but it’s also evoking the title of Andrew Sullivan’s book The Conservative Soul, with its subtitle of How We Lost It, How To Get It Back. And I have no doubt that the State Capacity Project is destined to absorb a lot of our energies going forward. But before we get to that, I was hoping that you could tell the podcast listeners something about your origins and what led you to the work that you do now.
Brink Lindsey: Let’s see… I’m a recovering lawyer and a recovering libertarian. Let’s unpack that a bit. I spent about eight or nine years in the private practice of law, mostly doing international trade regulation, representing East Asian companies exporting to the United States and tripped up in various forms of protectionist regulation. I then moved over to the Cato Institute, where I swapped pecuniary income for psychic income, became a policy wonk, and started up their trade policy center. Later I became a vice president there. But over time, like a lot of people that have been at the Niskanen Center, my libertarianism had a rough encounter with the 21st century. And so, back when I was still at Cato, I had this idea that there was a more fruitful intellectual synthesis out there somewhere, taking the best ideas from libertarian thought and the best ideas from progressive thought, and figuring out how they go together. So I launched this whole liberaltarian idea back then. It developed over time. It led me to leave Cato for a while and then come back later. But then when the Niskanen Center got up and running and it looked like its ideological evolution was very simpatico with where I was, I came on board in 2017.
Geoff Kabaservice: Your idea of liberaltarianism goes back to at least 2006, right?
Brink Lindsey: Yes. So that same idea, I think, is very much present in Niskanen. That is, trying to marry progressive recognition of the need for wide-ranging activist government with libertarian appreciation of competitive markets, suspicion of centralized power, and alertness to how even well-intentioned government policies can go badly wrong. Back then I was still much more on the libertarian side, and less… My sense of the need for large government has shifted since then. In particular, I now see a robust, healthy, public sector — and in particular, robust social insurance — as a vital complement to a free market rather than, as I did for quite some period of time, seeing the welfare state as an antagonist to the free market. So I had a big ideological switch. But I think that the underlying values are all still the same — just trying to figure out how to find the best means towards those ends.
Geoff Kabaservice: You know, the first time I learned about you, Brink, was when you came out with your second or third book, The Age of Abundance: How Prosperity Transformed America’s Politics and Culture in 2009.
Brink Lindsey: 2007.
Geoff Kabaservice: Oh, 2007 was it? Okay.
Brink Lindsey: That’s very important because 2007, I believe, is the last possible year for anyone to title a book “The Age of Abundance” unironically.
Geoff Kabaservice: But it actually did seem, at that moment, that the culture wars had ebbed somewhat and that prosperity was largely implicated in Americans feeling better about themselves and each other at that moment.
Brink Lindsey: Yes. At that time I made the argument that we had been through this sturm und drang of culture wars, but that we had come out the other side by the ’90s with a whole lot of social indicators improving after crime and family breakdown. All kinds of social indicators had gone haywire during the ’60s and ’70s and seemed to re-equilibrate during the ’90s. And I made the case that we had found a new cultural synthesis that retained a belief in capitalism, commercial society, bourgeois values, the nuclear family — so all of that survived the assault of the ’60s — but married it to a much more inclusive vision of who counts in American life, much different ideas about race and sex and the role of women in society. And so I saw the sort of hump of the bell curve in American public opinion as moderately libertarian-ish in its thinking.
But as I noted at the time, politics was still reactionary. You had, the way I framed it at the time, the left still unhappy with the degree of free markets and the right unhappy with the consequences of the ’60s cultural revolution. And so I argued at that time that politics was in a reactionary rut, with both sides pining for the 1950s: the left wanted to work there and the right wanted to go home there. And I was hopeful at the end of that book that we could find a new, purple consensus and get past that reactionary carping. Alas, things went completely off the deep end as the right went insane, and now elements of the left are trying to mimic them. So alas, politics did not go in the moderate, purple-ish direction that I was hoping. And you knew that because you chronicled how all of that crashed and burned.
Geoff Kabaservice: You used a phrase that we sometimes use around the Niskanen Center — altering it slightly from what you said — it’s that we try to draw upon the best of progressive and conservative thought.
Brink Lindsey: Yes.
Geoff Kabaservice: One of the very few things that progressives and conservatives seem to have in common nowadays is that they both hate libertarians. And they will regard libertarians as either an unholy amalgam of things that don’t belong together — like a manticore of political philosophy, with the head of a man and the tail of a scorpion and the body of a lion — or maybe like a clock that’s right twice a day because it’s stopped. But there’s elements of both left and right in libertarianism to begin with, are there not?
Brink Lindsey: Sure, sure. And I will say that on the part of libertarianism that doesn’t have to do with economics, I’m still pretty strongly libertarian. So I’m a civil libertarian. I’m suspicious of U.S. military adventurism. I believe in personal freedoms and am suspicious of the nanny state. But when it comes to, again, the need for government to act as the ultimate absorber of risk to shield individuals from the uninsurable hazards of life, I think the role of social insurance — which requires a big government, or at least a big-spending government — is one that I now see as a necessary component of well-functioning capitalism rather than as a parasite upon healthy capitalism.
And likewise, I’d always seen some element of regulation as necessary. But it’s clear these days in the 21st century, as we had the financial crisis demonstrating that for an inevitably regulated financial sector, the question isn’t less or more government — it’s whether you regulate it correctly or not. And now we have this looming challenge of climate change, which is necessarily a regulatory problem. Just pretending it’s not there is the default libertarian approach, and I came to see that that was insufficient. So, still a lot of libertarian ideas swimming around my head — I still, like I said, think that that centralized power can be extremely dangerous and that top-down control can be extremely ham-fisted. But again, I now see those as ideas that are tools to help make things work better rather than to dismantle what we have.
Geoff Kabaservice: And a lot of that recalibration in your perspective is captured in your 2017 book with Niskanen senior fellow Steve Teles, The Captured Economy: How the Powerful Enrich Themselves, Slow Down Growth, and Increase Inequality. And one of the big insights that I took from that book is that although people on the right (and even the center-right) complain about regulation in terms of, let’s say, government regulation that impedes economic growth, you wrote that there was another kind of (or domain of) regulatory activity with a very different character. And this is where, instead of imposing costs on business to further a social purpose, these rules impose costs on society at large in order to aid business.
Brink Lindsey: Yes.
Geoff Kabaservice: How did you come to that revised perspective?
Brink Lindsey: So yeah, there’s the conventional left-right divide on regulation based on specific kinds of regulations — namely health, safety, environmental workplace regulations that impose costs on business to further some social objective. And so you get a very natural division of opinion. You’ve got business and the pro-business right saying, “These regulations are too burdensome. They are throwing sand in the gears of the free enterprise system.” Meanwhile you have the left saying, “No, these are necessary guarantors of important social values. You’re just arguing for businesses to be able to impose costs on the environment and workers, etc.” So they argue back and forth, and they split the difference — and often the truth is somewhere in the middle.
But there’s a whole different domain of regulation, as you mentioned, where it’s best described not as imposing costs on business but rather imposing costs on society to further particular businesses. And there you have this possibility of a transpartisan convergence. So normally you have progressives thinking about defending the regulatory state, but they don’t like plutocracy. And so when they see the regulatory state captured by plutocracy, that makes them think again. Likewise, conservatives are instinctively pro-business. But when they see business becoming a kind of crony capitalism that’s captured the state and profiting through politics rather than through building a better mousetrap, that makes them feel squeamish about their pro-business instincts.
So the book arose when I was still at the Cato Institute and Steve Teles had not yet affiliated with the Niskanen Center either — he was at Johns Hopkins. And so the idea was to write a liberaltarian book to show that there was a suite of policies, namely these regressive rent-seeking regulations that redistribute income and wealth up the socioeconomic scale… that there was this suite of policies that were really important because they were seriously undermining growth and dynamism in the economy while exacerbating high and socially divisive inequality. And also there were reforms to these policies that could appeal to libertarians for libertarian reasons, and to progressives for progressive reasons. So this was an early sort of test run for the larger game plan of the Niskanen Center, which was to find transpartisan policies — not bipartisan compromise, split-the-difference policies that both sides have to hold their nose and meet in the middle, but rather policies that synthesize both sides and give good left-wing reasons and right-wing reasons for supporting them.
Geoff Kabaservice: And this book actually made a pretty big splash in the world of somewhat wonky policy analysis. I would group it with books like Paul Collier’s The Future of Capitalism, for example, that are basically trying to save capitalism from itself. I wonder if you feel like this book has actually had real-world political consequences as well, if you think that there’s more attention being paid to a lot of the concerns that you raised in that book.
Brink Lindsey: I don’t think any of my books have made splashes, but this one made some ripples. I’m not sure our agency mattered that much, but I think we rode a tide of shifting opinion — that maybe we got on that wave before other people. And so I think this idea that regulatory capture — or just capture, policy capture of government, where insiders wield excessive influence and do so in a way that’s bad for everybody else — is an idea that’s caught on. And so we did four case studies in the book of policy areas where we thought this kind of rent-seeking capture had gone on: the financial sector; intellectual property (patents and copyrights); occupational licensing (especially for doctors and lawyers, high-end professionals); and then finally zoning and land-use regulation.
Geoff Kabaservice: And I feel obliged to point out that our friend and colleague Dan Takash still updates the capturedeconomy.com website, where he provides updates in all of these four areas.
Brink Lindsey: Correct. That looked like a really weird regulatory reform agenda when we trotted it out. Of course, finance — everybody knew about that beforehand. But the others all seemed: “Well, how do those go together?” But I think there’s been significant movement on all those, especially on land use where this YIMBY movement — which really does bring together right-of-center deregulators and left-of-center affordable-housing and anti-sprawl, Green people — that’s a really interesting development. And so, yes, I think that although this is hardly a favorable environment for governance or policy-making on many, many different fronts, there has been some positive movement in the realm of ideas and some policy changes that are — especially on occupational licensing and land use that we’ve seen at the state and local level — that things have started to move in the right direction.
Geoff Kabaservice: For example, SB-9’s passage in California, which basically did away with single-family zoning.
Brink Lindsey: That’s right. And we’ve seen that elsewhere as well. So we’re discovering with land use, the problem isn’t NIMBYs per se, the Not-In-My-Backyard people. Of course immediate neighbors of any construction project are going to have a natural hostility to that project for many different reasons, creditable and maybe dishonorable as well. But it’s almost inevitable. The problem is that land-use policy is decided on this extremely hyper-local basis — basically plot-by-plot — so that the immediate neighbors, out of all the vast and dispersed interests affected by land use, the immediate neighbors have wildly disproportionate influence over outcomes. And so even if you have state regulation, we still have this baseline of hyperlocal regulation, and they fight back in all kinds of different ways. So it’s going to be a long slog to push things in the right direction. But it does feel like people understand the problem, and there really has been a shift in opinion.
Geoff Kabaservice: To move toward the state capacity issue… You’d mentioned earlier the idea of being at the forefront of a wave. And I feel like there’s a lot of that kind of energy now around, I guess, a perceived loss of dynamism in America, a lack of ability to govern effectively, a lack of ability to do big, ambitious things. One for example sees just this week an article by Derek Thompson at The Atlantic called “America Is Running On Fumes,” where he’s really cataloging the shift from exploration to incrementalism in often very disparate fields, such as the number of original blockbuster movies that come out of Hollywood, or the decline of originality in science, or the decline in research productivity across a number of industries, the decline in business formation in this country. If I were to put you on the psychologist’s couch, I wonder whether some of the origin of our interest in state capacity may not come from your youthful interest — some would say obsession — with NASA and the space program.
Brink Lindsey: Yeah. So your tale of 21st-century American malaise is absolutely a narrative that’s picked up a lot of steam. You basically just summarized Ross Douthat’s The Decadent Society. Coming from very different ideological quarters, Peter Thiel’s “They promised us flying cars and we got 140 characters” is a similar lament. And yeah, I was about to turn seven when the first moon landing occurred. It completely rocked my world. I was, like many kids, very enthusiastic, and these were my heroes. I took my enthusiasm to the nth degree. I have signed autographs, signed photos of every single astronaut from the Apollo era. And that was the last hurrah, in retrospect, of the golden age that we now look back on in American state capacity, where America was capable — putting aside whether everything it did was wise or defensible, but it could set out to do big things and accomplish big things. And many of them were immensely valuable, starting with World War II mobilization, and then the Manhattan Project, and then following up in the early Cold War with the Marshall Plan and the Berlin airlift. These were all mammoth logistical undertakings.
Then we had the interstate highway system that was launched in the 1950s. We had a very different experience with mass vaccination with polio in the ’50s than what we’ve had now. And then, finally, Project Apollo, setting just an insanely audacious goal of landing a man on the moon within a decade and pulling it off. We then, from that late ’60s boyhood, we went into the ’70s where everything seemed to be falling apart. And so, back then, I saw that the future that I had hoped for wasn’t going to materialize, and I was persuaded back then that the main cause was overweening government. And so it was the disillusionment of the ’70s that recruited me into the small-government, libertarian cause.
I think that cause needed to arise. By the late ’60s, early ’70s, you had one-third of humanity living under regimes that were dedicated to the proposition that private property and competitive markets should not exist. You had the free world having had explosive growth in government and apparently open-ended growth in government, and the smart set generally thinking of inevitable convergence between the socialist countries and the democracies. And so there was, I think, a screaming need for people to stand up for the important if partial truths that markets work and that top-down control has severe limitations. I think the marriage of that partial truth with the times was a pretty good one in the ’70s and ’80s, but had become rocky and even toxic by the ’00s and the ’10s. And so now I look back to the old days of state capacity and see that there were things we knew back then that we’ve forgotten and that we need to relearn.
Geoff Kabaservice: Yeah. And you’re mentioning the big ambitious projects like the Marshall Plan or putting a man on the moon. But of course the space program exemplified other aspects of what Philip Zelikow, in a recent conversation with me, called “the can-do spirit of America.” And I grew up with the legends of the engineers on Apollo 13, which were captured very well in Ron Howard’s film, where they have 24 hours to solve a seemingly insoluble problem. And they do with duct tape and cardboard tubes and they get it done. And the ’70s certainly did seem to usher us into an era where that kind of can-do spirit was no longer something that characterized America or Americans.
Brink Lindsey: Just to pivot into a more wonky direction, I just read a book called Across The Airless Wilds, about the Lunar Rover program. 1971 is the 50th anniversary of the first moon buggy. So the last three Apollo missions were much more ambitious than the early ones. They went to mountainous regions. They had these cars where they could drive around up to 20 miles. And they could do real science; the final mission actually brought a geologist along as well. So even though the public had basically lost interest in the space program by then, after we beat the Russians and got on the moon, that was really when the most exciting lunar exploration actually occurred, and the Rover was key to that. But it was very much a last-minute thing. And so this book is basically telling the inside story of how it was developed and then how these missions used it.
And what’s just an amazing story — and he goes back and finds the NASA officials and the contractors — was the in-depth inter-penetration of NASA into the private contractors, and the degree to which they had immense in-house expertise that allowed them to then leverage that with private business, with private contractors, but in a way where they never for one second lost control of what was going on. So it was a demonstration of how government can work in public-private partnerships that has been completely lost because of the wild overreliance on contractors that we see today.
So one thing I discuss in the state capacity paper, on the subject of the federal workforce, is the utterly astonishing fact that the federal civilian workforce of about two million people is about the same as it was in the early 1960s. So for basically almost 60 years, the federal workforce hasn’t grown, at a time when federal spending has increased (in inflation-adjusted terms) fivefold and the scope of government has just exploded with the environmental, health, safety, consumer regulation — much wider social insurance programs than we had before. And yet the number of people in Washington — full-time civil servants — to manage and oversee and coordinate all of this has stagnated. And the gap has been filled with this extremely heavy reliance on contractors — which is not necessarily bad, but when the in-house people don’t have the bandwidth or expertise to oversee the contractors, then you have what political scientist John Dilulio calls “Leviathan by proxy.” You have unaccountable government that’s for private profit.
Geoff Kabaservice: You offered a very subtle historical analogy in your paper where you said, “Even before the United States was a nation, we relied on subcontractors to some extent” — by which I take it you meant the Hessians?
Brink Lindsey: Well, the Hessians were with the Brits, weren’t they? We beat the Hessians, but we subcontracted out to the French.
Geoff Kabaservice: Okay, okay.
Brink Lindsey: But in the Revolutionary War, there were private companies that supplied military materiel etc. So private contractors have been there from the origin, but the dog and tail have switched places.
Geoff Kabaservice: Most of our listeners might not be familiar with this concept of “state capacity.” In simple layperson’s terms, how would you define it?
Brink Lindsey: It’s a term of art that was originally come up with by political scientists, and development economists, and economic historians as one element of the big story of modernity. Why did some countries get rich and other countries not? And you see that on the rich country/poor country divide, you also see a strong state/weak state divide. So that rich countries are associated with large, capable states — or at least strong, capable states, not necessarily large, and they could be relatively modest in the scope of their activities. But what they do, they have to do well. And in particular they have to be able to raise taxes and secure public order, and then provide those public goods that are necessary for the market to function — one of which is a legal system, but beyond that.
So this idea of state capacity was come up with originally as a dimension for comparing economic and social development, and in particular for contrasting high state capacity/rich countries with low state capacity/poor countries. And then at the extreme of that continuum, you have failed states, where state institutions have broken down altogether. But then a funny thing happened. We had this pandemic — not very funny at all. But we saw high-capacity states like the United States — which was thought to be, with the CDC, the unparalleled leader in infectious disease control — doing very poorly. Lots of western European countries doing very poorly, while poor countries like Vietnam and Thailand did much, much better. So this was a catalyst for the origins of this program, just in general: the shambolic U.S. response on the public health side to the pandemic.
But then the miraculous Operation Warp Speed success in getting vaccines developed in record time illustrates that state capacity is a very granular thing. And so it’s a much more complicated idea when you’re applying it in reality, or at least when you’re applying it in the present, than the big, sweeping aggregations in how it developed. We definitely saw, during this time, the government failing to do its most elementary thing, which is safeguarding the physical safety of its citizens. And it was out of the chagrin that this had happened, and that we have fallen so low — and not just because of Trump and his crazy political antics and his boosterism of bleach and so forth, but real dysfunction at what were thought to be premier agencies like the Centers for Disease Control and the Food and Drug Administration, that really did very poorly in helping the country navigate this crisis.
Geoff Kabaservice: So although there’s a lot of ways to approach the general subject of state capacity, I thought you nailed the focus with admirable concision. “Our focus,” you said, “is on the underlying ability of American government to formulate an execute policy in a competent fashion.” Right?
Brink Lindsey: And we see that under stress, or not there in a lot of different domains.
Geoff Kabaservice: So let’s start into the second of your questions about American state capacity: How did we lose it? Can you tell me something about the reading that you did on this subject that went into your writing of the paper?
Brink Lindsey: I read a lot. The space I frequently occupy as a writer is somewhere between the superficiality of an op-ed writer and genuine, bona fide expertise. So it’s this middle ground where you really have to dig into details, but on a wide range of issues that you couldn’t possibly match the subject-matter expertise of specialists on. So there were a lot of internal conversations at Niskanen about what does this state capacity idea mean? And lots of talking with smart people, and lots of reading, and lots of reading about what went wrong.
And particularly, on the historical side, I came to see this really interesting story that implicated both the left and the right. And that is really captured by the fortuitous publication — within ten days of each other, I think – of two historical narratives that began in the ’60s. One is by Amy Fried and Douglas Harris called At War With Government — a history of the anti-government, anti-statist, libertarian-inflected conservatism from Goldwater through Trump. It’s arguing that throughout this period the through-line of the American right has been instilling fear and distrust of the federal government and the citizenry for political gain — although I will say often there are good reasons for that fear. But then also at the same time — or just a few days later or a few days before, I can’t remember which — a book by Yale history professor Paul Sabin called Public Citizens, about the rise of Ralph Nader and public interest liberalism.
I think, before going into detail, the story is that both the left and the right contributed to a decline in state capacity through dysfunctional expressions of legitimate fears of centralized power. So as I said before, I think the libertarian movement needed to happen. There was real overreach and real complacency about the capacities for technocratic control that needed pushback. And yet that corrective — which saw some really fruitful policy-making in the ’70s and ’80s, stripping away economic regulation and so forth — curdled into a mindless hostility towards the public sector whenever it’s trying to help people. So, not worrying about centralized power when it’s actually wielding guns; police and the military were basically exempt from conservative government skepticism. But anytime the government was actually trying to help people, or make people’s lives better, we came to this point where the right’s knee-jerk is to deny that such things are possible and to say that the government is a racket, and everything it does is bad, and it can’t do anything right — which becomes a self-fulfilling prophecy.
Meanwhile, you had a very interesting anti-government libertarian moment going on on the left, which has been largely forgotten about. For instance, it’s forgotten that in the deregulation movement of the ’70s, Ralph Nader was an outspoken champion of trucking deregulation, and Ted Kennedy was basically the author in Congress of airline deregulation. So where did this come from? Coming out of the New Deal left into the New Left of the ’60s and ’70s, you had progressives — or liberals, or lefties at that time — not comfortable with wielding big, centralized power as New Dealers had been, but really freaked out about the abuses and dangerous potential of centralized power.
Most obviously, centralized power could destroy the whole planet with nuclear war, so the bomb hung over everybody. Then we had a war, a misbegotten war in Vietnam that was killing young people’s contemporaries. Then you had the Civil Rights movement that was featuring state officials firehosing peaceful protestors. So there were a lot of good reasons back then for people on the left to make “Question Authority” their byword, right? Yet at the same time they were not pro-market, laissez-faire people. They thought that there was a huge need for expanded regulation to protect the environment, to protect health and safety, protect workers. And so there was a huge expansion of the regulatory state in the ’60s and ’70s, but it was done in a very different way. It was done by inserting, at a hundred different points in the system, openness to challenge by the public in the courts.
New Dealers had been quite allergic to judicial review. They wanted to run the show and be accountable at the polls. But Nader and his type — and I could also throw in Jane Jacobs, a hero of the left back in the ’60s for standing up to Robert Moses and his imperial and imperialistic urban planning and demolition of whole neighborhoods without much input from the people who lived there… So there was the idea that that government needed to be held to account by “the people,” which technically turned out to be self-appointed guardians of the people or spokesmen for the people — public interest groups, public activist groups — who would have standing to sue and hold the government to account. What this then ultimately… And the National Environmental Policy Act, which instituted environmental review, is one element of that larger program. But what that has metastasized into is basically a tool for ensuring that nothing ever gets built ever, because there is an endless parade of people who can sue and hold things up and institute delays. And delays mean higher costs, and higher costs then ultimately mean the whole thing has to be shelved.
So we have two flavors of distrust of government — again, with good reasons. One leading to “Let’s devolve power to the markets.” That was a good idea to some extent, but then like I said curdled into mindless anti-government. And then you had “Power to the people,” which sounded good, but the people turned out to be litigators. And really it turns out that although public interest groups can punch above their weight, business interests are the best litigators of all. And so as law professor Nick Bagley has pointed out in his masterful law review article “The Procedure Fetish,” this proceduralism run amok has actually perversely worked against progressive aims by expanding the ability of business to dominate legal proceedings and to scare agencies often into inactivity, which is preferable to getting dragged through the courts. So that’s the larger story of how an understandable distrust of government got expressed in dysfunctional ways and led us to cures that were worse than disease.
Geoff Kabaservice: Coincidentally, a few days ago marked the 56th anniversary of the publication of Ralph Nader’s book Unsafe At Any Speed. The focus of that book was on the Chevy Corvair. One of my dad’s best friends owned a Chevy Corvair at the time the book came out and never forgave Ralph Nader for casting aspersions on this beautiful car. If you actually want to see a Corvair, you can go to the Museum of Tort Law in Winsted, Connecticut — probably not one of America’s most visited museums, but it’s basically in Ralph Nader’s hometown. He put the museum together and there are several Corvairs on display there.
Brink Lindsey: I don’t know if they still exist, because they’re old cars, but I remember through the ’80s and ’90s, there were Corvair clubs of people who owned them. And they would get together and drive unsafely at any speed.
Geoff Kabaservice: And you could actually go quite fast in a Corvair, too.
Brink Lindsey: Yeah.
Geoff Kabaservice: So I’ve got to admit, I was a little skeptical when I read your explanation of how we got declining state capacity — because, as an intellectual, you located it in ideas and institutions. But I actually was very convinced by what you wrote, particularly about this unfortunate coming together in the 1960s and ’70s of, on the one hand, a massive expansion in the scope and complexity of American government but also American regulatory and social policy. And then also at the same time, changes in the ideas and institutions on both the left and the right that, as you put it, worked systematically to degrade government’s ability to meet those demands. And in a phrase that I was rather taken by, you said the result was “the often-hapless Leviathan we behold today: an American state whose vaulting ambitions are all too frequently mocked by its faltering follow-through.”
Brink Lindsey: Yeah. And I don’t want to say that the ideas are the whole story. I think they’re an interesting part of the story that I wanted to highlight. In his book, the second of his two volumes on public order, Francis Fukuyama has a narrative about a decline of state capacity which I think is also an important part of the story. That is that state capacity is declining every day, naturally, both because the times change and policies that were well matched to a particular set of challenges will fall out of alignment with what’s going on in the world. And people’s ideas will not keep up with new challenges, and there will just be inertia, and there will be interest groups, and intellectual interest groups built up around the status quo defending it. And the times change, and people don’t adapt quickly enough.
Meanwhile, as Mancur Olson argued, whenever you’ve got concentrated benefits and dispersed costs, you have incentives for small groups to organize and to divert some portion of public resources their way. And the longer you have peace and prosperity, the more these barnacles will attach themselves to the ship of state. And so just naturally, over time, you have inertia leading government (unless it’s constantly being upgraded and maintained) to lose its mojo, while at the same time you have it being progressively debilitated by distributional coalitions and narrow interest groups that are diverting public power to private purposes.
And I think throughout this whole period we had, in addition to the ideas that I talked about, just complacency. So you had the right thinking that state capacity is just fine — the problem is there’s entirely too much of it, we need to pare it back — and not recognizing that there was a risk on the other side. And then you had progressives engaged against a libertarian-inflected right, spending all of their energy arguing that government needs to get bigger, rather than spending any energy on maintaining that expanded government and making sure it works well, or spending commensurate energies on that. And so there was a natural process of decline as well, but I think the ideas helped importantly to steer people into not seeing the decline that was going on under their noses.
Geoff Kabaservice: There’s probably no human social phenomenon that can’t be described as, on the one hand, a product of impersonal tectonic forces over time, and on the other hand, specific local circumstances. But your explanation does fit really well with our current political moment as well, in which the basic dynamic between a left and right party seems to have broken down. Sometimes the Republican Party, as I found in my research, would put forward the more “progressive” policy, but usually it was the Democrats expanding the size and ambition, let us say, of government and the state. And usually it was the Republican Party that would, I would say, condition that ambition by reality-checking it — not dismissing it but at least asking some of the practical, pragmatic questions about how government would work in practice. And that dynamic really seems to have utterly broken down in this era when the Republican Party has no interest whatsoever in governance, seemingly.
Brink Lindsey: That’s right. So I would say that the ideological stranglehold of Reagan’s “The nine most terrifying words in the English language are ‘I’m from the government and I’m here to help’” — that has lost its luster. Trump’s nomination in 2016 demonstrated that someone could run on saying, “I’m not going to cut Social Security or Medicare” and win the nomination against a bunch of (at least nominally) small-government conservatives. And yet the fall-away from governance has been so complete that we saw no 2020 Republican platform. And just yesterday, I guess, Mitch McConnell announced that there will be no legislative program for the Republicans in 2022 prior to the midterms.
So certainly no hard-charging campaigning for small-government reforms these days. But what is left is just the only idea in the heads of Republicans these days is “Anything the Democrats want is evil.” And so, since Democrats really have moved to the left from the Clinton New Democrat days to hunger for bold progressive action, and particularly on expanding the welfare state on healthcare and otherwise… So we’re still stuck in the same partisan polarization on one side wants to expand, one side wants to stop the other side from expanding, and nobody’s paying enough attention to making things work right. We see this going on right now in the Build Back Better bill and in the infrastructure bill that passed, spending great gobs of money —a lot of which is needed — but paying relatively little attention to the fact that infrastructure in America is insanely costly, even relative to rich countries, and rich countries with lots of environmental protections in western Europe.
And so until we can improve state capacity to do infrastructure by cutting through all these Lilliputian fetters that currently bind the American state when it wants to build stuff, then we’re going to spend a lot of that money and not have too much to show for it. So right now, we’re seeing the cost of this impasse playing out, and Democrats realizing, I think, correctly, that liberal democracy is under stress. And one way to get people to believe liberal democracy is worth supporting is to see that liberal democratic governance can actually deliver the goods, that it can actually act in a visible and comprehensible way to help ordinary people in tangible ways.
Geoff Kabaservice: Could I get you to expand on that, Brink?
Brink Lindsey: Yeah. And so I think that idea is correct, but if they don’t have a state capable enough for doing the carry-through, you’ll have excitement when the big bills are passed but then disillusionment when they don’t pan out. So I think… You can stop me there to phrase your question, but I think the stakes of state capacity go beyond just our capacity to have good policies that meet the challenges of big problems facing the country. But really the legitimacy of liberal democratic governance is embattled now, not just in the United States but around the world. And so I think state capacity is an important front in this larger battle to rescue liberal democracy from this current legitimacy crisis it’s experiencing.
Geoff Kabaservice: And I guess that was just what I was going to ask. It seems to me that a lot of the crisis of liberal democracy around the globe stems from the 2007-08 financial crisis and everything that has followed from that. And on some level, if liberal democracies can’t make their governments and states work effectively, then liberal democracy will fall.
Brink Lindsey: Yeah. And just genealogically, this State Capacity Project at Niskanen is an outgrowth of our Open Society Project which we created in the aftermath of the 2016 election, seeing that there was a crisis of liberal democracy and that the Niskanen Center wanted to plant its flag on behalf of Team Liberal Democracy and in opposition to the waves of populist authoritarianism that were challenging it. And we’ve done a lot of good work on that project over the years. But one thing we discovered, making us sadder but wiser, is that the number of people with a real, principled commitment to liberal democracy — that is, a commitment that is upstream of their partisan identification and policy preferences — is pretty small. So if liberal democracy is under challenge, expecting principled liberal democrats to beat back the extremists in their party these days is a naïve expectation. Because there’s just not that much principled support, and there probably never has been.
When we look historically, the fortunes of liberal democracy rise and fall based on brute facts about how well liberal democracies are doing. So during the interwar years of the Great Depression, liberal democracy nearly left the planet altogether. But then after winning a total war against fascism, and securing western Europe against Soviet incursions, and then ushering in this huge postwar boom with economic miracles in Germany and Japan, we saw a lot of democratization post-World War II. And then, with the collapse of the Soviet Union and “the end of history,” and the U.S. having this glorious ’90s boom, and the Internet happening, you saw this third wave of democratization. And then finally, again, now after the financial crisis we’ve had what has been termed a “democratic recession.” So bottom line, if you want to see liberal democracy flourish, you better pay attention to liberal democratic governance and make sure it’s making the trains run and bringing home the bacon. And it’s not been doing that. We’ve got a pretty depressing list of government failures and elite failures during the 21st century, and the chickens have come home to roost.
Geoff Kabaservice: So to turn to the third subhead of the subtitle of your paper, how to get state capacity back… You suggest, in a passage that I think is worth reading at length, that “What is needed most is a change in ideas: namely, a reversal of those intellectual trends of the past 50 years or so that have brought us to the current pass.” On the right this means abandoning “the knee-jerk anti-statism of recent decades,” and on the left it means reconsidering “the decentralized, legalistic model of governance that has guided progressive-led state expansion since the 1960s.”
Brink Lindsey: Yeah. So I think the first step is seeing there’s a problem. I didn’t see there was a problem for a long time while all of this was happening. Like many libertarians, when I saw the latest Gallup or Pew results on trust in government and they were even lower than they had been the year before, I thought that was good news. I thought people were waking up, that people had been gullible and too credulous and too trusting of government. And when they finally saw it for what it was, that they would open their eyes, and we would be on our path to Libertopia. That was a widespread view. And I didn’t want a capable state. I thought it was entirely too capable, right? But what we’ve seen is that loss of trust of government isn’t loss of trust in raw power and charisma. It’s loss of trust in established democratic institutions and governing institutions.
So this falling trust is not the preface to some gleaming libertarian future. It’s a gateway to vulnerability to demagoguery of the worst sort, which is exactly what we’ve seen. When people lose trust in established institutions and governing elites they go into the market for snake-oil salesmen, and we’ve got lots of them out there right now peddling their wares. And I think there are people on the right, there is a real ferment on the right questioning the old Reaganite dogmas. And so we see that at places like American Compass, we see it in Mitt Romney’s proposal for a child allowance, we see Marco Rubio nosing around for a common-good capitalism. So we see that happening there.
And on the progressive side, I think there is a recognition that good intentions aren’t enough. Now, in this crisis atmosphere, there’s a recognition that if the government can’t actually do what it says, that we’re going to lose everything. Just to name one example, Ezra Klein, someone who wasn’t thinking a lot about state capacity and these kinds of issues during the George W. Bush years when he first made his mark, has written a couple of columns recently for the New York Times, one about how California makes progressive squirm. The progressive conceit is that the only problem with the country is there’s too many damn Republicans, and they win elections, and they get in our way, and they stop us from doing stuff. But California is the “be careful what you wish for” monkey’s paw. Progressives completely dominate the state and yet it is rife with governance dysfunction, as Ezra pointed out in that column, which shows that there ought to be more to the progressive faith than just handing power over and handing money over to government. It’s got to be designing policies so they actually work. And recently, he had this manifesto for “supply-side progressivism” — that is, that a competent public sector that actually can overcome supply constraints in healthcare and land use etc. would do more to further progressive values.
So you’re seeing people on the conservative side and people on the progressive side, for conservative reasons and for progressive reasons, coming around to the idea that there is a real big problem and that we do need a government that is capable of doing its job. We can argue about what that job is, but there is a lot of consensus on what elements of that job are. And so there is at least, if we can somehow or another get through this horrendous dysfunctional politics we’re in, where we can have some space for constructive problem-solving, I think there is… The intellectual preconditions for that are starting to unfold.
Geoff Kabaservice: I note parenthetically also that Ezra Klein was quite interested in the recent Niskanen paper from Steve Teles, Sam Hammond, and Dan Takash on cost disease socialism.
Brink Lindsey: Yes, which he cited in his supply-side progressivism piece, exactly.
Geoff Kabaservice: Right. So we’ve already established that we can’t cover the entire waterfront of every issue that might be implicated in state capacity decline. But we’re going to have a look, as you write in your paper, at five specific areas, which are probably among the most important. The first of them is expanding and upgrading the federal workforce. The second is improving tax collection and closing the tax gap between what is actually assessed versus what’s collected. The third is overhauling how the federal government acquires and uses information technology. The fourth is streamlining environmental review to reduce delays and cost overruns in infrastructure construction. And the last is revitalizing the country’s sclerotic public health institutions to be better prepared for the next pandemic than we were for this one.
Brink Lindsey: Yeah. So the fifth one is a little bit different from the others, in that it is really about a policy area, about public health and specifically about pandemic response. But we identified that policy area as critical, first, because the failures in that policy area were really an important inspiration for this project. Now, with the Omicron variant, we see this pandemic is still not behind us and we’re still not learning the lessons that we should have learned, still mismanaging things. And we have the grim near-certainty this is not the last pandemic we’re going to go through. We had several already in this century that had the potential to go global and we lucked out. We’ve had this one, which went global, but is not nearly as lethal as some could be. So we’re still staring down this barrel. And there’s just no more important function for government than keeping its citizens alive. So we included that as a standalone policy area within the state capacity frame.
The other four areas are all institutional reforms that, if progress is made, would allow government to be more effective across the board, across policy domains. Just to sort of anthropomorphize: the federal workforce, first, the government has to have a healthy body. As I mentioned, right now, the federal government’s a 98-pound weakling getting sand kicked in its face by contractors. Secondly, the tax gap. So first you have to have healthy body, and then secondly you have to be able to feed yourself, right? You have to be able to get the resources that give you the energy and the resources that allow you to act. So when the government has basically whacked away the IRS’s enforcement budget over the past decade or more by something like 25% — something like that, I can’t remember the exact number — allowing high-income taxpayers who earn income in non-transparent ways (rather than just on W2s) to evade more and more of their obligations even as tax rates have gone down, the percentage of the taxes they owe is going down as well. That’s element number two.
Also, federal information technology. The government has to be able to think. It needs to be able to process information to be able to act. And once upon a time, the government was the patron/facilitator/pace-setter of the computer revolution. The early computers were designed to calculate first artillery trajectories, and then the actual word “computer” was used for women who would do those things by hand. Then we developed mechanical computers, and then finally electronic computers to do the huge database of Social Security and to do war gaming and to do nuclear weapons development and testing. So in the early days, the federal government was the source of the computer revolution, but it took off and found huge private sector applications beyond government contracting. And now we’re to the point where the government is this pitiful laggard in not even being able to use off-the-shelf information technology competently.
So: healthy body, feed yourself, think clearly. And then finally the government has to be able to move in physical space. That’s the infrastructure/environmental side. So I used this anthropomorphic metaphor to think through the most vital areas where government needed to be shored up. And then finally the policy area of pandemic control: that most of all we need government to keep us alive from viruses that are trying their devilish best to stop that.
Geoff Kabaservice: And we’ll be going deeper into each of these areas in the future, of course. But I did want to point out that it’s from the information technology world that the term “kludge” comes from, from which Steve Teles derived his term “kludgeocracy.”
Brink Lindsey: Yes.
Geoff Kabaservice: And you also pointed out the real contradiction in the libertarian approach specifically to this area. On the one hand, you starve the government of the funds it needs to have effective information technology. Then you blame the government for being unable to do the things that it can do only with effective information technology.
Brink Lindsey: Yeah, it’s a nice one-two.
Geoff Kabaservice: So I suppose, as a closing question, Brink, the thing that bothers me a little bit about this is that you’ve described a very practical, pragmatic approach to fixing the problems that confront us. I applaud that. The question is: Is there the political support within either of the parties to accomplish a program of this sort?
Brink Lindsey: That’s the big question. Right now, the smart money is on “no.” So in thinking through these issues and figuring out what the dimensions of state capacity were in my mind, I drew this distinction between state capacity issues and civilizational rot issues. So, first, to have good public policy you need to have a capable state, capable of devising and executing policy. But to have a capable state, you need to have a civilization — or, less grandiosely, a political culture that is capable of producing a capable state. So in my mind, the CDC’s failures on testing and the FDA’s foot-dragging on approving tests and vaccines fall into the state capacity side of things. Whereas the anti-vaccine movement falls into the civilizational rot, dysfunctional political culture side of things.
And so right now, it is very clear that our political culture is deeply dysfunctional, with the Republican Party in the grips of just clinical delusion about the results of the 2020 election. And then important quarters of the left are much more concerned about winning internal battles and demonstrating their own ideological purity on matters of social justice rather than actually assembling a large enough coalition to beat back the authoritarian challenge from Republicans. So our political situation right now is in crisis. And so as long as that crisis continues, I don’t see the civilizational or political cultural foundations for a state capacity renaissance. But I do see… So if not feeling optimistic right now, there are grounds for hope. The U.S. has muddled through political crises in the past and there’s a good shot we’ll muddle through this one.
Borrowing a line from William F. Buckley, who was asked “What are you doing?” back in the ’60s, arguing so at such variance with the then-happy postwar consensus, he said, “We’re building landing strips in the jungle. We don’t know if the troops will arrive, but if they do, we want to be ready for them.” And so that’s what we’re doing at the Niskanen Center. We’re building these landing strips for restoring state capacity. And if the political culture can come around to get planes back in the air, we’ll be ready to receive them.
Geoff Kabaservice: And we’ll have coffee and Coke!
Brink Lindsey: Yes.
Geoff Kabaservice: Well, keep the faith, Brink. And thanks very much for talking to me today.
Brink Lindsey: Absolutely. Great fun talking to you.
Geoff Kabaservice: And thank you all for listening to the Vital Center podcast. Please subscribe and rate us on your preferred podcasting platform. And if you have any questions, comments, or other responses, please include them along with your rating or send us an email at contact@niskanencenter.org. Thanks as always to our technical director Kristie Eshelman, our sound engineer Ray Ingegneri, and the Niskanen Center in Washington, D.C.
Photo credit: iStock