I recently participated in a debate/discussion with regulation scholar Wayne Crews, my colleague at the Competitive Enterprise Institute and author of the invaluable annual regulatory survey Ten Thousand Commandments. The subject was DOGE, about which we just barely disagree: His position is that DOGE is better than nothing, and mine is that DOGE is worse than nothing. Where we agree is that in concerns touching both spending and regulation, Congress is the solution—because Congress is the problem.
Or, more precisely, Congress is the problem most closely at hand.
Politicians who face the voters periodically have a schedule of incentives that is different from what businesses experience in the marketplace—it didn’t take two years for consumers to offer a verdict on New Coke or the Ford Edsel—and the nature of the incentives is different, too, but they do ultimately respond to the voters who either reward or punish them. That’s another way of saying that peoples who have recourse to democratic processes get approximately the government they deserve. Our Congress problem ultimately proceeds not from the character of House Speaker Mike Johnson or Senate Minority Leader Chuck Schumer but from the character of the American people, of whom Elon Musk is about as good a representative as a harem-keeping ketamine-addled billionaire from South Africa could hope to be.
Musk and the Muskovites talk about the world of politics and policy in terms of good and evil, and most of the idiotic catchphrases of the contemporary right—elites, Deep State, woke, etc.—are just dumb and/or dishonest ways of saying evil. Progressives rely on roughly the same figures of speech when they talk about corporations or the Federalist Society or, when the subject comes up, me. This thinking, if we are to flatter it with that illustrious gerund, extends from individuals to institutions, with millions of Americans apparently believing in all sincerity that Harvard and Google and this or that bloc on the Supreme Court and whichever political party isn’t theirs have the priorities and values they have because the people involved are evil.
That kind of thing is the reason Musk failed at DOGE and the reason DOGE itself has failed and will fail to amount to anything other than a gormless blue-ribbon commission run by dilettantes and ignoramuses. Musk et al.—and Trump himself above all—believe that they can set things right in our wobbly republic if only they could simply punish the wicked and reward the virtuous, and, because their ignorance is compounded by arrogance, it never occurs to them that this is another way to say, “We require the power to disadvantage people who compete with us for status or resources in order to hand out favors for our friends.” Trump is a kind of naïve Nietzschean, unable to distinguish what is good from what he wants.
And so DOGE looks like vandalism because DOGE is vandalism. This is not like the fall of Rome, if only because we are our own Visigoths.
We have the better part of a century’s worth of excellent scholarship about the problems of bureaucracy, collective action, and political incentives. Even the least intellectually inclined of our policymakers are equipped to make use of such elementary insights as the problem of concentrated benefits versus distributed costs, which explains why we have very powerful and energetic lobbies for things such as corporate welfare but only relatively weak and under-resourced resistance to these programs: The people who collect $500,000 a year in farm subsidies care a lot more about farm subsidies than do the people who pay an extra $0.003 in federal income tax to fund that handout. Government programs provide benefits to people you like and to people you hate, and it is not evil when the people you hate take political action to maximize their benefits. It is no more of a sin for a Fortune 500 company to try to lower its taxes than it is a sin for you to try to lower your taxes.
One needs to be clear-eyed about how that plays out in the real world. If you want to write up some new rules regulating the activities of private equity firms, and you want those regulations to be good regulations, what do you do? You begin by consulting the people who know a great deal about private equity investing and the firms that do it, who understand what purpose these firms serve in the broader economy, etc. Do you know where you find those people? In private equity firms or among the veterans of those firms. As regulations go through the process of comment, review, and revision, some people and institutions will be very interested in that process—and who do you think that will be?
Industry doesn’t always get its way in these matters, of course, and they are not the only ones who have money and relationships to bring to bear on the process: The Environmental Protection Agency, for example, responds to pressure from different quarters funded by other sources, but this pressure is no less self-interested and no more likely to be neutral and evenhanded than industry influence is. And it is not the case that we can count on these rival sources of pressure to cancel one another out, enabling the regulator to land on the optimal policy. Two sources of distortion rarely if ever lead to clarity, and when they do, it is only a happy accident.
We do not have a gigantic debt and deficit because the people who make the decisions are evil. We have a fiscal problem because the people who receive Social Security and Medicare benefits care a great deal about them, and the people who want to reform these entitlements do not represent large and highly incentivized constituencies—and will not represent such constituencies until the fiscal crisis that awaits us, as a matter of mathematical near-certainty, is finally upon us. But Musk et al. look at this as a matter of good and evil, partly because they are silly and ignorant enough to believe that to be the case and partly because they know that nobody at the moment wants to listen to the boring—horrifying, but boring—facts of the case. And so they pretend that the problem is some clerk in the bowels of the bank-regulation apparatus who produces an annual report on minority-owned banks or the occasional penny on the dollar of aid to Ukrainians who are so maddeningly committed to the cause of their own national survival. The problem cannot be grandma’s Medicare benefits: They must be eating the cats in Springfield.
The people who know what they are talking about talk about incentives. The people who don’t know what they’re talking about—or who wish to deceive you and to treat you like a fool—talk about good and evil.
On either side of the aisle, the smarter kind of politician understands that our problems are not simple. But many of them believe that you are.
