All Commentary
Wednesday, February 24, 2010

Fantasy Is Not an Adult Policy Option

The Freeman, quite understandably, has an editorial focus on the advocacy of libertarian solutions to economic and social problems. In this article, however, I wish to enter a plea for adult solutions to such problems, a plea that transcends any left/right or statist/libertarian dichotomies. As I hope to persuade readers—or any serious advocates of any policy stance whatsoever—so long as they are interested in real discussion and intelligent engagement with their opponents, they should eschew pleasant fantasies. Instead, they should focus on the options realistically on the table.

Although the ideas I present here were simmering on a back burner of my mind for some time, they were moved to a front burner due to some sloganeering I recently encountered several times on Facebook. Those of you who are members of that social networking site also may have seen the status message that read, “[John Doe] thinks that no one should die because they cannot afford health care, and no one should go broke because they get sick.” (One reasonably can surmise that this is meant to be an argument for the health care legislation being pushed by prominent Democratic politicians.)

Well, I posted as my status a Star Wars-based parody of that message (which I did not originate) that said, “No one should be frozen in carbonite, or be slowly digested for a thousand years in the bowels of a sarlaac, just because they couldn’t pay Jabba the Hut what they owe him.”

In response, some of my Facebook friends got mad at me, contending that I was scoffing at the political pursuit of worthwhile goals. But actually I was scoffing at adopting childish fantasizing as a replacement for a serious discussion of policy alternatives. Yes, it would be lovely if no one ever died because of a lack of health care funds, and, in fact, if no one ever got sick at all, and if our burps smelled like lavender flowers.

But no matter what policies we implement, none of these things are going to happen. In this particular case people, under any organization of medical care, will die due to a lack of funds, because we do not live in a world of infinite resources. True, if medicine were fully socialized, and treatment were always “free,” no one would die due to a lack of funds on his or her own part—instead, people would die due to lack of government funds.

Any State running a socialized medical system has to stop spending at some point—for instance, it can’t come anywhere near spending 100 percent of GDP on medical care, because then there would be massive deaths due to starvation! And it will always be the case that if the government in question only had spent more than it in fact did spend, some people would have lived longer.

A serious discussion of this issue should approach the topic as adults would, recognizing that we live in a world of scarcity in which, as a result, we cannot avoid making tradeoffs. Some people will die who might have been kept alive a bit longer by devoting more resources to their care, no matter what we do. Having recognized that, now we can begin to discuss what policy will result in minimizing those deaths, or distributing them better, or whatever other goals we have. Clearly, libertarians will tend to believe that a free market in health care would provide the best possible solution to this problem of scarcity, but the point I’m attempting to make here is not tied to that answer. An interventionist who thinks that market failure pervades the health care industry may see a need for a government program to address such failures, but, nevertheless, she will, if she’s being serious about the issue, realize that her proposed solution will not be a panacea and will still involve tradeoffs. (And such realistic interventionists do, indeed, exist—see Robert Reich discussing just such tradeoffs)

Not a Partisan Issue

And lest anyone still think I’m being partisan here, I will note that the temptation to substitute fantasizing for serious political thought afflicts both major political parties to a similar degree. For example, some on the right have declared that the United States is engaged in a “war to end terror,” but that is not an adult policy goal; an adult recognizes that terrorism will occur, and asks how to minimize it. Now one such adult’s answer may still be different from another’s: One person may decide that, even though some acts of terrorism are inevitable in our less-than-perfect world, it is still the best option for the Untied States to do what it can to spread democracy in the Muslim world, while recognizing that such a project will inevitably produce some “blowback.” Another may conclude that leaving Muslims alone to work out their own problems is a better solution, even though it will inevitably leave some terrorists free to operate—terrorists whom a more active policy may have been able to thwart. However, whatever policy mature consideration ultimately decides on, it should be recognized that proposals such as those put forward in a 2003 book by two prominent neoconservatives and Bush advisers, David Frum and Richard Perle, promising “an end to evil” itself, are an exercise in childish fantasizing and not in serious political thinking.

Similarly, a “drug-free America” is not an adult policy goal. An adult realizes that some people will find a way to get high under any legal regime and asks how to best minimize the harm. Once again, it is clear that libertarians probably will opt for widespread drug legalization, citing both the undesirable byproducts of attempts to prohibit voluntary drug consumption (see, for instance, Paul Armentano’s article in The Freeman, December 2009) as well as an individual’s right to choose what drugs he or she should or shouldn’t consume. However, it is likely that conservatives and progressives may not reach a similar conclusion, finding that some combination of partial legalization, mandatory treatment, and/or prohibition is the best solution to the drug problem. Nevertheless, if they are approaching the issue in an adult fashion, they will recognize that their favored solution is very unlikely to produce a “drug-free America,” noting, for instance, that the well-nigh universal prohibitions on murder and theft that have existed for thousands of years have never produced a “murder-free” or “theft-free” society anywhere in all that time.

I will offer one more example of political fantasizing drawn from the left. While riding in a New York City subway train recently, I saw an advertisement advocating that all New York employers be legally required to grant paid sick leave to employees. Once again, the intentions are admirable: It is certainly nice to have some paid sick leave, just as it would be nice if no one ever died due to a lack of medical care, or if terrorism were eliminated from the world. But, after visiting the website of one of the groups sponsoring the advertisement, I was struck by the fact that the site portrays paid-leave legislation as having only positive consequences, as if no tradeoffs need be made. The New York City government could simply declare that every worker has the right to either five or nine paid sick days, depending on the size of the company (please don’t ask me exactly how they arrived at these numbers) and everything else would continue exactly as before.

But in the real world employers decide whether or not to hire a worker, as well as how much to pay him, based on the marginal effect of that hire or that wage rate on the profitability of their businesses. For instance, if the employer works in her firm (as is typical in small businesses), she often has the option of either hiring an extra hand or working a bit more herself. On the margin the extra cost of mandatory paid sick leave will inevitably tip the balance, in at least some cases, toward the owner taking the shifts the potential new hire could have taken. In such cases, the proposed legislation will not have gained the hypothetical employee a job with paid sick leave, but deprived him of that job altogether.

Another decision an employer will face, in any job paying more than the minimum wage, is what salary to pay an employee. It should be obvious that the salary will be lower if the job description includes several paid sick days than it would if it does not. A worker who is young and healthy, and unlikely to be sick very often, may well prefer slightly higher wages to some number of paid absences. That worker will be hurt by the proposed legislation to the extent that her employer must factor into her wage a number of sick days she probably will not use.

Intentions Are Nice, Tradeoffs Are Real

Now, an honest, adult citizen may recognize the presence of such tradeoffs and favor this legislation nonetheless. He might decide it is more important that working parents have the option of staying home to care for a sick child than it is for young single workers to earn a slightly higher wage, and that the benefits to working parents are greater than the costs of the hires that won’t be made as a result of the mandate. But to pretend that such tradeoffs don’t exist is, once again, to substitute fantasy for prudential evaluation of available options.

Having nice intentions and then pushing for some policy aimed at achieving one’s goals—without giving any thought to the likelihood of the policy’s success or the possibility that it will actually worsen the condition one seeks to ameliorate—is, indeed, not only silly but also immoral: It lacks the virtue that classical moral thinkers called prudentia, or the consideration of the actual result an action is likely to bring about and not merely what one wishes it will achieve. On the personal level, people generally understand this principle well enough; a mother who defends having placed her child in a fire because the flames would burn away the evil spirits that caused his bad behavior is unlikely to get much sympathy. But perhaps because social problems are more complex and the consequences of a bad policy not as immediately apparent, we too often are willing to excuse a lack of prudentia based on the lovely aims of the supporter of that policy.

What I suggest here is that, whatever policies one suspects will work best, whether libertarian or otherwise, our political discourse cannot help but be healthier if we commit to examining our options as adults, recognizing that any choice will involve tradeoffs, instead of suggesting that mere fantasizing represents an honest political option.

  • Gene Callahan is a writer and economist who teaches at the State University of New York at Purchase.