Posted by on May 3, 2020 1:47 pm
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Categories: Competition & Regulation

 


By Martin Gurri, courtesy of the Mercatus Center

 

Like most people I know, I am presently trapped in social isolation, stuck in a dreamlike parenthesis between what was once normal life and the uncertain struggles lurking on the other side. We are huddled, most of us—the fortunate ones—in our hiding places, waiting. That will not last. Sooner rather than later, there will be a re-set of our society. The question we should be asking during this bizarre interlude is what we wish to make of it.

 

The pandemic crisis has shattered the comfortable old order of things. When we meet again, face to face, we should have some idea of how to apply this brutal lesson as we try to piece the world back together.

 

An essay recently posted by Marc Andreessen surveys the wreckage caused by this crisis while offering a vision of how to survive the next one. Anyone with the slightest interest in the future should read it. Andreessen—co-founder of the early web browser company Netscape, as well as one of the biggest venture capital firms, Andreessen Horowitz—is a semi-legendary figure in both of Silicon Valley’s specialties, technology and venture finance. He is also one of the most knowledgeable people I know—a voracious reader and original thinker, endowed with that strange mix of cynicism and idealism sometimes found in our technology elites and so disconcerting to a world-weary Easterner like me.

 

The essay begins with an unsparing assessment of the scope of failure of the established order:

 

Every Western institution was unprepared for the coronavirus pandemic, despite many prior warnings. This monumental failure of institutional effectiveness will reverberate for the rest of the decade, but it’s not too early to ask why, and what we need to do about it.

 

Many of us would like to pin the cause on one political party or another, on one government or another. But the harsh reality is that it all failed—no Western country, or state, or city was prepared—and despite hard work and often extraordinary sacrifice by many people within these institutions. So the problem runs deeper than your favorite political opponent or your home nation.

 

The coronavirus mess, he goes on to say, has been “a failure of action, and specifically [of] our widespread inability to build.” We lacked the foresight to build, in advance, the medical equipment, test materials, therapies, and vaccines that would mitigate the pandemic. What’s more, we lacked the competence to build these during the crunch. The whole world has been at fault, but Andreessen is clearly distressed by our uniquely American failures. As an investor whose job it is to move money quickly, he is shocked by our inability to release federal relief funds at the speed of need. “A government that collects money from all its citizens and businesses each year,” he writes, “has never built a system to distribute money to us when it’s needed most.”

 

The reason for these pratfalls is not lack of money, technology, or manufacturing prowess, Andreessen maintains. The reason is lack of will. The reason is inertia, “this smug complacency, this satisfaction with the status quo,” reflected by a culture of virtue-signaling and codified in regulations that seek to petrify things-as-they-are into eternity. To build a new home in San Francisco, for example, is a long and costly ordeal, “making it nearly impossible for regular people to move in and take the jobs of the future.” We have become more comfortable with a society locked down in a deep freeze, it seems, than with the displays of energy and ingenuity that would have made that desperate move unnecessary.

 

The coming reset will provide an opportunity to “reboot the American dream.” For Andreessen, the time has come to build. That is his theme and his challenge to both poles of the political spectrum. The right should support a private sector that invests aggressively “in new products, in new industries, in new factories, in new science.” The left should expect the public sector to “build better hospitals, better schools, better transportation, better cities, better housing.” He concludes:

 

The things we build in huge quantities, like computers and TVs, drop rapidly in price. The things we don’t, like housing, schools, and hospitals, skyrocket in price. What’s the American dream? The opportunity to have a home of your own, and a family you can provide for. We need to break the rapidly escalating price curves for housing, education, and healthcare, to make sure that every American can realize the dream, and the only way to do that is to build.

 

Of those inclined to criticize his position, Andreessen asks: “What do you think we should build?” It’s an invitation to break with the immobile present. We have to escape the grip of the deep freeze.

The Pandemic as the Unmaking of the Institutions

 

Andreessen plainly intends to nudge the public conversation away from criticism and scapegoating. To the extent that he succeeds, he will have contributed to the good health of post-pandemic society. Nothing useful or productive has ever emerged from under the shadow of the rant.

 

But there are fundamental choices before us, connected to Andreessen’s thesis though not part of his story, that I would like to consider here.

 

This is a moment of great destruction. A prosperous global economy was obliterated within a few weeks. Famous health and science organizations, national and transnational, have stumbled and mumbled their way to irrelevance. The expert class stands discredited in the eyes of a public looking for clarity and wisdom. The governments of powerful nations, super-national alliances like the European Union, political parties of every description, ideological sects of left and right—all have wavered between paralysis and ineffectual posturing. The ruling elites are visibly out of their depth. The information sphere, mass and digital media alike, is consumed by a panicked search for culprits to offer as human sacrifices to the plague. Without question, Andreessen is right. Failure has been monumental.

 

Many causes flow into a foul-up of such massive proportions, but two of them strike me as compelling. First, the COVID-19 contagion spread much faster than the capacity of the big political and scientific institutions to react. These institutions are a legacy of the 20th century: they worship process and move with bureaucratic deliberation. Second, and conversely, the information sphere kept pace with the disease. The public was aware of the mounting death toll, and of the institutional confusion that seemed unable to prevent it. The variance between a public riding the speed of light and elites lost in a labyrinth of proceduralism fatally eroded the credibility and authority of the latter. This old tale became the plot played out, repetitively, in the media theater of the pandemic.

 

So how do we get from here to build? To demand that our current institutions make that leap would be like asking the Great Pyramid to win the Indianapolis 500. It won’t happen. As a precursor to Andreessen’s building spree, our institutions—certainly government at every level, including the regulatory and scientific agencies—must crack open their industrial-age cocoons and join the rest of us in the digital dispensation. At a minimum, they must be able to move as fast as information does today. This will require different protocols, different technology, a different form: less like the Great Pyramid and more like a race car. They must be flatter and faster.

 

None of this will happen by itself, of course. The great reset will be here soon. Do we want to face the next crisis with the same antique structures that botched this one? The question answers itself. Already the pressure generated by an existential threat has forced health agencies to expedite their procedures: the Food and Drug Administration (FDA), for example, has introduced an “emergency program” to speed up delivery of new COVID-19 treatments to patients. The old forms have shown that they can shuffle along a bit faster than has been their habit.

 

That is not nearly enough. We need a government that is functionally aligned with its mission. And this, I feel certain, will require significant structural reform. Let me make clear what I mean by that phrase.

 

The Constitution as a Potential Barrier to Reform

 

When I talk about the need for structural reform, I am often asked whether I’m a supporter of Elizabeth Warren. The Massachusetts senator and former Democratic presidential candidate has put forth plans that entail an enormous increase in the size and scope of the state: a Green New Deal for the environment, government-paid health care for all, subsidized tuition for college students, etc. This is an old-fashioned idea of structural reform. By a strange categorical inversion, Warren considers herself a progressive, even though she is manifestly a reactionary, consumed by nostalgia for the epic programs of high modernism. She dwells in a political theme park that might be called “FDR World,” in which the cure for government immobility is more structure, more procedure, and more layers between power and the ordinary citizen. From a strictly functional point of view, I can’t imagine how that would work. In the real world, a bigger pyramid will not get you to flatter and faster.

 

Neither Warren nor any other elected official that I am aware of has taken up the mantle of structural reform. Destruction and necessity, I suspect, will change that.

 

A serious objection to reform is that the Framers of the Constitution, through the doctrine of the separation of powers, purposely made decision-making a slow and difficult process. And they did so for a good reason: A zeal for efficiency would lead to “the accumulation of powers… in the same hands,” which James Madison found to be “the very definition of tyranny.” Hungary’s Viktor Orban, the elected prime minister of a supposedly democratic nation, has used the COVID-19 crisis as a pretext to secure legislation granting him unlimited power for an indefinite period of time. That is precisely what Madison and the Framers wished to avert when they gave us a jumble of overlapping authorities. The chaotic response of our institutions may simply reflect their original design—and, as events in Hungary show, such clumsiness is not the worst outcome possible.

 

In fact, decision-making around the pandemic has moved remarkably fast. The failures have been almost entirely of implementation and regulation. For all the checks and balances, the unprecedented $2 trillion stimulus package made it through Congress in record time—but the small businesses that most desperately need the money have had trouble getting access to it. As Andreessen observed, we chose not to build that system. Early on, the surgeon general and the Centers for Disease Control strongly advised against regular use of surgical masks—now they recommend wearing them. The FDA initially behaved as if its task was to prevent treatments from reaching the public. Why not? That had always been the status quo.

 

These are not constitutional questions. These are cascading structural failures.

 

The most dysfunctional regions of our democracy fall outside the framework of the Constitution. Political parties, for example, have hemorrhaged membership and engagement to the point that they barely have a pulse. No reason exists why parties can’t strive for the energy, participation, and shared interests of a healthy online community—say, a combination of Wikipedia-style governance and subreddit-like openness. This kind of digital party community could, illustratively, vote on the five most attractive potential candidates for president, thus winnowing to a reasonable number the grotesque buffalo stampede that is the nominating process. An information sphere that has driven us, panicked, into our homes, and tormented our broken politics, can be restructured any number of ways within the benevolent boundaries of the First Amendment.

 

The alternative to reform is decadence. It’s hard to picture a middle ground: the damage runs too deep already for a return to normality. If we pretend otherwise, we will resemble those Roman aristocrats of the 5th century who behaved as if past glory would somehow keep them safe. An ugly reality intervened. Barbarians swarmed over the walls, and what followed was the exact opposite of Andreessen’s call to build.

 

We have choices to make and we should face them without flinching. We must summon the will to leave the past behind us, without abandoning our best traditions. And we must adapt our institutions to a flatter, faster world, and build, as Andreessen implores us to do, the products and systems that will sustain American society over the next generation.

 

In the short term, the most consequential choice is when to re-enter the swirl of events. Much remains unsettled and uncertain, but we know, without question, that when it comes to history, “shelter in place” is not an option.

 

 


Martin Gurri is a former CIA analyst specializing in the relationship of politics and global media.  His book, The Revolt of the Public and the Crisis of Authority in the New Millennium, first published in 2014 and updated in 2018, has been praised for foreshadowing the political shocks of Brexit and the rise of Donald Trump.