Irrationality in politics

Does rationality matter in policy-making? I ask because of three examples:
1. The use of the private sector in welfare-to-work has not delivered the expected gains. But there’s no sign of James Purnell reversing his enthusiasm for such schemes*.
2. When I point out that immigrants have only a minuscule effect on the job prospects of native workers, I’m told that the evidence is irrelevant.
3. The global recession is raising demands for protection against free trade. This is illogical. The question: does free trade hurt workers relative to some set of protectionist policies? can be answered independently of the state of the business cycle; it’s not the case that free trade is good in a boom but bad in a recession. The recession is just raising the salience of the gross losses from free trade; it’s not systematically affecting the net gains.
These examples, I fear, are in some ways more important than  religion. If you believe in creationism or the flying spaghetti monster, no-one gets hurt. But if you vote for protectionism or policies to hound the unemployed, people do suffer.
It’s enough to make one sympathize with Bryan Caplan. And it raises the question: what is the value of democracy, when this can conflict with rationality, utilitarianism or the rights of individuals?
* It’s possible Purnell is acting rationally here, though. He might figure that the cost of abandoning such schemes - taunts about “U-turns” from idiots - would outweigh the increased respect he’d earn from people like me.

Comments

[Marcus Hunt]

1.
There seems to be a problem with the first link: it puts you straight on to "Liberal Conspiracy". Quite how such a biased load of tripe could prove anyone's point in any contect is beyond me.

2.
Unless I have missed something you have never had a proper job. You have absolutely no way of judging the rights and wrongs of such an issue, except by relying on bogus research and cross-referencing it with other "analysts" all getting balder and fatter in other cosy offices.

3.Ditto

4. Much as I despise the hypocritical, I- know-best-fundamentalism of the 100%-certain, atheist,knee-jerk, I know best anti-religion lobby, be it Dawkins ot Attenborough, I do that purely from the logical standpoint that (in my view) agnosticsm is the only reasonable viewpoint. However, much as I defend the right of the religious to live in peace, it is quite possible their views CAN hurt people. That is, just as much as protectionism may hurt people..er, or not, since the latter IS A MOOT POINT.

In short, this is, as usual a very sloppy piece of blogging. I don't really hold "analysts" in contempt over people who have "real" jobs but the postings on this blog are continually what I refer to as "backthink". That is, you have your own pre-conceived notion and then fit the facts to the theory; and then apparently rely on some idea that you have analysed the evidence and are in possession of incontravertible facts and understanding, facts and understanding apparently lacking to the abused working classes or the religious. At least, unlike those groups, you have the warmth of and office comfort of certainty..

[Leigh Caldwell]

It never occurred to me to check what your job is before evaluating your arguments! Maybe I should start doing that.

You are probably familiar with Anthony Downs' book, An Economic Theory of Democracy (from way back in 1957) about rational ignorance in voting - Bryan Caplan mentions it in his piece. I guess that a corollary of this may be that politicians implement rationally ignorant policies.

There's another explanation, related but not quite the same, essentially based on political capture by interest groups. I think I first read this in Undercover Economist: some notes on how it works are at http://www.knowingandmaking.com/2009/02/more-protectionismsigh.html

I do think that, in the long run, policy will converge to the rational. But a lot of damage can be done in the meantime, and it's important for informed people to keep doing the analysis and keep making the case for what works.

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"The use of the private sector in welfare-to-work has not delivered the expected gains."

Unless there is evidence that such schemes have made things worse, what would be the point of a U-turn?

[Katie M.]

I think there's a distinction between politics and policy here.

Also, I think 1 and 2 come down to what is described as policy-based evidence making.

[Miguel Madeira]

"The question: does free trade hurt workers relative to some set of protectionist policies? can be answered independently of the state of the business cycle; it’s not the case that free trade is good in a boom but bad in a recession."

There is an argument for free trade being "good in a boom but bad in a recession":

http://krugman.blogs.nytimes.com/2009/02/01/protectionism-and-stimulus-wonkish/

[john b]

@ Marcus: the LC article summarises stats from an FT article that looks at the actual data. Its LC-ness is as irrelevant; it could be published by David Duke or Kim Jong Il and the FT's data would still be the relevant point.

[Wei Xingnong]

I think I was the one who told you your post on the overall effect of migration on jobs was irrelevant. It was - irrelevant to the wildcat strikes, which you chose to link your posting of same to. You're not "rational" on this, you're Mr. Logic: completely clueless as to what motivated the walkouts up and down the country.
The questions raised are not about the value of democracy, but about the value of poindexters such as yourself who pronounce pompously on matters they may have every long-term study under the sun about but haven't taken five minutes to actually understand.

[reason]

"And it raises the question: what is the value of democracy, when this can conflict with rationality, utilitarianism or the rights of individuals?"

First - can be have one issue at a time. Second - the value of democracy as against EXACTLY what alternative?

[reason]

Leigh Caldwell
Good post.
But in general the problem with Caplan's argument is that it is assuming that the point of democracy is to find the best policy. The point of democracy is to give everybody an equal voice (i.e. to have a government with some sort of reasonable legitimacy). How intelligently, that voice is used is a completely different question.

Caplan wants to say - we can't give these people power because they won't use it well. Maybe not, but that have a right to that power, and that is another issue entirely.

[reason]

My own view is that we need to strenghten a meme that says that rights always come with responsibilities. Everyone has the right to vote and the responsibility to use that vote wisely. (Just as the right to own property comes with the responsibility to pay taxes).

[john b]

"completely clueless as to what motivated the walkouts up and down the country."

Ignorant bigotry, impotent fury, and fear. Next.

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Bigotry and fury are not required. Merely fear, and a belief that it is easier to drive foreigners out of the workplace than other groups.

[RSE]

Bigotry is the foundation stone of most social organization, and will doubtless remain so for the forseeable future due to the boundless pleasure it brings people.

[Rohan]

Erm this is rubbish. Firstly the FT article was comparing apples and pears. Yes the number of job entries is down - and this has meant the amount of money being paid to contractors has gone down (the 98% figure does not relate to payments to these companies).

The contractors are still obliged to provide the back to work support (or pull out of the contracts) and the tax payer will save a lot of money over the next three years because of the contracts. The funding available through the contracts was exactly the same as is available for Jobcentre Plus Pathways to Work areas (40% of the country). However to receive that same level of funding the contractors would have to deliver a lot more job outcomes under what they agreed.

If the Government had used the public sector (Jobcentres( for all of the country then it would have spent £1.1 billion regardless of how many people got jobs. This is likely now to be only around ~£700m. The companies did indeed overbid and may be more risk adverse in the longer run but in the meanwhile it’s great news for the tax payer.