Is Government the Problem?

For more than 65 years I have ‘resided’ in public (i.e., governmental) or private (non-governmental) communities/institutions.  I attended very good public K-12 schools, a private undergraduate college, and a public graduate university; was employed for almost 30 years at public universities, for five years at a private university and a final five years at national universities abroad.  For the last seven years we have resided in a private community on whose board I now sit.  All in all a fairly broad spectrum of experiences with private and governmental entities as a consumer/student, employee, administrator and board member.

I was reminded of this when I read the latest predictable Trump tirade on “the steady creep of government bureaucracy that drains the vitality and wealth of the people.”  Try as I might, I couldn’t think of much creeping and draining in my more than half century of experiences.    While neither would receive stellar marks in my grade book, I have in fact seen remarkably little difference between the public and private sectors when it comes to vitality and efficiency.  Of course the notion that government can do no right and the private sector no wrong has long been a conservative mantra, probably expressed most memorably by the infamous Reagan inaugural address invective that “government is not the solution to our problem; government is the problem.” I called bullshit then, as I do now.

Are there examples of wasteful government bureaucracies?  Absolutely.  The U.S. Congress comes first to mind, ironically so since its bodies are supposed to be closest to the people and therefore most incentivized to act responsibly and responsively.  But then again, mention just about any private airline or cable TV company, for example, and similar ‘wtf?’ examples of inefficiency and indifference to customers come to mind.  Since this anti-government, pro-private sector narrative is currently being regurgitated by the Trump administration, let’s take a brief look for evidence at two of the central rhetorical tenets of the Trump campaign:  “Drain the swamp!” and “Repeal and replace!”

In its Trumpian manifestation, “Drain the swamp!” clearly suggests a war on deep pocket lobbying and special interest influence.  It also means, according to Trump’s Director of Management and Budget Mick Mulvaney, “making the government more accountable to you, more effective and more efficient,” presumably by replacing wasteful bureaucratic processes and personnel with the magic of private sector-inspired systems and acumen.

Since no previous President has had more business experience or less government experience than Mr. Trump, it’s especially appropriate to ask after six months – “How’s the transformation going under the preeminent capitalist?” Answer?  Not well.  First the crackdown on lobbyists.  During the campaign Trump said he would ask Congress for a five-year ban on lobbying for former members of Congress and top staff.  To date – no ask and no ban. The total number of lobbyists is actually up over the same point in time for the Obama administration.   And though Presidential appointments are occurring at an alarmingly slow pace (more on this below), a recent analysis by the New York Times concluded that those completed reflect a dangerous bias toward former lobbyists, lawyers and consultants who in many cases will be overseeing and regulating the same industries in which they recently earned a paycheck.  Trump apparently has mistaken ‘double down’ for ‘crackdown.’

Well OK, but surely there is by now ample evidence of new efficiencies under the swamp-draining Trump Administration.  If efficiency means simply hiring less, spending less, and/or regulating less (in short, doing less) then they deserve pretty high marks, but efficiency is usually defined in terms of doing better rather than just doing less.  What about the increasingly important management of sensitive national security information for example?  According to a Senate report released last week the Trump Administration is encountering an unprecedented wave of national security leaks that far surpass those experienced under either of the two previous administrations.

How about managing the Trump policy agenda?  In spite of Republican majorities in both houses of Congress, each of their three most important policy reform proposals – in health care, taxation and immigration – has been mishandled and mismanaged through the legislative process to such an extent that all three are in danger of failure without major revision. Or let’s look at the previously-mentioned fundamental task of any new administration – appointments.  There are 557 key presidential appointments that require Senate confirmation. As of early July only 176 of those have even been formally nominated by President Trump, and only 46 of those nominees have been confirmed by the Republican-controlled Senate.  By any objective measure this is a deplorable record for both the Senate and the President.  For those scoring at home, Swamp 1, Trump 0.

The grossly mismanaged “Repeal and replace!” initiative is also based on the same core belief – that a ‘market-based’ private health care system will be far superior to one that’s excessively government-tainted.  Not only does virtually all the international evidence contradict this fantasy, but so even does our domestic experience.  Quick personal anecdote.  My medical insurance is provided by Medicare, supplemented by United Healthcare.  My prostate surgery six years ago was covered fully and efficiently.  My spouse relies on the United Healthcare (UHC) family policy as she is not yet 65 (cradle robber, I know).  Her recent bout of diverticulitis required hospitalized treatment and monitoring due to her chronic clotting disorder.  Bottom line:  a $15,000+ bill from the hospital was miscoded and subsequently denied for coverage by UHC.  The denial occurred more than four months ago, since which most of her time has been spent attempting to just speak to a human being at either the (private) hospital or the (private) insurance company.

Of course two incidents do not justify a conclusion, but the broader evidence does.  A comprehensive 2002 Commonwealth Fund survey of almost 3,500 randomly selected adults found that Medicare beneficiaries were significantly more likely than enrollees in private plans to rate their insurance as excellent, less likely to report negative experiences with their plans, and more likely to report being very satisfied with the care they received.  In addition, numerous recent studies have estimated Medicare’s administrative costs in the 3-5% range, while private plans fall into a broader but much higher span of 11-30%.

So yes, Republicans since Reagan have spewed the rhetoric of reducing government and unleashing the private sector.  And yes, evidence shows that this is often simplistic or just plain wrong.  But here’s the more profound truth – they often don’t even practice what they preach.  They’ve consistently favored tax cuts for the affluent and reduced support for the poor, but NOT a reduced government stance on military or homeland security spending, corporate bailouts, debt or religion- and privacy-based policies.  This is not principled libertarianism or populism; it is deceitful subterfuge.  And the problem is not too much government; it is too much hypocrisy.

Author: garygram

I spent my career as an economics professor and administrator at universities in New York, Texas, Florida and the United Arab Emirates. Since some part-time consulting in 2013-14 in Qatar, I have been retired with my spouse in Hilton Head's naturally spectacular Moss Creek community. My current passions are public policy, music, tennis, grandkids, community service (I currently serve on the Moss Creek Board of Directors), the Nebraska Cornhuskers and now blog writing, not necessarily in that order. While I will always attempt in my blog writing to be objective and evidence-grounded, it will probably become apparent that I am what is typically today called Progressive, a status that seems quickly to be coming back into favor. View all posts by garygram