The Price of Civilization

by Jeffrey D. Sachs

  One part of setting bold but achievable goals is to benchmark America’s performance with other countries. There are many such benchmarking exercises, but they are paid little attention by Washington and the public. If the political leadership and the American public begin to pay more attention to these benchmarks, they will better understand the case for reform.

  Mobilize Expertise

  The problems facing America have become much more complex over time, and the political class lacks the capacity to deal with them. The problems are global, interconnected across many areas of politics and policy, and often highly technical. The climate change challenge, for example, involves agriculture (both as a source of greenhouse gas emissions and as a highly vulnerable sector), electricity generation and distribution, federal and private land use, transportation, urban design, nuclear power, disaster risk management, climate modeling, international financing, public health, and global negotiations. Could one imagine a problem less easily handled by a layman Congress operating on a two-year election cycle?

  The government’s departments are organized along the traditional lines that reflect the era when issues hit the American political radar screen, not the crosscutting challenges that we face today. The departments of Labor and Commerce date from 1913, during the Progressive Era. The Department of Energy dates from 1977, following the first oil crisis. It was almost dismantled by the Reagan administration on free-market principles. We have no departments for sustainable development, climate change, international economic development, or national infrastructure. The White House offices in these areas provide no substitutes for a department. Obama’s former “climate change czar” Carol Browner had a staff of fewer than a dozen professionals, almost all of whom were focused on congressional liaison rather than the technical substance of the climate change and energy agenda.

  Congress is notoriously ill equipped to deal with these technical issues. Among the 535 members of Congress, those with advanced scientific and engineering training include three physicists, one chemist, six engineers, one microbiologist, and sixteen medical doctors, accounting for just 5 percent of the members.4 Several decades back the Office of Technology Assessment (OTA) helped Congress navigate through the technology thicket. The OTA lasted from 1972 to 1995 and was then closed by a Republican-dominated Congress imbued with free-market fervor and the belief that science doesn’t matter (or, perhaps more accurately, that it is threatening to powerful interests).

  America’s scientific and technological experts in academia and industry would be honored to contribute their knowledge toward national problem solving, but they are too rarely asked. Expertise can be harnessed through special commissions and research programs led by leading scientific bodies (such as the National Academy of Sciences, the National Science Foundation, the National Institutes of Health, and the national laboratories). Both Congress and the administration need stronger and more systematic scientific advice. Congress should reestablish the Office of Technology Assessment, and the President’s Council of Advisors on Science and Technology (PCAST) should be considerably strengthened and tasked with preparing major public studies on key policy issues.

  Make Multiyear Plans

  The lack of clear goals, inherent complexity of issues, and mix of scientific confusion and disinformation would probably be enough to stop most coherent action in its tracks. Yet there are even greater obstacles at play in the executive branch. Even when it tries, the federal government suffers a chronic inability to develop and implement sophisticated plans.

  The problem, as noted earlier, starts with the two-year national election cycle, by far the most frequent of any major economy. The president also makes an extraordinary number of political appointments at the top of each department. This has the ostensible advantage of bringing in fresh ideas with a change of political mandate. However, in practice, it leads to amateurism, a revolving door between senior officials and private business, and an incredibly time-consuming process to fill the administration’s top jobs. After one year in office, according to the Partnership for Public Service, the Obama administration had filled only around 60 percent of the top five hundred jobs.5 This has meant that throughout the administration, senior teams were not even in place as the 2010 elections approached.

  All these problems of short-termism are compounded by an antiplanning mentality. More than two years into the Obama presidency, we’ve yet to see a coherent plan on almost any front. Health care reform was pushed through Congress without a plan. There is still no energy and climate plan. There is no plan to eliminate the budget deficit. Nobody in his right mind should advocate rigid central planning (in which the government tries to fix wages, prices, and outputs across the economy), but nobody should believe that complex challenges of science and technology, higher education, modernization of infrastructure, climate change mitigation, and the restoration of budget balance can be addressed without a careful, multiyear planning process within government.

  The closest we now come to multiyear planning is the Office of Management and Budget, but OMB is focused largely on year-to-year budgets. Upgrading OMB or another agency to prepare multiyear plans for public-sector action will sound absolutely heretical to most Americans, but the truth is that most successful governments have such an agency or department, and make use of it especially to address the kinds of public investment challenges that America has been neglecting during the past thirty years.

  One key—perhaps the key—to effective planning is to embrace complexity. The economy is a complex system, linking millions of public and private enterprises and billions of consumers around the world. With a complex system, there is rarely a single solution to a problem. “Magic bullets,” or single-minded solutions, are the favorite prescriptions of superficial analysts. Beware! Whether we are dealing with balancing the budget, improving education, reducing unemployment, or addressing immigration, the solutions are likely to be messy and complex, change over time, and involve multiple levels of government, from the international to the local. Plans are vital, but they must include several interlinked policies, be adaptive over time, and be open to a wide range of participants from business, government agencies, and civil-society institutions. The point is that the solutions won’t come through the easy nostrums of our day, whether tax cuts, stimulus spending, immigration crackdowns, or getting tough on teachers’ unions. The only thing in common with these kinds of “plans” is that they are based on oversimplicity in a complex economy and society.

  Be Mindful of the Far Future

  We cannot, of course, peer into the distant future, but we can still train ourselves and orient our political system to be mindful of the far future, a time horizon, for example, of at least two generations ahead. The U.S. government pioneered such thinking with the establishment of national parks in the Yellowstone National Park Act of 1872, signed by President Ulysses S. Grant; the American Antiquities Act of 1906, signed by President Theodore Roosevelt; and the National Park Service Organic Act of 1916, signed by President Woodrow Wilson. The new National Park Service was directed “to conserve the scenery and the natural and historic objects and the wild life therein and to provide for the enjoyment of the same in such manner and by such means as will leave them unimpaired for the enjoyment of future generations.”6 In a world rife with environmental degradation, such future-oriented stewardship has become a matter of survival.

  The president should devote part of every State of the Union speech to describing the implications of our actions today—in science and technology, environmental threats, demography and aging, saving and investment—for an average American in the year 2050. This alone would open the eyes of the citizenry to our stewardship for the future. After all, today’s newborns will be a mere forty years old at midcentury. We need not presume to shape the distant future; we need only respect the prospects of those newly born today.

  End the Corporatocracy

  As long as practical politics revolves around raising large su
ms for media campaigns, America’s corporatocracy will remain in place and the downward economic slide will continue. During the past decade, the curtain has been pulled away from the Wizards of Washington who manipulate campaign financing, lobbying outlays, and revolving doors, and the public now understands the flow of corporate money much better than in the past. Politicians would be foolhardy to believe otherwise. Rather than despair, I therefore ask instead what might be done. How can the broken system be fixed? For that, we need to identify practical steps that could extricate the federal government from the clutches of the lobbies.

  Provide public campaign financing. No longer should we let Obama or any other supposedly reform-minded presidential candidate walk away from public campaign finance, as Obama did in 2008. The Democrats and Republicans are equally tarnished by private campaign finance, and neither party should be trusted. Federal campaign financing should be extended to congressional elections.

  Provide free media time. Broadcast TV should be required to set aside a fixed amount of time for free media according to explicit allocation rules.

  Ban campaign contributions from lobbying firms. Lobbying firms are a cancer on the political process. Employees of registered lobbying firms should be banned from making campaign contributions to candidates or political parties.

  Stop the revolving door. Senior federal employees should be barred from employment in registered lobbying firms for a minimum of at least three years from their departure from federal service. They should also be prohibited from accepting employment in any company that lobbied their agency during their tenure in public office.

  Take away the trough. Corporations currently view campaign financing as a corporate investment, to obtain tax cuts for the wealthy, deregulation, no-bid government contracts, earmarks, and other perquisites of power. By directly opposing such abuses of the federal budget, corporations will have less reason to try to buy politicians through campaign financing.

  When Obama became president, many of us hoped he would chase the moneylenders out of the Capitol. The financial crisis had exposed the tawdry side of Wall Street and politics and the intertwined tentacles connecting the two. Yet before the first stock market bell of his presidency had rung, Obama had installed a pro-banking team at the White House, led by Larry Summers. For the first two years of his administration, he sided mostly with the bankers, providing bailouts but asking for and getting too little in return regarding restraints on salaries, bonuses, and other abusive behaviors of the past. The bankers, not surprisingly, continued to feign surprise and hurt when anybody suggested their complicity in the crisis or the need to restrain their gargantuan pay. Whether Obama will ever take on Wall Street and the other corporate interest groups remains an open question, though hopes have grown somewhat dim.

  Defeating the corporatocracy is, of course, easier said than done. American politics is a deeply entrenched, mutually supportive duopoly of parties, while the public is distracted and swayed by propaganda. Even if we know the means needed to break the power/money nexus, getting them adopted will require active political struggle. My guess is that it will be the rise of a credible third party, focused heavily on removing money from politics, that will sooner or later break the duopoly. It’s not as if the problem is so complex that it is hidden from view. It is widely known, but the public does not know where to turn. Any political movement that offers a way forward will tap a very deep vein of disappointment, anger, and political mobilization. A new political party can be combined with other forms of political agitation—consumer boycotts, protests, media campaigns, and social networking efforts—to put the most egregious leaders of the corporatocracy on notice. As I discuss in the next chapter, my belief is that the young generation of Millennials, today’s young people aged eighteen to twenty-nine, will have both the motive and the means to take on this challenge.

  Restore Public Management

  The constant “reinvention” of government has amounted mostly to poorly supervised handouts for private contractors, such as Halliburton and Blackwater in the war zones and the “Beltway bandits” who swarm around the U.S. development aid programs. The extent of contracting vastly exceeds agencies’ ability to oversee the contractors’ work. The contracting process, frequently no-compete arrangements, encourages corruption on an unprecedented scale. Tens of billions of dollars have gone astray in recent years while the “war lobby” encourages Congress to prolong the senseless occupations of Iraq and Afghanistan. The proper approach is to rebuild public management, not to turn it over to voracious private firms.

  A starting point for proper public management would be a significant increase in trained professional managers within the departments, recruited on the basis of salaries competitive with those in the private sector. Political appointments would be reduced in number and converted to senior civil service appointments. Renewed efforts would be made to monitor, evaluate, and audit all outsourced programs. The enormous, corrupt, and wasteful no-compete contracts of the Pentagon would be brought to an end.

  Decentralize

  America is an enormous and diverse country that can be managed only with considerable local variation in its policies. For a long time, the political Left has routinely looked to Washington to impose its will on the entire country, on social issues such as sexual mores, income redistribution, education policy, health care, and other issues. These efforts have mostly backfired. Rather than finding compromises on these contentious issues that allow for local variations in policies, pressures for Washington-imposed uniformity have often led to an anti-Washington backlash with no results at all. It is time for those in favor of a more activist government to accept the doctrine of subsidiarity. This doctrine, as I noted earlier, holds that policy problems should be addressed at the most local level of government that is capable of providing a solution. Education, health, roads, water treatment, and the like can generally be addressed locally. Most tax collection, on the other hand, should be national, to reduce the serious problem of tax competition between states and localities.

  There is another compelling reason for decentralization of social services. The most powerful tool for breaking extreme poverty is a holistic community-based development strategy that combines vocational training and job placement, early childhood development, educational upgrading, and local infrastructure. Each part of the antipoverty effort supports all of the others. This kind of ground-up development effort must in practice be led by the communities themselves but backed with financing from the federal and state governments.

  Options for Fundamental Change

  My recommendations in this chapter can be called ameliorative: they aim to use moderate means to turn around a moderately broken situation. We have to ask, however, whether this will be enough. The despair and cynicism in America are deep. There is a widespread feeling that nothing will change. Perhaps only a more dramatic break with today’s political institutions can work.

  One obvious starting point would be a third party, to break the corrupted duopoly of the Democrats and Republicans. The obstacles to such an effort are real but not quite as insurmountable as is often believed. In recent years we have had several important third-party candidates for president, including John Anderson in 1980, Ross Perot in 1992 and 1996, and Ralph Nader in 2000 and 2004. Each achieved ballot access across most of the United States, and each generated a significant following and made a significant contribution to the political debate.

  My view is that a broad-based national party that stood for effective governance, the end of the corporatocracy, and investments in America’s future could command the vital center of politics, a kind of radical centrism.7 Perhaps an ARC—Alliance for the Radical Center—Party could test the waters in 2012. The party would be centrist because America’s centrist values, which balance individualism and social responsibility, offer a basis for a new prosperity. It would be radical in that it would signal a decisive break with the recent past. The costs of launching a third party would be sma
ll, and the potential benefits could be enormous if it accomplished nothing more than awakening public awareness and putting pressure on the two corrupted major parties to clean up their acts.

  A more fundamental set of constitutional reforms would usefully shift America’s majoritarian constitutional system toward more parliamentarism, perhaps aiming toward a French-style mixed presidential-parliamentary system. Constitutional change is inherently slow and hazardous, the ultimate Pandora’s box of politics. We can’t yet know whether fundamental constitutional change will be needed to rescue American democracy. But if it is, we should aim for the benefits of parliamentary systems: a coherent government that combines the executive and legislative branches under a prime minister; a longer-term perspective of four to six years rather than our current two-year cycle; and more proportional representation, to give more weight and voting power to the poor and minorities so that their concerns, too, will be addressed—and redressed.

  Saving Government Before It’s Too Late

  The bad old joke complains about the lousy restaurant where the food is terrible—and the portions are too small. Arguing for a larger role of government feels about the same. Yes, the federal government is incompetent and corrupt—but we need more, not less, of it. On the one hand, we need a more active role of government to address fundamental collective challenges such as infrastructure, clean energy, public education, health care, and poverty. On the other hand, the government is so dysfunctional that our tendency is to want to cut rather than expand its role. This chapter, I hope, has suggested some ways to overcome this impasse. We need more government, but also a much more competent and honest government. Economic reform and political reform must go hand in hand. Without the one there cannot be the other.