Planet DC

Washington: A National Zoo?

There is something other-worldly about Washington. Power, wealth, poverty, urgency and complacency are in the air. It is disorienting, amazing, distressing. I got a chance to experience this world up close in July thanks to a month-long mission to Planet DC.

Although I travel there often, this was my first extended visit to the city in a couple of decades: a chance to settle in, observe and swim in the sea of local life. It left me in a funk that has continued after my return to Paris. I am still trying to process all that I saw and experienced.

My mission

During July, I had the opportunity to pursue my economic research agenda in Washington, DC, operating as a visiting scholar based at a Federal government agency. I was struck by the dedication and competence of my colleagues there as they pursued their duties.

They believe in their mission and are seeking to improve policies and government operations. In the same spirit, they generously took time to provide me with constructive input and suggestions for advancing my policy research.

Time and again their positive energy amazed me. Theirs is not always an easy lot. Federal employees encounter many daily challenges including consequences of budget cuts, periodically hostile press and politicians, arbitrarily compromised objectives, and stakeholder conflicts, among others issues.

My agenda involved a series of interviews with experts (government, private sector and academic), collection of data, and research to track down various reference materials. I had the opportunity to travel far and wide across the city and to meet folks from various walks of life. To say the least, the city exhibits quite some cultural and economic diversity.

Quest for excellence

As a young Peace Corps volunteer in Burkina Faso (West Africa) broiling under the intense mid-day sun of the hot season, I discovered the joys of pulling up a chair in a shady spot outside of our mud hut and reading. Not much else was going to happen until things cooled off. It was during such a season back in 1983 that I found the time to read Robert Pirsig’s Zen and the Art of Motorcycle Maintenance. I had never read anything like it. The book describes a motorcycle trip across the United States and an inquiry about values. A central theme for me concerned the importance of the quest for excellence, a message that has stuck with me since.

As the political capital of the largest national economy in the world, Washington is certainly in the position to cultivate excellence. There are some impressive manifestations of this. To cite a couple of examples from my recent mission:

• Library of Congress – During the course of my research I had the opportunity to visit the Library of Congress, which is certainly a fine historical example. The Thomas Jefferson Building (1897) is a world-class architectural gem. I witnessed people from around the world gawking at the grandeur of reading room. Moreover, the collection itself is also extremely impressive. I took advantage of this to track down references that I’d been unable to obtain in Europe.

• US Botanic Garden – A more recent example of such excellence is the renovation of the US Botanic Garden, which included establishment of the adjacent national garden. The US Botanic Garden, originally established in 1820, is just up Independence Avenue from the Capital Building and Library of Congress. The renovation of the greenhouse, a Bartholdi fountain (Bartholdi also sculpted the Statue of Liberty), and gardens greatly moved me. Completed in the past decade, this effort resulted in a facility that provides for education, art, entertainment and, in my view, spiritual renewal. It is a place of beauty and yet somehow the renewal was accomplished in a time of tight budgets and partisan in-fighting.

Of course there are many, many more examples across the city. Such examples demonstrate that there can be a positive role for government in contributing to our advancement directly or in partnership with the private sector and non-governmental organisations.

But, on the other hand…

Despite encounters with excellence as I wandered through the world of Washington, there were nonetheless some concerns nagging at me everywhere in the background. These concerns started with the impression that part of the infrastructure is in poor condition. They grew as various contacts and news items pointed to social challenges, civil rights issues, undue impediments to legitimate businesses, environmental degradation and other pressing issues. Some are local, while others are a reflection of national malaise. Although Washington came through the Great Recession with less damage than some other parts of the US, it is not fully insulated and the challenges are visible.

Storm Clouds over the Old Executive Office Building

My concerns deepened after an admonition from my host to be careful during my commutes into town. He had been stabbed in a mugging a while ago and held up at gunpoint another time. As an economist I am concerned with such problems and their many social and economic roots, but I am not used to facing them as a personal threat on a daily basis.

Then, there was the metro. I recalled the system with an initial sense of pride, thinking back to my days in DC during the 1980s. Nowadays, however, it is only just getting a much needed makeover after years of relative neglect. In July, during a brutal 10 day heat spell, I discovered that the system operators were no longer maintaining the air conditioning on the cars where it had broken down. Commuters were faced with the choice of running from car to car in search of A/C or potentially having to tough it out in a crowded, non-air conditioned carriage.

Next came political issues. A few weeks after my arrival, Bill Moyer’s had an interesting show on Washington, DC, based on a very troubling interview with Mark Leibovich. Leibovich recently authored “This Town“, a book about the workings of the place. He highlights the problem of the rotating door in DC between policy making and lobbying, political fund-raising and interest peddling. He highlights what is essentially a disconnect between the objectives of many of the powers-that-be and the national interest. The insiders with ties to either of the main political parties have access to potentially large incomes if they work on behalf of various vested interest groups. Thus, there are disincentives to tackle issues head-on. Unfortunately, in the interview Leibovich does not offer much in the way of solutions.

Partly as a consequence of the insiders game, progress to obvious problems comes slowly. Outside of the political realm, I have the impression that many average folks are hunkered down living busy lives and, in many cases, dealing with some financial stress. Several news items came up during my stay that underscored the problem. One item showed labor income declining as a share of national output while inequality increased:   see this article from the Federal Reserve Bank in Cleveland. After progressing somewhat in the 1990s, median household has been falling significantly. Another item came from a study by the Economic Policy Institute, showing US workers putting in more hours in a effort to maintain incomes. Then, more recently, Robert Putnam presented an op ed on Crumbling American Dreams using his home town as an illustration.

There were other national news items that added to the gloom:

• US Health – Recently, a spreadsheet from the Organsation for Economic Co-operation and Development (OECD) caught my eye: OECD Health Data. New data on health developments in 34 wealthy countries of the world were just released. The United States was at the top of the list for healthcare expenditure, spending some 17.7% of GDP in 2011 (GDP is an indicator of our economic output). This was nearly twice the health expenditure in OECD countries on average: 9.3% of GDP. Moreover, US healthcare expenditure is far ahead of the other countries: second place goes to Netherlands, but even they spent just 11.9% of GDP.
  What do we get for our large expenditure? In 2011, American women on average at birth have a life expectancy of 81.1 years, whereas in the average OECD country, women can expect 82.8 years. For American men, the figure was 76.3 years, whereas the average OECD country offered its men the prospect of a life expectancy of 77.3 years. In Netherlands, women and men at least have something to show for their above-average health expenditure. That is, they have above-average life expectancy: 83.1 years for women and 79.4 for men. In the US, we are paying nearly twice as much as the OECD average and our lives on average are shorter by a year or more.

• Climate change – Then, there were several items on climate change developments. One that really came as a wake up call was authored by James Hansen et al (2013) on Climate Sensitivity, Sea Level and CO2. The authors provide compelling evidence that the damage from the C02 already pumped into the atmosphere is not yet fully manifest due to lagging responses from some natural systems, and that if we continue we can expect significant impacts in terms of sea level rise and disequilibrium in key natural systems. According to these authors, if we persist in use of all available fossil fuels, we can expect this: “Burning all fossil fuels, we conclude, would make much of the planet uninhabitable by humans, thus calling into question strategies that emphasize adaptation to climate change.”

• Voting Rights – There were other news items from several states on voter disenfranchisement in the aftermath of the Supreme Court’s invalidation of a key portion of the Voting Rights Act. Taking North Carolina as an example, the Huffington Post reported on proposed changes that eliminated college students’ ability to use their state-issued student IDs for voting purposes, reduced early voting by a week, eliminated same-day registration, ended pre-registration for 16- and 17-year-olds and a student civics program, killed an annual state-sponsored voter registration drive and lessened the amount of public reporting required for so-called dark money groups, also known as 501(c)(4)s.

• Impediments to business – It is not all a bed of roses for business either. There are bureaucratic and regulatory barriers and other challenges related to government dysfunction. One example can be found in the World Bank’s Doing Business Indicators.  The “paying tax” indicator shows that the administrative burdens in the United States are far in excess of other leading countries (and, it is not just the tax rates, but also the hours it takes to comply administratively with the requirements). According to this tax burden indicator, the United States ranks 69th among the world economies, just below Madagascar and just ahead of Mongolia. Hardly a leadership position!

These matters are serious and getting clear information about each issue is not always easy. One cannot rely on the evening news for balanced reporting and it takes a bit of digging to identify a reliable source of factual information. Still, the cumulative effect of this news flow is daunting. I can certainly appreciate the urge to keep one’s head down and to press on with more immediate daily challenges. Unfortunately, a failure to respond to some of these issues will entail heavier costs if one waits to address them later.

Next steps?

This is not to say that I am pessimistic. I was encouraged to find people inside and outside of government working to assess problems empirically and seeking a factual basis for discussing policy options and responses. In addition, there is an emerging debate in the United States that recognises the limits of empirical assessment and the need to have an open debate about the subjective aspects of some policy questions such as dealing with inequality. For example, see this paper on income inequality by G. Mankiw, a former Bush administration official. I don’t agree with all of his suppositions or conclusions, but it is a useful starting point recognising the role of preferences. It has unleashed a helpful debate.

I think we also need to be open to consideration of the role of government as part of the solution. This was underscored to me upon my return to France. I spent my Saturday here running errands on foot, using public transportation and walking to shops past some wonderful public spaces: a forest park, a new fountain, newly repaved roads, and a public-private redevelopment zone downtown. France has many economic problems of its own. For example, the state is large and weighs heavily on entrepreneurship. But, the French example does underscore the benefits of having some public investment in areas where there is a need for a coherent system-wide plan or where there is a market failure. We should not rule this out now in the United States. There are positive examples in the US as well: for example, the initial development steps for the Internet. Government has contributed on occasion to attainment of excellence!

Reviewing the list of issues discussed above, I certainly seems that there is need for action. In the United States, we need to break out of our complacency. We need to challenge the system to do better and to be more responsive to unmet needs. We should not accept business as usual in “This Town”. And, once we have decided that there is a role for government in provision of a given service, then we should insist on government’s quest for excellence in the matter. Why should we the citizens and taxpayers accept anything less?