By letterhead | December 21, 2007
This is Part II of an ongoing series…
The first post in this series got many comments — thank you to all. Especially those who were up for a conversation.
Most comments were from free-marketeers who accused me of being anti-economics. So let’s begin with this: I’m not anti-economics! It’s a wonderful science for managing systems of commerce. What I am opposed to is the use of economics as a “behavioral model of everything human.” This bass-ackwards pseudo-philosophy, unfortunately, is creeping ever deeper into the way we talk about, and make decisions about public policy.
To a large degree, the popularity of using an “economics explains everything” idea to make policy depends on rhetoric, specifically the Pavolvian terminology of “free markets.” This nebulous term has gained enormous rhetorical weight, and a near-utopian patina, in public discourse.
As a blog focused on language and spin, that’s a helluva juicy target!
But first, a funny ice breaker… (to the WayBack Machine!…)
One of the funniest ledes I’ve ever seen in a news article was in a small industry publication called Chain Drug Review, back in 1997. At the time, I was doing research for a ghost writing assignment for a prominent drug industry consultant.
I keep this little gem as a real-life example of how peering up one’s own ass (literally and figuratively) can cause a very special kind of myopia. Here it is:
LAXATIVES AREA IN NEED OF A SPARK
New York – More than anything else, the continuing decline in sales of laxatives is the result of a lack of innovation, according to those involved in the category.
It doesn’t take more than one or two re-reads before all the various nuances of idiocy begin to unfold before you.
Never mind the danger of sparks in a “laxatives area”… fart-lighting images from “Jackass the Movie” anyone? Instead, consider the basic life-questions the article raises:
[head scratch]… In reality, aren’t laxative sales driven by how many people can’t poop? If fewer people are constipated, isn’t that a good thing? Are there really people sitting around conference rooms thinking up ways to push laxatives to “regular” people? If we “innovate” laxatives, will sales go ever-upward? Is a limitless demand for laxatives a good thing, or evidence of a deeply embedded cultural dysfunction?
Sadly, this “news” was reported with a straight face, as if “lack of innovation” truly was the culprit for low laxative sales. As if peoples’ ACTUAL-PHYSICAL- CONSTIPATED NEED for laxatives had nothing to do with it!
Here we have to stop and introduce a new candidate for our dictionary of rhetorical dysfunctions: Hyper-Masticative Reductionistic Reflux Disease.
And now the official definition:
The continual regurgitation, chewing-over and re-ingestion of one’s own arguments; leads to the mistaken belief that theories about reality are more important, relevant, and life-sustaining than reality itself.
And now back to our story of economics. Consider the following entry from the Freaknomics blog:
I have come to the position that the economic approach is a comprehensive one that is applicable to all human behavior, be it behavior involving money prices or imputed shadow prices, repeated or infrequent decisions, large or minor decisions, emotional or mechanical ends, rich or poor persons, men or women…
I applied the economics approach to fertility, education, the uses of time, crime, marriage, social interactions, and other “sociological,” “legal,” and “political” problems …
Good health and a long life are important aims of most persons, but surely no more than a moment’s reflection is necessary to convince anyone that they are not the only aims: somewhat better health or a longer life may be sacrificed because they conflict with other aims … According to the economic approach, therefore, most (if not all!) deaths are to some extent “suicides” in the sense that they could have been postponed if more resources had been invested in prolonging life.
- Gary Becker
Get that man a laxative! And for Heaven’s sake take away that bowl of macerated economic theory before he chokes on it.
Is it true that the only pure “unintentional” death is that of a person who thinks about avoiding death every living moment? (Sounds like fun, sign me up!) Is the universe of human choice unipolar… there’s choosing length of life, and then there’s everything else (i.e., everything that suicidally shortens life), and there’s no overlap?
No. It’s not true. In reality (where most of us live), we could not dedicate every waking thought to avoiding death even if we wanted to. It’s simply idiotic to say:
If I don’t drink this Diet Coke I will die at 82 years, 5 months, 3 days and 1 hour. And if I do drink it I’ll die at 82 years, 5 months, 2 days, 11 hours and 58 minutes. I’d lose exactly 62 minutes. Hmmm… an acceptable sacrifice. I’d be asleep anyway.
It’s idiotic because any fool knows that….
The caffeine in this Diet Coke will help me move my bowels and evacuate the undercooked organic chicken I ate (which was supposed to lengthen my life by 47 minutes, but now threatens to make me sick and shorten my life by 32 minutes). And by early evacuation of the tainted meat, I will balance out the chemicals in the Diet Coke and actually lengthen my life from 82 years, 5 months, 3 days and 1 hour… to 82 years, 5 months, 3 days and 2 hours. (Allowing for an extra hour for dreaming.)
PS… Until the chicken fiasco, I had been a vegan, which should have lengthened my life by 9 weeks, 4 days and 22 minutes; instead the lack of protein was causing early muscle atrophy, which ultimately would accelerate bone loss, leading to a 21% increased chance of hip fracture and subsequent lung embolism that would have killed me 100% dead on my 80th birthday. So now I eat steak, which ironically allows me to live longer than being vegan.
The whole idea is stupid. It’s like tracking down the proverbial butterfly that flaps its wings in the Amazon and causes a typhoon in Bali.
And yes, I believe my ridiculous exercise in hyperbole is exactly the context in which to analyze this theory, because theories are only useful if they have a basis in REALITY. When you dig into how this one might apply to real life, you find quite quickly that it doesn’t. It’s loony-toon. And even from a purely theoretical POV it’s ridiculous, requiring that…
A) we actually KNOW all possible information about what lengthens life and what shortens it, a subject that will keep PhD’s dancing on the head of a pin until the end of time…
B) that each decision has only a positive or negative value, in reality it has increments of both, depending on multiple contextual dimensions
C) that we can consciously process an infinite pool of facts with a doubly infinite number of possible interactions and a triply infinite set of conflicting implications, leading to an infinitely informed decision at every waking moment. (Also, it leaves no time for the sex that is supposed to be good for my heart.).. and finally
D) that we all have access to the same unlimited universe of healthful choices – just try buying fresh vegetables in my (rather poor) neighborhood and then talk to me about “choosing” suicide. (The broccoli I buy is wilted and a bit musty… so is eating it a good thing because it’s a vegetable, or a bad thing because it’s almost rotten?)
Yet somehow this over-masticated drivel passes for brilliance. (Mr. Dubner is positively “floored” by it.) It sounds just like this equally ridiculous idea, which made the news in 2003: the Happiness Equation. A couple of psychologists claimed they had discovered a mathematical equation for happiness:
H = P + 5E + 3H
In this case, thankfully, people took the Happiness Equation for what it was, a lark. And soon enough it disappeared into the ether. People didn’t go off half-cocked and start Graduate School Programs around it.
The issue here is just how far one can push reductionism out of the realm of real life before it becomes completely farcical. (Emphasis on the word “REAL.”)
Try this on for size…
Our ever-expanding innovative laxative market results in overuse. The largest manufacturer then sees new opportunity in the adult diaper market. Then it deliberately subverts research into how to prevent constipation. Then it buys off some politicians who appoint a laxative friendly director to the FDA….
Sound dumb? Meanwhile back in reality….
The Health and Human Services Department tried to launch a hard-hitting ad campaign to get new mothers to breast feed. Lobbyists for the infant formula industry stepped in to stop it. The infuriated companies accused HHS of “scaring expectant mothers into breast-feeding.” The real issue, of course, was maintaining sales of infant formula – independent of whether the formula was needed or even appropriate for newborns.
In reality (yes, where most of us live), the overriding question should be, What’s best for the babies? But screw reality. Getting to the numbers you want is what counts.
And this is the problem with the economic model of behavior: it reduces the basic operating principle of the human psyche to something transactional. Then, when you start BEHAVING that way you get very corrupted thinking and very bad decision making. You get people trying to force behavior in the direction of “getting the numbers you want” because that’s what the theory tells you is the “optimal” outcome… independent of the REAL LIFE circumstances, or the multiple conflicting demands, concerns, influences, objectives, considerations, emotions, contexts, and a million other dimensions of decision making.
The White House has been fudging the numbers on climate change for years, for political reasons related to fundraising. Pfizer is now on the hot seat for lying about its promotional sales tactics for Lipitor. And on and on…
My biggest gripe with the extremist free-marketeers (just add mouse ears and suspenders and you get the picture), is not even that they want to apply “free markets” to non-market contexts (e.g., healthcare and education), but that they think economic self-interest is the sum total of human motivation and we should build our entire social order around maximizing it. An absolutely corruptive and psychologically corrosive force if there ever was one.
Anyway, what “free market” extremists want is not social order or even maximum public good. They are spinning the public toward “free market” policies and institutions because they offer maximum profit potential. The “public good” message point is just window dressing.
To wit: In a fundraising prospectus, Montgomery Securities called the K-12 elementary school “market” the “big enchilada” of profit opportunity – according to Jonathan Kozol’s August 2007 article for Harper’s Magazine. Sounds so altruistic, no? Sounds so concerned about the kids, no? Want to send your kids to an EMO? (Education Management Organization – education HMO style!) Why not?… It’s just like sending them to the nuns!
Free market advocates talk a good game, but talk is what it is. And we will talk about a few more examples in the next installment. In the meantime, go ahead and call me a socialist. I work in financial services, and increasingly in venture capital. I hope to make big bucks and retire in style. The markets have been good to me so far….
I’d be (P + 5E + 3H)* to hear your thoughts!