Bryan Caplan wonders why economists don’t value non-existent people’s lives.
If someone gives another person $100, almost all economists agree that the recipient is better off…If someone gives another person the gift of life, however, I’ve noticed that many economists suddenly become agnostic. $100? Definitely an improvement. Being alive? Meh. It’s hard to see the logic. Why would a minor gift of cash be a clear-cut gain, but a massive gift of human capital be a question mark?
Interesting. And, to take it one step further: what if I give someone $100, but don’t give them the gift of life? Is that person better off than someone who didn’t get the gift of life, and also didn’t get the $100? Conversely, if I don’t give someone the gift of life, and also steal $100 from them, are they worse off? What if I don’t give someone the gift of life, and also slander them, seduce their girlfriend, and poke them in the eye with a sharp stick?
Here’s a thought experiment for Bryan Caplan: I didn’t give the gift of life to a fellow named Milton J. Fishbein who owns the house Bryan Caplan currently lives in. You can look it up: I didn’t give the gift of life to any such person. The thing is, Bryan Caplan didn’t give the gift of life to Milton J. Fishbein either. But on top of not giving Milton J. Fishbein the gift of life, Bryan Caplan has the gall to actually live in the poor guy’s house. Who among us is doing more harm, here? On the other hand, neither Bryan Caplan nor I gave the gift of life to any lady named Dahlia Rostropovich Chatterjee who owns the house I live in, but at least Bryan Caplan has the decency not to go and live in her house. So I guess we’re even on that count.
I think these thought experiments may illuminate certain flaws in the initial proposition.
Filed under: Libertarianism
Back in 2003, when I’d just moved to Vietnam, one of the first stories I worked on was a piece for the Boston Globe on shrimp and catfish farming. US catfish farmers and shrimp fishermen were pushing to get anti-dumping tariffs enacted on imports of Vietnamese farmed shrimp and tra catfish, which had become a huge engine of prosperity for Vietnamese farmers over the previous few years. (Exports to the US went from about $50 million in 2000 to about $500 million in 2003, if I recall correctly.) The US Department of Commerce favored the anti-dumping tariffs because to calculate dumping, it employed a process called “zeroing”, which I won’t get into but is basically mathematical sleight-of-hand to make it look like imports are being sold below market price. And the independent expert who’d written the best explanation of why zeroing was screwy and unfair, and how it harmed the interests of poor third-world producers like the Vietnamese catfish and shrimp farmers I was writing about, was a fellow at the libertarian Cato Institute named Brink Lindsey. I called Lindsey up and he talked me through how zeroing worked, and that strongly informed the article I wound up writing. (In the years since, the Commerce Department has been forced to partially abandon zeroing in investigating dumping claims, due to international criticism.)
Years later, I came across the writing of another Cato Institute chap, Will Wilkinson, on his blog. As I recall I got into some argument with him in a comment thread at some point about his writing on happiness research and whether it meant you shouldn’t have kids. But I found his work consistently very interesting, he was clearly writing from a standpoint of genuine political and intellectual curiosity and independence, and he has an unforcedly erudite writing style that was quite different from most of what was being written in the blogosphere at the time.
I have a tendency to get into arguments with libertarians. To be more specific: I’ll get into arguments with conservatives, but I’m capable of becoming obsessed by arguments with libertarians. I also think conversations with some libertarians have forced me to think harder than perhaps any other conversations I’ve had in the past decade or so.
Anyway, Brink Lindsey and Will Wilkinson are both leaving the Cato Institute. That’s too bad for the Cato Institute, and great for me, since now Will Wilkinson is blogging at The Economist. But honestly, for all the differences I have with libertarians, I think it’d be too bad if that particular shade of libertarianism lost its connection to major libertarian institutions. This is a bit hard to articulate, but I think that if all the free-thinking unorthodox libertarians drift away to other kinds of centrist or even liberal-leaning institutions, they’ll continue to be interesting and influential writers but libertarianism may cease to be an interesting or influential philosophical current. I’m not sure why I think that would be a bad thing, since I’m not a libertarian and I think the philosophy gets much about the world quite wrong. But for some reason I think it would be a bad thing.
Andrew Sullivan writes that we shouldn’t dismiss libertarians as cranks just because they back the gold standard: “The insanity we take for granted every day – the Afghanistan war, for example – is a lot crazier than the gold standard.” Like Andrew Sullivan, I think the US should extricate itself from Afghanistan, but this is, to put it mildly, not a good illustration of the point he’s trying to make. Supporting the introduction of the gold standard in today’s global fiat-money economy is simply much crazier than supporting the continuation of a counterinsurgency and nation-building war against the Taliban that the US originally got into for very honorable reasons and with apparently good chances of success. Supporting the abrupt and unprovoked invasion of Iraq in 2003, I would grant, might have been compared in its craziness to supporting the introduction of a gold standard in a world economy that has long outgrown such metaphysical superstitions.
There are other reasons why, as Conor Friedersdorf says, we shouldn’t dismiss libertarians as cranks and nut jobs. But one of those reasons is that a lot of libertarians are much too smart to believe in snake-oil stuff like the gold standard.
Because Reihan Salam isn’t in my RSS feed, I missed the fact that he’d written responses to two things I wrote last month over at The Economist. I generally like Reihan Salam’s writing. But his first response to me mischaracterized something I’d written. His second response, I think, was kind of slippery, but I think what it comes down to is that I have a different interpretation of the term “free-riding” than he does. I believe it pretty much universally carries a negative connotation, like “freeloading”.
Salam’s first response came in answer to a few sentences I’d written about school choice. I had written that I found it surprising that Will Wilkinson, also a writer I find very interesting, picked school choice as one of the arenas in which he expected Democrats to become more sympathetic to a libertarian cause. I’m not opposed to school choice, or charter schools. But everything I’ve read indicates that there’s not a lot of strong evidence for the success of school choice programs, and that while many individual charter schools have proven successful, there’s no evidence that charter schools are on average any better than the public schools they replace; the latest broad study indicated that most were worse. This doesn’t mean that “school choice and charter schools don’t work”. What it does mean is that to say one supports school choice or charter schools is not at this point an adequate response to concerns about the quality of elementary education in America. The idea that giving parents the power to choose where their kids attend school will automatically result in widespread improvement in educational outcomes hasn’t systematically borne out in the places where it’s been tried. Here’s what I wrote:
What’s curious is that both of these initiatives seem to be several years past the point when they were the most convincing in intellectual terms, on the basis of theories and evidence. School choice was an idea that had a lot of proponents in the 1990s, but with well over a decade of large-scale pilots for various implementations, it doesn’t seem to be showing any results. And you have former top proponents like Diane Ravitch actually turning against charter schools.
Now, admittedly, I probably shouldn’t have glossed “there doesn’t seem to be evidence that school choice, on average, improves educational outcomes” as “(school choice) doesn’t seem to be showing any results”. The latter sounds more negative than I’d intended, though formally the statements are equivalent. But Salam doesn’t claim that there is strong unambiguous evidence for the success of school choice. He says, instead,
Randomized field trials in education are difficult to devise, and the number of large-scale pilots for various implementations is small, particularly when compared to the number and quality of experiments that preceded the welfare reform efforts of the mid-1990s. We do have a handful of natural experiments involving lotteries. These experiments face a number of limitations, including faulty record-keeping, a failure to properly separate treatment and control groups, and much else besides. But of the big randomized lottery experiments, we have seen nontrivial gains for African American students. We actually don’t have much data for non-black students, in large part because of ferocious resistance to further experimentation. Because these experiments have yielded nontrivial gains without an increase in resources, I’m hard-pressed to see why we shouldn’t field more experiments, ideally well-designed RFTs. The idea that this is a settled issue is … interesting.
Who said it was a settled issue? Not me. I, too, see no reason why we shouldn’t field more experiments. What I said was that since school choice hasn’t been getting such great press lately, owing in large measure to the failure, for whatever reasons, to generate strong findings of educational improvement across school systems (as opposed to at individual well-run schools), this seemed to me a surprising candidate for a new liberaltarian alliance at this time. Personally, I’m favorably disposed towards charter schools and cautiously favorable to some kinds of school choice, but I have been since the 1990s, and those ideas seem to me to command less support today than they did then, not more.
Salam’s second response addressed my criticism of his phrase “the fact that much of metropolitan Europe and East Asia ‘free-rides’ on American military power.” I didn’t, and don’t, believe that much of metropolitan Europe and East Asia “free-ride” on American military power. In fact, I wrote, I can’t think of a country that the phrase “free-riding on American military power” fits. Mr Salam responds:
Note that I put “free-riding” is scare quotes. That, of course, is a subtlety that’s easy to miss. I was suggesting that free-riding isn’t the perfect term, but it is useful. Given the way Steinglass approaches issues relating to health systems, public finances, etc., I can’t be too surprised by his reaction. But I am disappointed.
Do I believe that European and East Asian countries are spending “too little” on defense? No, I don’t. I’m not sure if that’s a meaningful concept. Military expenditures are a kind of self-insurance against an anarchic international environment. Choosing the “right” level of self-insurance is a thorny question that doesn’t have a clear answer. This is an environment with more than one imaginable equilibrium. The idea that a state can spend the right amount reflects a planner’s delusion….
The notion that there is free-riding going on doesn’t imply that it’s necessarily a bad thing: this is a core premise advanced by William Wohlforth and others who believe in “the stability of a unipolar world.” “Free-riding” in this vein is a feature, not a bug.
It seems that Salam and I agree, then: neither of us thinks European or East Asian countries are spending “too little” on defense. But really, I think this is all a bit of a dodge. Like it or not, the term “free-riding” carries strong negative connotations. The claim that countries are “free-riding” on American military expenditures is descended from cold-war-era conservative arguments that European countries were failing to pull their own weight and were spending too much on domestic social programs rather than on mutual defense against the Warsaw Pact. Now that those countries face no external threat, the concept has outlived its usefulness. Contrary to what Salam says, I don’t think one can have “free-riding” if it’s not clear that the “free-rider” is receiving anything of value. If I choose to go out and spend a million dollars on a cannon emplacement in the center of Dupont Circle, and then claim that Reihan Salam is “free-riding” on my cannon-emplacement spending, I think Reihan Salam would regard my claim as ridiculous, since he believes he derives no benefit from my cannon emplacement.
The case is more complicated in the case of America’s allies, since they clearly do derive benefits from American defense spending. But obviously every country always derives benefits from the military spending of its allies; it seems absurd to use the term “free-riding” to encompass every relationship of military alliance. Or do we mean that every country “free-rides” on the defense spending of allies only if the ally spends more on defense? Do we mean this in nominal, or percentage terms? Is Israel free-riding on American defense spending, even though Israel’s defense spending is proportionally far higher? Or is America then free-riding on Israel’s defense spending?
To me, the phrase “free-riding on American military power” suggests that a country derives clear benefits from American military power, benefits that fit into the country’s own views of its interests (as opposed to “benefits” which America regards the country as receiving, but which that country itself may have no interest in), and that the country in question is clearly failing to make an adequate contribution to its own defense. I wrote in my initial post that I didn’t think that description fit any actual countries in the world at the moment. On reflection, I believe a case could be made for Taiwan and possibly Japan; but a case could also be made against either of those countries. Taiwan spends 3% of its GDP on defense, and while that may not be enough to fend off a Chinese amphibious invasion 10 years from now, the Taiwanese public’s conception of its relationship to China has shifted greatly over the past 20 years; if Taiwanese are increasingly interested in reunification, on whatever terms those entail, then their commitment to spending whatever it takes to fend off a Chinese invasion may be ebbing for political reasons that have nothing to do with “free-riding”. As for Japan…again, what is the military threat to Japan?
Salam wants to cast me as being possessed of an absurd certitude that reductions in American military spending will not lead to increased military competition in a multipolar world. I don’t pretend to such certitude, and I think it’s entirely possible that the future will involve both less overwhelming American military power and more military competition among other states. It’s also possible that less American military power might lead to less military competition among some states.
What I criticized, though, was Salam’s certitude: specifically, his phrase “the fact that much of metropolitan Europe and East Asia ‘free-rides’ on American military power.” He shouldn’t be using the word “fact” there. If he wants to make the case that some states free-ride on American military power, he should argue that case; I’ve a feeling I’ll probably disagree. But I won’t use interjections like “Sigh.”, because, as I said, I consider Reihan Salam a pretty interesting writer.
It turns out the sports betting-saves-journalism concept is the brainchild of Mortimer Zuckerman, publisher of the Daily News. Apparently Maureen Dowd referenced the idea last week. Matt Welch of libertarian standard-bearer Reason doesn’t like the idea because, true to the libertarian credos, he thinks online gambling should be legal for everyone.
My attitude towards gambling is about the same as my attitude towards heroin: people shouldn’t be prosecuted for engaging in it recreationally, but there shouldn’t be a legal industry developing or advertising it, and the government should do whatever it can to discourage it and to offer rehab to those unfortunate enough to get addicted to it. We have developed a habit in America of funding public goods by granting monopolies to engage in public evils. We do this because we’re unwilling to pay enough taxes to support the social goods we want as a society. There are very limited cases where this is acceptable, but in general, it’s a lousy way to run a society and a ridiculously distorted way to run an economy.
Megan McArdle writes that the claim “We will control health care costs, because we have to”
is a disturbingly common argument heard when one points out that the costs of the domestic programs we have are so far impervious to cost control. Apparently, it is safe to enact a program that is going to blow a 10-gauge hole in the Federal budget, because the mere fact that we can’t currently afford to pay for it will force us to, um, do something.
Both the House and the Senate health care reform bills pay for themselves, according to the CBO. So it’s not clear what program Megan thinks will “blow a 10-gauge hole in the Federal budget.” But here’s the broader point: the US is going to have to shrink the amount the government pays for health care. This is true whether or not we create universal health insurance, because growth in Medicare and Medicaid costs will bankrupt the government otherwise over the next 2 decades. The question is who will pay for this shrinking of the amount we pay for health care. Under the current system, the following groups are paying for it: the working poor, who are gradually being priced out of the private health insurance market but don’t qualify for Medicaid. And the sick, who are slowly being kicked out of private health insurance at any point where insurers can find a legal loophole that enable them to kick them out. To be more precise, then, it’s the unlucky sick who are paying, those who get fired while sick, whose business go bankrupt while they’re sick, who filled out something wrong on a form that gets their coverage rescinded, etc.
This is an unacceptable way to pay for the rising cost of health care — by denying coverage to the working poor and the unlucky sick. Before we decide how we’re going to cut government spending on health care, we have to ensure that everyone in the country has health insurance. And the method of saving money should not be, by and large, to cut services to the poor. We in the US believe that no one should go without health insurance or basic, decent health care because they are too poor to afford it. That’s why we have Medicaid and Medicare. It is utterly irrational to continue to guarantee large overpayments to seniors on Medicare Advantage while the working poor are gradually forced to go without health insurance entirely. We need to set up a system that guarantees that everyone gets health insurance. Then we can start making cuts, once there’s a way for such cuts to be shared by everyone, on the basis of solidarity, rather than just cutting the throats of the working class.
Filed under: Libertarianism
Commenter johnbr asks whether it’s fair to say that I “have little faith in people’s abilities to think for themselves and overcome societal/structural pressures so they can ‘do the right thing’ (in this case, eat right and exercise).”
I think there are two ways to respond to this. The first is that in many habit-forming areas of life, evidence shows that individual rational benefits-maximizing decisionmaking just doesn’t influence behavior very much. These include sexual behavior, eating behavior, exercise and smoking. And that fact is reflected in common-sense wisdom (“I just couldn’t help myself”, or basically any area where people talk about having trouble controlling or disciplining themselves). Such behavior may shift as social norms shift, but it’s unlikely to shift because individuals just decide to change. Then there’s another type of behavior: transportation or other infrastructure-determined behavior, where individual choice is only of limited relevance because the decisions about what options will be available (and how easily) are made at a collective level. If I live in LA, it’s hard to decide to commute by bike. If I live in Amsterdam, it’s hard to decide to commute by car. Neither is impossible, but the different communities have decided to build different kinds of roads and housing so the choices are skewed in opposite directions.
Note that this is crazy, because LA has fabulous weather for biking 300 days out of the year, while Amsterdam has lousy weather for biking 150 days out of the year.
But the second point is that I actually don’t know really know what johnbr means by having faith in individuals’ ability to overcome societal pressure. I mean, given the current socioeconomic incentives, people are currently acting the way they’re acting, across some distribution of behaviors described on a curve. And they’re likely to go on acting pretty much the same way, on average, unless something about the socioeconomic incentives changes. From 1980 to 2004, obesity rates among adults in the US doubled, and rates among children tripled; over 30% of Americans are currently obese. Were they choosing to become obese? Given that 58% say they want to lose weight, that seems unlikely.
So this leaves you with three options. Either you think society should take actions that will change the infrastructure and the socioeconomic incentives such that individuals’ behavior will shift to, for example, make people healthier and less obese. Or you think that individuals’ behavior is by definition optimal right now, since this is what individuals are in fact doing, and the statement “Americans are fatter than they should be” is meaningless. Or, finally, you think that while the current overall situation may not be optimal, it is individuals’ own faults if they’re in situations they don’t like, and society shouldn’t do anything to make it easier for them to get out of it. I find this a passive and morally vindictive attitude towards life. But the idea that people’s “ability to think for themselves and overcome societal pressures” presents a possible solution to large-scale, population-level problems seems to me literally incomprehensible. Individual people sometimes abruptly get up off the couch and get their acts together, though even there, they almost always do so only if there are social resources to back them up. But the idea that 15% of America’s adult population could all abruptly get up off the couch and get their acts together because they all made the same individual decision to do so seems to me not to reflect any of the kinds of things that ever happen in human societies. It’s like thinking that the unemployment rate could drop from 10% to 5% if Americans would just get up off their butts and find jobs.