Donald Trump has said that if he is reelected, he would overturn 140 years of civil service protection by making “every executive branch employee fireable by the president of the United States.” The majority of the public may find this policy appealing because of their low regard for government institutions—a view supported by empirical evidence that government policies to improve the efficiency and fairness of markets have wasted considerable resources. Critics may point to the loss of expertise, and the potential for weaponizing agencies every time a new president is elected.
In the final analysis, however, Trump’s proposed policy is essentially a ruse that should give pause, even to his supporters, on economic grounds. It would not reduce current inefficiencies. Instead, it would convert them into a dystopian national economy and compromise the effectiveness of markets to help government.
There are three distinct ways that government policies have wasted resources. One is by producing benefits that don’t exceed costs. This outcome has been well documented for price regulations, such as tariffs and agricultural subsidies, which reduce competition; tax credits, subsidies, and patent protection to promote innovations, which would have occurred without those policies; and large subsidies for services, such as urban rail transit, used by a vast minority of the public.
A second way that government policies have wasted resources is by producing negligible benefits. This outcome has been well documented for antitrust enforcement that was either unjustified because firms did not engage in anticompetitive behavior or because the court imposed a remedy that produced minimal benefits for consumers. It has also been documented for policies that have been eclipsed by private sector advances, such as information technologies that inform consumers and workers about potential risks to their health and safety better than do government information policies, and for policies, such as recent antidiscrimination laws, that have been undermined by firms’ actions.
Finally, government policies have wasted resources by producing benefits at excessive costs. This outcome has been well documented for polices to reduce externalities, such as pollution, which attempt to command and control firms’ behavior instead of using efficient taxes to incentivize firms to reduce their externalities. It also has been documented for antipoverty policies that are duplicative and that disincentivize recipients to work, and for universal instead of means-tested programs that help households pay for education and housing and that provide social insurance.
Trump does not explain how his plan to eliminate civil service protections would reduce the economic waste caused by those policies because he is not interested in that issue. However, his disinterest should not be allowed to pass. The public’s welfare depends critically on policies that affect the prices, quality, and availability of goods and services that people purchase; the risks that those goods and services pose for health and safety; the quality of air we breathe and water we drink; the quality of life for lower-income and infirmed people; and so on.
Clearly, current policies could be substantially improved to waste fewer resources. However, Trump’s plan to eliminate civil service protections would not help to achieve that goal because his objective is to staff the government workforce with sycophants who have little knowledge of or interest in improving government performance. Instead, government workers would seek to curry Trump’s favor out of fear that they would be fired if they objected to Trump’s policies by pointing out their shortcomings.
Current policy inefficiencies would then become worse. Policies whose costs exceeded their benefits would waste more resources because Trump would impose stricter price regulations to keep out foreign goods, reward agricultural interests he likes, make it more difficult for innovations to evolve, and allow public services to decline even further. Policies that once produced negligible benefits would produce significant additional costs because Trump would use antitrust policy to prosecute firms that he perceives as hostile to him, oppose information technologies that he finds threatening, and curtail efforts to reduce discrimination. Finally, policies that produced social benefits albeit at excessive costs would produce far fewer benefits because Trump would cut environmental and antipoverty policies and social programs but not improve their efficiency.
Importantly, government data that has enabled academic researchers and commentators to assess the effects of government policies would no longer be publicly available. Trump’s sycophants and supporters would simply take Trump’s bluster that markets under his administration are more efficient and equitable than they ever have been as fact, and naysayers would find it difficult to offer evidence to refute him.
My vision of the economic effects of Trump’s plan for the civil service may be ignored by some of his supporters who believe that Trump’s policy pronouncements should not be taken literally because his actual policies would be less extreme if he were reelected. But that belief is of little comfort when Trump has had a history of business failures that have converted inefficiencies into dystopia, while he has somehow managed to escape unharmed to pursue new ventures.
Trump’s other supporters who believe he will do what he says and approve of his plan for the civil service should reconsider their approval on economic grounds, if no other. For example, who will they complain to when they don’t receive their social security check, or their favorite national park is closed, or when they cannot purchase a valued product that relied on imported materials to produce? Even in these divided times, Trump’s desire to create a loyal and partisan federal workforce in his image should be of great concern to the public at large because the US economy will not escape unharmed.
