Janus—God of Efficiency

I’m really excited about this new Department of Government Efficiency (DOGE) that Trump is creating to give Vivek Ramaswamy and Elon Musk something to do.  Perhaps we’ll see something done about the egregious waste at the Pentagon.  Or maybe an effort to rectify the economic inefficiency of massive tax breaks and subsidies for the corporate sector.  Or maybe some sort of restrictions on the ability of lobbyists to manipulate Congress.  But probably nothing like this.  How one thinks about the efficiency of a system like government is shaped by what one thinks the output of the system should be.  And most of the people who are calling the shots these days have a rather narrow and self-serving view about this.

One way of assessing the efficiency of a system is simply to look at the total output without much concern for how that output is distributed throughout the system.  In the case of an economic system, this usually means assessing the system against such metrics as the performance of the stock market and the GNP; the standard is simply the total amount of wealth produced by the system, however that wealth is distributed.  It is obvious that this notion of efficiency has a prominent place in the political culture of the US.

Another way of thinking about efficiency is exemplified by economic systems that support a social system designed to preserve the economic (and therefore the political) dominance of an elite class.  Here, the persistence, security, and power of the elite provide the standard for assessing the efficiency of the system.  It is worth noting that these two conceptions of efficiency are not incompatible.  One might argue that such measures as drastic tax reductions and deregulation will increase the total wealth produced by the system and preserve the corporate elite.  Indeed, this belief is almost gospel in the United States.

But a more interesting example of the idea that the purpose of an economic system is to nurture and preserve an elite is found in The Heritage Foundation’s Project 2025.  The discussion of tax policy(1) is most instructive in this regard.  One of the core principles of the Project 2025 tax policy says that “the tax system should minimize its adverse impact on the family and the core institutions of civil society.”(2). And some of the proposals are in fact likely to be beneficial to the working and middle classes.  But others clearly work to preserve the economic dominance of an elite class, for example, substantial reductions in the gift and estate tax rates and a cap on the untaxed benefits (such as medical insurance) that employers can give employees.  (Project 2025 suggests that this cap will result in higher wages which workers can use as they see fit, but there is no reason whatsoever to think that employers will pass this largesse on to employees.)

Project 2025 also suggests that long-term, more fundamental tax reform might include a consumption tax, such as a national sales tax.  The impact of such a tax is inversely proportional to economic status—the less one has, the more it hurts.  If you are interested to know what sort of elite these measures are designed to protect, you can consult the other sections of the document.

Of course, there are many other ways to assess the efficiency of an economic or other social system.  If we wanted to be really radical, we might ask about the extent to which the system produces for the people who live in it the genuine possibility of creating satisfying lives for themselves.  It was precisely this consideration which led Adam Smith to identify carefully designed market-based economic systems as a way both to make societies more productive and to distribute the results of that productivity in a way that enhanced human flourishing.  

One thing is certain:  we can’t really expect two bad boys like Musk and Ramaswamy to give much consideration to human flourishing.  But I am confident that they will provide us with sterling examples of efficiency in the use of their positions to enrich themselves.   

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(1) Project 2025, The Heritage Foundation, pp. 695-698.

(2) ibid., p. 696.