Chapter 1

Americans have always been ambivalent about government—distrusting its powers but eager for its services. But something is indeed different today—not the argument but the context in which it is taking place. Citizen distrust of government has been unusually high while voter turnout has been low. Even the rising optimism and satisfaction that accompanied the long economic expansions of the 1980s and the 1990s raised levels of trust only modestly and voter participation not at all.

What underlies this current period of political alienation? Our conclusion is that more Americans than ever do not feel that they own their own government. It is there. They identify with its symbols and believe passionately in its constitutional character. They constantly interact with it as taxpayers and program beneficiaries. But it is not theirs, and this feeling goes far beyond allegiance to political party or candidate.

Three interrelated developments have fueled this loss of ownership.¹ First, Americans feel that government is not responding to their current needs. They find it busy, even meddlesome, but at the same time removed from their current condition and concerns. Second, Americans no longer consider the information they receive from either the media or elected officials reliable. Although they ostensibly live in a society more openly and inclusively democratic than ever before, they sense they are being manipulated, pandered to, and seldom presented with the facts needed to come to their own informed conclusions. Third, for the tenure of most federal legislators and the voting life of most people under 35, it must look as though the federal government's main function is managing the deficit. In fact, the deficit, or surplus, is just what is left after public expenditures are subtracted from public revenues. Making and implementing these spending and tax policies is the main business of government.

Imagine for the sake of argument that there is some new purpose toward which government should turn its attention. The first step must be to ensure that proposed action is realistically tied to the actual economic and family circumstances of Americans. Otherwise there is little chance that resources will be matched to needs even if the resources are available for government to respond. Whether resources are available for the chosen purpose will depend to a large extent upon the level of commitments we have already made. It turns out that our government has made so many commitments—to programs with literally eternal growth rates —that it can do very little that is new without reneging on promises it has already made. This restraint holds even if no deficit is projected for the future based on current law. In other words, we will never be able to rethink our opportunities unless we rethink our commitments at the same time. None of this rethinking, however, gets us very far unless we have a political process that accommodates legitimate expectations for change and reform—some way to build goodwill and trust, to distinguish fact from fiction, need from want, priority from possibility.

Restoring citizen-owned government, therefore, is like rebuilding a three-legged stool. No single leg or pair of legs is enough. The carpentry work will take years, if not decades, requiring much private initiative as well as legislation. Because our current dilemmas of self-government are interdependent, we must develop simultaneously (1) ways to compare relative needs and opportunities, (2) budget flexibility through reasonable limits on growth in prior commitments, and (3) a political process for making informed decisions. Only then will the government we deserve be one we own.

FINDING COMMON GROUND

Before buying into anyone's vision of where public policy should be going, it makes sense for Americans to think seriously about where we are now and about the important conditions that underlie the current debate over the nation's domestic policy choices. The public debate is often unconstructive precisely because people are pushed into debating what paths the country should take without first understanding the common ground that is inevitably our starting point.

Thinking clearly about government's role requires that we understand four major dimensions of our current situation and how we got here. The first two dimensions are very closely related: our economic and family lives. We must consider how well off we are overall, where (and for whom) things are better or worse, and why these particular changes occurred. The third dimension, our government finances, requires that we know what kinds of public promises our government is now bound to keep and how they have evolved. And finally we must determine what kinds of political processes we have as a society for reaching policy choices on what should be done—and how.

The next four chapters address these four dimensions. The patterns we find shape not just the opportunities for public policy action but, equally important, the constraints. Without a sense of history and context, we cannot distinguish unavoidable controversy over realistic alternatives from wasteful fighting over journeys from someplace we have never been to places we can never go.

OUT OF THE SHADOWS

Plato's metaphor for learning about the world is making sense of shadows. Though cast by reality, the shadows are all we can see. To learn and truly understand is to realize the distinction and correct for the distortions. In today's political debate, it is important to gain a realistic picture of the opportunities in our economic and family lives, the policy commitments we have made, and the ability of political processes to help or hinder citizens' choices about what kind of nation this is going to be.

A century ago, Americans were engaged in an analogous debate about difficult choices facing society and government's role in making these choices. Social commentators fell roughly into two camps. Some saw an American whose best days were past now that the frontier had closed. Others saw a triumphal country on the cutting edge of progress.² Truth, it turned out, lay somewhere in between, and describing the middle ground of constraints and opportunities within today's debate is the aim of this book.

At the turn of the twenty-first century, we have immensely greater knowledge about that is happening to ourselves as a people—our economic well-being, our families, our way of life. In 1790, all the Bureau of the Census did was count the population. Today, it provides detailed information on everything from family structure and income levels to how local governments finance infrastructure investment, how companies ship and store their inventories, even how much fertilizer farmers use. The national income and product accounts, which provide continual updates on the quantity of goods and services we produce, date back only to 1929. One prominent measure of the condition of our society, the percentage of people in poverty, was not invented until 1963. Furthermore, this knowledge, once restricted to a small group of government specialists, is now available to anyone with access to the Internet.

While more knowledge can help us understand our world, this incalculable new benefit comes with strings attached. As knowledge accumulates, the synthesis and analysis required to make sense of it become more complex and controversial. Knowing more stimulates more questions and highlights new areas of what we do not yet know. As the easy questions are settled, the unresolved issues come into sharper focus. These often concern not what is happening but why. And "why" questions have a way of becoming contentious and value-charged.

Even with today's much better information about social conditions, so much of our increasing knowledge is prepackaged by the media, politicians, and policy advocates that distortion is inevitable. All selectively filter information. Even ostensibly nonpartisan journalists and analysts can be enticed into playing the recognition game—enjoying greater exposure when they highlight data that support or denigrate some highly publicized claim. It is only human nature, when facing an audience, to "talk to win." But in today's public forum the result of talking to win is growing public suspicion of all claims to inform. It is no wonder opinion polls indicate that nearly half of all Americans think the government manipulates statistics to mislead people.³ In this book we take a different approach. We delineate Americans' common ground before pointing to paths forward, and we provide facts and historic trends in sufficient detail to enhance each reader's ability to choose alternative paths.

Our discussion builds and expands upon several recent analyses. Others have convincingly argued that the early postwar period—with its recent victories over economic depression and fascism, along with unparalleled and unexpected economic growth—engendered unrealistic expectations about what society could do. We take the next step by recognizing how legitimate concerns about economic and family life remain even after we adopt more realistic expectations. Second, a range of studies has demonstrated that the nation's past and projected future deficits reduce national saving and weaken long-term growth. We again take the next step, enlarging the narrow deficit debate into one concerning the extraordinary level of prior government commitments even if the budget is balanced. Finally, by pointing out four key characteristics that mark the landscape of our present-day democracy—inclusiveness, openness, distortion, and manipulation—we build upon research showing how our political processes and media communications can distort decisionmaking. Our aim? To demonstrate that the government citizens deserve requires dealing simultaneously with the economic, family, fiscal, and political changes of our times.

TWO TRAPS

Our approach skirts two traps. One is excessive attention to whether government is too big or too small. In our opinion, a true grasp of specifics always leads to the conclusion that government needs to do more of some things, less of others. And even if we could determine the optimal size of government today, we certainly can't know the optimal size for dealing with the uncertain conditions that future generations will face.

Obsessing about government size can even be a sign of lazy thinking. Working out the details of government programs and making choices require more complex reasoning. Defending government action simply as a means of redistributing more or attacking it simply as a means of taxing less does not get the job done. To be productive, civil discourse requires some depth.

In one sense, government will inevitably grow. Public revenues will grow significantly as long as the economy grows, so that government is likely to do substantially more in the future—regardless of whether it ends up as a smaller or larger share of the overall economy. With good luck, the size of the economy will double in 30 years. With bad luck, the doubling could take 50 years. If government represents a comparatively smaller share in that doubly large economy, its real expenditures will still probably grow by 75 percent or more in real terms; if it occupies a larger share, real expenditures could grow by up to 125 percent. Americans need to be just as concerned about how to allocate that growth—be it 75 percent or 125 percent—as about how large it will be.

The second trap is projecting cultural worries onto government—a national pastime. Society seems especially unsure of its social landscape right now, and many arguments about government are projections of broader worries about life and culture—of who we think we are as a people and what we think we owe others and are owed by them. According to many measures of well-being—life span, income, consumption, years of schooling, foreign threats, and the like—Americans have never had it so good. But not all groups in our society are sharing in these good times. And opinion researchers of all political stripes describe a public deeply concerned that much of life seems on the wrong track and out of control. The worries apply not only to such conventional political issues as taxing and spending but also to values and family life, the culture to which children are exposed, work, and the future itself.

With such "policy problems" as welfare, education, budgets, health care, and many others frequently used as metaphors to cover deeper cultural worries, it's tempting to think that culture and government are the same thing. But they aren't, and there are some problems that no government official or public policy can fix.

Once liberated from the idea that everything preying on the public mind requires government to do or stop doing something, Americans can get a better sense of the lay of the land for domestic policymaking and see some practical steps for moving forward.

OUR PROPOSALS FOR ACTION

The economic, family, fiscal, and political dimensions laid out in The Government We Deserve demand a set of responses that add up to a major agenda for changing the face of American policy and politics in the twenty-first century. The eight pathways that fall out of our analysis, while certainly not defining the entire public agenda, would take domestic policy in a direction decidedly different from where it has been heading for the past several decades. This choice of paths abandons prior practices that were neither dynamic nor adaptable to continually emerging circumstances and needs. While few readers will agree with every detail and many may disagree with the major components, we hope most people will concur that only a comprehensive approach unblocks paths for restoring government ownership to its citizens.

1. Free our fiscal future. We must create some fiscal slack in our budgets, so current and future generations have the requisite flexibility to decide what the most important needs of their time are. We must also free our elected representatives from a position in which nothing new can be done without essentially reneging on past promises to the public or constantly raising tax rates on future generations. At its core, this goal requires constraining the automatic growth in programs and reducing the competitive disadvantage that new programs and discretionary programs now face in the legislative process.

2. Give social insurance a modern face. Much of the growth in government expenditures derives from a historical and partially outmoded design of social insurance. Retirement and health policies, in particular, have large built-in growth due to insurance models that are decades old. A modern face means going beyond a simple budget focus to a comprehensive assessment of the relative priority of different programs for Americans collectively. It also requires paying more atention to the responsibilities of those who reap the benefits of social insurance.

3. Make a government for all ages. Our retirement and health programs are scheduled to increase lifetime benefits in constant terms by several hundred thousand dollars for the typical baby boom couple—and even more for later generations. That's on top of the half a million dollars promised to an average-income couple retiring today. A government for all ages would put this policy into the context of our other social needs, including education and opportunities for accumulating wealth, especially for those who have little net financial worth. It would also redirect retirement policy toward the elderly with the greatest needs—such as the very old, who are typically much poorer than the near-elderly and young elderly. It would ask each of us to look less myoptically at benefits for people of our own current age and more at how public programs might best serve each citizen over a lifetime.

4. Increase everyone's chances to build financial security. Opportunity is crucial to creating the government we deserve. Americans believe that all individuals deserve a chance to improve themselves, support their families, and partake in society's gains. This book does not tackle issues of class, race, or gender directly—though it does identify those who are falling behind. It suggests several means of moving through and beyond those issues. One is by creating opportunities to accumulate assets for financial security, especially among those facing the greatest disadvantages. In this way society can give everyone a greater stake in the future and the common good. Much of twentieth century social policy, ranging from welfare to social security, created a safety net by redistributing income. Without abandoning those redistributive aims, we must recognize the limits to this approach and how it can reduce incentives to create wealth. We should look to the twenty-first century as a time to move beyond simple redistributive policy toward "cumulative" policy. The aim is to strike a new kind of balance between security and opportunity.

5. Stress learning over a lifetime. Even more important than creating financial wealth is creating human capital through education. Lifetime learning is a key to developing and maintaining the human capital vital in a technological and service-oriented economy that so richly rewards both knowledge and education. We argue not just for extending educational opportunities but for improving education at all stages of life, from early childhood through our elderly years.

6. Occupy our children more fully in settings with adult or parental supervision,guidance, and mentoring. Because of many changes in family life, including large growth in single-parent families and two-earner couples, children are increasingly left on their own during after-school hours and summer breaks. Statistics tell us our children are most likely to get in trouble or simply to direct their activities poorly during these times. Research also shows that children's relationships with adults are essential for their healthy development. Yet, government programs—geared to provide between one-half and one million dollars in retirement and health benefits to today's couples when they retire—continue to neglect the fundamental need of each child for adult stimulus and supervision.

7. Support the modern family. Many government tax and expenditure policies are built around stereotypes that do not fit modern families. The policies born of these stereotypes are neither equitable nor efficient, and they often contradict important values in society. Government now punishes low-income individuals by reducing their combined incomes by as much as 30 percent simply because they marry, for example. It also heavily penalizes secondary workers, usually women, so that a married couple with two earners receives substantially fewer social security benefits than a one-earner couple who contributes no more taxes to the system.

8. Foster a new democratic citizenship. As agonizing politically as it might be to move down any of the paths we have outlined, most are at least amenable to legislative action. Capping automatic growth rates in programs, for instance, may be difficult in the context of special interest lobbying, but many of the steps required are fairly obvious. Revitalizing citizenship, in contrast, depends more than anything else upon each of us as citizens trying to do the right thing to build trust in our civic life. Doing so requires improving media communication, nourishing deliberative and thoughtful public opinion (including polling), and supporting institutions that encourage responsible journalism and civic education. Resources from private individuals and nonprofit organizations are crucial to building and maintaining momentum. And the path will be long. The erosion of public trust took many years, and the process of rebuilding it will, too.

While writing this book, we talked with many concerned citizens, policy analysts, and foundation officials deeply concerned about the poor, children, education, welfare, urban problems, crime, health care, or high tax rates. Many came to agree that government cannot do much on any of these counts—or a host of other pressing issues—if each is considered in isolation. Instead, real headway can come only from understanding how needs and demands are changing in the economy and family life, how prior public commitments now tie up most new government resources, and how political processes can be manipulated to deter citizens from making realistic trade-offs among competing needs. We hope to persuade you to reach the same conclusion.

1. In his own, parallel, analysis of public distrust, Bill Galston argues that the level of public discontent in this country is higher than in the past because, "in the eyes of the American people, the federal government wastes money. It tries to do too much, including things that it has no business doing. And, as a result, it has a diminished capacity to solve problems. At crucial junctures it doesn't tell the truth. It doesn't care enough about average citizens." Based on a presentation by Bill Galston at a conference at the University of Virginia called "Democracy on Trial," September 26-28, 1996.

2. H.W. Brands, 1995, The Reckless Decade: America in the 1890s.