Reconciling Public Choice Theory and the need for a State

[Dormin111]

Minarchists hold that a state is necesary for the maintenance of objective law in society. Public Choice theory (http://en.wikipedia.org/wiki/Public_choice_theory) posits that the nature of rational actors working within a state will automatically make the state a broken institution unless the government were somehow run by angels. Some economists, like David Friedman, even take this as far as to say that a proper understanding of public choice should lead one to embrace anarchy.

 

Some examples of public choice principles:

- Rational ignorance. Voters know nothing about politics or who they are voting for because it is not worth it to invest the time to find this information given how insignficant their vote is.

- Dispersed costs, concentrated befits. Politics deals in spreading cosats for the sake of concentrated benefits. This creates broken incentives. Most Americans don't support farm subsidies, but are only chagred a few dollars per year for them in the form of taxes. Meanwhile, big agri companies spend millions of dollars per year to get these subsidies. What incentive do voters have to resist?

- Bundled Packaging. When selecting a candiate, voters must select bundled packages of policies as opposed to the standard market practice of slecting individual goods. This leads to many distoritions.

 

I have not heard the topic discuessed too much around here, so I am hoping to hear some opinions on public choice theory from fellow Objectivists.

[Hairnet]

This kind of analysis really shows what is wrong with our system. Republics have always been plagued with businessmen and politicians using force to gain more money. Ancient republics were often ran by crime families that controlled everything. Our founding fathers understood the potential for chaos and tyranny in this because of what history had taught them and their experience with the constitutional monarchy of england, which a lot like a republic.

America has a very sturdy system however. We have numerous devices to keep the govenrment safe from tyranny and corruption. I think that the main problem today is that people WANT business and politics to mix, and honestly every time we have had tyranny in this country it was because the people asked for it.

Edited February 12, 2013 by Hairnet

[tadmjones]

Minarchists hold that a state is necesary for the maintenance of objective law in society. Public Choice theory (http://en.wikipedia.org/wiki/Public_choice_theory) posits that the nature of rational actors working within a state will automatically make the state a broken institution unless the government were somehow run by angels. Some economists, like David Friedman, even take this as far as to say that a proper understanding of public choice should lead one to embrace anarchy.

 

Some examples of public choice principles:

- Rational ignorance. Voters know nothing about politics or who they are voting for because it is not worth it to invest the time to find this information given how insignficant their vote is.

- Dispersed costs, concentrated befits. Politics deals in spreading cosats for the sake of concentrated benefits. This creates broken incentives. Most Americans don't support farm subsidies, but are only chagred a few dollars per year for them in the form of taxes. Meanwhile, big agri companies spend millions of dollars per year to get these subsidies. What incentive do voters have to resist?

- Bundled Packaging. When selecting a candiate, voters must select bundled packages of policies as opposed to the standard market practice of slecting individual goods. This leads to many distoritions.

 

I have not heard the topic discuessed too much around here, so I am hoping to hear some opinions on public choice theory from fellow Objectivists.

How can the  miarchanists'(which I guess is the new term for proponents of limited government ) view be reconciled with what seems like some postmodernist garbledee-gook?  I'm not sure I uunderstand the implications of the posted question

Edited February 12, 2013 by tadmjones

[tadmjones]

This kind of analysis really shows what is wrong with our system. Republics have always been plagued with businessmen and politicians using force to gain more money. Ancient republics were often ran by crime families that controlled everything. Our founding fathers understood the potential for chaos and tyranny in this because of what history had taught them and their experience with the constitutional monarchy of england, which a lot like a republic.

America has a very sturdy system however. We have numerous devices to keep the govenrment safe from tyranny and corruption. I think that the main problem today is that people WANT business and politics to mix, and honestly every time we have had tyranny in this country it was because the people asked for it.

What produced the 'sturdiness' of the American system?

 

Do 'people' employ the same concepts ( business and politics ) the way a rational person would? Do they actually mean they want a coersive government power to oversee every trade?

Edited February 12, 2013 by tadmjones

[Hairnet]

 

What produced the 'sturdiness' of the American system?

 

Do 'people' employ the same concepts ( business and politics ) the way a rational person would? Do they actually mean they want a coersive government power to oversee every trade?

 

Sorry I need you to write your rejections to my point more clearly. I am not sure how to respond to your post.

I think the sturdiness of the American system comes from the knowledge and philisophical discourse of the founding fathers, the fact that the system was a compromise between diverse business interests, ancient anglo-saxon and nordic traditions of oath swearing (contracts), and the fundemental honesty revered in english speaking countries.

So in otherwords, we have a culture that favors honesty, doesn't like tyranny, wants people to obey their contracts, but also expects government and business to cooperate in the name of public interests. These expectations alone explain the behavior of our republic.

Edited February 12, 2013 by Hairnet

[Dante]

How can the  miarchanists'(which I guess is the new term for proponents of limited government ) view be reconciled with what seems like some postmodernist garbledee-gook?  I'm not sure I uunderstand the implications of the posted question

 

'Postmodernist garbledee-gook'?  Public choice economics simply applies a central economic principle (incentives matter) to the behavior of politicians in government as well as businessmen in a marketplace.  Fundamentally, it is about looking at the incentives that politicians actually face, and evaluating how effective a given government program or institution will actually be at achieving its goals, based on how it is structured.

 

To the OP, public choice does point out some endemic problems that are faced by democratic systems.  This is not the same as saying that the system is broken to the extent that we should just go for anarchy.  In fact, we need to know about these incentive problems in order to design a government structure that minimizes them.  Public choice doesn't speak at all to the purpose of government.  What it does do is tell us the likely outcomes of different structures of government.  In designing a government, we could make it more or less robust to a lot of these incentive problems.  This is precisely what things like separation of powers, checks and balances, term limits, state vs federal authority, etc are intended to address.  Public choice allows us to apply economic reasoning to the question of how an elected official or a bureaucrat might behave within a certain system design, and therefore helps us use economics to address how we should structure a government, given the purpose that we want it to fulfill.

 

In short, it doesn't address the purpose of government, or replace political philosophy in this respect.  What it does is tell us how to best translate a political philosophy into an actual structure of government, e.g. a constitution.

[softwareNerd]

... ...public choice does point out some endemic problems that are faced by democratic systems.  This is not the same as saying that the system is broken to the extent that we should just go for anarchy... ...

Are there many commentators who take a "throw up your hands" approach: in the sense of saying "politicians are all corrupt, working to their own ends,... we can never design something good... etc." ?

[tadmjones]

  

Sorry I need you to write your rejections to my point more clearly. I am not sure how to respond to your post.

I think the sturdiness of the American system comes from the knowledge and philisophical discourse of the founding fathers, the fact that the system was a compromise between diverse business interests, ancient anglo-saxon and nordic traditions of oath swearing (contracts), and the fundemental honesty revered in english speaking countries.

So in otherwords, we have a culture that favors honesty, doesn't like tyranny, wants people to obey their contracts, but also expects government and business to cooperate in the name of public interests. These expectations alone explain the behavior of our republic.

In obviously a poor way ,  I was actually trying to show agreement with your points, a "yeah no duh" moment. The analysis by economists as described in the OP 's link seems to take government intervention in all things economic as a given, which I guess from the perspective of analysing data is purposeful. And as has been pointed out economic theories used in that sense are not speaking to the foundations of what government or politics 'should' be , those theories only describe the actions of groups within a particular system. 

 

The only thing I would question, but perhaps you know otherwise , is whether or not the founders' opinions toward oaths or pledges were influenced by any nordic traditions. 

[moralist]

America has a very sturdy system however. We have numerous devices to keep the govenrment safe from tyranny and corruption. I think that the main problem today is that people WANT business and politics to mix, and honestly every time we have had tyranny in this country it was because the people asked for it.

 

You're right. The political majority is getting exactly the government they demanded, and it's exactly the government they deserve.

 

 A peculiarity of the American system of government is that it only works for decent people. The size of government is directly proportional to the number of indecent people who fail to govern themselves. Once a critical mass of indecent people has been reached, the American system fails, and the only possible consequence is tyrrany.

[Dante]

Are there many commentators who take a "throw up your hands" approach: in the sense of saying "politicians are all corrupt, working to their own ends,... we can never design something good... etc." ?

 

I don't know many public choice scholars who do.  Anarchists generally are willing to use the arguments to support their viewpoint, but most public choice economists take the same approach to government that economists generally take to the market: we can improve outcomes with some selective changes.  At least that's my impression.

[ruveyn1]

You're right. The political majority is getting exactly the government they demanded, and it's exactly the government they deserve.

Isn't Democracy grand?  

 

What alternative would you recommend.  A benign dictatorship?  A  monarchy?  An aristocracy based on merit?  If so, who measures merit?  

 

I propose that any scheme of government anyone can thing of,  will within three generations devolve into a tyranny.

 

The revolution must re-emerge in every other generation.  

 

Thomas Jefferson wrote:  The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants. Blood is its natural manure.

 

ruveyn1

[moralist]

What produced the 'sturdiness' of the American system?

Decent people.

 

As I see it, the size and nature of government is a literal expression of how the majority are living their own lives. And the government will never change for the better until enough people first change their own lives for the better. It is impossible to have a decent minimal government in a nation of predominantly rotten people.

[softwareNerd]

... ... most public choice economists take the same approach to government that economists generally take to the market: we can improve outcomes with some selective changes.

Strikes me that there is an analogy here to work by people like Daniel Kahneman. What public choice is to society, his work is to individual decision-making (with loose analogy). In both cases, the knowledge helps us improve the area being studied: public choice or individual choice. Also, in both cases, a cynic could misinterpret the knowledge to say that rationality is impossible.

[moralist]

Isn't Democracy grand?  

It can only be as grand as people are... no more and no less.

I can only recommend a personal alternative...

 

I have no power to affect public policy because I belong to the rapidly dwindling Capitalist minority. The size and nature of government is already being determined by the political majority.

 

My recommendation is to save yourself from becoming collatoral damage of the stupidity of others.

 An aristocracy based on merit?  If so, who measures merit?

 

You can establish that in your own life by working to earn your own merit.

I propose that any scheme of government anyone can thing of,  will within three generations devolve into a tyranny.

That prediction will come true as long as people continue to morally devolve.

The revolution must re-emerge in every other generation.  

 

Thomas Jefferson wrote:  The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants. Blood is its natural manure.

 

ruveyn1

That tree is dying.

Edited February 15, 2013 by moralist

[Hairnet]

 

Decent people.

 

As I see it, the size and nature of government is a literal expression of how the majority are living their own lives. And the government will never change for the better until enough people first change their own lives for the better. It is impossible to have a decent minimal government in a nation of predominantly rotten people.

This is a strategy for obtaining a better society, but I think that you are overstating the case. I also think that a more ethical society would benefit us no matter what the political system was.

Immoral and moral people advocate all sorts of political ideas. I have met scumbag libertarians and I have met centrists who hold more virtue than most people.

[moralist]

 

This is a strategy for obtaining a better society, but I think that you are overstating the case. I also think that a more ethical society would benefit us no matter what the political system was.

While society as a whole can only be as ethical as how the majority are living their own lives, each of us is responsible for setting the ethical tone within the sphere of our own personal influence.

 

That's true.

 

"There are only two races... the decent and the indecent."

 

--Viktor Frankl

Edited February 15, 2013 by moralist

[aleph_1]

We have numerous devices to keep the govenrment safe from tyranny and corruption. I think that the main problem today is that people WANT business and politics to mix, and honestly every time we have had tyranny in this country it was because the people asked for it.

I say we have the most corrupt government in the world in the last 20 years. Our system countenances trillions of dollar of corruption as well as patronage on a massive and unsustainable scale.

[moralist]

I say we have the most corrupt government in the world in the last 20 years.

...and that's only because we have the most corrupt citizens who created that most corrupt government in their own most corrupt image.

Our system countenances trillions of dollar of corruption as well as patronage on a massive and unsustainable scale.

...and that massive unsustainable system is a perfect match for the rotten values by which the majority are living their own lives.

Edited February 15, 2013 by moralist

[Hairnet]

I say we have the most corrupt government in the world in the last 20 years. Our system countenances trillions of dollar of corruption as well as patronage on a massive and unsustainable scale.

Do you have any evidence of this? Over all I would suspect that the US would be on the lower end of corruption, and somwhere in Africa or South East asia to be the worst.

It sounds like you are using a definition of corruption that most people don't use. I think it is important to recognize that the vast majority of things you might consider corruption are expected of our politicians and are often argued to be for the greater good of society, That is, if there were no expectation for it, it would not exist.

In other countries, the government is supposed to work one way, and then it behaves another due to a lack of honesty. However, our government works as intended.

[Dante]

I say we have the most corrupt government in the world in the last 20 years. Our system countenances trillions of dollar of corruption as well as patronage on a massive and unsustainable scale.

 

This is simply wrong, and it's a case of losing historical and global perspective.  Our government is an absolute mess compared to what it should and could be, but the very fact that you're writing about this without fear of prosecution disproves your point, as there are countries out there where you could not write such things about the government.

 

The American government has real and serious problems, but let's not lose perspective and pretend that we have the worst government that ever existed on the face of the earth.  That's just silly.  People talk about us being Greece in the next few decades, but don't forget: Greece is Greece right now.

[moralist]

This is simply wrong, and it's a case of losing historical and global perspective.  Our government is an absolute mess compared to what it should and could be, but the very fact that you're writing about this without fear of prosecution disproves your point, as there are countries out there where you could not write such things about the government.

 

The American government has real and serious problems, but let's not lose perspective and pretend that we have the worst government that ever existed on the face of the earth.  That's just silly.  People talk about us being Greece in the next few decades, but don't forget: Greece is Greece right now.

While America isn't Greece... by popular demand it has adopted the Greek model of European liberal socialist unearned entitlements. The only reason America isn't Greece yet is because we're still riding on the tattered coattails of what the Founding Fathers created... but they are rapidly unravelling. If enough people were to live lives deserving of a decent government, they would have earned the right to get the decent government they deserve. And if they don't, they still are getting the government they deserve.

[Hairnet]

While America isn't Greece... by popular demand it has adopted the Greek model of European liberal socialist unearned entitlements. The only reason America isn't Greece yet is because we're still riding on the tattered coattails of what the Founding Fathers created... but they are rapidly unravelling. If enough people were to live lives deserving of a decent government, they would have earned the right to get the decent government they deserve. And if they don't, they still are getting the government they deserve.

 

Can edit provide evidence for the moral downfall of society, or how an excess of entitlement programs are causing major economic problems? 

Edited February 17, 2013 by Hairnet

[moralist]

Can edit provide evidence for the moral downfall of society,

Sure. The growth of the State is an accurate indicator of peoples' immoral failure to govern themselves.

or how an excess of entitlement programs are causing major economic problems? 

Entitlement programs cause no major economic problems for moochers, nor do they cause problems for the government looters whose economic wellbeing is derived from servicing moochers. However, there is still a major problem for both, but it's not economic. It's moral. As both the serviced and their servicers devolve into less decent human beings.

Edited February 21, 2013 by moralist

[seidlmatic2000]

Can edit provide evidence for the moral downfall of society, or how an excess of entitlement programs are causing major economic problems? 

 

usdebtclock.org has all the numbers.  Medicare and Medicaid together cost $800 billion, Social Security 770 billion, the entire military is 670 billion, and various other welfare is another 350 billion just at the federal level.  To put it in perspective, the government spends $3.5 trillion per year and only takes in 2.4 trillion, a difference of over a trillion dollars.  It's like making $24k a year and spending 35k a year.  The root cause of this is the moral and philosophical problem growing worse in our country since Woodrow Wilson, a statist, collectivist philosophy.