The Apollo Program is a good litmus test of someone’s politics. Was it an unmatched feat of engineering or an unparalleled waste of money? A united society moving humanity forwards, or pointless willy-waving at superpower scale?
Most obviously, the moon landings – like Concorde, and to some extent nuclear energy – represent the loss of an engineering capability, which feels wrong because we have not lost the relevant technology or suffered economic collapse.
What we have done, which is no less harmful to human progress, is to enter an age of bloat.
IBM’s deal to supply the Apollo Guidance Computer is among the most consequential business contracts in human history. Its success gave America a boost in the Cold War, whereas failure on a crewed mission might well have been fatal. More generally, the advances it brought about kick-started the modern chipmaking and computer industries.
This era-defining contract was just ten pages long. That’s shorter than the most recent contract I signed with a client, which is for a few days of work in which, I hope, no lives are at stake. Service agreements between big businesses, especially those involving government contracts, now frequently run to thousands of pages.
This is largely why the West can no longer build things. Just about every major infrastructure project in Europe and America for the past decade, from airports to nuclear power stations, has been subject to huge delays and cost over-runs. Some projects have failed entirely: The UK last year abandoned plans for a high-speed railway line, HS2, that has been technologically possible since the 1970s, losing tens of billions of pounds in the process.
Cost of compliance
While some of this bloat has grown within corporate culture, the main problem is that governments add regulations each year without ever taking any away. This is not to say that businesses should be given free rein, but rather that the requirements they face should be clear and straightforward; regulations that are out of date should be scrapped or consolidated.
We have reached the stage where even small businesses have to hire compliance specialists in order to operate. As a sole trader in knowledge work, I run a business of the smallest and most straightforward sort – and yet even I need an accountant to avoid falling into dreaded non-compliance. This should not be seen as normal.
Tax codes are full of loopholes and incentives that no longer make sense, if they ever did. In Belgium employers can issue part of their payroll in tax-free ‘eco-cheques’, which their staff may then spend on various products classified as green. The idea is to nudge consumers towards eco-friendly purchases.
But the incentives make no sense: Eco-cheques can be spent on air-conditioners and tumble dryers if they’re moderately energy-efficient; but small organic grocers or second-hand clothes shops don’t accept them because they lack the administrative capacity. When I was salaried, I once spent my eco-cheques online to have organic wine delivered to my door in a diesel van. It tasted foul and created more emissions than a walk to my local wine shop, which is what I do when the government isn’t distributing pointless and arbitrary new forms of money.
Just this one loophole puts a significant burden on the economy. Eco-cheque cards must be issued, apps programmed, goods classified as green or not. Employers must punch data into computers and shopkeepers must fill in yet another form. All of this work is pointless and wasted; those performing it have bullshit jobs.
The power of inertia
We stick with bad policies because we have a neurological bias towards inertia. Here’s a thought experiment, sticking with today’s wine theme: Imagine you have a big birthday coming up, and you have in your cellar a bottle of wine from your birth year that needs to be drunk soon. You can sell it to an enthusiast for €200, or you can serve it at a birthday dinner with your friends. What do you do?
Now imagine the same birthday coming up but there’s nothing special in the cellar. You do, however, see a very nice bottle from your birth year in a wine shop, priced at €200. Do you buy it for your dinner, or leave it on the shelf and serve something more ordinary?
In both cases, the choice is the same: €200 or a very nice bottle of wine. Yet most people choose the wine in the first scenario and the money in the second. In other words, we are wired to prefer the status quo: Wine in the cellar is worth more than wine on the shelf.
The same is true of legislation. No sane person would introduce eco-cheques today, having seen the perverse incentives they generate in practice. The government could kill them off by closing the related tax loophole, freeing up many people for productive work. But nobody will do it because, well, they’re there now.
Governments, staffed by fallible humans, give too much respect to laws that are already in place, and do not review or repeal them nearly as often as they should. At the same time, they rightly introduce new regulations to meet new challenges. The result is a steady net increase in the size of the statute book – in other words, bloat.
Fighting the flab
Striving for simplicity is not a new idea. Engineers have long hewed to an ideal of efficiency best expressed by the French writer Antoine de Saint-Exupéry: “A designer knows he has achieved perfection not when there is nothing left to add, but when there is nothing left to take away.”
My work as an editor follows the same principle. I will occasionally add details to a writer’s story, but more often I will be cutting parts that are superfluous or refining passages to be sharper and more concise: creating value by destroying content.
Governments seem unable to do this. Looking back through history, the only reliable way to simplify regulation is to have a hard reset, which generally means losing a war. West Germany and Japan both enjoyed economic miracles in the decades after their military defeat, partly as a result of shucking off decades’ worth of state capture alongside the fascism that oversaw it.
That is obviously less than ideal. Even if a ‘bonfire of regulation’ could be achieved without violent regime change, untrammelled capitalism is not desirable. Many existing rules do still serve a purpose, and new ones are needed to address emerging challenges such as disinformation or smartphone addiction.
Discussing this problem at an event last week, one person had the cute idea to introduce ‘deregulation years’, where policymakers would spend odd-numbered years adding new rules as normal, and even-numbered years reviewing, repealing and simplifying regulations that were no longer fit for purpose. A blunt idea, but one that would probably do more good than harm.
It is often said that when all you have is a hammer, everything looks like a nail: Government bureaucracies will keep regulating because that’s what they are designed to do. But modern hammers also have a claw to straighten out or remove badly placed nails. Policymakers should learn to use it.