HT: Micah Mattix’s excellent email blast, Prufrock

Two “much food for thought” insights from the article above:

Adam Smith spoke of “the man of system” who “seems to imagine that he can arrange the different members of a great society with as much ease as the hand arranges the different pieces upon a chess-board.” [Richard] Thaler and his benevolent friends are men, and some few women, of system. They hate the Chicago School, have never heard of the Austrian School, dismiss spontaneous order, and favor bossing people around—for their own good, understand. Employing the third most unbelievable sentence in English (the other two are “The check is in the mail” and “Of course I’ll respect you in the morning”), they declare cheerily, “We’re from the government and we’re here to help.”

The great essayist Lionel Trilling wrote in 1950 that the danger is that “we who are liberal and progressive know that the poor are our equals in every sense except that of being equal to us.” The same may be said of Burkeans or conservatives, too. He also wrote that “we must be aware of the dangers that lie in our most generous wishes,” because “when once we have made our fellow men the object of our enlightened interest [we] go on to make them the objects of our pity, then of our wisdom, ultimately of our coercion.”

From C.S. Lewis:

“Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber barons than under omnipotent moral busybodies. The robber baron’s cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience.

They may be more likely to go to Heaven yet at the same time likelier to make a Hell of earth. This very kindness stings with intolerable insult. To be “cured” against one’s will and cured of states which we may not regard as disease is to be put on a level of those who have not yet reached the age of reason or those who never will; to be classed with infants, imbeciles, and domestic animals.”

2 thoughts on “FOOD FOR THOUGHT!

  1. Stuart Yoder

    Hmm. I’m not sure I get where the author of the referenced article, Deirdre McCloskey, is coming from. She seems paranoid. I heard Thaler interviewed recently and my take from what I heard is that he seems resonable and espouses faily common sense ideas. I’ve not read his work, but did read some of the New York Times articles referenced in McCloskey’s article.

    From what I can tell behavior economics calls into question an assumption of classical economics that people generally behave rationally and in their best interests. It can be show that they frequently don’t.

    For example, people don’t save enough for retirement, procrastinate, and a substantial number don’t enroll in their employer’s retirement savings plans. They miss out on benefits like matching funds. A simple tweak to a company’s enrollment process like making it “opt-out” instead of “opt-in” makes a dramatic difference in savings rates. No one is coerced and they are completely free to do what they want. But, if they don’t make a decision the “default” is some small automatic savings rate.

    He calls a tweak to a process like that a “nudge” and specifically says– “All nudging should be transparent and never misleading.” It seems completely unfair to characterize that as Thaler saying “It’s bad for us to be free”. We use various systems all the times where we have choices to make. I think all he is saying is that the way those choices are framed can influence the outcomes. If obvious good things like saving for retirement can be improved while giving people complete freedom to do what they want, not sure I see why we need to be paranoid.

    Thaler doesn’t seem to be advocating new bureaucracies or new systems. He is saying small changes to things that already exist can have a positive benefit.


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