Not-So-Expert Government

[Valin]

Liberty Law Blog:

Michael S. Greve

4/8/13

 

Washington Post columnist Neil Irwin celebrates, kind of, the rise of independent experts over elected politicians. It’s happening all over the world, he writes. In the United States, an Independent Payment Advisory Board (IPAB) will decide how to keep Obamacare spending under control, and a global warming policy empire is being stick-built, one rulemaking at a time, by the EPA. Congress is awol. Irwin’s chief example, predictably, is the rise of central banks, here and in Europe, as central decision-makers in the 2008 crisis and ever since. Irwin isn’t terribly fond of the trend, but despairs of political institutions and their ability to act. “When the world is on the brink,” he concludes, “decisive problem-solving trumps the niceties of democratic process. I won’t like it much—but I’ll take it.”

 

Let the record reflect that I, too, prefer expert interventions—however dubious—to global annihilation. Beyond that, though, I’m rather more skeptical of the experts’ record. I’m not at all sure Irwin has the analysis right, and I suspect that his expert heroes may be in for a crash landing.

 

Way back in the 1960s, the “experts” (along with every other major institution) lost their credibility for well-rehearsed, public choice-ish reasons: they were “captured” by regulated industries; maximized their budgets rather than public benefits; hankered for post-government employment, etc. That critique has lost of a lot of its oomph. We quickly concluded that we need the experts for the things that democratic institutions (especially parties and parliaments) are bad at: values and stability. What we did, then, was to reform expert institutions: insulate them against “capture,” subject them to publicity and “reasoned deliberation” requirements, and above all give them better tools: cost-benefit analysis. Really nifty macro-economic models. And now, behavioral economics!

 

How is this working out? Not so well, in my judgment—not for the pubchoice reasons of old, but for more Hayekean reasons.

 

(Snip)