Earlier today, Connecticut Senator Chris Murphy tweeted:

Maybe he should look a little harder at the figures.

First:
“Boston to DC
– Airline time: 1.6 hours”

The reason high-speed rail never caught on in the United States is because we had jet airliners before Japan even started building its first bullet train. Why should we worry that a train from Beijing to Shanghai is faster than a train from Washington to Boston when our planes are twice as fast as the fastest trains in the world?

Second: China recently halted construction on two new high-speed rail lines due to mounting debt. As of a year ago, China State Railway had an $850 billion debt, and China transport experts say 80 percent of that debt is due to construction of high-speed rail lines. Construction is also partly paid for by local provinces, which have also gone heavily into debt for high-speed rail. As a result, the country is slowing its expansion of high-speed rail.

Most of China’s high-speed rail lines lose money. China hopes to recoup some of these losses by selling its high-speed rail technology to other countries, which puts those countries so heavily in debt that the program is known as “debt-trap diplomacy.” We need to be careful not to be lured into that trap ourselves.

Third: One thing that China isn’t slowing is its construction of new expressways. At the end of 2020, China had about 23,000 miles of high-speed rail lines but 100,000 miles of expressways, a 7,000-mile increase from 2019. That’s 50 percent more expressway miles than are found in the United States and close to ten times as many new expressway miles built here in 2020. China’s expressways are paid for out of tolls and unlike the rail lines there are no worries that they will contribute to a debt crisis.

China is gaining on us because it is learning what we knew 65 years ago (when Congress created the Interstate Highway Program) but have since forgotten: transportation that pays for itself out of user fees will do more for our economy than transportation that depends on heavy subsidies and government debt.

Many Americans have an idealized conception of how Congress legislates, one famously described by Schoolhouse Rock commercials. Under this renowned framework, a bill starts in a congressional subcommittee, where it is debated in hearings and edited in a process known as a “mark up.” If a subcommittee majority ultimately approves it, then the bill goes through another round of debate and edits, this time before the full committee. And if the bill passes out of the full committee, there is yet another round of debate and edits, this time on the floor of the House or Senate. Finally, if the bill survives all that, it’s sent to the other chamber of Congress, where the process starts anew. Thus, many of us have learned “how a bill becomes a law.”

Yet contemporary lawmaking looks far different. Consider the five COVID relief packages passed by Congress, totaling almost $6 trillion in spending. Never before has so much been spent by so few behind closed doors.

The first four COVID bills occurred during the 116^th (last) Congress, when Democrats controlled the House, and Republicans controlled the Senate. These massive spending measures were negotiated by party leaders, and then dumped on the rank and file, who were expected to pass the bills sight unseen, under a parliamentary procedure known as “unanimous consent.”

The most recent COVID stimulus, the $1.9 trillion American Rescue Plan, came out of the (current) 117^th Congress, in which Democrats hold majorities in both chambers. Unlike the prior pandemic relief bills, this last measure engendered partisan disagreement, so “unanimous consent” was unavailable. Instead, congressional Democrats turned to a procedural device known as “reconciliation,” which allows them to avoid a Senate filibuster. While unanimous consent and reconciliation entail obvious differences—the former requires unanimity, while the latter requires only a majority—these two parliamentary mechanisms share one crucial similarity: they are both controlled by party leaders, who negotiate legislation that is then dropped on lawmakers’ laps for a take-it-or-leave-it vote.

Clearly, we have fallen a long way from Schoolhouse Rock-style deliberation. Alas, there is further to fall. 

A month ago, in what journalists called a “magic parliamentary trick,” Senate Majority Leader Schumer announced that he had persuaded the parliamentarian to accept a new interpretation of the Senate’s rules allowing for greater use of reconciliation–the same procedure that congressional Democrats used to pass the most recent COVID stimulus. Sen. Schumer said the change would permit congressional Democrats to pursue President Biden’s “big and bold” agenda. The problem is that that there is a lot of uncertainty surrounding the reconciliation process. This is so for the simple reason that reconciliation wasn’t designed to enact party agendas. Rather, it is meant to be part of the budget process. Only in recent years have congressional leaders embraced this mechanism as a means for moving substantive legislative packages. The upshot is that lawmakers are unfamiliar with how reconciliation would operate in its expanded role. Accordingly, multiple lawmakers have expressed confusion regarding how Schumer’s “magical parliamentary trick” actually works in practice.

That’s how far American government has strayed from Schoolhouse Rock-style legislating—in the contemporary Congress, lawmakers aren’t even sure “how a bill becomes a law”!

What happened to our legislature? As I explained in a recent policy analysis, Congress has undergone a fundamental shift in its internal organization since the 1970s. Forty-five years ago, when Schoolhouse Rock first appeared on the airwaves, Congress was at the highwater mark of a period known as “committee government,” when congressional committees were the primary powerbrokers in Congress. This explains why the famed commercials focused on committee deliberation. Back then, such deliberation was the sine qua non of lawmaking.

Over the last five decades, however, Congress has moved away from “committee government.” Today, power in Congress is centralized—to an unprecedented degree—within party caucuses and, by extension, party leaders (that is, the House Speaker and the Senate Majority Leader). The reasons for this shift are complex, and I discuss them at length in the aforementioned policy analysis. The important point is that Congress has gone from being committee-centric to being party-centric.

Above, I’ve already discussed how this shift has affected lawmaking. During “committee government,” virtually all significant legislation was debated and edited by committees and subcommittees, as memorialized in the Schoolhouse Rock ads. At present, however, almost 40% of all House bills and 80% of all Senate bills are deliberated outside the committee system, according to one recent scholarly survey. In today’s Congress, important bills are negotiated by party leaders in secret.

Beyond diminished deliberation, the biggest drawback to the centralization of authority is that it undermines the separation of powers. The Founding Fathers designed a government with three branches—executive, legislative, and judicial—and gave each the means to check the other. By dispersing power into competing institutions, the Founders’ constitutional design serves to protect our individual liberty. The problem is that a party-centric Congress loses the will to compete with the presidency. When, as now, party affiliation trumps institutional pride among members of Congress, half the legislature loses interest in executive overreach whenever “their guy” occupies the oval office. In this manner, the centralization of power in Congress has abetted a constitutionally dangerous concentration of power in the presidency. 

Still, history gives me hope that Congress will revive itself and, ultimately, rebalance the separated powers. At some point, rank-and-file lawmakers will tire of having “to pass bills so that they can find out what’s in them,” to paraphrase Speaker Pelosi’s infelicitous admission. Put differently, it is the rank-and-file who are disenfranchised by the status quo, and they will always comprise a majority, such that they can empower themselves whenever they so choose. In 1910, for example, a bipartisan group of lawmakers stripped the Speaker’s office of the prerogatives he had used to rule the House of Representatives with an iron fist. This “revolt,” in turn, paved the way for the onset of “committee government,” a time when Congress fulfilled its constitutional role at the apex of American government. It can happen again. 

Electoral reform is an ever more polarized topic these days, but the reform known as ranked-choice voting, which has been making inroads lately, deserves the attention it’s been getting across party lines. New York City voters will use RCV in the upcoming mayoral election — candidate Andrew Yang, for one, has sung its praises — while the Virginia GOP will use the method this weekend in picking candidates for statewide office. Utah Republicans, who’ve done the same in the past, have a good explainer here on how it works. Together with many large cities, the states of Maine and more recently Alaska have adopted the reform — it was in use in this past November’s Maine Senate race, in which incumbent Sen. Susan Collins (R) breezed to re-election by an unexpectedly wide margin.

For those just tuning in, RCV allows you the voter to mark not only your first choice among candidates, as now, but a second, third choice and so on. Once votes are cast candidates are eliminated beginning with the least popular and their supporters redistributed per their ranked choices to remaining candidates. This continues until one candidate exceeds 50 percent of the active ballots. While novel in America, the practice is familiar and of long standing in countries like Australia and Ireland.

Economists have long tended to appreciate ranked-choice voting because it offers a way to capture and integrate into decision-making much richer information about voter preferences. Importantly, it reduces the chance that a candidate with a committed base but who lacks appeal to most voters will slip through in a crowded field. And it reduces if not eliminates the role of “spoiler” candidates, often encountered in today’s first-past-the-post system.

It also should hold a lot of attraction, I believe, for those of us with libertarian views. It allows casting a conscience vote for the long-shot candidate who is genuinely best without throwing away the chance to influence the ultimate decision. Moreover, libertarians tend to be aware that the so-called political spectrum does a poor job of capturing important facts about candidates; the ones we recognize as best (or worst) on matters of liberty and the rule of law do not necessarily line up neatly along a party spectrum. For libertarians, as for other groups, RCV respects and incorporates the complexity of actual voter preferences. 

Local election administrators and campaigners can also find practical advantages in the reform. Often called “instant runoff voting,” RCV offers a streamlined, speedier alternative to the cumbersome and expensive scheduling of a runoff election weeks later, as was seen lately in the twin Georgia Senate races.

For all these reasons I’ve recently joined the advisory board of Rank the Vote, a nonpartisan group that aims to stir interest and discussion in this method of voting. I expect to post more in the future on some of the other effects RCV may have, such as changing the manner in which candidates campaign, and altering the role third parties may play in the electoral system.

Over the last year, much of the focus of civil liberties advocates has been on the potential scope of law enforcement–federal, state, and local–monitoring of activists protesting the murder of George Floyd and other people of color by police officers. In late May 2020, then-Attorney General William Barr authorized the Drug Enforcement Administration (DEA) to conduct surveillance of protestors (Cato has a FOIA pending with DoJ to determine whether that authority remains in effect). The Department of Homeland Security conducted aerial surveillance over at least 15 U.S. cities for the same purpose. But in late June 2020, the New York Times reported that Air National Guard RC-26 reconnaissance aircraft had been employed in multiple protest locations. The revelation triggered a subsequent Air Force Inspector General investigation, which was released in August 2020. 

While the Air Force IG claimed that the aircraft lacked sensors precise enough to identify individual protestors, the incident was a reminder about how DoD elements have been used in the past to spy on Americans engaged in protests. Almost a year before George Floyd’s murder, Cato initiated a FOIA campaign targeting the Defense Department and the Services seeking to learn whether a specific DoD authority, DoD Directive 5200.27, may still be in use to target political activists. As DoD and key Service components refused to provide the requested records, today Cato filed a FOIA lawsuit in the D.C. Circuit to compel production.

We chose this particular directive because of the history of its misuse.

During the Vietnam era and carried out under DoD Directive 5200.27, the Navy’s Operation SHORT CIRCUIT was designed to disrupt the ability of organizations like the National Lawyers Guild to provide legal services to American military personnel or draftees seeking to avoid being sent to Vietnam. Whether any additional records on Operation SHORT CIRCUIT survive is the subject of Cato FOIA requests to the Navy and National Archives.

More recently, during the Bush 43 administration, DoD Directive 5200.27 was the basis for the Pentagon’s TALON program, a key component of the Counterintelligence Field Activity (CIFA) that was used to monitor anti-Iraq war protests. Although CIFA and TALON were allegedly discontinued in 2007, DoD Directive 5200.27 remains on the books–meaning that the underlying authority to resume similar programs remains. Other DoD directives and authorities relevant to concerns about military involvement in domestic surveillance will be the subject of follow up Cato FOIA requests.

In a recent opinion piece, Senator Josh Hawley claims that America’s economy is witnessing a widespread take-over from monopolies – big tech, big pharma, big finance, and more. These companies, the story goes, then harness their market power to foist ideological progressive agendas on an unwilling public.

This narrative is misleading at best. First, big is not synonymous with bad. Concentration can arise out of competitive markets for legitimate reasons. Innovative companies can – and should – expand their market share by delivering better products at lower costs. Indeed, a 2017 paper found that recent rising industry concentration trends are associated with more innovation and productivity growth.

Second, monopolies exercise economic power by restricting quantities to push up prices. In many cases, this is the opposite of what we see. Google and Facebook offer a limitless supply of services at no cost to consumers. Even if Google used its alleged monopoly power to obtain rents not from consumers, but from advertisers, this would mean advertisers pay more, while consumers see fewer ads.

Third, evidence for rising concentration is not clear-cut. A recent paper points out that, even though concentration has been rising in national product-markets, it is mostly going down at the local level. The findings suggest that as large firms expanded, they entered previously concentrated local markets, increasing competition; think about Amazon reaching small towns once served by one or two mom-and-pop stores.

Some of the figures cited are also highly misleading. The senator claims that Facebook and Google account for 60 percent of the digital advertisement market. But he forgets to mention that digital advertisement represents only half of advertising expenditures in the United States. Narrowly defined markets will yield high concentration figures, though these often do not represent relevant competition margins. The digital ad market share of both companies has also seen a slight downward trend in recent years.

If the diagnosis is wrong, the proposed treatment is unlikely to make the patient any better. Senator Hawley proposes to break up big tech companies, downsize corporations, and loosen standards to characterize anticompetitive behavior.

Breaking up big tech is likely to harm consumers and innovation. Big tech companies are U.S. leaders in R&D expenditures, and their scale likely enables their free-of-charge business model. As we have seen, downsizing at whatever cost is also a misplaced idea, since big is not a good proxy for bad. Finally, loosening court standards to characterize anticompetitive behavior is a recipe for political interference. In the days before the consumer welfare standard, Nobel laureate in economics Ronald Coase quipped that if firms raise prices, this was evidence of monopoly. If they lowered them, it was predatory pricing. And if prices remained the same, then it was tacit collusion.

The focus on industries perceived to have an anti-conservative bias makes one wonder whether political considerations have taken over economic ones. The Republican senator aims the antitrust arsenal at the tech sector, but concentration trends across high level sectors show that manufacturing is the most concentrated, while retail has seen the largest increase.

In any case, if the senator is concerned with excessive market power and competition, better approaches abound. Slashing tariffs and enhancing foreign competition would be one way to go. Reducing occupational licensing requirements would also make it easier for new entrants to displace incumbents. Finally, deregulation measures could bolster competition in several markets.

A bill that would repeal laws against sex-work, overturn convictions, and expunge records is currently making its way through the Massachusetts State Legislature: in addition to striking laws prohibiting sex-work by consenting adults, H.1867 would expunge criminal records related to marijuana offenses:

Any person having a record of criminal court appearances and dispositions in the commonwealth…for a marijuana offense…or prostitution-related offenses…shall have all such records expunged forthwith from all criminal record information systems collected or distributed by any state agency, court or municipality.

A remarkably similar bill is currently under consideration in Oregon. HB 3088 decriminalizes both the sale and purchase of sex while preserving penalties for sex trafficking activities.

Should either measure pass, it would represent a significant shift in the public attitude towards sex-work. In recent years several municipalities – including Baltimore, Philadelphia, and Manhattan – have stopped prosecuting prostitution-related offenses and, in some cases, expunging records. Research shows positive effects of legalization or decriminalization, including lower incidence of crime and better public health outcomes.

Criminalizing prostitution brings unnecessary harm to already vulnerable populations. The activities of consenting adults should be between them, not arbitrated by the government. Removing these unnecessary laws from state codes will improve the health and liberty of all while eliminating yet another excuse to criminalize targeted populations.

President Biden is proposing to expand federal intervention in many areas that are the responsibility of state and local governments and the private sector. His $2.3 trillion jobs plan would subsidize broadband, automobiles, the electric grid, manufacturing, highways, transit, water systems, and much else. His $1.8 trillion families plan would subsidize pre-school, child care, colleges, paid leave, health care, food programs, and many other things. Every dollar spent on Biden’s plans would be extracted from elsewhere in the economy through higher taxes now or in the future.

Biden’s plans would impose large budget costs, but perhaps a larger problem is that the federal government is the worst institution to tackle the issues the president is focused on. Decades of experience with federal spending programs show that the government suffers from severe political, bureaucratic, and knowledge shortcomings that often make its actions inefficient, harmful, and sometimes disastrous. While federal programs help some people, they usually create costs and negative side effects that outweigh the benefits.

After being in Washington for decades, Biden should know this but he appears to be seized by the urge to exercise power. Younger members of his team are likely ignorant of past federal failures and entertain lofty visions of remaking society. But they should put their dreams aside and study how federal programs actually work. They should read Why Government Fails So Often by Peter Schuck of Yale Law School. He examined federal programs in detail and found that performance has been “dismal” and failure “endemic.” He concluded that,

many, perhaps most, governmental failures are structural. That is, they grow out of a deeply entrenched policy process, a political culture, a perverse official incentive system, individual and collective irrationality, inadequate information, rigidity and inertia, lack of credibility, mismanagement, market dynamics, the inherent limits of law, implementation problems, and a weak bureaucratic system.

I examined the structural reasons why federal programs usually do not add net value to society in this study on aid to the states and this study on government failure. The latter study identified five basic sources of federal failure and the types of failures they generated, as summarized in this table.

Here are brief descriptions of the five sources of federal failure.

First, federal policies rely on top-down coercion, which creates winners and losers, and which displace mutually beneficial market relations. A related problem is that by excluding markets and the price mechanism, federal actions rely on guesswork, which results in resource misallocations and failures. Then in turn, government failures don’t get weeded out as they would in markets because they are funded by coerced taxes not voluntary transactions.

Second, the federal government lacks knowledge about our complex society. That ignorance is behind many unintended and harmful side effects of federal policies. While markets gather knowledge from the bottom up and are rooted in individual choices, the government’s blunt and coercive actions destroy that knowledge and squelch diverse preferences in society.

Third, legislators often act counter to the broad public interest. While America is a democracy, logrolling in Congress allows frequent enactment of programs that do not have majority support in the legislature or in the nation. Once programs become law, they get entrenched and difficult to reform or repeal.

Fourth, civil servants act within a bureaucratic system that rewards inertia, not the creation of value for the public. The lack of firing and performance pay, and the excess of red tape and bureaucratic layering, are some of the problems in the federal bureaucracy. Reforms over the years have tried to bring business efficiencies to the bureaucracy, but there are fundamental reasons why federal agencies will always be inefficient.

Fifth, as the federal government grows larger, its performance deteriorates. Legislators are overloaded by the demands of fundraising, speeches, and constituent service, let alone trying to understand the armada of 2,300 federal programs they have created. Even before the pandemic, the federal budget was 100 times larger than the average state budget, which is far too large for legislators to adequately oversee or control. Furthermore, each new spending program likely produces less value than the last, while the tax costs of funding each new program increases rapidly at the margin.

Biden’s programs would face these and other problems. New programs and related regulations would generate negative and unforeseen side effects, and they would destroy beneficial diversity in state policies and society. Program execution would be poor, and failed programs would not be repealed or reformed. Policymakers would be even more overloaded and have less time for proper oversight. Government performance would decline further.

Rather than unifying the nation, Biden’s proposals would increase anger and division as the federal government forced on the nation more one‐​size‐​fits‐​all mandates on education, health care, child care, automobiles, and many other things. The federal government is far too large already. Americans should reject Biden’s proposals.

Federal government failure is discussed in detail here.