Category Archives: Public Policy and Governance

Infrastructure, Part Two

Yesterday, I shared Adam Gopnik’s “take” on Republican objections to infrastructure investments. But it turns out that he is not the only one considering the ideological roots of the Right’s disinclination to invest tax dollars in public goods like  roads, bridges, and railroads.

A lengthy post at Daily Kos ticked off some specifics.

Over and above the general animus toward government, manifested in a desire to “starve the beast,” the post pointed to the Right’s continuing romance with privatization.

More than anything else, this privatization fetish explains Republicans’ efforts to gut and discredit public infrastructure, and it runs the gamut from disastrous instances of privatizing parking meters to plans to privatize the federal highway system.

There has been a good deal written about these and other efforts to outsource what we used to consider public functions, but there has been much less information available about a financing mechanism that makes these privatization deals much more lucrative–private activity bonds.

As the New York Times recently explained,

These deals involve so-called “qualified private activity bonds,” which state and local governments issue on behalf of corporations. The bonds allow companies to borrow at low rates, while the bondholder doesn’t owe federal tax on interest. (If a corporation issued its own bond, it would pay a higher rate and the bondholder would owe tax on interest.) As an article in today’s Times explains, the justification for this sort of treatment is that a private project will fulfill a public need. In practice, it often looks like pork by another name, worth roughly $5 billion a year to corporations that could afford to invest without a subsidy, or to vanity projects — like a winery in North Carolina, a golf resort in Puerto Rico and a Corvette museum in Kentucky.

Meanwhile, across the board spending cuts threaten needless hardship and real suffering, and congressional Republicans won’t even talk about ending or trimming private-activity bond subsidies — or, for that matter, any individual or corporate tax breaks, which total $1.1 trillion annually. $1.1 trillion. That’s more than Medicare and Medicaid combined. It’s more than Social Security. It’s nearly two thirds more than the total cost of all non-defense discretionary spending, the category that includes infant formula for poor mothers and infants. Corporate welfare has never been so costly.

I have a friend who lobbies for socially-responsible organizations–environmental groups, human services nonprofits and the like. When I ask him why the legislature has done thus-and-so he just smiles and tells me to “follow the money.”

These days, greed–masquerading as “creative financing” or “economic development”– consistently trumps the common good.

 

Infinitely Depressing, If True

Adam Gopnik recently wrote an essay in the New Yorker that has continued to nag at me–not because he is wrong, but because I’m very much afraid that he’s right.

Here are the pertinent paragraphs:

What we have, uniquely in America, is a political class, and an entire political party, devoted to the idea that any money spent on public goods is money misplaced, not because the state goods might not be good but because they would distract us from the larger principle that no ultimate good can be found in the state. Ride a fast train to Washington today and you’ll start thinking about national health insurance tomorrow.

The ideology of individual autonomy is, for good or ill, so powerful that it demands cars where trains would save lives, just as it places assault weapons in private hands, despite the toll they take in human lives. Trains have to be resisted, even if it means more pollution and massive inefficiency and falling ever further behind in the amenities of life—what Olmsted called our “commonplace civilization.”

Part of this, of course, is the ancient—and yet, for most Americans, oddly beclouded—reality that the constitutional system is rigged for rural interests over urban ones. The Senate was designed to make this happen, even before we had big cities, and no matter how many people they contain or what efficient engines of prosperity they are. Mass transit goes begging while farm subsidies flourish.

But the bias against the common good goes deeper, into the very cortex of the imagination. This was exemplified by New Jersey Governor Chris Christie’s decision, a few short years ago, to cancel the planned train tunnel under the Hudson. No good reason could be found for this—most of the money would have been supplied by the federal government, it was obviously in the long-term interests of the people of New Jersey, and it was exactly the kind of wise thing that, a hundred years ago, allowed the region to blossom. Christie was making what was purely a gesture toward the national Republican Party, in the same spirit as supporting a right-to-life amendment. We won’t build a tunnel for trains we obviously need because, if we did, people would use it and then think better of the people who built it. That is the logic in a nutshell, and logic it seems to be, until you get to its end, when it becomes an absurdity. As Paul Krugman wrote, correctly, about the rail-tunnel follies, “in general, the politicians who make the loudest noise about taking care of future generations, taking the long view, etc., are the ones who are in fact most irresponsible about public investments.”

I remember thinking, when Christie made this decision, that he was simply crazy. In a sane world, refusing to provide demonstrably needed infrastructure–especially when it is virtually cost-free for one’s state to do so and when it will also generate desperately needed jobs–makes no sense at all.

But that assumes that, in a sane world, there is such a thing as the common good.

 

 

 

American Opinion and Climate Change

“Thoughtful and informed”? Really? When was the last time you heard someone not wearing a tinfoil hat describing the American public as “thoughtful and informed”?

And yet…

Jon Krosnick is a professor at Stanford who studies Americans’ attitudes about hot-button issues. He’s surveyed opinions about climate change since 1995. As he points out, on most issues, voters are pretty evenly split;  so anything a candidate says will annoy about as many people as it pleases. There’s no net benefit. But that isn’t true of green points of view.

Many Americans, including people in Washington, do not realize how one-sided the public is on this. If they did, they would change their approach. I’ve been to Capitol Hill to talk to legislators and they’ve said: “You’re doing national surveys. I don’t think the people in my state feel that way.” So we’ve started looking at states and haven’t found a single state where a majority of residents are skeptical, but legislators think they are. West Virginia, Oklahoma, Texas — even in those states, large majorities are expressing green points of view….

What we’ve found is about 80% of Americans — I never see 80% of Americans agreeing on anything when it comes to other issues, so this is very unusual — believe the federal government should limit greenhouse gas emissions by businesses and in particular by public utilities.

Krosnick did say that Fox News viewers tend to be an exception to this majority consensus–and noted that it is impossible to know whether that is because Fox misinforms its  audience, or because the audience is composed of individuals who choose to watch Fox in order to have pre-existing beliefs confirmed.

The next time James Inhofe throws a snowball in the Senate chambers to “prove” climate change is a myth, someone should tell him that a “thoughtful and informed” public has moved on. A long time ago.

 

If We Were Starting Over….

Every couple of years, I include a favorite question on the take-home final I give my graduate students. It’s probably time to retire it, but before I do, I’m curious to see how my blog community might answer it.

Earth has been destroyed in World War III. You and a few thousand others—representing a cross-section of Earth’s races, cultures and religions—are the only survivors. You have escaped to an earthlike planet, and are preparing to create a government for the society you hope to establish. You want to establish a new system that will be stable and enduring, but also flexible enough to meet unforeseen challenges. You also want to avoid the errors of the Earth governments that preceded you. Your answer should include the choices you make and the reasons for those choices, including: The type/structure of government you would create; the powers it will have; the limits on those powers, and methods for ensuring that those limits are respected; how government officials and policies will be chosen; and the fundamental social and political values you intend to inculcate and protect.

Most students respond by creating a system similar to the American model, with “tweaks”–usually things like universal health care or a constitutional amendment to the effect that money doesn’t equal speech. But on occasion, I’ll get a truly creative response–sometimes radically libertarian, sometimes communitarian/socialist.

The little community that has emerged in the comment section to this blog is demonstrably thoughtful and knowledgable. I’d be very interested in your responses to this “thought experiment.”

If humanity was starting over, and you were the one who got to make the decisions, what decisions would you make? What would a just and effective government look like in your brave new world?

Go!

Privatization, Truth-Telling and Easy Answers

As I previously noted, I’ve been bemused by the level of interest in prison privatization displayed by my students this semester. The subject of contracting out in general, however, is a staple of my Law and Policy course.

Use of the term “privatization” is a misnomer; the impression is that a service or task is no longer being provided by government. That is rarely if ever the case, at least in the U.S. The term typically refers to a decision by a government agency to contract with a nongovernmental business or organization to provide a government benefit. Government continues to use tax dollars to pay for that service or benefit, and remains responsible for its proper delivery.

Sometimes, contracting out makes a lot of sense. Sometimes it doesn’t. So our class discussions are not “should we or shouldn’t we;” instead, we consider when and how. 

Unfortunately, in far too many venues, what should be a thoughtful consideration of relevant factors has become yet another ideological litmus test, with predictable consequences. An example:

When he was governor of Florida, Jeb Bush privatized veterans’ health benefits. It didn’t go well. As CNN reported

Bush’s experience outsourcing veterans’ nursing homes in Florida was a case study in privatization’s pitfalls. By the time it was over, Florida officials determined the state could provide higher-quality care at a better price for taxpayers.

Despite what should have been a sobering experience (click through for the details), Bush’s campaign continues to insist on the virtues of privatization, and claim it is “the remedy” for the problems experienced by the Veterans Administration.

I’ve picked on Bush, but there are hundreds of other examples, because we voters reward politicians who have bumper-sticker remedies for what ails us–politicians selling simple answers to complicated problems. (Are teenagers dropping out or getting pregnant? Put prayer back in schools! Is the economy underperforming? Cut taxes!) (Actually, “cut taxes” seems to be the one-size-fits-all solution for far too many politicians. Measles epidemic? Potholes? Crime wave? Whatever the problem, the reflexive answer is “Cut taxes!”)

The problem is, simple answers sell. We voters are far too ready to buy snake-oil, and far too reluctant to accept the reality that sometimes–not always, but often–the real answers begin with a recognition that “it’s complicated” and “it depends.”