Regulatory Tyranny Makes Both the Private and Public Sector Inefficient

America needs Hamilton, not DOGE, to build state capacity and deliver necessary public goods

The UnPopulist illustration

As we suffer through the DOGE attack on the American government, we are being made all too aware of the right-wing critique of the “deep state.” This critique has been around since the 1930s, and was re-inserted into the culture by Ronald Reagan in 1986 when he said, “the nine most terrifying words in the English language are ‘I’m from the government and I’m here to help.’” It has been vastly amplified by Donald Trump and echoed now by Elon Musk: according to them, we are being ruled by “unelected bureaucrats” who have escaped the control of democratically-elected leaders and are implementing a left-wing agenda.

The attack on the federal bureaucracy was not, however, a fever dream that came only from conservatives. I’ve been reading two books recently that note how progressives have also contributed to the de-legitimization of the American state. The first is Marc Dunkelman’s Why Nothing Works, and the second is Paul Sabin’s Public Citizens. As we consider how to repair the damage wrought by the Trump administration, these books provide a framework for a future progressive agenda.

New Deal’s Hamiltonianism

Dunkelman distinguishes between two poles in progressive thought: a “Jeffersonian” strand that sees democracy’s biggest challenge as the protection of individuals from an overweening and potentially tyrannical state, and a “Hamiltonian” current that sees centralized government as a driving motor of progressive change. He notes that both strands have co-existed in the minds of progressives over the years, but that their relative weights have shifted in cycles. The Jeffersonian strand was dominant through most of the 19th century, until the requirements of a rapidly modernizing industrial economy spawned the Progressive Era late in the century and laid the groundwork for the administrative state. Peak Hamiltonianism occurred under the New Deal and during World War II, when the American government oversaw recovery from the Great Depression, laid the foundations of the American welfare state, and managed a successful war effort against Germany and Japan.

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Trump’s Indiscriminate Destruction of State Capacity Will Lead to a Dysfunctional, Not Cheaper, Government

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The Jeffersonian strand began to reassert itself in the 1960s, however, when trust in government began to erode among many on the left. It is here that Sabin’s book provides critical background, and focuses on Ralph Nader and the rise of his group Public Citizen. Nader charged that the big regulatory agencies created by the New Deal had been captured by corporate interests and were colluding with big business at the expense of ordinary Americans. This began with charges against the auto industry laid out in his 1965 book Unsafe at Any Speed and continued through a series of exposés of other corporate sectors written by his young followers. Their primary weapon was the law, and from that day to the present idealistic young progressives tend to go into legal careers and launch lawsuits against both federal agencies and large corporations.

The Jeffersonian turn was a necessary corrective since there was indeed regulatory capture and abuses by big government. This shift is best illustrated by the book with which Dunkelman begins his work, Robert Caro’s 1974 biography of Robert Moses, The Power Broker. Robert Moses was the New York City official who, for several decades, oversaw the transformation of the city through massive infrastructure projects—projects that included the Cross Bronx Expressway, the UN Plaza, Jones Beach, and dozens of other parks, pools, and playgrounds. Moses’ authority was such that entire neighborhoods were bulldozed and citizens displaced with little recourse, and the costs of this re-development fell largely on marginalized Black and brown communities who often failed to benefit from the new infrastructure. I remember vividly when my father, a committed liberal, first read The Power Broker in the 1970s. He was utterly outraged at the injustices portrayed in the book, as were many other progressives at the time.

Jefferson Pushes Back

This brings us to the present, where the wheel has turned 180 degrees in the direction of Jeffersonianism. The kinds of government abuses documented by people like Nader and Caro are far more constrained today; it is inconceivable that New York could undertake projects of a similar scale. Indeed, the city doesn’t seem to be able to build anything at all: Dunkelman chronicles the prolonged efforts to rebuild Penn Station (which hasn’t occurred) or the little Wollman Rink in Central Park (which had to be carried out by a private company when public authorities failed). The Second Avenue subway was started in 1972; while the first three stations were finally opened in 2017, the entire line’s completion lies years in the future. The inability to build things is not unique to New York; I have documented extensively how and why infrastructure projects fail in my own state of California.

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Democrats are Losing Because they Give Not a Fig About Governing, Only Virtue Signaling

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At the moment, everyone worried about what the Trump administration is doing to America is focused on constraining executive power. This is absolutely the right emphasis now: Trump is an authoritarian who aspires to be a king who can run the United States through executive orders. Our checks and balances need to be preserved and strengthened.

But there is a good chance that the Trump project will ultimately fail, and opportunities to rebuild the American government will emerge. Indeed, the only way that Trumpism can be displaced is for his opponents to offer something better. The opposition will have to shift from stopping abuses of power, to putting forward a positive program for the future. I fail to see any such program being articulated by the Democrats at the moment. But if they could remember the Hamiltonian side of progressivism, there is an agenda waiting for them to take up, which has to do with building things.

This was exactly the turn that the government took during the first half of the 20th century. In that period, the United States built the Hoover Dam, the Golden Gate Bridge, and the Oakland Bay Bridge in a period of five years. Progressives were imbued with a sense that government could be a force for good, and that they needed to deploy power to do things like electrify the Tennessee Valley.

Regulatory Overreach

A future progressive agenda centering once again on building things would require two big accompanying reforms, however. The first is permitting reform. Over the years the United States has accumulated multiple layers of rules that slow down projects and make them vastly more expensive. This is a byproduct of national laws like NEPA (the National Environmental Protection Agency Act) and state-level rules like California’s CEQA (the California Environmental Quality Act, about which I’ve written previously). The Biden administration did indeed try to build things, through legislation like the big infrastructure bill and the CHIPS Act to promote semiconductor manufacturing. Because permitting reform wasn’t put front and center, however, initiatives like the TSMC fab in Arizona have been very slow to get off the ground.

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Neither Trump Nor Democrats Care About American Prosperity

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The second thing that a future progressive administration needs to do is a true reform of the public sector as a whole. The current DOGE effort is a tragic joke and is doing the exact opposite of what is needed, arbitrarily firing bureaucrats with no understanding of what it is they actually do. Americans will quickly come to learn how important their government is. Rather than firing people, the United States desperately needs to build capacity and fill pipelines of (especially) younger tech-savvy talent. But it also needs to de-regulate the bureaucracy itself. American civil servants operate under years—indeed, generations—of detailed rules constraining their behavior, and are told to prioritize compliance with these rules rather than achieving concrete results for citizens. Bureaucrats need more authority to do their jobs properly, not less, and to substitute good judgment for detailed rule-following.

None of this will happen unless there is a shift away from the entrenched Jeffersonian mindset of many progressives. Dunkelman notes that most progressives have a vestigial memory of Hamiltonian respect for state power. We don’t want to return to Robert Moses-style disregard for citizen rights and public participation, but we can change the degree to which our current procedures inhibit collective action. We need to get public comments on proposed projects, but we do not need 50 town hall meetings before we can proceed on a single building project, as occurred in San Francisco.

There is a clear, positive progressive agenda waiting to be picked up and implemented. Since the Trump administration does not want to take up Hamilton’s legacy of good, competent, effective, uncorrupt government, the other side should claim it as their own.

This essay originally appeared in the “Frankly Fukuyama” section in American Purpose at Persuasion. To sign up for Francis Fukuyama’s column and other content from the American Purpose family at Persuasion, click here.

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