Dredging Up the Submerged State: How Democrats Lost Their Nerve

Nov 14, 2011Mark Schmitt

The greatest obstacle to a New Deal-worthy response to our current economic crisis is Americans' distrust of government. But what causes that distrust? Is it just bred in the American spirit, from the Founding Fathers? If so, how were FDR and his successors able to overcome the distrust and bring newfound powers of government to bear against an economic crisis? Is it just propaganda carried over from the Reagan era?

Last year, a fresh answer emerged in a couple of articles and now an important book, The Submerged State, from Cornell political scientist Suzanne Mettler. Mettler showed that Americans distrusted government in part because, unlike in the New Deal era, they don't see or feel what government does. We've created programs that are so complicated, vague, and nuanced -- tax credits and public-private partnerships -- that many of their beneficiaries don't know that they are benefiting from government at all. Mettler's analysis has multiple implications: We have to call attention to the purpose of government and how programs like student loans help to achieve it, but we also need a new approach to the structure of government and a willingness to move decisively and visibly on big public missions.

I reviewed The Submerged State in The New Republic in October, and have subsequently had the pleasure of asking Suzanne some questions about her new book. The answers will appear in a question-and-answer format, expanding on points in the book, over the next few weeks.

Mark Schmitt: In your wonderful book, you show how the "submerged state" programs of the current era, like the tax credit for education savings, are invisible to their beneficiaries, thus fostering their feeling that government does nothing for them. You draw a contrast to older programs like Social Security and the GI Bill that recipients knew about and could feel. Most of the New Deal and Great Society programs were much more visible. How do you explain that? Was it that FDR, Harry Truman, and Lyndon B. Johnson were smarter about creating programs that people would appreciate? Or were those just simpler times?

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Suzanne Mettler: Social welfare policies created as part of the New Deal and Great Society did tend to feature a more visible role for government, for various reasons. Presidents Franklin D. Roosevelt and Lyndon B. Johnson benefitted from large majorities of Democrats in Congress, so they more often had the political clout to enact policies with designs they favored. The policies of the submerged state, some of which date back to the early and mid-twentieth century, were typically promoted by Republicans or by conservative Democrats who favored arrangements that worked through market mechanisms rather than government bureaucracies. In addition, submerged policies often emerged as the fruit of compromises with powerful interests -- groups who would only support reform if it channeled funds in their direction. This is exemplified by the creation of bank-based student lending in 1965.

In the period of conservative governance that the United States has experienced since 1980, creating and building the submerged state has become a bipartisan affair. Such designs appear, at least at first blush, to embrace the market-based priorities of this period, the view that the private sector does things more effectively and efficiently than government. In reality, submerged policies are antithetical to genuine laissez faire principles, because they actually intervene in the market and channel government resources to promote particular industries at the expense of others.

In addition, as partisan polarization has escalated, submerged policies have grown more attractive to Democrats because they offer a more politically feasible manner of channeling resources to low- and moderate-income people than the creation or expansion of direct policies. This is the case not only because conservatives are more willing to support them, but also because they encounter fewer procedural hurdles in Congress. They are not subject to the public glare and multiple veto points of normal budget items, and once enacted, they can grow automatically and are not subject to annual appropriations.

Mainstream Democrats have increasingly come to recognize that such policies poll well. This point is explored in fascinating new research by Jake Haselswerdt and Brandon Bartels, discussed recently at The Monkey Cage, and by Kevin Drum at Mother Jones. But contrary to Drum's conclusion that these policies show "how to fool conservatives into spending money," in the longer run it is liberals and moderates who are shown to be the fools for embracing such policies. As I show in The Submerged State, government's role in such policies eludes Americans, including even the beneficiaries. This makes it possible for people to become increasingly indifferent or even hostile to government, not recognizing that it is the source of policies they depend on. In turn, it prevents people from mobilizing to support reforms to address the major social problems that concern them.

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