It was 1985, and the congressman was hopping mad. He stood in front of my desk yelling at me, and then he stormed down the hall into the deputy secretary’s office. Then he ran into the office of the secretary of agriculture and raged at him. When he arrived back in my office, he was still ranting.
I was a young Reagan political appointee experiencing my first year in Washington. The congressman was angry about our bold deregulatory move: We had administratively abolished the marketing order for beer hops. This tiny federal program governed only about 50 family farms in Washington state. It authorized supply quotas that otherwise would violate antitrust laws. Marketing orders had been widely criticized by free-market think tanks as bad Depression-era regulation that hurt consumers by driving up prices and limiting competition. The beer-hops order was the smallest and least defensible and affected only one congressional district. I thought ending it would be the easy first step toward decisively deregulating oranges, lemons, almonds and ultimately even dairy products.
Our bold move nearly backfired. Even the angry congressman had been willing initially to work with us on how to ease farmers off government price manipulation, but he had to protect his constituents. By actually taking action to cut back government, we Reaganites had aroused focused opposition. We abolished the hops order, but further free-enterprise progress was slow. A number of marketing orders remain fixtures of agricultural programs.
This story illustrates deregulatory reality. Virtually every government program has its well-intentioned protectors. While the broader public may question the program’s value, its beneficiaries will fight to keep it. As the basic principles of political economics explain, strong and motivated defense can overcome lukewarm reform. Multiply this across the whole panoply of federal programs - with the intricate nuances on every page of the Code of Federal Regulations reinforced by K Street lobbyists - and the daunting task of cutting back on government becomes clear.
Recognition of this tough reality, however, is not a reason to give up on a vision of limited government. It is a lesson for would-be deregulators about the need to marshal powerful forces in favor of reform. A naive assault on the castle walls will not succeed. A halfhearted effort to cut only “wasteful” programs will hurt America’s long-term future.
So how do we bring these forces to bear? We need structural reforms that force difficult decisions. Programs need to be weighed against each other instead of evaluated by perceived inherent worth. A program should not be judged as if standing alone on a pedestal. Programs instead should be herded into the gladiators’ arena, with only the strongest emerging alive. A strict balanced-budget requirement, for example, forces legislators to battle for scarce dollars. Some good programs will be killed, but the overall effect will help America cope with economic reality.
Eliminating earmarks, establishing a line-item veto, simplifying regulations, minimizing tax complexity, reforming entitlements, implementing “sunset” reviews, setting and enforcing debt and spending caps, returning power to states - all of these offer benefits. The steps initiated by President Obama, House Speaker John A. Boehner and the Simpson-Bowles deficit commission are moves in a positive direction, but we need to go much further.
The global financial crisis has forced on us a fundamental opportunity to rethink our federal spending mechanisms. Republicans and Democrats will not find consensus on the value of individual programs but may find consensus on the need for fiscal restraint. Heartfelt debates about the proper functions of government have gone on for years, but without a true change in political incentives, the tough decisions will continue to be postponed.
Gale A. Norton was Colorado attorney general from 1991 to 1999 and secretary of the interior from 2001 to 2006.