Earlier this spring, I spent some time at a backcountry ranch in the Northern Rockies. I was eating breakfast when a woman joined our table. She was very friendly and pleasant and, it turned out, a nuclear engineer at one of our 17 national labs.
Besides design power plants and bombs one hopes never explode, what does a nuclear engineer do? This one was trying to work out how to power a rocket to and from Mars with a small nuclear reactor—a turn of phrase that struck me as oddly redundant and oxymoronic. Mars is, on average, 140 million miles away. The moon is less than a quarter of a million miles away. To get to the moon it took 13 years and $283 billion (adjusted for inflation), so this is no small problem for rocket scientists.
Towards the end of breakfast, someone else ambled into the eating area: a fellow who looked every bit the part of a coyote hunter. Turns out, he was a coyote hunter, part of the USDA’s Wildlife Services program. Wildlife Services seems a somewhat ironic title in that a large part of the program’s charter is to eliminate wildlife, specifically predators like coyotes, wolves, and foxes. Livestock Services might be more appropriate, as livestock (and their owners) are the primary beneficiaries of the program. To be fair, Wildlife Services also works to eliminate invasive species, identify wildlife diseases, and reduce aviation strikes and crop damage caused by birds. According to USDA reports, in 2020, Wildlife Services euthanized 62,537 coyotes and 381 gray wolves. Also eliminated were 790,136 European starlings, 113,331 feral swine, and 414 armadillos.
I suppose this could be the beginning of a belabored joke: “A nuclear engineer and a coyote hunter walk into a dining room …” Lucky for you, I gave up telling jokes decades ago after badly botching one in front of my high school drama class.
But this was a curious coincidence. How could these two people possibly have the same employer: the federal government? Still more questions came to mind. Why do we even have government? Should it provide everything from the aspirational (Mars) to the mundane (armadillo control)? And who should pay for it and why? In sum, the size and scope of government is a vexing debate in this country.
Our Declaration of Independence, which started all this, was an assertion of three seemingly simple ideas. One was that all “men” (and women) are created equal—a premise without which self-government, America’s reason for being, is nonsensical. To make the point, in an imaginary democracy of 1000 people, a king’s vote could be apportioned a value of 999, and all his people given 1 vote. Would that constitute self-government, our ultimate goal in fighting the Revolutionary War?
A second assertion was that certain “natural rights,” given to us by a notably undefined God, pre-existed all human laws. These were, of course, the right to “Life, Liberty, and the pursuit of Happiness.” This provision was meant to trump any notion of the divine right of kings.
Finally, the Declaration asserted that governments, with the consent of its people, were created solely to “secure these rights.”
So how did we get from securing natural rights to coyote hunters and Mars missions? It comes down to what you think life, liberty, and pursuit of happiness mean.
Life is easy; protecting us from foreign and domestic dangers seems straightforward.
Government securing our liberties gets a little muddier. Liberty, in the days of the Declaration, was understood to be freedoms that didn’t deprive others of freedoms. It assumes we live in some sort of defined society and that one’s actions can adversely affect others’ ability to pursue life, liberty, and happiness. As Thomas Jefferson wrote, liberty is “… unobstructed action according to our will within limits drawn around us by the equal rights of others.”
Part of the confusion today is that liberty is used interchangeably with freedom, the latter of which implies unrestrained actions. To provide a concrete example of the difference: Do I have the right to rebuff government-imposed COVID-19 public health measures—masks and vaccines—if, by breathing in your face at the check-out stand, I threaten your health and, potentially, your life? Traditionally, freedom says yes, liberty says no. This distinction has been lost over time.
“Pursuit of Happiness” is even more difficult to parse. At the time the Declaration of Independence was written, “pursuit,” had a connotation less of seeking and more of attainment. Still, “happiness” is more problematic. Is it property? World peace? Health? Social justice? Or is it something else entirely that we have a right to attain? Everyone has a different idea of what it is. So, one of our “natural” and unalienable rights, what we fought for—“Happiness”—is about as subjective as it comes. It follows that what government should and should not be doing in securing it is inherently subjective too, and, therefore, fuel for political bonfires.
Saying big government is bad or big government is good is not good enough; we need to look at it in a more analytical way to gain any clarity on what we want. Size—absolute dollar amounts—and scope—the types of things government does—are the relevant parameters. But to complicate the puzzle more, the size of government expands due to structural reasons as well as with broadening scope. By structural, I am referring to the way our spending is fundamentally and legally organized, which is into three buckets: mandatory, discretionary, and interest on debt.
Mandatory spending—$3 trillion in 2020, according to the Congressional Budget Office (CBO)—basically comprises our social programs: Social Security, Medicare, Medicaid, and unemployment assistance. The dollar amounts of these cannot be set by Congress, only who is eligible and the largesse of specific benefits. With an aging population—more people drawing Social Security, fewer young workers paying in, and with more of the population with expensive health issues entering Medicare and Medicaid—these programs by their very definition get bigger, all eligibility and benefit rules being constant.
Discretionary spending—$1.4 trillion—represents all other government programs, which Congress can and does control, including the military, education, transportation, and various other entities such as national labs and Wildlife Services.
Interest on debt—$0.4 trillion—is, well, interest on debt, which is created when we spend more than we take in with taxes for a given year.
So, almost 71 percent of $4.8 trillion of spending in 2020 was effectively not even up for debate as far as budgeting decisions go: 63 percent from mandatory items and 8 percent from interest payments due.
The structural effects on a ballooning budget over the last 60 years are easy to see in the CBO graph below showing the relative spending on mandatory, discretionary, and interest items.
As a percentage of our budget, interest has been relatively steady, but mandatory spending has gotten much bigger and discretionary much smaller.
Clearly, unless eligibility rules and benefit packages are amended, both the dollar amount and the proportion of our total budget will continue to rise—barring any dramatic demographic changes—due to mandatory spending.
As far as scope goes, it is really controlled by Congress and its discretionary authority. Certainly, a wider scope of government—funding for euthanizing armadillos, for instance—will add to the size of our budgets, but nothing like what mandatory spending increases are and will be. So, reining in discretionary spending has an effect but only on about 30 percent of the budget.
I remember as a kid seeing big signs on the side of the road: “Your Tax Dollars at Work.” These were good in one regard: Taxpayers could see with their own eyes what exactly they were buying with their hard-earned tax dollars. Unfortunately, those job sites invariably had more than their fair share of guys leaning on shovels smoking Marlboros. Beyond bad public relations, this scene speaks to the twin Achilles heels of government: inefficiency and accountability. Without accountability there is rarely efficiency. Likewise, as projects (and governments) get big, they get inefficient; and when they get inefficient, accountability gets lost in the construction dust.
It is true that private markets are often more efficient than governments in solving problems. Unfortunately, they don’t work in every situation. We, as a society, might value certain things that private industry has no vested interest in addressing. Put another way, if the cost or value of something doesn’t appear on a company’s income statement, why would they consider it? It’s what an economist would call an externality. There are many of them out there, but one obvious example is long-term clean air and water. Generally, we all need it to live, but no single private entity has the specific financial incentive to address it.
So, what is the right size of government? Justice Potter Stewart once addressed a different subjective question—what is “hard-core pornography?”—by famously saying, “I know it when I see it …”
Maybe. However, when the size of government next comes up for debate, before answering reflexively, it’s worth asking a few pointed questions: what exactly do you want from government? And why? And at what cost? Perhaps most importantly, what exactly does happiness mean to you?
Some guys love a good coyote hunt; others like the idea of little bombs carrying us to distant places.