A post at Free Exchange, the Economist’s blog, which quotes and elaborates on one by Tyler Cowen, posits that Europeans are better at government because they have more homogeneous societies and talent pools, and therefore Europeans choose to consume more government. Americans are better at things like private sector innovation, and therefore its population demands that.
It’s a provocative argument, and has the virtue of sounding intuitively correct, but it’s easy to see where it is going: Americans are bad at government, for inherent reasons, and therefore looking for government to solve anything is going to yield results inferior to what Europeans can achieve. That’s a new angle for rejecting government intervention.
But how true is this as an explanation? It might be just as true that Europeans have assumed that the state can play a useful role, and have just kept at it longer, while we have gone through interventionist and non-interventionist phases (in other words, consistency of effort has produced better outcomes). And there may be important structural differences. The US has a major changing of the guard every time the party in power changes; many (most?) European countries have a tradition of an elite bureaucracy, so the replacements doesn’t go as deep into the various bureaus.
Similarly, I don’t buy the “homogeneity is destiny” argument. 25% of the Australians are first generation, many from Asia, yet it is a high-tax, high government service economy, with a high minimum wage and a successful (although somewhat stressed) universal healthcare program. Most Australian are generally happy with the outcome. The Liberal Party is admittedly trying to move to more of a US model (which many Australians abhor), but even those moves are nanny-state-like. For example, in place of Social Security, it has a superannuation program, where all workers are required to 9% of their salaries in “superannuation” accounts (it may be easier for Australia to do this than other countries because it never had a history of terribly generous benefits to the elderly).
That is a long winded way of saying that while there is a good deal of truth in the “Americans are bad at government” theory, that is no excuse for throwing up one’s hands and giving up. The Japanese knew that they were no good at making cars when they came to America in the early 1960s and studied our auto industry. It only took them about a generation to not simply close the gap between their manufacturing techniques, but to beat us. And they managed to find ways to turn their cultural differences to their advantage. And it may be that a big part of our problem is that we aren’t willing to learn from anyone else.
If I were to point to a single obstacle to the US achieving good government, it’s one not mentioned in this post: wealthy, influential special interests. The reason we can’t have some form of single payer healthcare is that it would be the end of most health insurance companies, and also imply reduced profits for big Pharma. Funny how we are willing to lower trade barriers and accept unemployment of blue-collar workers as an inevitable cost of progress, but not of white collar workers or investors.
Wait, I have a simpler idea. Let’s just outsource our government to France.
From “Over there,” at Free Exchange:
Tyler Cowen proposes a simple model of Europe and America:
Western Europe, that is. Europe is better at producing (many) public goods through the public sector. Europe has more homogeneous nations with more urbanization, higher levels of social cohesion, and a more even distribution of ability. America is better at resource mobility, private sector innovation and catering to elites.
Because European government works better, Europeans demand more of it and get more of it. American liberals look at Europe and see (sometimes) better results per dollar spent. They then conclude that America should be more like Europe, whereas in reality America would end up spending more to get more bad American government. They also conclude that defenders of the American market-based order simply ignore the evidence before their eyes, evidence which supposedly shows the superiority of social democracy.
Market-oriented types look at Europe and think it is on the verge of collapse, when it isn’t. They can’t imagine that it doesn’t, in every way, have American-style government failure.
Europe benefits more from America being American than America does from Europe being European. Ideas — America’s strong point — are more likely to be international public goods than good governance — Europe’s strong point.
Lovers of Europe should be especially concerned to see America remain so inegalitarian. But in reality American social democrats care mostly about their own country. They think that enough changes would make America enough like Europe; I do not understand their underlying model of the differences between America and Europe, and thus I think they are badly wrong. Policy is not an exogenous or all-determining variable.
This makes a great deal of sense to me. Europe’s nations, even Britain (though to a lesser extent), have an essentially tribal definition of themselves. You are a Frenchman because you were born, and raised, of us. America, on the other hand, defines itself by the adoption of certain premises. I personally know avid Americans born in Ecuador, Spain, France, Britain, Mexico, Australia, China, Saudi Arabia, Germany, and Surinam . . . and others I can’t think of at the moment. I speak not of people who were born there but raised here. I mean people who still have an accent and always will, but who think of themselves as American. In the end, all you really need to be an American is a desire to be one*. On the other hand, as a friend of mine pointed out the other day, if you are the child of an American mother and a French father living in the north of France, you will be regarded as not quite French even if you have lived there all your life and speak no other language.
National unity makes for better government. People are more willing to support it, because it is more likely to express broad cultural norms; and because they view the people it cares for as an attenuated sort of family. Also, homogeneous cultures can police generous benefits in a way that heterogeneous nations cannot. In Denmark, if you’re obviously abusing the welfare system, the neighbours will be snippy (or so I’m told); conversely, if you are genuinely in need, they can provide vital social support to go with the benefits. In America, long histories of ethnic conflict, not to mention many, many different sets of cultural norms, make it nigh-impossible to generate any sort of moral consensus on who deserves what from government; the result is abuse, nasty interest group politics, and a bureaucracy at best marginally interested in its “clients”. Also, as Tyler hints, I think the political institutions designed to deal with a far flung and diverse people are a barrier to creating good government programmes. Thankfully, they are also a barrier to creating bad government programmes, which is why I think the American economy remains more innovative and entrepreneurial than Europe’s. But the point stands: you probably can’t get a smoothly functioning welfare state like Denmark’s with America’s fragmented and quixotic political institutions.
Advocates of a European-style welfare state in America generally do a very poor job of explaining how they will adapt such things to American institutions, culture, and the legacy of existing systems. When they do attempt to attack that problem, they often end up in the same place as radical libertarians: advocating a thoroughly infeasible gut renovation of the American political system.
Perhaps there is a new American model that doesn’t rely on some sort of shared national consensus that could be built to provide these public goods. But I haven’t heard any candidates so far.
