One Size Does Not Fit All

Be still my beating heart. I hope this op-ed by Lawrence Summers in the Washington Post will be taken to heart:

Economists like me see the world through the prism of models, fit to statistical data and tested against market realities. Economic models provide powerful perspective: I have used them to argue that, had the economy been left to itself and policymakers not heeded the lessons of history and theory, the 2008 financial crisis might have led to another depression.

But there are other ways of gaining understanding about an economy and its workers. This was brought home to me last month when I accompanied my wife on a trip different from any I had ever taken. We drove for two weeks on two-lane roads from Chicago to Portland, Ore., across the Great Plains and Rocky Mountains. The larger cities we passed through included Dubuque, Iowa; Cody, Wyo.; and Bozeman, Mont.

Driving across America, as opposed to looking down from a plane, makes clear how much of this vast country is uninhabited. Again and again, we encountered signs warning us to check our gas because it would be 50 miles to the next station. I’m sure there were moments when we were 250 miles from any place where I could have purchased an iPhone charger. Often there was no cellphone service to be had, either.

Read the whole thing. I can only hope that these experiences are reflected in Dr. Summers’s policy thought.

I’ve written before of trips of that sort. I think they should be compulsory for those seeking higher office or appointments of the sort that Dr. Summers has held. I also think they would be useful foreign policy tools, more useful than treating foreign dignitaries to tours of the fleshpots of New York and Washington, DC. If we’re going to continue to host the United Nations, why not move the location of its meeting place to Topeka?

I also hope that we’re seeing a resurgence of federalism. The United States is an extremely large, extremely diverse country. Policies that make sense in California or New York may not make any sense in Lexington, Kentucky or Tulsa, Oklahoma and simply dismissing those places as unimportant or, worse, deplorable is just an argument for devolution.

19 comments… add one
  • Guarneri

    I can’t imagine that traveling to all those Nowheresville towns in search of small manufacturer investment opportunities, staying in the local Hampton Inn, and then turning around and papering them on the 50th floor of some Midtown glass tower with the likes of a Simpson Thatcher hasn’t affected my worldview.

  • That actually brings tears to my eyes. The U. S. is incredibly different from practically every European country. In the U. S. when you drive into a small town you find a seat of government, churches, and a shopping area. On the outskirts is generally farming, light manufacturing, and, frequently, an institution of higher learning. In our zeal to centralize we’re actually throwing away our competitive advantages.

  • steve

    Uhhh, I work in some of those areas. Grew up in those areas. We bought a house for our staff to live in at one of our hospitals because there were no hotels or motels within a 30 minute drive. Bought the house, a good one by local standards for $45,000 because housing is dirt cheap, and we probably overpaid even then. Still, I am not exactly sure what policies you are referring to that make sense in California that won’t in coal country PA or farm country Indiana. At least not ones that are currently controlled by federal policy. Trust me, there are tons of local and state laws and policies already and they seem to address local differences. They also seem just as corrupt and inept and often more harmful than federal laws.

    Some of that is the influence of money. I dont know about Illinois, but it is amazing how little money it takes to influence elections at the state level. Our local state rep runs his campaign (2016 numbers) on a budget of about $35,000. Also, surely you realize the irony of your writing about Illinois as you do while extolling the wonders of federalism.

    (Just as an aside, small towns are actually quite different in many areas. The small towns in coal country are so much different than those in farm country. They are long and narrow as a rule as they were built to follow the coal seams. You also forgot to mention the bars, usually away from the churches somewhere.)

    Steve

  • In Wisconsin even the tiniest towns have bars and nearly every bar includes a few lanes of bowling.

  • I don’t object to California having its own laws and doing whatever the people of California care to within its borders. I object to trying to federalize those laws. Heck, I object to Texas trying to federalize its laws.

    Over the last couple of decades the federal government has dumped trillions of dollars on New York City. Imagine what might have done if more of that money had been spread around rather than concentrating it as has been done. It’s no accident that the coasts and the areas surrounding state capitols have recovered the most since the 2008 recession.

  • Guarneri

    I guess the “tears in eyes” is a reference to the significant dichotomy of city and country here. Yet London is hardly Birmingham or the English countryside.

    In any event, I’ve always thought my experience keeps me grounded. Raised in the decidedly middle class east side of Indianapolis (the money was always north side), schooled in Lafayette, worked early in Da Region, with Da Region people. Further, our companies invariably are located outside of major metro areas, not in them. We aren’t like the PE stereotype. No private planes. No fancy hotels. No exotic restaurants. That only happens when we are with our lawyers, accountants and bankers. (When I was with the bank I stayed in the Peninsula in my primary calling area – NYC. Every time. Same type of thing in Boston.) However, its just a fact; you are not going to get the high powered M&A investor, accounting and legal etc talent we use in rural areas. But give me the owners, managers and majority of workers in those non-urban areas any day. Kankakee came up in discussion a few days ago. That’s the type of place we find opportunities, not LaSalle Street or Midtown.

  • Guarneri

    I’m not sure what your point is, steve. I read Summer’s piece as a commentary on perspective and values. If memory serves, you grew up more or less in the Ft Wayne area. A person living there simply isn’t going to see the world as someone from Carmel, IN, much less Greenwich, CT, San Francisco or the upper west side.

  • Andy

    Steve,

    I think the point is that many of our elites don’t understand what goes on outside of their narrow bubbles. The fact they are surprised there isn’t a gas station on every corner is amusing but also indicates a pretty big blind spot when it comes to a large portion of the country. I’m glad Larry got out of his bubble, even for a bit, to see how the other half lives, but I think it’s pretty clear most of his contemporaries aren’t aware of and don’t understand the less-paved parts of the country. I’ve certainly seen it myself many times when talking to urbanites.

  • Ben Wolf

    steve,

    It would depend on what Dave means by federalism. If it is simply tranferring power to state capitals then I agree with you that will not improve our situation and may make it worse, with fifty little tyrannies rather than a single big one.

  • Generally, I use “federalism” as shorthand for subsidiarity, the principle of devolving decisions and authority to the lowest practical level.

  • steve

    Drew- Southern Indiana, mostly Columbus, with some time in Trafalgar and also Southwest of Greenwood. We also lived in rural Wisconsin for about 4 years. My point is that while it is actually very good to appreciate what life is like in the rest of the world (and if you really ever lived in rural areas then you know that they have little idea of what life is really like in the cities), I am not sure that would necessarily lead to major policy changes.

    Dave- You dont need federalism to stop bailing out NYC. So how many people here have gone to a school board meeting? Gone to their state capital to talk state legislators about bills in which they are interested? Gone to their local city council or supervisors meeting? I would predict that we would end up with 50 little tyrannies, not that much different than what we have now. But maybe PA is exceptionally bad. I am sure it would be better in Illinois.

    Steve

  • So how many people here have gone to a school board meeting? Gone to their state capital to talk state legislators about bills in which they are interested? Gone to their local city council or supervisors meeting?

    I’ve done all of those things. I’ve also had contracts with city, county, state, and federal governments.

    However, aren’t you actually criticizing non-deTocquevillean America?

    My point is that far too much is federalized now and that infantilizes local government. Perhaps it’s not something you can appreciate if you haven’t worked closely with state government. An enormous amount is based on federal grants, working within federal restrictions, with largely fictitious oversight.

  • Ben Wolf

    Dave, I sometimes think you’re a Jacksonian and sometimes a Jeffersonian with mutualist-anarchist leanings. I suppose it’s possible to be both.

  • Andy

    In my experience, pretty much every level of governance is focused pretty heavily on getting federal dollars. And that’s the way the feds work – the federal government doesn’t have the authority to legally enforce many of the mandates in law, so they use money as leverage.

    I went to the HOA meeting for my new neighborhood last week. Apparently, there was a flood in 2013 that caused some damage and silted up the flood control holding ponds. Since then, the HOA has been trying to get a federal FEMA grant. Last year they finally got it, but the grant expired because the EPA permitting took too long and the grant expired. The cost isn’t that great to get the work done – about $100 per house in the HOA. But people would rather chase the “free” federal money. Five years later they finally decided to just pay for it and make a special assessment on the homeowners.

    States, counties, cities, and localities are all doing the same thing for everything they can. It perverts incentives.

  • Guarneri

    e”…I sometimes think you’re a Jacksonian and sometimes a Jeffersonian with mutualist-anarchist leanings. I suppose it’s possible to be both.”

    Practically the whole political history and debate in the country derives from the fact that the philosophies, current realities and people cannot be conveniently placed neatly into discreet boxes.

  • These are tendencies not interest groups. The Jeffersonian view has much in common with the Jacksonian in that both are pessimistic (Jeffersonians are pessimistic idealists and Jacksonians are pessimistic realists), particularly about foreign relations.

  • steve

    “My point is that far too much is federalized now and that infantilizes local government.”

    OK, that is a fair point. However I also see that as the natural outcome of our extreme polarization. The parties are now in charge. Our system was set up with (my interpretation) the idea that the states would jealously fight for their own rights and policies. That the House and Senate would balance each other. That they would balance against the executive branch. The Courts would balance against the other two. So and so forth. Instead, party affiliation and ideology trump everything. My concern is that at the local level, and the state level, that we no longer have the means or will to do the innovation we need to change, and that the level of integrity at the local level is as low or lower than the federal.

    Steve

  • The parties are now in charge. Our system was set up with (my interpretation) the idea that the states would jealously fight for their own rights and policies.

    Which is why the 17th amendment was such a bad idea.

  • steve

    No. we got the 17th because the election of Senators before it was passed was incredibly corrupt done in secret by party operatives. The popular vote at least had the chance of being better. I am not going to make the case it ended up being better, but it isn’t any worse. Dont think it matters that much.

    Steve

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