Anti-Intellectualism and Magical Thinking

A couple follow-up thoughts on DougJ’s response to my Little Republics post.

First of all, I think the charge of anti-intellectualism is a little off the mark. I have absolutely nothing against intellectuals or experts in any field (or at least most fields). Here’s my position in a nutshell: experts and intellectuals should be utilized in drawing up policy, but the best and most relevant policies are going to occur at the lowest level of government possible. The further out you go, the less effective experts will be, and the more prone they will become to influence by special interests. Everything is magnified at the federal level, including human error. And so, like Sam Smith, I think that big entitlement programs like Medicare and Social Security are best handled federally (and Medicaid would be also), but a lot of public services, such as public education, should remain local. Here’s Smith:

According to Jay Matthews of the Washington Post, the number of elected school boards in America has declined from more than 80,000 in 1950 to less than 14,000 today – all the more stunning because it has happened unnoticed. It’s just so much easier to let Arne Duncan call the shots, especially when he’s willing to pay you for it.

Same for regulatory functions:

As late as 1992, the one hundred largest localities in America pursued an estimated 1,700 environmental crime prosecutions, more than twice the number of such cases brought by the federal government in the previous decade. As Washington was vainly struggling to get a handle on the tobacco industry, 750 communities passed indoor no-smoking laws. And, more recently, we have had the local drives towards relaxing anti-marijuana laws, permitting gay marriage and the major local and state outcry against the Real ID act.

Also see this excellent write-up by progressive financial blogger Mike Konczal on federal preemption of state regulations, and why it’s more difficult to capture 50 different regulatory bodies than it is to capture just one federal agency – and how federal preemption of state regulatory bodies can lead to much more widespread abuse.

Generally when I bring up decentralized regulatory models, people point to the credit card industry as an example of how that goes bad quickly. But this isn’t accurate. Here’s Konczal again, noting that the problem with the credit card industry is not decentralization at all:

This is the result of an (activist?) Supreme Court decision in 1978, Marquette Nat. Bank of Minneapolis v. First of Omaha Service Corp, where the Supreme Court interpreted the word “located” in the National Bank Act of 1863 as meaning the location of the business and not the location of the customer. This creates a big problem – if South Dakota moved to regulate credit card rates in anyway the industries will just move to the next state. All states would have to move together, presumably through Congress, but that would be inefficient – Idaho doesn’t have the same credit markets as Vermont which doesn’t have the same credit markets as Texas.

So why not just update the National Bank Act to go to the original meaning? A credit card company can be situated in South Dakota, but if it is lending to California it has to follow California’s rules. If it is lending to Texas, it has to follow Texas’ rules. This combines local knowledge, federalism while still taking advantage of national credit markets in a powerful way.

Due to a Supreme Court ruling, credit card regulations have become heavily centralized in South Dakota rather than widely decentralized across all fifty states. This needs to change, for obvious reasons, but the regulatory burden should not be handed over to the federal government, where a concerted effort by corporate lobbyists would quickly make federal regulations as weak as South Dakota’s.

This is the sort of thing I’m talking about when I talk about decentralization. Other situations call for centralization – the concept of subsidiarity is not that everything should always be done locally but rather that everything should be done as close to the local level as possible. If a task can be handled by a neighborhood, it should be. It should not be transferred to the town or the county or the state or the federal government. If it can’t be handled at the neighborhood level, can it be handled by the town? If not can it be handled by the county? And so on and so forth. Switzerland is probably the most federalist country in the world, and they’ve managed to scrape together universal healthcare and a number of other impressive policies. Smaller countries tend to be better managed and more democratic than large countries.

There is no magical thinking here, at least no more magical than those who advocate centralized solutions. I believe that diverse, decentralized systems are less prone to catastrophic failure and widespread infection/corruption/etc. Sometimes what is gained in efficiency and uniformity at the national level comes with the loss of more tailored solutions at the local level. Imagine for a moment that one school board oversaw all of our public education – and now imagine it was comprised of the same people who run the Texas school board. Bye-bye Thomas Jefferson; farewell evolution.

And finally, the whole “grad school elite” thing – I didn’t actually write that part, but I take Smith’s point. I don’t like trafficking in that kind of language – it’s too broad and open to interpretation – but I really do think there is an arrogance on display in the efforts of people who want to remake American education from the top down. I’m all for academia and public education and I think a sizable portion of our public monies should go toward funding these things, but I don’t think any amount of knowledge can lead to a really effective bureaucracy overseeing the lives of 300+ million people. The best federal programs are either heavily decentralized themselves, or are basic wealth transfers such as Social Security, or they are efforts by the federal government to force states to adhere to the Constitution (the Civil Rights Act for instance). Subsidiarity and federalism require both central and decentralized authority. The question now is which way are we headed and which way should we be headed on any given number of issues. I’d ask this not just of our political make-up, but also our cultural centralization (in New York and Los Angeles) and our economic centralization (Wall Street). This isn’t a shot at intellectualism at all, but rather a call for humility and realism in our policy-making.