The promise of expertise: Walter Lippmann and the policy sciences
CRAUFURD D. GOODWIN
Walter Lippmann addressed over his lifetime many of the questions raised still in the policy sciences about the proper role for the social scientist in the policy process, the potential contributions of various disciplines to an understanding of the issues, the kinds of circumstances most likely to nurture excellent policy analysis and the means whereby both a narrow elite and a wider public can be well informed about critical subjects and policy options. This article examines Lippmann’s intellectual formation to deal with these questions and his reflections on institutions designed to foster policy analysis as well as the proper training of a policy expert. The article concludes with an examination of Lippmann’s career as a practitioner in the policy world, and especially as a bridge between different communities.
Walter Lippmann (1889-1974), social philosopher, confidant of statesmen, and perhaps the most distinguished American journalist of the twentieth century, was concerned over the course of his life with a question that worries policy scientists still: what is the proper role for the intellectual, and for the social scientist in particular, in the policy process?’ He was not alone in this concern, of course, and from his position as journalist with no specific allegiance to any one scholarly discipline, he was able to take account of the pioneering thinking of others concerned with these issues such as the philosopher John Dewey, the economists Thorstein Veblen, Wesley Mitchell, John R. Commons, and John Maynard Keynes, and the political scientist Charles Merriam. Lippmann was a voracious consumer of ideas and he drew much from the work of others. But he made important contributions of his own to our understanding of this range of topics.
There is a remarkable freshness still to many of the questions that Lippmann addresses, for example: What disciplines in the social and behavioral sciences are likely to enlighten a policy discussion and contribute to the training of a policy analyst? Were contemporary academic institutions organized effectively to encourage policy research and training? What kinds of human behavior should be taken into account when modeling social processes and constructing public policy? Lippmann was an early skeptic of single-minded attention to self-interest as a motivator both of social actors and of policy analysts. He wondered whether something analogous to Veblen’s instinct of workmanship could not be cultivated in the policy sphere.
Lippmann was bothered throughout his life by an almost Marxian concern that societies could not adapt their policy-making structures to the policy problems that were always undergoing rapid change. He was also troubled by the citizen’s responsibility for understanding in a democracy. How much could be expected from the wider public when they are faced with complex and evolving policy challenges? Could they ever be brought to think clearly, rationally, and with proper assumptions about policy? How can the public be persuaded to accept counter-intuitive public policies like deficit finance? Lippmann was led naturally to the role of elites by his eroding faith in the judgment of the masses. He then moved, in tum, to reflections on the role of the scholarly disciplines and to the functioning of institutions of higher learning. How, he asked, can the social sciences preserve their scientific character while at the same time ministering to the policy interests of both government and the wider public? How can the provision of policy analysis, a public good, be financed in a democracy?
Like all of those who came after him, Lippmann was not able to answer all of these questions to his own satisfaction or to ours. But he made some important contributions that are highly relevant still.
The first part of this article examines Lippmann’s intellectual formation, which culminated in his identification of economics as the discipline most likely to illuminate policy issues. The second part focuses on Lippmann’s extraordinarily rich reflections on the institutions that are required in a democracy to provide for the production, filiation, and use of policy analysis. He wrote about the role of universities, about analytical units in government, and about the need for strong non-governmental research institutions to inform social elites about pressing policy questions. The third section takes up Lippmann’s reflections on the making, and sustaining, of a policy analyst. The final section describes how Lippmann actually practiced what he preached, and in particular, how he sought to act as an intermediary among key communities involved in the policy colloquy: academics, public policy makers, private sector leaders, and the media.
‘Dealing with unseen reality’: Lippmann’s search for the scientific formation of public policy
Walter Lippmann was the intellectually gifted child of a prosperous New York mercantile family. He grew up to privilege in almost all things: wealth, travel, the arts, education, contact with prominent people. At Harvard, where he majored in philosophy and explored the new science of psychology, he was a student of William James and George Santayana. In the halcyon days just before World War I, as a budding left-of-center journalist, his faith in the capacity of ‘reason’ to provide answers to social problems knew no bounds. He was a true child of the Progressive Era with the characteristic confidence of those years in the potential of scientific managers to devise sensible social policy for virtually any problem. Many intellectual traditions affected his thought, fromm the familiar liberal ideas of Locke and Mill to British Fabian socialist and the new Institutional Economics of Thorstein Veblen.
From Graham Wallas at Harvard Lippmann accepted the essentially Marxian notion that technological change was inexorably altering the underlying structure of the modern world while the superstructure of institutions in society was struggling unsuccessfully to keep up with change. In particular, he thought, technology had necessitated the creation of a highly-integrated and complex global society (Wallas’s ‘Great Society’) wherein economic and security problems could no longer be dealt with from local or even regional perspectives. Yet narrowly national policies were still the usual focus of attention. In his first book Preface to Politics (1913) and in his early columns for the New Republic, which he edited with the Progressive publicist Herbert Croly, Lippmann attacked aspects of contemporary democratic theory and practice that he found appropriate only for the isolated local communities of the eighteenth century and not the highly integrated, modem world. Somehow, he argued, means must be found to change the habits of mind and intellectual outlook of those who led society. Leaders must come to accept the inevitability of large organization, the necessity of specialization, and the demise of ‘village life.’ Above all, the intellectual resources of society must grow apace with economic resources so that social technology could catch up with the physical improvements.
Lippmann’s second book. Drift and Mastery (1914), written just before the outbreak of war, wrestled with the question of how to create the motivation to find solutions to the world’s problems. He thought that single-minded dependence in theory and practice on pursuit of self-interest as the dominant motivating force in society was anachronistic and unproductive in the modem age. The problems generated by modem technology had simply rendered exclusive dependence upon the self-interest postulate theoretically and operationally obsolete; in the case of the business sector: ‘however effective profit may have been for inaugurating modem industry, it is failing as a method of realizing its promise’ (Lippmann, 1914: p. 32). There were, he was glad to point out, some indications of forward movement away from simple profit maximization as the motivator of business behavior. ‘Endowment, cooperation, or public enterprise are attempts to employ motives different from those of the profiteer. The only dispute is whether these new motives can be extended and made effective’ (p. 33). In these expressions of unease about self-interest as the explanation of human behavior, Lippmann was making both a normative judgment about the desirability of humans modifying their goals and a positive statement about the need for social theory that postulated more complex human behavior.
At this early date Lippmann remained optimistic about changing the motivational base of society as a solution to society’s ills; he found special reason for hope in the new caste of business managers ‘divorced from ownership and from bargaining’ (Lippmann, 1914: p. 46) Lippmann observed twenty years before Berle and Means that ”the corporation has separated ownership from management’ (p. 58; Berle and Means, 1937). Increasingly the men who ran large corporations were acquiring a professional training and ‘contact with the scientific method.’ What this implied for their motivation and behavior was not yet entirely clear, but for Lippmann it promised potential liberation from action based simply on profit-seeking. He echoed the hopes of Veblen and his disciples that a society operated by reasonable professional men could find the means to deal effectively with modem problems: doctors and engineers and professional men, generally have something more than a desire to accumulate and outshine their neighbors. They have found an interest in the actual work they are doing. The work itself is in a measure its own reward. The instincts of workmanship, of control over brute things, the desire for order, the satisfaction of services rendered and uses created, the civilizing passions are given a chance to temper the primal desire to have and to hold and to conquer (pp. 48-49).
Lippmann could not see salvation in a socialist dream of increased public ownership, a monolithic state, and a large leaden bureaucracy. Instead he looked to crucial contributions from a rational and enlightened corporate executive – ‘a new type of business man … a man whose motives resemble those of the applied scientist and whose responsibility is that of public servant’ (Lippmann, 1914: p. 63). Unlike Veblen (e.g., 1921), who had faith in the behavioral responses of engineers but not in those of the businessmen concerned only with ‘pecuniary’ issues, Lippmann hoped for rationality from both. Lippmann had little praise for the anti-trust movement that persecuted the large corporation. In fact, he thought the small businessman of the competitive market was precisely the person least likely to find solutions to complex social problems. It was the executive of the large corporation, indeed of the monopoly ‘trust’ itself, who had the best opportunity to exert real leadership:
I submit that the intelligent men of my generation can find a better outlet for their energies than in making themselves masters of little businesses. They have the vast opportunity of introducing order and purpose into the business world, of devising administrative methods by which the great resources of the country can be operated on some thought-out plan. They have the whole new field of industrial statesmanship before them, and those who prefer the egotism of some little business are not the ones whose ambitions we need most to cultivate (Lippmann, 1914: p. 141).
Lippmann saw economic concentration as the root of many potential problems for society but also as perhaps ultimately the only hope for social regeneration: ‘bad as big business is to-day it has a wide promise within it, and the real task of our generation is to realize it. It looks to the infusion of scientific method, the careful application of administrative technique, the organization and education of the consumer for control, the discipline of labor for an increasing share of the management’ (pp. 144-45). In this admiration for big business, and his recognition of the temptation in society to cripple it, Lippmann’s view is similar to that of Joseph Schumpeter, with whose work he was probably not familiar at that time except perhaps through reviews of The Theory of Economic Development (1911).
There were institutions in society, Lippmann noted, supposedly constructed to accomplish the critical development of intellectual resources needed for regeneration of the liberal democracies: the schools, the churches, the courts and the several levels of government. The difficulty was that these institutions ‘were not built for the kind of civilization they are expected to serve’ (Lippmann, 1914: p. 154). They were all constrained by practices and traditions from an earlier age that led to policies of ‘drift’ in the face of acute social challenge. This tendency to drift was strengthened by various companion social philosophies that, he believed, led to intellectual paralysis rather than to progress. Thousands placed their faith in ‘some one change,’ like the single tax, that would ostensibly make everything well again – but in fact did not. Others depended upon a set of absolute doctrines, like those of the Catholic Church, that failed to confront reality. ‘In liberal thought,’ where still others sought salvation, ‘there is chaos’ (pp. 187,200,201). Lippmann, of course, was not alone in this kind of soul-searching about liberal values.
Lippmann saw the scientific mind-set as the essential antidote to intellectual sclerosis, the bane of authority and of bogeys and superstitions of all kinds that limited creative thought in a democracy:
For the discipline of science is the only one which gives any assurance that from the same set of facts men will come approximately to the same conclusion. And as the modem world can be civilized only by the effort of innumerable people we have a right to call science the discipline of democracy…. Mastery is inevitably a matter of cooperation, which means that a great variety of people working in different ways must find some order in their specialties. They will find it, I think, in a common discipline which distinguishes between fact and fancy, and works always with the implied resolution to make the best out of what is possible (Lippmann, 1914: pp. 285-86).
In calling for rejection of the policy anarchy which he called ‘drift’ and for ‘mastery’ of social forces through ‘a common discipline which distinguishes between fact and fancy,’ Lippmann was looking to the creation of what his descendants in the second half of the twentieth century would call the ‘policy sciences.’
That Lippmann had deep respect above all for the scientific method did not mean that he necessarily had a high regard for the state of all modern science. He did not. He was especially dubious about the condition of economics with which he had a complex love-hate relationship over his lifetime. Despite his own adventures as a student and young journalist with the new disciplines of psychology and political science, he came soon to see economics as the potentially most important social science because it dealt with the world’s most critical questions of industrial and labor organization, consumer protection, public enterprise and human welfare in general. Lippmann explained that he developed an interest in economics after recognition that a free market system was the only way to achieve effective division of labor:
I began to perceive that the overhead planning and coercive direction of human activity was radically incompatible with the economy of the division of labor. I saw then that historic liberalism was the necessary philosophy of the industrial revolution … it was clear that the division of labor, democracy, and the method of the common law are organically related and must stand or fall together, because they are different aspects of the same way of life (Lippmann, 1937: pp. 373-74).
As early as World War I Lippmann called for the appointment of ‘committees of economists representing public, labor, and various interests, studying all the intricate questions of tariff and financial reconstruction’ (J. M. Blum, 1985: p. 57). By the 1930s Lippmann had come to believe that economists had made strides toward outlining such problems as these and the potential of the free market but they had also too often left the right track. In several sweeping reviews of the history of economics Lippmann concluded ‘without fear of contradiction’ that Adam Smith and Karl Marx were ‘the two most fertile minds that have dealt with the modern problem’ (e.g., Lippmann, 1914: pp. 311,312). He came to conclude ultimately that Marx, as one of ‘the great generalizers,’ seriously misled his followers (Lippmann, 1935: p. 6). But he continued to make use of Marxian insights. He charged Ricardo and Mill with leading classical economics down the wrong path of reductionism. The influence of John R. Commons was evident in his description of this misdirection. He said:
Not only did their social science fail them as a guide to public policy because of their preoccupation with the false problem of laissez-faire; but they fell into a complementary fallacy which was equally destructive to the development of liberal science. Just as they had assumed that the economy of divided labor operates by natural laws outside the context of a legal system, so they also assumed that these natural laws were the laws formulated in their economic science (Lippmann, 1937: pp. 195, 243; Commons, 1924).
Lippmann expressed disappointment also with Alfred Marshall and other marginalist economists. These disciples of the early classical economists, he found, had not lived up to the vision of their masters. They were particularly at fault for not developing a persuasive theory of income distribution. He was especially unhappy with explanations of the supply curve of labor that, he complained, ignored the potential contributions of social psychology on the subject of human motivation:
‘The real world was a blooming buzzing confusion to the economists because the economy operated in a context of ancient habits, prejudice, usage, and law. They had to simplify the facts by supposing that all men would and could behave in certain definite ways'(Lippmann, 1937: p. 198).
The simplistic behavioral postulates of modem economics, more than any other feature of the subject, continued to bother Lippmann, and his unease may help explain his admiration for and friendship with the rebellious John Maynard Keynes who seemed, at least, to entertain the possibility of a more complex psychology. Lippmann’s study of Freud, James, and other pioneer psychologists convinced him that pursuit of self-interest, or of profit, was not an adequately rich explanatory principle of human action. He himself played with the role of instincts and the subconscious as alternatives, and he was impressed by Keynes’s distinction between rentier and entrepreneurial behavior, including the rather vague notion of animal spirits (Lippmann, 1937: p. 229). In general, he consistently maintained that ‘the orthodox economists and the orthodox Marxians are out of touch with the latest forces of this age: both have proved themselves largely sterile’ (Lippmann, 1914:p. 312).
In one of the many flashes of insight where he seems to have been well ahead of his peers Lippmann speculated that the fault with the social sciences might be that for too long they had depended upon analogies from other sciences. For real progress to be made an autonomous body of behavioral theory had to be developed. Instead economists had simply borrowed from physics and biology:
It is obvious now that just as Darwinism supplanted the Newtonian physics as the prevailing intellectual fashion, so today Darwinism is itself out-moded. The difficulty, however, is that the prevailing physics, as set forth, I won’t say by Einstein for none of us understands him correctly, but by the disciples of Einstein … simply does not lend itself to myth-making. The result is our political thinking today has no intellectual foundations and it’s my guess that we shall not find them as the Eighteenth Century liberals or the Nineteenth Century devotees of progress found theirs, in analogies from the physical sciences. In a sense we have become too self-conscious about science to use it as analogy. We know that human beings do not really behave either like wild animals in a jungle or like a collection of molecules. The foundations for us must lie, it seems to me, therefore, really not in nature as our immediate forefathers believed, nor in super-nature as their forefathers believed, but in human nature. That is to say, in an objective understanding of what we really are (J. M. Blum, 1985: p. 241).
Although it was Lippmann’s purpose in Drift and Mastery (1914) to reflect on how public policy toward critical questions of the age could best be formed, he was led by his emphasis on the powerful influence of the scientific method to some observations about the unsatisfactory condition of the social sciences in general. He understood well the role of theory, modelling, and the formulation of concepts and generalizations. But he thought that these features of the scientific enterprise were potentially intoxicating and self-destructive and led the social scientist away from reality, where true progress in their sciences must lie, to mere game-playing. In the case of economics, he wrote:
Few economists can remember that their reasoning is built upon an unreal picture of man and industry. By the time the details are worked out, economists have the greatest difficulty in recalling the fact that they have been talking about an imaginary world, a world which pleases their fancy because it yields to their logic (Lippmann, 1914: p. 320).
To this many present-day policy analysts would still say, ‘Amen!’
The challenge of policy formation: The prospect of institutional response
Lippmann arrived at World War I convinced that technological change had created both exciting opportunities and frightening challenges for the global economy and polity. The possibility of vastly increased production from economic growth was clear, as was the danger of destruction from international conflict. The only hope for humanity, he thought, lay in a reasoned approach to policy by a sophisticated cadre of leaders who must replace, through their creative imagination, traditional appeals to dogmas and shibboleths with applications of the scientific method, especially the method of the new, burgeoning social sciences. But Lippmann was gloomy both about the condition of the institutions in contemporary society expected to nurture, train and sustain such leaders, and about the directions being pursued by some of the social sciences – particularly, as already indicated, by economics.
World War I and the interwar years served only to strengthen and deepen the prewar convictions of Lippmann about the need for reform of policies and institutions. His own attention to and involvement in international affairs were vastly increased by his wartime experience. He learned not only more about the world itself but also more about its dangers and complexity. Moreover, Lippmann’s dark view of the social institutions and their prospects for generating the required intellectual response was not relieved. He perceived the church and the courts as hopelessly dominated by the myths and the orthodoxy that were the enemy of reason (see, e.g., Rossiter and Lare, 1963: pp. 290-95). This left only the legislative and executive branches of government and the educational system. Lippmann’s disillusionment with government during the war can hardly be exaggerated. As a member of Colonel House’s ‘Inquiry’ and then as a staff member of a military propaganda unit he was exposed to incompetence in the State Department, duplicity in the military information agencies, and most discouraging of all, near anarchy in the intelligence services available to the President. Lippmann’s view of the Congress can be appreciated best by reproducing a piece from a column he wrote for the New Republic in 1917:
The fact is the Congress of the United States has ceased to work…. This last session was the final stage in a process of decay. It was garrulous, wasteful, amorphous, frivolous and foolish. It wasted money like a drunken sailor and time like a babbling idiot. It could not think, it would not imagine, it could not organize, it could not act. It squabbled over trifles, grunted and squealed and rooted, and left the country in chaos (Lippmann, 1970: pp. 151-52).
Certainly in Lippmann’s mind this Congress was not an institution from which might be expected to emerge the creative public policy the nation desperately needed. Lippmann’s attitude to the academic world was always ambivalent. He maintained contact with his undergraduate mentors and he carried on a correspondence and conversation with innumerable professors over his long life. Indeed, Lippmann was perhaps the journalist most respected in the American academic world during the twentieth century. He received numerous offers of academic appointment and at one time was at least tempted by professorships at the University of Chicago and Harvard (Steel, 1980: p. 271). But he was at heart skeptical of the academic community, seeing in it so much of the conservatism and blind deference to authority that he was sure the world could no longer afford. Moreover he suspected that the academic life might scramble one’s brains. He complained bitterly in a column in 1915 about the agonies he endured in plowing through a current work in political science: ‘My temper grew worse as I reflected on the hypnotic effect of books done in this manner, on the number of men whose original vision is muffied by verbal red tape and officialism of the spirit’ (Lippmann, 1970: p. 98). He could not imagine himself teaching happily in a university cut off from the world of affairs. He was particularly loyal to Harvard, his alma mater, and served it in many ways, but even there his frustration and disillusionment often reached high levels. As an overseer and member of the visiting committees of both the Harvard Economics and Government Departments he detected what he thought was a lamentable lack of attention to interconnections among the social sciences. ‘There is,’ he said, ‘undue specialization and insufficient synthesis and coherence.’ He proposed to the Economics Department chairman, Harold Burbank, that only general social science courses be offered at the undergraduate level, ‘confining all specialized courses to the Graduate School.’ He was not surprised by the negative response. He concluded a letter to Arthur M. Holcombe, a professor in the Government Department, by saying: ‘I think we ought to speculate boldly, for it does seem to me, that the problem in the university is much more fundamental than we have yet admitted to ourselves’ (J. M. Blum, 1985: p. 376). Like Congress the university appeared not to be an institution equipped to answer the public policy needs recognized by Lippmann.
Between the wars Lippmann remained committed to the position expressed in Drift and Mastery that the essential regeneration of public policy must come from an elite of leaders in society committed to open-minded reason and imbued with the scientific method. The principal change in his views came in the definition and characterization of this elite. Drift and Mastery had drawn an optimistic picture of a large and growing class of enlightened and reasonable professionals, rather like Veblen’s Soviet of Engineers, facing all of society’s problems together and solving them sensibly, creatively, and by consensus. World War I darkened this picture considerably. There Lippmann saw social progress reversed on almost every front and the open search for truth replaced in many cases by fearful repression of intellectual activity. Global thinking, in particular, was a frequent casualty of war, replaced often by a narrow provincialism.
The public during the war had ‘been befuddled’ by poor news reporting, and by propaganda, manipulation, and distortion perpetrated by its own government. He was horrified at how well the deceptions worked. The conclusion he drew from this experience with censorship, misinformation, and disinformation was that the conception of widespread public understanding of and participation in public policy could be merely a dangerous and sentimental dream. The public simply was not up to it. He wrote to Felix Frankfurter in 1933:
I agree with you that the public needs education in the factors relevant to wise decisions. But I do not frankly believe it’s possible to educate the people on all the factors that are relevant to all the wise decisions that have got to be made in the next few weeks. It is utterly impossible to perform such a feat of education. The matters are too intricate, prejudices are too deep and complex, the technical knowledge is too lacking (J. M. Blum, 1985: p. 305).
Despite these doubts he remained no less convinced of the necessity for ‘mastery’ rather than mere ‘drift.’ But he worried now that any attempt to achieve mastery by implementing a Jeffersonian scheme of village intellectuals across America (even those with sound Veblenian instincts) puzzling over public policy was a recipe for parochialism and superficiality. In his important book Public Opinion Lippmann used new insights from social psychology to suggest how a typical citizen did, in fact, reach conclusions about policy questions and other problems – ‘not on direct or certain knowledge, but on pictures made by himself or given to him’ (Lippmann, 1922: p. 25). Regrettably ‘the pictures inside people’s heads do not automatically correspond with the world outside.’ Lacking the time and inclination to explore the complexities of public policy even intelligent and well-intentioned citizens fell back upon these ‘stereotypes,’ ‘blind spots,’ ‘allegories’ and other psychological devices – defined as ‘those fixed habits of cognition which usually, but not always, falsify the picture’ (J. M. Blum, 1985; p. 74). These images were ‘loaded with preference, suffused with affection or dislike, attached to fears, lusts, strong wishes, pride, hope.’ The cases he used to illustrate this ‘inadequate way of representing the world’ were remarkably ahead of his time. For example, he complained that the habit of thinking about progress as ‘development’ has meant that many aspects of the environment were simply neglected. With the stereotype of ‘progress’ before their eyes, Americans have in the mass seen little that did not accord with that progress. They saw the expansion of cities, but not the accretion of slums; they cheered the census statistics, but refused to consider overcrowding; they pointed with pride to their growth, but would not see the drift from the land, or the unassimilated immigration (Lippmann, 1922: p. 110).
Lippmann concluded that modem society lacked the institutions to permit widespread public participation in the policy process. Instead a much smaller elite must be enlisted, educated, and kept well informed. This elite had to be the proper audience for the policy analyst. There was no practical alterative if implementation of sound policy was to be the objective:
I argue that representative government, either in what is ordinarily called politics, or industry, cannot be worked successfully, no matter what the basis of election, unless there is an independent, expert, organization for making the unseen facts intelligible to those who have to make the decisions. I attempt, therefore, to argue that the serious acceptance of the principle that personal representation must be supplemented by representation of the unseen facts would alone permit a satisfactory decentralization and allow us to escape from the intolerable and unworkable fiction that each of us must acquire a competent opinion about all public affairs…. This organization I conceive to be in the first instance, the task of a political science that has won its proper place as formulator, in advance of real decision, instead of apologist, critic, or reporter after the decision has been made (Lippmann, 1922: pp. 31-32).
The question remained, naturally, of who in society should constitute this elite that would take advantage of the scientific knowledge that would be forthcoming from Lippmann’s vague new ‘organization’ for policy analysis. Was there still a case for broad citizen education? In Public Opinion Lippmann counted on people to explore policy problems mainly in the area of their own professional involvement and not the involvement of others. Where they had no authority, citizens must learn to trust and defer to expertise: ‘The only prospect which is not visionary is that each of us in his own sphere will act more on a realistic picture of the invisible world, and that we shall develop more and more men who are expert in keeping these pictures realistic’ (p. 314).
In his Godkin lectures (1934) Lippmann produced another reason why the public could not for their own good be involved too closely in all public policy. Some policy actions like the deficit finance advocated by J. M. Keynes were counter-intuitive to the layperson. ‘Managers of the compensatory devices’ had to be able to cope with ‘a continual contrariness to the public mood.’ It was possible sometimes but not always to make the case persuasively for counter-intuitive policy. At other times, ‘the prevailing opinion is not the opinion which the majority would hold if it understood the question.’
‘The question that arises immediately is how and whether the people will consent to a policy which calls for decisive actions which are in their longer interest but contrary to their immediate opinions. Will a democracy authorize the government, which is its creature, to do the very opposite of what the majority at any time most wishes to do?’ (Lippmann, 1935: pp. 74-80). The way had to be found he insisted to protect policy from the public’s erroneous intuition, as well as from the misrepresentation of private interests:
as the state becomes charged with collective duties implicating all the permanent interests of the nation, it must of necessity equip itself for the task by divorcing itself from the pressure of unconsidered and temporary opinions … when the state becomes active, the ways of democracy have either to be adapted to the new responsibilities, or democracy itself will be overthrown (pp. 78-79).
Perhaps the greatest source of danger, Lippmann thought, lay with the rich who used the ignorance of the poor to prevent the implementation of sound policy: ‘Although in theory the proletariat and the plutocracy are in conflict, in fact they tend to combine in a dangerous union and to dominate the state’ (p. 96). Lippmann found the best hope for resisting the machinations of the rich in the strengthening of the middle class who alone might come to accept principles of sound public policy in the wider public interest.
In the last part of Public Opinion Lippmann attempted to set out specifically institutional reforms that might respond to his concerns, and just what might constitute his proposed ‘organization’ for the delivery of sound public policy advice. In the process, he produced one of the first philosophical statements of the case for nongovernmental – or at least paragovemmental – public policy research institutions. He began with the observation that when social science was working well it was either ‘painful’ because it broke down stereotypes, or dull because it simply organized prosaically a multitude of facts. However the social sciences did not often work well. They had only begun to perfect an experimental research method and to gain intimate contact with their data. Their weakness became self-perpetuating because it reduced respect and attention from society, especially where social scientists themselves became social critics:
The man of affairs, observing that the social scientist knows only from the outside what he knows, in part at least, from the inside, recognizing that the social scientist’s hypothesis is not in the nature of things susceptible of laboratory proof, and that verification is possible only in the ‘real’ world, has developed a rather low opinion of social scientists who do not share his views of public policy (Lippmann, 1922: p. 372).
The social scientist would gain ‘dignity and strength,’ Lippmann concluded, ‘only when he acquired a clinical relationship to the decision makers of public and private policy, analogous to that of the physician or engineer.’ Today the sequence is that the man of affairs finds his facts and decides on the basis of them; then, some time later, the social scientist deduces excellent reasons why he did or did not decide wisely. This ex post facto relationship is academic in the bad sense of that fine word. The sequence should be one where the disinterested expert first finds and formulates the facts for the man of action, and later makes what wisdom he can out of comparison between the decision, which he understands, and the facts, which he organized (p. 375).
The answer to the problem of improving the methods of the social sciences, as well as of making them more useful to policy, Lippmann was convinced, lay in relating the disciplines to their subject matter with just the right degrees of intimacy and autonomy. In consequence he recommended that each executive department of government have attached to it an ‘intelligence bureau’ (a ‘body of research and information’) to ‘assemble knowledge’ for decision makers. The expert employed therein would ‘translate, simplify, generalize’ (Lippmann, 1922: p. 381). ‘By making the invisible visible, he confronts the people who exercise material force with a new environment, sets ideas £md feelings at work in them, throws them out of position, and so in the profoundest way, affects the decision’ (p. 383). In order to preserve the independence of this research staff it must have tenured employment, endowed funding, and conditions overall analogous to those of a university. Indeed he suggested that a ‘central agency’ coordinating these bureaus ‘would, thus, have in it the makings of a national university’ (p. 392). Possibly graduate students and visiting faculty from universities around the country would constitute a substantial part of the staff of this national university. He thought that competition among the research staff would be illuminating to decision makers and movement of staff into and out of the structure would help to assure the maintenance of quality over time: ‘if one could assume that there was circulation through the whole system between government departments, factories, offices, and the universities; a circulation of men, a circulation of data and of criticism, the risks of dry rot would not be so great’ (p. 394).
The Lippmann plan for a series of semiautonomous analytical units attached to departments throughout government to guarantee the omnipresence of reasoned policy analysis bears some similarity to the network of institutions typified by RAND and the Urban Institute that arose after World War II. The main mission of Lippmann’s intelligence bureaus was to improve the decisions of policy makers. But, incidentally, they would have two other effects. They would improve the sophistication of journalists, thereby helping in a modest way with public education, and they would lay the basis for a simplified body of policy doctrine appropriate for instruction in the schools:
‘There will accumulate a body of data which political science can tuck into generalizations, and build up for the schools into a conceptual picture of the world. When that picture takes form, civic education can become a preparation for dealing with an unseen environment’ (Lippmann, 1922: p. 408).
In The Phantom Public (1925), a short and pithy book that appeared three years after Public Opinion, Lippmann had lost any optimism he had earlier about educating ‘the public’ ‘as a conserving or creating force directing society to clearly conceived ends’ (Lippmann, 1925: p. 65). Instead, by this time he found the public to be a mercurial force potentially doing more harm with a little knowledge than with none at all. It is possible that public suspicion of the League of Nations may have deepened his cynicism. He wrote, ‘The public will arrive in the middle of the third act and will leave before the last curtain, having stayed just long enough perhaps to decide who is the hero and who the villain of the piece’ (p. 65). To compound the problem of the public’s short attention span, the ‘hardest controversies to disentangle’ were the ones so often placed before the public for action: ‘Where the facts are most obscure, where precedents are lacking, where novelty and confusion pervade everything, the public in all its unfitness is compelled to make its most important decisions. The hardest problems are those which institutions cannot handle. They are the public’s problems’ (p. 131). If the public could not be expected to grasp the truth and reach sound conclusions, Lippmann asked, what was the value of public debate? Perhaps, he suggested, it was just to ‘identify the partisans’ and their reasons for involvement. In particular where private interest was clothed in expression of public purpose this subterfuge could usefully be revealed by public debate. In the case of conflict between private parties, such clarity was especially important:
‘it is necessary to break down the fiction of identity, to insist that the quarrel of one business man with another is their quarrel in which each is entitled to a vindication of his right to fair adjudication but not to patriotic advocacy of his cause’ (Lippmann, 1925: p. 195).
Certainly Lippmann did not look for a frequent use of the plebiscite or for consultation with the public will to chart society’s course: ‘The proper limits of intervention by the public in affairs are determined by its capacity to make judgments’ (Lippmann, 1925: p. 141).
And to date these limits were highly circumscribed. Lippmann was prepared to abandon the democratic principle that aimed ‘at making of citizens a mass of amateur executives … the result is a bewildered public and a mass of insufficiently trained officials’ (pp. 148, 149). Lippmann accepted as regrettable reality the inevitable need for the political leader to engage in dissembling with an ignorant public:
he must defer to the force of opinion because that is where the power resides; yet he must deal with affairs in which public opinion is only a very partial, and almost always a nearly negative, guide to policy…. Between his guess at what the public wishes and his own best judgment of what the public needs, he generally manages to split his personality into two selves; neither of which is on friendly terms with the other’ (Rossiter and Lare, 1963: p. 461).
A crucial distinction for Lippmann was between ‘insiders and outsiders’ in the policy process. But he gave a particular meaning to these terms. The common citizen-outsider, he said, ‘is necessarily ignorant, usually irrelevant and often meddlesome, because he is trying to navigate the ship from dry land’ (Lippmann, 1925: p. 150). Lippmann was prepared to concede that from the outside ‘the public had a function and must have methods of its own in controversies.’ And, of course, he never questioned the democratic right of citizens to replace elected officials ex post who did not produce satisfactory policy outcomes (p. 197). But his heart and his mind now lay more and more with the potential contributions of insiders who had the means and responsibility to understand policy issues and whose function it was to advise and guide the politicians. John Dewey provided a kind of optimistic antidote to Lippmann’s growing pessimism about the relationship of the citizen to policy in The Public and Its Problems (1927, esp. p. 116n).
As the years went on Lippmann counted on dynamic and persuasive political leaders to explain effectively the need for the ‘right’ public policies (devised by enlightened insider policy analysts) to the public. He simply could not see these policies percolating up from below. The policies had to be justified downward clearly and convincingly. Churchill and de Gaulle were, he thought, masters of the art of public explanation. Harry Truman was at the other end of the scale. Lippmann was not optimistic that the right relationships could often be devised effectively among a society’s leaders, its insider-experts, and its democratic public. But this was the only model for which there was hope, and for it all must strive. The creation of a powerful ‘public conscience’ among these three elements should be given the highest priority.
We do not have, as yet, a body of intellectual and moral habits, customs, and attitudes to fit the realities of modern popular government. Our political consciences are the deposit of a single age when opinion was regulated by the traditions and the decisions of church and state and class. There is as yet no alterative public conscience suited to the present age in which opinion is free and the circulation of opinion so much determined by the supply and demand of accidental popular interest and so subject to the power of money and the control of mechanical resources (Rossiter and Lare, 1963: p. 307).
It was the role of the policy analysts, using the best social science available, to create and sustain this public conscience.
‘A wall against chaos’: The making of a policy analyst
Lippmann seldom wrote explicitly about the place in society of the policy analyst. The closest he came may have been in his reflections, first, on Plato’s conception of a guardian class with its own institutional support structure, and, second, on H. G. Wells’ description of a Samurai class in A Modern Utopia. Lippmann was dubious about the possibility that the conventional academic social scientist would ever become the ideal policy analyst serving the state as well as a scientific discipline. The problem, he thought, was the social scientists’ entirely understandable commitment to theory. Theoretical constructs of all kinds could, of course, be introduced into policy discussion but should not as they often did lead to tests of orthodoxy and limitation on thought.
Lippmann was led to the conclusion that while scholars, and particularly social scientists, had vital contributions to make to public policy, they should for their own good keep at least one step removed from the process. At times he claimed simply that the political and scholarly lives were incompatible. For example, he wrote: ‘It is impossible to mix the pursuit of knowledge and the exercise of political power and those who have tried it turn out to be very bad politicians or they cease to be scholars’ (Rossiter and Lare, 1963: p. 388). But he also probed the matter in greater depth and found that the problem lay in the distinction between the social sciences as science and politics as art. The first looked for generalizations and therefore constructed systems based on simplifying assumptions: ‘These assumptions must necessarily be simpler and more stable than those which are actually in play at any moment of decision’ (p. 512). On the other hand ‘the art of practical decision, the art of determining which of several ends to pursue, which of many means to employ, when to strike and when to recoil, comes from intuitions that are more unconscious than the analytical judgment’ (p. 511). It must be emphasized that Lippmann did not denigrate the function of economic, social and political theory in the world of affairs. Quite the contrary. Theory stood as an essential control over various pressures on day-to-day decisions. However, the scholar’s concern is with the formulation and establishment of modes of thought that underlie and might reorganize the prejudiced will, and cure it of that transiency which is the fundamental source of all our troubles. He does not manage the passing moment. He prepares the convictions and the conventions, the hypotheses and the dispositions which might control the purposes of those who will manage future events (p. 515).
The scholar ‘will build a wall against chaos, and behind that wall, as in other bleak ages of the history of man, he will give his true allegiance, not to the immediate world, but to the invisible empire of reason’ (pp. 514-15). For the scholar to do his job well he must be exposed to but also protected from the ‘chaos’ of the policy world.
Lippmann seems to have conceived of three distinct but often overlapping policy-oriented communities concerned with public affairs, each with its own culture, needs, and institution: (1) public servants, (2) scholars, and (3) unofficial insiders, that amorphous group of businessmen, journalists, former government officials, independent intellectuals and others closely involved in a policy area. Each community needed its own sustenance. For government the answer to the intellectual support problem was clear; it lay with the appropriate commissions, committees, agencies, and intellectual bureaus about which he wrote and which are discussed above. For the other two communities the solution was more difficult. First of all there was the problem of focus: the academics had their concerns and the insiders theirs; but the concerns were not identical. He was an enthusiastic admirer of independent, non-governmental policy-oriented research organizations, such as the Council on Foreign Relations and the Carnegie Endowment for International Peace, that brought scholars and insiders together to explore policy options, each on their own terms but for their mutual benefit. The principal question for such organizations was how to find financial support.
Indeed, Lippmann worried about how education, culture, and research of all kinds could be supported in a democracy. He applauded private philanthropy, such as that of the Rockefeller family, both for increasing available funds and for providing ‘undisturbed intellectual freedom.’ But he knew that private funds could never do the whole job and he speculated about how public support could be made ‘independent of the superficial currents of public opinions.’ As early as 1937,30 years before the National Endowments for the Arts and Humanities, he called for ‘some sort of public endowment … making publicly supported cultural activities independent of political control’ (Rossiter and Lare, 1963: p. 438).
Like John Bates Clark and James T. Shotwell at the Carnegie Endowment, Lippmann ultimately came to see the discipline of history as the most promising integrative tool and common denominator for policy ‘insiders.’ History could be a lingua franca, a means to achieve communication among those trained in more technical disciplines and an antidote to too much rigorous social science. Lippmann saw history both as a source of insight and as a continuing didactic device for policy analysts and policy makers:
One can learn from history. And no man should pretend to govern men who has not steeped his mind in the human tradition. But what history teaches is above all humility, that pride of opinion and easy certainty are folly, and then that he who would search for the lessons of experience will never reach the end (Rossiter and Lare, 1963: p. 522).
Lippmann’s high regard, especially during his later years, for the contributions of history seems to reflect a clear progression in his thought. From the days before World War I when he believed clever social scientists, like clever engineers, could invent and apply an effective device for any social problem he moved to the position that the social sciences were useful, but only within strict limits. Policy analysis formation, and implementation required a subtle art in which theory and the complexity of reality must be considered together.
An understanding of the ‘cultural tradition of a nation… the ideas, the premises, the rationale, the logic, the method, the values, or the deposited wisdom which are the genius of the development of Western civilization’ was as important to effective policy formation and implementation as an understanding of social theory (p. 418). Lippmann wanted more history introduced into the schools and colleges to prepare future insiders for later policy inquiry: ‘In developing knowledge men must collaborate with their ancestors. Otherwise they must begin not where their ancestors arrived but where their ancestors began’ (p. 422). Traditions of civility and continuity were passed on in the ‘mirror of history’ Lippmann insisted:
This continuum of public and private memories transcends all persons in their immediate and natural lives and it ties them all together. In it there is performed the mystery by which individuals are adopted and initiated into membership in the community. The body which carries this mystery is the history of the community, and its central theme is the great deeds and the high purposes of the great predecessors (Lippmann, 1954: p. 137).
Thus effective use of the social sciences to illuminate public policy required immersion also in the humanities and the arts.
Showing by doing: Lippmann’s own career as policy insider
In his life and career, Lippmann reflected many of the precepts contained in his writings. He portrayed himself publicly as just another Washington journalist and therefore a public affairs outsider (e.g., Rossiter and Lare, 1963: pp. 532-34). But in his private thoughts he surely recognized that he was the quintessential insider. He was equally comfortable in his contacts with politicians, businessmen, professionals, and scholars concerned with all aspects of public policy, and he took one of his intellectual missions to be that of bridge among them. With scholars, Lippmann was highly sensitive to what he took to be guild restraints on their thinking. He set out to pick up and use attractive ideas wherever he found them in academie without attending to such constraints.
He borrowed from notoriously conflicting sources within a discipline, and for this he was sometimes accused of being inconsistent. In his mind he was simply following the path of the open-minded, rational intellectual from whom social salvation must come, if from anyone. Lippmann’s attitude to economics illustrates this point. He was well acquainted with the essential elements of most important theoretical developments in economic science before and during his lifetime, and he integrated elements of them effectively in his policy discussions. Ancient Greek and Medieval Scholastic ideas about natural law supported his faith in the existence of ‘Universal law of natural order’ (Lippmann, 1954: p. 104). Smith and the classical economists, supplemented by Hayek and Mises, had shown to him the operation of a market system as one vital dimension of that order (Lippmann, 1937: p. 94). Lippmann was most skeptical of the marginalist economists of the late nineteenth century both because they seemed to have led the discipline into areas of arid esoterica and because they propounded a theory of income distribution that was simply out of touch with reality. He knew John Maynard Keynes, Lionel Robbins, and other prominent economists personally and he visited and corresponded with them. This enabled him to present their ideas promptly to the public, even though sometimes without all the complexities included. Often he dealt with the policy implications of economic ideas in his columns before the ideas had been well digested in the profession. But sometimes he was also in the vanguard in discovering complexities. He was among the first to be concerned about the negative effects on motivation and inflationary pressures of counter-cyclical fiscal policy (Rossiter and Lare, 1963: p. 352). The essential ideas of Galbraith’s Affluent Society can be found in Lippmann’s columns as early as 1957 (Rossiter and Lare, 1963: pp. 360-67, 432). He used what would become the concept of human capital as early as 1914 to suggest that investment in humans might be one way to limit wars. Aggressors, he observed, usually came from economies where life is cheap. They would be less profligate with human life if it were dear. He found that ‘public men’ were often reluctant to ‘publish the bad news from the economists,’ and this he sought to do himself, as in his explanation of the farm problem as one of over-supply (p. 368). The influence of ideas of economists from the left and the right can be seen in Lippmann’s letters and writings. He had high regard for Marx, and some variant of the theory of dialectical materialism lay behind much that he wrote.
Veblen’s notions of the instinct of workmanship, the role of the engineer, and the growing divorce of ownership from control in modem capitalist societies, were especially prominent in his early works as were John R. Commons’s ideas about the legal foundations of capitalism. Lippmann was a champion of a return to what is today called ‘political economy’ – the economics and politics of markets. He was certain that social and political considerations were fully as important as economic ones in much price determination, especially the fixing of wages and tariffs. He speculated, for example, that tariffs could be reduced only during periods of inflation (J. M. Blum, 1985: p. 331). Anticipating today’s fascination with the political role of rent seekers he called for greater attention to the place of special interests in policy formation and implementation.
A reexamination of the demands of the principal pressure groups … is a task for many specialists in many branches of a revivified political economy – a political economy, let us note, which reunites once more the study of politics and of economics. This false separation, which has caused scholars to drop the term ‘political economy,’ is almost certainly the consequence of the two cardinal errors which we have examined, of the preoccupation with laissez-faire in politics and of the misconception of the significance of the classical economists. Politics and economics have lived in two separate intellectual worlds only in the era when political science was the study of what could not be done and economics was the rationalization of what need not be done (Lippmann, 1937: p. 235n).
A remarkable accomplishment of Lippmann, as policy analyst, for which he has received practically no recognition, was interpretation for an American audience of the emerging policy conclusions of John Maynard Keynes. Lippmann was an early admirer of Keynes’s thinking, and he set out to bring it to the American people. He placed Keynes’s contribution on a par with that of Adam Smith’s treatment of the division of labor (Rossiter and Lare, 1963:p. 351). The most widely cited account of ‘How Keynes Came to America’ by John Kenneth Galbraith (1971: pp. 43-59; see also Galbraith, 1981: pp. 65-70) suggests that Keynes’s ideas did not reach Cambridge, Massachusetts until the publication of the General Theory of Employment, Interest and Money in 1936 when they arrived ‘with tidal force’ (Galbraith, 1981: p. 67). In fact, the essential Keynesian policy message was delivered to a large Harvard audience in the Godkin lectures of May 1934 by Walter Lippmann (see Steel, 1980: p. 305), published as a book entitled The Method of Freedom (1935).
Like many others, Lippmann had been very hopeful that the World Economic Conference in 1933 would lay the groundwork for a successful multinational solution of the Great Depression and he was in touch with Keynes on the subject. His friendship with Keynes went back to the Paris Peace Conference of 1919, when they were both members of the community of young intellectuals who gathered around the negotiators. They began to correspond
soon after about the League of Nations and other matters. In May 1933, Lippmann and Keynes gave together a transatlantic radio talk on the BBC about prospects for the conference – ‘something new in broadcasting.'” There, Keynes emphasized to Lippmann the duty of ‘powerful journalists like you’ to keep the public closely informed about the options presented for public reform, especially because President Roosevelt ‘seems more willing than most of those in authority in the world to have some kind of bold and constructive policy commensurate with our necessities.’
Keynes called for a coordinated Anglo-American policy against depression to include reduction in tariffs, price stabilization, devaluation of national currencies against gold, low interest rates, and public works. After the Conference failed to reach agreement, Keynes sent an open letter to President Roosevelt in December 1933 setting forth again a proposal to fight depression. Lippmann wrote to Keynes in April 1934 that ‘I am told that it [the letter] was chiefly responsible for the policy which the Treasury is now quietly but effectively pursuing of purchasing long-term government bonds with a view to making a strong bond market and to reducing the long-term rate of interest’ (Lippmann to Keynes, 17 April 1934, File AV/1, Keynes Papers).
Lippmann worried that programs under the National Recovery Act and other New Deal legislation were ‘a very serious check to our recovery’ because they mainly raised costs and constrained sales. Lippmann urged Keynes to contact Roosevelt once more ‘to show him the meaning of that point of his policy.’ Keynes replied (28 April 1934, file AV/1) that the time had come he must ‘for my own satisfaction, pay a visit of inquisitiveness to your side.’ And so he did, arriving in May 1934 for meetings that went on into June, including a celebrated hour with FDR and publication in the New York Times of an ‘Agenda for the President’ in which he called mainly for increased public expenditures (Moggridge, 1992: p. 583). It can be supposed that the American visit included more conversations with Lippmann.
In the Godkin lectures in May 1934, Lippmann did not dwell on details of the macroeconomic theory that Keynes was perfecting at the time. Indeed, he wrote to Keynes a decade later that ‘I write with great diffidence about these matters and I usually feel as if I were trying to talk a foreign language which I can only read a bit’ (Lippmann to Keynes, 23 March 1945, File L45). Rather, he dealt with the broad policy implications and political economy of these theoretical developments. He placed them in a large context using his command of philosophy, political science, and history. For reasons that are not clear, Lippmann did not mention Keynes’s name in the lectures. Lippmann set forth as his purpose in these lectures to provide ‘a statement of the principles by means of which, as I see it, a nation possessing a highly developed economy and habituated to freedom can make freedom secure amidst the disorders of the modem world’ (Lippmann, 1935: p. vii). He spoke, Lippmann said, at a time of inevitable intellectual revolution. Old ideas, and policies based on these ideas, had demonstrated their ineffectiveness and were bound to be replaced: ‘It is only when established custom does not any longer work the expected results, when the whole organization of men’s lives is in confusion, that a generally revolutionary condition exists. The people listen to unfamiliar ideas when their familiar routine has broken down’ (p. 5). Such a time had arrived. The onset of depression and breakdown of international economic cooperation had brought on the revolution:
‘The summer of 1931 may be taken, I think, to have been the moment of transition from the past into the present’ (p. 10). The times were especially unstable, he said, because the appeal of laissez-faire market capitalism was mainly pragmatic and not ideologically based. Its continued acceptance was based on deliverables, which were no longer forthcoming: ‘A social order, which does not command the moral loyalty of its people, which is sustained not by their conviction but by their satisfactions, is inherently unstable and unreliable’ (p. 15). When this system failed to deliver the ‘material benefits’ it promised, its participants searched for an alternative. The essence of the present crisis, Lippmann reported, was that the equilibrating institutions of the world economy (which he called the ‘Great Society’) had been inadequate to cope with the dislocations of World War I (the ‘Great War’): ‘the self-regulation and self-adjusting character of the old order had been destroyed’ (p. 18).
Individual nations had been persuaded to look for salvation in isolation, and ‘of course the more they did this, the more they dislocated the Great Society itself; their separatism became the most active agent in producing the evils against which separatism seemed the only practical defense’ (pp. 21-22). The cascading collapse of the economic activity created a widespread sense of insecurity among the populace and the strongest ‘revolutionary impulse.’ What was driving the people of the world at the moment was a ‘passion for private security in the midst of public disturbance’ (Lippmann, 1935: p. 24).
Thusfar the people had perceived only two directions into which they might move: either a further crippling of the free market system through ‘trusts, mergers, combines, holding companies and cartels’ each designed to protect some special interest. This was the path of the NRA and the early New Deal, the approach he called ‘a Directed Economy.’ The other alternative was total economic planning embodied in the fascism emerging in Europe and the communist system of the Soviet Union, which he called ‘Absolute Collectivism.’
The new third path of national economic policy that was just becoming clear, Lippmann said, could be called ‘a Compensated Economy; or Free Collectivism’ (Lippmann, 1935: p. 38). It is collectivist because it acknowledges the obligation of the state for the standard of life and the operation of the economic order as a whole. It is free because it preserves within very wide limits the liberty of private transactions. Its object is not to direct individual enterprise and choice according to an official plan but to put them and keep them in a working equilibrium. Its method is to redress the balance of private actions by compensating public actions.
The system of free collectivism originates not in military necessity but in an effort to correct the abuses and overcome the disorders of capitalism (p. 46). The ideas, and even the use of language, in this passage are strikingly similar to those in chapter 24 of Keynes’s General Theory of Employment, Interest and Money (1936), entitled ‘Concluding Notes on the Social Philosophy Towards which the General Theory Might Lead.’
The essence of the problem of capitalism, Lippmann said, was that a free market system left to itself could not cope with massive disruptions such as those resulting from war. ‘It has become necessary to create collective power, to mobilize collective resources, and to work out technical procedures by means of which the modern state can balance, equalize, neutralize, offset, correct the private judgments of masses of individuals’ (Lippmann, 1935: p. 50).
Up to now, the main devices for compensation were central bank operations to buy and sell securities and manipulate the discount rate. These devices were no longer ‘effective enough. They may work in the long run. But the long run is too long’ (pp. 52-53).
A second, more promising, method of compensation for fluctuations in the private sector was through fiscal policy: ‘The state is itself a great employer, a great consumer, a great investor, and a great borrower. It can in theory, – and with experience it can probably learn how actually to do this, – time its operations so as to offset and balance the actions of private employers, consumers, investors, and borrowers’ (Lippmann, 1935: p. 53). On the revenue side taxes can be raised so as to discourage all enterprise or any particular enterprise. They can be lowered in order to encourage all or any particular enterprise. They can be used to curtail consumption or capital investment. They can be used to encourage them. An ideal system of taxation would, therefore, be flexible so that rates rose when business was tending toward a boom and fell when it was slowing down. It could also be discriminating so as to encourage or discourage saving with a view to preserving the equilibrium between saving and investment’ (p. 54).
A third policy option, Lippmann wrote, was ‘the state’s control over the rates charged by common carriers and public utilities. These rates ought to rise in the upward phase of the business cycle and to fall in the downward phase’ (Lippmann, 1935: pp. 54-55). A fourth option is to affect ‘the balance of payments across the national boundaries’ through ‘a manipulation of tariffs, bounties, and through public control of the volume and at least the general direction of foreign investments’ (pp. 55-56).
The point that Lippmann emphasized through these lectures more than any other was that the new policy of compensation for market failures was the only way to save capitalism as well as the freedom of choice and political liberty which could be its hallmark. Under absolute collectivism, be it of the fascist or communist type, the government is in fact the master, the citizen a subject and a servant. Under free collectivism, the government in its economic activities is in effect a gigantic public corporation which stands ready to throw its weight into the scales wherever and whenever it is necessary to redress the balance of private transactions…. The object of the state’s intervention is not to supplant this system but to preserve it by remedying its abuses and correcting its errors…. In the practice of statesmanship the compensatory method is, I believe, an epoch-making invention…. It provides both for individual initiative and collective initiative. The one is not the substitute for the other. The two are complementary. It is the method of freedom (pp. 57-60).
A striking feature of Keynesian economic thinking, when it arrived in America in the late 1930s and 1940s, was the speed with which its policy prescriptions were accepted by the business elite (see Collins, 1981). Lippmann’s effective interpretation of the implications of Keynes’s thinking must have helped to pave the way.
Lippmann devoted the final part of the Godkin lectures to what we would call today the political economy of macroeconomic policy. The main question to be faced was whether ‘free collectivism is incompatible with political democracy.’ He concluded that the answer was, not necessarily. Compensatory macroeconomic policy in the same way as a system of free markets could ‘be threatened by special interests representing the very rich (the plutocrats) and the very poor (the proletarians)’: ‘By the proletariat I mean those who do not have property or a dependable occupation which assures them £ in income for their principal needs. By the plutocracy I mean those who have more income than they need for their personal use and enjoyment’ (Lippmann, 1935: p. 95). ‘Although in theory the proletariat and the plutocracy are in conflict, in fact they tend to combine in a dangerous union and to dominate the state’ (p. 96). The best hope for implementation of sound economic policy, he felt sure, was the strengthening and maintaining of a prosperous and well-informed middle class. It was necessary to ‘fortify the regime of liberty upon a foundation of private property’ (p. 103). It was necessary to recognize ‘the right to work as one of the rights of man’ (p. 107) and this could only be achieved by a public commitment to full employment:
A nation cannot impoverish itself by employing its labor to improve its resources and its equipment. It is not production but idleness, – it is unused materials and unused men – that are in the long run intolerably expensive… . It is from them that are drawn the evil powers by which the state is corrupted, and it is only by a policy which renders them secure that the modem state can itself be secure (pp. 108-10).
In addition to serving himself as a bridge between the social science disciplines and the policy elite and providing a means for ideas like those of Keynes, Veblen, or Hayek to be grasped by a policy elite through his books, articles in the New Republic and columns in the New York Herald Tribune, Lippmann was also much involved with nongovernmental research institutions that emerged during his lifetime to perform the functions discussed. His participation in the New York Council on Foreign Relations is illustrative. Lippmann was one of the most active leaders of both the research and publication programs during the first two decades of the Council.
He was close to Hamilton Fish Armstrong, the editor of Foreign Affairs, until their estrangement in 1937. He contributed frequently to Foreign Affairs, he edited two volumes of the annual survey, and he was considered at one time for the directorship of studies. He was also close to Russel Leffingwell (J. P. Morgan’s partner), Dwight Morrow and other prominent Council leaders. It cannot be said simply that Lippmann’s ideas held sway with these men or that his prescriptions, implied or explicit, for the role of the Council were accepted formally by the membership. Undoubtedly his views were respected. But more important, it appears that Lippmann reflected and articulated the views that others in the Council held more or less consciously.
His conception of a limited elite engaged in and capable of understanding foreign affairs in depth was appreciated especially by those who saw themselves within this select category. Lippmann’s definition of ‘insider’ was sufficiently vague so as to encompass virtually all of those invited to Council membership. His injunction that any larger elite, and certainly the mass public, be ignored by an institution such as the Council was well received in a membership organization that was uncomfortable with education of the wider public at the best of times. The justification of the Council in Lippmann’s writings as an institution in which scholars, businessmen and governmental figures exchanged theory for fact in an atmosphere heavy with social science and history went right back to the planning sessions in Paris in 1919 and confirmed the Council’s essential self-image and preferred social role.
The functions for the Council that Lippmann envisaged were continuing education for the members and research all folded together and aimed always at practical questions of policy. These were the functions others saw as well, only less clearly. As the years went on Lippmann may have become less certain in his own mind about just what he meant by notions like the ‘traditions of civility’ required for good policy judgment; but he believed that whatever those were they could be cultivated best in institutions like the Council that nurtured the right ‘bent of mind.’ For example, he suggested in 1963:
The real preparation for a creative statesmanship lies deeper than parties and legislatures. It is the work of publicists and educators, scientists, preachers, and artists. Through all the agents that make and popularize thought must come a bent of mind interested in invention and freed from the authority of ideas. The democratic culture must, with critical persistence, make man the measure of all things (Rossiter and Lare, 1963: pp. 385-86).
Lippmann saw the CFR as enabling an elite of foreign policy insiders to deal creatively with the continuing challenges facing them. It was a mechanism that exposed the practitioners in the foreign affairs community to leaders of the private sector, brilliant scholars and bright ideas of potential usefulness to policy; the scholars who were willing to accept the formula were given a window on the real world and led thereby to interdisciplinary cooperation, to reliable data by which to test their theory, and to the policy agenda of those with responsibilities for action. The Council was a valuable social and political institution aimed to foster creative thought critical to the survival of liberal democracy.
Walter Lippmann’s contributions were so many to the burgeoning field of policy analysis in the twentieth century that a summary of them is difficult. He asked many of the important questions that remain critical today, and he provided insightful answers that are valid still. Over the course of his life his ideas evolved, and even at one time there were inconsistencies. There were, for example, fundamental tensions between his commitment to democracy and his doubts that the mass of voters would always settle on wise policy. He concluded that all of human understanding may be relevant to policy and that no single discipline has a monopoly of insight. He was particularly intrigued by economics and he ransacked this discipline for ideas that could illuminate policy problems and suggest solutions. But he was also uneasy about the narrow behavioral assumptions of microeconomics and he came to favor history as an integrative policy discipline. He did not address the emerging question of whether a separate discipline of policy science should be created, but it can be argued that he pointed toward one. He certainly yearned for a return to something like the political economy of the classical economists, incorporating the two disciplines of economics and political science.
He was anxious to discover where in society policy analysis could best be performed and consumed. This led him to reflect on the organization of the social sciences as scholarly disciplines, the content of college and university teaching, the need for autonomous analytical units inside government and out, and on the problem of educating and sustaining those policy ‘insiders’ in society who have no governmental or academic home but who need to understand the scientific approach to issues that concern them. Increasingly, Lippmann came to appreciate that for their own good the social sciences must remain theory-based and insulated to a degree from the world of affairs and the practice of government. Moreover, he concluded that policy analysis is in part an art, dependent on the social sciences but having an agenda and style of its own. This required that policy analysis take place within specially designed structures, of the kind that today dot the academy, government, and the public affairs landscape. He was conscious of the role that enlightened private philanthropy played in sustaining sound policy analysis in the private sector. Lippmann’s growing doubts about the capacity of the wider public to deal effectively on its own with complex policy subjects led him to emphasize the importance of public education and the place of strong and persuasive leaders in a democracy.
As a pioneer himself of policy analysis, Lippmann demonstrated effectively how a policy insider may indeed serve as a bridge among the policy communities. As America’s most respected journalist, he picked up from scholarly contacts one idea or theoretical insight after another and explained what significance they had for society. His pathbreaking exposition of Keynesian macroeconomics is only one example of his skill. But Lippmann’s contribution was not a one-way flow. He also brought news of the real world to those in the ivory tower.
Because so many of the issues that Lippmann raised and discussed repeatedly over his lifetime remain vital and unsettled, his writings retain a freshness and relevance today. This article has emphasized his reflections on the place of experts in the policy making of an industrial democracy. On questions of the environment, international economic cooperation, fiscal policy, and the preservation of peace his writings also have a surprisingly contemporary ring. Reinhold Niebuhr described him as ‘one of the great educators preparing a young and powerful nation to assume responsibilities commensurate with its power and to execute them without too much self-righteousness’ (Rossiter and Lare, 1963: p. xii). Lippmann’s observations about the place in a democracy of what is called today ‘civil society’ make his observations equally relevant for the American nation that is now a little more mature than in his own day and for new nations that are facing these questions for the first time.
1. Students of Walter Lippmann today are privileged to have at hand a marvelous biography (Steel, 1980) and an excellent selection from his voluminous correspondence (J. M. Blum, 1985). Some of his early writings have been collected in Lippmann (1970) and others in Rossiter and Lare (1963). A recent study of his political thought is Rieeio (1994). Transaction publishers has produced new editions of several Lippmann books, including Lippmann (1925). The context in which Lippmann’s early intellectual development took place is described in Ross (1991) especially in ‘Part UI. Progressive Social Science, 1896-1914.’ Even after Franklin Roosevelt took office Lippmann found the complex bureaucracy and ‘brains trusts’ of the New Deal inadequate for the purpose of advising a President on major policy issues. In 1936 he proposed formation of a ‘presidential secretariat’ remarkably like what would become the Council of Economic Advisers a decade later ‘to deal mainly with questions of fiscal policy as they were affected by the many departments of government’; he explained that ‘a presidential secretariat should be more than an agency of supervision and coordination of administrative policy. It should sift, analyze, and prepare for the President’s judgment all the questions that come up to him for decision. We treat the President as a man in our government, when as a matter of fact he is an institution, like the Crown. The presidential form of government will be workable in the long run only if the presidency operates as an institution and not merely as a one man show’ (J. M. Blum, 1985: p. 354).
Their friendship on a Walter-Maynard basis lasted over almost 40 years, with each visiting the other on trips across the Atlantic. They used each other quite openly for their own purposes, given their respective places in the policy process. Lippmann picked Keynes’s brain for relevant new ideas and for articles in the New Republic while Keynes used Lippmann as a way to reach a wide American audience. During World War II, Keynes even suggested that the British Government secretly subsidize the republication of Lippmann’s columns worldwide because his views were so much in accord with British interests (Keynes to Lord Macmillan, 14 December 1939, Keynes Papers). C. A. Siepmann (of the BBC) to Keynes, 21 April 1933 (file BR/2, Keynes Papers). Keynes set forth his ideas for Lippmann in a long letter of 26 May 1933 (file BR/2, Keynes Papers). Lippmann responded in a cable of 3 May 1933 (file Br/2, Keynes Papers). The discussion was reproduced in The Listener, 14 June 1933, p. 231.
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Blum, D. Steven (1984). Walter Lippmann: Cosmopolitanism in the Century of total War. Ithaca: Cornell University Press.
Blum, John Morton, ed. (1985). Public Philosopher: Selected Letters of Walter Lippmann. New York: Ticknor and Fields.
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