At the Court of the Sun King: The Vice of Centralization

What can be said of the Obama administration? This is not Roosevelt’s 100 days: it has left no permanent impression on the American economy or government. This is no reform administration, though it follows 16 years of inadequate presidential leadership. When it is considered that the Defense, State, Treasury and Justice Departments are all led by the alumni of two failed administrations, no one had a right to expect an administration which, in Wilson’s words, would “cleanse, reconsider, and restore.”

There has been a stimulus bill, which holds the states harmless from any need to rationalize their pension and retirement benefits and public school systems. Twenty-year retirements, Cadillac health insurance plans, and lockstep seniority increases are left undisturbed. Two bills, drafted in the House Democratic caucus and on K Street address health care and global warming; both aggrandize federal executive power , while providing new opportunities for Wall Street and the insurance companies. The abuses of options and derivative trading remain unreformed and indeed uninvestigated; the Senate of Hugo Black and David Walsh is now the Senate of Charles Schumer and Chris Dodd. Education ‘reform’ takes the form of continuation of the Bush administration’s top-down tinkering, care being taken not to threaten the education schools, single-salary schedule, or huge county bureaucracies.

Baby steps have been taken to reform drug policy; the states may decriminalize possession , but are precluded from creating lawful channels of distribution. The worst abuses of the ‘terror war’ have been curbed, but there has been no systemic reassertion of Justice Jackson’s principles: “that the executive power be under the law, and that the law be made by parliamentary deliberations”; that “emergency powers are consistent with free government only when their control is lodged elsewhere than in the Executive that authorizes them”; and that “procedural due process must be a specialized responsibility within the competence of the judiciary on which they do not bend before political branches of the government.”

If there is a program for transportation funding and congestion relief, the administration has not vouchsafed it; gasoline taxes and congestion charging have been all but renounced . Farm subsidies and bargain leases of public lands for grazing and mining continue, as does neglect of soil conservation and flood control; new dust bowls loom, while the departments of agriculture and interior have been treated as political throwaways. Federally-assisted housing is the playground of a few politically-favored developers in each major city; mention of foreign initiatives like accessory apartments, land readjustment districts, pre-school playgroups and old age clubs draws a blank stare from American housing bureaucrats and their Congressional protectors.

Foreign policy has been buffed at the edges, but its making has been turned over to a figurehead secretary of state and a multitude of special envoys and ‘czars’. Two wars continue, as does the over-use of economic sanctions and non-recognition as foreign policy tools. Unilateralism continues; we are to be involved everywhere; the Europeans, Russians and Chinese are to be listened to only when and as they agree with us. This is not the Bush administration redux, but it is the Clinton administration redux.

There is another way, but it has not been taken. It would involve renunciation of both centralization and unilateralism. Legislation would not take the form of 900 page bills appearing to be the work of an intoxicated centipede, but would in Learned Hand’s words “proliferate a purpose.”The laws creating the Social Security System and the British National Health Service were each about 5% of the length of the Democrats’ recent creations. Professor Hayek’s principle of “uniform rules laid down in advance”has much to be said for it; what people want is what Kipling called “Leave to live by no man’s leave/ Underneath the law.”The primary care provisions of the British health service were wildly popular when adequately funded; they rest on a single-payer voucher system that frees doctors from claims forms and meager payments from multiple insurers. The higher reaches of the system require market signals, provided in American experience by President Reagan’s enacted but short-lived plan for catastrophic insurance, which should be re-enacted with a more adequate revenue base. A properly educated public will accept gradually increasing gasoline and carbon taxes in preference to a cap and trade scheme gutted by lobbyists and understood by no one except the investment bankers who will profit from it.

As for business regulation, the insurance industry, which is actually solvent, should remain (Sarah Palin to the contrary notwithstanding) under the state control in which it was placed by Charles Evans Hughes’ reforms in New York and left by the Mc Carran-Ferguson Act. The Glass-Steagall Act and Public Utility Holding Company Act should be restored insofar as it is possible to do so, and further speculative mergers discouraged. The New Deal reforms produced a fifty-year period in which financial failures were unknown , power was cheap and reliable, and proxy statements of banks and public utilities could be read without inducing nausea.

In such a regime, both free markets and public facilities would have a place, but the state capitalism of the Paulson-Geithner era would be brought to an end. Reform of science teaching in high schools and of the drug war would be regarded as of equal importance to ‘global warming’ and reform of health care. School reform would be an exercise in self-liquidating power which would entail weakening the vise-like grip of the teachers unions and education schools, by requiring all federally-assisted schools to have community governance by their own boards, unimpaired by certification requirements and restrictions on personnel changes and compensation imposed by union agreements,

That Mr. Obama is sincere in his centralizing exhortations there is no doubt. But Tocqueville could have explained to him why they fall on so many deaf ears: “Sometimes the centralized power, in its despair, invokes the assistance of the citizens; it says to them” ‘You shall act just as I please, as much as I please, and in the direction which I please. You are to take charge of the details, without aspiring to guide the system; you are to work in darkness, and afterwards you may judge my work by its results.’ These are not the conditions on which the alliance of the human will is to be obtained; it must be free in its style, and responsible for its acts or (such is the constitution of man) the citizen had rather remain a passive spectator, than a dependent actor, in schemes with which he is unacquainted

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