The Stakes of the Democratic Agenda

by publius

Early last week, President Obama – somewhat out of the blue – said quite bluntly that he supported net neutrality.  Policy-wise, that’s great.  But it’s also sort of amazing that net neutrality has come this far.

Think about it – net neutrality has no well-funded lobby.  There are literally legions of savvy industry lobbyists fighting against it.  And it’s not clear whether the issue has any obvious political benefits with the public-at-large.  From a public choice perspective, net neutrality should be dead.  But there was Obama last week, saying very good things.

And there’s a larger story here.  What’s interesting about the fight for net neutrality – or “openness” – is that it will illustrate whether things like organizing and grassroots pressure actually work.  I think they do – and I think that the progress on Internet openness is a testament to those efforts.  But the jury’s still out on that. 

But more broadly, we’re seeing many of these same questions in the fight over the larger Democratic agenda.  Indeed, what’s most interesting – and exciting – about the fight for things like health care reform and cap and trade is that they potentially challenge the more depressing predictions of public choice theory.  In other words, these major reforms would (if enacted) challenge the notion that democracies are primarily controlled by narrow interest groups.

Before I go on, I know that public choice theory covers an enormous range of ideas and camps, etc.  So for purposes of this post, I’m referring to the idea that intensely-committed minorities run the show in majoritarian democracies.  Conor Friedersdorf captured the idea quite well a few days ago (though his post is making a somewhat different point overall):

I wish that progressives would realize that parties with a narrow vested interest in a legislative outcome are always going to enjoy an advantage over the diffuse interests of the populace, and especially that portion of the populace that is without power.  Community organizing is never going to change this basic fact, nor is any campaign finance reform that passes constitutional muster, nor is a bigger Democratic majority in Congress.

That’s basically the idea of public choice I’m using here.  And he could be right.  I hope he’s not, but it’s a powerful critique that progressives shouldn’t ignore.  What’s promising, though, is that the ambition and content of the Democratic agenda gives some hope to the non-skeptics (for now, anyway).

Under the public choice perspective, none of the big-ticket Democratic items (e.g., health care, energy) should get enacted.  Or if they did get enacted, the prediction would be that the new laws would basically serve narrow interest groups. 

Take health care for instance.  The benefits of reform are spread out pretty diffusely across the country.  But the big potential losers are powerful, well-connected lobbies like insurance companies and hospitals.  And it’s not a coincidence that these groups won the last round in 1994 rather decisively.

Same deal with energy reform.  The benefits of a non-overheating planet are spread widely, and aren’t immediately obvious to the public.  Energy reform, however, could really harm coal and oil companies, both of whom know their way around Washington.  From this perspective, it’s really really easy to see how the Markey bill could fail, and much harder to see how it could succeed.  (By "succeed," I mean not only get passed, but get passed in an acceptable form).

But all that said, these reforms are moving ahead and seem to be gaining momentum.  But it’s not only that the bills themselves have momentum.  There's a lot of content in the bills that would challenge the notion that narrow interests will ultimately win.

The best example is the public option.  It’s not only good policy, its enactment would vindicate the idea of government.   That is, it would restore some faith in the idea that our institutions can serve the broader populace’s interests in the face of these structural obstacles. 

And the obstacles to the public option are significant.  It’s going to be viciously opposed by well-organized industry lobbying groups.  At the same time, the main beneficiaries aren’t as organized, and lack political and lobbying power (yet another reason why a strong labor movement is so critical). 

So even though public choice theory would predict that the public option is unlikely to ever see the light of day, it’s still very much on the table.  And the President has come out in strong support.

It’s true, of course, that maybe the Great Public Option Hope will fall prey to the interest groups even if it gets enacted.  But I still think it's a good ex ante check on future meddling by interest groups.  It will be harder to gut the public option than to gut regulations that would apply directly to private insurers.

But anyway, the larger point here is that the next year or so may show whether our institutions are actually capable of providing our most urgent and necessary reforms -- or whether they're simply dysfunctional. 

For now, I’m hopeful.  But I’ve also seen The Wire.

Comments

[yoyo]

Not really my area, but aren't some internet content providers like google in favor of net neutrality?

[Brett Bellmore]

"In other words, these major reforms would (if enacted) challenge the notion that democracies are primarily controlled by narrow interest groups."

Not really. Congress is one of the narrowest interest groups around, and most of the 'reforms' you're talking about represent net transfers of power to Congress, and hence are right in line with the interest it's obsessed about.

"At the same time, the main beneficiaries aren’t as organized, and lack political and lobbying power "

Again, not really, the main beneficiary will be Congress, which is very well organized, and which will benefit immensely from the power transfer enhancing it's revenue via increased bribes and extortion.

[chmood]

Brett - do you only make unsupported assertions? Do you ever offer supporting arguments or reference facts?

[Brett Bellmore]

Look, if we're talking public choice theory, the central observation of that theory is that regulators and politicians are, themselves, interest groups, out for their own benefit. And as the ones actually making the public policy, it IS going to work for that benefit. You might think, when you get them to enact a policy you want, that your interest has triumphed, but if you look closely, you'll see that they've gotten something out of it.

The main challenge in designing governmental institutions is to make the interests of the people running them align with everybody else, because that's the only way they'll benefit everybody else, too.

This is why, year after year, almost monotonically, the power of government keeps growing. Because it's in the interest of the people running it that they have more power.

[kent]

Brett's take reduces "Public Choice Theory" to a tautology. If Congress counts as someone whose "interest" may "triumph" in a legislative battle, then by definition Congress will always win ... because it's Congress that passes the law. I, for one, do not see the point of using the term that way.

[Nate]

Well, for once I sort of agree with Brett. One of the main challenges with designing ANY system is to make sure the interests of the people running them align with the interests of everybody else, too.

The whole "free market" thing is supposed to do that, but in many cases, it doesn't.

Of course, when radicals talk about changing "the system" which is the established incentives that make the people in positions of power not share the interests of everybody else, they're dismissed as DFHs, or shrill, or "unrealistic" as if our current set of institutions and systems were handed down carved in stone that's immune to chisels. I think that metaphor sort of broke.

[Consumatopia]

The version of public choice theory Brett proposes is definitely, obviously wrong in both theory and recent history--legislatures do not automatically seek to expand their power. Legislatures seek to avoid responsibility. Those are opposing ends. Thus Congress has shown no interest in oversight of the executive branch. Thus legislators of the opposing party go along with the president to war. Thus Congress delegates decision making authority to various executive branch bureaucrats and creates new a-political decision making bodies like the Fed. Thus Congress has, for the past few decades, pursued deregulation, and resisted the very reforms that Brett accuses them of seeking. (So even if he was right about Congress seeking power now, he fails to explain why Congress didn't do so earlier.)

The individual interests of the legislatures has nothing to do with with the scope of power of Congress as a whole. In fact, if power remains in the hands of corporations and the ultra-wealthy, those people would keep paying individual legislators to make sure it stays that way.

Public choice theory successfully explains everything bad in our government, but nothing that's good. And this is America, this is a democratic government, and there's a lot of stuff that's good in it. PCT is not wrong, but it's very incomplete. In general, any theories explaining human behavior that assume nearly flawless individual rationality are suspect.

[Herostratus]

I would go with The Wire on this one. Institutions are not going to reform themselves. All this reform talk will slow down soon and we'll hear people say, "wait till after the midterm elections, then we'll take on the interest groups." Then it'll be Obama's reelection campaign, etc.

[Nell]

He said he supported transparency in government, too, so you might want to hold off on chilling the champagne.

[omar]

I wouldn't say politicians are interest groups but rather they have a job with directly competing interests. Ostensibly their job is to serve their constituency. However, a politician also wants to keep his/her job and wield ever-greater influence. To do this they must get money, have friends with power and move up the ladder in their political party. This motivation is often in direct opposition to the interests of their constituency, or at least to the public at large.

A savvy (unethical?) politician would then simply appear to be working for the best interests of his constituency (e.g. by making a show of a large public works project, providing pork to their district or some such shit) while spooning with interest groups to get the money and influence needed to get re-elected and cow-towing to their party leadership to gain greater influence within the party. The interest public at large is not the primary focus unless the politician is a motivated idealist. Even then, the influence of the special interest groups working against them might nullify their actions. Only when policy reform starts from the top, i.e. the president, is there a possibility of truly taking into account what is in the public's greatest interest. And that certainly doesn't always work either (see Clinton healthcare reform). And presidents are trying to re-elected just like the rest of them.

In short, trying to get a politician to consider what is best for the public when making policy, what one might think is their job, is damn near impossible the way things currently are set up.

[Gary Farber]

"I would go with The Wire on this one. Institutions are not going to reform themselves."

Also, we should have more blog exchanges that go like this.

[russell]

"The main challenge in designing governmental institutions is to make the interests of the people running them align with everybody else, because that's the only way they'll benefit everybody else, too."

Throw their @sses out. That will get their attention.

Too hard to do? US voter turnout in an off-year congressional election is between 35-40%. In a lot of places, if you're determined to make a difference you probably can.

Too corrupt? Get the money out of it. Everybody hates to hear that, of course, because after all in this country "money is speech".

The Open Secrets lobbying database says that in 2008 $3.27 billion-with-a-b was spent on lobbying, and there were 15,223 registered lobbyists. That's about $6 million and 30 lobbyists per member of Congress.

Want to reduce the corruption, get the money out.

"you might as well drop this "publius" nonsense."

publius can call himself whatever the hell he wants.

[Eric Martin]

"the equivalent to Madison, Jay, and Hamilton all rolled into one"

Um, publius IS half Madison, half Jay and half Hamilton, in addition to being half-amazing.

He transcends your silly temporal concepts of mathematics and fractions. He IS multitudes. And yet, despite his grandeur, reach and potency, he remains approximately 1/2 inch shorter than I.

[d'd'd'dave]

"Indeed, what’s most interesting – and exciting – about the fight for things like health care reform and cap and trade is that they potentially challenge the more depressing predictions of public choice theory. In other words, these major reforms would (if enacted) challenge the notion that democracies are primarily controlled by narrow interest groups."

IMHO you have failed to establish that net neutrality and cap and trade are not the supported by narrow interest groups. Do you really think that a broad swath of the public is clamoring to pay significantly more for energy as a result of cap and trade?

I'll grant you that health care reform is supported by a broad group.

[d'd'd'dave]

farber 11:39a
LOL

[d'd'd'dave]

eric 12:17p
funny

[Brett Bellmore]

"I'll grant you that health care reform is supported by a broad group."

Until you get into the details, anyway.

[Nell]

Dear Kitty Central: Get the m.f. snakes off this m.f. plane, please.

[Gary Farber]

d'd'd'dave: "Do you really think that a broad swath of the public is clamoring to pay significantly more for energy as a result of cap and trade?"

Publius's post you're responding to: "The benefits of a non-overheating planet are spread widely, and aren’t immediately obvious to the public."

So I'm thinking the answer to your question is "no."

[S.G.E.W.]

The trolls are just getting weirder and weirder 'round here.

[russell]

"The trolls are just getting weirder and weirder 'round here."

When the going gets weird, the weird turn pro.

Just ignore them, they'll go away soon enough.

Although, if opportunities for outright mockery arise, who could say no?