Sunday, November 13, 2011

Governments experimenting with people

The consequences of new government policies and interventions are never obvious or fully understood in advance. I've read a lot recently about 'unintended consequences', even 'the law of unintended consequences' described by Rob Norton at the Library of Economics and Liberty:
...that actions of people—and especially of government—always have effects that are unanticipated or unintended.
Some commentators take this 'law' to a sceptical extreme, arguing that since the full consequences of government policies can never be predicted, it makes sense for governments to do nothing.

So I can think of two ways of looking at that: libertarianism and conservatism. Libertarianism simply keeps the government as small and inactive as possible so that it does not get involved in the market in the first place. Conservatism is possibly even more sceptical: by viewing change as a risk of unknown significance it seeks to simply avoid change. Governments in that view should simply continue doing what they have always done.

But it occurs to me that this determination to retain old government policies unchanged neglects the fact that the environment in which they are functioning does change. So an attempt to avoid experimenting on citizens with new policies is vain. Keeping policies exactly unchanged is also a form of experimentation on the citizens as the social and economic environment keeps shifting about.

(A historical example comes to mind from 19th century Japan. In the 17th century the Tokugawa clan seized power and organised a military dictatorship ruled by the samurai military class. Taxes paid by peasant farmers to the samurai families were set at specific levels of rice - absolute levels, not percentages of total rice production - while samurai were forbidden from farming.

Over the centuries the peasants greatly expanded their rice production with improved agricultural technology, and the merchant class likewise grew and prospered. Low level samurai families were in the strange position of having high social and political status, but relatively falling economic wealth, because they were still living off 17th century-era tax rates.

Simply by staying the same the Tokugawa samurai paved the way for their own relative decline. By failing to modernise their weapons they also rendered Japan vulnerable to the Western imperialists. In the mid-19th century the Tokugawa government was destroyed. Standing still was a failed experiment in the changing world of the 1800s.)

Any thoughts, readers? It seems that some experimentation by the government on its people is inevitable under any kind of political philosophy.

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