Nudges

So, I’m back to some of my favorite ramblings – terminology.  Only this time with a little bit of a political twist.

While I do have a political section on my blog, I have elected not to fill it with much.  Just too much divisiveness out there right now.  But I don’t consider this piece to really be the subject of irrational argument.  I’m merely puzzling over societal manipulation in one of its many forms, and how it is branded and sold.

That “form” is called “social policy.”  And you may not really realize just how pervasive this is used to shift behavior or the reasoning behind the social engineering in all cases.  But how does one brand this stuff to make it more socially acceptable?

You call it something like “Libertarian Paternalism.”  And then invent the definition for it.  To make it palatable.

For starters, here’s an example of social policy.  The government places a high tax on cigarettes and tobacco.  This has a two-fold goal.  It is hoped that by making tobacco products expensive that some people will stop smoking and get healthier.  The other side of the coin is that if they don’t stop smoking then revenue has been generated with the tax to help pay for the negative health effects created that the government ultimately has to pay to treat.  And to pay for the other societal costs as well, like lost productivity.

I have no idea what the numbers are now, but last I checked, someone died a smoking-related death in this country every ten seconds.

Well, that tax on tobacco is a very direct social policy means at addressing a problem when it’s understood that people don’t always make rational choices.  Nor do they make choices that are good for society as a whole.  Perhaps because we’ve really emphasized the individual in this country.  And, of course, in this particular case, addiction can certainly override rational choice.

And that particular tax (social policy) doesn’t require a fancy label to disguise it in any way.  Nor does a tax on gasoline.  We all know what these taxes are for.  Although people will probably scream if a tax is placed on cheeseburgers tomorrow.

Which brings us back to the label at the heart of today’s discussion, what the hell is Libertarian Paternalism?

In a sense, all social policies are a form of paternalism with the government, either local or national, or even with private interests, trying to elicit certain behavior.  Paternalism, however, runs completely counter to the idea of being libertarian, a philosophy embracing total freedom of choice, the right to live one’s life anyway one sees fit, with only one exception. That exception is that any given persons’ choice or action cannot impede on the equal right of another. “In the libertarian view, all human relationships should be voluntary; the only actions that should be forbidden by law are those that involve the initiation of force against those who have themselves used force – actions like murder, rape, robbery, kidnapping, and fraud.”

Libertarian Paternalism is the idea (or fiction, depending on how you view it) “that it is both possible and legitimate for private and public institutions to affect behavior while also respecting freedom of choice, . . .”

So, what’s an example of a social policy hiding behind the label of libertarian paternalism?  Retirement.

Yes, it seems people do not put enough money away for retirement.  And society, or at least a portion of our society, is concerned with this for a couple of reasons. First society (or government and private interest groups) wants to minimize the number of people it has to help support through government action, and secondly, businesses need people to have buying power.  It does no good for a business to produce goods, if a large sector of society (retirees) has no money to buy them.

It’s about them dollars.

Under libertarian paternalism, people are given a “nudge” to shape their behavioral economics.

So in this case, an employer would automatically enroll it’s employees in a 401K plan like a good parent would.  But in order to claim that a libertarian freedom of choice of action is still present, the employer provides an “opt out” provision.  Of course, the employee is strongly discouraged from exercising that provision, or may not be told about it.

The so-called “nudge” is supposed to push people towards choices they would make had they not been afflicted with “cognitive and volitional frailties.”  In other not so pleasant terms, this form of paternalism, as most all are, operates under the assumption that we individuals are too stupid to do what is best for us.

So what do you think?  Are we really too stupid to make rational economic decisions? Should government and private employers step in to make them for us?  Are such types of societal manipulation truly maintaining a libertarian view of independent choice?  Or should the government and private entities simply bug off and let the chips fall where they may?

In Metta

Postscript: I bring up the topic of social policy (or manipulation) at this juncture in time because of the current crisis facing us with the global pandemic.  You might find it interesting to observe what policies and actions are put in place by the government and by the private sector to influence behavior, and think about what the motives are for shaping particular changes in behavior.   There may be things going on that are much deeper than just the appearance of an interest in promoting public health.

Photo:  The US Capitol with a bit of photo fun.  I took this pic back in 1995 when I joined a protest march for safe nursing staffing.

 

15 thoughts on “Nudges”

  1. Ooh. Good post. I think people should nudge others towards making decisions that not only impact them but those around them. We should encourage 401k and savings plans, because that’s a win for everyone. We should discourage smoking (the reality is, Italy is really struggling now because of the amount of smokers) and smoking affects more than just the smoker. I also beLieve in a higher tax for alcohol, and gambling winnings should be taxed higher. These are instances where the greater good outweighs the rights of the individual

    Liked by 2 people

    1. Thanks! I agree. Of course some would call this socialism and object. With taxes, it allows people to choose, but they must pay a premium for their choice. And the government could legally tax junk food and cheeseburgers to help offset the costs associated with poor diets and “nudge” people to buy healthier food. Another means of doing this is to subsidize healthier food producers. It is interesting because in a free market economy we allow corporations to engage in manipulative advertising to sell us products that do not really benefit the individual or society as a whole. 🙂

      Liked by 1 person

      1. I suppose this question goes to the root of the labeling I mention – Libertarian Paternalism – which is really a contradiction between terms. If you allow free choices then how far should a government go in limiting those choices for the “greater good.” And who gets to decide what the “greater good” is? If our government truly placed rigid limits on goods and activities that are sold or promoted that are harmful to people, then everyone would scream that is communism. From a purely health perspective, alcohol and tobacco would have to be eliminated, but we know already that would fail. How would a government control tactile habits and inter-generational connectedness? That implies some pretty heavy social engineering – brainwashing from an early age?

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      2. I bet I can find studies to counterbalance your study, so for now, studies are kind of moot. I
        Logically people who smoke, and those around smokers have weakened lungs. I know my parents smoked and the both have emphysema, one has copd, and one has lung cancer. My grandmother who smoked had all three. So for now, I’ll agree to disagree about how corona affects (effects?) smokers. Italy does have population clusters and an older population which clearly contribute. It also depends on if you want to count cases or mortality rates. Also, everything is a biased sample at this point because corona is a sneaky virus because many people who have it will not show symptoms, or have anything more than a bad cold

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      3. People smoke all over Europe, smoking will increase transmission of Covid 19 due to hand to mouth contact and increase mortality rate amongst those infected but this does not in any way explain why Italy has been singled out.
        When it comes to government “nudging”, we, in Europe, are getting more than a nudge at the moment. Our liberties are being striped away quicker than a tarts knickers and all in the name of protection of a fragile few who have been kept alive past their best before date by an over enthusiastic health service.
        The balance has been lost between preservation of live and quality of life.
        I hope that when I become fragile, or am found to be fragile, I will be allowed to die and that such restrictions will not be applied in the name of my protection.
        THERE IS NO LIFE WITHOUT DEATH.

        Liked by 1 person

      4. No denying it, that we all will not get out of this world alive. Death awaits us all. The great equalizer. I found reading the book Homo Deus to be quite fascinating. Not in the sense of it containing a lot of original ideas, but in the sense that it coalesced a lot of ideas to extrapolate the human condition. Humans, whether religious people like it or not, are pursuing immortality. Trying to conquer deaths from starvation, from disease, from violence, from all opposing forces. Ironically, the result has been death from obesity, there is still violence, and while some diseases are held at bay, others enter the realm, a continual process of mutation. Much stronger diseases, harder to combat, more lethal. It is certainly arguable that modern medicine is a curse. That people should be allowed to die off and take their genetic frailties with them. Strengthen the gene pool. Government mandated eugenics is certainly not desirable, however. With humans, the stakes are a bit different and a “modern” society places a high value on life and protecting it. So much so it is a crime to commit suicide. Individual liberties will always be in conflict with heard regulation. Do balances get distorted. Yes. If it’s an individual choice to walk off into the wilderness and die, it should be no problem. Should people be forced to be on ventilators? I don’t think so, but should they be available to to those desiring to stay alive, as a universal right to health care? Maybe so. Does this concentrate resources for failing efforts? Maybe so. Should only the rich have these resources available? I think not. Should corporations be allowed to get insanely and obscenely wealthy by auctioning off cures to the highest bidder? I don’t see anything “fair” about that. Trying to balance – tough one. In one of my college classes many years ago, I was in a discussion about the individual versus the collective. I said that I would gladly lower my standard of living to help raise others. When I asked if anyone else in the class would do the same, my classmates all shouted a resounding NO! Selflessness versus selfishness? Where do you find the right balance?

        Liked by 1 person

      5. My thought was more that it is death that makes life possible.
        If we prevent death, we prevent life.
        The fact that life leads to death is, to me, secondary.
        I am sorry for this topic drift. I always seem to go up this blind alley ; – )
        Stephen

        Liked by 1 person

      6. I like this topic drift Stephen ! And it is still on point considering the ways governments “nudge” human actions and allocate resources. Thinking about doing a separate post on this now 🙂 I agree completely, death is a necessary thing to appreciate life. They are not separable. The physical body is going to deteriorate and die. And despite all the human efforts thrown at this, people will continue to die. I suppose we can all debate where government and community responsibility begins and ends 🙂

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