Who is up next? I am. My name is Tax Reform. My friend healthcare already struck out. Budget, debt limit, and immigration will be up in future innings or maybe in future games. I don’t know.
No, government policy is not a
baseball game. But it sure seems like one as policy deliberations and decisions flow
sequentially from one month (inning) to the next.
What other choice is there? While
it seems almost crazy to mention, a better choice is to do it all at once –
simultaneous instead of sequential.
We seem to be focused now on tax
reform. But we are already hearing that you can’t do tax reform until you
settle healthcare. Or you can’t get much accomplished with tax reform until you
settle the budget or change the debt ceiling. It’s all related. Who came first,
the chicken or the egg?
There must be a prize in
government that is awarded to the people who make simple things impossible.
People make budgets all the time. So do companies and churches and drug dealers.
We plan and make budgets because this activity produces better results. Instead
we could wake each morning and make a new decision. It’s Tuesday so maybe I
will buy a TV. It is Wednesday so I might sell some shares of stock. It is
Thursday, and I will get a job and earn some money.
Sound stupid? It should. But this
is the way government works each year. The main reason that sequential
budgeting does not work in government is that each policy affects many aspects
of our lives. A given policy helps Nolan while is hurts Jenny. Of course, Jenny
and her friends scream bloody murder. The next policy helps Jenny but not
Nolan. Nolan organizes his kindergarten buddies, and they throw rotten eggs at guilty politicians. The upshot is that sequential decision making gets nowhere
because EACH decision has a natural resistance.
Better would be a more
simultaneous approach. Let’s take five different areas of policy and find the
best solutions. Policy 1 helps one group. Policy 2 helps another group. Policy
3 might help both groups. If you decide and then announce all five policies at once, it is
harder for resistance to form. For one thing, figuring out the net effects
on people might not be easy when summing up all the pluses and minuses of
all the policies. For another, it might be the truth that most of us
benefit from the whole package, warts and all.
The above is too abstract. Think
next how this might play out in the real world. Good planners begin with a
statement of problems. Once the problems are known they can then think about
the remedies. What are our national problems?
Low labor participation
Low capital spending
Slow economic growth
Unequal distribution of income
High government debt
Inefficient tax system
Too little/too much government
Too much/too little government regulation
Pimples, JD, and other
We can argue about these problems
and their order of importance but it seems possible that a fruitful beginning
step by national policymakers would be to list these problems according to some
definition of priority or importance. Ties are permissible. Just rank them,
Then they would produce a list of
policies that might address one or more of those problems. Such policies would
include tax reform, tax cuts, government spending changes, reforms to
healthcare, immigration policies, and so on.
Assign every policy a positive or
negative number as to how that policy might impact each and every problem
listed. Note that a tax reform policy might help the rich more than the poor in
dollar terms. A government spending policy might do the opposite. Do not try to
make every policy help every problem and every person. Each policy should have
an intended benefit though with side effects.
Summarize the positive and
negative impacts of each policy on each problem area. The first round of this
simultaneous approach will find some policymakers do not approve of the
results. Go back at it and adjust each policy so that the net result of all the
policies is acceptable. No set of policies will make everyone happy. This
approach has a chance of finding a solution that recognizes that not every
policy will make everyone happy but that the sum of all the policies generally
Every major organization works
this way. The board approves a comprehensive plan whose purpose is to best meet
the goals of the organization – be they marketing, finance, or human resources.
They do not go from day-to-day making decisions willy-nilly. Call me a dreamer
for believing that government can be thoughtful and goal focused. But that just
shows how we have come to accept idiotic and failed approaches to our very
important problems and goals. Or maybe, like watching a good fist fight, we
revel in the blood and guts. Government policy is pure entertainment. In that case, we deserve what we get.