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Launching his not-quite-a-presidential-campaign in Detroit this week, Jeb Bush delivered what I think would be an incredible speech for a job that doesn't actually exist. Call it "Mayor of America."
What Jeb didn't do was offer a speech that suggests he'd be a good president, or is even aware of what the president's job is. The good news is that Bush's mayoral campaign really did launch with a smart speech. In theory, he could start applying that intelligence to national issues. But the risk is that he'll just robotically apply local government insights to the federal situation.
The federal government is different
It's crucial to recognize that in the United States, the federal government does not operate as a scaled-up version of a state or local government. The federal government is an insurance company with an army, spending the vast majority of its resources on the military or cutting checks. State and local governments, by contrast, spend money on police officers, bus drivers, fire fighters, and other front-line service providers.
They also tax differently. State and local governments collect regressive sales and property taxes, while the federal government collects progressive income taxes.
All of which is to say that the big question in state/local government is how to spend middle class people's money wisely on services that are better provided collectively than on the free market. But the big question in the federal government is how much money to redistribute from the rich/young/healthy to the poor/old/sick. These are totally different questions, and Jeb isn't even bothering to answer the second one.
Detroit as metaphor
Bush didn't just deliver his speech in Detroit. He used Detroit as synedoche for the entire United States of America. "In a sense," he said, "the troubles Detroit faces are an echo of the troubles facing Washington, DC."
That might be true if Jeb meant DC, the city. He noted that building code enforcement in Detroit made it too hard to open and operate small businesses. He noted that inefficiency in government — the city's parking ticket collection operation actually lost money — made it uneconomical for people to live there. He praised Uber and condemned excessive regulation of food trucks. These are all very real problems and they deserve to be taken seriously. Looser rules on new buildings, food trucks, taxi rides would help almost any American city. And many cities are struggling mightily to provide services in a cost-effective way, even though failure to do so will lead eventually to depopulation and an eroding tax base.
But while these are important insights about municipal governance, they're a terrible metaphor for the federal government. To make it seem compelling, Bush quipped that "on Amtrak they lose money on the snack car."
The way Amtrak operates its food services outside the Northeast Corridor is genuinely disastrous. But intercity passenger rail — along with the National Park Service — are real edge case outliers, in which the federal government does act like a state government. Deploying Amtrak's $340 million in federal subsidies more efficiently — or eliminating it entirely — is simply neither here nor there as far as the federal budget is concerned.
That's why over the past few years congressional Republicans have been putting forward deeply controversial budget proposals that would drastically curtail health care spending on the poor and the elderly. This is tricky political terrain, but it's also where all the money is.
Politics of evasion
One possibility is that Jeb's plan is just to brush all this under the table. On the few occasions when he did address national policy in the speech, he did so in a rather cursory and dishonest way. He claims the Obama administration "cut the definition of a full-time job from 40 to 30 hours, slashing the ability of paycheck earners to make ends meet" which is a wild mischaracterization of Obamacare's full-time work provision. He also mischaracterizes Obama's now-abandoned plan to change the tax treatment of 529 college savings accounts.
Simply refusing to talk about income tax rates, Social Security, Medicaid, and Medicare could just be a way of trying to talk around the fact that Republican positions on these programs are unpopular. Most Americans don't want to cut health and retirement benefits for the middle class and the poor in order to finance lower tax rates on the wealthy. Mitt Romney and Paul Ryan tried to argue that such a swap was necessary for economic growth and/or that it was simply more just than an Obama-esque agenda of "spreading the wealth around."
A disastrous confusion
A more ominous possibility is that Bush genuinely plans to run the country as if he's running a municipal government.
"If a law or a rule doesn't contribute to growth, why do it?" he asks in the speech, "if a law subtracts from growth, why are we discussing it?"
This is something more county commissioners, mayors, city councillors, etc. around America really ought to ask themselves. But in terms of the federal government's main regulatory activities, it's awfully silly. Why does the Clean Air Act impose some rules whose repeal would boost short-term economic growth? Well, it's to keep the air clean so that the act of breathing is not unduly impaired by toxic pollutants that kill people and stifle children's intellectual development. The Clean Water Act does something similar for water. Another federal law that's recently been in the news is the ban on pregnancy discrimination. Here we have a tradeoff that involves both basic fairness (discrimination is morally wrong) and the long-term viability of American society (someone's got to have babies) at the expense of a short-term burden on business growth.
Another big topic is financial regulation. As Jeb's brother proved, lax bank supervision can boost short-term economic growth (through, for example, a credit-fueled house price boom) at the cost of destabilizing the economy over the long-term.
Now this is not to say that there are no purely protectionist, genuinely unnecessary federal regulations out there. The Jones Act, barring foreign-owned ships from moving goods from one American port to another, is a good example and it's not the only one. But the fact remains that these kind of rules are far from the center of national politics. Love or hate the Obama administration's initiatives on environmental and financial regulation, they're not petty tyranny they're an effort to tackle big national problems — the kind of problems Jeb doesn't so much as mention in his speech.
The irony of big government
"Let's start with the simple principle of who holds the power," Jeb said "I say give Washington less and give states and local governments more."
This is boilerplate stuff for a Republican, especially a former governor. But as Jeb should recognize from his excellent disquisition on overly-intrusive local governments, it's actually not much of a solution. Local governments often face perverse incentives to be hyper-responsive to the demands of noisy local interest groups. Federal policymakers are swayed by special interests too, of course. But people in high-profile jobs with broad responsibilities have at least some incentive to think about the big picture. There's a reason, after all, that Jeb's speech was so heavy on examples of bad local government and light on ones relevant to the president's authority.
Indeed, he might have — but didn't — note that the Obama administration is actually on his side, using the Federal Trade Commission to help Uber fight taxi monopolists and proposing an initiative to combat excessive occupational licensing rules.
A campaign against excessive state and local government rules doesn't really make sense as the centerpiece of a presidential campaign. But it is a pretty good idea. Yet actually doing anything about it requires more federal meddling with things rather than less. Like doing almost anything else in the White House effectively, in other words, it requires adopting a presidential perspective rather than a mayoral one. It's just one speech, but so far Jeb isn't doing it.
