Bandits at 2 o'clock high?

 

by David Moss
July 2008
updated August 2008
updated January 2010
updated November 2010

 

There is a potential danger on the horizon, bandits at 2 o'clock high, a danger which manifests itself in the form of the following WIBBI (wouldn't it be better if):

WIBBI there was less regulation and there were fewer laws and people just did the right thing because they want to?

This WIBBI has been advocated over the years most energetically by Daniel Finkelstein in his Comment Central blog in the Times and in his opinion pieces. See for example his Comment Central post, 'The five sexiest ideas in politics', where he summarises these aphrodisiacs – social norms, reciprocal altruism, situationism, prospect theory and cognitive dissonance – and re-states the opening WIBBI as follows:

In a nutshell, thirty years ago there was a intellectual revolution centred on economics. Now the change in the debate is being powered by social psychology ... It helps explain how we can change society without increasing burdensome regulation.

Mr Finkelstein refers there to a Sunday Times article, 'Politicians are devouring the work of academics who explain why the carrot beats the stick', and he has returned to the topic most recently in 'The social psychology revolution is reaching its tipping point'.

It's not just Daniel Finkelstein and the Times who want the government to stop legislating and start nudging people into doing the right thing. There has also been a little outbreak in the Spectator, please see 'Nudge, nudge: meet the Cameroons' new guru' and 'A nudge in the right direction'.

And the journalists and the social psychologists aren't just making it up. At least one serious politician places social psychology at the heart of politics – step forward Oliver Letwin, Chairman of the Policy Review and of the Conservative Research Department, who wrote in the Times last year:

Cameron Conservatism puts no faith in central direction and control. Instead, it seeks to identify social and environmental responsibilities that participants in the free market are likely to neglect, and then establish frameworks that will lead people and organisations to act of their own volition in ways that will improve society by increasing general wellbeing.

As Mr Letwin says, some people are likely to neglect their responsibilities. Granted. Those responsibilities can be identified. Who by? Presumably by a responsibility neglect tsar. Then what? It will be the tsar's job to make sure people do their duty. How? By enacting laws? No, by establishing frameworks. What does that mean? It's not clear, but the outcome is that people end up wanting to do their duty, they will do it voluntarily, laws won't be necessary.

A silver star to the child at the back who spots that, far from putting no faith in it, this is precisely a case of "Cameron Conservatism" setting out to achieve "central direction and control".

And a gold star to the one next to her who points out that it's a bit spooky, to say the least, if politicians set out to achieve central direction and control over nothing less than people's "own volition" – at this point, the harmless-sounding WIBBI we started with takes on a decidedly sinister hue, doesn't it?

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Jamie Whyte in the Times takes up the cudgels in ’This is a nudge in the wrong direction‘:

But here is a simple question. If the Government knows what’s best for us, why only nudge us in that direction? Why not give us a mighty shove - as the Australian Government has - by making saving compulsory? Sustein and Thaler reply that nudging is consistent with libertarianism, but shoving is not. And they are libertarians. They advocate what they call “libertarian paternalism”.

Alas, this is as incoherent as its name suggests. Libertarianism is motivated by the idea that a government cannot know what is best for individuals. That is why it is likely to harm us when it attempts to influence our behaviour. Those who favour governmental nudging must think the “central nudger” knows what is good for us. But then they have no reason to be libertarians.

According to Lewis Carter in the Sunday Telegraph:

Every Conservative MP has been handed a 38-book summer reading list to help them think more like David Cameron.

… Tory politicians will be expected to spend their summer break brushing up on history and political philosophy, in a bid to make better and more “Cameroonian” ministers, should the Conservatives triumph at the next election ...

The list includes other “new Tory” set texts. Nudge, the hit pop-psychology book by the Americans Richard Thaler and Cass Sunstein, is described as “required reading”.

The authors’ argue that sometimes voters need a light push to do the right thing, a sentiment that chimes with Mr Cameron’s policies on welfare and tax.

Daniel Finkelstein himself has now been nudged into action, please see ’The politics of nudging‘.

Against all the rules, James Harkin in today’s Guardian has not one but two important things to say in ’This nudging stuff is nothing new - and it’s all a bit shaky‘:

The real lesson is that, while it is entirely possible to isolate the moment at which a small group turn their back on the temptations of crime, or a product bursts its way into public consciousness, it is devilishly difficult to reproduce that effect.

and

The reason why quietly nudging things in a favourable direction seems such a good idea to those in authority is that it promises a magic bullet for social problems - at the margins and on the cheap. The tragedy is while they have been busy doing many little things in the hope that some of them might make a difference, they could just as well have been rolling up their sleeves and doing something big.

Mary Riddell stakes out a limbo in the Daily Telegraph:

I still think Labour holds the answers and that Tory promises of a fair society will turn to dust. Libertarian paternalism, or nudging, is a half-baked political creed pinched by Cameron from the self-help bookshelf. Even so, he has staked out a limbo between the Left’s command-and-control instinct and the Right’s wish to expunge the state from family life. That middle ground is where families, of all kinds, want to live. Labour’s fightback must start there.

Charles Moore is not convinced that a limbo has been staked out at all:

One of David Cameron’s 38 summer reading recommendations for his MPs is a book called Nudge: Improving Decisions about Health, Wealth and Happiness, by Richard H. Thaler and Cass R. Sunstein. It is only the latest example of a genre of book which cleverly identifies something in the zeitgeist, contributes a ‘how to’ element to the problem, and discloses 90 per cent of its message in its title. Small Is Beautiful and Freakonomics are classic examples. After Nudge, I suggest a book called Yank: How to Spot a Trend in America, and Make Millions Worldwide.

You never know where he’s going to turn up next. It used to be the New Statesman. Then the Telegraph and Channel 4. He’s the opposite of the damned elusive Pimpernel, no matter where you look, there he is.

Anyway, this time it’s the Guardian, and this is what John Kampfner has to say, in ‘Why Huggy Cameron has performed a vanishing act’, sub-titled ‘The Tories have slipped back into their political comfort zone, which is a shame for us and a lost opportunity for them’:

… Cameron Mk I was making some interesting noises about fairness, and responsible management practice. Little more has been heard since. Brown, cautious not to offend the City, has said nothing about the underlying reasons for the economic crash. Ministers responded to the collapse of Northern Rock by nationalising and bailing out the bank. No attempt has been made to use the debacle to throw open the debate about the accountability of directors, or the actions of the banking sector. Here is fertile ground for others to occupy. The only person making any noise is the Lib Dems’ irrepressible Vince Cable. The Tory leader is silent.

Cameron now hides behind his new pet theory of the “nudge”. Just a gentle prod in the direction of the boardroom and, hey presto, directors will behave responsibly. It seems that the better politics that he toyed with two years ago has gone the way of the better economic conditions. Now that life is really tough again, with people struggling to pay their bills, so the politics will return to its old bad habits.

It may be thought that this behavioural economics/social psychology business is the preserve of philosophers, psychologists, economists, politicians, their strategists, and advertising executives.

But no. Important people also are showing an interest. The Director General of Age Concern England has this to say in a letter to today’s Guardian:

So-called soft issues require more than soft solutions. Politicians from all parties must realise that it will require more than a “nudge” to improve the wellbeing of older people when part of the problem is institutional discrimination.

And not just important people. Normal people, too. Consider this quite remarkable comment on John Kampfner’s article – which presses several buttons all at once:

I can’t help noticing the resonances between what you describe and Obama’s campaign - or at least his primary campaign. Start off by going out on a limb, and then gradually retreat to your comfort zone as the campaign progresses. Coincidence or deliberate strategy?

We already know that the behavioural economists, with their obsession with “loss avoidance” claim to have experimental proof that negative campaigning works (heaven help us all!). We also know they are into game theory. Perhaps this idea - getting a large crowd of partially-convinced voters on the periphery and then progressively working hard to reassure your core supporters - is their idea of a strategy for defending against the expected attrition of votes due to negative campaigning?

More nudging. Again. It’s cropping up a lot at the moment. This time, on BBC Radio 4’s The Westminster Hour.

The majority of coverage at the moment seems to treat nudging as a bit of a joke. It is dismissed as “pop psychology”. That’s where it’s being anchored, and it may be hard now to promote the notion that it is important and revolutionary.

How the government can influence public behaviour is one question. But just as important, how can the public influence government policy? The government certainly don’t seem to respond to nudging. Or logical arguments based on fact. Or the lessons of history. Or principle. Or petitions. Or marches. So how do you influence the government?

According to The Westminster Hour, the government will respond if two think tanks come up with the same idea independently, as they did with child trust funds. In other words, it pretty well takes a miracle.

Shall we give the last word to Polly Toynbee ...

Senior civil servants could do with training in social research. It’s a sorry signal that the post of chief social researcher has recently been downgraded and subsumed into the Treasury. There it falls into the hands of economists who can be too determinist to tune into the subtleties of social and behavioural questions.

The real value of the new “nudge” economics is not the blindingly obvious finding that it’s easier to use inertia to get people to stay in pension schemes than to get them to volunteer to join.

More valuable is the also blindingly obvious discovery that economists’ reductionist view of humans as rational economic units is nonsense: people’s motivations are just as often not financially motivated, which explains why economists are not very good at predicting even tomorrow’s stock market movement, let alone the next crash.

... and Simon Jenkins?

When muck hits fan, economists always blame politicians. They would have some justice if they did not take credit when things go right ...

The newest craze is “nudge” economics, from the Americans, Richard Thaler and Cass Sunstein. They put the subject firmly among the behavioural sciences - if not the arts. Human actions are too mysterious and unpredictable to be liable to quantification and modelling ... Nudge steers, but does not order or plan ...

Economics has long traded on being a science when it is not. In this it is like war. For a third of a century since the 1976 IMF crisis it has enjoyed great influence over British policy. Now it has met its Waterloo and a little humility would be in order. Once again economics must be rescued by that true master of all things, politics.

28 January 2010: We can make you behave
20 November 2010: How to make people 'love' nuclear power


David Moss has spent five years campaigning against the Home Office's ID card scheme.

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