Trickle down economics hurts the working class. Since 2008 it’s been kept alive by an austerity delusion – combined inordinate fear with buoyant optimism – of the rich, the bankers, the mainstream economists and the media rather than reality. The reality is the neoliberal model can only deliver: austerity, stagnation, and increased economic inequality between the rich and the rest of society. When it grows it creates asset bubbles and market collapses, and then with every boom and bust cycle destroys more of the post-war safety nets. The failures of neoliberalism created an angry electorate who voted for change in the 2016 US election. This opens a debate on two alternatives to change: one group proposes the deconstruction of the administrative state; while on the other hand, another group recommends a model of reality – the economy, the energy supply, the ecosystem, public health – be generated from data points of the digital commons.
Steve Bannon is aware that neoliberalism, far from being the midwife of a third industrial revolution, has stifled it. Bannon framed much of Trump’s agenda with the phrase, “deconstruction of the administrative state,” meaning the system of taxes, regulations and trade pacts that the president says have stymied economic growth and infringed upon U.S. sovereignty. Bannon says that the post-World War II political and economic consensus is failing and should be replaced with a system that empowers ordinary people over coastal elites and international institutions. Economic nationalism also supports this agenda. Steve Bannon explains: President Trump’s cabinet picks are aimed at “deconstruction of the administrative state,” meaning weakening regulatory agencies and other bureaucratic entities. However, Bannon’s recommendations for change rely for the most part on the tools of neoliberalism: reduction of government and regulations combined with austerity.
Administrative agencies – the Securities and Exchange Commission, the Federal Communications Commission, the Food and Drug Administration, or the Environmental Protection Agency – were empowered by Congress to formulate federal rules and regulations that carry the force of law. While overseen by Congress along with the president and presidential appointees, today’s administrative agencies effectively possess the power to create and enforce (and sometimes even adjudicate) law – despite being part of the executive (rather than the legislature or judiciary). Koch Industries lobbying spent over $8 million in 2011, much of it on environmental issues. Tim Phillips, the president of Americans for Prosperity, op-ed a piece in the Wall Street Journal identified the EPA’s plans to regulate carbon emissions as “an unconstitutional power grab that will kill millions of jobs unless Congress steps in.” At the end of 2011 Phillips summed up politicians’ skepticism of climate change, “Most of these candidates have figured out that science has become political.”1
Another constitutional matter that features prominently in recent debates about administrative law concerns judicial deference. Federal courts have an established policy of deferring to administrative agencies when interpreting ambiguous statutes. The rationale here is that agencies, staffed as they are with subject matter experts, are more knowledgeable about the relevant issues than the courts. But some conservative critics worry that this trend has simply empowered administrative agencies to take on the judiciary’s constitutional role as well – that of interpreting the law. The federal administrative state hummed along for years, relatively unperturbed until President Donald Trump implemented a freeze on new costs in January 2017. Trump, meanwhile, has made rolling back Obama-era regulations a centerpiece of his administration.
Putting anti-regulation chairs at the top of regulatory bodies is nothing new for conservative administrations – George W. Bush’s EPA administrator Stephen Johnson, for instance, pushed back against staff recommendations and slackened enforcement. As the saying goes, elections have consequences, and lightening the regulatory load on businesses is a pillar of modern Republican doctrine. Interior Secretary Ryan Zinke, for example, was reportedly told by the president that he could hire staff “as long as they’re our people.” Here’s what can happen when you implement this: elimination of a rule that helped prevent oil, gas and coal companies from cheating American taxpayers on royalty payments; a canceled moratorium on a failed coal leasing program that is also cheating taxpayers; a canceled study into the health risks of people living near mountaintop-removal coal mines after rescinding a rule that would have protected their health. If not for the intervention of a US District Court, there would have been a suspension of a methane rule that will save hundreds of millions of dollars, provide energy for American homes and restrict harmful methane emissions.2
In March 2017 there were five-hundred thirty-one key jobs in the Trump administration waiting for Senate approval, according to the Washington Post and the Partnership for Public Service. But just because there isn’t a nominee doesn’t mean that the government offices are ghost towns. Over 400 staffers made the jump from the Trump transition to the Trump administration on January 20th – their roles in the government are eyes and ears of the administration while operating in the shadows. The beachhead team members start out as temporary employees serving for short stints, but many are expected to move into permanent jobs. The administration has been clear about its overarching aim, which it seems determined to carry out: transforming, and in some cases perhaps even deliberately hamstringing, the work of the federal government. Lobbyists representing the economic elite now have considerable power in the new Trump administration.3
Austerity is backed by the belief that too much state spending preceded it. The 2008 financial crisis, caused by a financial sector lending too much, led to bank bailouts that increased the public-sector debt. This led to an outcry about public debt, rather than financial sector mismanagement. Because of all this spending, they claimed it is now necessary to introduce more austerity. The Trump administration has proposed massive cuts to discretionary federal spending. This is what chief strategist Steve Bannon meant when he recently called for the “deconstruction of the administrative state.” The budget would cut programs that provide school lunches for poor kids, that help low-income families heat their homes, that support STEM education. It would slash the funding that provides grants for air pollution control and dozens of other services primarily dedicated to poor people, a clean environment, science and the arts. Bernie Sanders claims the GOP tax proposals to be a massive transfer of wealth from working families, the elderly, children, the sick and poor to the top 1%.
At the same time, the size of the federal workforce is down, from about 2.2 million when Ronald Reagan won re-election in 1984 to about 2 million when Barack Obama won re-election in 2012. Yet the population of the US during this period increased from 236 million in 1984 to around 314 million in 2012. And the size of the federal budget increased from $1.5 trillion to nearly $3.5 trillion. So that means fewer bureaucrats accounting for more money, and serving more people. No wonder people are frustrated with government. Donald F. Kettl observes, “The big challenge that ultimately faces Bannon’s campaign to deconstruct the administrative state… the administration can’t produce less government with fewer bureaucrats – just worse government, one that disappoints citizens even more and wastes far more tax dollars.” Cutting the federal workforce without addressing the statutory obligations and mandates just puts more demand on the remaining employees. This drives a potential downward spiral.4
One irony of Trump’s proposed budget cuts is that they will likely make members of Congress more aware of how much people actually depend on government. By threatening to cut so many programs that working-class Americans rely on, Trump may make many people appreciate all the things government does for them. Members of Congress are going to be hearing a lot more about the programs on the chopping block. Algorithms are now very sophisticated and capable of processing many trends in the community. Presently this is only being used by the politicians and the economic elite to manipulate the system. A digital commons is a discreet online resource that is collaboratively developed and managed by a community. With the use of algorithms and the digital commons, a new route beyond capitalism has emerged. In order to achieve this goal it is necessary to break down the walls of the monopoly that corporations have on the data of individuals.
We need to remove the barriers to abundant information and model current economic reality as ambitiously as climate science models the weather. A climate model is actually a collection of models – typically an atmosphere model, an ocean model, a land model, and a sea ice model. Each component represents a staggering amount of complex, specialized processes. The new economic model of reality involves reconfiguring the administrative state. There would need to be regulation to replace precarious work that is flexible and humane. Universal health care would be part of this new administrative state. Eventually a living wage – a wage that is high enough to maintain a family’s basic needs of living: food, clothes, rental housing, childcare, transportation, and small savings to cover illness and emergencies. In this manner we move forward to create the co-operative, humane sharing society within the niches of capitalism that would replace the broken neoliberal system. The post-neoliberal mode of production would be replaced by a solution that incorporates data from a digital commons to inform the administrative state.5
1 Mayer, Jane. Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right. 2016 Doubleday. pp 276-278
2 Clement, Joel. (13 Oct 2017) Secretary Zinke, it’s time to call it quits http://www.cnn.com/2017/10/12/opinions/zinke-resign-opinion-clement/index.html
3 Ryssak, Kai. (12 April 2017) Trump’s ‘beachhead team’ is the government’s eyes and ears. https://www.marketplace.org/2017/04/12/business/so-many-job-vacancies-whos-running-government
4 Drutman, Lee. (17 March 2017) Deconstructing the Administrative State http://billmoyers.com/story/deconstructing-administrative-state/
5 Mason, Paul. (10 Sept 2015) Neoliberalism is broken… https://medium.com/mosquito-ridge/keynote-speech-solikon-berlin-f0e2caeff8d8