Tyler Cowen interviews Ezra Klein on abundance, kludgeocracy and so much more

Here's the link, and the intro:

What happens when a liberal thinker shifts his attention from polarization to economic abundance? Ezra Klein’s new book with Derek Thompson, Abundance, argues for an agenda of increased housing, infrastructure, clean energy, and innovation. But does abundance clash with polarization—or offer a way through it?

In this conversation, Ezra and Tyler discuss how the abundance agenda interacts with political polarization, whether it’s is an elite-driven movement, where Ezra favors NIMBYism, the geographic distribution of US cities, an abundance-driven approach to health care, what to do about fertility decline, how the U.S. federal government might prepare for AGI, whether mass layoffs in government are justified, Ezra’s recommended travel destinations, and more.

The interview covers a lot of territory. Check it out for yourself. I present two excerpts below:

On the abundance agenda as an elite movement

COWEN: Is the abundance agenda primarily a view of elites? And insofar as it succeeds, it will succeed to the extent that politics is not directly ruled by democratic forces?

KLEIN: I don’t know that I think that’s true, but it’s always a little bit true. In my own head, I think there are two kinds of policy and procedure overhang. One is the kind people actually want. A lot of NIMBYism is popular at the level at which it is happening.

But then, there’s a kind that comes from drift. It doesn’t end up being in the book, but I wrote a Times piece about this. I don’t know if you tracked the story a while back that there was this public toilet being built in Noe Valley in a park — I used to live near this park — that was hooked up for water. The cost estimate was $1.7 million. They released a ribbon cutting for this. [laughs] They came out to announce that they had gotten the money from the State of California to build this $1.7 million toilet.

Then my colleague, Heather Knight, back then at the San Francisco Chronicle, reported on this, and people freaked out. They were not happy that the city had gotten $1.7 million for a toilet. They thought, “Why?” I went and tracked down, how does a toilet get to $1.7 million? One of the justifications from Rec and Parks in SF was, “Look, we’ve built all these other toilets that were $1.6, $1.7 million, and nobody complained about that.”

It’s this baroque process where you have seven, eight, nine agencies. You have all these public comment periods. There are all these rules on the grant proposal, and how that goes out, and what the procurement is, and how you do the bids on the contracts. Nobody asked for that. That’s drift. That is process building on top of itself. That is nobody really having the power to say no or wanting to go through the difficulty of saying no.

I cut that differently from some of the — there are places where people do not want to see an affordable housing complex built down the block. Then there are places where people would actually like to have an affordable public restroom next to the playground where there are kids who — I’ve been through this period of mine very recently — who are not fully potty-trained, playing. They’re not out there hoping that we can add $1.3 million in cost by process; they just don’t really know that it has happened.

COWEN: If the abundance agenda is, to some extent, an elite movement, it seems that high density, for the most part, is bad for elites. In California, very wealthy elites — they want to move to Woodside. In Northern Virginia, they want to move to McLean. Does this mean the NIMBY part of the movement is just never going to get very far? That you can take a bunch of places, say, near metro stops, and allow for somewhat denser housing, but it will stop there.

KLEIN: Is that true, though? I live in New York City now, and my sense is, very wealthy elites — while they have a weekend house or vacation house, possibly in the Hamptons, they live in Manhattan in glass towers, or they’ve started to buy really expensive property in Brooklyn or in —

COWEN: But that’s one state, right? The country as a whole — the elites want the ranch two hours from Houston.

KLEIN: It seems they want both, to me. I feel like, the elites of DC live in McLean — that was true 20 years ago, and it feels less true now. You still live there, but is that really what people do when they get rich in DC now? I feel like they buy expensive DC property because DC got safer, and the food got better, and all the things that everybody knows.

Kludgeocracy and DOGE

COWEN: You know full well Steven Teles’s work on kludgeocracy. We have at least 50 years of the kludge that is just accumulating. Everyone in government knows about this. It’s not some secret. Various administrations have tried to address it. Al Gore did a bit — that was fine, but it didn’t really stop it. I don’t see that there’s any other recipe besides quite a bit of disruption. Again, there’ll be future administrations to sort it out.

Like the New Deal agencies — they weren’t so great to begin with. They didn’t have experience or data or staffing, but over time, pieces fell into place. Maybe the options are just more and more Steven Teles’s kludgeocracy or we take some chances today and do some things that actually hurt. Then over an 8- to 12-year period sort it out with AI and most of all, with future administrations, I don’t really see what the alternative is.

KLEIN: Well, I think there are two questions here. Let’s say there’s a good version of this and a bad version of this. I’ll outline the way I see both. Let me start with a good version of this. If I was saying what I hope the story of this period will ultimately be, I have to describe it as thesis, antithesis, and synthesis, which I think is a little bit of what you’re saying.

My critique of Democrats is, they became culturally process- and bureaucracy-obsessed. They saw the state and inside their own agencies, inside things they, in theory, run, they were anything a lawyer said you had to take as holy writ. No matter how off the wall or stringent the interpretation of what was clearly a looser original statute was, it was careful. Every process had to be followed to a T. Democrats, in theory, the party of government, cannot run government effectively because of some of the reasons you just described and some of the reasons I just described.

Then in comes Donald Trump and Elon Musk, and if they have proven anything, it is that a lot of the things that previous administrations — by the way, Democratic and Republican — treated as inviolable were just not. They weren’t real. They were norms, not rules, norms not laws. It is clear that some of the firings were illegal. Clearly not all of them. It is clear that some of the withholding of money is illegal. My gut is, having seen the five-four decision the other day at the Supreme Court which went against the Trump administration — but it was a five-four decision — it’s not going to be all of it.

There is a lesson that is being taught here by Musk, which I think liberals have to look at very uncomfortably, which is that things that they treated as facts of the system that could not be in any way altered and then used as excuses for low-performing government services for genuinely . . . Probably what Elon Musk is calling waste and what I would call waste are not the same thing, but there is what I would think of as a lot of waste. They allowed a civil service system to emerge and evolve that everybody knows is crazy. Everybody knows it’s crazy.

Here comes Musk and Trump — antithesis. I don’t think they’re trying to make things work. I don’t think it’s zero-based budgeting. I don’t think they’re holding things to a standard. I think they’ve cut off huge amounts of lifesaving work. I think they are creating a lot of risk in parts of the system that could really blow up. I think what they want is control, not a working government.

COWEN: No, I’m not defending —

KLEIN: Well, I think you are a little, at least on the margin. I’ll take that as a Straussian.

COWEN: Some parts of the approach are necessary, and it’s not even clear to me what they’re doing.

KLEIN: I think it’s not always clear to them. Then, my hope is that the next administration — if this all doesn’t blow up in our faces in a truly terrible way — is able to do synthesis, which is to not try to destroy the federal government, but to take the lesson of DOGE seriously. That a lot of what liberals, a lot of what the establishment was treating as “It just has to be this way. These are the rules, these are the processes. There’s nothing to be done about it.” No, it actually seems you can do quite a lot of it.

I’ve thought a lot about the payment systems and the Treasury privacy data. How many social insurance programs work poorly because they couldn’t get any access to that data? I’ve heard about this a lot in the design of systems beforehand, and this turned out to not be the case. You could get access to the data if you really wanted it. There’s no reason we needed to have the software procurement systems that led to healthcare.gov. We just didn’t. And it is true that then over time, this has been adapted somewhat in that area. USDS, US Digital Service, and 18F were significant there, and they’ve destroyed them. There was a lot you could do.

That, I think, is the good version, where what we’ve had is a fire, and it’ll do things that I am very unhappy about, but it will also open the way to something that is not as relentlessly and illogically bureaucratized as the way government was run under, say, the Biden administration, and is not as destructive and corrupted as what we’re seeing under Trump and Musk.

I think the bad version of “there’s no choice, but we have to come in and do something like this” is that they actually don’t know what they’re doing. This isn’t zero-based budgeting. They don’t know who they’re firing. They don’t really know what the people do. They’ve not evaluated things on a cost-benefit scale. They’re trying to use loopholes.

And it does turn out that the system manages a lot of risk. Most of the risk it manages in any given year — it’s going to be fine if you don’t have anybody there managing it. But when things do go wrong, when you do roll snake eyes — and you always do, eventually — it’s going to turn out we really needed some of this.

You see them freaking out about this on the daily, basically. They go fire all these people who are on nuclear safety and don’t even realize they’ve done it, and then are desperately trying to get back in touch with them to come back so we don’t have huge problems in the nuclear system. Or Musk saying that he didn’t mean to turn off all the payments on the Ebola work, but it turns out they did, and then saying that he turned it back on. In fact, you talk to people on the ground there, and he didn’t.

So, I’m worried about risk exploding, which is why I wouldn’t have wanted to see it done this way. I think that people who are in my position — and I think people care about effective government — really need to look with some anger and shame about the way in which the people who believe in government basically gave up on government reform and left that to this kind of process.