Sunday, April 29, 2012

David Rose thinks some things are just WRONG

Today, I listened to something quite remarkable. It was a podcast featuring economist Russ Roberts with economist David Rose, author of The Moral Foundation of Economic Behavior, who argued that morality and moral norms predict the extent of material prosperity in different societies.

Briefly, Rose's idea is that specialisation - the division of labour into ever more specialised jobs - is a critical part of the massive increase in productivity that caused the economic explosion of the last few centuries, dragging hundreds of millions out of poverty. This specialisation, though, relies on a degree of trust between people, because there will always be individuals with such specialised knowledge that they could cheat those of us who lack it. We can design complex contracts to avoid being tricked but no contract covers every possible fraud, so for financial transactions to take place at all, we have to trust one another.

Rose's fascinating insights, though, are twofold:

1) For a prosperous society, most people need to not only not do obviously harmful acts, they need to also not do certain acts which seem harmless but when done by huge numbers of people do harm society. Rose says that if he concealed his income to cut his tax bill by $1,000 the harmful impact would be so tiny as to be negligible:
We are talking about way less than a penny per person in the United States. People can't even perceive that. It's not even there. Noise swamps it by orders of magnitude. So, no one is harmed.
Nobody is harmed, so why not do it? If one's moral system is based on consequentialism and utilitarianism (that is, based on a concern with avoiding harming people) then minor tax fraud could be moral because no individual would bear a noticeable injury.

Russ Roberts then mentioned Immanual Kant's opinion on how to weigh the morality of an act: 'when trying to decide if it's the wrong thing to do, you should imagine if everyone did it'. Rose's tax fraud might hurt nobody, but if everyone in the US did it, the economy as a whole would be deeply damaged.

Here in Ireland I see this kind of petty fraud and dishonesty quite a bit. Littering is a classic example of something that is virtually harmless when one person does it, but irritating and ugly when masses of people do - and they do. Just days ago I overheard someone talking about pretending to be a college student to take advantage of a student discount. When I worked on a building site years ago I finished work at 6pm and clocked out then, but had to wait in my brother-in-law's car while he worked a while longer. When my workmates heard this they were amused at my innocence, and told me I should sneak back in to clock out later, squeezing pay from our employer for time I spent reading in the car with the radio on.

I didn't, because this was just wrong, it was dishonest.

Another example is adultery. I get suddenly old-school on this one! If one is in a monogamous relationship then there is to be no sex, kissing, even flirting with another person outside the relationship - all absolutely forbidden. But if one's partner was not aware of the cheating, then there would essentially be no victim. You get to enjoy fooling around and your partner is obliviously content with your fidelity. Right? NO! Absolutely no way.

In online debates about morality and law, I sometimes argued with Muslim conservatives that something is sinful only if there is a victim. Therefore things they wanted to prohibit on religious grounds, like music or a woman exposing her hair, are hardly sinful since nobody is hurt. Yet I had to rationalise this to myself with regards to things like adultery or other forms of cheating where the victim may not notice the fraud. My own thinking had just been: well, if they discovered that they were being cheated on it would be hurtful and in the real world there is always a chance of discovery.

Deep down, though, I may have have been motivated by the simple moral lessons taught to me as a child: no, you do not cheat because even if nobody else knows, you know that you've done the wrong thing. Guilt being important here.

 So far this is fairly obvious and many people can probably appreciate that certain activities can be harmful to society when lots of people do it, but not when a tiny number do. What was new for me was Rose's next insight:

 2) For a prosperous society, individuals need to trust others not only to not do those things which are harmful when done by large groups, but also to trust others not to do harmful things for the greater good.

This is sort of genius. Rose had pointed out that people needed to not cheat the system, even when there was no individual loser. But what if cheating the system could benefit someone else? What if there was a greater good with which to justify a harmless manipulation of the system? To Rose, this kind of cheating is still socially destructive because it undermines the trust individuals need to have with one another for transactions to happen and information to be shared:
...if I believe that you might feel more guilty about helping someone that you could help if you cheated me, even though you like me, I still can't trust you. I have to believe that you are the kind of person who would say: Just because you could cheat me a little and help your nephew a lot, you don't do that sort of thing. You don't even think in those terms. That's not on your radar screen. I need to believe that about you to trust you completely, in other words to genuinely trust you because I've reached a rational conclusion that you are genuinely trustworthy.
A truly trustworthy person would be one whose moral code is so inflexible that others know that they would never cheat them, no matter how beneficial it might be to themselves or others to do so. If employees or employers suspect that they will be cheated by those they work with, no matter what the reason, they will withdraw trust, and conceal the specialised knowledge they hold. Society gets poorer, because people cheat to make society richer and more morally responsible.

The bizarre implication is that flexible moral pragmatism that aims specifically to take a sophisticated approach to issues to get the best possible result for everyone could be less pragmatic than unthinking moral conviction. Roberts puts it that 'your grandmother is right':
Meaning your grandmother has a bunch of rules of thumb about right and wrong--don't do this, do this, do that--and if you ask her why or why not, she doesn't have an explanation. She just says: That's always the way it's been and that's the right thing. You are suggesting that if we live that way, or the fact that we have lived that way for a long time is part of the reason we are so successful as a culture. And as an economy.
Listening to this, big pieces of ideas began to click together. I thought first of an old blog post I hadn't gotten around to finishing about American foreign policy in the Middle East: Nikolas K. Gvosdev and Ray Takeyh had written in The National Interest that American foreign policy in the Middle East tended to be based on realism, in which the US tried to secure its access to oil even if it meant supporting illiberal regimes. They quoted Jeane Kirkpatrick's thoughts on the Iranian Revolution in 1979:

The American effort to impose liberalization and democratization on a government confronted with violent internal opposition not only failed, but actually assisted the coming to power of new regimes in which ordinary people enjoy fewer freedoms and less personal security than under the previous autocracy—regimes, moreover, hostile to American interests and policies.

They explained that the US chose to back 'a generation of hereditary monarchs and authoritarian presidents throughout the Middle East' rather than risk pushing those governments towards anti-American communism or Islamism. They argue that this unprincipled, pragmatic approach was a success, keeping the region in American - not Soviet - influence, but I was going to suggest that the Arab Uprisings last year might have proven them wrong in the long term. By backing illiberal monarchs and dictators, had the Americans played against history by alienating themselves from the eventual democratic victors?

 Perhaps unprincipled realism, I was wondering, was unrealistic, not pragmatic. The short-term pragmatic decision to defend oppressive dictators may have damaged America's influence in the area in the long run by alienating it from the future rebel democrats.

Anyway, Rose said that this type of moral code was supremely simple. You do not do those things you know are wrong, ever, for any reason. No justification. No cheating. No opportunistic trickery, even if one intends to cheat only to help others and create a greater good. The ends never justify the means. In its extreme form, this is something many people would approve of already, hence the public uproar about torture in Guantanemo Bay. It is the theme of great fiction like Dostoyevsky's Crime and Punishment where an idealistic young man murders an old woman as part of his grand plan for massive social improvement. No! You cannot murder individuals for the greater good.

 (Strange example I experienced in college not long ago. We were asked in a class on ethics if we thought that ethical considerations in social research were based on simple universal rules, on flexible and context-dependent principles, or on something else. Everyone in the room chose the flexible and context-dependent principles - except me! I said 'something else', arguing that some things are simply unacceptable in social research. No context would justify, for example, researching the impact of child sexual abuse by raping children! No greater good.)

All of this is quite important for me because I have long struggled to reconcile my deeply held moral aversion to killing with the pragmatic idea that armies, police and the threat of violence is necessary to protect civilisation from collapse into brutal anarchy.
And I think this brings us to a weakness in Rose's argument. The simple old grandmother moral rules of thumb were sometimes wrong, very wrong indeed. It was once common knowledge that sexual or racial discrimination was natural and good. There had to be introspection and the replacement of those harmful moral codes with more enlightened ones. I get the impression that Rose and Roberts perhaps see the welfare state too as a cheat, a kind of 'greater good' fraud in which the hard-working and diligent are cheated out of their income by well-intended government redistributions, whereas I would see this as simply a new set of rules, a new contract that people have more or less signed up to through the democratic process. So long as workers know that they will be taxed to help the poor, there is no 'greater good' fraud.

And it really doesn't answer my confusion over the role of armies, police and war. I am still confronted with a personal inhibition about killing along with a belief that states need armies and police, and societies need states to defend modern peace, wealth and order with the threat of violence. Is it ever okay to fight wars when civilians are inevitably going to be killed too? If not do we just have to accept stateless chaos and poverty and violence?

Still. There is a lot to find fascinating in this interview and I definitely recommend at least listening to that. In a world of moral compromise and infinite shades of grey, it is quite refreshing to hear Rose side with simple moral clarity. Intriguing stuff. Rose, with my emphasis added:
Don't do stuff, don't do negative moral actions. Just don't do them; and just because nobody gets hurt, that doesn't mean you can do it, either. Because it's not about the person who is getting hurt or not hurt; it's about you. If you steal, even though nobody gets hurt, you are still a thief. So don't do it. Period. Don't even consider it. Don't even run it up the flagpole. That's not that complicated. And then secondly, if somebody says to you that you should do something that you know is wrong but it's okay to do it because there's this other good thing over here that you can make happen if you do otherwise, you need to realize that that is the language of a charlatan, that that is inappropriate, that you are being sucked in. We don't do things like that.


  1. But I wrote it at 7.17 a.m. on April 30. Just which time zone are you in ? :-)

  2. You (wisely) say:

    "The simple old grandmother moral rules of thumb were sometimes wrong, very wrong indeed. It was once common knowledge that sexual or racial discrimination was natural and good."

    The truth is more "disruptive" than that.

    Sadly, not all "grandmother moral rules" qualify for respect at all. Age, virtue and wisdom do not always go together, although there is real predictive value in assigning a high probability to that.

    A non-trivial minority of grandmothers have very bad rules. Do I need to add that this does not apply only to the distaff side ?

  3. Incidentally, the whole idea (I am not attributing it to you) that "discrimination" - sexually, racially or otherwise - is always wrong, or even "old-fashioned", is a classic of contemporary lazy thinking.

    Discrimination is simply the exercise of judgement by distinguishing people on the basis of their qualities. It is wrong when done on the basis of irrational and unconsidered prejudice, but that kind of behaviour is clearly not the exercise of rational judgement.

    It is cretinous to suggest that people should ignore the sex or background of others *for all purposes*, and even fanatic egalitarians do not campaign, for example, for uni-sex toilets or for sleeping sickness to be ignored.

  4. You say

    "You do not do those things you know are wrong, ever, for any reason. No justification. No cheating. No opportunistic trickery, even if one intends to cheat only to help others and create a greater good. The ends never justify the means. In its extreme form, this is something many people would approve of already, hence the public uproar about torture in Guantanemo Bay. It is the theme of great fiction like Dostoyevsky's Crime and Punishment where an idealistic young man murders an old woman as part of his grand plan for massive social improvement. No! You cannot murder individuals for the greater good."

    I say:

    Bravo !

    I might also mention my own recent post on a similar, or at least related, theme here:

    Sad to say, I am also reminded that a certain "celebrity economist" recently expressed approval for vigilantism, and maintained it, albeit selectively (sort of), after being challenged by me.

  5. Thanks for all your comments Fergus, and cheers for sharing this on Twitter too.

    I think the classic example of sensible discrimination is in one's behaviour when there is a risk of violent crime. Do you choose to walk alone down the nighttime street full of pensioner women, or the street full of teenage boys? We know that an elderly woman MIGHT attack you, but also that the odds of this are much lower than the odds of teenage boys attacking. Many people would discriminate here, wisely, by avoiding the adolescents.

    That said, I think what most people mean when they talk about discrimination is the really harmful and unfair exclusionary laws and customs of the past. One of my favourite authors is George Eliot, a brilliant writer who felt compelled to use a male pseudonym to be taken seriously. It might have seemed natural and obvious back then to dismiss the ability of women to create great literature, for example, but how much we would have lost if we'd stuck to such prejudices!

    I think of various conservative prohibitions on homosexuality as another example. If people stuck to: 'it's JUST WRONG' as a reason for prohibitions and discrimination then lots of unnecessary suffering and injustice would ensue for a long time.

    Still, I haven't actually read Rose's book! So he may go into this in detail there.

    ...And I've no idea why blogspot is operating on some other timezone, had never noticed that before! :S


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