Principle over Utility … but Both would be Better

“What is your ‘fair share’ of what someone else has worked for?” – Thomas Sowell

I’ve received a number of comments recently (most not all directly to the blog) arguing against some of my positions based on utility. For instance, some have pushed back against my recent discussion of the minimum wage (“If You Can’t Work Well, You Can’t Work At All“) with the somewhat standard contention from supporters of minimum wage hikes that “there is little evidence to support the idea that the minimum wage actually causes bad things to happen.” Several quick points on this before I get to my main point. First, testing a hypothesis in the realm of economics is less clean than it is in physics or chemistry. It’s very difficult to get a control group, and it’s very difficult to demonstrate a result in the absence of “extenuating circumstances” – which are often enough for true believers in a theory to dismiss the clear evidence that they are wrong. Second, to the extent that evidence does exist (and it does), Thomas Sowell (an economist) does a better job than I of pulling through and unpacking it here: Minimum Wage Escalation. (I certainly suggest reading Sowell’s paper – it’s not that long and very well written. The general result is this: research does demonstrate the negative effects of minimum wage; and arguments that it won’t exist rest on easily disproven assumptions.)

I make these quick points before noting that neither of them is a reason why I oppose the minimum wage. I oppose the minimum wage (and so many other government policies) based on principle, not utility. And what are those principles?

I believe in human equality – equality before God. This means that no one of us can claim to be more valuable (in the eyes of God) than another. Your life is as important as mine and vice versa. When I presume to rule over your life by force, outside the bounds of my legitimate authority, then I am a living affront to the God who created us both. I am injecting myself in between you and God as an intermediate ruler – a position He has not granted me. (Unless, of course, you happen to be my child … but I doubt any of them are reading this.)

I believe in the Golden Rule, which is a great description of equality. (“the best way to make a decision is to assume that you’re the other guy, because he’s just as important as you are.”) In a democracy, human equality and the Golden Rule lead one invariably to freedom, voluntaryism, and perhaps libertarianism (I use the term loosely here, as libertarians tend to get some odd views lumped under one heading). For me to demand, by fiat, by force of majority rule, that you behave in a certain way is for me to presume myself your ruler, your superior. This is an assault against equality and the Golden Rule.

I don’t actually require that these principles be shown to have the most utility, at least not utility in the here and now. I believe in eternal judgement. I believe we will stand before God and answer for the lives we have lived. So, for me, one could argue that living in accordance with the Word of God does have the most utility. But this isn’t what most mean when they discuss government policy choices.

Let me offer an example I’ve used before. In various times and places we’ve seen researchers demonstrate the clear correlation between women’s suffrage and the welfare state (consider here). Now, correlation is not causality, but the causal narrative put forward is a simple one (don’t take this as an endorsement, by the way). Women tend (and “tend” is important here) to be more compassionate and emotive while men tend to be more logical. Thus, women tend to vote to “help” people – the welfare state. Again, I’m not endorsing that narrative or the causal relationship, but the correlation is certainly there. One might expect that since I find the welfare state to be inefficient and wasteful (and immoral) I would oppose women’s suffrage. But I don’t. I hold principle above utility.

The same is true in the case of the minimum wage, or the welfare state, or central banking. I hold the principles of equality and the Golden Rule as higher than the utilitarian arguments for (or against) any of these institutions. I happen to also believe that these institutions provide negative utility to the people.

It’s nice when that works out. It’s nice when principles and utility go together (and they hopefully will in a majority of cases). But principle should drive policy preferences. As soon as utility is the only measure that matters we open ourselves up to all manner of evil for the sake of the greater good. [Reductio ad Hitlerium alert!] Heck, even Hitler made “greater good” arguments for exterminating the Jews (but whose good?).

On a hopefully more even-keeled note, greater good arguments are often subject to the interpretations and belief systems of the progenitors. As Sowell notes in his paper, Department of Labor reports continually show no damage caused by minimum wage increases – and ex Department of Labor employees continually describe the intense pressure to shade analysis in the direction of the bureau’s goals. I suspect the same is true for supporters (or opposers) of the welfare state, or minimum wage, or central banking. Finding a way to make the data sound like they support your conclusions has become an art.

Note here that I don’t oppose research into any and all of these issues. By all means, the more we know the better. But when the outcomes essentially revert to “you’d all be better off if you weren’t free” I think we should take a long pause for reflection before slapping on the shackles for the greater good … and perhaps we should even make a run for it. The truth is often so much simpler.

With what shall I come before the Lord
    and bow down before the exalted God?
Shall I come before him with burnt offerings,
    with calves a year old?
Will the Lord be pleased with thousands of rams,
    with ten thousand rivers of olive oil?
Shall I offer my firstborn for my transgression,
    the fruit of my body for the sin of my soul?
He has shown you, O mortal, what is good.
    And what does the Lord require of you?
To act justly and to love mercy
    and to walk humbly with your God. – Micah 6:6-8

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6 Responses to Principle over Utility … but Both would be Better

  1. “Second, to the extent that evidence does exist (and it does), Thomas Sowell (an economist) does a better job than I of pulling through and unpacking it here: Minimum Wage Escalation. (I certainly suggest reading Sowell’s paper – it’s not that long and very well written. The general result is this: research does demonstrate the negative effects of minimum wage; and arguments that it won’t exist rest on easily disproven assumptions.)”

    I find it difficult to afford Sowell much credibility at all– if you are looking to convince the scientific mind, you went to the wrong well. (And I generally agree with you on this issue, with some qualifications/caveats.) Sowell reads like an ideologue, and every single one of his cited papers has a date no later than 1977! He makes a fair point about the need to distinguish results from the Dept. of Labor from those of “independent (usually academic) economists.” Yet he neglects to actually mention any such independent results that conflict with his thesis, of which there are several compelling examples.

    There is an interesting interview with David Card here, that mentions his work with Alan Krueger (their paper is short, their book is not). I think it’s interesting because it’s dispassionate, discussing his ideas about how this issue might actually be messier than Sowell’s high-school-economics-class arguments suggest, but also how their experimental results have been misused/misinterpreted by advocates of both sides of the debate.

    Which is where I have to part company with argument or belief based on principle. Because such arguments/beliefs are irrefutable. By definition, they cannot be changed or swayed. Before discussion even begins, there is no opportunity to convince the holder that they might, in fact, be wrong. At that point, science has stopped, and religion has begun.

    • Allen says:

      So would you contest that you fall into the category of the company you would disperse from, based on the conclusion of your last paragraph? It would seem that a preconceived notion carries the weight of your belief, as well. But alas, I could not change or sway you otherwise, as you seem to strongly believe in this principle.

      • Yes… at least, I think so, if I understand your question and comment correctly, but I am not sure that I do. (I don’t think “disperse” means what you think it means.) You seem to suggest that I am a pot calling a kettle black, so to speak, by having a “preconceived notion” that I am unwilling to change. I’m not sure what that preconceived notion is; can you elaborate?

    • nomasir says:

      Yes, Sowell IS an ideologue (but that doesn’t mean he’s wrong).

      As to: “if you are looking to convince the scientific mind, you went to the wrong well” I will respond with (a) it is difficult to convince the scientific mind of any hard (“solid” not “difficult”) theories in the mishmash of social sciences with very little in the way of effective controls and (b) even if it were there is a difference between “good” and “optimal” – at least until we agree on a loss function.

      I think the last point actually starts to get to your last statement “At that point, science has stopped, and religion has begun.” Well, you have something – and I will offer that “religion” is more than theism but a holding to a principle as above debate. (“That can’t be right, it violates the religious text laid down by [insert prior theorist of some sort]”) Where I will make slight distinction (and it is slight) is between debate over application and loss function.

      My loss function revolves around human equality, human dignity, the right of man to own his own life (and the clear decision of God to allow each man his own life and his own freedom). It is not in general efficiency, or productivity, or aggregate happiness (regardless of geometric or arithmetic mean considerations) – though those issues are not meaningless. There is little need to debate whether plan A or plan B is “better” when we define “better” differently, but there is every reason to debate the definition of “better” and the outcomes of plans A and B if we defined “better” the same. It is the utility function that is based in my religious beliefs – but I am more than open to consideration of the optimization against that function (and, more than open to debate of the function itself … but this usually entails a debate amongst the believers). Of course, the function itself greatly constrains the “feasible region” of government policy. In some sense it makes my job too easy (“all of these programs are outside the feasible region – they violate the Golden Rule” … it probably gets old).

  2. Allen says:

    “Yes… at least, I think so, if I understand your question and comment correctly, but I am not sure that I do. (I don’t think “disperse” means what you think it means.) You seem to suggest that I am a pot calling a kettle black, so to speak, by having a “preconceived notion” that I am unwilling to change. I’m not sure what that preconceived notion is; can you elaborate?”

    Disperse means: “to separate and move apart in different directions without order or regularity; become scattered: The crowd dispersed.” So, if you refuse to sit down and speak to someone who has a belief based on principle with the preconceived notion that they are unmovable and therefore incapable of reasoning, you would remove yourself. Overall, you have dispersed from this demographic under these beliefs that you hold.

    I actually never suggested anything of the sort and I’m sorry you took it that way. I was merely making the argument that self-refuting statements are illogical.

    • I see what you are saying, and I think this is an important point worth clarifying. “Part company” was a poor choice of words on my part; I do not mean to suggest that “someone who has a belief based on principle” is “incapable of reasoning,” or that I would physically remove myself from conversation with that person.

      I *do*, however, maintain that any debate with such a person is inherently asymmetric, and thus of limited usefulness, in the following sense: there is a possibility that he or she may present evidence and arguments that can cause me to change my mind. I must always entertain the possibility that I am wrong. Sure, I have opinions, and a certain understanding of scientific consensus about our world based on the weight of evidence from observation and experiment. But there is always a chance that new evidence, better insight, etc., will demand that I change my perspective.

      The converse, however, is not true. If a person’s beliefs are based on principle, as opposed to logic, or the weight of evidence from observation, then how can those beliefs ever change? And if they cannot change, then argument generates only heat, not light.

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