Another step down the road to serfdom

by Roger Koppl

Peter Orszag, former director of the Office of Management and Budget, has written an article for The New Republic entitled “Too Much of a Good Thing: Why we need less democracy.”  “To solve the serious problems facing our country,” he says, “we need to minimize the harm from legislative inertia by relying more on automatic policies and depoliticized commissions for certain policy decisions. In other words, radical as it sounds, we need to counter the gridlock of our political institutions by making them a bit less democratic.”

Orszag notes that “polarization” has been growing since about 1970.  He casts about for an explanation and rightly rejects gerrymandering as an important contributor.  If that were it, there should be less polarization in the Senate than the House, which does not seem to be the case.  His best explanation is that Americans are increasingly sorted into locations where we hear only opinions similar to our own.  With “the big sort,” more and more of us are living in ideological echo chambers.

Orszag does not consider another cause, which may itself contribute to the big sort: the increasing volume and cost of federal regulation.  The Federal Register publishes the new regulations coming out of federal government.  The number of pages in the Federal Register keeps growing, as does the administrative cost of federal regulation.  (See Figure 1 here.)

As the scope of federal regulation grows, Congress finds itself increasingly embroiled in problems of economic planning.  How shall we balance the tradeoff between cheap energy and reduced greenhouse gases?  Shall we support solar power or wind power?  Should medical care focus more on prevention or treatment?  And so on.  In The Road to Serfdom  F. A. Hayek pointed out that no solution could satisfy all members of the democratic public.  The greater the scope of centralized planning in economic affairs, the more gridlock there will be in the legislature.  “The inability of democratic assemblies to carry out what seems to be a clear mandate of the people will inevitably cause dissatisfaction with democratic institutions,” Hayek says.  For a while it may be possible to get something done by delegating the legislature’s authority to outside bodies, such as a panel of experts.  “The conviction grows,” Hayek explains, “that the direction must be ‘taken out of politics’ and placed in the hands of experts – permanent officials or independent autonomous bodies.”  This expedient is a stopgap, however.  At some point democratic planning brings on calls for a more complete abrogation of legislative power.  “The cry for an economic dictator is a characteristic stage in the movement toward planning.”

Hayek’s discussion of “Planning and Democracy” in The Road to Serfdom fits national politics in America today all too well.  We have gridlock and calls to take politics out of important decisions, including debt reduction.  We have the delegation of Congressional authority to bodies such as the debt Supercommittee.  And now with Peter Orszag we have calls for the nation to become “less democratic.”

We should see Hayek’s warning in Orszag’s call to be less democratic.  The cause of the problem is not the big sort, but the big government.  If we do not mend our ways, we shall end up at the end of the road to serfdom.