The American Interest
The Middle East & Beyond
Published on February 6, 2013
What’s Wrong and How to Fix It, Part 10: Institutional Reform

Having put in place a way to do it, we must pursue a range of institutional reforms.

Were we to institutionalize a periodic governmental design review, among the first candidates for reform, among a great many, should be the following:

Redesign the Department of Homeland Security

The creation of DHS was not a conceptual mistake, as some have claimed, but it does reflect a design mistake. The original Hart-Rudman DHS proposal was to amalgamate three relatively small agencies—the Border Patrol, Customs and the Coast Guard—into one new Executive Department, and bring FEMA in, as well, to serve as its organizational framework. FEMA always had a small Washington footprint, with most of its assets pushed out in its ten regional centers, close to where problems and their first-responders were. The idea was to create a DHS that, like FEMA, had a small Washington presence and that pushed resources and responsibilities out to the regions. This was subsidiarity and common sense at work.

There was no good reason to make DHS more centralized than that, anymore than, on the foreign policy side, the NSC needs to swallow the Defense and State Departments and the intelligence community. There would be an EOP (Executive Office of the President) office for domestic security comparable to the NSC, and the new Executive department, DHS, could be comparable in size to, say, the Department of Education, or maybe even smaller.

That’s not what happened. There is an EOP office for homeland security, but DHS as it exists today is a bureaucratic monstrosity, a slow and ponderous behemoth that has not a hope in a million of operating within the decision cycle of terrorist adversaries who want to strike us in our homeland. It has swallowed other agencies whole, and buried them beneath multiple layers of bureaucracy.

Even so, DHS does not control more than 25 percent of what the government spends on homeland security, and the Administration that created it soon took its central function—connecting the intelligence dots to prevent another 9/11—and gave it to an arm of the new Directorate for National Intelligence. DHS is a textbook case of how not to align strategy, resources and operational capacity.

DHS is also understaffed for the scale of its responsibilities, so that it relies overwhelmingly on contractors. As a result, the Kettl syndrome of unaccountability described above runs wild.1 This shows what happens when people who don’t really believe in government in the first place design a new department or agency. DHS today is not reformable any more than it is manageable. It needs to be ripped apart and reconfigured according to the original Hart-Rudman Commission design. As it stands now, DHS is more of a liability to our security than it is an asset.

A national institution to control biotechnology

American society is the most history-oblivious, optimistic and market-oriented ever to exist on this planet. For the past century and more, we have been conducting a totally unregulated experiment in the sociology of science on ourselves. Build railroads all over the place if we can? Sure, and who cares what the social, economic and legal implications might be. The internal combustion engine and the interstate highway system? You bet: Pollution, congestion the sociology of suburbia—who would have thought? Television? Right: What harm could that possibly do? Birth control? Yes, indeed, and don’t look back. The Internet, BlackBerries, a cell phone that can double as a toothbrush in a pinch? Um….

Americans commercialize everything our best minds (and our other minds) can invent, let the market take its natural course, and ride each great successive wave of stability destroying innovation all the way to the beach. Then we shake our hair dry, take a deep breath, and run back out to catch the next wave. It’s only as an afterthought that most of us ever ask if these changes have been worth the costs. Maybe they have been; only Luddites and other hopeless romantics oppose human ingenuity and progress. But not to even wonder about the question is passing strange. It’s like habitually jumping off the high dive without looking to see if there’s water in the pool just because you like the sensation of hurtling through the air.

Only once in American history did it occur to us to ask whether the government might not have some obligation to think through the consequences of a new technology before letting the market run wild with it. That was with nuclear energy, right after World War II; we created the Atomic Energy Commission to deal with it. Well, contemporary biotechnology is at least as fraught with potential for monstrous abuse today as nuclear energy was in 1946.

So what have we as a nation done about it? Basically, nothing—even as other countries, and the EU as well, have recognized the potential danger and have begun to act. All we’ve done is assemble groups of bioethicists to ruminate over the matter, while dangerous problems and horrific legal precedents have already been set. Leaving this technology to the market has resulted, among other things, in untutored judges ruling that human genes can be patented and owned by corporations. The justifiable rights of proprietary research aside, this is outrageous, an abomination to the very spirit of our humanity. We must overcome our cavalier approach to arguably the most momentous danger of our century. We need the equivalent of the AEC for biotech, and we need it now.

 A Federal ban on funding public education from property taxes

Subsidiarity is, as I have argued, generally a good thing—but not always. There is one public policy domain in particular in which more Federal involvement of a specific kind is in order. A governmental design review would flag that anomaly, with any luck at all. And that concerns public education, a domain that has long been very much a sub-Federal zone of governance in America. Why? Because my proposal here would increase social capital and social trust on a local and, ultimately, a national level.

Most Americans do not realize it, but our country has gone backwards over the past twenty years in terms of residential segregation, although the site of that resegregation is more suburban than urban.2 Our public schools still do not provide a level playing field for our children largely because of it. Let me mince no words here: Black incomes on average are lower than white and “other” incomes, and most majority-black neighborhoods are poorer than most white neighborhoods, even when both are in suburban districts. Since most public education is funded mainly from local property taxes, that helps explain why schools in predominantly black districts have a smaller resource base with which to fund education. That contributes at least some to inferior education, which in turn reinforces the pattern of relatively lower black incomes, which leads back around the circle of causality to their living in poorer neighborhoods with poorer schools, and so on and on it goes. This causal cycle is inherently unfair and should be unacceptable to any nation “conceived in liberty and dedicated to the proposition that all men are created equal.”

That said, per capita spending on students explains a lot less about educational outcomes than many observers claim, despite the fact that poorer students usually do need and deserve more help because of outside-of-school conditions that affect their readiness to learn.3 Nor can a truly level playing field be guaranteed for all students even at the young age of six years, because by that time many forms of inequality, cultural and social, are already in play. We can spend a veritable fortune per student, but if children return to homes where adults do not engage them in articulate conversation from a young age, where learning is not valued for its own sake, and where adults are not typically seen reading, it won’t matter most of the time. Educational aptitude is a matter of culture more than it is of either nature or nurture, narrowly defined, and there is a limit to what any liberal democratic government can do about it.

Still, public policy in a liberal democracy must concern itself with issues of basic fairness, and it is very unfair that schools for some of our families are structurally under-funded compared to schools for others. That this unfairness breaks down largely along racial and, in the case of Hispanics, ethnic lines is a national scandal of which we should all be ashamed. Our schools are still separate and unequal going on half a century after Brown vs Board of Education.

Of course, the Federal government tries to smooth out inequities caused by funding education through property taxes with offset payments. Some city school districts, Philadelphia, for example, have more complicated funding mechanisms not based exclusively on property taxes. This smoothing process does not work that well, however, and even if it did, it is still wrong in principle to fund public education, an equal opportunity right for everyone, with a vehicle than cannot by its very nature ever be equal: property taxes.

Besides, there is no logical reason why funding for education should not come out of the same general pool of tax money that pays for other public services. Congress should therefore ban the financing of public education from property taxes, period.

Some might argue that there is no need for Congress to act since the courts in many states already have done so, explicitly declaring that funding public education by property taxes is unconstitutional.4 But unfortunately, state administrations have generally been able to evade court orders to change the system, and one of the reasons is the state courts’ lack of power to raise genuinely punitive or criminal penalties for non-compliance. Only a Federal law could have enough teeth to change the balance.

A Federal ban would have several benign effects. First, it would probably reduce property taxes in most places, which would aid home-ownership levels even if other sorts of fees and taxes might rise to offset the revenue loss. Second, if all services are funded out the same general revenue pool, it would force communities and their political leaders to make more explicit choices about how important education is to them relative to other services. Then people could choose neighborhoods and school districts based on quality, not on de facto racial criteria and the machinations of real estate shysters. This would, over time, probably reduce residential segregation and increase spending on education, although, to be honest, lots of other factors play into this equation. Fairness would win, and American society would win.

Past Entries:

Part 1: Introduction, and Globalization/Automation

Part 2: Political/Institutional

Part 3: Corruption/Plutocracy

Part 4: Television and Politics

Part 5: The Financial System

Part 6: Tax Reform

Part 7: Health Care

Part 8: Repeal the 17th Amendment

Part 9: Government Design


1Note the frightening description of DHS’s “fusion centers” in a Congressional research report summarized here. According to the report, around $1.4 billion fusion center dollars cannot be accounted for. This hemorrhage of public money is very similar in its basic source to Amtrak’s losing money selling food to a captive clientele, only on a truly huge scale.

2Note Erica Frankenberg and Gary Orfield, eds., The Resegregation of Suburban Schools.

3See Rhena Catherine Jasey, “Still Separate and Unequal”, The American Interest (September/October 2012).

4See Michael A. Rebell, “The Kids Are Not Alright”, The American Interest (January/February 2011).


  • John Barker

    Thanks for your remarks about the funding of public education. Tomorrow, I will be attending a conference where I will be told that all high students must take calculus and chemistry in a state near the bottom in per student spending and achievement,with inadequate funding for textbooks and teacher training. Reform, I am told, can be accomplished by increasing “rigor”. Not by the futility of increased revenues for schools.

  • Pave Low John

    “American society is the most history-oblivious, optimistic and market-oriented ever to exist on this planet.”

    Unfortunately, that remark about being oblivious to history is 100% correct. I’m currently in the graduate school for a medium sized 4-year university, working on my M.A. in European History and it is shocking to me how little U.S. citizens working towards an advanced degree in history actually know about international history. I’m not talking about any in-depth analysis, just basic information, such as geography.

    Granted, I have an advantage from traveling around the world for 20 years courtesy of the DoD, but I am constantly amazed about how much basic information they lack about non-U.S. cultures and nations. Basically, if it didn’t happen in America in the last 200 years, it really doesn’t matter to the vast bulk of graduate school history students. I can only imagine what it is like at the undergraduate level.

    I told some of them to read the articles on Algeria and Mali that Dr. Garfinkle posted, but I wouldn’t bet too much money on that happening.

  • Anthony

    As politics is the area productive of public policy, perhaps the troubles of the country trace back to politics. While institutional inadequacy is involved, your essay indirectly points spotlight on an electorate generally unable to understand and use the democratic system offered – E Pluribus Unum.

    “Human life, in truth, is less an affair of institutions and systems than of people and an interplay of motivations and abilities.”