The concept of “state capacity” has become popular in the economic literature, particularly to explain why modern democracies seem unable to get anything right, from providing public services to managing their budgets. The subject of a recent article on The Economist illustrates the situation: “Governments are Bigger Than Ever. And They’re Too Irrelevant: Why Voters Across the Rich World Are Sad” (September 23, 2024). According to this magazine, the main reason lies in the growth of rights (guaranteed transfers) as opposed to public services such as schools or infrastructure. This situation is seen in America and elsewhere in the rich world.
Another feature is the disabled control. One example (“Harris Broadband Release Has Been a Fiasco,” The Wall Street JournalOctober 4, 2024):
The 2021 infrastructure law includes $42.5 billion for states to expand broadband to “underserved,” especially in rural communities. Three years later, not a single project has been broken. The administration recently said construction won’t begin until next year at the earliest, meaning many projects won’t be operational until the end of the decade. …
Countries must submit plans to the Department of Commerce on how they will use the funds and their bidding process for suppliers. Businesses have piled on unconstitutional laws and rejected country plans that don’t promote sustainable goals. …
The administration also set hiring preferences for “underrepresented” groups, including “older people,” prisoners, racial, religious and ethnic minorities, “indigenous and Native American people,” “LGBTQI+ people,” and “people adversely affected by persistent poverty or inequality.” .”
It is not a matter of which political party is in power. What the government can’t do right often refers to what some defender of the government’s position thinks the government should be doing more of. “State power” is a term that refers to state power.
It seems surprising that a democracy does not have the power of a state since the scope and methods of operation have expanded over a century. Another indicator is that, across the OECD, government spending has grown from around 10% of GDP at the beginning of the 20th century to more (and sometimes much more) over 40% today. The Code of Federal Regulations contains 1,089,462 restrictions (by the end of 2022), measured by the number of keywords “must,” “must,” “shall not,” “required,” and “prohibited,” more than double the number. in the late 1970s.
It’s an illusion of Wonderland to believe, like Daron Acemoglu and James Robinson in The Narrow Corridor, that state power can grow forever as long as “social power” grows simultaneously (see my review of The Little Tunnel in the middle Regulation). We get a glimpse of the effect in Acemoglu’s subsequent book (with Simon Johnson), Power and Developmentwhere the good and benevolent Leviathan follows his advice and fights for all progressive causes, against greedy corporations and the support of powerful and mindless trade unions (he may exaggerate slightly: see Regulation review of Power and Development).
Anthony de Jasay’s model of democracy (see especially his book The state) is very useful in explaining where the power of the state leads. For decades, the misguided state has responded to the complaints of powerful political groups by discriminating against them (through subsidies, tax breaks, and favorable laws) at the expense of other citizens. The leaders and activists of these recently imprisoned groups voiced their grievances and put forward their demands. Political competition leads politicians to try to satisfy new grievances. Policies are overlapping and increasingly overlapping and conflicting. The higher state power gained in this process further motivates special interests and their activists to demand more rights, and the process continues.
Analysts who see growing discontent often cannot put their finger on its true origins. Janan Ganesh is just around the corner on September 23 Financial Times column titled “The End of a Famous Politician.”
The cause is state power—read “state power”—in a democracy, which turns into a political war of all claimants against all, with growing redistribution. Because of the dynamics, it is often unclear whether a person, on the net, is a beneficiary or an exploiter of the system. The state is gradually shrinking to satisfy all the conflicting demands directed at it. A bad situation seems to be weak. Everyone grows dissatisfied. Populists thrive on their promises to appease the grievances of their followers at someone else’s expense.
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You will see many strange things in this picture created by DALL-E to illustrate my post, but many strange things happen in the world of politics. We can understand that this poor robot is lost.
An angry crowd shouts grievances and conflicting demands on the government
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