0:33 Intro. [Recording date: June 16, 2016.] Russ: Now this is an ambitious book that tries to analyze where America has been, where it is now, where it might be going. I found it very thought-provoking. Let's start with where America is now. You argue that both Republicans and Democrats suffer from a nostalgia for the past. Explain. Guest: Well, that's right. So, the book begins from the intense frustration that is overwhelming our public life now in America. And it's so evident in our politics in so many ways. One of the things you'd want to do to understand that kind of frustration and its sources is really to listen to how it's expressed in our politics. When you listen, you find that our political life is just drenched in a kind of nostalgia--in a very widely shared sense that America is not what it used to be; that's another way of expressing a lot of the slogans you hear in our politics--and that we've lost ground fast from a peak that a lot of Americans can still remember. And exactly where you put that peak does vary some from Republicans to Democrats. For a lot of people on the Left, that peak is really mid-century America, in that moment when we had enormous confidence in large institutions, in big government, in big labor, in big business to solve the kinds of challenges we have alongside a liberalizing culture. There are some people on the right who miss that time, above all, also: the New York Times in April asked Donald Trump, 'When was America great?' And he started talking about the 1950s, the early 1950s. For some people on the Right, of course, the time they miss was the 1980s, which was a kind of resurgence of something of that mid-century America but with more of a market orientation and more dynamism. But in both parties on all sides of our politics there's a powerful sense that the recipe for revival is a recipe for return. And very often we find our elections presented to the public as a choice among nostalgias: Should we go back to the economy of 1965 or 1981? Should we take the country back to the Great Society, or to the Reagan revolution? And of course, that makes it difficult for us to confront some 21st century realities. And it strikes the public as disconnected. Because in a lot of ways it is disconnected. So, it's not that there's no place for nostalgia in political life. I certainly think there can be. But the trouble is that our kind of nostalgia is so intense that it blinds us to some of the ways that our country has changes since those times that we miss so much. Russ: Yeah. We could debate where the nostalgia plays out in the most way, you know, given the Democratic nominee being Hillary Clinton--she's going to sell some nostalgia for the 1990s, when growth perhaps was more equal-- Guest: Yep-- Russ: Or times were better. That's a natural political idea. It takes some ideas that we know worked in the past. Maybe they'll work again. I think that sells well with the electorate regardless of how nostalgic they are. But you argue--and this is what's at the heart of the book--you argue that the conditions that made the policies--forget the attitudes toward the 1950s, 1960s, 1980s, 1990s--you argue that the policies that worked well in those times are poorly matched both by Republicans and Democrats, they are poorly matched to the culture and the economy that we have now. [?], and you talk about both. Which is what makes it such an interesting book. So, what has changed since the 1950s, or the 1980s, and maybe even the 1990s that makes those old-style policy ideas likely to be failures? Guest: Yeah. So, in a sense this is why the book is called The Fractured Republic, because what our nostalgia, what the particular kind of nostalgia we tend to be subject to causes us to miss, or to be a little blind to, are some of the most fundamental ways that our country has changed since those times that we miss. And it seems to me that at the core of a lot of that is fragmentation--is the fracture of what was in the middle of the 20th century a very cohesive and consolidated American society. We don't think enough about how unusually cohesive and consolidated America was coming out of the Second World War, after the experience of the Depression; but even more than that, half a century of industrialization, of mass media, of progressive politics left American life intensely cohesive and consolidated and focused on national unity, on solidarity above individual identity and individualism generally. And what's happened since that time is the breakdown of that consolidated culture--the liberalization, we would say in a positive sense, or the breakdown in a negative sense--the culture has become much more fragmented; we have a lot more options, a lot more grooves and channels but much less of a single consolidated culture. Our economy has become much more fractured and fragmented; or in a positive sense, much more specialized--which is really how you build wealth in a capitalist economy. That's a good thing; and we have built a lot of wealth. But it means that there is, as people on the Left notice, much more inequality: that there is, as people on the Right tend to notice, less economic stability, less security. And that's in a sense the price of progress. The kind of ironic truth that it's so hard for everyone in politics to accept, that the book begins with, is that a lot of the problems that we have, the deepest problems we have in 21st century America are at the opposite sides of the coin of the greatest strengths that we have, the things that we like most--they are the price of progress. And so, we can describe our society as diverse and dynamic--and that's true. We can describe our society as fragmented and divided--and that's true, too. But what's really striking is it's all the same truth: we are describing the same thing. We are describing a society that was intensely cohesive and has grown more diverse and more fragmented. And that basic reality is what our politics should be dealing with: the question that our political life should ask itself is: How do you use the strengths of this diverse, dynamic society to address the weaknesses of this fractured, fragmented society? And we're just not asking that question, because we are so nostalgic.

7:29 Russ: So, I want to get you to elaborate on this a little bit--the 'fractured and fragmented' idea--because, you are conservative; and the words 'fractured' and 'fragmented' have a--somewhat, or quite negative connotation. You concede many of the good things. Let me paint a rosy picture for a minute, and let you talk about why I'm over optimistic. So, I don't particularly think of cohesiveness or unity as a strong value. I'm more of a libertarian. And I think liberals have a little bit of a--they are torn between the value and the negative of these things. But let me paint it as a rosy one. Sorry for the long intro. So, since the 1950s, we're a lot more tolerant. We're a lot more open to individual expression. And that's mostly been an overwhelmingly good thing. There's much more opportunity for minorities, for women, for all kinds of different kinds of expression that were repressed in the 1950s and 1960s. And as you concede in the book, a lot of the social movements since the 1950s are a response to that cohesion that you are trying to describe. So, isn't that all good? What's the negative of all this freedom? Which it really is, at the individual level. What's bad about that? Guest: Yeah. Well, absolutely. I try to get across in the book that I absolutely agree, that these are good things. And I think more than that: our economy has a greater market orientation which has made us wealthier, has given us lots more options in every realm of life--which is a good thing. The people who missed the 1950s are not thinking about how constricted our cultural and social lives were in those times. The trouble is there is a back side to these same trends. And so, while it's true that there is less constriction, there is less social pressure to conform in American life, there is also less social order. There has been family breakdown that has tremendously dire consequences for too many Americans. There is less economic security, as we've had more economic dynamism: so, there's less stability, there's less of a chance for kind of lifetime employment of the sort that people talk about when they talk about what they miss about mid-century. So, the good and the bad have come together. And in a lot of ways, the bad is the price we pay for the good. And we don't want to give up the good. So, reversing course, even if it were possible, is not something we would actually want to do. My problem with nostalgia for mid-century or even for the 1980s is not so much that it's impossible to go back--though it probably is. It's also that we wouldn't actually want to go back--that there has in fact been very real progress. And to simply talk about going backward is to deny the reality of that progress. But as we say that, we also can't deny the reality of the price that we've paid. The price that we've paid in the kind of social stability and in the kind of social order and in the kind of economic security--and in the kind of national unity, which I do tend to value more: I'm a conservative. That certainly has been a price we've paid for all of this. And so the question is, how do we, as this society, as a society as diverse as we are, as a society that is as fragmented as we are, how do we address those challenges now? And I think that's the question that our politics has just failed to ask itself, both on the Left and the Right. Russ: Okay; we're going to turn to that in a little bit.

11:06 I want to stick for a little bit with the analysis of the past, though. When I look at the Republican/Conservative policy positions of the last 25 years, I see--it's not so much a nostalgia for the past as a lack of imagination of what might go forward. Guest: Yeah. Russ: So, Republicans talk about smaller government; never do anything to implement it. Their nostalgia, policy-wise, is for lower taxes or lower tax rates in a world where government's getting bigger--which I view as irresponsible and a bit of a sham. Because I believe, as Milton Friedman did, that if you keep making government bigger, you are raising taxes. Period. You are just raising them in the future, because you are borrowing to close the gap today, and you are misleading people when you cut rates. There may be some supply-side effects--I think those are real--but they are small relative to the rest of the story. At the same time, I see--and I think you agree with this--that the Republicans/Conservative groups have lost the moral high ground. They've become the party of No. And they can't articulate a positive vision other than, 'Oh, we just need lower tax rates.' Am I being too uncharitable to the Conservative Movement in the last 25 years or so? Guest: I wish I could say you were being much too uncharitable. I think you are only being a little too uncharitable. It does seem to me that it's helpful to understand how we've come to this place by thinking about it through the lens of nostalgia in the following sense: that a lot of what conservatives have been doing over this period is offering Reagan's prescriptions over and over, without thinking about why those were the prescriptions he offered in the 1970s and early 1980s. And of course the reason they were is they were tailored to a specific set of problems, including high tax rates that seemed to stand in the way of growth; including hyperinflation. And the particular challenges we had--over-regulation of a particular sort, over-regulation of the kind of infrastructure of the economy--specific problems that we had in that moment, that if you were going to apply the general principles, the kind of vision of the good that conservatives bring to bear on public life to those problems, the agenda you would offer might look like Reaganism. The problem is, circumstances have changed. And so, if conservatism is the application of enduring principles to changing circumstances, I think where we've failed in our time is to take cognizance of the changing circumstances; and instead we're offering not enduring principles applied to changing circumstances, but an unchanging agenda that over and over is said to be the solution to whatever is the problem we might have. And over time of course it becomes less and less the right solution. And so to simply try to repeat it and replay it is not the right answer. And it does seem to me that there's a powerful element of nostalgia in the sense that: This is what worked; and so, to offer this again, this is what would work again. You find a lot of conservative politicians including some who are much too young to actually be nostalgic for the 1980s. I think of Ted Cruz in this respect. I have a lot of regard for Ted Cruz, but he did in this election just offer a very vague kind of appeal to the memory of Reaganism as a substitute for a policy agenda for 21st century America. And it's not effective, for one thing, which is important. But it's also just not right--it's not well-suited to the challenges the country faces. And so a 21st-century conservatism would look different. Russ: Yeah; you are really saying that you've got to diagnose the disease correctly before you put forth a cure. Guest: Exactly.

14:56 Russ: Let's--I want to give you a chance to pick on the Left a little bit. So, you suggest that for the Left, the 1960s were in many ways the policy high point: The Great Society, the additions of various--really the underpinning of the current welfare state that we have in America came from either the 1930s or the 1960s. And it continues to be the case that the Left advocates for new national programs that give money or transfer resources in certain ways in certain situations, either because they are poor or they are ill or they need education. What's wrong with that? The Left would say, 'It's been working; we just need to do more of it.' Why is their solution outdated? What's inappropriate about that cure for the current set of illnesses we face? Guest: Well, again, I think that an enormous part of the problem here is a failure to contend with how the country has changed. And so the argument that this kind of centralized model of one-size-fits-all solutions, which is really built, I think you'd have to acknowledge, on the model of a kind of industrial economy approach to public policy, is not a good fit for our post-industrial economy and society. And the core problem with it is that it does not work--that it doesn't work in its own terms; that it's a horrendously inefficient way to achieve the ends that it holds out for itself. And very often it just simply fails to achieve those ends. So it seems to me that what you find on the Left is--in some ways even more obviously a function of nostalgia, where the economic argument of the contemporary Left very often comes down to: The economy has been failing middle class and working class people for 40 years, and what's required is a return to a period before the greater market orientation that we started to see in the 1970s. It's striking the way that they really say that the combination of economic arrangements of the 1960s is the recipe, is the secret sauce for success in America. And that was a highly regulated economy--regulated in a different way than we now think. In some respects the regulatory state is bigger now than it was then, but the economy was regulated at that point in such a way that the fundamental infrastructure of it--transportation, communication, the financial system was tightly controlled at the same time that unions were quite strong; and you had the beginnings of these large social programs that tried to apply in a fairly crude way a kind of recipe from Washington for addressing large social problems. And when liberals today turn to solving problems, they just want to do it again. So, when you turn to the challenges of the inefficiency of the contemporary health care system, a lot of which, by the way, is actually a function of Great Society programs--of Medicare and Medicaid--the solution is literally: Let's find just the right MIT (Massachusetts Institute of Technology), let's make sure he gets just the right definition of health insurance, and then let's require everybody in America to buy what he's selling. That is, to put it mildly, not a 21st century solution to a serious problem we confront. So, you have this sort of desire to return to what was the model the last time the public had a lot of confidence in the Left's way of thinking. I would say, though, in terms of both the Left and the Right one important thing to understand about why we miss those times is that those periods offered a stable backdrop for liberalization. So, what you had in the 1960s was a very cohesive, stable backdrop for social liberalization, in particular, which matters to the Left I think much more than anything else at this point. You had a kind of social infrastructure that was very strong coming out of mid-century--strong families, high marriage rates, low divorce rates. And it created a stable backdrop for social liberalization--for the Civil Rights movement and the Women's Rights movement. And in a sense it's that stable backdrop for liberalizing that the Left now misses. And similarly, the Right--what we miss about the 1980s is the stable backdrop for economic liberalization--for driving our economy in more of a market direction. And of course, you can't return to that. You can't undo the liberalization that has changed the underlying society. But it's not hard to see why we would miss all that. Russ: Well, that liberalization interacts with the culture and there's these feedback loops that I think both the Left and the Right conveniently ignore. To pick on the Right for a minute--I have conservative friends who bemoan the state of the family, the state of marriage; but they are mainly talking about innovation liberalization. They don't seem to have noticed that traditional marriage is almost dead in America. It's at least endangered. I think the numbers that you quote are over 40% of children are born outside of marriage today. Guest: Right. Russ: I mean, that's a social change, it's a social experiment, or however you want to call it. We're going to find out how, we might find out, at least, what the impact of that is. But that's a revolution. That's a silent revolution in a key part of our society and culture that we're going through. And conservatives are worried about the constitutionality of gay marriage--I think they are missing what's really going on. Guest: Well, yeah. I think that in a sense there's a lot of dealing with symptoms, and not thinking about the much deeper causes. In a sense the arguments made about the vision of marriage, the idea of marriage that's presented by the argument for gay marriage is an argument that has to be taken up with--as you say, changes in American life that are half a century old. The beginnings of no-fault divorce--signed into law by the way by Governor Ronald Reagan in California in the late 1960s--already offers you a vision of marriage as basically just a contract; and you might say a lot of the social changes we've lived with since may have been a function of that. But surely if we think about those changes and the costs we've paid for them, we have to think about them as a product of a very long process of really transforming the way we think about some of our key social institutions, a process that people have wanted, very much, for various reasons--that's why it's happened--but at the same time has come with costs. And we do have to confront those costs in their implications.

21:48 Russ: So, I want you to talk about those costs for a little bit. I'll start with what I see as--well, forget the introduction. When I look at what's wrong with the centralized federalized solution, the centralized nation government solutions to poverty, I see them focused very much on material things--income. And you'd say, 'Well, isn't that what poverty is about?' And the answer is, 'Partly.' But I think when people don't have a job, their lives are very different from when they do have a job, when they have a job that's rewarding, not just financial, their lives are very different than when they just have a job that they hate but that pays the bills. And I think the Left has ignored that. The Right doesn't pay much attention to it, either. But the Left has explicitly ignored that in its focus on minimum wage, universal basic income. And similarly, when I think about the changes in the family that we're talking about, on the surface they seem great. What's the big deal? To me, it's like the flip side of the poverty thing: 'We're going to fix it; we're going to give people money. So, we used to have this terrible stigma about divorce, about children being born out of wedlock. We've fixed all that.' What's the downside? Guest: Yeah, and look, I think it comes down to, ultimately--and this is part of the reason that it divides the Right and Left in the particular way that it does--a vision of how you understand society. Of how society has flourished. And ultimately it comes down to anthropology, to how you think human beings flourish. And so it seems to me that poverty, especially entrenched poverty, is unavoidably a function of a combination of economic and social forces. And getting out of entrenched poverty is a matter both of money and of a kind of social order, social structure: it requires stronger families; it requires functional communities. It certainly requires more material resources. The trouble is when you try to solve these problems centrally--when you try to solve them at a national level in a society as vast as ours is--you are going to fall back on purely economic, or that is, purely financial solutions. Because what government can do is send checks. And when it tries to do more than that--when it tries to manage and micromanage--it does it very, very poorly. So that a centralized approach to fighting poverty is either going to consist of just checks, or it's going to consist of very poorly-run social programs. And that's why it seems to me that when we think about poverty, when we think about how to fight especially deeply entrenched intergenerational poverty of the sort that too many Americans confront, we have to think in terms of solutions that work from the bottom up. We have to think in terms of the institutions that are not just the isolated individual and are not just the national government, but stand between the individual and government. Like the family, like the community, like the church and school; like the union, too; and like associations of business people. And like the private economy as a whole. That's how we solve problems in our country. That's how we solve complex problems. And it's much too simple to think you can solve those complex problems by moving money around in a centralized way. Ultimately it requires ways of helping people flourish. And that's why to me those centralized solutions are just not likely to be the answer. Russ: Say something about the family. What's wrong with the family getting a little more liberal--liberated? Less controlling? We get rid of [introduce?--Econlib Ed.] no-fault divorce so people aren't stuck in these dismal marriages; kids aren't growing up homes where parents hate each other. What's bad about it? Guest: Well, first of all it's important to acknowledge that there's a lot of good about it. Right? And so, that it's happened for a reason; and that when you enforce a certain model of the family, you do pay a price for that. And people pay a price in terms of their freedom, in terms of the opportunities that they have; and sometimes there's real oppression that happens; and there's no denying that. At the same time, the family is also the core, fundamental institution of society, the institution that provides us with the kind of security and stability and support and loving guidance that is just essential for people to thrive--especially in a free society where we don't just tell everybody what to do: we expect them to choose to do the responsible thing. Well, how do people come to choose to do the responsible thing? They are formed to become responsible free citizens of a free society, especially and above all, in the family. And so, when family begins to break down, when families don't have the capacity, don't have the resources to provide their members with the kind of support and guidance and moral formation that we ask of the family in our kind of society, then people don't have what they need. They don't have what they need to thrive. And you can measure that economically, where the best predictor of whether you are going to rise out of poverty is whether you live with married parents. You can measure it psychologically; you can measure it socially. There is no question that the breakdown of the traditional family has been an enormous problem for Americans at the bottom of the income scale, and makes it very difficult to get up from the bottom of the income scale. Now that fact does not negate the other fact, which is that the liberalization of family life in America has had positive consequences for many people, too. And so the question is: How do we live with the costs of the kinds of changes that we've wanted? Some of that requires a recovery of a more traditional model of the family. Some of that requires a recovery of the rest of our mediating institutions, finding ways to live with some of the problems that are created by the breakdown of the family. There's no simple formula. But I think we have to be aware of the costs, and aware of the problems. Russ: So, let me look at two areas where I think both Liberals and Conservatives confuse correlation with causation. So, as you pointed out, married families--children brought up in married families tend to do better than those who don't grow up in those families. I would think that encourages people to try to subsidize marriage. Which I think is a misunderstanding of what causation is, there. And similarly, people find that lower-income people have worse health; and they hope that, 'Oh, we'll give them money and they'll be healthier.' And that correlation isn't causal either. There's other things going on underneath. So, ironically, I think the Left looks at money--which is just weird--as a way to fix things; and the Right looks at culture. And I don't think either of those is going to work very well--either of those policies is going to work very well. Guest: Well, I would say what you are describing are both examples of looking at money. So, if the answer to the breakdown-of-marriage culture is to subsidize marriage, you are still looking at money. And it suggests that the reasons people don't get married when they might, have to do with economic incentives and that rearranging those economic incentives is going to cause people to change the kind of decisions they make about that. I think that's just very likely untrue. The evidence we have does not support that view. And we've had some tests of it. In the Bush years there was a pretty significant investment in these kinds of incentivizing-marriage programs of different sorts. I think it was a worthwhile experiment in the sense that it provided a very instructive null result. It achieved nothing. Essentially nothing measurable by social scientists. And it seems to me that a decision about whether to get married is not a decision that you make on the basis of the kinds of economic incentives that you see out of the corner of your eye, that might be changed a little bit by a little bit more money here or there, or changing some of the structure of the EITC (Earned Income Tax Credit). I think those kinds of decisions are shaped by culture, in the sense they are shaped by your understanding of what the natural choice is to make in the situation you are in. Which you form by seeing what other people do, seeing what people who you respect and regard do in such situations; by hearing what it is they say to you about what a good life looks like. It requires functional communities; it requires a functional moral order. And that's why it seems to me that to the extent that there is a role at all for public policy in addressing these kinds of problems--and I do think it's going to be a limited role--it has to play out in a bottom-up way. That is, through the institutions that compose our society, not instead of them or around them. Because it's through the ways we live with these institutions that we make decisions like that in our lives. It's not ultimately about explicit economic judgments.

30:46 Russ: Talk for a minute about feedback loops--interrelationships between some of these problems. So, when the welfare state gets bigger, the private ways we help each other gets smaller. That would be charity; and the family. The incentives to get married get smaller if you don't need a spouse to thrive, economically. And so, to what extent are some of our problems self-created? As an economist, I try to look at underlying economic forces, market forces, either cultural or economic, and the dynamism of our economy--which is mainly a very good thing--unleashes a lot of policy responses that I think often make the problem worse and then create a further demand for why I think we need to "do something". Our education system is a failure, beyond a failure. Aren't these really the root of the problem and almost everything else is just a symptom? Guest: Well, yes; I think so. I would describe the root maybe a slightly different way. It seems to me that a lot of the forces that operate on our society just by virtue of its being a free society are forces that encourage us to think of ourselves as isolated individuals. And so that discourage a way of thinking that understands human flourishing as a kind of social order and thinks instead of the flourishing of the individual. Now, there is a lot of truth in that. And it's really a lot of why our society is as wealthy and successful as it's been. But it can also be a dangerous misunderstanding, especially when it comes to people whose lives are not going well, people who need help, people who are in trouble. Our welfare state has a strong tendency to encourage that kind of isolation, because it unavoidably treats citizens as isolated individuals, and thereby encourages them to become more isolated by creating disincentives to marry, as you say, oftentimes to work. And so really to become integral in larger communities. And so I think there's no question that our welfare state has in some important respects, and this has been well documented for many decades of course, reinforce the kinds of problems that it was actually intended to solve by essentially misdiagnosing those problems, misunderstanding those problems as having to do exclusively with money. But I think there's a deeper issue here that's also been diagnosed for a long time and that really at least as far back as Tocqueville has been a part of how perceptive analysts of American life have thought about society, which is that the tendency to see ourselves as isolated individuals encourages us to think of our society as consisting of individuals and a national government and little or nothing in between them. And that of course creates enormous incentives to increase the size and the power and the role of that national government. That when we confront a problem, we think: How do we solve problems that we can't solve on our own? And the answer is the national government. That's essentially the logic of the second volume of Democracy in America, Alexis de Tocqueville wrote it in the 1830s. And it has really played out in American life in the last century, where a certain kind of Progressive vision of American life has encouraged people to think of our society as consisting of individuals and the state; and government is the name for the things we do together, as Barney Frank famously said. And so we lose sight of those mediating institutions; and when we lose sight of them, we also weaken them. And our individualism and our centralization, which would seem like they are opposites, actually end up reinforcing each other and especially reinforcing one another's worst facets.

34:46 Russ: Let's turn to those mediating institutions because I think most people might not know what you are talking about. So, when you think about--I think you are talking about family; you are talking about the workplace; you are talking about community; you are talking about religion. Guest: If you think about society as consisting of a kind of series of concentric rings, where at the center of it there are individuals, who form families; and working out from there, from the family, you have communities, you have religious congregations and institutions, and you have economic ones like labor unions and business associations; you have the larger free economy in general; you have the states, you have assorted kinds of regional affinities, and you have the national government. And each one of those concentric rings protects and secures the space for the one before it. And so makes possible for people to thrive in that smaller, closer-to-the-ground institution that precedes it. And so then actually government ultimately is there to protect the space in which that whole vision of society exists--to protect the space for people to thrive in those institutions between the individual and the state. That vision of society, that social vision that I would attribute to Edmund Burke, but that's been part of what we might think of as the conservative intellectual tradition at least since the 18th century--that seems to me like how a free society works. And if that's the case then those institutions in the middle--the family, the community, schools and churches, civic groups, the non-profit sector, the for-profit sector, various kinds of associations; and then government--those institutions are essential for our society to thrive. Particularly because it is a free society. Those are institutions where we do things together by choice: not because we are compelled, not because we are ordered, but because we choose to. And that's really where we live as free people. So it seems to me that the health of those institutions is necessarily for the health of the larger society. Russ: So, I couldn't agree with you. The question then is: Aren't you falling prey to the same nostalgia you are criticizing? Guest: Right. Russ: Which is: It would be great to have a world where labor unions, families, churches, synagogues, mosques, schools, etc. were thriving cooperative places that we joined willingly. Those are all dying. We've got a public school system, you've got to be in the neighborhood you live in and the entry price is the price of a house, which is really expensive for a good one, which is a disastrous way to organize the education of the next generation. Our families, we've already talked about. Work is much less secure. So, my relationship with my employer is very different than it was 50 years ago. You want to try to get that back? I mean, I'd love to. I'd much rather have those institutions empowered than the centralized government; and I certainly agree that the increase in the centralization has harmed all those institutions. With other factors, of course. How are we going to get there from here? Or, is that where you want to go? Guest: So, I--rather than wanting to get those back, it seems to me that that's where we want to move forward from here. And the difference between the two is that you have to begin by recognizing the character of our society. It actually seems to me that when you think about the structure, the nature, the character of contemporary society, those kinds of institutions offer a much better path to solutions than the kinds of centralized institutions that people on the Left tend to have as a goal, as a vision. The Left lives with the sense that greater centralization, social democracy, is the future. It is the wave of the future; and when you are on that side, you are on the side of the future-- Russ: That's where Europe is-- Guest: you are not-- Russ: That's the future by definition. Guest: Exactly. So, always, that seems to be where we ought to be headed. It seems to me that that is a particularly anachronistic way of thinking about the future. It's how the past used to think about the future. And the fact that the kinds of changes America has gone through have taken the form of greater fragmentation or greater diversity means that solving our problems now would better function by enabling a great diversity, a great multiplicity of problem solvers in different parts of our society rather than just hoping that one problem solver at the center is going to get things right. So, in other words, I think of subsidiarity or of Federalism or of this kind of decentralization as a form of modernization for America, not as a form of going back but as a form of adapting to how our country has changed in the last century but particularly in the last half century. It's not the case, it seems to me, that mid-century moment that people miss so much was actually a great peak for civil society in America, for the kinds of mediating institutions that I talk about. And if you read the sociology of mid-century America, Robert Nisbet is a great example here. So, Nisbet's wonderful book, The Quest for Community, a kind of call for a revival of these institutions, which feel so current to us now--that book was written in 1953. At a time when we would think of as the peak of those kinds of institutions. And what he says is: No. A half-century of Progressive politics, of centralization of everything, has crushed these institutions; and now they are also threatened by a kind of outbreak of radical individualism that threatens them from the other end. And he was right. I think that's a lot of what's happened. But that's why when we seek solutions--when we seek solutions to the practical problems that we have, how do we address the high cost of health care? How do we think about improving American education?--I think we have to seek those solutions through the mediating institutions. To revive them not by imagining that they are just sitting there waiting for us in the same shape they were in in the 19th century and we can just walk back in, that's certainly not the case. They've been badly damaged and terribly undermined. But in order to solve the kinds of practical problems that we have, the sorts of things that we expect policy to deal with, it seems to me that we need to work through those institutions in ways that will revive those institutions. And so we need a much more decentralized approach to public policy, a much more bottom-up approach to solving problems. I think that's better policy; I think it would be better for the soul of our society. I think it's also just more--it's better grounded in epistemology. We are just more likely to find answers that way than we are by trusting centralized expertise. And so for all these reasons it seems to me that our 21st century challenges really call for a politics of subsidiarity, not as a way of going backward--though certainly we should learn from the best of what America has done and did in the past--but as a way of going forward.

41:53 Russ: It's hard to think about that, though, for me, because I think of that as a cultural problem. And I don't think we have a very good understanding of how to change culture. One way to do it is to write a book, of course, as you've done. I'll just take a couple of examples. A person in an unhappy marriage used to feel courageous going forward, for the sake of the children. And now I think that person feels like a sucker, or a fool. The natural impulse is to think about my own happiness, say, one's own happiness. I'm happily married, by the way--just not worried about my happiness; I think I'm doing good. And similarly, I happen to lead a religious life; but I can't remember a time when saying that felt awkward. So, when I say that on this program, listeners sometimes write me and say, 'I thought you were really smart. Why do you lead a religious life?' And I often respond, 'Either I'm not as smart as you think I am, or leading a religious life is something you don't know fully about.' When I say things like, 'Isaac Newton was religious,' they say, 'Well, he wouldn't be now. Because he'd be smarter. He'd know things that we didn't know.' And I think there's an incredible, among the elites, among the educated, there's a disdain for religion I've never sensed before. There's a disdain for staying unhappily married. And I think these cultural forces are very strong. Maybe there will be a backlash against them. But as someone like yourself as someone who wants to see those attitudes change, how do you start those in process? Guest: You know, in a sense my hopefulness on that front is rooted in my pessimism--in the following way. I think that a way of life that rejects that understanding of what is good, that understanding rooted in family, in faith, and in community, ultimately leads to dissatisfaction--and a kind of dissatisfaction that ultimately is rampant in American life now. I don't think that most Americans today would say that things are going great and they are simply satisfied. When you seek to better understand why and the particular ways in which people who are not satisfied are not satisfied, I think you run into something that's in very general terms could be described as isolation. Or loneliness. I think loneliness is the characteristic difficulty of contemporary American life in something like the way that being hemmed in or constricted or forced to conform was the characteristic anxiety of American life in the middle of the 20th century. And that anxiety led to the liberalization that we're now living with, the liberalization that I've been describing here. It was a response to that sense, that things were too tight, they were too constricted. I think we now live with the sense that we are too isolated. And too far apart from one another. And the way to make it apparent to our neighbors that there is an answer to that problem, it seems to me, especially above all, is just to live that answer. And to live it in thriving communities that are appealing and attractive to people who are looking for something. Now, not everybody is looking for something. A lot of people really are satisfied with their lives as they are, and that's great. I don't think they have to change if that's the case. But a lot of Americans--that includes people who are living in genuine despair and situations of tremendous difficulty and entrenched poverty or other sorts of problems, addiction--but it also includes people who are not but are just unsatisfied. I think that the kind of thriving community life rooted in family, also rooted also in faith that we're talking about here would appeal to a lot of those people as a kind of solution, partial solution, to the sorts of problems, the sorts of anxieties or frustrations that they confront. And so, in a sense, it's because I have a certain amount of confidence that the core vision of the good that seems to me to have made the free society possible is actually true, that I think that it will be appealing, that it will be attractive. If it's not attractive, it's not attractive. But it seems to me that it's not been given an opportunity to show its best self in the situation we're in, because of this century of centralization and then individualism. And because of a politics that is not attuned to the kinds of problems it ought to be trying to solve. Russ: I love that vision, of course. I don't see how the political process interacts with that in a positive way. I see it very negative. So, as there's a push for centralization, as you point out in the book, these intermediate institutions are struggling to survive. Just to take a silly example: When government is lecturing me about taking drugs, it makes it less of a market opportunity for a religious institution or the family or others or some non-profit to make that case; and instead it's always the nanny state that's in loco parentis, that's in the role of the parent telling me what to do. One size fits all. I just think it's a terrible thing. Guest: Exactly. So, it seems to me that changing that is the way in which public policy could play a constructive role. Not that there's a better way to run the Great Society: There's a better way to think about public policy than the Great Society. And that better way would argue for allowing what happens at the level of the community to matter much more. So that when you confront the problem of failed school system, the answer is not just to find a new superintendent, spend a little more money on the schools. The answer is to let parents have a say in where and how their kids are educated. That's one specific example of how this way of thinking about solving problems, both interacts with how we think about economics--it's much more of a market-oriented kind of solution--but also with how we think about the ways that human beings flourish and how can empower the institutions--in this case, the family--but also local schools and communities and civic institutions that might start a charter school and might work to give people options. Thinking about how to solve the problem that way--from the bottom up--seems to me is just a different approach to public policy. And moving from our current approach to that approach requires a lot of politics. It requires political action to change our sort of default assumptions about how public policy ought to work. I think something similar is true in welfare and in health care and really in all of what we think of as the major public problems that public policy ought to be dealing with. In a sense, the problems we have is not that we are not running the liberal welfare state in the right way. It's that we are running the liberal welfare state at all. And so, when consumers just focus on the size of government and give the public the impression that all we really want is a less costly version of the liberal welfare state, I think we do ourselves enormous harm. The problem with government is not just its size, or its cost. The problem with the American way of doing public policy is that it understands its purpose in quite a wrong way. And so, the approach I'm suggesting I think would make for much smaller government, and it would cost less. But what's most important about it is that it is that it would go about solving problems in ways that reinforce these kinds of institutions--and just have a better chance of working.

50:03 Russ: Yeah. Well, it drives me crazy when people on the Right argue that we need smaller government because we need lower taxes, say, or because we need more freedom. Most people don't feel unfree. You could argue it's important. But it's not compelling. It does not convince the skeptic. And I've argued what we need more of is, when we talk about when government gets smaller, what do we get more of? We know what we get less of. We get less government and less spending and lower taxes. But if that's all it is, no one's going to go to the barricades for that better world, except a bunch of rich people who want to see their taxes go down--and that's just horrifying to almost everybody else. So, we need to articulate the vision that you're talking about; and I think it's the right way to go. We might differ on where it needs to be most important or strongest or whatever. Guest: I think, by the way, I think that's a way of thinking about a lot of different kinds of issues, where, a lot of people on the Right get wrong is that we are very adamant about what we want to say No to; but we are not at all clear--and this is true in the social issues, it's true in economic policy and social policy--about what we are saying Yes to. The kind of large, appealing, capacious Yes, for the sake for which some particular No is required. We do a very poor job--we take it for granted--and so we assume that all that's necessary is a kind of defense against evil. But in fact what's necessary is a case for the good. We should not imagine that our neighbors begin by sharing our assumptions about what would be better and what would be worse. We should explain those assumptions. And explain to them why we find them appealing, and why they should find them appealing. It's amazing how little of that is done by conservatives in American politics. Russ: Well, part of the marketing problem that this view has is that to some extent it's hard to articulate what we'll get more of, because we--almost by definition of why we're in favor of it--we don't know what it is. It's like when people say, 'Well, what will replace those jobs if we let those imports come in?' Well, I don't know. Because we're going to get to spend our money on the things we love, and we're going to have more money to spend when we get to import stuff at lower prices; and what that will be is unpredictable. Which means there's not really--not only is there not a coalition of interests to support it; there's also not much vision for people to get inspired by. Unless they want to study economics for a few years and realize that things happen sometimes that are great that are unplanned. I think our job as economists, and in your case as a cultural entrepreneur is to try to imagine what some of those things might be. It might not be exactly that; and part of that's what you do in your book. But I think we need a lot more of that if it's going to be marketed effectively about how these intermediate institutions are going to make our lives better. Guest: Yeah. And you know, I think it requires also approaching people where they are, and asking people, 'What is it that works about contemporary American life? And what is it that doesn't work?' I think forcing people to think about what's good about the ways we live now would help people see that what we're offering is really more of what's working. By offering people more options, by giving people choices, we open up the possibility of incrementally solving problems. And that's really how we solve problems. But I agree: it's very hard to paint that picture. I always think of the first four or five chapters of Hayek's Constitution of Liberty as just an amazing, eye-opening way. I've had the experience of reading that with undergraduates a few times. And it's an extraordinary way of showing people why this very, very counterintuitive way of thinking about how to improve the world ought to be attractive to us. But it's a great challenge to make that visible to people in a political debate.

54:02 Russ: One thing we haven't talked about, and you don't talk about much in your book, is technology. In fact, I'm not sure you talk about it at all. And if all goes as planned, this episode will air after one with Kevin Kelly, which is a discussion of the inevitable forces that are pushing us forward. They make him an optimist. And yet I'd say many of the technological changes that we are in the middle of in terms of our ability to spend time on our devices and to live in virtual reality versus the real world, or to surf rather than to talk. Those are not helping, it would seem to me, some of the issues you are dealing with. Guest: Yeah. Russ: What are your thoughts on that? Guest: Yeah, that's true. I do talk about technology some in the book, but I would say that I actually tried to restrain myself from talking too much about technology on purpose. Because I think we assign too much of the credit and blame for what's going on in American life to technology now. And we look at certain kinds of social forces and we say, 'That thing's driven by the Internet.' Or 'That's driven by the development in bio-technology' here or there, when in fact what we're seeing are deep social forces that have been at work for a long time in a particular way. And then technologies arise that are adapted to them, that are well suited to them; and those become popular. So, I wouldn't want to overstate the role of technology in a lot of these changes. I've tried to think about technology quite a bit in recent years; I wrote a book about the science debates in our politics called Imagining the Future, back in 2008. And in a sense, in this book, I tried explicitly not to put technology at the center of the story, because I think technology serves us and technology takes the forms that we want it to take. Now, it obviously does transform the human experience in ways that, without question, have social implications and can set loose their own forces that independently become very, very important in how American life evolves. But I don't think that the changes we're seeing are fundamentally about technology. And so, even to the degree that they are exacerbated by technology for better or for worse, I--it makes more sense to me to think about them in terms of what it is we want and what that means we ought to do. Which basically is what politics in a free society is all about. And it's almost cheating a little bit to think about these things in terms of technology as if they are inevitable and we are just observers in the unfolding of our own fate.