Scott Sumner prefaces a very interesting overview of the German Crisis of 1931 with a political non sequitur:
First I’d like to make a few comments on this amusing video. My favorite line is when Joe Biden prays to God. I didn’t know that politicians talk to God in the same dishonest way they talk to voters. Bloggers on the right and on the left who think the other party is a bunch of lying weasels are half right. They are a bunch of lying weasels. But so is their own party, which they somehow overlook. Above the fray independents have the right attitude toward most politicians of both parties—contempt.
BTW, in my view Bush was right and the Dems were wrong in 2005, and Obama is right and the GOP is wrong today. The filibuster makes no sense. Indeed I’d like to see a parliamentary system in this country, where something like the German Free Democrats was in the center, determining what got done. Some people seem to believe the filibuster favors small government, but I find that unlikely. Size of government is just as likely to shrink as to grow, otherwise government would head toward 100% of the economy in the long run. So in the steady state there will be equal number of proposals to shrink government as to expand government.
When 59 people disagree with 41, the 59 are more likely to be right. If they were more likely to be wrong, we ought not have democracy at all.
OK, enough political nonsense. On to 1931:
His first paragraph is actually spot on. Most partisan squabbles consist of pots calling kettles black. People fail to recognize this for various reasons, perhaps because politics is a mind killer. The second paragraph where he asserts that the size of government is just as likely to shrink as grow is where he goes wrong. While federal government expenditures have remained at a pretty constant percent of GDP, there is a pretty clear upward trend when the outliers of the world wars are excluded.
The conservative revolution that started with Reagan in the 1980’s is interesting not because government shrank (Bill Clinton and his republican congress did see total government spending shrink by about 3% of GDP), but because throughout that time period government remained pretty constant as a percent of GDP.
While federal government spending as a percent of GDP might have been more constant than total government spending, their partial funding of joint programs with the states has encouraged the large increases in state level spending. Furthermore, a steady state government wouldn’t be growing at the same rate as the general economy. Assuming zero efficient gains, it would grow with population and with wages. If the government took care of the same tasks and had even slight productivity gains, its size relative to GDP would shrink as the rest of the economy grew so the mere fact that it is keeping track with GDP spending suggests that government has a tendency to grow instead of shrink.
Outside of pointing out the empirical trend of increases in government spending, there are very clear public choice reasons as to why new programs will generally lead to more spending. In this regard, Bryan Caplan asks a very interesting leading “extra credit” question that almost answers itself.
Suppose you had a billion dollars to spend in Washington to advance liberty. What's the biggest libertarian policy reform your billion could buy? How precisely should you spread your money around?
Remember: Many obvious strategies would lead to bad publicity and serious pushback. Your answer should take account of this feedback.
Extra credit: Suppose you had a billion dollars to spend in Washington to advance statism. How does the optimal strategy change? If there's a big asymmetry, explain its source.
As for wondering why a straight up majoritarian approach isn’t always the best legislative approach, Will Wilkinson has a good post on how simple head counting systems excludes any measure of the intensity of the voter’s preferences.