Rebuilding American Institutions - The outline of a plan

Our governing institutions are unable to face the biggest challenges of the 21st century. It's time to build new ones. The purpose of this essay is to lay out what it will take to build these new institutions.

In 1962, John F. Kennedy gave his famous speech 'choosing to go to the moon'. In 1969, seven years later, America landed the first manned craft on the moon. Getting to the moon was a monumental feat. It required developing dozens of new technologies and coordinating hundreds of thousands of people. Funding for the Apollo program peaked at 2.2% of annual federal expenditures.

NASA claims they are going to return an astronaut to the moon in 2024. The technology already exists. Yet it seems unlikely they will accomplish their stated goals. As Robert Zubrin argues, the manned spaceflight program has become constituency driven, rather than mission driven.

I do not mean to pick on NASA as it is hardly unique. Going to the moon just happens to be a clear symptom. The underlying sickness, which has afflicted most major American institutions, is decay. American state capacity has declined over the last two generations, and American institutions are no longer able to effectively complete tasks, they have become stagnant, happy with their rent streams, and unable to innovate.

This is not limited to government. Take journalism for example. There is declining trust in journalism as an institution. A more visceral example is the former Editor in Chief of the New York Times being credibly accused of plagiarism. Top universities, including Yale, were taking bribes to allow applicants spots on sports teams which would guarantee admission. More generally, Patrick Collison and Michael Nielsen argue that scientific discovery has slowed down.

While this would be a challenge in normal times, we are not living in normal times. For the first time in over a century America is facing a geo-political rival, China, with industrial capacity comparable to our own. We are facing internal divisions not seen for 50 years. Our economy is increasingly concentrated in superstar urban areas. We have an aging population with below replacement births.

Our governing institutions are unable to face the biggest challenges of the 21st century. It's time to build new ones. The purpose of this essay is to lay out what it will take to build these new institutions.

First, it is important to describe the current role of various governing institutions. The ecosystem in DC is relatively simple. There is the government. Each administration makes around 4000 political appointees. These political appointees serve to implement the vision of the administration. They work in the White House, or are senior administrators in various government agencies. Many political appointees come from think tanks, with other sources being universities and businesses. Think tanks can, to a certain extent, be thought of as holding pens for administrators when their party is out of power.

The challenge is that think tanks, universities, and banking (the business where most political appointees are drawn from), are themselves in various states of sclerosis or decline. Their funding comes from established organizations. The existing networks are strong and loathe to admit mistakes. They have figured out how to keep power and don't want to let go. As such, the function of DC institutions is to prevent change and keep the rents flowing.

The result is that even if a candidate comes in wanting change, they are unable to implement it because the talent pool doesn't exist. In DC, most people I chat with under 30 realize the house is on fire, while most over 40 are just starting to smell the smoke, or think the fire can be put out. The younger generation is being trained and integrated into the networks of the older generation, and as they gain seniority, will have little incentive to rock the boat.

Attempts to draw outside existing institutions for appointees have met limited success. Peter Thiel, one of Trump's most prominent supporters, tried to get a colleague, Jim O'Neill, appointed to Commissioner of the FDA without success. New York banks, on the other hand, seem to fill every presidential administrations treasury department. Given that Silicon Valley is the most dynamic region of the country, it's unfortunate they haven't been able to get similarly senior appointees. Marc Andreessen would be a more consequential cabinet member than Jacob Lew.

Rebuilding America's governing institutions requires first building new training grounds. These training grounds include think tanks, educational establishments, magazines, and cultural influencers that recognize the magnitude of the challenge and are dedicated, not to reviving the lost center, but developing new ideas for the challenges of the 21st century.

One of the things Silicon Valley does well is empowering young talented people. A number of institutions, including the Thiel Fellowship, Pioneer, 1517 Fund, and Y Combinator are to varying degrees targeting young people with ideas and giving them the knowledge and resources to be able to execute. DC, on the other hand, doesn't empower young people to build things. Instead there are various fellowships and opportunities teaching you how to climb existing ladders. Building the institutions of tomorrow requires identifying these talented people and empowering them.

Of course, there are key differences between Silicon Valley and DC. Successful startups in Silicon Valley create huge amounts of wealth which justifies the investing ecosystem. No one would call think tanks or magazines lucrative. The success of non-profits is also inherently more difficult to measure than for profit companies. Lastly, ideological institutions are inherently more tribal than tech startups, increasing the costs of switching employment.

These challenges don't mean there isn't room for improvement. Key factors that can contribute to the success of new governing institutions include 1) raising the status of founders, 2) creating a network of mentors and advisors to help simplify the process, and 3) developing consistent funding streams to develop the successful projects.

Founders in Silicon Valley are high status. That isn't the case in DC where there is a degree of suspicion in people who start their own thing. The implicit question is, why couldn't you cut it at AEI or Brookings? Founders in Silicon Valley also face limited career risk. If your startup fails, it's relatively easy to get a job at Google or Facebook. In DC it's more difficult to find a job if your startup doesn't work out, particularly so if you're challenging the status quo. Changing the status of founders would allow early stage career people in the policy space to take risks starting new organizations. Not all would succeed, but only a handful would need to in order to justify the risk.

One of the advantages of Silicon Valley is that there exists a network of mentors who have similar experiences to you. If you're building a company, your friend group often has a handful of people who are one or two stages later than you and to whom you can lean on for advice. That isn't the case in DC. The support network for founders is limited, increasing the challenge of building something.

Lastly, Silicon Valley has an extensive network of funding streams for startups. While there exist funding mechanisms for non-profits, most of them are tied to existing systems and uninterested in funding new ideas. Most foundations, for example, have relatively stringent reporting requirements that are difficult for early organizations to meet. Building new institutions requires a new class of funders who understand the problems America is facing and are willing to take risks in order to fix them.

There are bright spots. I've had conversations with folks interested in creating new institutions for scientific research and developing an organization dedicated to a realist foreign policy. I'm on the board of RadicalxChange which is thinking seriously about how to reshape our social order. Tyler Cowens Emergent Ventures is funding more radical ideas at earlier stages. However, taking these conversations from ideas to execution requires work and changing the way we think about new governing institutions.

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