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The Fifth Risk: Undoing Democracy
by Michael Lewis
(Allen Lane, 2018)

There are sins of omission as well as sins of commission, right actions that were not carried out as well as wrong actions that were. The things we don't do, say as much about our characters as the things we do. Michael Lewis's short book, The Fifth Risk, tells what might happen when, owing to negligence or inattention, many of the good works of government are left undone.

The book opens in early 2016, with Chris Christie (then Governor of New York) persuading Donald Trump (then contesting the Republican primaries) to hire him to lead his transition team in the event that he won the race to become President (which, in due course, he did). Trump did not want to spend any money on a transition team, but on learning that it was a legal requirement he did so grudgingly. Immediately after the election, he fired Christie and ran his own rather unconventional transition process. Trump's attitude his lack of understanding of what a transition plan involved, his expectation that he would not win and therefore would not need a plan, and the sorts of people he appointed, slowly and haphazardly, once he had been elected forms the backdrop to Lewis's argument, namely that the poor management of government agencies and their activities constitutes a major risk, although one that is not widely appreciated.

Lewis's account of what the US government does and the price that might be paid by its citizens if it performs its role badly (or, perhaps, not at all) is set out in three chapters, each of which take a similar form. He picks a government department in turn, Energy, Agriculture and Commerce describes the range of activities that it performs, including some which don't obviously fit with its name. He interviews people who have held senior positions in the department, whose work over many years has made a substantial contribution to improving the life and well-being of America's citizens, and he reports their fears and disappointments at the quality of appointments made by the President Trump, generally of people highly unsuited to the new responsibilities they have been given.

In the course of the book he describes the work of clearing up the nuclear waste stored underground at Hanford (WA), the operations of the Rural Development Bank that makes low interest loans to businesses in rural America, and research into ways of forecasting the precise route of tornadoes. Much of this work is clearly of benefit to the quality of life of many ordinary American citizens, but many of these beneficiaries are not only unaware that this work is carried out on their behalf, but they are hostile to the idea that the agencies of the Federal Government might be funding activities that help them. They believe government to be the problem, even when it is obviously the best provider of the solution.

What if this work were no longer done, or if the funding for it were cut back such as to render the work significantly less effective? The answer is that very few people would notice in the short term. However, just as physical infrastructure that is poorly maintained eventually fails, sometimes with disastrous consequences, so too a steady decline in the quality of project management of risks which only the government has the resources to deal with, increases the likelihood of a major catastrophe, or several minor catastrophes. Likewise, the failure to support early-stage investment in new technology, such as renewable energy, delays the arrival of better products to market, thereby denying consumers improved choices, It also allows other countries the opportunity to achieve a dominant position in the market for new technology.

Lewis's book tells the stories of people who have devoted their working lives to improving the well-being of their fellow citizen; of people who have put "the mission" before "the money". These are intelligent, highly motivated people who have taken the idea of public service seriously, and who now find themselves let down by a President who rather obviously doesn't care to understand what public service means and why it matters.

Nonetheless, the book left me with two worrying thoughts. First, Trump's ineptitude due to his ignorance, which makes him over-confident about his own abilities has made him an ineffective President. If he were smart, hard-working and knowledgeable about how to implement his political agenda, imagine how many bad things he could accomplish in four or perhaps eight years? His sins are mostly of omission, because he is too foolish to make the government machinery work well.

Second, the ignorance of political leaders is distributed across the party lines. In the US, several of the Democratic contenders to become the candidate to face Trump in the election due in November 2020, have produced policy platforms which pay no heed to intelligent advice from non-partisan experts about the risk of sins of commission. They seem not to care at all about deficit budgets, health-care costs, and the probable unintended consequences in housing, higher education and labour markets of substantial new government regulation of prices. Much the same can be said of the UK where, in the election last December, it would be hard to claim that the policy platform of the Labour Party was any less fantastical than that of the Conservative Party. Irresponsible policy proposals are, today, ubiquitous.

Michael Lewis is persuasive about the long-term risks that modern democracies face if they neglect to manage the many, complex tasks of government carefully, and if they ignore the wise advice of the government employees who have devoted their lives and skills to solving intractable public policy issues. His immediate target is fair game there is no doubt of that but what is much more worrying is the extent to which President Trump is representative rather than exceptional.

© Mark Hannam February 2020