Tuesday, July 9, 2019

"No One in Ohio Cares About Burma": The Washington Bubble

Less than 600 Federal employees are directly accountable to the voters.  Almost a half million Federal employees live in the DC metro area and are accountable to someone who lives in the DC metro area.  Naturally, Federal agencies are sensitive to media coverage, and journalists and think tanks covering Federal matters also disproportionately live in the DC metro area.

This results in groupthink, a.k.a., the Washington bubble.  Groupthink results in unnecessary errors, of which being surprised by the 2016 election is the most famous instance of a large sample.

Both General Kelly and Mick Mulvaney encouraged EOP staff and agency leadership to spend time outside the Washington bubble.  E.g., holding policy events outside the bubble, or even going to the site of a Presidential rally.  CEA’s high turnover helps too, although professors living near DC are disproportionately interested in taking a CEA position.

I went home to Illinois every other weekend and immediately noticed the contrast.  Here are three examples drawn from those trips.

The opioid epidemic.  Between 2009 and 2016, there were over 100,000 U.S. overdose deaths involving illicit opioids (especially illicit fentanyl).  I have been to funerals in Illinois where overdose was the cause of death.

Yet, in the Washington bubble, attention to this subject was low.  The CEA published 16 Economic Reports of the President during the Bush and Obama Administrations, and none of them mentioned opioids, overdoses, or heroin.  By comparison, the 2013 Economic Report of the President had a full chapter on climate change.  (That attention to the opioid epidemic changed beginning with President Trump's CEA).

I’ve read two memoirs from staffers in the Obama White House.  Rhodes’ memoir mentions climate change 21 times (Trump is mentioned 95 times) but never the opioid epidemic.  The 2016 meeting between Presidents Obama and Xi receives a lot of attention in the book because climate change was discussed, but no mention of the Chinese production and export of illicit fentanyl (fentanyl was a topic of the meeting, but apparently not important enough to explicitly appear on the White House fact sheet, which did mention space debris and protecting elephants). 

(A related film that also features Samantha Power and Susan Rice also has a lot of climate change and zero opioid epidemic).

Pfieffer’s memoir mentions climate change 9 times (Trump 303 times) but never the opioid epidemic.  (The "fact-checked" memoir does find space to declare that, with President Trump, we staff "wander[] the halls of the White House doing dumb, mean, s[]t"). 

In contrast, the memoir Hillbilly Elegy -- cited by the New York Times as one of "6 books to help understand why Trump won" -- mentions climate change zero times and (in some detail) the opioid epidemic ten times.

To be a bit more systematic about this, I looked at google trends for “fentanyl” and “climate change” state by state over the past 5 years.  The results are well summarized by comparing Ohio and DC, both of which had age-adjusted overdose death rates of 39 people per 100,000 in the year 2016.  By this metric, Ohio's attention to fentanyl was more than triple DC's, as shown in the chart below.






Wage stagnation.  Last summer the bubble’s economic meme was that real wages had “stagnated”: that is, since 2016 (if not longer) worker’s wages had not advanced beyond inflation and that workers were suffering from “feeble bargaining power.”

Meanwhile back home I was seeing more striking workers than I can ever remember.  Is that what feeble bargaining power means?  Local friends and neighbors asked me “I read/heard about this ‘wage stagnation’ stuff – why aren’t I seeing it in my line of business?”

CEA had been working on a report about measuring wage growth, using the economic literature on how to do such things.  The report showed that wages were growing significantly more than inflation; the groupthink was wrong.  More surprising, some of the perpetrators of the groupthink acknowledged that they had suspected that real wages were growing but for some reason did not speak up about their understanding until CEA’s report was published.  (The charitable interpretation is that, living in the bubble, they viewed it as too risky to say what they knew until CEA offered more evidence as protection).


The cost of an American lifestyle in a Nordic country.  As part of its work on socialism, CEA looked at the costs of living an American lifestyle in a Nordic country.  Part of the American lifestyle is driving a vehicle.  Because the top three selling vehicles are pickup trucks (I see them all the time at home), our October socialism report looked at the cost of owning and operating a pickup truck in Nordic countries.

That was a mistake (entirely mine).  Although the President’s speeches (which rely on some of CEA’s socialism findings) are for the entire country, CEA reports are primarily read inside the Washington bubble where pickup trucks are objects of derision.  So the subsequent Economic Report of the President's socialism chapter deleted all references to pickup trucks and change the analysis to a Honda Civic.


Much of the public has an interest in bringing outsiders into elected Federal offices.  While an outsider can initiate important changes, he still has the challenge that much of the Federal manpower lives and works in the Washington bubble, if not originating from it.

Many among the UNELECTED in the Washington bubble are unaware of the gaps above, and at best dimly aware of any gap at all, between them and the rest of the nation.

Take Ben Rhodes (unelected), who had to be repeatedly reminded by (elected) President Obama that "no one cares about Burma in Ohio" (pp. 174, 390 of Rhodes' memoirs).  Mr. Rhodes absorbed the lesson well enough to italicize it in his book, and well enough to recall that candidate Obama himself ran against the DC bubble (p. 403), but not deeply enough to think about gaps such as those mentioned above (or the economic damage from Obamacare, historic regulatory overreach, etc.) that in principle his party could manage.  Even with a year of reflection, the best he can discern is that his party lost the White House and both houses of Congress primarily due to "racist, mean-spirited, truthless politics" (p. 401).

The best Dan Pfeiffer (p. 95) can discern is that technological change in journalism created an environment where a purportedly unqualified outsider could win a Presidential election.  Pfeiffer does perceive that the economy may be one issue among many (pp. 269-71), but only regarding economic messaging; there were no policy mistakes between 2009 and 2016 that caused significant and genuine harm to voters living outside the Washington bubble.

There is a London bubble too, with a large gap in perspectives between those living in the London metro area and those living elsewhere in Britain.  Sir Kim Darroch invited me, several White House staffers, and many others from DC to an April event at the British embassy with Phil Hammond as guest of honor.  I was shocked that the public remarks were so straightforward as to their continued disdain for UK and US voters' decisions, almost 3 years past.  I expected that Darroch and Hammond would have short political life spans but not so short that Darroch would enter political intensive care already today.

As the Spectator put it,
"This high-handed [policy-making] process relieves us of the burden of thinking about what our rules will do to individuals on the receiving end. In its own way, this is a species of dehumanisation; when people rebel at the ballot box, we are shocked."

[My experience at the Irish embassy was entirely different (a smaller group with Finance minister Paschal Donohoe and Ambassador Daniel Mulhall).  Although preferring that UK remain (Ireland is part of the EU, so exit would put an EU-nonEU barrier on their island), these smart, thoughtful people understood why many British would want to Brexit.  Perhaps there is no "Dublin bubble"?]

Consider it good news for US political outsiders that the Washington bubble shows little sign of adjusting its outlook.



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