All this accumulated law--about 300,000 pages of federal statutes and regulations--operates as a form of central planning. It bogs people down in bureaucracy. In healthcare, the labyrinthian requirements of Medicare, Medicaid, HIPAA, plus the equally dense, and often conflicting requirements of 50 states, plus the insurance company red tape, make it impossible for people to deliver care efficiently. Add to that bureaucratic nightmare the ever-present fear of being hauled into court whenever a sick person gets sicker, and you have a system that looks like it was designed for frustration and waste. (See here for principles needed to climb out of this rut.)
The inertial forces that make it hard to achieve change in Washington, in the best of circumstances, become a kind of invincible fortress when reinforced by thousands upon thousands of pages of binding law. Each of those provisions is zealously guarded by special interest groups, and changing any word of a statute requires the votes of 218 members of the House and (generally) 60 senators.
Faced with legions of special interests, Congress is trying to fix healthcare by piling new requirements on top of the old ones. But this won't address the underlying problems of efficiency, any more than it could in Detroit. To restore focus and efficiency, Congress must first clean out what's there--not to eliminate the goals of existing regulation but to put them in a coherent framework that real people can understand and internalize.
Dealing with the sclerosis of accumulated regulation, however, is not something our leaders have any experience with. Most of the historic legal reforms of the past century were written on a new slate. The Progressives at the turn of the 19th century imposed worker safety and food safety laws to fill the regulatory void of laissez-faire. Roosevelt's New Deal provided social safety nets where there were none, and job programs in agencies that didn't exist before. The civil rights movement led to laws against discrimination where there were none.
We don't have the luxury of a clean slate--healthcare, schools, and the financial sector are all mired in a bureaucratic jungle. Al Gore had the right idea with his Reinventing Government initiative, but he was trying to simplify what was there. The imperative now is much more radical, and urgent--to solve society-wide crises of affordability in healthcare, accountability in the financial markets, and disarray in schools.
Making sense of the current problems requires not just new laws--but a willingness to undo old laws in order to build coherent new structures. The litmus test is not whether some expert can draw a complicated chart showing how law requires this or that, but whether real people (including doctors, teachers, and financial regulators officials) feel liberated to focus on doing their jobs properly. The closest analog in history are recodifications that occur periodically--almost always releasing enormous improvements in productivity. In ancient Rome, the emperor Justinian is best known for taking "the vast mass of juristic writings which served only to obscure the law," and rewriting them into a coherent code. Napoleon considered his "Napoleonic Code" to be his finest achievement, and the simplified set of principles that his experts created is still the legal foundation for most European countries. America's Uniform Commercial Code, developed in the 1950s and adopted by all states, brought consistency and efficiency to a tangled web of state laws that impeded free flow of commerce.