Lenny Mendonca: Progressive Federalism May Be the Answer to America's Problems

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Lenny MendoncaLenny Mendonca, a former senior partner with McKinsey & Company and a professor at the Stanford Graduate School of Business, is the co-founder of New America, a self-described “think and action tank."

Through New America, he advocates for progressive federalism.

By “progressive” he doesn’t liberal, or conservative, but a commitment to progress towards the values in which most Americans believe. And by “federalism” he means using states as the laboratories of democracy, to try out solutions so the successful ones can be adopted by the whole country.

In this episode, Lenny Mendonca tells host Spencer Critchley why he thinks progressive federalism would help us meet the biggest challenges we face, including climate change, the rise of artificial intelligence, the future of work, and the health of our democracy.

Along with practical, evidence-based solutions, he says the right mindset is crucial: "Among the most important things that America needs, and the average citizen needs, is a sense of optimism about the future, and a view that the American dream is attainable in front of us, and that we have a role in helping ensure that's true."

Find a full transcription of this episode below.

Episode Links

New America

"The New Era of Progressive Federalism," paper by Lenny Mendonca and Laura Tyson

"Our Towns," book by James and Deborah Fallows

About Lenny Mendonca

Lenny Mendonca is a Senior Partner Emeritus from the Washington D.C. and San Francisco offices of McKinsey & Company, a global management consulting firm. He is a Lecturer at the Stanford Business School. He is also an advisor to several entrepreneurs.

He founded McKinsey’s U.S. state and local public sector practice. For many years Lenny led their knowledge development efforts overseeing the McKinsey Global Institute and the Firm's communications, including the McKinsey Quarterly. He served for a decade on the McKinsey Shareholder Council (its board of directors). Over the course of his career he helped dozens of government, corporate, and nonprofit clients solve their most difficult management challenges.

He is the Chair of New America and Children Now, co-Chair of California Forward, and co-founder and Chair of Fusecorps. He is the Chair Emeritus of the Bay Area Council and their Economic Institute, and was vice-chair of the Stanford GSB Advisory Council and was a trustee at the Committee for Economic Development. He serves on the boards of Fidelity Charitable, Western Governors University, Common Cause, The Educational Results Partnership, The College Futures Foundation, California Competes, The Opportunity Institute, Commonwealth Club, and The Guardian.org. He is a member of the Council on Foreign Relations, the Board of Trustees for Junior Statesmen of America and the Advisory Boards of QB3, the Haas Center at Stanford, Third Sector Capital and the Public Policy Institute of California.

He received his MBA and certificate in public management from the Stanford Graduate School of Business. He holds an AB, magna cum laude, in economics from Harvard College.

He lives on the Half Moon Bay coast with his wife, Christine. They raised their two daughters, Allie and Rebecca, there and are the founders and owners of the Half Moon Bay Brewing Company, The Inn at Mavericks and the Pacific Standard Taproom.

— From www.newamerica.org/our-people/lenny-t-mendonca

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Transcript

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[00:00:00] Spencer: Dastardly Cleverness in the Service of Good is produced by Boots Road Group. Boots Road Group creates impact: branding campaigns, content and more, including websites that are powerful, beautiful, and simple to use. More on Boots Road Group at bootsroad.com.

Welcome to Dastardly Cleverness in the Service of Good, the podcast for people who make progress. I'm Spencer Critchley.

In many ways, our current era is a lot like the Gilded Age. New technologies have made a few people extremely rich while disrupting the lives of millions of others. My guest this time thinks the solution also has roots in the past: progressive federalism. Lenny Mendonca, the chair of New America, this time on Dastardly Cleverness in the Service of Good.

Lenny Mendonca is a senior partner emeritus with McKinsey & Company, the global management consulting firm. During a long career with McKinsey, he advised dozens of government, corporate and nonprofit clients. He also has or has had senior roles with a long list of other institutions, including the Council on Foreign Relations, California Forward, Children Now and the Stanford Graduate School of Business, where he also teaches.

Along the way, he's somehow found time to create a brewery, tap room and an inn in Half Moon Bay, California, where he lives. And Lenny Mendonca is the co-founder of New America, a self described think and action tank. Through New America, Lenny Mendonca advocates for progressive federalism. He says by the word progressive, he doesn't mean liberal or conservative, but a commitment to progress towards the values in which most Americans believe. And by federalism, he means using states as laboratories of democracy, to try out solutions so the successful ones can be adopted by the whole country.

You can find notes and links for our fascinating conversation at dastardlycleverness.com. Here now is my interview with Lenny Mendonca.

Lenny, thanks so much for joining me.

[00:02:02] Lenny: Happy to Spencer, thank you.

[00:02:04] Spencer: Could you describe for me the situation you think we find ourselves in?

[00:02:07] Lenny: So in the United States in the era that were in now feels actually a lot like what had happened at the end of the nineteenth beginning of the twentieth century that we're having despite the uncertainty day today, a robust stock market growing well, but a lot of that money going to the people at the top. We've got a dramatic change in technology that is changing how people live. But it's really making people anxious about their jobs and the future of work. That city's air, thriving for the wealthy and ambitious but rural America, is feeling a little bit left behind. There's hostility towards immigrants. There's dissolution with government. Citizens are feeling like the wealth are hijacking democracy. And it feels very much like what we were in in the early nineteen hundreds, a challenging time, but one that has a huge opportunity for reform.

[00:03:07] Spencer: So really you're kind of describing the Gilded Age and what came after, right, with the robber barons and the incredible wealth that was enabled by technologies like the railroads and mechanized factories. And yet now it's it's more software driven, the age we're in now.

[00:03:28] Lenny: yes, so what happened was we were transitioning to a new industrial age at that time, and our institutions, everything from government to our social institutions, lagged behind that. And now, as we're transitioning to information and and artificial intelligence and robotics and everything else, we've got the same challenge of a different era industrial era. But our institutions are not keeping up with it, and that's the stress that we're feeling right now.

[00:03:56] Spencer: Can you describe for me some of the main areas where you think we're in trouble now? In the present, for example, I've seen that you've written about climate change. What's your What's your view on climate change?

[00:04:06] Lenny: Laura Tyson, who's the former head of the Council of Economic Advisors of the United States and now the dean at the hospital, broken. And I have been writing a fair amount about the opportunity for what we call progressive federalism, to attack a number of the issues that we're facing today. We most recently wrote about the challenge of climate change, and obviously we've got a president who is denying that it's happening let alone doing something about it and making the United States and out wire in the global environment in terms of response. But what is happening is that cities and states and businesses and investors are not waiting for the federal government. They're saying that the time is now to act. So we're finding a riel resurgence of interest, of new ways to accomplish change, even if the federal government isn't leading that. And climate change is a good example of that, where you're seeing places like California taking a major step in terms of establishing a set of policies to directly address climate change you're seeing. At governors in other states that represents forty percent of the US population and forty six percent of the GDP have signed on to the Paris accords. You're saying businesses step in twenty economic sectors in upwards of one point three trillion and revenue have confirmed their commitment to combating climate change. And investors are demanding disclosure around business activity on climate change. So in some levels, even while the federal government is lagging, we're seeing other step up, and we think that's a good example of progressive federalism at work.

[00:05:57] Spencer: Now you talk a lot about progressive federalism, and you think it's a big solution. Can you describe how you define progressive federalism?

[00:06:05] Lenny: We to find progressive federalism, and we use the term explicitly. It's not a term that is right or left, Democrat or Republican. It means progressive as in progress towards things that are shared American values, like liberty, equality, democracy, prosperity and justice. In fact, one of the original American progressives, progressive leaders in the last era, President Teddy Roosevelt, was a Republican, of course, and later helped create US progressive policy, declared that he always believed that wise progressivism and wise conservatism go hand in hand. So really, what we're talking about is trying to use the power of the 10th Amendment to the U. S. Constitution, which says that powers not delegated by the Constitution to the United States are reserved for the states or to the people. So using the laboratories of democracy of states and cities, trying to make progress on that.

[00:07:08] Spencer: And that in itself is kind of a conservative viewpoint, isn't it? In classical terms.

[00:07:13] Lenny: Well, you know, sometimes it is both classical federalism, which sometimes historically has been used as a synonym for state's rights and being anti progress. But we're suggesting is there's no reason that federalism can't be pro progress. That's something that's turning the United States into a new example of democratic prosperity by leveraging that progressive constitutional right.

[00:07:41] Spencer: And the people you described responding to climate change, at various levels of government and also in the private sector, of course, go across the full ideological spectrum, and it makes me think that part of the problem with an issue like climate change is that for some reason, information has become politicized. So, you know, we famously can't agree on what reality is anymore and climate change strikes. Many of us, I think, as non ideological. It's a question of risk management. And while we may never have one hundred percent certainty about anything, the risk profile of climate change is the kind of thing that motivates Seo's toe act just out of sheer wanting to protect the interests of their corporation and shareholders. Right. So do you see that as a challenge also, as part of this basket of challenges, the politicization of information?

[00:08:32] Lenny: Oh, it's definitely a challenge. And particularly if there's an assault on facts and logic and data in this case, the evidence is extremely clear. It's scientific consensus of a clarity about both the direction of climate change, its impact and the ability to do something about it. And it's something that that the vast majority of citizens, not just in the United States but around the world believe is happening, and we need to do something about it. And if you're a business person or an investor with a long term horizon, and you see this most notably in institutional investors, pension funds, those holders of the market as a whole really understand that this is something that is a major risk and needs to be addressed. So while the federal government and particularly this administration, is continuing to deny that evidence and not moving on it, investors aren't waiting. So you know, if you're a reinsurer holding large portions of risk that has long lives associated with it, this is an important issue for you, and you're forcing people to deal with it. So I think the evidence is clear and the data is clear. It's a question about political will, and in the absence of federal government, and particularly those who are denying facts at this administration, you're seeing movement and other in other sectors that are doing the best they can until the federal government gets its act together.

[00:10:09] Spencer: Another sector we didn't mention would be the U. S military, which is folded climate planning into its strategic threat planning. I wanted to move on also to another major issue, which is jobs in the economy, something I see that you and Laura Tyson have written about and you have, ah, view on jobs that's focused more on quality rather than quantity. Right? You say the problem may not be so much quantity, but the quality of jobs. Can you tell me more about that?

[00:10:36] Lenny: Sure. So we have written and followed others research and done some of our own on the impact of these technologies on work and employment. And just like every other ear of industrial transformation, the real challenges adapting to those changes and the nature of work, not necessarily the number of jobs I'm maur concerned about the quality of what those jobs are in ensuring that people can earn a good living on those jobs and that are not subject to a safety net. That's driven by assumptions, historical assumptions about lifetime employment in one job than I am about will there be jobs? And so what we talk a lot about is the importance and need to think about how do we help the next generation of your workforce adapt to what's going to be a continually and probably escalating pace of change in the work force? Which only means that you need to think about opportunities for lifelong learning and education. Not assuming that what happens is that you learned by the in your teens and twenties and then you earn for the rest of your life. I think more likely we're going to have to have an environment where that's much more continuous process of learning and learning at the same time throughout your entire life, on the changes in technology that are underway, our point to impact a large portion of the economy. It mostly means that people's jobs are going to change, not necessarily that large swaths of jobs are going to be eliminated. In fact, the every time the Bureau of Labor Statistics, federal government projects, what the job growth the fastest growing jobs are going to be. And they looked back ten years. What was the jobs that grew the most? It was jobs that weren't even around ten years ago. So I'm sure that's going to happen again.

[00:12:38] Spencer: And it's very difficult for us to predict the future because we tend to think in linear trends. But the future evolves in an extremely complex way. That's probably beyond the ability of our minds to conceive.

[00:12:50] Lenny: No, that's right. And we, you know, we we haven't even explored yet What's going to happen to changes in technologies that will influence how long people live on what their lives were like as they're living and to their babies and nineties and even entering the second century of life. And that's gonna require whole portion of people to be supporting, uh, care. It's goingto have a whole different stage of life where people have opportunities to participate in a different kind of engagement in the workforce in their leisure time, if we have the resources to enable that. And so it's just, you know, an era that it will be exciting and challenging and important that all of our policies and practices adapt to a changing nature of work, as they have many times in the past.

[00:13:43] Spencer: Now, because of your views about the way jobs continue to grow, often in unpredictable ways, you're a skeptic of universal basic income. Is that right?

[00:13:55] Lenny: I am. I'm I'm skeptical on it about it for both practical reasons about how expensive it would be, how oriented it is towards a fatalistic assumption about the opportunity tow have meaningful work, meaningful lives and the purpose of driven life. And I most skeptical about it, because what it does is, it puts off the harder questions around. How do we ensure that work is valued and that those who are working our compensated for that and just assumes that there's going to be a dramatic concentration of wealth. And the only way to deal with that is to give people money from some yet to be determined source so that they don't revolt. I just think that's a very cynical, on unhelpful view of that. The economy, and what we really need to do is to ensure that we are enabling people to participate in the economy of the future and ensuring that rewards for that work or shared broadly might much rather have a system where people are excited and feel purpose and meaning in their life, as opposed to film. Like the only way that they could get buys on the generosity of a small portion of the economy and people who actually have wealth. I just think that's a shortsighted view, and I'd much rather pay attention to the near term

[00:15:22] Spencer: under our system in the US, if people don't have a good job, they may very well not health, have healthcare coverage. And you think that there's a progressive federalist solution to the health care challenges. Well, we thought under the previous administration that we were taking steps towards the universal health care that is found in other Western countries. But now, of course, the Trump Administration is trying to roll that back. What's the progressive federalist solution for health care?

[00:15:51] Lenny: So it is already happening on the Affordable Care Act, despite the Trump Administration's efforts to peel it back has been widely accepted by the American citizens. It is a move to having Mohr of your safety net independent of your employment, solely yours employment. We've also seen when voters have a chance to vote on what do they think about it? They actually are voting to expand so that they have been a large number of ballot measures in the last, both this twenty eighteen election and in the twenty sixteen election, where the opportunity to expand Medicaid was on the ballot and if one almost everywhere it was in place. So and that includes in their thirty six states have now agreed to expand Medicaid coverage, including in the last ballot in red states like Utah in Nebraska. And there are likely to be a number of other states that will have the opportunity to choose citizens while the opportunity to choose where they want to expand Medicaid like a allowed, and I suspect you're going to see even more red states like Florida, Missouri, Oklahoma, maybe South Dakota, Mississippi, Wyoming haven't opportunity to vote on that in twenty twenty, and it's pretty clear what happens when citizens have a voice they want. They want that health care expenses.

[00:17:21] Spencer: Dastardly cleverness in the Service of Good is produced by Boots Road Group, a marketing firm for purpose driven organizations. Boots Road Group creates branding campaigns, content and Mohr, including websites that air powerful, beautiful and simple to use more at boots road dot com. This is been quite a surprise, I think, for many people, which is how non ideological the average American actually is. I think very often the political parties tend to assume that everybody thinks the way they do, and they've if they're conservative. They thought through conservatism, they've, you know, read their high ek et cetera. And if there liberal, they've thought through their liberal ideology, and they've got a coherent liberal worldview. But one way I look at it sometimes is in terms of three eyes. There is, you know, what comes first is interests and then identity like people's cultural identity and and then maybe ideology. I like your perspective on that, especially because, you know, we've just been talking about climate change and how, for some reason, climate science is now political. But I think what you're saying about health care and the results of people voting at the local level in state level on health care indicates that a lot of people are not particularly ideological.

[00:18:33] Lenny: We have a political system that is been engineered by the participants in that system to serve the extremes. So whether it's Jerry Mandir ing or a hyperpartisan primary process or the large influence of money in politics, or whether it's the actual electoral on governing reforms, we have a system that, despite many political scientists, view that in twenty years ago the problem was parties were too alike. We now have parties that represent the extremes, and so what we really need to do is reform that political process to ensure that the all citizens have a voice, that we don't have a process that is all oriented around trying to turn out your base and discourage the others from voting. That just really creates unhealthy stalemate and Ping pong back and forth between extremes. I'm not pessimistic about the progress on that front, just like I said in terms of Medicaid expansion, when voters had a choice on what they wanted to vote on and how they felt about democracy. There were two dozen ballot measures on the ballot in November of twenty eighteen that looked at in seventeen states that dealt with things from redistricting, money and politics, voting rights, ethics and democracy. One big and almost all of those voters made their choice that they want a democracy that works. They don't just want it to be ideologically extreme and grid locked.

[00:20:12] Spencer: You know, one of the objections that comes up when we do talk about what's happening with the polarization and I agree with you, I think we've become hyper polarized. I sometimes think that our political system has become an employment program for political consultants, you know, in whose interest is to fuel. And I've been a political consultant to it's in their interest economically to fuel the polarization, cause it just generates more work. Ah, little bit conspiracy, thinking there that I'm not entirely serious about. But it sometimes looks that way. Um, But also when we talk like this, there's a risk of both sides. Ism right that, you know we say that well, the Democrats are extreme in the Republicans or extreme, and in my view they're They're our bilateral problems with polarization. But I believe we also have a Republican party that's going through some unique, asymmetrical issues in terms of just, you know, commitment to facts and logic. For example, would you agree with that?

[00:21:14] Lenny: I do agree with that, and it's most pronounced. Um, we see it very clearly in California, where the no party preference set of voters air now larger voting bloc than the Republican voters in the state in terms of registration and the Republican Party is going to have to go through its own self examination of what it is that they would like to stand for. I do believe it's important to have two at least two very strong functioning parties that represent broad swaths of the population. Unfortunately, and it's been most extreme in California. The Republican Party has gone too far, too. The kind of representation that's a very small and increasingly irrelevant a portion of the population. They're going to need to renew themselves. There are many conservative, principled conservatives and the base of the Republican Party who are aghast at the trump takeover of the the party and are really interested in trying to reinvent what that party looks like. I do think that's very important for not just the party but for a functioning democracy in the United States that we have Ah, a party that is really it hears to a set of principles that are that are fact based that are about trying to truly represent important portion of the population and not subject to the kind of fact free, um, dogma that this president is pursuing.

[00:22:44] Spencer: And I assume when you say irrelevant about that hard core base, you mean irrelevant because of the extremism and disregard for facts.

[00:22:52] Lenny: Yes, men. You have, Uh eh. Extremely one sided election, particularly in in California. That was driven by a repudiation of that from a very large portion of the population. And some serious re examination is going to have to go on if the Republican Party here is going to be relevant.

[00:23:16] Spencer: I agree with you that we need a functioning Republican party. I'm a Democrat But I'm one of those Democrats who believes if we didn't have ah, legitimate Conservative party, we need to create one because the system doesn't work without that debate going on. And and I think it's crucial that you know we should We should root for the Republican Party to heal itself and become more functional. It's on. This leads me to the state of democracy. We've kind of gotten into it a little bit here, but if we're going to solve the problems you see is part of progressive federalism than presumably, as you suggest that implies we need to have ah, a functioning democracy, a healthier democracy. Do you see Progressive Federalist Solutions There?

[00:24:01] Lenny: I do. And there there are actively underway. The They're particularly driven around four areas that we're seeing progress on. One is that we're seeing really pushed back against jury Mandarin. It's actually pronounced gerrymandering, but

[00:24:19] Spencer: no. Interesting. That's right. I forgot that they named after Mr Gary.

[00:24:23] Lenny: Yes, exactly. But popular vernacular gerrymandering. And so every place that's been on the ballot in the last while here and citizens have said we don't want district's drawn by incumbents and Supreme Court still away and on a couple of those cases that are in front of them, one in a Republican, Jerry Mandarin and one in a Democratic germ and Goring. But there's when citizens have a voice. They just think this that's ridiculous. So that's one thing that's got to change. The second thing that has to change and is changing is that we need toe reform the primary process. As we talked about before California's done that with an open primary, Main did it with rank choice voting. I think we'll see a lot more moves towards primary process reform in different ways across the country. The third one is thinking about the role of money in politics. Clearly, with citizens United, another court cases is going to be hard to do that with limiting money unnecessarily. But I think there will be much more moves, too. Transparency in government, that voters have a right to know where the money's coming from down the source level and not have it laundered through several intermediaries. And then, even in some places, we're seeing public financing that goes along with that. Thirteen states already offer public financing in many cities, and many of them are expanding what they're doing. And then finally we do have tto reform things about the legislative process, things that about how government actually works when it's in place. So we just should not be having the sets of things that are going on in Wisconsin now, following the North Carolina playbook of a lame duck legislature, deciding to overturn the will of the voters and prohibit the next leadership from being able to govern because they didn't like the voters results. That's just not the way democracy's supposed to work.

[00:26:19] Spencer: And some of that I think people can get away with because so many citizens have become disconnected from the political process in some cases because of cynicism over the way they see it working in other cases. Because I think that they may be just distracted by other things like entertainment, sports are getting on with their lives. Do you see greater civic engagement as part of this from there, from not just the local level but the grassroots level up?

[00:26:43] Lenny: I think it's crucial the this midterm had the largest turnout in a non presidential election in a very long time, and that's very encouraging. We just need to make sure that it's not just driven by anger and frustration with the existing leadership, but it's really encouragement in an enthusiasm about voting. And we've seen that both the next generation is starting to turn out portions of the population that has historically voted less. They're starting to turn out. The Hispanic population, in particular, has turned out in ways that is encouraging. They're many elections, including some of them that were just recently called that were decided by a very small number of votes. In my hometown, the school board election was won by three votes. We have. And then we need a re commitment to ensure that civics and that understanding and education about what government is and how it works are put back into our schools in a much more fundamental way. If we were really encouraging people to understand how it works but not understand by reading about history but by doing it by participating in it, including which happens in some states that when you get your driver's license at sixteen, you're automatically pure registered to vote when you're eighteen. That really does help If people start their civic participation process when they're still living at home in high school. They're much, much more likely to be engaged systems throughout their lives. So I do think we need, as you said, a major effort in citizen participation, and that includes civic education and engagement of our younger people.

[00:28:26] Spencer: Leadership matters not just in our politics and government, but it matters, of course, in corporations and non profit organizations, the public and volunteer sectors. And you've got a background in management consulting that's very deep. What are your thoughts about the leadership challenges that we face a cross society, not just in politics. As I say that across these other sectors, you

[00:28:56] Lenny: know, I completely agree with you that leadership is essential ingredient and any institution to ensure that it functions well and as a consultant, work for thirty years doing that, and advised leaders in the public sector, in the private sector and in the social and philanthropic sector. And it's really challenging toe Lida, complex institution and some of the best leaders that I ever advise and continue to work with our actually in the public sector. There's this kind of common narrative that if government was on ly run like business, and we had business leaders running government. Everything would be great. They're certain management principles and understanding technology and innovation that would be helpful to be more apparent in utilized in the public sector. But the leadership challenge in the public sector is much more complex. You're having to deal with a much more challenging array of stakeholders, really having to think about tryingto maximize public good as opposed to shareholder value. That's a much more complex endeavor. I'm one of the most interesting and encouraging things that I am seeing around leadership is that there are people who are are engaging in public service who have an experience up that cuts across the public and social sector. I really think in the future that we're going to need Muchmore cross sectoral collaboration where the public and private and philanthropic and social sectors and academia and health care are working together to solve problems as opposed to in silos. And increasingly, I think we will see the leadership, development and educational systems aligned around that where what we're doing, as happens in some other countries in the world more than the United States, that those aren't completely distinct educational career paths that only intersect very late in life. I think we need more and more leaders who are spending some time in the private sector than deciding to spend some time working in the social sector, sending some time in the public sector and vice versa. And I don't mean a revolving door. I mean, legitimate leadership experience is that, well, make your your better private sector leader if you understand how government works and you'll be a better social sector leader if you spent time in the private sector understanding, management principles and application of technology. So I think that's going to be a very interesting thing. Toe watch in the next while here. And by the way, if you talk to next generation of students who are in college or entering the workforce, is I do teach A of course it at Stanford. That's the life they want to lead. They want to lead a life of purpose. They want to leave a well rewarded life, but they're much more interested in meaning and values and purpose than they are in narrowly confining themselves to one sector or another.

[00:31:59] Spencer: Yeah, and we're seeing the rise of the purpose driven corporation going beyond the traditional kind of while we donate to nonprofits and, you know, we we send out our staff to clean up a park once a year or something, but instead corporations recognizing they need twofold purpose into their reason for being girl. So in many cases they can't attract younger employees, right?

[00:32:21] Lenny: No, it's way. When I was Kinsey, we did organisational health assessments of institutions, and what you would often find is that in the private sector you'd have talent in your company. That was very clear on the purpose of the organization, what priorities were, how they made money and those sorts of things. But they really didn't feel meaning in a sense of of purpose in the mission of the organization, and the public sector was often the opposite. People felt very attracted to the mission and purpose of the organization, the public purpose in the values. But they weren't really clear on how the hell performance was measured or what their role in accomplishing that mission wass. The interesting thing about those two differences is if you could bring the best of both. It's amazing. So if you have a purpose driven organization that has a real performance orientation, and people are very clear on how they contribute to it. That's the best of all worlds. You get high performance and high mission, and people are excited about showing up for work every day.

[00:33:29] Spencer: That's so interesting. And I've seen that in my own work experience the last well with my firm. We started out wanting only to serve and still are rented this way, way, way only take clients who are committed to making the world better in some way. And we thought going in that that would mean nonprofits, government agencies and relatively rare corporate clients who were socially responsible. But what we're finding now is the purpose driven private sector is growing so much that those distinctions are becoming less and less relevant. I also think it's really interesting when you talk about the complexity of the challenges on the public and social sector. I'm I'm also one of those people who says, You know, we can learn some things about efficiency and accountability and effectiveness from the business sector, but I think you're you're so right that people often don't realize the extent to which they're succeeding in a domain because they have shrunk the problem space so much. This is a occupational hazard for engineers. For example, I would say Who think that? Well, look at how great we are at writing software. You know, we're or building skyscrapers. I mean, it's amazing what we can do with the tools we have, but they don't realize that as impressive as that is, you know, a CPU isn't going to get up one day and decide it's a mattress. Yeah, thin the social sector. You know you're dealing with human beings that in incredibly complex configurations and environmental conditions

[00:34:57] Lenny: No. I mean, if you take three of the biggest challenges facing R country today and particularly in the state that we live in climate change, the healthcare costs and quality challenge and the affordability of housing and are living, those are all topics that on ly get solved. When you understand that work across sectors, there's no way the government are going to solve those problems alone, and the private sector's got engaged in them in a way that is part of the solution. Space in in each of those sectors is extremely important role that philanthropy in the social sector plays so you know, to really understand all of those. It's not a narrow engineering problem. Its systems problem and requires people in leaders who operate across the sectors

[00:35:48] Spencer: and systems problems air. It's incredibly, they're the most challenging ones. And and are we tend to be, I think, the most limited in our natural capacities for addressing systems problems because it's hard to even conceive of a systems problem. And we kind of want to function as individuals or with him within silos, whether those silos, their tribal or organizational or whatever, do think that we can come up with a way of updating our the design of our economy in our society so that this kind of collaboration can happen. It's it's it's It's a notoriously difficult problem, especially in politics.

[00:36:27] Lenny: No, it is, and I think it is in some ways happening at the community level. And so in some ways, the way you have to deal with large, complex systems is to break them down into things that you can solve and meaningful problems that you can make progress on. Jim and depth owls have written a fantastic book and called our town's

[00:36:51] Spencer: right, James Fallows, from No House, People From the Atlantic?

[00:36:55] Lenny: Exactly. And they have, ah, whole Siri's of experiences. When you actually engage in rial communities who are really trying to solve the issues that they share in common, you see the kind of cross sectoral collaboration, and in fact it's mostly a political in the sense that it's not partisan. And that's where you see the progress happening. And I think what we're going to need to do is we are detect a little bit of how we solve problems and not delegate them up and assume that the answer is big, massive federal programs. But parse them down to communities. Let the experimentation and natural elements of the U. S is federal system. Attack them. And then, when you see what's working, scale those in a line federal policy around us. And so I think that's part of how you deal with systems. Complexity is alter the nature of where the problems being solved.

[00:37:51] Spencer: Fascinating, so don't be stymied by the scale and complexity of the system. But once again try to get local. Is it? It's another progressive federalist approach. I guess we've covered a wide range of topics here. Is there one thing that we haven't got to that you'd really like to touch on?

[00:38:07] Lenny: You know, I just think one other element that's important in all of what we're talking about is is mindset and attitude. I think among the most important things that America needs and the average citizen needs is a sense of optimism about the future and a view that the American dream or fear in California, the California dream is attainable in front of us and that we have a role in helping ensure that's true. They a sense of fatalism, a sense of pessimism of you that there's no opportunity and that it's someone else's fault is really dangerous not just for the economy but for democracy and without being Pollyannish about it. I think it is really important that our leaders and all of us engage in a way where we have a sense of purpose, a sense of progress, a sense that when we work together, we can help make democracy work. We can make the American dream work, and we could be a model again for optimism in the world. And unfortunately, too much today is you wake up every morning and you feel like you're reacting to the bad things that happened the night before Or what is the news cycle in? That's not what we need to be talking about, the kind of engaged and figure out how we make this a better place.

[00:39:29] Spencer: So let me ask you yourself, Are you confident we're going to get this right?

[00:39:33] Lenny: You know, I am confident that we are going to make mistakes, that we're going to try some things that don't work. But I am also confident that if you unleash the creativity and innovative spirit of the American people, we will, We will get there. We've been through these kinds of challenges in the past, and what has happened is that Americans who are that optimistic breed that in many ways were the pioneers who first came to this country. Step up again and say, We're going to make this work and we're going to show you how it's done. And so I think what we really need to do is unleashed that energy and move Torre towards a positive, progressive view of the future of this country, and I am highly confident we can get there if we do that.

[00:40:19] Spencer: Lenny, Thank you so much again for speaking with me today. It's just been fascinating.

[00:40:24] Lenny: My pleasure. Thanks for reaching out.

[00:40:28] Spencer: You've been listening to Dastardly Cleverness in the Service of Good. We just heard my interview with Lenny Mendonca, the founder of New America, a think and action tank. If you liked it, please give it a rating on iTunes. The podcast Home is at dastardlycleverness.com. On Twitter were @dastardlyclever and on Facebook, where dastardlycleverness. The podcast is produced by Boots Road Group. I'm Spencer Critchley. Thanks for listening.