Tag Archives: Policy

Ever since I read Umair Haque’s “Betterness: Economics for Humans,” I’ve been sold on the idea that we need measures other than GDP if we want a more meaningful picture of an economy’s health. He likened GDP to a car’s speedometer – a one-dimensional measure that simply tells us how fast or how much, and nothing else. Yet we care about much more than the speed of our car: we should also be measuring our fuel efficiency, how many RPMs are needed to get us up to that speed, and if we were up-to-date on our maintenance. By creating and publishing new measures of the economy’s performance, we could begin to broaden our conception of what makes a healthy economy. This new concept would be informed my measures of things that actually mattered to human happiness: people’s reported work-life balance and job satisfaction, the rate of environmental degradation and the resulting human costs, and the stability of our economy over time. The list of measures he and other economists have proposed goes on for much longer, and this list is only my quick recollection of the ideas he mentioned. And these measures aren’t new ideas – we’ve already measured most of them for awhile; the point is that by collecting them more rigorously and publishing them more frequently and broadly, we could promote a more nuanced picture of economic success.

All of this explains why I was excited when I read the headline, “The US government could soon reshape how we measure the economy.” It also explains why I was disheartened to find that the new measure was actually Gross Output. I recommend you read the article for an explanation, as it does a much better job than I could. The key takeaway for me is that while this measure shifts the focus away from consumer spending’s effect on the economy – which I like – it also shifts the focus towards “savings, business investment, technology, and entrepreneurship.” This measure fails to broaden our view of a successful economy to include environmental and social concerns, and instead places a great emphasis on how businesses and the elites in our society are doing. That haven for job creators, the op-ed page of the Wall Street Journal all but confirmed this as the author wrote: “[an emphasis on GDP] has led to the misguided Keynesian notion that consumer and government spending drive the economy rather than saving, business investment, technology and entrepreneurship.” 

Business owners, investors, corporations, people who fastidiously save their money, technology firms, wall street bankers, manufacturers – all of these groups are crucial to our economy’s success. Hell, if they get excited about Gross Output, let them have it. It’s never a bad thing to have more information about how an economy is performing. Yet our economy (and our political system) already caters to these groups’ interests and is too dominated by their whims. If we’re taking a hard look at new measures of economic prosperity, why not explore measures that help us re-balance our economic priorities, instead of driving it closer to the “growth at any cost” mentality?

Legislators won’t touch the student debt problem until it’s too late

“It’s not just about providing people with information. It’s really about creating a system where student loans aren’t overemphasized.” This article points out precisely what is wrong with how we finance higher education. I’m sick of our representatives not wanting to take on the issue of massive student debt, so instead they push for legislation that will help students make informed financial choices about college.

I’m all for informed financial decisions, but when it comes to college, students will finance their education any way they can. The alternative of not attending shuts too many doors, so they’ll take out massive debts even if they know it will burden them for years. Legislators know this, but the real problems with student debt are too politically tricky, so they won’t tackle them. http://www.npr.org/2014/04/11/301439981/paying-off-student-loans-puts-a-dent-in-wallets-and-the-economy?ft=1&f=1013

A Case for Optimism on the Health of American Society

This post, from The New Yorker’s Maria Konnikova, provides some hopeful news for those who feel constantly stressed by all of life’s distractions and challenges. It shares the results of a study undertaken by the University of Miami that show with only three 20-minute meditation sessions per week, students became much less stressed and did better on memory and focus tests that were administered throughout the semester. Getting less stressed as a semester of college progresses and professors unload mounds of homework on you seems impossible – yet apparently a bit of meditation does the trick. It gets better too: not only does practicing meditation affect these improvements, but it also prevents your levels of stress and memory from worsening. While the group who undertook the mindfulness sessions showed less stress, and a greater ability to focus and use working memory, the control group who did not receive any mindfulness instruction worsened on the tests as the semester progressed.

Finally, you come to the last sentence of the article – “It’s a cultural shift.” This sentence refers to the growing recognition that, just as exercise does wonderful things for your physical health, mental exercise improves your mental health. I love this sentence because it gives hope to people (like me) who worry that the prosperity we enjoy in modern societies have made dulled our senses and left us stagnant, both individually and culturally. It shows that while our lifestyles in wealthy democracies may have unleashed a torrent of perils on our health, our societies, and our world, we still have the power to listen to the evidence, and shift our behavior and opinions for the better.

This might seem like a lot to takeaway from one research study on the mental health benefits of regular meditation, but I feel my conviction strengthened by another hopeful trend: the shift of public opinion towards marijuana legalization, and the accompanying debate around the merits or flaws of this approach. I personally think the legalization of marijuana would lead to a more just society, by funneling money away from cartels and ending racially biased penalties for using a comparatively harmless drug. Yet just because more people are starting to agree with my opinion doesn’t automatically mean that society is progressing – my ego isn’t that big. No, what makes me optimistic is that people are looking at the evidence on how successful the war on drugs has been, and they’re looking at their own experience with drugs, and deciding that we need to start considering different approaches. This new willingness to discuss issues about drugs isn’t just about legalization though, it’s also opening up important debates about addiction and drug abuse, not only for weed but for alcohol and other drugs as well. The opening of this national debate is epitomized by the President’s recent assertion that pot is less harmful than alcohol or cigarettes, and then re-affirming that message in an interview with CNN’s Jake Tapper. In the interview, he also signaled his willingness for decriminalization of marijuana, and called on legalization advocates to ask themselves tough questions about the unintended consequences legalization could have (e.g., the potential for more drug abuse). It’s refreshing to have our president finally speak to us like reasonable adults – even if in other areas, he seems to think public opinion is just misguided and needs a good ole’ government public relations campaign to change their minds (read: NSA leaks). If we really can have a national debate around these issues, it would show a maturity and honesty that would make me more hopeful about the health of our body public.

Put simply, the message these trends deliver is powerful: progress towards a better society is never certain, but we can make it happen if we strive towards it in our personal lives, and in our participation in self-governance. 

‘Buzzkill’ – The unexpectedly complex challenge of marijuana legalization

‘Buzzkill’ – The unexpectedly complex challenge of marijuana legalization

Please read this great article by Patrick Radden Keefe. It delves deep into the question of, “so, exactly how do you set up a legal market for marijuana?” This turns out to be a complex and little-understood policy problem that requires foresight, novel thinking, and a willingness to experiment. It’s a long read, but it’s worth it to understand this unique new frontier in public policy, and the eclectic characters and interests it’s attracting.

To give you a taste of some of the complex issues and policy wonkery involved, take a look at this passage:

For years, Kleiman’s resistance to outright legalization was based, in part, on a fear that commercialization of the drug could triple its use. But when he arrived in Washington State he proposed an audacious solution. In order to curb problematic consumption, you could introduce a license for using cannabis. We issue licenses to drive a car or to own a gun—why not a license for consuming recreational drugs? Any adult could obtain such a license, and the license could stipulate a quota for personal monthly use. This quota would be set by the user, and could be large or small. But, once the consumer had set a quota, it could be changed only in writing—with a month’s notice. Such an innovation could counteract the dangers of excessive, impulsive use by encouraging individuals to set their own limits. Users could set very high quotas for themselves, of course, but the provision would nudge at least some citizens into being more responsible. To work properly, a personal-quota system would need a central database of marijuana users, which would allow I-502 stores to determine if customers were trying to exceed their monthly allotments.

When I initially read this, I felt immediate disdain for the idea of pot consumers needing a license to purchase marijuana. This would just be another way of enforcing the stigma around weed and would add needless regulatory costs. Indeed, I still feel a bit uneasy with the idea. But as I read the idea about the one personal-quota system, I realized how useful this system could be in keeping down consumption while still allowing total legalization: it would be like setting a New Years resolution to workout more or drink less, but only being able to break your resolution by walking to a counter, looking another person in the eye, and telling them that you just didn’t have the motivation or willpower to stick by your resolution. How often have you thought that you could really do something – eat right, wake up early, socialize more – if there were someone holding you to it. Of course, this idea shouldn’t be applied to all those areas of life, and the freedom to make our own decisions shouldn’t be given up lightly. Yet, though I detest encroachments on liberty, I understand that humans don’t always make the most rational decisions and sometimes could use a little nudge (as Richard Thaler puts it). I find myself irresistibly curious over what effects such a policy could have on reducing some of the problems of dependency, while still giving us total freedom to make our own decisions. Yet, alas, this seems to be a personal quirk that I share with the proposer of this idea, and not many others, as the article informs us:

Kleiman’s solution was ingeniously eclectic—a hybrid that balanced individual liberty and state control. Nobody liked it.

Ah well, another innovative policy experiment foiled. Consequently, this story raises a much larger question about the effectiveness of public policy in general. This is a question that we should all ask ourselves at the 50th anniversary of the Great Society reforms, and it is: “is the amount of resources we spend designing and implementing these policies worth the costs they impose?” While I firmly believe in the need for public policy in building a fairer and better society, I can’t help but be struck by a pattern in all policies that the article’s author observes:

It appears that I-502, like so many government programs, will be flawed from the start, and will demand patchwork modification in the coming years. One imperative of political life is that, at a certain point, you have to stop formulating a policy and start selling it

All new large-scale policies will require lots of tweaking, simply because the world is complicated – that’s true in any case. Yet sometimes you get the feeling that as interests become increasingly entrenched, professionalized, and territorial, it is becoming harder to formulate public policy that is truly innovative, inspiring, or even sometimes effective. I’m no pessimist or libertarian though, and I think government will always need to help us do things that are done better together. Is the ACA rollout flawed? Yes, but just look at all the lives it will save from disease or financial ruin. Should the NSA be pounded back to its place behind the line of the Fourth Amendment? You bet, but that doesn’t mean that the government shouldn’t try to alleviate social problems through policy.

In any case, I’ll stop rambling now, and let you enjoy some great reporting that manages to tell a compelling story while providing in-depth analysis of policy issues that will provoke you to examine where you stand on the issue – truly, a rare and valuable combination.

Republicans are setting a precedent which, if followed, would make America ungovernable…If a party with such a modest electoral mandate threatens to shut down government unless the other side repeals a law it does not like, apparently settled legislation will always be vulnerable to repeal by the minority. Washington will be permanently paralysed and America condemned to chronic uncertainty.

The Economist, weighing in on the government shutdown. It’s unbelievable that people who managed to get themselves elected to the US House of Representatives – people who have been playing the game of politics for some time now – don’t see how dangerous of a precedent they’re setting by demanding the repeal of legislation as a condition for keeping the government functional. Wanting to shrink the government is not unreasonable, but shutting down the entire federal government if you don’t get huge policy concessions sure as hell is. You simply can’t maintain that dynamic in a democracy, as this quote points out. 

The only two explanations for this unfathomable ignorance of their chosen profession are both terrifying. The first explanation is that they’re so unreasonable and blinded by ideology that they think this is the right thing to do for America’s long-term prosperity.  The second explanation is even more terrifying: they know exactly what they’re doing, and America’s electoral and political systems have now been warped to the point that they actually encourage this type of obstinate and radical behavior. Whichever is true (and sadly, I think it is the second), the outlook for America is grim unless one of these two problems – extreme polarization or institutional sclerosis – is fixed.

US Policy Making: Broad or Narrow Framing?

senate debate
As I’m reading Thinking, Fast and Slow, I came across an idea that seems to pose an interesting question for students of US Congressional policy making. When deciding whether to vote aye or nay on a measure, do they frame the decision narrowly or broadly? As Kahneman describes it, narrow framing is when sequences of simple decisions are considered separately, whereas in broad framing the sequence of decisions is grouped into a single decision with several options. Our minds naturally frame decisions narrowly, and, combined with our natural aversion to losses, this often leads us to turn down slightly risky decisions as they appear to us. When our friend asks if we’ll accept a coin toss where heads gives us $200 and tails makes us lose $100, most of us would not take it because we would feel the loss more steeply. However, if he were to offer us 100 coin flips under the same conditions, we would surely agree to the terms – we intuitively understand that aggregating the risks together reduces our potential losses. Indeed, if we did accept the 100 coin flip gamble, with $200 gained for heads and $100 lost for tails, we would have an expected return of $5,000, with only a 1/2,300 chance of losing any money and merely a 1/62,000 chance of losing more than $1,000. Anyone who refused this bet would be considered insane.

So what does this have to do with our daily lives? Well, it suggests that we shouldn’t frame risks narrowly as isolated one-off risks, but rather as one risk in a series of risks that we are likely to encounter in the future. This works when the risks are relatively small risks with simple options, and they don’t threaten our health or wealth in a way that would make life unbearable. For instance, when you have the opportunity to buy tickets to a concert that you want to see, but you are afraid the cost of the tickets is high and the performance might be disappointing, you should frame the decision in the context of all the other live events you are likely to buy tickets to throughout your life. If you aggregate all these decisions, you can more easily accept a single loss (spending too much money on a mediocre concert) in the knowledge that you will likely experience gains in the future (going to an amazing concert for a lower price than you valued the experience). Thinking this way helps us combat two irrational biases that we are all hard-wired with: our tendency to overweight losses in decisions, and our tendency to display inconsistent preferences because we view each decision in the immediate context in which it is posed to us. Simply by stepping back and framing a decision in terms of long-term considerations, we can make our preferences and decisions more consistent and logical.

Now, apply this type of decision-making framework to voting in Congress. Each vote is a risk where several potential gains and losses are weighed, but which ultimately comes down to a simple choice: vote yay or nay. Consider a Democratic Representative from a swing district in a Southern state with large coal mining companies wants to vote for a law designed to increase water quality by imposing regulations on mountaintop removal coal mining practices (which essentially blast the tops of mountains to get at coal underneath, and can contamiante water supplies with the debris from the blast). They must weigh the potential gains (more votes from left-leaning constituents, more campaign funding from the environmental lobby) against the costs (loss of votes from right-leaning constituents, angering constituent businesses).

How would a Congressperson frame this decision? Would they frame it in isolation with all only its immediately surrounding consequences? Or would they frame it more broadly as one vote they will cast among many that will aggregate together?  I suppose the most obvious answer is that they frame their votes broadly – how else do you describe the phenomenon of political horse trading, where a lawmaker casts a crucial vote on one issue that they otherwise would not have cast in exchange for support on a later vote they prioritize more highly? However, I can very well see a case for narrow framing as well: policy aides and political advisers constantly remind the Representative how each vote will look to constituents back home – in effect, focusing their attention narrowly on the one decision.

I honestly don’t know the answer to this, and frankly some votes may be too complex of decisions to correctly apply broad framing. I claim no expertise in behavioral science; this post is merely a fleshing out of my thoughts as I read through this challenging and delightful book. Still, I think this is an interesting topic and I’m excited to see what insights come as we apply insights from the decision/behavioral sciences to political science.