As we’ve seen, the progressives were not the first to advocate the creation of extra-legal administrators licensed by the general will to wield arbitrary power for the greater good. Rather, the progressive desire for a new aristocracy of expertise was yet another example of how the old reactionary drives of human nature continually reappear in new forms. As Jefferson warned, “The natural progress of things is for liberty to yield, and government to gain ground.”29 My only quibble with Jefferson here is that he chose the wrong word. The dynamic he was describing was not progress but decay, or corruption.
So what happens when you commit to the notion that there is a special class of administrators allegedly insulated from politics with a providential writ to do good without reference to the law or the voters?
You get the administrative state.
What is the administrative state?
Most directly, it is the fruit of the second American Revolution. As we’ve seen, the progressives sought to inter the old “Newtonian” constitutional order and replace it with a new “Darwinian” paradigm. This new regime would be run by “disinterested” social scientists, or simply administrators, who drew their legitimacy not from “We the People” but from their superior insight and, in Woodrow Wilson’s words, “special knowledge.”*
Wilson thought it bewildering that the reformers should have to consult with the wishes of the people. If you have the “scientific” facts on your side, why would you put the question before the voters? Wilson explained that
the functions of government are in a very real sense independent of legislation, and even constitutions, because [they are] as old as government and inherent in its very nature. The bulk and complex minuteness of our positive law, which covers almost every case that can arise in Administration, obscures for us the fact that Administration cannot wait upon legislation, but must be given leave, or take it, to proceed without specific warrant in giving effect to the characteristic life of the State.30
This was not Wilson’s pet theory. This was a time when science and technology were conquering nature at a breakneck speed. Industry was achieving once unimaginable efficiencies in production. Engineering was a glamorous new vocation as experts in every field revolutionized business, medicine, infrastructure, and food production. Thanks to Darwin, the experts now believed they also understood how the human machine worked. So why not let the new “social engineers” revolutionize government the way technological engineers revolutionized industry and public works? What did the common people know about the science of society, i.e., “social science”?
The public intellectual and journalist Walter Lippmann was among the foremost critics—for a time—of old-fashioned and outdated democracy. “In ordinary circumstances voters cannot be expected to transcend their particular, localized and self-regarding opinions,” he wrote. “In their circumstances, which as private persons they cannot readily surmount, the voters are most likely to suppose that whatever seems obviously good to them must be good for the country, and good in the sight of God.”31 Putting faith in the wisdom of the people was simply a colossal error. “The crucial problem of modern democracy,” Lippmann wrote, “arises from the fact that this assumption is false.”32
This widespread conviction was put into action by Woodrow Wilson (for whom Lippmann had worked as an advisor). While Madison believed that self-interest is “sown in the nature of man,”33 Wilson believed that the science of administration could elevate man above his nature and the people he serves. The old dream of the perfectibility of man would be achieved in, of all types, the bureaucrat! Ronald J. Pestritto adds that “Wilson assumed, just as Hegel had in the Philosophy of Right, that a secure position in the bureaucracy, with tenure and good pay, would relieve the civil servant of his natural self-interestedness, thereby freeing him of his particularity and allowing him to focus solely on the objective good of society.”34
* * *
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It is vital to underscore once again that intellectuals draw their ideas from the times they live in. There is a feedback loop at work in every age. Just as the American founding was an expression of the “American mind,” as Jefferson put it, and just as rebelling against the British and romantic nationalism was fueled by a popular backlash against Napoleon and the Enlightenment among the German people, the progressives drew sustenance from a popular backlash against capitalism itself. When confronted with the seeming chaos of capitalism and democracy, the human mind retreats to its tribal programming.
This doesn’t mean Americans during the first three decades of the twentieth century dabbed war paint on their faces and fought with spears. We all speak in the language and symbols of the time we live in. Percival Lowell, the turn-of-the-century astronomer who built the telescope that discovered Pluto, lived at a time when large-scale canal building was a sign of technological and industrial advancement. So when he saw straight lines on the surface of Mars, he assumed they were put there by an advanced civilization.35 During the Progressive Era, industry, engineering, medicine, and science were making incredible breakthroughs. For entirely understandable reasons, progressive intellectuals, and Americans generally, assumed that if science and technology could solve age-old problems in real life, if industrial managers could create amazingly efficient new forms of organization, then surely experts could do the same thing for politics. This was a time when social science was new, the phrase “social engineering” had no negative connotation, and it was assumed that political science was, or could be, every bit as scientific as physics or chemistry.
But enough with the theory and philosophy. What was the administrative state in practical terms? Put most simply, it was the vast enlargement of the government. But this simplification doesn’t capture the revolutionary nature of the administrative state, because the new army of regulators and revenuers worked outside the constitutional framework, which is why the administrative state is sometimes called the “fourth branch” of government. (For reasons I’ll discuss in the next chapter, I think this label misses the mark.) Congress is responsible for making policy, also known as legislation. The president, the head of the executive branch, is responsible for executing that policy. But with the rise of the administrative state, bureaucrats began driving the policy-making process.
By the end of Wilson’s first term, the administrative state had been created. Personal income was now taxed directly by the federal government, as were corporations and estates. Big industries were broken up. The newly minted Federal Reserve regulated money, credit, and banking. The Federal Trade Commission supervised domestic industry, and its new Tariff Commission regulated international trade. State and federal labor legislation mandated workmen’s compensation; banned child labor; compelled schooling of children; established minimum wages and maximum hours; and established pensions for single mothers with young children. Armies of regulators inspected factories, intervened in businesses, and demanded all manner of licenses to work in various fields.36
One can certainly argue that some of these reforms were valuable and necessary. But that is a different argument. What was revolutionary was the argument that the state should take its own counsel on what society needed. “Social expediency,” as Frank J. Goodnow put it, now trumped constitutional fidelity and democratic sovereignty.
And all of this happened before Wilson plunged America into World War I. During the war, the American government became vastly more intrusive not only economically but also politically.
President Wilson’s war to “make the world safe for democracy” obviously had ample support for its expressed foreign policy aims, particularly among the hawkish Teddy Roosevelt wing of the progressive movement, who tended to think Wilson wasn’t belligerent enough. But for the social-engineering wing, international affairs were largely incidental. What fascinated them was what John Dewey called “the social possibilities of war.” Dewey meant by the phrase that he wanted the war to
force Americans “to give up much of our economic freedom.” He continued: “We shall have to lay by our good-natured individualism and march in step.” He hoped that the war would constrain “the individualistic tradition” and convince Americans of “the supremacy of public need over private possessions.” Another progressive put it more succinctly: “Laissez-faire is dead. Long live social control.”37
(Randolph Bourne, the dissident progressive intellectual who famously declared, “War is the health of the state,” was almost alone in noticing the “peculiar congeniality between the war and these men.” He added that “it is as if the war and they had been waiting for each other.”)38
During the war, all of the tribal impulses were given free rein. Woodrow Wilson demonized the “others” in our midst: the so-called hyphenated Americans, i.e., German-Americans, Italian-Americans, and any other ethnicity or group that didn’t commit to what many called “100 percent Americanism.” “Any man who carries a hyphen about with him carries a dagger that he is ready to plunge into the vitals of this Republic whenever he gets the chance,” Wilson proclaimed.39 Under Wilson’s administration, America created the first modern propaganda ministry in the world: the Committee for Public Information.40 It threw thousands in jail for criminal thoughts and speech.41 It enlisted the help of an army of quasi-official fascisti, the American Protection League, who beat up protestors, interrogated “hyphenated-Americans,” and enforced loyalty to the state.42
Economically, the government pursued a policy that was widely dubbed “war socialism.” Big corporations were essentially enlisted in the war effort and cartelized. The state didn’t nationalize every industry outright; instead, it pursued a policy of neo-guildism. The point was that the economy had to be oriented toward the aims of the state in all matters. Over 5,000 “mobilization agencies” were created to make sure all of the oars pulled in the same direction. The state, Robert Higgs adds,
virtually nationalized the ocean shipping industry. It did nationalize the railroad, telephone, domestic telegraph, and international telegraphic cable industries. It became deeply engaged in manipulating labor-management relations, securities sales, agricultural production and marketing, the distribution of coal and oil, international commerce, and markets for raw materials and manufactured products. Its Liberty Bond drives dominated the financial capital markets. It turned the newly created Federal Reserve System into a powerful engine of monetary inflation to help satisfy the government’s voracious appetite for money and credit.43
In the 1918 midterm elections, the Republicans took back Congress. Two years later the Republicans reclaimed the White House as well on a platform of a “return to normalcy.” The slogan resonated with Americans fed up not just with war but also with domestic authoritarianism. The progressives who saw the war as an exemplary use of state planning were dejected that the American people had turned their backs on them. As a consequence, as I detail at length in Liberal Fascism: The Secret History of the American Left, from Mussolini to the Politics of Change, the progressives cast their eyes to “advanced” countries that continued the struggle for social engineering and “scientific” management of society: Fascist Italy and Soviet Russia. The American progressive rallying cry during the Roaring Twenties was a plaintive “We planned in war, why not in peace?”
A dozen years after Wilson left office, Franklin Roosevelt entered office. The lingering Depression of 1929 provided ample ammunition—and popular support—for finding a replacement for laissez-faire capitalism, even though government interference had contributed to the economic problems the country faced. Roosevelt picked up right where Wilson left off, transforming Wilson’s war-time agencies into permanent fixtures of the state. The Securities and Exchange Commission was an extension of the Capital Issues Committee of the Federal Reserve Board. The Reconstruction Finance Corporation was an updated version of the War Finance Corporation. FDR’s public housing initiative was run by the architect of World War I-era housing policies.
Of course, Roosevelt went much further than Wilson. With Congress’s help, and the American people’s approval, American government was permanently transformed into a state.
In the next chapter we look at what has become of the administrative state.
* In this, Wilson was fitting heir to the Gnostics identified by Eric Voegelin:
And, finally, with the prodigious advancement of science since the seventeenth century, the new instrument of cognition would become, one is inclined to say inevitably, the symbolic vehicle of Gnostic truth. In the Gnostic speculation of scientism this particular variant reached its extreme when the positivist perfector of science replaced the era of Christ by the era of Comte. Scientism has remained to this day one of the strongest Gnostic movements in Western society; and the immanentist pride in science is so strong that even the special sciences have each left a distinguishable sediment in the variants of salvation through physics, economics, sociology, biology, and psychology.
Eric Voegelin, The New Science of Politics: An Introduction, Walgreen Foundation Lectures (Chicago: University of Chicago Press, 1987, Kindle edition), pp. 127-28.
9
THE ADMINISTRATIVE STATE
The Shadow Government
In the early days of the Trump administration, then White House senior advisor Steve Bannon laid out his three priorities. The first was “national security and sovereignty.” The second: “economic nationalism.” The third was “the deconstruction of the administrative state.”1 For many journalists and casual political observers, this third item was a head scratcher. But for intellectual conservatives, it was cause for celebration.2
Sometimes called the regulatory state or the fourth branch of government, the administrative state is today a vast complex of bureaucrats and regulators—and the rules they work by—outside the constitutional order. They make “rulings,” often without the slightest feedback from voters or even elected officials. (When rule making does include a “public comment” period, it is often more ceremonial than democratic.) And regulators’ success has been so complete that elected officials have been willing accomplices in this travesty. Congress, as an institution, abdicated its sole responsibility to legislate, the courts have abandoned their obligation to safeguard the separation of powers, and presidents of both parties have proved unable or unwilling to curtail the bureaucracy.
For the most part, Congress no longer makes laws the way the Founders intended. They outsource the heavy lifting to the bureaucracy. This was already true when James Burnham published The Managerial Revolution, one of the first seminal works on the subject, in 1941. “Laws today in the United States, in fact most laws, are not being made any longer by Congress,” Burnham wrote, “but by the NLRB, SEC, ICC, AAA, TVA, FTC, FCC, the Office of Production Management (what a revealing title!), and the other leading ‘executive agencies.’ How well lawyers know this to be the case!”3
Consider the Affordable Care Act, or “Obamacare.” Journalist Phillip Klein dived into the fine print and found that
there are more than 2,500 references to the secretary of [Health and Human Services] in the health care law (in most cases she’s simply mentioned as “the Secretary”). A further breakdown finds that there are more than 700 instances in which the Secretary is instructed that she “shall” do something, and more than 200 cases in which she “may” take some form of regulatory action if she chooses. On 139 occasions, the law mentions decisions that the “Secretary determines.” At times, the frequency of these mentions reaches comic heights. For instance, one section of the law reads: “Each person to whom the Secretary provided information under subsection (d) shall report to the Secretary in such manner as the Secretary determines appropriate.”4
It is impossible to quantify the discretion—i.e., arbitrary power—Congress bestowed on the HHS secretary. “Either the new powers and responsibilities given to the Secretary are too complicated for even HHS to figure
out,” Klein writes, “or they’re so arbitrary that [then HHS secretary Kathleen] Sebelius can pick and choose how she’ll comply with parts of the law.”5
But this merely scratches the surface of the administrative state. Whole agencies are independent of political control—which is very different from saying they are independent from politics. Consider just one example. According to the Constitution, only Congress can levy a tax. This is not some mere procedural nicety. It is concrete expression of the Founders’ core conviction that taxation must be legitimized by representation. That, after all, was the crux of their argument with King George. And that is why Article I of the Constitution requires that “all Bills for raising Revenue shall originate in the House of Representatives,” a.k.a. “the people’s chamber.”
But Congress has grown comfortable relinquishing this power. In 1996 the Federal Communications Commission was granted the authority to raise taxes as it sees fit. The Universal Service Fund started as a tax on long-distance phone calls. Originally set at 3 percent, within a decade the “fee” reached 11 percent, all absent congressional approval.6 (During the Obama administration, the FCC moved toward imposing a similar tax on broadband Internet services, in part because revenue had fallen off due to people abandoning landlines.)7 The revenues ostensibly go to pay for expanding access to the Internet in rural areas and providing computers for poor schools and libraries. But there have also been numerous scandals in which the monies were poorly spent, misallocated, and sluiced to politically connected players.8 As we’ll see, this should be expected.
Suicide of the West: How the Rebirth of Tribalism, Populism, Nationalism, and Identity Politics Is Destroying American Democracy Page 22