Professor Elam

Dennis
Elam

April
16, 2009

Word
Count 740

Big Brother is Planning

Lyndon
Johnson observed that politics is all about getting someone else to do what you
want them to do, and believing it was their idea to begin with. Reagan went on
to observe that you could get a lot done in Washington, DC if you let someone
else take credit for it. Those ideas are being ramped up to a new level.

For
a look at where the new Administration is taking us, read Nudge and Predictably
Irrational. Here is what they are all about. The column just commanded you
to read two books. Realistically you probably won’t . Indeed you may well rebel
at the idea of being commanded at all.

Okay
suppose instead  you learned that
two books were the most popular at the Andrews library, that there was a two
month wait to get the books (for a three day checkout given their popularity),
and that 30% of all with a library card had read them. The information contains
no admonition to go read the book. Now, are you more interested?  Might you even read a review or buy it
off the internet, you bet you would.

The
concepts involved are known as anchoring, herding, and the default syndrome.
Anchoring is the process of giving us a starting point. Schools learn to ask
for $100, $250, and $500 donations as silver, gold, and platinum. This brings
in more than asking for $50, $100, and $250. One is anchored to the initial
suggestion of the initial gift. Herding is the process of renaming the get on
the band wagon approach. Obama girl on Facebook was no accident, she was
promoted as a way to anchor the choice of new young voters. The default
syndrome holds that if you are in a situation you are less likely to withdraw.
Hence health clubs get one to sign longer memberships for less per month
realizing that even if not used, people are less likely to withdraw once
committed.  Remember Bill Clinton
saying that he could let us make the decisions with our tax money but we might not
make the right ones?  But wait, he
is going to invest our money, not
spend it.  Hello default syndrome,
once in , the government decides for you.

Hold
on, in the case of cigarette smoking, for once, the government got it right.
Fewer people smoke leading to better health. But on the other hand, like most
reformed smokers, it appears they began eating more, America is growing more
obese. How shall we solve that problem?

The
idea here is that we all need a nudge to do the right thing, eat right, save
money, avoid littering. The Don’t Mess with Texas Campaign was hugely
successful in this regard. The problem of course appears on page 13 where
Thaler and Sunstein reveal their own bias about an ultimate goal.

As the experience with
Hurricane Katrina showed, government is often required to act, for it is the
only means by which the necessary resources can be mustered, organized, and
deployed.

That
is not my recollection. My recollection is the famous photo of the school buses
axle deep in flood water while residents were stranded in  New Orleans. The aftermath saw the
election of the first Republican governor (an Indian Catholic no less) in
decades.   Wal Mart responded
more quickly than FEMA. There are still people living in FEMA trailers for all
I know. Mississippi and Iowa had very different results with very different
governments in a similar situation.

Such
ideas are now at the core of what is about to happen. The carbon tax will
preclude one from finding or using energy, Obama said it would be too expensive
for us to use. He was not kidding. 
Forbid  executive salaries
over $500,000, penalize incomes over $250,000, tax large pickups, subsidize
hybrid cars, the sky is the limit. 
The first carbon tax  effort
failed with Democrat Senators from coal producing states. Which raises the
question, what if the Nudge does not work, then what?

Clearly
the Tea Party  (Taxed Enough
Already) participants ore not being nudged into the Stimulus program. Will the
administration give up this nudge and adhere to their wishes?

We
invite your comments , or do you need a nudge to send me an e mail? 

 

Dennis Elam teaches at Texas
A & M San Antonio and can be reached at denis.elam@att.net.