Friday, 2 December 2011

Lies, Damn Lies and Politicians

One of the sights in politics that makes me doubt whether democracy is really the best form of government is the sight of a politician saying something that isn't true. It happens often and it happens from all parties. But it's not the fact that it's not true that bothers me so much as the fact that the people listening, the people who vote for this politician, can't see that it's not true.

So when a politician announces that their brand new drug policy is to impose longer minimum sentences, reject the notion of harm minimisation and clamp down even harder on the druggy scum that are ruining our beautiful country, and that these will be the first steps towards winning the War on Drugs, it makes me want to punch someone. All the evidence (which I won't repeat here) clearly shows that this is nonsense however, fuelled by newspapers that repeat these lies, the facts are ignored and the problem gets worse. Yet the voters applaud the move and keep voting for him or her.

Why? Because of a failure of public choice. Voters suffer from rational ignorance. An individual vote is worth so little, the world is so complicated and politicians are so adept at spinning that the time input required from any individual voter to properly understand the issues is far greater than the benefit than any individual will get from choosing to vote for someone who will actually look out for them. There is simply no point in any individual being knowledgeable because it makes no difference on an individual basis whether they are. So people vote from a position of gross ignorance for what sounds good  rather than what will genuinely benefit them. This allows for small well-funded lobbying groups to pressure the government to do what benefits them, even when this is harmful to the wider population. The politicians do what they are asked because it benefits them and they are safe in because the average voter won't even notice, much less care.

Of course, the big issue of the day isn't drugs any more. It's the economy, stupid. This is where things become even more challenging because, unlike drug policy, economic policy is harder to understand. Because of this it has become perfectly possible for politicians to state that a particular economic policy will do "x" despite the fact that it will actually do "y". That might be because the politician simply got it wrong or it might be because the politician really wants to do "y" for ideological reasons or to keep the groups lobbying him happy but is aware that he won't win the election if he says so. So he simply claims that the policy will do the politically acceptable thing, whether or not it actually will. The public can't see through it because they don't understand it. The lobbying groups get to have their way and nobody calls them on it.

For those of us who would rather not operate from a position of gross ignorance, this leaves us with a problem. How do we tell if the politician is telling the truth or if he's wrong or if he's lying? Despite having a small amount of economic knowledge I am anything but an economist. Thankfully, there are lots of other people, economists, journalists and commentators, who are perfectly willing to tell us what they think in simple understandable ways. The difficulty, of course, is that they regularly contradict each other so it might seems we're back where we started.

However, while I am not an economist, I am the proud possessor of a law degree and a huge part of the learning process involved in that was developing the ability to assess competing arguments on new topics and form an opinion. If you can't do this, then you've got no business being anywhere near a law textbook. So how can I use this to assess the relative merits of the economic arguments I mentioned above? Hold that thought for a minute because we have to address another issue first.

The point was made to me recently that macroeconomics is such a woolly "science", with no real testable principles, that making any kind of claim as to the future impact of an economic policy is pointless. We just can't know what will happen so any assertion or opinion is meaningless. The implication was that only deluded idiots put any stock in macroeconomic predictions so we may as well just shut up and hold on for the ride.

Leaving aside the fact that millions of economists would reject the notion that macroeconomics wasn't founded in reality, there is a basic and fundamental error in this assumption. The error is this: we may not know for sure what a particular economic policy will do but we DO know that it WILL do something. The logical extension of the argument made to me was that, because we cannot say for sure what this policy is, it doesn't matter what we do. This is clearly absurd. If you accept that principle then we may as well go back onto the Gold Standard, exempt anyone on an income of over £50,000 from any tax whatsoever and invade Poland. "Hey, we don't know what will happen, so who cares?".

It does matter what we do. One option WILL be better than the other, even if we can't say with certainty what that is. All we can do is make our best guess, which neatly brings me back to my earlier point. How can I, as a non-economist, decide which economic policy I think is best? Remember, I HAVE to decide because, come the next election, I'm going to be faced with choosing between two political parties offering competing economic policies. If I can't tell them apart and just vote for the one with the shiniest forehead, I may as well move to Burma for all the good my vote will do.

Now the obvious way to tell these arguments apart, as good historian will tell you, is to look at the motive. Why is person saying one thing and someone is saying something else? We can safely discount the politicians themselves - they don't care if they're right, all they care about is convincing me that they're right. And we can safely discount a large section of the media. For example, the business editor of the Daily Telegraph, a right-wing Conservative supporting publication can safely be ignored. If he said anything that was contrary to Conservative policy or advocated a policy that would benefit poorer people over the wealthy he'd be sacked on the spot. And we can safely discount the advice of financial professionals, City workers and hedge fund managers. None of them are going to advocate anything other than what benefits them personally.

So we have to look further. Look at independent publications that attempt to present balanced viewpoints or have a history of presenting competing views. Look at foreign publications. Look at reports from the Office of Budgetary Responsibility. Look at economics blogs. Try and understand the issue from a balanced perspective. Assess the quality of a source, understand the topic and then form an opinion. For what it's worth, I've done this and have formed the opinion that this current government is dragging us to hell in a handbasket to keep their wealthy backers happy and to push through ideological cuts. I'm certainly not alone in this opinion but, that said, someone else may reach a different opinion. What matters though isn't the final outcome - it's the process. If you're not engaging with the subject and forming an opinion then whatever you think is nothing more than a guess and about as useful as Michael Gove.

Being widely read is the only solution to ignorance and encouraging this in the wider population is the only way we will ever be equipped to move away from this failure of public choice towards selecting representatives that genuinely do have our best interests at heart. We may not know all the answers to the questions we have on drugs, economics or anything else for that matter. but accepting the notion that we mustn't try to answer these questions because they are too complicated for the non-expert to understand and we can't be sure whether we are right anyway? This would be calamitous for all of us.