By: Amanda Porter
In his precis Jose Galvez Contreas has pulled out several questions and key points related to this week’s theme of the economic paradigm and the rationale for intervention. In this response I will use Joseph Stiglitz’s piece as a frame to dig deeper into Jose’s question of “how we can overcome what the theory indicts and start involving the public in an active manner.” I don’t claim to answer this complex question in a brief precis, but instead I will discuss the problem of a gap between theory and public and government action, using the example of public policy decisions around gun control. Using the pressing problem of gun control, I will discuss why the theory of Pareto improvements does not exist in practice in the United States, utilizing the four theories posited by Stiglitz’s piece: inability of governments to make commitments, coalition forming and bargaining, destructive competition and uncertainty about the consequences of change. (Stiglitz 1998).
On the surface, when considering the issue of gun control reform seems it seems clear cut. It seems maddening that even after some of the deadliest mass shootings in modern history like Sandy Hook Elementary School, the shooting at Fort Hood and most recently, the Pulse Orlando Night Club that politicians wouldn't be ready to stop tempering public opinion with their “thoughts and prayers” and instead start passing concrete legislation around gun control. This issue doesn’t even seem to have the problems related to asymmetric information or expert technical advice; it seems easy for the public to grasp—banning assault rifles (those created for an intended for mass destruction and war) can help to reduce the number of casualties from mass shootings. Those who sell assault weapons or sell weapons to people on FBI terror watch lists may not benefit from the policy decision, but society at large would benefit from a modicum of safety and a decreased chance of being a victim of a mass shooting. Indeed, after each shooting there are outcries from the general public and from government officials to do something about the proliferation of gun violence in the United States, after the Orlando shooting some senators even went beyond the rhetoric of reaction and took action with a sit in. But why has the public allowed this government failure of intervention and not collectively demanded change? Along with a dearth of empirical evidence, there seems to be a general public consensus that gun violence and mass shootings are a problem in the United States. However, once the problem is contextualized in the larger process of public policy making, it becomes clear that a solution that includes stricter gun control which seems to be a near Pareto improvement at first glance, actually involves a complex web of decisions, power dynamics, the politics of money, special interests groups and cultural embeddedness that blocks even the weakest of policies around gun control from being passed.
Stiglitz argues that the inability of governments to make commitments hinders policy that would lead to a near Pareto improvement. The idea is that policies change when administrations or specific political actors change and there can be no guarantee that a policy passed one year will not be overturned in the next. However, Stiglitz also notes that, “Public choice scholars such as James Buchanan (1975, 1991) have argued that the Constitution represents a form of commitment [from the government] since it increases the costs of some policy reversals such as those pertaining to civil rights” (Stiglitz, 1998 pg. 10). Those who argue against gun control on the basis of the second amendment are using this so called “commitment” by the government to keep the status quo. Therefore, in the case of gun control Stiglitz theory about the inability of governments to make commitments is actually turned on its head and the supposed commitment made by the constitution is used as a way to block legislation that could lead to near Pareto improvements.
A second theory put forth by Stiglitz is that government failure to enact Pareto improvements is due to bargaining inefficiency in the public sector (1998, pg. 11). The power dynamics that exist between a special interest group like the NRA (National Rifle Association) and a special interest group committed to passing gun control legislation is unbalanced. The NRA has the power of the purse and uses this chip in bargaining and lobbying with public officials. As Stiglitz points out, decisions made in the short term can “crystallize” the bargaining power of some group and weaken the power of others in coalition building (Stiglitz 1998, pg. 12). This has happened time after time when government chooses inaction with gun control. A related theory argued by Stiglitz is that of destructive competition. In political games, when there is a position to be won or lost (a zero sum game) and competition is imperfect, it is often destructive. Therefore, politicians acting in self-interest—pandering to lobbyist to win re-election—rather than enacting policy that could lead to near Pareto improvements.
Finally, Stiglitz argues that uncertainty about the consequences of change ends up blocking policy that could lead to near Pareto improvements. In this theory, imperfect information hinders bargaining and consensus outcomes that would benefit all actors and instead leads those involved in the bargaining to believe it is a zero sum game. In addition, people lack the training or willingness to understand the consequences of the policies. However, Stiglitz argues that “Policy, as opposed to politics, is not zero sum” (1998, pg 14). In terms of the debate on gun control, people seem to be entrenched in their positions and misguided by partisan rhetoric which blinds them from understanding the true outcomes of policy decisions. Partisan rhetoric and entrenched cultural ideas about the right to bear arms and to defend yourself and your family is used shamelessly by government officials and misinformation about the outcomes of specific gun control policies is spread by the media. For example, if congress passed a law to ban the sale of guns to people who have appeared on watch lists or have ties to terrorist organizations, the vast majority of people who own guns would not be effected (Herszenhorn and Lichtblau 2016). However, in this case those who fight against gun controls are looking at the issue in the long term and not just as a single public policy. Some may view this as a “slippery slope” as one in a long line of policy decisions that will get progressively stricter on gun control, eventually constricting their right to bear arms.
In theory, policy that creates near Pareto improvements should be easily passed and accepted through public action, coalition building, measures taken to the alleviate the effects on the few that don’t benefit and ultimately the public and government would arrive at a sustainable consensus. However, in reality, these problems are rooted in existing power dynamics, self-interested politicians, partisan politics, a divided electorate, historical narratives and other barriers that lead to inaction, non-intervention and ultimately government failure to ensure well-being of its citizens.
SOURCES
Stiglitz, Joseph. 1998. “The Private Uses of Public Interests: Incentives and Institutions.” Journal of Economic Perspectives. 12(2).
Herszenhorn, David and Eric Lichtblau. 2016. “Orlando Shooting Reignites Gun Control Debate in Congress.” The New York Times. http://www.nytimes.com/2016/06/14/us/politics/terrorist-watch-list.html?_r=1
In his precis Jose Galvez Contreas has pulled out several questions and key points related to this week’s theme of the economic paradigm and the rationale for intervention. In this response I will use Joseph Stiglitz’s piece as a frame to dig deeper into Jose’s question of “how we can overcome what the theory indicts and start involving the public in an active manner.” I don’t claim to answer this complex question in a brief precis, but instead I will discuss the problem of a gap between theory and public and government action, using the example of public policy decisions around gun control. Using the pressing problem of gun control, I will discuss why the theory of Pareto improvements does not exist in practice in the United States, utilizing the four theories posited by Stiglitz’s piece: inability of governments to make commitments, coalition forming and bargaining, destructive competition and uncertainty about the consequences of change. (Stiglitz 1998).
On the surface, when considering the issue of gun control reform seems it seems clear cut. It seems maddening that even after some of the deadliest mass shootings in modern history like Sandy Hook Elementary School, the shooting at Fort Hood and most recently, the Pulse Orlando Night Club that politicians wouldn't be ready to stop tempering public opinion with their “thoughts and prayers” and instead start passing concrete legislation around gun control. This issue doesn’t even seem to have the problems related to asymmetric information or expert technical advice; it seems easy for the public to grasp—banning assault rifles (those created for an intended for mass destruction and war) can help to reduce the number of casualties from mass shootings. Those who sell assault weapons or sell weapons to people on FBI terror watch lists may not benefit from the policy decision, but society at large would benefit from a modicum of safety and a decreased chance of being a victim of a mass shooting. Indeed, after each shooting there are outcries from the general public and from government officials to do something about the proliferation of gun violence in the United States, after the Orlando shooting some senators even went beyond the rhetoric of reaction and took action with a sit in. But why has the public allowed this government failure of intervention and not collectively demanded change? Along with a dearth of empirical evidence, there seems to be a general public consensus that gun violence and mass shootings are a problem in the United States. However, once the problem is contextualized in the larger process of public policy making, it becomes clear that a solution that includes stricter gun control which seems to be a near Pareto improvement at first glance, actually involves a complex web of decisions, power dynamics, the politics of money, special interests groups and cultural embeddedness that blocks even the weakest of policies around gun control from being passed.
Stiglitz argues that the inability of governments to make commitments hinders policy that would lead to a near Pareto improvement. The idea is that policies change when administrations or specific political actors change and there can be no guarantee that a policy passed one year will not be overturned in the next. However, Stiglitz also notes that, “Public choice scholars such as James Buchanan (1975, 1991) have argued that the Constitution represents a form of commitment [from the government] since it increases the costs of some policy reversals such as those pertaining to civil rights” (Stiglitz, 1998 pg. 10). Those who argue against gun control on the basis of the second amendment are using this so called “commitment” by the government to keep the status quo. Therefore, in the case of gun control Stiglitz theory about the inability of governments to make commitments is actually turned on its head and the supposed commitment made by the constitution is used as a way to block legislation that could lead to near Pareto improvements.
A second theory put forth by Stiglitz is that government failure to enact Pareto improvements is due to bargaining inefficiency in the public sector (1998, pg. 11). The power dynamics that exist between a special interest group like the NRA (National Rifle Association) and a special interest group committed to passing gun control legislation is unbalanced. The NRA has the power of the purse and uses this chip in bargaining and lobbying with public officials. As Stiglitz points out, decisions made in the short term can “crystallize” the bargaining power of some group and weaken the power of others in coalition building (Stiglitz 1998, pg. 12). This has happened time after time when government chooses inaction with gun control. A related theory argued by Stiglitz is that of destructive competition. In political games, when there is a position to be won or lost (a zero sum game) and competition is imperfect, it is often destructive. Therefore, politicians acting in self-interest—pandering to lobbyist to win re-election—rather than enacting policy that could lead to near Pareto improvements.
Finally, Stiglitz argues that uncertainty about the consequences of change ends up blocking policy that could lead to near Pareto improvements. In this theory, imperfect information hinders bargaining and consensus outcomes that would benefit all actors and instead leads those involved in the bargaining to believe it is a zero sum game. In addition, people lack the training or willingness to understand the consequences of the policies. However, Stiglitz argues that “Policy, as opposed to politics, is not zero sum” (1998, pg 14). In terms of the debate on gun control, people seem to be entrenched in their positions and misguided by partisan rhetoric which blinds them from understanding the true outcomes of policy decisions. Partisan rhetoric and entrenched cultural ideas about the right to bear arms and to defend yourself and your family is used shamelessly by government officials and misinformation about the outcomes of specific gun control policies is spread by the media. For example, if congress passed a law to ban the sale of guns to people who have appeared on watch lists or have ties to terrorist organizations, the vast majority of people who own guns would not be effected (Herszenhorn and Lichtblau 2016). However, in this case those who fight against gun controls are looking at the issue in the long term and not just as a single public policy. Some may view this as a “slippery slope” as one in a long line of policy decisions that will get progressively stricter on gun control, eventually constricting their right to bear arms.
In theory, policy that creates near Pareto improvements should be easily passed and accepted through public action, coalition building, measures taken to the alleviate the effects on the few that don’t benefit and ultimately the public and government would arrive at a sustainable consensus. However, in reality, these problems are rooted in existing power dynamics, self-interested politicians, partisan politics, a divided electorate, historical narratives and other barriers that lead to inaction, non-intervention and ultimately government failure to ensure well-being of its citizens.
SOURCES
Stiglitz, Joseph. 1998. “The Private Uses of Public Interests: Incentives and Institutions.” Journal of Economic Perspectives. 12(2).
Herszenhorn, David and Eric Lichtblau. 2016. “Orlando Shooting Reignites Gun Control Debate in Congress.” The New York Times. http://www.nytimes.com/2016/06/14/us/politics/terrorist-watch-list.html?_r=1