Anemia of the Conscience

ORS § 659A.403:
Discrimination in place of public accommodation prohibited

(1) Except as provided in subsection (2) of this section, all persons within the jurisdiction of this state are entitled to the full and equal accommodations, advantages, facilities and privileges of any place of public accommodation, without any distinction, discrimination or restriction on account of race, color, religion, sex, sexual orientation, national origin, marital status or age if the individual is 18 years of age or older. 

(2) Subsection (1) of this section does not prohibit:
(a) The enforcement of laws governing the consumption of alcoholic beverages by minors and the frequenting by minors of places of public accommodation where alcoholic beverages are served; or (b) The offering of special rates or services to persons 50 years of age or older. 

(3) It is an unlawful practice for any person to deny full and equal accommodations, advantages, facilities and privileges of any place of public accommodation in violation of this section.

Emphasis added. I picked the Oregon public accommodation statute for its recent relevance, but pretty much any state would do. Furthermore, I highlighted "sexual orientation" for the purposes of illustration, but you might imagine that there are edge cases for the other protected classes.

Before I pose my question, a quick review of etymology for those who may have forgotten:

Pederasty is an act. It is the sexual congress of an adult and a minor. In Anglophone jurisdictions, it is malum in se crime, an act of violence against an innocent. Coercion is assumed, with the possible exception of Romeo and Juliet laws where applicable. Conviction of this offense is typically accompanied by registration with the state and subsequent housing location restrictions after prison release.

Pedophilia is an orientation. It is the sexual attraction of an adult towards minors. Without an accompanying act, such as the possession of child pornography or the sexual assault of a minor, it is not a crime.

Pederasts do not constitute a protected class. Felons may be turned down for work simply because they are felons, no other reason given. They do not enjoy non-discrimination protections for equal housing. Sex offender registrees have it even worse (in some jurisdictions): even if a landlord is willing to rent or sell, proximity to schools or churches may statutorily prohibit the transaction.

Pedophiles are part of a protected class, at least in 21 or so states, depending on the specific language of the state statutes. The same goes for—again, according to the black letter of the statute—bigamists, ISIS members, former Nazis, or flatulent televangelists (curiously, veteran status is not listed in the Oregon statute). Running a business statutorily obviates conscience of association in commerce, both for good and for bad.

Exchange is lovely, doubly so if it's euvoluntary. Both parties are better off (or at least no worse off) for conducting a transaction of their own free and clear will. Under public accommodation statutes like the one above, it is sufficient that merely one party to the exchange is better off. Sellers are permitted neither the luxury nor the exercise of their conscience. Usually, most people will happily approve of the proposal that vendors aren't granted the liberty of indulging a rotten conscience: denying same sex (or mixed-race, or Irish, &al) couples access to market goods is a barbarism the silent majority of us have moved beyond. But the price of forcing this conversion with the hammer of the state is that there may remain some conscience violations many of us are not prepared to accept yet.

And so when the local kiddie pervo saunters into the Circle K to pick up a tub of hand lotion and a box of tissues from you, you are legally obliged to complete the transaction. The alternative social institutions is to allow rhetoric and persuasion to change merchants' minds on the sort of clients they're willing to serve. Perhaps rhetoric and persuasion aren't as powerful or swift as we might like.

Type I Phobia

Words have both denotative (rational, dictionary) definitions and connotative (emotional, vernacular) interpretations. So do suffixes. One such suffix that sports a denotative meaning a bit at odds with its connotative evocation is "-phobia."

A phobia is an extreme or irrational fear or aversion. A fear of going outside is a phobia on a calm, temperate day absent political or social unrest. But if there's a tornado warning or a riot happening, that sort of fear is justified—it's not a phobia.

I confess to being a bit of a natural stickler when it comes to medical diagnosis. It's no more cute or endearing to hear, "I check the lock three times whenever I leave the house, I'm so OCD" than it is to hear, "I could barely make it up the stairs this morning, I have such cancer." If you really have OCD, that's awful and debilitating, as it is if you actually have cancer. It seems just to me to either treat them both as sacred or both as profane. I don't see the virtue in discriminating.

But discriminate we do, which is why actual irrational terror of, say, spiders can get lumped in with brown-bag bigotry. Few bigots' distaste for homosexuals or Muslims or immigrants actually qualifies as a clinical condition, one that they need to seek treatment for.

For the most part, bigots don't need medication or extensive counseling. They just need a little humanity in their lives. Do yourself a rhetorical favor and make your language more euvoluntary. Drop the -phobia unless it's genuinely warranted. And if it is, consider helping the person in question find professional help. Phobias can be a dreadful burden.

The Alchemy of Intentions

Reads a sign on the patio of my local grocer's:

Retail Alcoholic Beverages Not To Be Consumed on the Premises 

Naturally, alcohol by-the-glass is quite available. You can have a slice of pizza and some on-tap beer to wash it down with, but if you dare unplug the spigot of that box of Chablis you bought inside, you flaunt the good laws of the Commonwealth.

Statutes against public drunkenness dabble in the gray area between what Hayek referred to as "law" (the spontaneous ordering of society's rules, emerging over time through trial and error) and "legislation" (mandates from a legislature, seldom subjected to the rigorous review of time and experience). Surely there have been the equivalent of drunk tanks for time immemorial—you absolutely must let someone three sheets to the wind sleep it off lest he become a danger to his own person and the safety of those around him. That's not particularly controversial.

However, using common sense, common law proscriptions against public intoxication as justification for treating beer differently if it comes from a tap compared to coming from a bottle smells a little skunky. Does the alcohol content rise during the bottling process? Perhaps my experience with home brewing has misled me, but my before-and-after specific gravity readings have never so indicated. Perhaps it's a monitoring issue. If the customer has to approach the counter every time he wishes to refresh his tasty beverage, the vendor has a chance to gauge whether or not to cut him off: a chance that does not exist if he bought all his liquor beforehand in the grocery store.

This argument is not entirely without merit, so the next question is whether or not the marginal risk-weighted costs of drunk and disorderly conduct for the consumption of retail-purchased alcohol (net of on-tap service) are high enough to justify the direct costs plus all the hidden opportunity costs of having an alcoholic beverage control department.

Perhaps I was out sick the day they issued the philosophers' stone that allows for the transmutation of good intentions into desirable outcomes, but I can't for the life of me divine the alchemy by which the political rents generated by the VA ABC result in cheerful temperance at the Fair Lakes Whole Foods. Instances of drunken buffoonery are everywhere and always a purely local phenomenon. The grocers, not an alcohol control board, know best the specific circumstances of their business and are far better equipped to handle the particular, idiosyncratic desires of their customers than a gang of state employees.

And I don't even drink. Sheesh.

Interlude: Ice-T vs. Adam Smith

An exercise in analytical moral intuition. Please reconcile the following:

1) "As it is the power of exchanging that gives occasion to the division of labour, so the extent of this division must always be limited by the extent of that power, or, in other words, by the extent of the market. When the market is very small, no person can have any encouragement to dedicate himself entirely to one employment, for want of the power to exchange all that surplus part of the produce of his own labour, which is over and above his own consumption, for such parts of the produce of other men’s labour as he has occasion for."

2) "Pimpin' ain't easy"

references
1) Adam Smith, Wealth of Nations Book I ch. 3 (1776)
2) Ice-T album "Rhyme Pays" track titled "Somebody Gotta Do It (Pimpin' Ain't Easy!!!)" (1987)

If there Was a Grand Canyon, She Could Fill it up with the Lies He's Told Her

Following up on Arizona's SB 1062, George Takei writes an open letter to the people of Arizona. In it, he pledges to boycott the entire state.

If your Governor Jan Brewer signs this repugnant bill into law, make no mistake. We will not come. We will not spend. And we will urge everyone we know–from large corporations to small families on vacation–to boycott. Because you don’t deserve our dollars. Not one red cent.

Having studied public choice economics, I'm perhaps over-sensitive to methodological individualism. I have an appreciation for the nature of coalition politics and how it can be that no one's first choice for either policy or representative could (under certain circumstances) end up on the ballot. Indeed, since I understand all this in my bones, I am deeply puzzled by Takei's pledge. It strikes me as a missed opportunity.

As I noted a couple of posts back, the struggle for equality is one waged in the moral sensibilities of the constituency. If I were an avid gay rights champion, I would take this as an opportunity to visit Arizona and reward gay-friendly businesses, perhaps picketing bigoted firms while I was in town.

The thing I find remarkable is that Takei and his family were subjected to Executive Order 9066, one of America's greatest 20th Century moral embarrassments. Roosevelt's WWII internment of Americans with Japanese ancestry assumed guilt by association. Though different in scope and application (especially since it was conducted by force rather than with voluntary withdrawal), the logical error was still the same: [Japanese implies traitor] <==> [Arizona business owner implies bigot].

But that's not the EE point. What I strive to do here is to understand moral intuitions. In Arnold Kling's terms, this issue is spoken of using the language of oppression. The oppressed have few tools available to them to signal displeasure, among them are economic sanctions. This issue falls flat to libertarians, since explicit coercion is actually decreasing in Arizona. And for conservatives, it allows ordinary citizens to fight back against encroaching barbarism. Of the three moral dimensions, I think I side with the progressive sentiments the strongest. The systematic oppression of LGBT citizens is an affront to common decency. However, I also find myself predisposed to the notion that the heavy lifting of changing minds is a task for rhetoric, not for mulish legislation. Plugging your ears and turning your back punishes the innocent along with the guilty and risks further alienating friends and allies.

There's nothing euvoluntary about refusing ordinary arms-length commerce because of taste-based discrimination. Why work to make the world of peaceful exchange even smaller by withholding your business from folks who would never consider such offensive behavior?

Boycotts are a heuristic. Examine your impulses.

Mitigating Middleman Moral Mileage

Buy cheap, sell dear. This is the middleman's maxim. She improves not her wares, merely transmitting them as near as possible in their original state from the hands of a willing seller to a willing buyer. WoN, IV.2.30:

The act of navigation is not favourable to foreign commerce, or to the growth of that opulence which can arise from it. The interest of a nation in its commercial relations to foreign nations is, like that of a merchant with regard to the different people with whom he deals, to buy as cheap and to sell as dear as possible. But it will be most likely to buy cheap, when by the most perfect freedom of trade it encourages all nations to bring to it the goods which it has occasion to purchase; and, for the same reason, it will be most likely to sell dear, when its markets are thus filled with the greatest number of buyers.

The consequentialist defense of the mancgere is clear: without someone to navigate the water and roadways of the world, it'd be pretty dang tough to get peppercorns in Continental Europe or Toyotas in Kenya.

Please review Mungo's latest piece here and ask yourself if adding moral distance to an exchange is an underappreciated benefit provided by double arms' reach exchange.

To wit, if the actress in question were to provide the same commodity directly to her professors, a barter exchange where a market exchange were available, the issue would cease being a moral curiosity and immediately become grounds for, inter alia, a few hearty rounds of termination of employment.

NB that adding moral distance makes no value distinction. Sometimes it's wise and useful to close buyers and sellers, particularly if doing so can help make Pareto improvements. But don't be too hasty to abandon the virtue of temperance: sometimes moral distance is a feature, not a bug.

No, My First Name Ain't 'Baby'.

If you've been reading EE long enough, you may recall me using the term "pedestrian morality" from time to time. I'm not sure I've adequately explained what I mean there, so let me give it a shot now. Pedestrian morality is not formed from high theory, but it may possibly be described by high theory. Pedestrian morality is the workhorse of the moral mind, getting the basic work of "don't steal", "be nice to old people", "honor your obligations", "refrain from lying" and stuff like that done without too much extra effort. Pedestrian morality is useful for most people in most situations. But it's not, to unrepentantly borrow a term from computer science, Aristotle complete. It's not sufficient for the full flowering of human experience, for areté, nor should it be. Pedestrian morality, with its heuristics, its general rules, its aphorisms, and its allegories is an efficiency device: it civilizes cheaply.

So this cringe-inducing piece from Reason and the ongoing row over a controversial art installation at Wellesley got me thinking about the role of disgust in guiding pedestrian morality. Recall that it's something we've discussed before here at EE. But something odd happens to me reading tales of turpitude and corruption. And the something that happens suggests to me that Jon Haidt is either just a wee bit off the mark or that any pretense I have to the little-l "libertarian" label that might stick to my posterior from time to time doesn't actually belong there.

Jonathan Haidt conducts some truly remarkable research. If you're not already familiar with his work, here he is chatting with the Great Russ Roberts on his opus, The Righteous Mind. One of the great pleasures of casually observing his research unfold in the past few years is how he's updated his understanding of how moral intuitions inform political party affiliation, policy preferences, and most importantly, political views. Specifically, I've had the pleasure of watching him move from a very simple moral interpretation of libertarians (something like "libertarians care about liberty/oppression to the exclusion of all other moral dimensions") to a growing acceptance of the power of framing and the possibility of hidden saliency. If you're of the opinion that libertarians don't care about loyalty, for example, you've probably not spent enough time asking one about the career of one Murray Rothbard.

But it's disgust that got me thinking. Foundation #5. Here's an updated version of a quiz you can take to see how you score. Disgust is a belly-deep reaction. It's visceral, atavistic. Loyalty swells in the breast, but disgust is buried below, stirring the bowel to revolt, the gorge to rise. Disgust rejects reason. Again, in the language of economics, the private opportunity cost of corralling disgust is higher than for muzzling fairness sentiments.

And what does the rational animal do when faced with high private opportunity costs? Politics. If thine eye offend thee, why pluck it out when you can beggar thy neighbor to remove the log from your brother's? The path from "I'm offended" to "you can't do that" is short, rational, and leads ultimately to a world where only the blind roam.

Alas, there are no solutions. Only tradeoffs. It's facile of me to say that we shouldn't legislate disgust. The third link up there in the second graf is a tale of "voluntary" cannibalism. That's gross, dudes and dudettes. And as long as some apparatus for imposing force on civil society exists (excepting perhaps the dregs of the Roman emperors at their most depraved), it seems reasonable to expect to find disgust encoded into the law of the land to a greater or lesser degree. That degree itself is likely a function in part of both historical accident and deliberate rhetorical penetration.

I suppose I don't speak for other libertarians, but for myself, the opportunity cost of overcoming my disgust is one I resolutely refuse to foist on others. It's not just because I'm trenchant in my support for freedom of association, it's for the consequentialist reason that the world produced by cheap censorship is one I find hopelessly dull and for the virtue-aspirational reason that my ability to weather objectionable material enriches my character and affords me the opportunity to investigate the breadth of the human experience. Legislating disgust aversion constricts the universe of euvoluntary exchange on what strikes me as a fairly important margin.

Differential Non-Euvoluntarity in Schelling Decisions

I have to confess to what I gather is called "privilege". I'm a boring suburban white dad. I have a desk job I enjoy. I commute. I have a mortgage, a pretty good education, a lovely wife, a cute-as-a-button daughter, and a modest collection of threadbare socks. I haven't been in a fistfight since 6th grade, I've only been mugged once, and the only time I've been on the receiving end of purposeful gunfire was in (believe it or not) Florida two decades ago. Being a married, middle-aged white male in the modern secular West means I totally won the historical lottery.

Winning this lottery means that I'm vulnerable to charges of arrogance when I try my hand at Smithian sympathy applied to topics outside my ken. I've never been arrested on possession charges, so who am I to discuss the plight of the casualties in the War on American Minorities? Well, at the risk of taking off my boots to reveal feet of clay, I'd like to consider BATNA disparity applied to the Schelling Effect. I'm pretty much guaranteed to never be subjected to routine street harassment, so is the higher opportunity cost faced by my female reader(s?) cause for moral grievance?

Let's ask PJS.

@amelapay: "headphones are the utilitarian solution to street harassment. they get to have their uncivilized outbursts, but you don't hear a thing."

See these? Ram Jam cranked to 11 right now. More Than A Feeling is up next. Jay-Z later.

Hey baby, how bout you and me head back to Mos Eisley for some blue milk? I got a metal bikini that would look great on you.

@adamgurri: You know, princess, "Tasers are the deontological solution." If Kant taught us anything, there's a categorical imperative to enforce social norms. Escaping the Hobbesian concrete jungle where dreams are made of means being a bit of a scoundrel from time to time.

Artoo, you know what I'm talking about, right?

@DrPhilofEconomi: "An intimidating dog is the eudaimonic solution."

Maybe it's time to swap your pocket pooches for a Rottweiler. The Big Apple surely has a rescue shelter or two with burly dogs in need of some kindly foster care. Arete means that you can care for a critter in need of love while you help make the NYC streets a more civilized place to walk. Everyone wins and you don't have to commit assault to get there.


If these comments weren't in jest, I think this'd count as "mansplaining". The economist would be quick to point out that the costs of street harassment are sunk in the initial calculus. Pamela is no dummy. She knows right well that catcalling and rubbernecking is part of the New York life and she decided to live there anyway.

But the economic efficiency argument falls flat, even to me. There's an unjust transfer of PJS's peace of mind to satisfy... well, I don't claim to understand the motivations of hooting, braying, honking, juvenile males. Smithian sympathy goes only so far. Catcalls aren't about picking up chicks (apologies, Robin H.). Point is, there's an uncompensated exchange in there. The benefit roguish men get from hollering noxious, unwanted sentiments at passersby surely counts as psychic pollution. Right?

But the thing that got me thinking was this. This speaks to my insularity, but I hadn't even heard of "male gaze" until relatively recently. To me, there's a pretty significant difference between a man appreciating a beautiful woman on the one hand and catcalling on the other. But that's to me. I'm willing to entertain the idea that I'm wrong about that. Leering and ogling is neither frotteurism nor lewd remarks, but the wispy boundaries of aggression here are at least plausibly contentious. Can staring be psychic pollution?

The Coasean solution strikes me as eminently sensible. Manners are as good as gold. You don't have to be a blue-blood aristocrat to afford everyone else a de minimus parcel of respect and to handle offenses with tact and dignity. If you find yourself compelled to check an attractive woman out, I assure you it's not difficult to do so with discretion. Appreciating beauty need not cause distress. And for the other side of the exchange, I'm afraid I'm at a loss there. Mrs. Wilson is exceptionally good at deflecting unwanted attention, but I never get to see her razor wit at work. No one catcalls her in my presence. Sorry. But not really, since if you came to EE looking for tips on how to handle street harassment, you've got more serious problems than I can help with.

Anyway, in a static sense, there's a gender asymmetry in where to settle. In a dynamic sense, narrowing the BATNA disparity will take strength of character and a bit of creativity. The institutions that support street harassment are not euvoluntary, so finding and securing a better, emergent equilibrium can't be hand-waved (or gavel-banged) away easily.

Morality without Romance

James Buchanan famously described the public choice project as "politics without romance." What he meant by this is that to correctly understand decision making in the absence of prices, the cautious analyst must apply the same logical rigor she uses to understand and explain the market to loosen the joints of non-market decisions. Upon hearing this for the first time, you might be tempted to make a rude gesture and say "duh", but I urge you to reconsider. Think for a moment that not only for much of the intersection of formalized, modern economics and policy recommendation has government been implicitly modeled as deus ex machina, a benevolent despot that can correct instances of market failure, but that this unreflective intuition still survives to this day in a fairly wide swath of the literature.

And unfortunately, in the popular opinion too.

I don't know if Mungo holds the same opinion, but I think of the EE project as an adjunct, an extension to the public choice programme, extending the same logic that works well to describe the exchange of goods and services to the exchange of ideas, of hunches, of morality. It's a project that reconsiders the maxim that de gustibus non est disputandum.

Why is this important? I think there's value in encouraging folks to pause and examine the hodge-podge collection of moral intuitions they've carried since early childhood. By drawing attention to commonly-held beliefs and reasoning from bedrock moral principles rather than just bedrock economic principles, I believe it might be easier to have a clear conversation about the intersection of politics, (pedestrian) philosophy, and economics. EE adds to the specimen box that we peer into with the microscope of economic analysis the blobulus that constitutes the smoky moral lens that ordinary folks use to peek out of the cave.

Is this overreaching? Do not these topics belong to other disciplines? Could be, but Buchanan didn't let that stop him. I'm no Buchanan, not by a country mile, but you have to first plow the field if you ever want your orchard to bear fruit.

On Coercion

Violence is part of the social order. Both the Rousseauvian and the Lockean traditions of political economy recognize that the legitimate use of force in impersonal matters lies exclusively in the hands of the sovereign. You might even say that this is the chief purpose of the state: to excise violence from private individuals that they might pursue careers that benefit others and place it in the hands of a select few that they might enforce the public peace.

You might question the efficacy of this project or its philosophical underpinnings, but it's difficult to avoid the conclusion that from stem to stern, the state is an organization whose bread and butter is coercion.

Now, at the risk of eliding mountains of scholarship on this point, I'll ask you to accept the positive point I just made and consider a normative claim on coercion that I think I've mostly assumed since the GTM so graciously invited me to share my thoughts here at EE. Namely, that the proper role of coercion in civilized society is best kept sharply constrained.

Skipping airy justifications, the bedrock of my aversion to frivolous coercion is that I have a sense that coercion dilutes virtue. And it does so no less for the coercer as for the coerced. Since I see the pursuit of a virtuous life as a small-n puzzle, one approached by individuals in their monkeyspheres, I am naturally skeptical about the ability of distant elites to improve on the difficult task of discovering and enacting the recipe of a virtuous life. Worse yet, misapplied coercion may actively hamper or pervert this most human of all pursuits. The tragically-named "War on Drugs" (War on most any domestic issue, really) is a fine example, where families are rent asunder and men turned to lives of ignominy to what end I cannot fathom. Yes, there are considerations more important than a virtuous life well-lived, but I worry that the decision to employ force all too easily ignores many of the hidden, third-party costs that lurk in the crevices. A cost-benefit analysis that disregards lurking costs is (again, normatively) unacceptably shoddy.

It's plainly obvious that there's a lot of transactions that fall short of the euvoluntary ideal. It's not as obvious that the remedy of direct coercion is the best way to correct these shortcomings. Not only does coercion incur direct hidden costs, it robs people the ability and the incentives to strive for a more virtuous existence. And to me, that's a cruel injustice in a world where human lives are constrained by mortality and scarce attention.

Nadie Queiran Volar con la Gorda

I'm no shrinking violet. Yet at 5'11" and tipping the scales somewhere in the neighborhood of 225#, I'm the runt of the EE litter. Our spouses? That's another matter. Mrs. Spivonomist claims doughty Lithuanian yeoman heritage, but even with that pedigree, she wouldn't even qualify for a super featherweight fight. Emma resembles nobody so much as a lithe Audrey Hepburn, and the LMM would struggle to balance the scales against a drinking straw. We're a trio of lumberjacks with dainty little wives, though we do manage to ever so slightly buck the trope of dumb fat guy-with-smart skinny wife by dint of some academic competence.

We've posted before on the topic of Large Folk on Airplanes. Today's big news is Air Samoa, who is raising hackles by a proposal to have a variable airfare schedule based on passenger-plus-luggage weight. Now, depending on the sort of price discrimination algorithm used, the average per-person price for the Euvoluntary Exchange blog crowd might very well be the same before and after. My chubby thunder-tuchus might have to pay a bit more, but my diminutive bride could make up for the difference. Is this euvoluntary? What about if it's not mean-neutral? What's the appropriate cluster? Is it important when you partition median body weight by real income category?

A few days ago, I spilled some pixels defending the notion of equal treatment in the eyes of the law. Do these same arguments extend to equal treatment in the eyes of an industry with high fixed costs or other barriers to entry? Is my BATNA of being unable to fly (to Samoa, for now) sufficiently unattractive that agents of the state should step in and restore... well, "fairness" isn't the right word, since airlines already deploy quite a bit of price discrimination based on whether or not you're a business or a pleasure flyer... "justice", perhaps? Is price discrimination unjust? Is it morally just to hold a passenger accountable for his girth? Most folks seem fine with some price discrimination based on income, on gender (oh yes it's Ladies' Night and I'm feeling right), on age. Not so much on race, on sexual orientation, on political party affiliation (and please note that attitudes, strangely, seem to vary widely based on whether or not the price discrimination is forwarded as either a premium or a discount), so what's the rule? When is it okay to price-discriminate?

More interestingly, why didn't Samoa Air announce a policy where they give discounts to svelte passengers while stealthily hiking base rates under the radar? Airline marketing departments can't still be that obtuse, can they?

Curious stuff.

The Green-Eyed Rationalist

"Thou shall not covet..." features prominently in the Ten Commandments because of elementary economics.

Information is scarce, which is to say two things: it is valuable and it is costly to obtain. That information is valuable is trivially obvious. The costs might be a little bit harder to grasp, but consider that to become knowledgeable about something, you need to obtain, process, and interpret signals. Each step poses its own challenges. I submit to you that it's sensible to be thrifty in each step. We generally specialize and trade when it comes to obtaining information, hence the press. Signal processing is done by the elephant most of the time, preserving the rider for truly novel, challenging situations that demand close scrutiny. Even interpretation is often left in the hands of others who have done the heavy lifting for us. Why bother formulating the foundations of moral theory from scratch each time you're presented with an ethical dilemma? Kant's already done it for you. Or Aristotle, or Aquinas, or Bentham, or Nietzsche, or whoever you like.

So why shall thou not covet thy neighbor's ox? Think about envy as a way of economizing on scarce information. Art lives next to Betty, who earned her oxen by pillaging and looting Lothar of the Hill People over on the other side of the valley. Carl moves into the empty hut to Art's left, droving an oxherd at least as grand as Betty's, so Art could perhaps be forgiven for assuming that Carl has also gained his wealth through the liberal application of violence.

I'm willing to claim that envy is a more-or-less useful heuristic for the circumstances that marked the large bulk of human history. Under conditions of low capital accumulation, wealth differences were more likely to arise not because of the gains from trade protected by secure property rights, but by the careful application of brute force. You see a rich dude, he's probably rich because he's a cheat, a bully, or a racketeer. Now spin the clock forward to the era of merchantry, and we've got a much different story. The sea captain who buys cheap and sells dear ends up with a train of oxen as large as that of the prince who wrings the fat of the land from his lean, immiserated serfs. The same heuristic that makes Art wary of Duchess Betty's wealth is entirely inappropriate when applied to Carl the Monger. When there are more Carls running about than Bettys, heuristic substitution by divine fiat is probably a good least-cost means of protecting valuable capital from re-allocation by rationally envious goatherds. Mobs restrained by the Word of God allow honest farmers and merchants to make us all wealthier through their industry and thrift.

But what, you ask, does any of this have to do with euvoluntary exchange? Well, I claim that paternalism grounded in concerns for BATNA disparity leverages envy by proxy.

Darvis is an itinerant oxhand looking for work. Betty hires him and sets to working him to the bone and paying him a pittance. Art sees this and denounces Betty, that cruel exploitrix. Sure enough, he rallies the townsfolk to dismantle her ranch and reassign her property to each according to his needs. Bereft of his daily bread, Darvis slouches to Carl's to ply his trade. The sad saga repeats, but this time two honest men are ruined instead of just one. Relying on cheap (though still rational) heuristics leads to avoidable tragedy.

"Smash the rich" sentiments can reasonably be justified when the riches accumulate through the use or threat of violence. I think it's fair to be suspicious of folks who "earn" sizable boodles in the warm embrace of the state. Conflating wealthy merchants with crony capitalists may be an easy cognitive shortcut, but it's one that unjustly threatens peaceful voluntary trade. "Rip the System" might be a more useful sentiment to the extent that it encourages institutional reform in the direction of open access orders, fiscal federalism, and an impersonal rule of law. This must, of course, run jointly with a thoroughgoing appreciation for the wonders wrought by lawful capitalism. I think Americans have a general appreciation for this, deep down. Question folks about their attitudes towards the amorphous "rich", then follow it up with questions about specific rich people. I think you'll find most of the contempt restricted to, well, the contemptuous wealthy (not named here since I'm not keen on defending libel suits). Few people I've spoken with begrudge honest business folk their holdings.

The lemma to this is that the real aversion is all on the low end. We hate seeing relative poverty because of pity for the poor, not strictly because of envy of the rich. I'm inclined to believe that this is a strangely American phenomenon, but I'll freely admit that this hypothesis requires more research.


Sascha Konietzko: underappreciated philosopher

Guilt as Coercion

Quick show of hands: how many of you have made a mad dash for the florist after inelegantly cramming a freshly-polished Chuck Taylor in your gob? If I can eventually reject the null hypothesis that n of you=0, then the probability that somewhere between one and all (both?) of my readers understand that the coercing party to a trade ain't the party of the first part nor the party of the second part. It's pretty often the party of the aggrieved part, no matter how illusory might that grievance be.

Case number one: Mr. Sperlonjohannssenmannvich had to stay late to finish up a report on the Vickers account and missed Sally's flute recital. Racked with guilt, he buys her a puppy and the latest Pet Shop Boys LP (ha ha anachronism).

Case numero dos: Pablo Morales has been growing coffee since he was knee-high to Juan Valdez's trusty burro (¡Disfrute de un buen café!), and Calpurnia Pisonis of Rome, GA just saw a nicely-done documentary on Netflix about how Pablo is being exploited by the coffee exchanges in Buenos Aires. Aghast, filled to the brim with twenty years' guilt over taking coffee growers for a ride, she pledges to switch to Fair Trade (a registered trademark of the Fairtrade Foundation) Coffee.

Cases one and dos rely on similar perceptions. Sally's stoicism precludes her from crying to daddy about his neglect, meaning that he's apologizing to an avatar he created ex ante to head off hurt feelings at the pass. Calpurnia likewise needs no actual contact with Pablo to "know" that he's being ripped off by his chosen trade. Guilt in each case is compelling a voluntary trade (one for a puppy/vinyl combo, the other for fresh-roasted whole bean aromas), so there's not too much for a euvoluntaryist to bellyache about here.

But wait! There's more!

Case 3: K.L. Giffins has a line of clothing manufactured in the Gabonese Republic. The Grey Lady gets wind of the factory conditions and for a solid week, the Times' Op-ed page is flush with calls for immediate and unequivocal boycott. Loyal readers comply over the pitiful objections of a few crank economists.

Case five: Collective guilt over the institution of slavery leads the US Congress to "repatriate" former slaves to the newly sovereign nation of Liberia.

These cases take the intuitions underpinning the first two and apply them with less finesse. Consider the difference between the coffee and the t-shirts: Pablo could at least apply for fair-trade status if he thought it worth the effort. Giffins and her employees are just plain sunk. The alternatives for the java are: a) stay in business and make traditional ICO rates or b) hop on the Fair Trade streetcar and make their rates. The alternatives for Giffins is to a) try to mollify customers somehow or b) shutter the factory. If it's unprofitable to do (a), then it's back to... use your imagination... for the former seamstresses.

The less said about Liberia, the better.

So, it seems that at the appropriate scale, guilt probably serves as a decent enough sentiment to compel us to deeds that serve our interests. Start down the trail of collectivizing and enforcing it, and pretty soon, we leave the vale of euvoluntarity behind and may end up with bloodthirsty tyrants like Chuck Charles Taylor brought up on crimes against humanity.

Beware guilt, for she is as fire.

Webinar (also)

So, attended a "webinar" with the wonderful Sarah Straw of IHS, on the subject of EE and non-worseness. Very interesting experience, several good questions. Co-blogger Mike Munger gave the talk, and that was nice!

 I asked a question on consequentialism vs deontology and got back a very clear answer that I should have included in my recent post on the issue. Simply put, there are occasional conflicts between deontological objections to trade and the consequences they generate. When this happens, the circumspect thing to do is to consider whether the benefit you get from assuaging your moral discomfort is worth the practical price that others have to pay on your behalf. The "private benefits; public costs" problem is one of the cornerstones of Virginia School Public Choice, of which I count myself a student. I apologize to my readers for not being more clear and I thank the GTM for thoughtfully and gently reminding me without resorting to the name-calling I probably deserve.

The Hammer of the Gods

Like many of my colleagues, I gave two cheers for the recent announcement by the administration to stop deporting children who may have been born over the border but have lived in the United States their whole lives and may even be in the Armed Forces. It's true that this executive decision is peanuts compared to comprehensive immigration reform, but when you're hungry, even a little airline packet of honey-roasted is better than nothing.

Lost and Found Redux: Lost and Founder

In my last post, I referenced a classic opportunity cost exam question. The scenario stipulates that you've camped out overnight for tickets to a concert whose box office price was $300. Before you got to the window, the tickets had been sold out. Dejected, you slog back to your car, but on the way you find tickets being sold by scalpers for a fivefold markup. Unwilling to shell out $1500 for the tickets, you hop in your Volvo Taco Truck and head to the nearest Waffle House for some smothered hash browns and watery coffee.

In your booth, you find an envelope. The envelope is not sealed, so you peer inside. Lo and behold, you find tickets to the very concert you were camped out for. At this point there is some hurried lip service to discharging a moral duty to return the property to its rightful owner, then the professor gets to the real meaty question: what do you do, attend the concert or head back and sell your windfall find? The answer tells you whether or not your students picked up the idea of opportunity cost (hint: many of them haven't). That's fine, but the scenario got me to thinking.

Assuming that there is indeed a moral imperative to find the original owner, does that obligation depend on the contents of the envelope? Is there a similar moral duty to return $1500 cash as there is to return $1500 worth of concert tickets?

We all know that value is subjective, but the closest thing we have to objective value is cash (nod to Nathanael Snow for reminding me that the value of cash is more contextual than subjective), so $1500 cash is worth $1500. $1500 in tickets is subjectively worth $1500 or more to the original owner. They were somewhere up there on the upswing of the demand curve.

So given this self-evident premium, should there be more consideration given to restoring goods to the original owner than to a market-equivalent amount of cash? Is this trash-treasure relationship relevant? If the owner of a booger collection who valued his lost or stolen boogers at half a million dollars be as deserving of restoration as a half-million dollar sapphire necklace owner? What are the relevant margins? Presumed social status? Does your own subjective valuation matter? When you find something, what assumptions do you make? Which of these are relevant to the effort you spend reuniting property with the rightful owner?

How do we form moral intuitions over found property and how do those intuitions change when we find cash instead of stuff?

And why would you go to der Waffle Haus when you drive a perfectly good taco truck?

Too Few To Mention

Chatting with one of my students yesterday, I found myself at loggerheads over an appropriate description of EE-relevant regret. It seemed to me that regret happens when outcomes don't match expectations. Moreover, it's when outcomes fall short of expectations. A recent example for me was the inexplicably popular film The Hunger Games. Many of my friends that I hold in quite high esteem assured me that the books were pretty good and the press coverage of the film suggested it would be good. I was bitterly disappointed.

She Sewed My New Blue Jeans

Take the spectrum of gambling activities: on one end, sordid back-alley dice, cockfighting, pool hustling and mob-run numbers rackets. On the other end lie state-operated lotteries, church raffles, gentlemen's wagers and NASDAQ. Betwixt would be office fantasy football leagues, casinos, InTrade, OTB, Jai-Alai et al.

The sordid sorts of gambling (dog fighting for example) could be objectionable because of the context of the contest: it's cruel to force animals to disfigure or kill each other for sport (naturally, this presumes quite a bit about an implied counterfactual state of the world, but let's leave that alone for now). Other forms may rely on other analysis. Consider the following arguments:

1. Gambling acts as a transfer scheme that moves wealth from stupid (and usually poor) people who don't understand the laws of probability and expected value calculations well enough to make informed decisions. This implies paternalist responsibilities to prevent disadvantaged people from being fleeced.
2. Allowing low-status people to collect producer surplus in a gambling market is objectionable. The mafioso who run numbers are collecting rents rather than producing useful services. It might be fine for the state to collect lottery earnings since those will be used to provide essential public goods, but the Don will just spend it on lavish wedding receptions for his daughters.
3. Gambling is dynamically inefficient. Instead of building human capital, players will forgo the acquisition of work skills to blow their meager paychecks on a sliver of hope for striking it rich. This is another pinion in the engine of poverty.
4. On this point, I owe consideration to my friend and colleague Tom Duncan. There is a non-trivial probability that people find certain types of gambling objectionable based strictly on their explicit legal status. Some gambling markets are wrong just because the legislature says so.
5. Gambling varies by social class and wealth. The rich can gamble to their hearts' content since their BATNA might imply not being able to take that vacation to the Bahamas this year, but for poor folks, it means the baby won't get formula this week.

Of all these, #4 is both the most preposterous and the most plausible. It's preposterous because it suggests that folks don't give much consideration to their beliefs and it's the most plausible because, well, people probably actually don't give much consideration to their beliefs. It can be mentally efficient to outsource morality to elected officials. Some of the recent Public Choice work supports this notion (see, eg The GTM's recent JEBO article, Persuasion, Psychology, and the Future of Public Choice {sorry, I can't find an ungated link. If you have access to JSTOR then check there, otherwise there's a possibility the author may be willing to send you a copy}).

At any rate, there's a curious question in there somewhere. What are the elements of games of chance that make one gambling scheme acceptable and another not? What is the role of local knowledge and morality that explain geographical and cultural variance? Can gambling ever be truly euvoluntary?

Mawwiage Is What Bwings Us Togevver Today

The always-excellent Bryan Caplan makes some interesting points today on the liberalization of military labor contracts and the implications for other long-term contracture (specifically, marriage contracts, though one might imagine taking the notion further).

Part of my day job research interests deal with the intersection of military labor contracts and biased beliefs. If we look at arrangements like marriage or military service as a Bayesian process with quasi-predictable posterior nodes (that would be a good name for a band), contracts like the ones described by Caplan anticipate systematic regret. In the military, this could be the post-training blues; in married life, it could be the seven-year itch.

Interesting then the disparity. The lack of at-will employment in the Armed Services suggests acknowledgement of the non-euvoluntary nature of military service. Here however, simply voluntary is plenty to mollify the compassionem publica. Not so for marriage, it seems. The same arguments that would permit the DoD to enforce an enlistment contract would be thrown out of court on their ear were they presented before a family courts judge. I suspect the legal reasoning would pivot on the "good of the National Defense", and it's harder to make the case that marriage is a pure public good so there probably is at least some plausible logic behind the status quo ante, but it sure would be interesting to ceteris parebus see how intuitions over ex post regret vary from institution to institution. We bar Soldiers and Sailors from indulging regret, but not married couples. We bar students from indulging regret over borrowing to finance education (for the most part anyway--it's very difficult to dispose of student loan debt) though the US Treasury will underwrite large lending houses after the fact when they've made regrettable decisions.

How stable or unstable are intuitions about the role of regret when it comes to honoring contracts? Are people consistent in their reasoning? What is more important, protecting the rules of the game or bailing out losers? What is the role of ergodicity in bounding rationality? I will take this opportunity to reserve some thoughts on Armin Meiwes for a future post related to this topic.

Tune in, Turn on, Drop out

By my reckoning, I'm a little late to the party of criticizing the latest State of the Union address. Among the other... let's call them "bold"... policy suggestions forwarded by the President, the one that caught my attention concerned mandatory schooling.

To paraphrase, the POTUS suggested it might be wise for states to raise the minimum dropout age to 18, thereby increasing education rates. Much of the discussion on this point (at least on those blogs I follow) concern classroom externalities, the nature of the assumed linear relationship to formal education and earnings, or to this or that signaling model. These and points like them are very interesting and contain valid criticism, but when I see popular policy nostrums, I fancy that I've trained myself well enough to ask which euvoluntary principles are being violated by the status quo. I confess that I have yet to rest on any particular answer.