I have been wanting to write a few words about an impressive column written by Ezra Klein back in May. Entitled “What America Needs is a Liberalism That Builds” this New York Times piece manages to hit some pretty important points about the failure of governance in the U.S. as reflected by our seeming inability to build out major infrastructure within reasonable time frames and costs. Klein is a man of the left but is not afraid to point out areas where he believes progressive governance needs improvement. He manages to bring in the issue of industrial policy, an area where there might be some convergence between left and the populist right.

Klein gives us a pretty generic statement but manages to fill in behind it with some real serious policy meat. That statement.

“You can’t transform the economy without first transforming the government.”

Ezra Klein What America Needs Is a Liberalism That Builds New York Times May 29, 2022

Klein first advocates for a U.S. industrial policy. He has focused on a speech by Brian Deese, Director of the Biden Administration National Economic Council, that calls for such a policy. While the areas where such a policy would be effective remain a source of disagreement between left and right the obvious supply chain issues, the result of years of neglect, and a belief that pure free trade and markets would solve all issues, has brought some agreement. Deese, in his speech, gives some daunting statistics:

“Consider critical minerals.  Lithium, nickel, and cobalt are building blocks in everything from computers to appliances to electric vehicles and other clean-energy technologies—and demand is set to skyrocket. Yet the United States depends heavily on foreign sources for many of these critical minerals.  China, for instance, is estimated to control 85 percent of refining capacity for rare earths. So far, private investment has fallen short of our national needs.  But through strategic coordination, we can open channels for companies to invest. “

Brian Deese, Remarks on a Modern American Industrial Policy

Klein states what has become obvious to many, although not all.

“Do we have a government capable of building? The answer, too often, is no. What we have is a government that is extremely good at making building difficult.”

This is where the Klein criticism comes in, and that criticism is not pointed at just Republicans. (Though they are not exempted either) Whether the discussion is over industrial policy or simply over how do we build simple infrastructure in a cost effective, and timely, way, both Klein and Deese point out some flat out regression in our performance as a nation.

“The first step is admitting you have a problem, and Deese, to his credit, did exactly that. “A modern American industrial strategy needs to demonstrate that America can build — fast, as we’ve done before, and fairly, as we’ve sometimes failed to do,” he said.

He noted that the Empire State Building was constructed in just over a year. We are richer than we were then, and our technology far outpaces what was available in 1930. And yet does anyone seriously believe such a project would take a year today?

“We need to unpack the many constraints that cause America to lag other major countries — including those with strong labor, environmental and historical protections — in delivering infrastructure on budget and on time,” Deese continued.”

Ezra Klein What America Needs Is a Liberalism That Builds New York Times May 29, 2022

This is the crux of the entire discussion. We have failed, and that failure is becoming a part of everyday governance in the United States. The failure is not due to labor or, environmental protections, but because we have built so many obstacles into the system that where it is possible to do infrastructure it has become prohibitively expensive, and exceedingly difficult to do timely. Pandemic supply chain issues have now made the process painful, in addition to expensive. Klein looks at specific costs of rail infrastructure, and those numbers are not pretty when we compare the U.S. to other nations.

“Even so, the United States is notable for how much we spend and how little we get. It costs about $538 million to build a kilometer (about 0.6 mile) of rail here. Germany builds a kilometer of rail for $287 million. Canada gets it done for $254 million. Japan clocks in at $170 million. Spain is the cheapest country in the database, at $80 million. All those countries build more tunnels than we do, perhaps because they retain the confidence to regularly try. The better you are at building infrastructure, the more ambitious you can be when imagining infrastructure to build.”

Ezra Klein What America Needs Is a Liberalism That Builds New York Times May 29, 2022

Klein cites “The Procedure Fetish” by Nicholas Bagley, which is also worth a read. An oversimplification would be to say that Bagley blames the lawyers, and who can’t get behind a sentiment like that??? (It will be my only fun at the expense of lawyers for the entire post) The real thrust is that we have become prisoners of process, and that ”process” is not giving us good results.

Klein, one more time:

“This is a way that America differs from peer countries: Robert Kagan, a law professor at the University of California, Berkeley, has called this “adversarial legalism” and shown that it’s a distinctively American way of checking state power. Bagley builds on this argument. “Inflexible procedural rules are a hallmark of the American state,” he writes. “The ubiquity of court challenges, the artificial rigors of notice-and-comment rule making, zealous environmental review, pre-enforcement review of agency rules, picayune legal rules governing hiring and procurement, nationwide court injunctions — the list goes on and on.”

Ezra Klein What America Needs Is a Liberalism That Builds New York Times May 29, 2022

Klein has brought much forward to both think about, and act upon. Since this column was written we have seen catastrophic failure of a water system in Jackson, Mississippi as well as so many unattended infrastructure problems throughout the country. The quote above from Professor Kagan gets to the heart of the matter but needs fuller discussion. Having processes in place to offer protections against systemic abuses is not a bad thing. Making those processes last for years is a bad thing. Streamlining permitting is only one aspect of the problem. Setting up processes that offer review, but do so within a vastly shortened window of time, with limited appeal, would cut through so many of these issues.

An industrial policy for the U.S. is vitally important if we are to be competitive internationally, especially with China. The Deese speech is but one of many important viewpoints on the subject, and his position, I believe, reflects the reality.

“The question should move from ‘Why should we pursue an industrial strategy?’ to ‘How do we pursue one successfully?’”

Brian Deese, Remarks on a Modern American Industrial Policy