That's the front-page headline in today's New York Times. Eric Lipton begins this way:
Among the many superlatives associated with Hurricane Katrina can now be added this one: it produced one of the most extraordinary displays of scams, schemes and stupefying bureaucratic bungles in modern history, costing taxpayers up to $2 billion.
A hotel owner in Sugar Land, Tex., has been charged with submitting $232,000 in bills for phantom victims. And roughly 1,100 prison inmates across the Gulf Coast apparently collected more than $10 million in rental and disaster-relief assistance.
There are the bureaucrats who ordered nearly half a billion dollars worth of mobile homes that are still empty, and renovations for a shelter at a former Alabama Army base that cost about $416,000 per evacuee.
And there is the Illinois woman who tried to collect federal benefits by claiming she watched her two daughters drown in the rising New Orleans waters. In fact, prosecutors say, the children did not exist.
The tally of ignoble acts linked to Hurricane Katrina, pulled together by The New York Times from government audits, criminal prosecutions and Congressional investigations, could rise because the inquiries are under way. Even in Washington, a city accustomed to government bloat, the numbers are generating amazement.
Some of us are impressed but not exactly amazed. When an institution with no incentive for cost-cutting, and little risk of anyone being fired or demoted for malfeasance, sets out to spend money on the principle “It’s going to cost whatever it’s going to cost,” then you can expect plenty of waste, fraud, and abuse.
I noted last September that
Congress passed a $51.8 billion Katrina relief bill on the very day the Associated Press released a study of where the $5 billion small-business relief money after 9/11 went. It found that the funds went to a South Dakota country radio station, a Virgin Islands perfume shop, a Utah drug boutique, and more than 100 Dunkin' Donuts and Subway shops--"companies far removed from the devastation." Fewer than 11 percent of the loans went to companies in New York and Washington.
The more things change, the more they remain the same. Big boxes of government money will not be spent wisely. That's why it's a good idea to keep as many of society's resources in the private sector as possible. Private owners have incentives to cut costs, save money, and have more money to spend later. Employees of private companies know that they could be fired for waste and malfeasance, and they know that their company (or even their nonprofit) could go out of business if its costs aren't managed. Those incentives are almost entirely lacking in the government sector, where resources are acquired coercively and no one has his or her personal funds at stake.
The logical result? "Breathtaking . . . stupefying . . . amazing" amounts of boondoggles and bungles.
An article from the Minneapolis Star-Tribune on competition between physicians and nurse practitioners includes this endearing quote, which encapsulates how some providers see the U.S. health care sector:
The American Medical Association is against giving full autonomy to nurse practitioners, stating as its official policy position that a physician should be supervising nurse practitioners at all times and in all settings...
"There is an element within the physician community that gets a little antsy. ... They think it's going to take away revenue and business from them,'' said Dr. Jan Towers, director of health policy for the American Academy of Nurse Practitioners. "Really, there's more than enough for everybody.''
Cue "We're in the Money"....
For more, be sure to check out Medicare Meets Mephistopheles, to be released by the Cato Institute in September.
In the latest issue of the American Prospect (subscription), Ezra Klein has a piece saying "good riddance" to NBC's West Wing. I share the sentiment, if for different reasons than Klein outlines. His complaint is that the show was too nice to Republicans. Mine is that it was too nice to both parties — and to politics as a whole.
Has there ever been a sweller bunch of folks than Toby, Sam, Donna, Josh and C.J.? A more selfless, high-minded, public-spirited, fundamentally decent pack of, er, political operators? Where in the world did Aaron Sorkin get his ideas about how politics works?
The White House of the West Wing exists in a Bizarro-world where the Oval Office is apparently devoid of office politics. We see almost none of the infighting, backstabbing, and jockeying for position that appear in real-world accounts of White House life. And no one, it seems, is tempted to abuse power. Can you picture a young John Dean in the Bartlett White House, rubbing his hands together at the prospect of "using the available federal machinery to screw our political enemies?" A young Bill Moyers demanding that J. Edgar Hoover find homosexuals on Barry Goldwater's campaign staff? Could even a Dick Morris or a David Addington walk the halls with saintly C.J. and noble Toby? Not likely.
It's not that every White House staffer should be played as Gollum-with-a-briefcase. But the West Wing writers wouldn't even entertain the possibility that anybody gets corrupted by proximity to power.
And then there's Martin Sheen's President Bartlett. He's some sort of Catholic theologian-cum-Nobel-laureate in economics — you know, the sort of guy we usually get for the job. And of course, he's unbearably decent as well. Even his scandals are noble; no thong-snapping involved. Instead, Bartlett gets diagnosed with MS and chooses not to reveal it to the American people. This is Clinton, plus a spine and a moral compass, minus the libido. It's Kennedy's Camelot without the mob connections and the dirty tricks and the Motley-Crue-on-world-tour sex life.
The West Wing was, above all, a Valentine to power. And despite the snappy repartee and the often-witty scripts, it was a profoundly silly show. It managed — in 21st century America — to be markedly less cynical than Mr. Smith Goes to Washington.
And that was by design: Sorkin and the show's other writers and producers repeatedly spoke of their desire to renew "respect for public service" and to combat a culture of cynicism about politics. But is that really a pressing problem in modern American life? Are we too cynical about politics these days? Or not cynical enough?
The Kenya head of Transparency International, a respected anti-corruption group, has been fired on the basis of allegations of …. corruption. That follows on the resignation (and departure for the United Kingdom, for understandable reasons) of John Githongo, who had prepared a scathing report on corruption in his capacity as Permanent Secretary for Governance and Ethics in the Office of the President of Kenya. Githongo made a powerful presentation at the Cato Institute shortly after his resignation.
We've learned from experience that one way to reduce corruption is to reduce the power of politicians and bureaucrats to create “artificial shortages of freedom” through their powers to approve or withhold permits, permissions, certifications, etc., etc. Limiting the powers of politicians and bureaucrats is not the only measure that will reduce corruption, but it is certainly a central element of a solution to the problem of corruption, theft, and shakedowns.
The leadership of the National Chamber Foundation (the educational arm of the U.S. Chamber of Commerce) recently recommended to its board of directors a list of 10 “Books that Drive the Debate.” Among the recommended titles was Crisis of Abundance, a Cato Institute book by adjunct scholar Arnold Kling and the only health policy book to make the list.
The foundation's board is a bipartisan group of influential figures from the business, political, and policy spheres. The NCF also plans to recommend the 10 titles to all Chamber of Commerce members.
The complete list is pasted below. NCF chairman Bill Little told me today that Crisis of Abundance will be the first book they send out to their board members.
“Books that Drive the Debate”
NCF’s Top 10 Reading Selections
- Illicit: How Smugglers, Traffickers and Copycats are Hijacking the Global Economy by Moises Naim
- Three Billion New Capitalists: The Great Shift of Wealth and Power to the East by Clyde Prestowitz
- The Bottomless Well: The Twilight of Fuel, the Virtue of Waste, and Why We Will Never Run Out of Energy by Peter Huber and Mark Mills
- In Our Hands: A Plan to Replace the Welfare State by Charles Murray
- Our Brave New World by Charles Gave, Anatole Kaletsky, and Louis-Vincent Gave
- The Sarbanes-Oxley Debacle: What We've Learned; How to Fix It by Henry N. Butler
- An Army of Davids: How Markets and Technology Empower Ordinary People to Beat Big Media, Big Government, and Other Goliaths by Glenn Reynolds
- The Innovator's Solution by Clayton Christensen and Michael Raynor
- Crisis of Abundance: Rethinking How We Pay for Health Care by Arnold Kling
- Education Myths What Special-Interest Groups Want You To Believe About Our Schools – And Why It Isn’t So by Jay P. Greene
(Another Cato connection: in March, the Cato Institute held a book forum for Glenn Reynolds' An Army of Davids: How Markets and Technology Empower Ordinary People to Beat Big Media, Big Government, and Other Goliaths.)
The leadership of the NCF evidently agreed with Marginal Revolution publisher Tyler Cowen that Crisis of Abundance "is one of the most important books written on health care."
Gene Healy beat me to the punch in commenting on Karl Rove's Time essay on Teddy Roosevelt.
My colleague (and office neighbor) John Samples is always telling me that Bush supporters are capital-P Progressives. In the course of some parallel research a while back, I happened on an article by the historian William E. Leuchtenberg that explains the Progressives' comfort with ambitious, activist government, both at home and abroad. Fudge the language a bit in places, and it sounds frighteningly similar to the Bush administration today.
[I]mperialism and progressivism flourished together because they were both expressions of the same philosophy of government, a tendency to judge any action not by the means employed but by the results achieved, a worship of definitive action for action's sake, as John Dewey has pointed out, and an almost religious faith in the democratic mission of America. The results of the Spanish-American War were heartily approved not merely because the war freed subject peoples from tyranny, but because, since the United States was the land of free institutions, any extension of its domain was per se an extension of freedom and democracy. It was an age that admired results, that was not too concerned with fine distinctions and nice theories. The Progressives, quite apart from sharing in the general excitement of middle-class America in the rise of the United States as a world power and the sense of identity with the nation which imperialism afforded in a time of national stress, admired anyone who could clean up the slaughterhouses or link two great oceans, who could get a job done without months of tedious debate and deference to legal precedents.
The Progressives believed in the Hamiltonian concept of positive government, of a national government directing the destinies of the nation at home and abroad. They had little but contempt for the strict construction of the Constitution by conservative judges, who would restrict the power of the national government to act against social evils and to extend the blessings of democracy to less favored lands. The real enemy was particularism, state rights, limited government, which would mean the reign of plutocracy at home and a narrow, isolationist concept of national destiny abroad, which would deny the democratic mission of America and leave the brown peoples pawns of dynastic wars and colonial exploitation.
William E. Leuchtenberg, "Progressivism and Imperialism: The Progressive Movement and American Foreign Policy, 1898-1916," The Mississippi Valley Historical Review 39, no. 3 (Dec. 1952), p. 501
Karl Rove has an essay about Teddy Roosevelt in the current issue of Time. In it we learn--or, at least, we read--that T.R. had "a larger-than-life personality"; that "leadership matters;" and that "Roosevelt holds a special place in the American imagination." Edgy stuff.
T.R.'s enduring appeal is an enduring mystery. What, after all, is so attractive about Roosevelt's political philosophy, such as it was: a loudmouthed cult of maniliness; a warped belief that war can be a good tonic for whatever ails the national spirit; and a contemptuous attitude toward limits on presidential power?
Michael Chapman deflates T.R.'s legacy in this Cato Policy Report article [.pdf], and, starting this August, you'll be able to buy Cato senior fellow Jim Powell's new book Bully Boy: The Truth about Theodore Roosevelt's Legacy.