Categories: Finances

In defence of the state

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Civilised societies depend on institutions. The more complex the society, the more vital those institutions. Institutions provide stability, predictability and security. Companies, schools, universities, and courts are all institutions. But the most important institutions are those of the state. This is why Donald Trump’s assault on what his supporters misleadingly call “the deep state” is so dangerous. Some of them think the state should be servile to the whims of the great leader. Others think it should be at the service of the wealthy. Both sides agree that its ability to meet the needs of the wider public is of little significance. These views are dangerous. They are harbingers of autocracy, plutocracy and dysfunction.

In an important series of articles, Valuing the Deep State, Stanford’s Francis Fukuyama examines why the evisceration of the state will prove so destructive. Fukuyama has devoted much of the past two decades to explaining that “a high-capacity, professional, and impersonal state is critical to the success of any society”, including notably modern liberal democracies. This view is one that many Americans abhor: they see the state — or simply “government” — as the enemy. But anybody who has worked on economic development, as I have done, knows that without a competent, professional and neutral public service nothing in society really works. The more sophisticated and complex a modern society and economy becomes, the more true this is. As Fukuyama rightly notes, the extraordinary success of east Asian economies is largely due to the fact that they had understood how to run such a state long before the west. Even more relevantly, he argues that a “successful democracy . . . needs a strong modern state, but it has to be a state that is constrained by a rule of law and democratic accountability”.

In the US, the creation of such a state began in 1883, he argues, with the Pendleton Act, which created the Civil Service Commission and established merit-based criteria for hiring and promotion in the federal service. This is what the Trump administration — or, as the historian Timothy Snyder labels it, the “Mump regime”, giving due credit to the unique role of Elon Musk — wishes to overturn.

As Fukuyama explains, the US bureaucratic system is far from perfect. But the problem is not, as rightwing critics argue, the fact of delegation of decisions. Does anybody imagine that technical decisions on safety of aircraft or pharmaceuticals, control over dangerous pollutants, or management of nuclear waste should be decided, in detail, by legislators? Obviously, decisions of this kind have to be delegated to qualified experts. The notion that they should be decided instead by people whose main qualification is slavish fealty to the big boss is absurd.

The reality is that these “reforms” have nothing to do with making government more efficient. The goal is rather to make “Mump” all-powerful. The game was given away by JD Vance himself who said that if Trump were to win the presidency again in 2024, he should “fire every single mid-level bureaucrat, every civil servant in the administrative state, replace them with our people . . . And when the courts stop you, stand before the country like Andrew Jackson did and say ‘the chief justice has made his ruling. Now let him enforce it.’” So much then for the notion that the US is to be “a government of laws, not of men”. This is a coup.

This effort is not going to transform public finances either. In the 2025 fiscal year to date, 78 per cent of federal spending is on social security, health, defence, income security, veterans benefits and net interest. Musk says Doge can save $2tn annually. With spending of $6.8tn last year, this looks absurd.

In sum, one does not make a complex system more “efficient” by hacking away at it at random. But one can terrify its employees. Thus, the true aims, as Anne Applebaum notes, are intimidation and replacement of genuine public servants with acolytes. The benefits of this are clear: it will allow those in charge to use the powers of the government to prosecute “enemies”, intimidate journalists, spread lies, ignore science and assail disobliging state and municipal governments, if necessary by force. And what about the rule of law? Vance has already said what he thinks of that idea. The aim, then, is to turn the US into a plebiscitary dictatorship, in which the holder of power is king. Will this revolution be compatible with fair elections in future? One must doubt it.

After all, much of this will be irreversible. Once loyalty has replaced integrity and lies have replaced truth, it will be a long way back. Thus, once you have sacked competent and honest public servants, how easy will it be to find similar people in future? US intelligence services, data and scientific analysis were global beacons. How much of that will survive? One of the tests for employment is to be whether one embraces the lie that Trump won in 2020. Only careerists and Maga fanatics are likely to concur.

If the sort of state that Fukuyama praises is replaced with what is now intended, a poisonous blend of incompetence, predation and corruption is inevitable. Among the damaging features will be what Daniel Kaufmann, senior fellow at the non-profit Results for Development, calls “state capture” — the exploitation of power by those who are able not just to bend, but to create, rules for their own benefit. For a high-income country, the US is already relatively captured. But it is about to get worse now that rules protecting the independence of civil servants are to be ended.

What is happening is destruction, not reform. Whatever they have been told, ordinary Americans will not benefit from the chaos. But we know who will.

martin.wolf@ft.com

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