Filling Up the Think-Tank Interview: Jeffrey Eisenach

Jeffrey Eisenach is president and co-founder of The Progress & Freedom Foundation located in Washington, D.C. He received his Ph.D. in economics from the University of Virginia in 1985, and since 1995 has served on the faculty of Harvard University's Kennedy School of Government. He has also held policy positions in government at both the Federal Trade Commission and the Office of Management and Budget. Editor at Large Blake Harris spoke with him about the changing role of government in the digital age.

by / October 31, 1997
Q: Can you describe the background of The Progress & Freedom Foundation and how its policy role has evolved in recent years?

A: The foundation grew out of discussions which Jay Keyworth and I had in 1989, where, frankly, we were suggesting a path for the Hudson Institute, which we were both involved with. Hudson chose a different path, and it has done very well with that, but the niche which we thought that we had identified -- a digital think- tank -- remained empty.

I then went off and ran Newt Gingrich's political-action committee, which was less famous then than it is now, and came back to Jay in 1992 and said, "The time is now." The niche is still empty. We need to create this digital think-tank. So, beginning in 1993, that is essentially what we have done. Our focus is on the impact of the digital revolution and its implications for public policy. That is the broad focus for us.

A big part of this is telecommunications policy, in the sense that we see the telecommunications or the digital revolution, technologically, as a catalyst for a lot of other changes in society -- the way the economy works and ultimately, probably last but not least, the polity. So what we seek to do is to identify areas whereby looking at public policy through the lens of the technological revolution, the digital revolution, we can bring a different perspective to bear and hopefully catalyze change ourselves in those areas of public policy that need to change.

Q: From this perspective, what are the issues that you see are long overdue for change and what are the issues that are looming on the horizon -- issues that government at all levels, really needs to start thinking about?

A: There is a book which I think is fundamentally wrong in its basic thesis, but has an interesting chapter, called Cyberslog by David Shank. It essentially portrays the digital revolution as a libertarian plot designed to accomplish a lot of policy goals that Libertarians and Republicans have been seeking for many years.

I think this is perhaps a perverse way of looking at a phenomenon that is nevertheless real. The digital revolution, as we have learned, is a tremendous force for decentralizing power, for empowering individuals, smaller institutions and local communities as opposed to empowering large centralized bureaucracies of any kind.

So as we look at the public policy arena we built through the Industrial Revolution -- and John Kenneth Galbraith identified it and named it brilliantly in his 1967 book, The Industrial State -- all the lessons we learned through the Industrial Revolution led to the creation of a large centralized state. That is present in virtually every area of public policy, some more than others.

The most important cutting-edge issue, really, is to turn the digital revolution free to allow the telecommunications technology and digital-connected computing to develop, because that is catalyzing so many other changes in society. As you go further into the public policy milieu, what you find is essentially everything will have to change -- the way that we provide Social Security, for example. Social Security meets a very real need in society.

The need is to ensure that people don't forget to save some money for their retirement so we then won't have to deal with the moral crisis of what to do with them when they get old. We need to have a solution to that. But that does not necessarily mean we need a "one-size-fits-all" plan run by the federal government called Social Security. There are other ways of accomplishing that which are a lot more consistent with the digital revolution and personal empowerment.

Q: We at Government Technology write a great deal about how different agencies at the state and local level are using new technologies to deliver faster and better service to the citizen. But something that is perhaps more difficult to understand is how the digital revolution is starting to change the actual processes of governance. In other words, rather than simply using technology to deliver more efficient and cost-effective government services that already exist, how is this technology going to fundamentally change the structure and focus of government?

A: The argument that I would make is that the substantive changes in the nature of politics are likely to be more important than the process changes. Let me explain exactly what I mean by that. There is tremendous focus given to process changes, such as the ability to call up your state legislator or congressman's Web site; or all the information now available electronically about legislation through the Library of Congress; or the ability to raise money by sending out e-mail to potential donors. I don't think those process changes are likely to be as important as the nature of the polity itself and the changes in the polity itself.

What I mean by that is that we are going to make a lot more decisions in local polities than we do today relative to the federal government. The same is true of international polities. Power is going to migrate, if you will, both up the institutional or political ladder to large international bodies, and it is going to migrate down the political ladder away from Congress to state legislatures and local city councils. And on another dimension, it is going to migrate into issue-specific and community-specific, not geographic-community but interest community-specific governing bodies. And we already see that happening.

Copyright law is, for practical purposes, written in Basel [Switzerland] and in international bodies that have defacto governing authority over international copyright law, and then it is approved by various national governments. That phenomenon is going to spread in an almost limitless fashion. We already have, for example, governing bodies for river basins that cross regional geographic boundaries. These are largely independent of the other polities. The Internet has already begun to set up some Internet-specific governing bodies to handle such things as arbitration of Internet-specific disputes. We are going to see an explosion of diversity in the political process, just as in every other aspect of society.

If you think about it, we have polities where we have communities. A community is a group of people that have common interests and agree to establish common, shared rules of behavior. And as each of us becomes members of more communities in more meaningful ways, we are also becoming members of polities. We will gradually organize those polities into self-governing bodies that govern more and more of our lives relative to the "one-size-fits-all" United States Congress and the federal process. And that is at once -- I won't say frightening -- but a challenging thought in the sense that it is going to mean that we can't turn to our Congressman to solve all problems. On the other hand, it is a freeing thought, that we will be members of polities where we can have a lot more impact than, frankly, you can have on a Congressman who has 650,000 constituents and doesn't really answer his own mail.

Q:Stepping back a bit from the discussion going on in the United States concerning the digital revolution: One thing that is very observable is how much this discussion is, in a sense, U.S.-centric -- far more so than the national focus that emerges when some of these same issues are discussed in other countries. The digital revolution is a global phenomenon, far more than any previous revolution has been. Are we missing perspective by being so U.S.-centric?

A: Yes, I think the U.S. needs to adopt a more global view. I guess that, for some readers, this might seem to be a point of criticism, but I think Americans still feel very strongly about the central premises of the American idea -- premises which are gradually being adopted around the world, even if in some cases there is a long way to go. And I think that, at that level, most Americans are cultural imperialists, if you will. I know that its kind of a hot word, but I think the notion of America being more involved in the world is one that would make sense to most people.

The notion of America being less forceful in advocating the American ideal is one that most Americans would probably not accept. The flip side of that -- well, let me give you an example of a place where I have very conflicting feelings. The French want a French culture. I think the American ideal says, if you want a French culture, you ought to be able to have one. And America shouldn't be able to force upon you its culture just as the federal government should not be able to force on the city of San Francisco a culture that would be appropriate for some small town in Georgia.

We value diversity and we value self-governing polities, and the ability within a very broad set of basic values to pursue those within communities and within self-defined communities. So I have some real reservations about saying to the French, you've got to become Americans. I don't think that is what the American ideal is all about. I think the American ideal is to say to the French, we have some basic values: We don't think people ought to be slaves; we think there should be some sense of self-government; there are some things we value that we, at some level, impose or encourage other countries to adopt. We didn't think South Africa was doing a very good job when it had an all-white government in a mostly black country, and we did some things to encourage change there. But within that very, very broad framework, do your own thing. And I hope we learn to apply that internationally as much as we are learning to apply it nationally.

Q: In terms of the power shift back to state and local government, a shift that the technology is driving as much as anything, one idea that floats about is that there is power sitting there that isn't being utilized. In other words, the local communities, and to some degree even state governments, have power today that they don't realize they have. They are to some extent still caught up in the old way of doing things. Do you think this is an accurate analysis?

A: Well, I think that is true. I've been critical of block grants and more broadly of federalism as a solution to all the world's problems. I think of that as trickle-down empowerment -- the notion that if the federal government will take some power and transfer it to a state bureaucracy, it will somehow solve the problems. I think what states and localities really need to be thinking about is how do we get back to a bottom-up empowerment that really starts with the citizen first, and in that sense, reshapes polities? Again, I would ask local and state government leaders to think more deeply than, "How do we keep doing the things we are doing more efficiently by applying some new e-mail technology?" Instead, they need to be thinking at the level of, "What are the communities that now comprise our geographical area and how do we facilitate their engagement in a lot more diverse political processes?"

Q: In your role as a think-tank, perhaps taking a little longer-range view, are there problems looming on the horizon that government in general has not even begun to think about?

A: I think there are two -- which are on the political playing field in some sense, but really aren't -- and they are macro-issues. One, which I raised earlier, is Social Security. We have to find a different way and a more digital way of encouraging people to save for their own retirement. The other specific issue is income tax.

More broadly, the state really has to come to terms with the notion that it too needs to be customer friendly. Michael Porter's book, The Competitive Advantage of Nations, is one that everyone in government ought to read, and where appropriate, replace the word "nations" with "states," or "nations" with "cities," or "nations" with "counties". We are now in a global economy, which is a trite thing to say. Nevertheless, we are not just in a global economy, but also in an instantly-fluid economy.

As we debate this encryption issue, for example, one of the points I make to members of Congress when I have the opportunity to do so is that Netscape fits on five 487s and can be operating in New Zealand tomorrow. It has no fixed costs. It has no infrastructure that it can't put in the belly of an airplane. And there is no reason in the world why, if Netscape decides, or any of our other advanced technology companies decide, that it would be more efficient and preferable to operate under a more friendly set of laws and institutions somewhere else, that they can't be doing that the day after tomorrow, literally, anywhere in the world, and nobody would even notice a service interruption. It is not like having to move your car factory someplace else, which takes ten years from planning to having it up and running.

I think this is going to force a very positive change. It is going to force an across-the-boards change in government where governments really have to ask themselves, what do citizens in the digital economy really want? We just released a report on the Digital State, and one of the points I made in the context of that, is that if you are a digital business -- and virtually all surviving businesses either are, or are becoming, digital -- the notion of going down to a business licensing office and waiting in line for a hour to fill out forms in triplicate is not conducive to a locational decision, wherever the polity is that happens to impose that kind of requirement. I think states, localities and nations need to move much more rapidly than they are right now to get digital.

Q: If there was one message you wanted to get across to local and state government, what would that be?

A: Well, about telecommunications policy: The use of computers in government agencies have been micro-issues or micro-micro-issues for the life span of everyone involved in those issues. They are not today. They are macro-issues.

The digital revolution is very real to the average citizen today. It is not something that is limited to a few techies who wonder whether we should buy an IBM or a DEC system to run our driver's license bureau. It is not limited to a couple of subcommittees in Congress who worry about whether we should set universal service prices at plus or minus 50 cents. It is a national issue that is in the hearts and minds of the majority of the American people today and will continue to grow in importance.

Everyone who is involved in making policy on these issues has to realize that they are in a fundamentally different political playing field in which there is a lot more freedom, but also a lot more danger. If you screw up today, you are going to have a lot more people paying attention to the screw up than you would ten years ago. And conversely, if you can lead a success, there is a lot more potential interest and power behind the ability to organize a success story, to organize a project and bring it to fruition.

There is a lot more ability to build coalitions and bring a lot more people into the process than you could before, and a much bigger pay-off if you are successful. And I think the sooner people realize that, the sooner we will begin to see rapid movement in policy as opposed to people sitting hunkered down in offices feeling frustrated that the digital revolution is here, but I can't make blank or blank or blank understand. It is on the front page of the Circuit City ad. They will figure it out.

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