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Source link: http://archive.mises.org/8126/libertarian-paternalism/

Libertarian Paternalism

May 21, 2008 by

To devise a libertarian paternalism seems no more promising an endeavor than to construct a square circle. Our eminent authors, though, are not convinced: libertarian paternalism is exactly the position they wish to defend.

Their escape from apparent contradiction is ingenious. It is indeed unlibertarian, they say, to use force to compel someone to act for his own good. They do not favor doing so; but this leaves them free to support a less exigent variety of paternalism. It is all right to render it difficult for people to make certain choices, as long as doing so does not impose substantial costs on them. People, as their title suggests, may be subject to paternalistic “nudges,” so long as these nudges do not coerce them.

But they lack a rational basis for limits. FULL ARTICLE


Art Thomas May 21, 2008 at 9:21 am

“Thaler and Sunstein are right to think that the standard model is flawed, but they themselves remain too much its prisoner.”

In making these nudging choices to influence other people, it seems to me they and other potential nudgers would be faced with the same problems: they too are subject to faulty reasoning and conflicting feelings. And so perhaps the nudgers too have selected a poor way to achieve what they “really” want.

Keith May 21, 2008 at 9:46 am

Things like this always remind me of one of my parents’ friends from when I was young. He would always spend extravagantly on vacations and cars and all manner of “luxuries” which my parents thought were stupid and a waste. They thought he should be saving for something practical, like retirement. Then he died of cancer in his early fifties and it made me think, maybe he wasn’t so stupid after all.

I wonder how the paternalists would measure the costs in this situation?

Byzantine May 21, 2008 at 10:41 am

In making these nudging choices to influence other people, it seems to me they and other potential nudgers would be faced with the same problems: they too are subject to faulty reasoning and conflicting feelings

Indeed. And the premise is absurd: “Instead of throwing you in prison, we’ll just handcuff you.”

Sunstein used to keep his Marxist candle under the bushel of “critical legal theory.” Looks like “libertarian” is all the rage now.

Brian Gladish May 21, 2008 at 2:58 pm

A very good review of a misguided concept. Michael Shermer’s book The Mind of the Market, which I reviewed on this blog, also pushes “libertarian paternalism” at its conclusion. It seems our greatest problem is the almost universal desire of humans to impose their values on others – the interventionist spirit.

Fred May 21, 2008 at 3:04 pm

It does not matter how small the nudge is or how good intentioned it is. It is coercive. The proper approach, to convince someone you think, according to your values, needs a nudge, is a patient, logical argument. If you do not succeed your options are to try again or quit. Patience and the capability of making a logical argument must not be within the capability of Thaler and Sunstien. Realizing that they require coercion to override the values of others, they have proceeded to justify coercion. They try seduction to justify taking a tiny step along the “road to serfdom”. However, most unconscionably they are trying to hijack the term “Libertarian” in the process, giving it the same fate as “Liberalism”.

toolkien May 21, 2008 at 3:06 pm

It seems that when “unnatural”, broadcast attempts are made to nip the lower tail (the “problem”) of the distribution curve, it inevitably affects the upper tail driving both closer to the average. Who wants average? As long as there is freedom, those who choose behaviors that drive them to the lower tail, and suffer the consquences, eliminate themselves, and those who make sounder choices, and better choices than the average, enjoy greater rewards. Pretty simple.

Really, no matter how one contrives equality of outcome it is all the same. Complete “average-ness” of homogenous sameness is a dystopia too.

But then I have no doubt that those geniuses who successfully implement the plan will be exempted from the spam souffles.

matt butler May 21, 2008 at 3:57 pm

So long as the “nudge” violates no one’s property rights or life it should not matter to libertarians; indeed they should favor it. However, as the state produces nothing of value and is therefore totally reliant on force to achieve its aims, it is unlikely that such a means can even be devised without violating someone’s property rights.

The only place that the “nudge” does not violate specific property rights is on government property. Yet as libertarians we try to limit state property in favor of private property. While nudges on government property may be helpful, they ignore the larger problem of government as a property owner in general.

Matt May 21, 2008 at 8:37 pm

David Gordon, this book “Nudge” really does not deserve a review. It focuses on minutiae and endless side issues such as are the religionists discussions of the ‘ camel passing through the eye of the needle’.

This is exactly what we should not focus upon but rather on the quote of Alexis deTocqueville at the end.

There is no ‘nudge’ involved today when laws are passed that curtail Inalienable Individual Rights that are enforced at the point of a gun.
Thomas Jefferson where art thou?

Dmitry Chernikov May 21, 2008 at 9:14 pm

Why can’t nudges be cultural in origin rather than governmental? Isn’t culture and its non-coercive influence a much more subtle tool of changing behavior than the state? If the great majority really detests smoking, then restaurant and bar owners can disallow smoking on their properties, parents can punish children more severely for smoking, people might refuse to associate with smokers, movies and TV shows might include anti-smoking propaganda, etc. If smoking is considered bad taste, then government nudges seem superfluous; if it is not, then they should not be attempted in the first place.

And then there is this argument from Rothbard: “it is surely grotesque to entrust the function of guardian of the public morality to the most extensive criminal (and hence the most immoral) group in society — the State.” Why assume that the government will nudge people towards something they will (perhaps later) appreciate rather than something bad? This ties in with Art Thomas’s excellent comment: who nudges the nudgers?

Deacon May 21, 2008 at 10:06 pm



It is not PATERNALISM, folks, but MATERNALISM.

The feminine mind is far more controlling than
the masculine mind, as the former is keenly
interested to keeping the kids under her wing
while the latter, generally, doesn’t give a damn!,
except to kick the kids out and allow them to
learn to survive–providing them with the best
chance of survival by his hard-knocks
approach to child-rearing.

Read and learn:

Underlying Psychology of Politics


M.D. O'Donnell May 22, 2008 at 12:22 am

Before we devolve into a wildly inaccurate discussion of “paternalism” as a metaphor for the family, it should be noted that “nudges” already exist in the free market, and are indeed the very soul of that market.

For example, the smoking issue that the author raises: I am entirely, under the protection of Libertarian policy, within my rights to burn my lungs to ash with as many cigarettes as I can buy. I am not polluting inside atmospheres (like bars and clubs, owned privately, whose rules may be different than the public street) nor am I stealing cigarettes to feed my habit or forcing my children to smoke against their wishes. The habit is entirely mine. Also, as we all know, are the physiological repercussions: emphysema, cancer, hypertension, etc.

The insurance company who helps me pay my medical bills, also protected under Libertarian policy, is not required by federal or local mandate to cover medical expenses for my self-inflicted early demise due to cancer and lung failure. Therefore, knowing that I will not be covered for damage of my body due to smoking, it is in my best interests NOT to smoke myself into oblivion. I have the CHOICE to accept the consequences of my stupid actions or remedy my behaviors in order to produce a better result in the long run.

In other words, the “nudge” already takes place within the risk/reward section of the free market. The risk of dangerous behavior is taken more seriously when the consumer is ultimately financially responsible for the consequences of his actions. Libertarian policy doesn’t “nudge” people into moral behaviors like a soft nationalism or socialism, it simply creates an open arena of choice so that the most moral option for the individual can also be the most financially beneficial.

Now, as to whether things like lobbies, corporatistic hegemonies and legislative monopolies will “choose” to serve moral aims, I can only respond that they are by their nature collectivist, and “for the greater good,” i.e. against the individual’s own liberty, traded for an unsecured future benefit not guaranteed by evidence, logic, or contract. The individual can choose the most moral and the most financially responsible option available to him; collectives, not being self-interested individuals, cannot. Hence, government must step in as a barrier separating the Economy and the State.

Tao Te Ching, ch. 57 (trans. Stephen Mitchell):

“If you want to be a great leader,
you must learn to follow the Tao.
Stop trying to control.
Let go of fixed plans and concepts,
and the world will govern itself.

The more prohibitions you have,
the less virtuous people will be.
The more weapons you have,
the less secure people will be.
The more subsidies you have,
the less self-reliant people will be.

Therefore the Master says:
I let go of the law,
and people become honest.
I let go of economics,
and people become prosperous.
I let go of religion,
and people become serene.
I let go of all desire for the common good,
and the good becomes common as grass.”

David C May 22, 2008 at 10:31 am

Not having read the book, I have only the review to go by. Reading between the lines of Mr Gordon’s observations, seems to me the central failing of the authors is this:

Granted, people make mistakes when making choices. Granted, they work on incomplete information. Granted, people often regret decisions they made in the heat of passion, when their blood has cooled and their neocortex evaluates the results more , er, rationally. So, granted, people sometimes choose ‘other than what they REALLY want’. All of these things have been abundantly demonstrated by , um, evonomic studies, both behavioural, and neurological, and even anthropological.

But the point they are missing is that, outside of the individual decisionmaker (any person making any choice at all, however ‘irrational’ it might appear to anyone else, or even to the same individual at another time), there is nobody else with sufficient knowledge or qualifications, to say nothing of the RIGHT ( dammit!), to presume to ‘nudge’ him or her in any direction at all!

Nobody has insight into anyone else’s degree of time preference, say ( the tradeoff between immediate gratification of appetites today vs the deferring that desire in the expectation of a better tomorrow.
Nobody has any insight into anybody else’s preference for balancing risk relative to benefit for any course of action at all.

The libertarian prescription is based on the fundamental acceptance that no individual can impose these preferences and decision-evaluation parameters on anyone else.

The only option for any do-gooder in a libertarian context, is to inform people, through advocacy, giving them information they perhaps did not have before about potential risks or benefits attaching to various options, in the hope that they will use the new information to more completely evaluate their next choice. But you (ie the putative nudger) can never presume to know what any other individual ‘REALLY’ wants.

Besides, if you are assuming he doesn’t know himself, how is it even possible that you could?

this reminds me of a book recently published called ‘Predictable irrationality’ by behavioural economist Dan something-or- other *(surname escapes me right now) from MIT, which suffers from precisely the same failing. And some of his prescriptions (based on his studies of the anomalous workings of th ehuman brain when making choices under different conditions) are truly bizarre, and jaw-droppingly presumptious in a chillingly totalitarian statist way: way beyond ‘nudging’. And the saddest thing about it is that he is just so earnestly well-meaning about it!

David C May 23, 2008 at 4:38 am

Deacon said:


It is not PATERNALISM, folks, but MATERNALISM.

Response: quite.

In the words of Michael Bywater: ‘Its not a handbasket, but a pram’.

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