Daily Archives: April 14, 2013

With last week’s release of the president’s budget, Washington has once again descended into partisan squabbling. In the US today, there is pervasive concern about the basic functioning of democracy. Congress is viewed less favourably than ever before in the history of opinion polling. There is widespread revulsion at political figures seemingly unable to reach agreement on measures to reduce future budget deficits. Pundits and politicians alike condemn “gridlock”. Angry movements, such as Occupy Wall Street and the Tea Party, are present and still active on the extremes of both sides of the political spectrum.

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Meanwhile, profound changes are redefining the global order. Emerging economies, led by China, are converging towards the west. Beyond the current economic downturn lies the even more serious challenge of the rise of technologies, which may raise average productivity but will displace large numbers of workers. Public debt is increasing in a way that is without precedent except in times of total war. A combination of an ageing population and the rising prices of health and education will put pressure on future budgets.

Anyone who has worked in a political position in Washington has had ample experience with great frustration. Almost everyone in US politics feels there is much that is essential yet unfeasible in the current environment. Many yearn for a return to an imagined era when centrists in both parties negotiated bipartisan compromises that moved the country forward. Yet fears about the functioning of the US government have been a recurring feature of the political landscape since Virginian Patrick Henry’s 1791 assertion that the spirit of the revolution had been lost.

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Lawrence Summers

It is sobering to contrast today’s concern about political paralysis with that which gripped Washington during the early 1960s. Then, the prevailing diagnosis was that a lack of cohesive and responsible parties for voters to choose from precluded the clear electoral mandates necessary for decisive action. While there was a flurry of legislation passed in the 1964-66 period after a Democratic electoral landslide, Vietnam and Watergate followed, all leading to President Jimmy Carter’s declaration of a crisis of the national spirit. Despite the rose-tinted view today, there was hardly high rapport in Washington during Ronald Reagan’s presidency. During his time in office Bill Clinton worked hard at compromising with a US Congress controlled by Republicans, only to be impeached by the House of Representatives.

Throughout American history, division and slow change have been the norm rather than the exception. While often frustrating, this has not always been a bad thing.

There were probably too few checks and balances as the US entered the Vietnam and Iraq wars. There should have been more checks and balances in place before the huge tax cuts of 1981, 2001 and 2003, or to avert the many unfunded entitlement expansions of the past few decades. Most experts would agree that it is a good thing that politics thwarted the effort to establish a guaranteed annual income in the late 1960s and early 1970s and the effort to put in place a “single-payer” healthcare system during the 1970s.

The great mistake of the gridlock theorists is to suppose that all progress comes from legislation and that more legislation consistently represents more progress. While these are seen as years of gridlock, consider what has happened in the past five years.

The US moved faster to contain a systemic financial crisis than any country facing such an episode has done in the past generation. Through all the fractiousness, enough change has taken place that without further policy action, the ratio of debt to gross domestic product is expected to decline for the next five years. Beyond that, the outlook depends largely on healthcare costs – but their growth has slowed to the rate of GDP growth for three years now – the first such slowdown in half a century. At last, universal healthcare has been passed and is now being implemented. Within a decade it is likely that the US will no longer be a net importer of fossil fuels. Financial regulation is not in a fully satisfactory place but has received its most substantial overhaul in 75 years. Most schools and teachers are for the first time evaluated on objective metrics of performance. Gay marriage has become widely accepted across the states.

No comparable list can be put forth for Japan or countries in western Europe. Yes, change comes rapidly to some of the authoritarian societies of Asia. But it may not endure and may not always be for the better.

Anyone prone to pessimism about the US would do well to ponder the alarm with which it viewed the Soviet Union after it launched the Sputnik satellite or Japan’s economic rise in the 1980s and the early 1990s. One of America’s greatest strengths is its ability to defy its own prophecies of doom.

None of this is to say that the US does not face huge challenges. But these are not due to structural obstacles. They are about finding solutions to problems such as rising inequality and climate change – where we do not quite know the way forward. This is not a problem of gridlock – it is a problem of vision.

The writer is Charles W. Eliot university professor at Harvard and a former US Treasury secretary

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