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January 28, 2006
Rationally Ignorant

I read these Arnold Kling posts 1,2,3 about Bryan Caplan's work and forthcoming book.

So here's my offer: If I use the title you suggest, I'll take you to lunch at Morton's (Tyson's Corner or Reston, your pick).
I meant to develop and apply the ideas to things that have been said here - more politics is stupid ammunition - but didn't get it done. Marcelino Fuentes at Biopolitical posted about it and said some things well.
To attract votes, politicians promise policies that are popular instead of optimal. So democracy delivers bad policies. The alternative is not dictatorship, which usually works much worse, but individual decision-making and responsibility. Educating voters or cleaning up the campaign finance mess will not work.

In classical public choice theory voters are rationally ignorant because they lack incentives to inform themselves. Learning about policy is costly, the probability that anyone's vote will affect the outcome of elections is negligible, and the costs of choosing the wrong candidates are borne by everyone, not just the voter. According to Caplan "voter ignorance is a product of natural human selfishness, not a transient cultural aberration."

If voters' mistakes were random in direction the problem would disappear because in large electorates mistakes would cancel out. But on many matters of policy voters make systematic errors. . .

And it is not only that voters are ignorant. Caplan's main original contribution to public choice theory is that voters are irrational. . .

Just as ignorance is more profitable to voters than information, irrationality is more profitable than rationality. It feels good, it is inconsequential because your vote is not decisive, and everyone, not only the voter, shares the costs. For the individual voter the costs of irrational ideology are negligible compared to the benefits.

My emphasis. Politics is stupid because voters are rationally ignorant of the issues and the costs of irrational ideology are negligible. As Marcelino notes, contra Caplan, "The alternative is not dictatorship, which usually works much worse, but individual decision-making and responsibility."

Yet there is a need for joint decision making and shared responsibility for some things. The likelihood of good decisions by any group increases as the issue becomes more personally relevant, so that it becomes less rational to be ignorant about it, and as the costs of the decision are more directly charged to the individual members of the group. This doesn't necessarily mean that "democracy delivers bad policies" so long as the scope is local. It is when political methods are used to formulate national policies that things become a crap shoot, but there are very, very few issues that must be dealt with at that level. Making a federal case out of something very nearly guarantees that poor policies will result. The chances of good policy results are less than random choice. We'd be better off flipping coins to make decisions at the federal level.

There's an example of the problem in the news now. James Hansen, a NASA scientist, has been a global warming scold since the late seventies. He is claiming that after some provocative behavior in 2004 - denouncing Bush and stumping for Kerry - and a recent talk advocating more vigorous emissions controls on autos, that NASA is trying to silence him. Roger Pielke, Jr. thinks that this is "unbelievable clumsiness" by the Bush administration. Pielke lists a number of reasons why this is bad, the most salient of which are that Hansen is making political statements not policy statements, which is his right, and that this is self destructive unless it is opposed.

From a crass political standpoint, when scientists of the stature of Jim Hansen make overtly political statements absent any substantive or meaningful discussion of policy, they make themselves look bad. Had the Administration given Jim Hansen enough rope, he may very well have undercut his own authority by looking like just another scientist trying to couch his political views in science.
I don't know about that. Politics is stupid so I have some trouble thinking politically, but the Bush team has a pretty good record of assisting opponents with their desire to hang themselves, not just letting them have enough rope but also daring them to do it. Hansen, according to his deputy Larry D. Travis, "feels very strongly that this is an obligation we have as federal scientists, to inform the public". And yet the public will remain rationally ignorant of the issues and cling to irrational ideologies which comfort them. There's no telling how this will look after a few twirls of the cognitive kaleidoscope. Did the Bush team bait him into making career limiting remarks to the press - who wants a loose cannon rolling around below decks? - or have they, as Pielke claims, shown "unbelievable clumsiness"? And does it even matter except to a comparatively small number of politics junkies?

When we consider the political blunders of climate policies such as those of Canada - who scathingly denounced the US for lack of a correct climate policy while their own emissions rose by a quarter - or most European nations, some of which are twice as bad as Canada, it seems that politics and national policies are irrelevant. But if we try to move the decision down to a more local level, where rational ignorance can be overcome and the costs of irrational ideology are borne by the locality alone, we find no help. The Inuit complain about warming and file law suits against the US, but they don't live in snow houses, dress in animal furs and haul sleds and harpoons to the hunt; they live in houses heated by fossil fuels, wear modern clothing, and ride around in pick-up trucks and snow mobiles to hunt with guns.

Political fortunes may be made or lost, real material fortunes may be won as well since this has become big business, the news and entertainment industry is over joyed to have some drama to enliven their sordid offerings, but the climate is unaffected. I once likened politics to a fist fight between rival gangs of hooligans in the stands at a sporting event. It has little effect on the contest - never a good effect - and for all its noise and drama is boring and irrelevant, no where near as interesting as the real contest on the field.

The real contest is the effort to develop and deploy energy systems that are more appropriate for our times, something like the transition from beasts of burden to internal combustion engines last century, or the transition from wood fired steam engines to coal and then diesel electric - moving up the hydrogen ladder to fuels with less carbon and more energy. This effort can't be accelerated by political insistence. That you have a right to insist doesn't help at all. All politics can do is hinder the process by squandering resources on pious feel-good policies.

There are claims that the public is increasingly indifferent to the histrionics of politicians, that they are increasingly turned off. If so this is a positive trend. Whatever the question, politics is not the answer. It's the "Freakonomics" insight.

Taking as a model the research techniques that Steven D. Levitt displays in his best-selling book, "Freakonomics," graduate students in economics are focusing on small insights about the economy rather than broad theories that explain how the overall system works. In doing so, they are withdrawing in effect from political debate. . .

"We have lost our optimism that the tools of economics can be used to manage the economy," Mr. Levitt said, "and we have moved to a much more micro view of the world. We can tell you whether labor unions raise productivity or stifle innovation or raise wages, but we are reluctant to judge whether the tradeoffs are good or bad."

That's useful.
Posted by back40 at 11:57 PM | politics

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Thanks for the link! "The alternative is not dictatorship" is not contra Caplan. Caplan says the same thing in the abstract of his book, and mentions the fact that dictatorships have murdered millions of their own citizens.

"All politics can do is hinder the process by squandering resources on pious feel-good policies." Right!

By the way, I am very skeptical of democracy at any level. I think I would restrict democracy to groups characterised by voluntary membership.

Posted by: Biopolitical at January 29, 2006 03:17 AM

Kling says:

Basically, for Caplan, democracy consists of electing a dictator. The only difference between George Bush and Kim Jong Il is that Bush was voted into office and can be voted out of office. . .Caplan does not come out and state this, but the elected dictator model is implicit in his book.

That's why I saw your view as opposed to Caplan's.

Posted by: back40 at January 29, 2006 09:54 AM