Tuesday, October 21, 2008

Some thoughts on Democracy: Ethicality vs Effectiveness

Western cultures love democracy. You can tell that by the sheer number of US TV shows that involve voting:
  • American Idol? Let's vote!
  • American's Got Talent? Let's vote!
  • American Inventor? Let's vote!
  • Last Comic Standing? Let's vote!
And of course, we got to vote to decide who's going to be our president.

Why do we like democracy? One big reason is that it's fair. Thomas Jefferson wrote that "all men are created equal" in the Declaration of Independence. So, isn't it perfectly ethical that everyone should have his/her voice heard when it comes to deciding who's going to lead the country?

Yes, it's ethical, it's fair, it's politically very correct.

The sad thing is, ethicality doesn't necessarily lead to effectiveness.

"No, let me give you one counter example that fairness leads to effectiveness. The woman who won the Last Comic Standing was actually the funniest among all the other comics and she won because she got the most votes from the audience!"

Well, let me tell you: the reason we arrived at a good decision of the Last Comic Standing show was that people in general have the ability to decide, duh, who makes them laugh. It has nothing to do with whether the system is fair or not.

Now let me ask you

"The policies that Obama/McCain propose, do you think that they will be effective? If you do, why?"

I remember seeing a presidential debate between Obama and Clinton. The moderator asked Obama why he wanted to raise capital gain tax because, historically, raising tax rate doesn't necessarily increase tax income for the government. I forgot how Obama responded exactly but he implied that it is the right thing to do. Or, ethical, fair, politically correct, choose one you like.

In Freakonomics, Levitt claimed that the sudden crime rate drop in the US during the 90's was due to the legalization of abortion in the 70's. I know there's a good deal of people who don't agree with his theory and I don't have time to read about all the technical details of their analysis. However, one thing I'm pretty sure is that Levitt's theory cannot be completely wrong.

If it's not completely wrong, we've just witnessed a case in which ethnically questionable behavior (abortion) can lead to good outcome for society (crime rate drop).

The more I read about economics, the more I believe that it's very difficult to decide whether a government policy is actually beneficial to the country. A policy that sounds so good to you may well be a disaster to the economy as a whole in the long run.

Realizing it actually irritates me when the presidential candidates say something like

"We'll make health care accessible to the poor."

"We believe that everyone should get a job that pays living wage."

"We'll be energy independent."

How can you make huge promises like these? How do you know that the polices you're proposing will actually work and not harm other parts of the economy at the same time? Do you know that we don't have infinite resources to make everything wonderful?

Maybe, maybe a citizen can decide whether your polices are good if s/he
  • has a deep understanding of various economics theories
  • has good mathematical and analytic skills
  • will actually read through all the words in your policies and understand them
Do you think an average citizen has/will do the above? Tell you what, I really like reading but I still feel tired if I need to read through a long article like this one to understand the cons of the abortion-drops-crime-rate theory. Mind you, it's just one theory/policy on one potential cause. A candidate proposes many policies that affect numerous aspects of the country. No exaggerating, one probably needs to read thousands of pages just to have a grasp of what really is going on.

No, an average citizen won't/doesn't have the ability to do that. Because of this, I don't think an average citizen would make a good decision on choosing the right candidate. And, a lot of average citizens making decisions with no rational ground will just result in one final average, or, bad, decision.

That's why I think that, as good as democracy sounds, it is seriously handicapped in leading to effective decisions on complex issues such as, yup, choosing the right person as the president of a country.

If highly educated citizens in a developed country like the US may not make good decisions on choosing a good leader, how hot an idea can it be for a developing country like China with many illiterate citizens to practice democracy? I really, really doubt it.

What do I want to say in this post?
  • Be a critical thinker; ideas that sound that they work doesn't mean that they'll actually work
  • Be non-religious when situation warrants it; actions that are ethical doesn't mean that they'll lead to good outcomes
Thanks for reading :)


  1. Mansfield11:41 PM

    Haha, I have the contrary thinking.

    The more I study economics the more I realized that ethic should and must come to the first consideration. If it is ethical to do so, and if ethic implies that we must do so; even if such a policy implies a lost and some bad to another group.

    what an economist jobs is to identified the potential harm and minimize the harm. Humanbeing are more complex than the simple, non-ethic, rational(here, I use the notion define by economics, instead the one that is define by philosophy or other displine) that we, economist, assume. Our models can just gives us an approximation on what the policy effect will be. And the worst is that if we set up our constraint and conditions of the model differently we will get different result. It all depends on how you set up the question!

    Rule number one is therefore, always stick to ethics. If ethics implies doing so is right, then do it. the economist should focus to minimize the lost of the special interest group. What we really want is that the end result to be socially desirable.

  2. Mansfield: I'm trying to understand your arguments of why we should always do what is ethically correct.

    From your second paragraph, it seems that your argument is that economics is limited and can't really predict what a certain policy's effect is. For the most parts, I agree with this claim. If economics theories predict very well, we could have avoided many bad policies. So, it'll be a matter of *how* accurate economic theories are in certain circumstances.

    My main points in the post assume that economic theories are accurate to a certain extent. Given this assumption, if a certain policy is ethical but bad to society according to economic theories, we should not practice it.

    In other words, I'm not against practicing ethical policies but concerned about the effect. If it's ethical and bring good results, do it. If it's ethical but bring bad results, don't do it.

  3. Mansfield12:10 AM


    I am sorry about my terrible english. I hope I can improve it this time.

    May I ask you a question to begin. will you consider paying an assagsin to murder someone ethically correct? I don't, honestly, but if we run our policy base only on economics theorey such an act will be benefitcial to the market and the society; thus murdering someone by giving enough compensation should be allowed.

    Another example will be trading humanbeing organs , economics theorey say that as long as trade is allowed the market will reach its best efficientcy, thus the the society as whole will benefit. So, if we design our policy simply on economics reasoning/theories, we will always ends up with selling and buying human lives. Giving the right price you can always do so. That is why i detest to take economics reasoning to its extreme form and I prefer to use morals or ethics as my constraint when I am thinking about policy.

    The underlying philosphy behind economics is utilitarinism, which states the benefit and happiness and value of a humanbeing can be measured in a standardized unit. now assume such a unit exit, then we can always convert it into money unit. and since everything can measure in money , we can apply cost and benefit anlaysis and trade what ever we like, which also means praticing slavery, trading human organs should be allowed, given that the cost(monetary term) is paid.

    what I want to point out is that you cannot seperate ethics and economics benefit independently. every policy that is made will be praticed to the society, and will eventually produced an impact.

    Such an impact can be positive or negative; it depends solely how the society react. the society can accept the economic policy and cooporate, which generate positive result given that the policy itself is well design. The society can also refuse to cooporate, ( for example, such a policy is unethical and against the will of the society) than the effect of the policy will be negative, even if the policy itself is well designed and economically reasonable.

    (By the way perfect theory only exist in a perfect world, but in a perfect world there is no such a point to create a policy, because it is welfare irrelevant. which also implies that there is no such a need for ethics or economics. Since we are living in an imperfect world perfect policy will never exist and we should be careful on every policy we design and evaluate the benefit and lost careful under different assumptions.)

    We want policy because we are in an imperfect world which implies ethics is there in our society. When we try to design a policy we also need to consider that. A policy that is based on an economic theory which is derived from a pefect world, and ignore the will or moral of the society will generate nothing but disater.

  4. Mansfield: Paul Graham once said that it is easy for readers to read something that the write didn't say, and indeed it is.

    I never said that we should practice policy that is unethical and bring good results. I only said that we should not practice policy that sounds ethical but bring bad results. These two are totally two different things. Do you see the difference?

    That being said, it may not be always wrong to do things that are unethical but bringing good results. This is the topic of another article.

    Considering your first example, it's exactly like how Obama ordered the troops to kill Bin Laden. Some people say that it's right, some say that it's wrong. Indeed, if the existence of Bin Laden means more threat to the lives of innocent Americans, I think what Obama did is right.

    Responding to your point of a policy that is economically reasonable but elicit bad reaction from the people because it sounds unethical, that'd be an issue the marketer of the policy (like the President) has to solve. If there's no way to market it right, the policy itself isn't bringing good results after all so it shouldn't be practiced.

    As you said, pure economics theories based on mathematics will predict correctly 100% of the time in a perfect world. Nevertheless, it doesn't mean that they have no value in an imperfect world. In an imperfect world, it'll predict less accurately. If it predicts wrong more than 50% of the time, of course we should dump it. Theories in Physics aren't absolutely accurate either but they're valuable because they help us approximate causes and effects of the physical world.

    Lastly, I want to claim again that I'm not against ethics (I said that in my previous comment). I'm talking about one extreme (rejecting a policy solely because it sounds unethical) and you're talking about another (practicing policies that ignore ethics altogether). Both extremes are bad.

  5. Mansfield1:56 AM

    perhaps this clip and express my idea in a better way.

  6. Mansfield: Thanks for sharing the video. Will watch it when I've time. Too busy lately.

    Also, thank you for spending the time to comment on my article. It's good to know that someone cares about topics like this.


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