Our Democratic Conundrum

Our Democratic Conundrum
December 29, 2009

Let’s look at three particularly appalling examples of federal spending.

The federal government spends billions subsidizing corn-based ethanol. Ethanol reduces mileage in cars, causes untold damage in small motors, increases pollution on a life cycle basis, uses more energy to produce than it creates, and has led to food shortages and riots throughout the developing world. There is no sound policy reason for this subsidy.

The federal government spends billions of dollars on the Medicare Advantage program. Created to provide Medigap coverage in rural areas, Medicare Advantage has grown wildly. It costs, on average, 15% more than comparable coverage. The same coverage could be provided directly at far lower cost. There is no sound policy reason for this subsidy.

The federal government continues to buy one new Virginia class submarine each year. Each one costs nearly $3 billion. The Virginia is a fast-attack sub meant to neutralize Soviet fast-attack subs, which do not exist any longer. They are too valuable a platform to use for coastal work or to deliver special operations forces. Their 12 cruise missiles are far too few to be an effective supplement to other stand-off assets. It is a boat without a mission. There is no sound policy reason for this subsidy.

Yet, billions are wasted on these three, and hundreds of other, foolish and hideously expensive federal programs. Why? Because there are powerful political forces that ensure that these subsidies continue. Surely, some of those forces are vested economic interests, like agribusiness, defense contractors, and health insurance companies. Some of the pressure comes from labor unions and local municipalities. And, much comes from local constituent pressure.

The fact is that the US budget deficit is wildly out of control with this past year’s deficit of nearly $1.5 trillion. Our national debt is the highest, as a ratio to GDP, in history and is projected to triple over the next 20 years. This load of debt is unsustainable, both because it is owed to foreigners who will increasingly intervene in our affairs to protect its investment and because debt leads inexorably to hyperinflation. We need to reduce the debt. It is no longer a choice between cutting spending and raising taxes. We need to do both. Aggressively. Now.

Yet, the continued existence, and indeed expansion, of these wasteful programs makes it clear that Congress cannot handle the task. On one level, we face the partisan wars where the tea-baggers and birthers accuse Democrats of being socialists when they mention revenue enhancement and labor unions and liberal interest groups accuse Republicans of killing the poor whenever they propose cuts in social programs. On another level, we have individual members of Congress who need millions for re-election. That money can only come from special interests who expect favors in return. And, no member of Congress has ever secured reelection by cutting a special benefit for his or her district, whether that benefit be subsidies to farmers, construction of submarines, or a gold-plated version of Medicare.

The alternative is to turn these policy decisions over to the Executive Branch, whether directly to a federal agency or indirectly to a commission. Such a delegation clearly flies in the face of representative democracy. We have, of course, done it in the past on base closure and social security, and there are those pushing for such an undemocratic delegation to a commission now. In fact, it may be the only way to deal with the debt.

Still, I am troubled by the future of American democracy. Clearly, full public funding of congressional campaigns and eliminating free speech protection for corporations would help, but the current Supreme Court will block both of these routes. Even these changes would not reduce constituent pressure for special benefits and would weaken but not eliminate special interest pressure on members of Congress.

I have no solution. Some say we need stronger members of Congress with more integrity. This is a rather silly proposition. The Constitution is based on members of Congress and Senators seeking re-election. That is where their accountability to their constituents in enforced. The system is not based on elected representatives doing things their constituents oppose. Our current crop of Senators and Representatives contains geniuses and idiots, heroes and cowards, honest folks and crooks. Under the Constitution, their job is to secure re-election. Under the current rules, raising money from special interest groups is one essential way to do that. And, of course, that special interest money comes with strings.

Again, I have no solution. I do seeing our debt crisis leading to the greatest challenge in American history. Unless we find a way out of this conundrum, our existence as a nation is threatened in a way more immediate and profound than every before.