Political Popularity as a Constraint

Suppose you favor Policy A, and you are arguing with someone who favors a less optimal Policy B, but you both agree that either choice is superior to a third Policy C.

You insist that Policy A is optimal. Your opponent insists that if we try to implement Policy A, a populist backlash will turn it into Policy C. If we instead opt for Policy B, we won't get the backlash. We might even gradually drift toward Policy A, but we need B as a stepping stone. You say that's all very well, but plainly A is better than B if only we get it implemented. Questions of realpolitik aside, if A is better than B we might as well say so. Your opponent again cautions you that you can't simply pick policy in a vacuum. Those brutish masses clamoring for bad policy are part of the world, and we can't simply assume them away. "A brief stopover in Policy A followed by collapse into Policy C" is no progress at all.

I recently saw something like this play out between Don Boudreaux and Rick Manning. It was on the question of free trade. Boudreaux favored unilateral elimination of tariffs (call it "Policy A"). Manning favored trade agreements that bilaterally (or multi-laterally) eliminate tariffs (call it "Policy B"). Both were duly afraid of high tariffs, protectionism, and economic nationalism (call these things "Policy C"). Boudreaux was taking the position that even unilateral elimination of tariffs would benefit the nation that does it, regardless of whether its trading partners reciprocate. It's not a prisoner's dilemma, in which both parties need to cooperate to get the reward. Either party can unilaterally make itself better off by eliminating its own tariffs or import quotas. Manning's argument was that unilateral elimination of tariffs leads a nation's citizens to feel like they're getting a bum deal, and protectionism raises its ugly head. It's frustrating to watch. Boudreaux is saying, "Sure, there are political constraints that lead us to pick bad policy. But Policy A is the best possible choice. I might as well say so." And Manning is essentially saying, "Political considerations are hard constraints on what we can actually do. Better choose a path of trade liberalization that doesn't lead to populist backlash." These are my own paraphrases, not actual quotes. (BTW, I thought Manning was rude and made borderline sexist remarks. "I can't support an import ban on chocolate because my wife would object!" And in case you didn't get this knee-slapper the first time, he repeats it. His dismissal of Boudreaux's graduate assistant's scholarship struck me as incredibly rude. But I absolutely take his point about acknowledging the realities of politics.)

I found this interesting. It is usually the libertarians who are reminding leftists and conservatives of political constraints. "You don't just get Obamacare as envisioned by its authors, rather you get Obamacare as implemented by a future Republican congress, and implemented in states with Republican leadership and Republican governors. You can't just say it's good policy in a vacuum, assuming away all of those nasty people who don't agree with you." The political process imposes hard constraints on what kinds of policies are actually feasible. If your policy to correct market failures requires an all-wise and infinitely compassionate bureaucrat to actually implement it, it's going to fail. Even if it requires merely above-average-yet-still-mortal intelligence and civic-mindedness, good luck finding enough competent and self-motivated people to run your bureaucracy. In fact, forget that. Good luck getting your grand scheme passed through the political process without being hopelessly mangled into something else. A political favor here, a carve-out for government unions there, a concession or two to legislators who are up for reelection this year, and the grand scheme to optimize society gets morphed into something nobody actually wanted.

(Note that this post is not about Obamacare. I could write an identical example about neoconservative nation-building being hamstrung and underfunded by Democratic opposition and eventually taken over by a future Democratic leadership and perhaps abandoned by an exhausted or apathetic voting public. If you can imagine such a thing happening. This constraint is bipartisan.)

It's interesting to think about how this same political hobbling might apply to libertarianism. A grand mobilization to shrink government could conceivably backfire, and the populist backlash could leave us with more government (or anyway worse government) than we had before. I'm not sure how much I really buy this idea, but it's definitely something libertarians need to think about. Maybe legalizing drugs suddenly, rip-off-the-band-aid style, would lead to a temporary surge in overdoses while people figure out which drugs are truly dangerous and in what dosages. Maybe this would lead to a crackdown and leave us with even worse drug policy than we currently have (supposing that's possible). Or maybe we'd have blown the one chance in a generation to accomplish drug liberalization. The traumatic experience will take even milder liberalizations off the table, even if a temporary rise in overdoses is a perfectly acceptable loss from a utilitarian point of view. Most members of the voting public just don't have the patience or the bandwidth to process these policy questions. Stark yet misleading examples loom large.

Likewise, maybe a temporary experiment with open borders leads to a few minor terrorist attacks. Opponents of open immigration say, "See!" The voting public, oblivious to the utilitarian calculation, over-weights a few murders without comparing them to the millions of lives lifted out of poverty. They say, "Yes, I see. Close the borders down!" Again, the experiment could ruin immigration reform for a generation.

Maybe a tax reform includes lots of future cuts to government spending, but if those cuts don't actually happen we'll just end up with higher and less efficient taxes in the future. And maybe no sane person believes those cuts will actually happen.

I still think I should state clearly and honestly what the best policy is, without regard to political considerations. I'd love to see open borders, or even nearly open borders with basic background checks. I'd also love to see something more likely, like expanding immigration from ~1 million a year to ~2 million a year. But I think vastly liberalized immigration verging on fully open borders is better policy, and I might as well say so. I also think that complete and instantaneous drug legalization is probably better than a slow draw-down of existing penalties and barriers. I sometimes argue in favor of these other policies, like punitive taxes or user licensing, that achieve what current law tries to achieve more effectively and humanely and cheaply. "Drug legalization light" is probably more politically palatable and less likely to cause a backlash. But I still think that full legalization without guardrails is the better policy, and I feel I should say so honestly. If I were in a position to actually make a political deal and shape policy, I'd change my tune.

I also think it's possible to change the minds of the voting public. I know it's crazy, but I've seen it happen. If we say "Policy A is better than Policy B" often enough and clearly enough, maybe the voting public will come around. We shouldn't have to settle for "sub-optimal but palatable" policies. So there is a niche for people like Don Boudreaux, who ignore the political constraints and openly speak their minds.

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I feel like two different concepts crept into my discussion of political constraints. One is popularity. Given enough political will, this constraint disappears. If there is political will for immigration reform, drug legalization, or tax reform, it will happen. The other concept is intrinsic government inefficiency. The incentive structure for government is inherently different than it is for voluntary institutions. You can't just "quit" a bad government program; you have to continue paying for it and perhaps submitting to it or being punished by it. All the political will in the world doesn't fix this problem. Unless the voting public becomes infinitely vigilant, government institutions will not be as responsive to their "customers" as voluntary institutions. Bureaucracies will seek to maximize their budgets while individual employees seek to minimize their workload. Some gunner-bureaucrats may seek to maximize their authority and acclaim, perhaps in pursuit of a nicer job or political career. Private bureaucracies have these problems, too, but they more quickly run up against budget constraints and the vetoes of shareholders and ultimately their customers. I meant for this post to be about the first kind of constraint, but lapsed into talking about the second kind.