Since World War II, American government has assumed more responsibilities than can reasonably be met. Some are unattainable; others are in conflict. Government is, among other things, supposed to: control the business cycle, combat poverty, cleanse the environment, provide health care, protect the elderly, subsidize college students, aid states and localities. There are more. Most are essentially postwar commitments. As I’ve written before, government becomes almost “suicidal” by pervasively generating unrealistic expectations. The more people depend on it, the more they may be disappointed by it.

Unfortunately, political leaders find it almost impossible to confront government’s over-commitment. They find it difficult to withdraw or modify promises previously made and programs previously created — to define what really matters and discard or shrink what’s secondary, outdated or ineffective. In the budget debates, spending cuts have mostly involved across-the-board changes that exempt Congress or the White House from making explicit decisions about which programs to favor and which to reduce or dismantle. Everything, or almost everything, is preserved. This may spread the pain in ways that are politically expedient in the short run while making government less effective in the long run. It will not resuscitate trust.

We come full circle to Volcker. What he’s creating is an institute that will focus on the “nuts and bolts” of implementing policies effectively: for example, having better-trained bank examiners. Although this cannot hurt, it’s not the essence of our problem, which is being more rigorous about defining what government can and should do. Democracies must have the capacity to take actions that, though unpopular and painful in the present, are desirable for the society’s ultimate ­well-being. This defined the triumph of Volcker and Reagan in the 1980s. It’s conspicuously missing today.