Larry Summers on why we shouldn’t worry about gridlock

April 19, 2013

It won’t shock longtime readers that I’m in a rather continuous state of dismay over the workings of the modern Congress. Larry Summers, the famed economist and former director of the National Economics Council, is calmer. In a recent article, he argued that the problems of gridlock are substantially overstated. We spoke Monday evening, and a lightly edited transcript of our conversation follows.

Larry Summers. (Brendan Smialowski/Bloomberg)
Larry Summers. (Brendan Smialowski/Bloomberg)

Ezra Klein: Walk me through your argument. Why aren’t you worried about gridlock?

Larry Summers: First, frustration with the working of the system is more the norm than the exception, historically. Second, the slowing down of things is actually valuable. Third, if you take a view of more than a few months, the system over the last four years has been quite productive in producing significant legislation. There’s plenty of disagreement about whether we pursued the right policies in various areas and there’s questions about the effectiveness with which policies have been implemented. But if you ask whether the country has made consequential choices over the last four years, it’s made more than in most four year periods.

That’s true. But the reason for most of the choices you’re referring to —  universal health care, Dodd-Frank — was because 2009 and 2010 saw a generationally rare majority for the Democrats. For a time, they had the 60 votes necessary to break Republican filibusters in the Senate. If that’s the argument for the system working, then doesn’t it imply that the barriers in normal times are simply too high?

It’s probably appropriate that when there is a very clear electoral signal about which way the country should move that we move further and faster. Anyone who works in Washington and the political process is frustrated, and I share that frustration. But I think the problems are the problems more than the process is the problem. Between gridlock being the fundamental diagnosis of what’s wrong and the difficulty of problems like controlling the growth in health-care costs, finding solutions to global climate change, and dealing with the nexus of changing technology, inequality and jobs, I’d take the problems.

There are two views one can take. One is that it used to be that we had lots of progress normally even with divided government. The other is that America has always been a country with too sluggish a government. I think it’s hard to look at the broad run of history in the United States in comparison with other countries and say we’ve always had too sluggish a government.

But these broad-sweep-of-history arguments elide the fact that we’ve routinely altered the working of the U.S. government in order to deal with the very real problems that were motivating the critics. We took the filibuster from being unbreakable to stoppable with a two-thirds vote and then with a three-fifths vote. We took senators from being appointed by state legislatures to being directly elected. House Speaker Sam Rayburn says the hardest fight he ever had was expanding the House Rules Committee so they couldn’t pocket veto civil rights legislation. I worry people take a false sense of comfort from our past because they forget the wars that were fought to make the government work better.

That’s a fair issue to raise. I guess I’d say a couple of things. Look at legislation produced between 1952 and the assassination of President John F. Kennedy. You have the interstate highway system. That was a big thing. You have the Civil Rights Act of 1957, which was weak, but got an important process started. And you have a space program, But not much. And that’s over a pretty long time period with a fairly popular president. And so if you use the standard of legislation produced you get a different conclusion.

I’m sure it’s a good thing we reduced filibuster from 66 to 60. But what would be examples of legislation passed because of it? And are we sure that the reduction in the vote threshold wasn’t a contributor to the normalization of the filibuster? So it’s not even clear that the effect of that process change was the one its advocates intended. And today, the aspect of congressional performance that is most opposed, which is their work on the budget, is actually insulated from the filibuster because it can go through budget reconciliation.

You write in the piece that most scholars agree it’s a good thing we didn’t pass single-payer health care in the '60s and '70s. That seems to me to be exactly the sort of real cost that accrues to our sluggish system. If you look at other countries, the fact that they moved to national health-care systems much earlier than we did has helped them keep their costs much lower. When I look at what we pay versus what everyone else pays, I think the fact that we didn’t get some kind of national system in place decades ago is a huge failure.

There are cost problems in American health care and favorable quality issues in American health care. I don’t think it’s clear at all that the nation would’ve been better served by passing the kinds of universal health care bills that were fashionable in the 1970s. I think there is at least a real possibility they would not have contributed to the control of costs —  after all Medicare has not been hugely successful at that — and I think there are real differences in the cultures of physicians in the United States.

Of course my sympathies lie on the progressive side. In periods of conservative rule, a variety of things might have passed if we’d not had stronger safeguards. There was a substantial negative income tax in the late '60s and '70s. That would’ve been the opposite direction of welfare reform. The government would’ve sent you money, no questions asked. And that was supported by everyone from Milton Friedman to James Tobin. So I don’t mean to say that there was nothing that’s happened too slowly. But I think the challenge is to make the case that the defects and the problems that frustrate people lie mostly in the process. of the many of the phenomena that are of concern, perhaps the the most concerning is the declining faith in institutions, in governments, and that’s fairly ubiquitous around the developed world. And that should incline one away from America-specific explanations.

I think that’s fair. But my overall worry is that the American system, properly, is designed to make swift action difficult. We already have more veto points than anyone else. That design, however, didn’t account for political parties, much less polarized ones. It didn’t foresee the filibuster. It didn’t imagine cable news channels and radical levels of transparency that permit party activists to exert a much higher everyday level of pressure on representatives. It didn’t imagine today’s money chase. You put all of it together and I think the bias against action might have swung too far toward paralysis. That’s not to say we need to totally overhaul the system, but it is to say we might want ratchet back the new veto points we’ve imposed in recent years.

It’s certainly possible that reasonable observers will look back in 2020 or 2025 and conclude that your fears were totally grounded and my optimism was ungrounded. On the other hand, the period from 2009 through 2010 was the period of the most legislative action in 30-some years at least. Perhaps even in 60 years. And this year there’s a very good chance that there will be substantial action on immigration.

With all the struggling, measures are being taken. Probably not the ones I’d prefer or that anyone else would prefer, but measures that do have the debt-to-GDP ratio being reduced over the next several years, and somehow, health-care cost growth seems to be slowing. There are undoubtedly periods of too little action, but we had, from my perspective, substantially too much action on tax cuts and unpaid-for wars and unpaid-for entitlement expansions in the early Bush years.

So all of us would prefer fewer barriers to action when our side is riding high and more barriers to action when the other side is riding high. The question is, on balance, is it clear that we need fewer barriers to action? It may be that people will look back 10 years from now and say it is, but on the strength of two gridlocked years after two whirlwind years, I think that case is a long way from proven.

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