Monthly Archives: January 2013

The Three Axes and Drug Prohibition

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In a conversation with Russ Roberts, Becky Pettit says

educational inequality has become so dramatic that among young black men who have dropped out of high school, a huge fraction of them, upwards of 2/3, can expect to spend at least a year in prison

She says that much of the increased incarceration in recent years is for drug offenses and nonviolent property offenses. To a libertarian, thinking along the freedom-coercion axis, it is drug prohibition itself that is offensive. Any time the government declares a “war” on anything, libertarians assume the worst. And they see drug use as a choice with which the government has no right to interfere.

Progressives have wanted to see drug users as oppressed, the victims of a bad environment and of “pushers.” Progressives see no problem in having government act to protect individuals from their bad impulses, in this case the impulse to take drugs. However, when it comes to punishment and incarceration, progressives would want to exempt users and focus on drug sellers. For progressives the idea of punishing those who profit from selling drugs has some merit (I could be uncharitable and say that for progressives the idea of punishing those who profit from anything has some merit).

To conservatives, both drug users and drug sellers are on the side of barbarism. Along the civilization-barbarism axis, the high incarceration rate among those involved in the drug trade probably looks more like a feature than a bug.

In this case, I find the libertarian freedom-coercion axis so compelling that I have difficulty seeing any merit in looking at the issue from the point of view of either of the other two axes. Perhaps I am not being sufficiently charitable. Along these lines, see the op-ed by Gary Becker and Kevin Murphy.

The Capital of the Empire

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From Deborah Nelson and Himanshu Ojha

The top 5 percent of households in Washington, D.C., made more than $500,000 on average last year, while the bottom 20 percent earned less than $9,500 – a ratio of 54 to 1.

…Two decades of record federal spending and expanding regulation have fostered a growing upper class of federal contractors, lobbyists and lawyers in the District of Columbia area. The federal government funneled $83.5 billion their way in defense and other work in 2010 – an increase of more than 300 percent since 1989, even after adjusting for inflation. Private industry poured more than $3 billion into lobbying to influence the government, nearly double what it spent a decade ago.

…The ranks of Washington-area workers with incomes above $100,000 rose to 22 percent of the workforce, up from 14 percent in 1990, adjusted for inflation, a Reuters analysis of Census data found.

…Today there are 320,000 federal jobs in the Washington area. Within the District of Columbia, 55 percent pay $100,000 or more.

Nearly 13,000 lobbyists registered with the government last year and reported $3.3 billion in fees, or about $260,000 per lobbyist. That’s 22 percent more lobbyists and 37 percent more inflation-adjusted revenue per lobbyist than in 1998, according to a Reuters analysis of data from the nonpartisan Center for Responsive Politics.

Read the entire article, which is well researched and provides food for thought.

On a loosely related note, Richard Green writes

we should pay to society our fair share of what we get from society. But the implication of this is not necessarily that everyone should sacrifice in order to put us all on a sustainable fiscal path.

The Reuters piece may tell us something about who it is that “gets from society” and hence deserves to give something back.

The Un-Malling of America

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Jeff Jordan writes,

Hundreds of malls will soon need to be repurposed or demolished. Strong malls will stay strong for a while, as retailers are willing to pay for traffic and customers from failed malls seek offline alternatives, but even they stand in the path of the shift of retail spending from offline to online.

Pointer from Tyler Cowen.

It used to be that a mall was lots of stores with a few places to eat tacked on as an afterthought. Now it’s the other way around.

It’s not just that people are buying more stuff online. They are buying less stuff (as a share of income), period. This is partly a long-term trend, as documented by economic historian Robert Fogel and picked up on by Nick Schulz and myself. It may be accentuated by information technology–think of all the stuff you don’t have to buy now because of digital technology: books, bookshelves, radios, music discs or tapes, stereo systems, calculators…

Book Recommendations from Jason Collins

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He recommends six that he read in 2012, including The Righteous Mind and Thinking Fast and Slow. One of his recommendations is a book from 2002, Paul Rubin’s Darwinian Politics, about which Collins posted a review.

Rubin’s basic position is that the political institutions of Western nations, and particularly the United States, are the best match with evolved human preferences. Humans seek freedom from dominance, with Western society maximizing that freedom. Political freedom allows citizens to form a reverse dominance hierarchy, with public pressure, wealth and constitutional frameworks limiting the ability of Western governments to exercise power. Western institutions also provide a framework that limits negative consequences of our evolved psyche, as the move away from kin based groups reduces xenophobic behaviour.

It would be interesting to stage a debate between Rubin and Michael Huemer.

The Task of Persuasion

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Bob Higgs writes,

once the libertarian has persuaded someone that government interference is wrong, at least in a certain realm, if not across the board, there is a much smaller probability of that convert’s backsliding into his former support for government’s coercive measures against innocent people. Libertarianism grounded on the moral rock will prove much stronger and longer-lasting than libertarianism grounded on the shifting sands of consequentialist arguments, which of necessity are only as compelling as today’s arguments and evidence make them. Hence, if we desire to enlarge the libertarian ranks, we are well advised to make moral arguments at least a part of our efforts. It will not hurt, of course, to show people that freedom really does work better than state control. But to confine our efforts to wonkism dooms them to transitory success, at best.

Pointer from Don Boudreaux. Let me re-state this in terms of the three-axis model. Using consequentialist arguments is an attempt to meet someone on their own axis. The “moral rock” that “will prove much stronger and longer-lasting” is to get someone to shift axes.

Claiming that government anti-poverty programs do not work is a consequentialist argument that is intended to meet the progressive along the oppressor-oppressed axis. Claiming that drug laws tend to increase violence is a consequentialist argument intended to meet the conservative along the civilization-barbarism axis. The advantage of these sorts of arguments is that they are easily comprehended by those you are trying to persuade. The disadvantage, as Higgs points out, is that this form of argument involves painful struggles, issue-by-issue and fact-by-fact. Arriving at the inevitable military analogy, Higgs writes

the anti-freedom forces with which libertarians must contend possess hundreds of times more troops and thousands of times more money for purchasing munitions.

Instead, suppose you try to convince people of the similarity between government and organized crime. You say that both provide “protection” backed by coercion. The advantage of this is that if you can get someone to shift to looking at issues along the freedom-coercion axis, that person will be less receptive across the board to arguments for state intervention based on the oppressor-oppressed axis or the civilization-barbarian axis. The disadvantage with this strategy is that your position is likely to be incomprehensible to most of those you are trying to persuade. To most people, drawing an analogy between government and organized crime seems crazy. It makes you sound like a very bitter, alienated person who resents the obligation to participate in society.

My guess–and perhaps Higgs would agree–is that the best strategy is to meet people along their preferred axis and to use consequentialist arguments until they begin to have doubts about the utility of government in dealing with oppression or barbarism. At that point, they may be ready to consider the freedom-coercion axis. However, if you go straight to the freedom-coercion axis and skip the step of meeting progressives with consequentialist arguments along the oppressor-oppressed axis or meeting conservatives with consequentialist arguments along the civilization-barbarian axis, then you risk getting nowhere.

Unpacking the Term “Probability”

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My new essay on probability concludes:

Producers and consumers live in a world of non-repeatable events…Treating probabilities as if they were objective is a conceptual error. It is analogous to the conceptual errors that treat value as objective…We will be less likely to overstate the robustness of equilibrium and the precision of economic models if we stop conflating subjective degrees of conviction with verifiable scientific concepts of probability.

I argue that one cannot assign an objective probability to a non-repeatable event, such as “will hurricane Sandy cause flooding in the New York subway system?” I could have used “Will Barack Obama win re-election?” as my illustrative example, given that Nathan Singer Silver famously assigned a very precise-sounding probability to that event.

Searchers vs. Planners

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Dana Goldstein reports,

In 2008, four Harvard and MIT graduate students studying developing-world economics decided to form their own giving circle. The research literature on anti-poverty aid was discouraging. In India, an estimated 50 to 60 cents of every government dollar spent on food or employment aid for the poor is lost due to corruption, and private philanthropy, too, is heavily skimmed as it makes its way into the hands of the poor…

So where did that leave four private donors, anxious to fight global poverty, but too savvy to trust many of the leading models for international aid? Paul Niehaus, Michael Faye, Rohit Wanchoo, and Jeremy Shapiro came up with a radically simple plan shaped by their own academic research. They would give poor families in rural Kenya $1,000 over the course of 10 months, and let them do whatever they wanted with the money.

Read the whole story. Pointer from Tyler Cowen. My title for this post refers to William Easterly’s view that bottom-up aid solutions are better than top-down.

Thoughts on Newtown and Political Authority

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Some thoughts on the school shooting.

1. I think that the three axes serve to predict reactions fairly well. Libertarians, concerned with freedom vs. coercion, are skeptical of adding to government power in an attempt to prevent school shootings. Conservatives, concerned with civilization vs. barbarianism, stress the derangement of the shooter. Progressives, looking for an oppressor, have identified the gun lobby. UPDATE: Russell Nieli, who I would categorize as conservative, blames absentee fathers.

2. If it is possible to build a car that is smart enough to drive itself, should it not be possible to build a gun that is smart enough to know when not to shoot? (a camera knows where the gun is pointing… software analyzes the image to determine whether it is a morally acceptable target… seems like the only kind of gun I would want in my house)

3. I think that the reaction to Newtown may tell us something about the psychological forces that incline people toward what Michael Huemer calls political authority. Huemer asks why we tolerate coercion from agents of government that we would not tolerate from private individuals. My hypothesis, based on Newtown, is that people are much more upset by danger that appears sporadically, anonymously, and unpredictably than by danger that is constant, identifiable, and predictable. So I think that one reason people accept government coercion is that it is relatively constant, the government’s leaders are identifiable, and their actions are fairly predictable.

(I have taken one pass through Huemer’s new book. I found it very stimulating, and I thought it was worth the high Kindle price. In the future, I will give a much longer analysis, not entirely favorable, of Huemer’s line of thought.)

What is a Charitable Contribution?

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Robert Shiller writes,

We trust one another, and not just the government, to make important decisions and to take action. Self-reliant does not mean selfish: while it is important that we manage our personal finances responsibly, we also have a deep tradition of giving to others. Many of us believe that we have obligations to others that only we can interpret, through our own consciences.

Pointer from Mark Thoma.

My question concerns how we define a charitable contribution. For example, only non-profits qualify to receive charitable contributions. I see no reason for this to be the case. I do not think that non-profit is inherently more ethical than for-profit.

Another way to define a charitable contribution would be as money donated for which you receive nothing in return. But donors get psychic benefits in return for contributions. So you could say that you are being charitable if you get nothing tangible in return. Does that mean that if I take a yoga class or go to a psychotherapist that I am making a charitable contribution?

I think that it is possible to come up with a definition of charitable contribution that works. It has something to do with the intent to provide tangible benefits to others. My contribution to a school for at-risk kids differs from my taking a yoga class in that regard.

Consider four things you can do with your income: spend it on personal consumption; invest it for the future; donate it in order to provide benefits to others; or pay it in taxes.

If we had a pure consumption tax with no charitable deduction, then the privileged activities would be investing for the future and donating to charity in the present. In that case, I would not be too inclined to give people an incentive to donate to charity in the present.

I am still trying to think through this issue.

Ideology and Views of Human Nature

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Dan Kahan writes,

Measures of ideology of the sort that I have used here have not – as far as I know; please do tell me if I’m wrong: the pleasure of learning something new will more than compensate me for the embarrassment of being shown to be ignorant — been validated as predictors of “different conceptions of human nature.” Indeed, I think the idea that ordinary members of the public have “conceptions of human nature” is extravagant—the sort of thing only someone who has never ventured outside a university campus would likely believe.

If members of the public do not have conceptions of human nature, then what makes you think they have ideology? Of course, they can answer survey questions on issues, and their answers can be highly correlated with one another in a way that looks like ideology. That is what I believe is shown by the empirical analysis Kahan provides in his post.

By the same token, my guess is that by asking the right sorts of survey questions one could uncover empirical measures of the conceptions of human nature just as interesting as the empirical measures of ideology. In fact, George Lakoff may already have done this. He talks about conservatives believing in “strict father morality” that is based on a much darker view of human nature than the “nurturant parent” morality of liberals. However, I do not remember whether any of Lakoff’s analysis is empirical rather than merely conjectural.

Suppose that we set aside the issue of whether ordinary people think like academics. Take the set of people who you believe have an ideology and have a conception of human nature. Are ideology and conceptions of human nature related? I believe so.

I think that conservatives tend to hold the most pessimistic view of human nature. That is, they think that everyone is prone to barbarism in the absence of the constraints provided by the civilizing forces of family, religion, civil society, and government.

I think that progressives hold a more optimistic view of human nature. Most people are good, but some people are bad. The bad people are oppressors, and the challenge of political life is for the good people to overcome the bad people.

I think that libertarians hold the most optimistic view of all. For example, embedded in Michael Huemer’s new book advocating anarcho-capitalism is a view of human nature that is “basically rational.” In particular, if left to themselves, most people are able to calculate that initiating violence is a bad idea. My concern is that too much of his argument depends on this concept of human nature, and this will prove to be a stumbling block in reaching conservatives and progressives with his vision.