THE BLOG
01/05/2015 05:09 pm ET Updated Mar 07, 2015

Will It Be As Always?

Thomas B. Reed, a Republican politician and Speaker of the House at the end of the 19th century, warned: "One of the greatest delusions in the world is the hope that the evils in this world are to be cured by legislation." For more than 100 years since then, Americans not only ignored this warning but have been doing exactly the opposite -- they went into a legislative binge.

Prohibition was the first big failure proving that excessive legislation leads to common disrespect for the law in general, breeds corruption and spurs organized crime. Following this blunder, Americans were reluctant about legislating other similarly grandiose policies on the national level. Besides a few exceptions, such as the set of the Great Society acts voted in about 50 years ago during the Lyndon Johnson administration and, more recently, the Affordable Care Act, most of the legislative binge went into small regulations here and there, on all levels -- federal, state and local. As a result, Americans are ensnared in a network of ubiquitous petty regulations -- well-intended, but effectively hindering entrepreneurship -- thus thwarting our economy, which under these conditions cannot create the well-paying jobs that Americans need. At least this is the mantra propagated by many Republicans.

It sounded convincing to Americans during the last November midterm elections; Republicans gained a majority in the Senate and increased their majority in the House. In Illinois -- where I live - a reform-minded Republican was elected as the new state governor. It will be interesting to observe how -- starting in January -- Republicans will go about reversing the legislative binge. Or, will they?

One can make a reasonable assumption that among thousands (if not millions, when we include all local ordinances) of legislative acts there is a sizable number of those which -- similar to Prohibition -- were well-intended, and similarly have been causing more harm than good. So far, every time when a problem is identified, legislators go to work and produce new laws intended to fix it. Knowing that at least some of our problems are caused by previous regulations, should we expect that, beginning in January, when recognizing a problem, before even thinking about proposing a new regulation, Republican legislators will examine the existing laws first? Will they look into the option of fixing the problem not by introducing a new law but by eliminating the existing one and leaving nothing in its place? Now, as their achievements, legislators list the laws they helped to pass. Starting in January, will they list as their achievements the laws that they eliminated and in place of which they left nothing?

Is the new wave of Republicans serious about achieving more by legislating less? Are they ready to seek solutions by eliminating or scaling down existing regulations? Are they set to resolve our problems by shrinking or even eliminating government agencies, not by expanding them or creating new ones?

Occasionally, one may get an impression that this is what will be happening. Take as an example the Affordable Care Act, popularly known as Obamacare. It brings unprecedented government intervention into the health care industry. It can be seen as nationalization of 17.4% of our economy, health care part of GDP in 2013. Also, it brings previously unheard government intrusion into how Americans handle their health care, a very private matter. Furthermore, there is a justifiable concern that with the deep involvement of government bureaucracy, health care will become even less affordable and costlier than it ever was before. On this premise, there are voices on the Republican side calling for repealing Obamacare. Will they come to fruition beginning in January?

Any real attempt of repealing Obamacare will bring back the debates from 2009 about how bad our health care was and why it needed fixing. In the special report heralding ACA, prepared by the Council of Economic Advisers to the President, the case was made that "health care is very different from conventional goods and services" because "The markets for health insurance and medical care are classic examples of markets in which asymmetric information is important -- that is, where one party to a transaction is likely to have more information than another." Hence, "because of these market failures, government programs and policies play a large role in health care." (pp 13-14) With this ideological approach, the conclusion was obvious: health care should not be market-driven; it should be a government-run service.

Opponents of Obamacare argue exactly the opposite: our health care became inefficient and costly mostly because of excessive regulations, and that reforming it should happen by eliminating many rules and increasing the role of the free market. The scholarly argument for this line of thinking was made the best by John C. Goodman in his monumental book Priceless. The book MediCrats, by Ralph Weber, provides popular, easy-to-read presentation of the same view. Following this ideological approach would mean telling Americans that their health needs would be better served if doctors, clinics, hospitals and health insurance companies were profit driven. I wonder how many Republicans, among those advocating for repealing Obamacare, sincerely believe that greed driven health care providers would serve us better with little regulation than when tightly regulated by the government? Furthermore, how many of them would dare to tell their constituents that health care should be run like any other business, with as little government intervention as possible?

Immigration is another example. Some Republicans are very vocal about annulling the recent presidential executive orders. This reopens the debate as to why we have such a big immigration mess to begin with. On immigration, the mainstream Republicans stand for excessive government control. Some of them, if they only could, would place a policeman behind every employer, just to make sure that no illegal immigrant is hired. The radical Republican faction claiming that it is taxed enough already, aggressively advocates for government expanding its reach in limiting immigration, even if it takes more taxes to do so. No one seems to understand that our immigration laws are rooted in the same times and thinking as Prohibition was; they delegalize the otherwise moral actions -- in this instance, the desire of individuals to be able to enter freely mutually beneficial labor contracts. The thought that Americans imposed the immigration disarray upon themselves by overregulating it is not given any serious consideration. Will it change suddenly in January?

It is often said that Washington became dysfunctional. Washington reflects what Americans want. Americans want a small, efficient government and low taxes, with the exception of issues of particular concern, where they want a strong government imposing their agenda on others and they are willing to pay higher taxes to get it achieved. No one dares to tell Americans that what they want is self-contradictory; it simply cannot be done. This is why so little is accomplished in Washington.

Americans lost faith in the free market, but they still want to keep the benefits of it. They are suspicious that without government oversight, big corporations will screw them left and right. They trust much more the visible hand of the tight government regulations over the invisible hand of the free market. They are suspicious of greed-driven corporate managers, and they have much more confidence in the morality of the elected or hired government officials. There is an underlying assumption that bad people work for big corporations and good people work for the government. The only problem that Americans see in this picture is in the ballooning of lobbying, where the corporations are perceived as using their money to demoralize good people working in government. No one seems to see that lobbying can exist only with excessive regulations. The fewer regulations we have, the less it is that lobbyists can buy, regardless of how much money they have. Most regulations are intended to help a little man. However, the more aspects of our everyday life are regulated, the more opportunities the special interests have in turning these regulations their way. The proverbial ordinary Americans did not get it yet that, with every new regulation intended to protect their interests, there is an increasingly meaningful risk of them being screwed by lobbyists. The invisible hand of the free market is the only hand that cannot take bribes and does not need money for reelection.

Politicians need money for reelection, and lobbyists are a dependable source of it. Will, starting in January, Republican legislators advocate for fewer regulations and will they voluntarily give up the significant part of their funding?

When, in 1983, President Ronald Reagan called the Soviet Union "an evil empire," I lived in Poland, then a part of the Soviet Bloc. I was well aware of the faults of the system. At the same time I knew many decent people sincerely supporting it. I was told many times that the criminal excesses of socialism as we knew it were the pains of growth of an otherwise superior and, most of all, more just political system. The "evil empire" speech made me aware that the evil was not in the illicit extremes of the system but in its core concept of all-embracing government hampering the personal freedom of an individual.

The "evil empire" was not created by people with immoral intentions. It arose from the universal desire of bettering the society we live in -- a desire shared by many Americans. During my almost exactly 30 years of living in the U.S., I have been observing a gradual expansion of government intrusion limiting my liberties. Often I joke that the longer I live here, the more I feel like still being in the Poland I left 30 years ago. We still do not have the "evil empire," but we have made a giant leap in that direction. Will we go into reverse beginning in January?

It will be a challenging task as the bureaucratic monster (we have to acknowledge that we have one) tends to be hard to curb. When, in the 1990s, Russia tried to dump its Soviet ballast, commenting on one of the failures in this path, Viktor Chernomyrdin, then the Prime Minister of Russia, said: "We wanted the best, but it turned out as always." In 2016, when Republicans summarize their achievements during the two years of having controlled both chambers of Congress, will they have more to say than simply quoting Chernomyrdin?