As a political aside, the recently enacted Pension Protection Act of 2006 specifically authorizes employers to switch from opt-in to opt-out 401(k) enrollment.
This is about as de minimis an example of paternalism as one can conceive. By contrast, mandatory 401(k) participation, without an opt-out, would be a far more disconcerting development.
Don
· 3 years ago
This is Orwellian. It's not control over our lives or nannying, it's "assymetric paternalism." It's not taking away your liberty, it's "keep[ing] subcortical structures in check." Bring on the war with Eastasia.
Of course, one could also point out that the primary flaw in Cassidy's article is that he presupposes that "emotional responses" are necessarily irrational.
Given that reason is the use of one's personal value system to choose between competing options, it seems hard to believe that "emotional responses" can be unreasonable in any sense of the word. Am I irrational simply because I choose a different option than another person does? Of course not. It simply reflects the fact that I have a different value system than that other person.
In reality, it appears that Cassidy simply dislikes the choices that some people make, and perhaps even the values they use to make the choices. Indeed, it is quite telling that he does not seem to broach the issue of how we are to determine if a market outcome is "ideal" in the first place. Perhaps only well-to-do, politically connected economists are capable of making such a determination.
Mcwop
· 3 years ago
Cassidy writes:
"Because the plans are often optional, many people fail to join them"
Some do fail to join, but the majority with access join voluntarily (the glass is more than half full). Regarding automatic opt-in as being paternalistic, I somewhat agree. However, under those opt-in scenarios people maintain the freedom to opt-out unlike say social security.
kurt
· 3 years ago
"If emotional responses often trump reason,there can be no presumption that people act in their own best interest. And if markets reflect the decisions that people make when their limbic structures are particularly active, there is little reason to suppose that market outcomes can’t be improved upon."
Right, now one just needs an oracle machine that tells the the bureaucrats when people's limbic structures become 'unsoundly' active, so that they can 'improve' upon people's actions. Of course, being attached to such an oracle machine in itself might be enough to set of people's limbic structures.
Karl
· 3 years ago
The idea that humans don't always act in their own self interest should not be controversial or even interesting. The real insidious effect of soft paternalism is that it hinders incentives for technological and organizational improvement.
Computer viruses have been causing computer damage for years. I would guess that few people ever regularly updated their anti-virus software eventhough very important personal documents and records were at stake. But the market responded. AV software makers automated Internet updates and Microsoft, too, made security of their OS a top priority. These software improvements have greatly improved overall productivity even for the few who used to be diligent in protecting their computers.
Ultimately, when we wake up sober with a wicked hangover and our rationality returned, we make plans never, ever to get drunk again. Eventually, we learn our limits, and I would rather not have some interfering soft paternalist tell me what my limit is.
M. Smith
· 3 years ago
Soft paternalism is offensive on a number of levels, including the presumptions that emotional decisions are necessarily irrational, the measurement of irrationality is best done by others, and in the aggregate there is some kind of statistically significant pattern of irrationality that can be corrected for collective benefit. But imagine also the unintended consequences of the resulting moral hazards. If the goal is to increase personal discipline/rationality as measured by others, the aggregated response will almost certainly be increased irrationality elsewhere as yet one more aspect of personal responsibility is gutted. You just have to marvel at the unending creativity of those determined to intellectually justify central planning and the absolute inability to imagine policy knock-on effects. That's MY limbic limbo for the day....
All Comments
As a political aside, the recently enacted Pension Protection Act of 2006 specifically authorizes employers to switch from opt-in to opt-out 401(k) enrollment.
This is about as de minimis an example of paternalism as one can conceive. By contrast, mandatory 401(k) participation, without an opt-out, would be a far more disconcerting development.
This is Orwellian. It's not control over our lives or nannying, it's "assymetric paternalism." It's not taking away your liberty, it's "keep[ing] subcortical structures in check." Bring on the war with Eastasia.
I think the Onion tackled this topic years ago...
http://www.theonion.com/content/node/39045</p>
Of course, one could also point out that the primary flaw in Cassidy's article is that he presupposes that "emotional responses" are necessarily irrational.
Given that reason is the use of one's personal value system to choose between competing options, it seems hard to believe that "emotional responses" can be unreasonable in any sense of the word. Am I irrational simply because I choose a different option than another person does? Of course not. It simply reflects the fact that I have a different value system than that other person.
In reality, it appears that Cassidy simply dislikes the choices that some people make, and perhaps even the values they use to make the choices. Indeed, it is quite telling that he does not seem to broach the issue of how we are to determine if a market outcome is "ideal" in the first place. Perhaps only well-to-do, politically connected economists are capable of making such a determination.
Cassidy writes:
"Because the plans are often optional, many people fail to join them"
Some do fail to join, but the majority with access join voluntarily (the glass is more than half full). Regarding automatic opt-in as being paternalistic, I somewhat agree. However, under those opt-in scenarios people maintain the freedom to opt-out unlike say social security.
"If emotional responses often trump reason,there can be no presumption that people act in their own best interest. And if markets reflect the decisions that people make when their limbic structures are particularly active, there is little reason to suppose that market outcomes can’t be improved upon."
Right, now one just needs an oracle machine that tells the the bureaucrats when people's limbic structures become 'unsoundly' active, so that they can 'improve' upon people's actions. Of course, being attached to such an oracle machine in itself might be enough to set of people's limbic structures.
The idea that humans don't always act in their own self interest should not be controversial or even interesting. The real insidious effect of soft paternalism is that it hinders incentives for technological and organizational improvement.
Computer viruses have been causing computer damage for years. I would guess that few people ever regularly updated their anti-virus software eventhough very important personal documents and records were at stake. But the market responded. AV software makers automated Internet updates and Microsoft, too, made security of their OS a top priority. These software improvements have greatly improved overall productivity even for the few who used to be diligent in protecting their computers.
Ultimately, when we wake up sober with a wicked hangover and our rationality returned, we make plans never, ever to get drunk again. Eventually, we learn our limits, and I would rather not have some interfering soft paternalist tell me what my limit is.
Soft paternalism is offensive on a number of levels, including the presumptions that emotional decisions are necessarily irrational, the measurement of irrationality is best done by others, and in the aggregate there is some kind of statistically significant pattern of irrationality that can be corrected for collective benefit. But imagine also the unintended consequences of the resulting moral hazards. If the goal is to increase personal discipline/rationality as measured by others, the aggregated response will almost certainly be increased irrationality elsewhere as yet one more aspect of personal responsibility is gutted. You just have to marvel at the unending creativity of those determined to intellectually justify central planning and the absolute inability to imagine policy knock-on effects. That's MY limbic limbo for the day....