By Paolo von Schirach
July 12, 2103
WASHINGTON– Looking at America from Washington, there is little to be cheerful about. The Federal Government is both virtually broke and politically paralyzed. A truly unhappy combination. In an increasingly polarized environment, the blessings of “divided government” turned out to be the key impediment to policy-making. Absent any meaningful common ground, plenty of room for the Republicans controlling the House for blocking everything the Democratic President will propose. By the same token, the GOP can only make gestures by passing this or that in the House; but there is zero chance that the Senate will concur, let alone that President Obama will sign anything he does not like.
No “Grand Bargain”
Given this depressing scenario, forget about any “Grand Bargain” on the stuff that would really matter: comprehensive tax reform, entitlement reform, figuring out a way of fixing Obamacare. At this juncture, I am not even sure that the House will pass anything similar to the historic immigration reform bill that somehow made it through the Senate with the Democrats and many Republicans supporting it. The strident GOP ideologues in the House have set impossible “border security” standards, this way guaranteeing that most of them will vote against anything less than perfect.
Entitlements on auto pilot…
The combination of lack of money and political paralysis has consequences. The only thing that “functions” in Washington is the Federal check writing machine. Entitlement programs are on automatic pilot. They do not need to be reauthorized every year. And so retired Americans keep getting their Social Security checks, while the Medicare program keep paying for seniors’ health care.
…But no money left for anything else
But while the Federal entitlement programs keep going, the stark reality is that there is virtually no money left for anything else. Indeed, if you combine the cost of Social Security, Medicare and Medicaid you get to about 60% of Federal spending. Include Defense and you come to about 80%. Add to that pile the money needed to pay interest on the gigantic 16 trillion plus federal debt and there is essentially nothing left for the “good stuff” that Washington used to do: major infrastructure projects, funding for medical research, education, basic research conducted in the Federal Labs, and so on.
And, given our sad but enduring political paralysis, do not expect any significant transformation of federal spending composition.
Sorry to say this, but it is clear that Washington at least for a while will be a rather uninteresting place, simply because the machinery of government is blocked by adversarial politics and lack of money.
Cheer up, here is the good news!
If this is the bad news, the good news is that resilient, resourceful and flexible America may have figured out creative ways to get around the Federal Government morass. As Bruce Katz of the Brookings Institution, a major Washington think tank, explains to us in an FT essay, (America is at the vanguard of the global metropolitan revolution, July 12, 2103), Washington paralysis and bitter divisions notwithstanding, diverse US Metropolitan Regions have transformed themselves into dynamic innovation centers and laboratories of experimentation.
In other words, Austin, Cleveland or Boston do not have to wait for Washington to get its act together, so that it will create, fund and administer new programs aimed at them, in order to get ahead. The major cities, acting on their own, today do what needs to be done relying on their own resources, finances and –most of all– brain power. And this latter component, brain power, may be indeed the key to everything else.
Smart people design local solutions
In this new global knowledge economy, it is indeed possible to rethink public policy and policy solution. The notion that America needs a Federal framework to address all major issues may very well be outmoded. New software can be developed locally to optimize and cut costs from existing programs. Smart innovation can improve performance in garbage collection, street lighting or school meals.
And, if we look into the future, there is ground for even more optimism. Energy efficiency improvements, combined with ever evolving renewable energy technologies, will allow cities to generate and distribute their own low cost electricity, without having to rely on the vast and cumbersome networks of regional or national power grids.
3D printing
Further down the line, the evolution of 3D printing holds the promise of customized, (and that also means localized), production of even sophisticated machinery at very low costs in whatever quantities, without any large-scale factories.
Besides, the development of sophisticated on-line teaching tools in just a few years will make complex knowledge available to anybody with a computer and a decent internet connection. And this means more smart people added to the talent pool.
Further down the line, vertical urban farming will most likely solve the problem of feeding the millions who live in large urban areas. By growing essential food products in vertical green houses, (skyscrapers hosting broccoli and lettuce), cities will be able to produce quality food with almost zero impact on the environment.
Far fetched?
Sounds far-fetched? Not too much. The reason why large US metro areas may get ahead without Washington’s help is because many of them can create or attract the resources they need, financial as well as intellectual, to implement new, growth oriented and socially palatable solutions.
Washington was extremely relevant at a time in which no other American power center could harness, control and direct the large resources necessary to tackle large problems. Today, this may be still be true; but only in limited areas such as federal justice administration and national security.
Washington is no longer essential
At a different level, it used to be true that Washington could and would fund basic research, something that private corporations would not undertake, because of high costs and uncertain economic pay back. But now we are moving into an era of super, super computers with remarkably increased capabilities, while new frontiers are opened practically on a daily basis. It may no longer be true that in order to tackle really Big Issues America has to rely on Washington’s mighty help.
The US future may be more about local resourcefulness, creative collaboration and cost cutting innovation. If this were indeed so, then there is still hope for America., despite Washington’s paralysis and inaction.