Ideas,Policy Feedback and the American Political Economy

Abstract

In their volume The American Political Economy, Jacob S. Hacker et al. seek to renew the study of American political economy (APE) through a direct engagement with other areas of political science, including and especially comparative political economy (CPE). In the introduction of their volume, they lay out the foundations of APE as both a field of research and an approach to American politics that seeks to contribute to the study of the United States as well as to the broader discipline of political science. In this review essay, I will discuss the APE as an intellectual project to stress its key assumptions and its potential contribution to the study of politics and public policy, in the United States and beyond. Then, I will discuss two key issues that, while not explicitly central to APE as developed in The American Political Economy, could help enrich this novel approach. These two issues are policy feedback, a concept already prominent in the institutionalist tradition APE draws on, and the role of ideas in politics, which in recent decades has gained more currency in the study of politics, public policy and CPE.

Introduction

The field of American politics has long made a strong contribution to political science as a discipline. Yet, due to its potentially inward-looking nature, this field can become out of sync with important developments in other areas of the disciple. In this context, it is healthy for students of American politics to borrow from comparative politics and other subfields of political science to enrich and renew their area of study. In their recent volume, The American Political Economy, Jacob S. Hacker et al. (2021) seek to renew the study of American political economy (APE) through a direct engagement with other areas of political science, including and especially comparative political economy (CPE). In the introduction of their volume, on which we focus in this review essay, they lay out the foundations of APE as both a field and an approach to American politics that seeks to contribute to the study of the United States as well as to the broader discipline of political science. In this essay, I will discuss the APE as an intellectual project to stress its key assumptions and its potential contribution to the study of politics and public policy, in the United States and beyond. Then, I will discuss two major issues that are not explicitly central to APE as developed in The American Political Economy but could help enrich this novel intellectual project. These two issues are policy feedback, a concept already strongly associated with the institutionalist tradition APE explicitly borrows from (Béland et al., 2022; Pierson, 1993; Skocpol, 1992), and the role of ideas in politics, which in recent decades has gained more currency in the study of politics, including in the field of CPE, which is the explicit starting point of APE (Blyth, 2002; Campbell, 2004; Schmidt, 2011).

The APE

In The American Political Economy, APE is introduced not only as a field of study but also as an approach that ‘emphasizes that politics is a developmental process in which outcomes, institutions, and power relations are forged through long-term conflicts within and across multiple institutional venues’ (Hacker et al., 2021: 2). Although some of these issues are central to CPE, it does not emphasize what is specific about American politics, which is why the creation of APE is necessary as a distinct approach is necessary in the first place. Yet, while Hacker et al. (2021) are interested in the distinct features of the APE, their project is not centred on the concept of ‘American exceptionalism’. Instead, they ‘believe focusing on the unusual features of the American political economy will both enrich the work of American-focused scholars and contribute to the understanding of other advanced democracies’ (Hacker et al., 2021: 13). This comparative perspective on the United States is refreshing, as most students of American politics today focus exclusively on one country (theirs) and show little interest for comparative analysis and international political science. By drawing on CPE and other international approaches in political science to build APE as an approach, Hacker et al. (2021) make American politics as a subfield less inward-looking, which is a positive development for both American and foreign scholars interested in the study of political economy, in the United States and elsewhere around the world.

Yet what is political economy, exactly? For Hacker et al. (2021: 4), political economy is ‘the study of how economic and political systems are linked. As a field of inquiry, political economy is premised on the idea – amply borne out by research in the field – that these linkages are very strong and very important’. Because political institutions strongly influence economic institutions and vice versa, the analysis of political economy should be central to the study of American politics. Yet, Hacker et al. point to its relative neglect, as ‘much of the energy of Americanists has been directed toward the study of individual political behavior: elections, public opinion, political participation, and so on’ (Hacker et al., 2021: 9). Simultaneously, because they typically ‘study American politics in isolation’, Americanists ‘have limited incentive or leverage to examine the striking differences among rich democracies. As a result, they often take for granted highly consequential features of the United States’ (Hacker et al., 2021: 9). One of the key objectives of APE as an approach is to explore these consequential features while engaging with CPE.

Drawing on CPE scholarship, Hacker et al. (2021: 12–13) identify three dimensions directly consequential for political economy in which the United States is a clear outlier. First, ‘The United States has a uniquely fragmented political system’ (Hacker et al., 2021: 12). This fragmentation is related to factors such as federalism, the role of courts and, more generally, the existence of multiple venues for political conflict. Second, economic fragmentation is a major feature of American society, as interest organizations are atomized, and both labour and state institutions are weak (Hacker et al., 2021: 12). For Hacker et al. (2021: 12–13), the United States is the purest and most radical ‘liberal market economy’, a concept borrowed from the varieties of capitalism literature, a well-known perspective in CPE (Hall and Soskic, 2001). Third, ‘Racial divisions are constitutive of the American political economy’ (Hacker et al., 2021: 13). Such divisions weaken the push for improved redistribution and public goods while exacerbating regional inequalities central to American federalism.

Considering these features of the United States, as an approach, APE has three main foci: institutional fragmentation, coalition building among collective actors, and the role of race in politics and public policy (Hacker et al., 2021: 14). First, APE explores the nature and impact of the unusually high number of veto points (Immergut, 1992) in the United States. This multiplication of veto points is related to both federalism and an ‘extreme separation of powers’ (Hacker et al., 2021: 15). By emphasizing institutional decentralization and fragmentation leading to the multiplication of venues for political influence, APE implicitly draws on historical institutionalism (HI) (Steinmo et al., 1992), an approach that has stressed the specific nature of political institutions in the United States, including the role of checks and balances, federalism, court decisions and both limited and fragmented state capacity (Skocpol, 1992).

Second, APE focuses on ‘coalition building within a fragmented polity’ (Hacker et al., 2021: 19), which concerns how

the multiplicity and diversity of venues in America’s fragmented system profoundly alters the terrain of political contestation, advantaging organized actors with the resources and reach to venue shop, while creating powerful incentives for individuals and organizations to hoard resources and free-ride on public good provision (Hacker et al., 2021: 20).

Here, APE is grounded in the assumption that, in such a fragmented polity, well-organized interests are much more likely to achieve their political goals than disorganized interests such as the ‘broad electorate’, which faces an environment where ‘policy is increasingly made in venues that are more complex and more isolated from direct electoral oversight than are Congress or the presidency’ (Hacker et al., 2021: 21). In this context, APE puts forward a shift of emphasis from electoral and public opinion research, which currently dominates the field of American politics, to the study of organized interests and their mobilization across the many and sometimes more obscure corners of the fragmented American political system.

Third, APE emphasizes the study of racial inequality as it is closely intertwined with deeply embedded aspects of economic and territorial inequalities ever-present across the United States, including within its highly decentralized federal system. Here Hacker et al. (2021: 24–27) draw on the rich scholarship on race and American politics associated with scholars such as Joe Soss and Vesla Weaver (2017), who have explored the concentration of racial disadvantaged in the United States over time. Taking this into account, at a more general level, APE studies how ‘race is deeply embedded in structures of public and private governance that define the United States’ distinctive policy economy’ (Hacker et al., 2021: 27). Therefore, racial inequality is, alongside institutional fragmentation and coalition building, one of the three main foci on APE, which make it distinct from CPE.

As a framework, APE allows scholars to study many important topics explored in the substantive chapters that comprise The American Political Economy. These topics range from corporate power and the fragmentation of the American labour movement to the territorial politics of race and the development of the knowledge economy in the United States. What these substantive chapters suggest is the insightfulness of combining the close attention to the relationship between market and political institutions at the core of CPE while paying close attention to the distinct features of the political system, organized interests and patterns of (racial) inequalities in the United States. This combination of a comparative outlook with an explicit focus on what is specific about the United States makes APE a close relative to both American Political Development (APD) and HI, two approaches that typically draw on broad comparative theoretical insights to study American politics (Fioretos et al., 2016; Orren and Skowronek, 2004; Steinmo et al., 1992; Valelly et al., 2016).

Yet, as it stands, APE could be enriched by bringing in two factors that are only alluded to in The American Political Economy but that deserve more attention in the study of American politics and public policy, something already made clear in the existing APD and HI literatures, which APE could borrow more explicitly from. Because these two factors, policy feedback and the role of ideas, are also present in the CPE literature and mentioned in several empirical contributions featured in The American Political Economy (e.g. on policy feedback see Thurston, 2021: 146–148; and on the role of ideas see Barnes, 2021: 359, 363, 373), the formal integration of these two components to APE is both appropriate and logical. Keeping this in mind, in the two sections, I will draw on CPE, APD and HI to explain why both policy feedback analysis and the study of the role of ideas should become key components of APE research moving forward.

Policy Feedback

Policy feedback refers to the ways in which existing policy legacies create constraints and opportunities for policymakers. More generally, policy feedback, which emerged as a key concept within HI three decades ago, is about how existing policies shape politics over time (Béland et al., 2022; Campbell, 2003; Mettler, 2005; Michener, 2019; Pierson, 1993; Skocpol, 1992; Soss and Schram, 2007). Interestingly, although the concept of policy feedback is consistent with the emphasis on developmental pathways at the core of APE as an approach, this term only appears four times in this 418-page long volume, and it is not mentioned once in its introductory chapter. This is the case because the temporal approach to politics and public policy is relevant to address at least two key issues raised in The American Political Economy.

First, there is much evidence that feedback effects from existing public policies shape the development of organized interests, a central topic for APE discussed above. For instance, in her now-classic book Protecting Soldiers and Mothers, Theda Skocpol (1992: 58) shows that ‘new policies affect the social identities, goals, and capabilities of groups that subsequently struggle or ally in politics’. In this context, the design and nature of existing policy legacies influence how groups organize over time to shape these very policies. In that book, Skocpol (1992) demonstrates how the expansion of Civil War pensions in the late nineteenth and early twentieth centuries created incentives for Northern veterans to mobilize politically with the goal of seeking higher federal pension benefits. As the work of Paul Pierson (1994) suggests, decades later and over a long period of time, Social Security favoured the development of powerful constituencies associated with AARP, which has long fought against retrenchment attempts targeting these social insurance programmes for older Americans. The example of Social Security points to a larger trend according to which existing public policies directly affect interest group formation over time (Pierson, 1993: 599). More recently, other historical institutionalist scholars such as Andrea Louise Campbell (2003) and Suzanne Mettler (2005) have shown that constituencies shaped by policy legacies also include mass publics, as existing public policies affect public opinion and voting behaviour over time. In this context, one can argue that policy feedback shapes both individual behaviour and attitudes as well as organized interests (Béland et al., 2022). Considering this, policy feedback as it relates to the development of political constituencies over time should explicitly become a central aspect of APE as an intellectual project.

Second, and relatedly, policy feedback research has now directly contributed to the study of race in American politics (Lerman and Weaver, 2014; Michener, 2019; Soss and Schram, 2007). Because race is a key concern for APE, this emerging stream of policy feedback research is particularly relevant here. As Jamila Michener (2019) argues, in the United States, policy feedback is frequently intertwined with the politics of race. This is the case because

Policies often channel resources unevenly and inequitably across racial groups; racial stratification is a key determinant of the advent, alignment, and power of interest groups; and race is a fundamental prism through which experiences of policy are understood and interpreted (Michener, 2019: 425).

Starting from this insight while reacting to the piecemeal approach to race in the existing policy feedback literature, Michener (2019: 427) introduces what she calls the racialized feedback framework (RFF), which has two main components.

On one hand, RFF ‘addresses when race should be a dominant feature of feedback studies’ in the United States (Michener, 2019: 427). According to Michener (2019: 427), two conditions are crucial to assessing whether race is an ‘imperative part of policy feedback’. The first of these conditions is disproportionality, which refers to how ‘policies vary widely with regard to how evenly they distribute benefits and burdens across racial groups’ (Michener, 2019: 427). The second of these conditions is decentralization, which points to how ‘policies vary in the degree to which the mechanisms for distributing such benefits and burdens are centralized’ (Michener, 2019: 427). In the United States, the issue of decentralization is directly related to federalism, another key issue for APE. More generally, Michener (2019: 427) argues that ‘that scholars should be more compelled to embed race in their analyses of policy feedback when the policies under consideration are heavily disproportionate and/or significantly decentralized’. On the other hand, RFF ‘tackles how race can be incorporated into research on feedback’ by mapping ‘feedback types (attitudinal, behavioral, non-feedback) and levels (elite and mass) to prevailing research on race, ethnicity, and politics (REP)’ (Michener, 2019: 427). What this means is that the interaction between race and policy feedback operates in different ways and at different levels, sometimes, that depends largely on the nature of the policies under investigation. These remarks about the importance of policy feedback for the study of organized interests and of race relations suggest that paying close attention to the potential feedback effects from existing policies is essential to analysing issues central to APE as an approach. Thus, we should systematically integrate this concept to the study of APE.

Beyond these general remarks, what is important about the need for students of APE to engage systematically with the concept of policy feedback is the fact that the rich literature on this topic offers distinct analytical tools that these students would benefit from using. A key example here is the distinction between self-reinforcing and self-undermining feedback effects analysed by Alan Jacobs and R. Kent Weaver (2015; see also Weaver, 2010). According to them, while it is common to study self-reinforcing processes through which existing policies become more entrenched over time, scholars pay much less attention on average to self-undermining processes through which these policies can become less and less sustainable over time due to chaining demographic, economic and/or political circumstances (Jacobs and Weaver, 2015). Certainly, the call of Jacobs and Weaver to study both self-recording and self-undermining developmental patterns in public policy is relevant for the study of APD, and it is just one example of how engaging systematically with the rich and multifaceted policy feedback literature would prove helpful to APE scholars.

Ideas

Another tradition associated with the institutionalist tradition in political science is the study of the role of ideas (Béland, 2019; Béland and Hacker, 2004; Campbell, 2004; Hall, 1993; Orenstein, 2008; Parsons, 2007; Schmidt, 2011). Like the concept of policy feedback, analysing ideational processes can help improve the analysis of issues crucial for APE. Referring to the assumptions and perceptions of political actors, ideas are a broad concept that can be broken down into subcategories such as frames, programmes, policy paradigms and public sentiments (Campbell, 2004). Associated with a logic of interpretation (Parsons, 2007), these different ideas can affect political behaviour in ways that are especially meaningful for the study of APE, alongside the institutional and structural factors so central to The American Political Economy volume. As examples, here we focus on the same two issues discussed above in the section on policy feedback: (organized) interests and the politics of race.

First, interests belong both to the logic of position and the logic of interpretation, which makes it a rather fuzzy concept (Parsons, 2007). On one hand, interests do reflect the economic, institutional and social position of political actors, a situation that affects their preferences. This is the traditional understanding of interests, which is featured in the introductory chapter of The American Political Economy (Hacker et al., 2021). On the other hand, these preferences are not necessarily a mere refection of the position of these actors. For instance, several political actors sharing the same basic institutional position can end-up understanding their interests differently (King, 1973). Simultaneously, the perceived interests of one political actor can change sometimes quite dramatically over time, something that is more likely during major economic crises, during which growing uncertainly is likely to call into questions some of assumptions and preferences of individual and collective actors (Blyth, 2002). Overall, scholars have long argued that ideational processes help political actors make sense of their interests (e.g. Blyth, 2002; Hay, 2011; King, 1973; Schmidt, 2011; Stone, 1997; Weir, 1992).

These remarks do not mean that interests are just subjective constructions, a radical position articulated by Colin Hay (2011). In fact, the challenge for APE is to grasp the ideational side of interests (logic of position) as it interacts with its institutional and structural side (logic of interpretation). This also suggests that, despite attempts to move in that direction (Marsh, 2009), returning to a purely structural understanding of interests is impossible once we have acknowledged their ideational side. Simultaneously, recognizing the ambiguous and dual nature of interests should not necessarily lead us to follow Craig Parsons (2007) and reject the concept of interests altogether. For APE scholars, the challenge is to pay attention to the ideational side of interests, especially when the preferences of the individual and collective actors they study change quite suddenly or are different from the preferences of actors who share the same basic economic and institutions position. More generally, recognizing the ideational side of interests is helpful to grasp asymmetrical power relations, as the framing and reframing of perceived interests is central aspect of political life, within the field of political economy and beyond (Béland, 2010).

Second, turning to the role of ideas is helpful to explore the politics of race that is so central to APE (Bleich, 2003; Hansen and King, 2001; Lieberman, 2002; Lieberman, 2011; Smith, 2015; Thompson, 2016). This is the case partly because ideas shape the racial categories and what Charles Tilly (1999) calls categorical inequalities, which feature race prominently. One way to understand this is to stress how racial beliefs are embedded in cultural categories that are an inherent part of policy legacies (Steensland, 2008). This is where policy feedback and the role of ideas interact, especially through what Anne Schneider and Helen Ingram (1993) have called the social construction of target populations, which can have strong racial undertones in the United States.

Although racial inequalities typically refer to the logic of position, in terms of income and institutional status, the interpretative side of these inequalities and how political actors seek to reduce them by putting forward specific policy responses point directly to the role of ideas (Lieberman, 2002). More specifically, as elsewhere, ideas play a major role in the politics of coalition building over race relations, something that becomes clear when we turn to the development of affirmative action policies in the United States and in other liberal democracies (Lieberman, 2011). Affirmative action is a policy idea that can take different meanings and, through framing processes, help bring actors together by acting as a coalition magnet (Béland and Cox, 2016). Yet, as Robert Lieberman (2011) argues, to explain the politics of race and, more specifically, conflict over affirmative action, it is necessary to stress how ideas interact with political institutions to shape patterns of political mobilization over time. This remark points once again to the need for scholars to pay attention to both the logic of interpretation (i.e. ideas) and the logic of interpretation (i.e. institutions) to grasp the politics of race within APE.

Beyond these examples, how can scholars concretely study the role of ideas in APE? Considering the emphasis of APE on developmental processes, process tracing is a potentially fruitful way to explore who specific economic ideas change over time in ways that might reshape the preferences of key political and social actors. As Jacobs (2015) suggests, process tracing is a particularly appropriate and rigorous method to study the development and effects of ideas over time. Ideational process tracing is a potentially useful methodological tool for APE scholars, as long as they make sure to clearly assert how ideas are distinct analytically from other types of explanation and how they might interact with them in concrete political settings (Parsons, 2007).

Conclusion

The American Political Economy is a powerful and compelling manifesto for the analysis of APE. While an excellent start, as argued above, the framework put forward in this volume could gain from integrating a systematic analysis of both policy feedback and the role of ideas in politics. At the same time, because both policy feedback and the role of ideas are major issues within the institutionalist tradition to which APE is closely related, these two concepts can easily fit into and cohabitate within a broader framework (Béland, 2019). In the case of the analysis of the role of ideas, it is also well known within the field of CPE, which APE explicitly borrows from (e.g. Blyth, 2002; Campbell, 2004; Hall, 1993; Schmidt, 2011). More generally, this review essay stresses the need within APE to strike a balance between the logic of position and the logic of interpretation, which can be combined to solve key empirical puzzles, in the United States and elsewhere around the world (Parsons, 2007). APE is still in its infancy so it is hoped that, moving forward, the above discussion might help frame its research agenda.