What Went Wrong? 3/24
Why people make better decisions for themselves than for others
An individual who comments here recently wrote,
people are rational when making all sorts of other decisions that are outside their own personal spheres. Why do you think voting is different?
There is an argument that I believe is due to Milton Friedman, but I cannot find a source. It uses the example of buying a coat.
If you buy a coat for yourself, you pick the right coat for the right price
If someone else (a parent, perhaps) says that they will pay for any coat you choose, you pick the right coat for the wrong price (you spend more on a coat than you would using your own money).
If someone gives you a coat as a present, they pay the right price (what they are willing to spend) but get you the wrong coat (one you would not have picked for that price).
If government buys you a coat—wrong coat, wrong price
The same person who makes a careful decision for himself does not make a careful decision as a voter. I respect your rationality in making decisions about your household. I do not respect your rationality as a voter.
An important element of rationality is error correction. And an important part of error correction is figuring out what went wrong when you experience a bad result.
As individuals, we face complex decisions. We have to weigh various factors when we choose a smart phone, make a career move, or pick a place to live. Sometimes, we don’t get the outcome that we expected. Consider this recent news item.
The majority of U.S. workers who changed jobs during the "Great Resignation" actually regret quitting and even feel a sense of buyer's remorse, according to a new survey.
The article offers one possible reason.
it's "hard to assess the culture of a new company through Zoom." Prior to the pandemic, candidates would generally be able to visit the office, ultimately allowing them to better gauge a company's culture.
Regardless, "it's this really damaging phenomenon where people are brand new in our role, and they suddenly realize it's not at all as advertised," she said.
When people make mistakes, they usually try to make better decisions subsequently. To do this, you have to acknowledge that you made a wrong choice. Next, you have to examine the process by which you made the choice, in order to theorize about what would have produced a better outcome. The next time you face a similar decision, you try to correct your decision-making process.
People can experience bad outcomes when they vote. Your preferred candidate or policy could lose. Or your side could win and produce bad results. But chances are, you will not go through an error-correction process. Very rarely will a voter say, “I made a mistake. What went wrong? I need to review how I made my choice, so that I do things differently the next time.”
There are two reasons that voters do not engage in error correction. One reason is that one person’s vote almost never affects the outcome of an election. It does not pay to invest effort in figuring out what went wrong and trying to correct it.
Another reason is that political outcomes are more complex than personal outcomes. If you realize that you made the wrong choice in buying a smart phone, there are only a limited number of possible reasons. Chances are, you can identify what you did wrong.
But when economy-wide inflation breaks out, there is disagreement even among credentialed economists over its causes and treatments. I believe that the inflationary course was set by President Trump’s policies. But that does not mean that those who voted for Mr. Trump in 2016 will say to themselves “Aha. I was wrong.” Perhaps they would say that, all things considered, they still think that Mr. Trump was the right choice. And even if they were to view their 2016 vote as an error, what correction should they make now? When it comes to inflation, switching to the Democrats, whose policies probably made inflation worse, is hardly the answer.
In short, I believe that collective choice means bad choice. We treat voting as a sacred ritual. Then we elect officials who scare us into handing more decisions over to government. We put unwarranted faith in our right to vote, while letting too many of our other rights get taken away.
Friedman does a version of this "four ways to spend money" in "Free to Choose".
Seems like a strong argument for the most limited government possible. The more that decisions are left to the individual, the more rational those decisions will be.