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It’s For Your Own Good!

1.

In the United States, as in many other countries, obesity is a serious problem. New York Mayor Michael Bloomberg wants to do something about it. Influenced by many experts, he believes that soda is a contributing factor to increasing obesity rates and that large portion sizes are making the problem worse. In 2012, he proposed to ban the sale of sweetened drinks in containers larger than sixteen ounces at restaurants, delis, theaters, stadiums, and food courts. The New York City Board of Health approved the ban.

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ConsumerFreedom.com
Detail of a 2012 advertisement protesting New York Mayor Michael Bloomberg’s proposed ban on the sale of soda in containers larger than sixteen ounces

Many people were outraged by what they saw as an egregious illustration of the nanny state in action. Why shouldn’t people be allowed to choose a large bottle of Coca-Cola? The Center for Consumer Freedom responded with a vivid advertisement, depicting Mayor Bloomberg in a (scary) nanny outfit.

But self-interested industries were not the only source of ridicule. Jon Stewart is a comedian, but he was hardly amused. A representative remark from one of his commentaries: “No!…I love this idea you have of banning sodas larger than 16 ounces. It combines the draconian government overreach people love with the probable lack of results they expect.”

Many Americans abhor paternalism. They think that people should be able to go their own way, even if they end up in a ditch. When they run risks, even foolish ones, it isn’t anybody’s business that they do. In this respect, a significant strand in American culture appears to endorse the central argument of John Stuart Mill’s On Liberty. In his great essay, Mill insisted that as a general rule, government cannot legitimately coerce people if its only goal is to protect people from themselves. Mill contended that

the only purpose for which power can be rightfully exercised over any member of a civilized community, against his will, is to prevent harm to others. His own good, either physical or mental, is not a sufficient warrant. He cannot rightfully be compelled to do or forbear because it will be better for him to do so, because it will make him happier, because, in the opinion of others, to do so would be wise, or even right.1

A lot of Americans agree. In recent decades, intense controversies have erupted over apparently sensible (and lifesaving) laws requiring people to buckle their seatbelts. When states require motorcyclists to wear helmets, numerous people object. The United States is facing a series of serious disputes about the boundaries of paternalism. The most obvious example is the “individual mandate” in the Affordable Care Act, upheld by the Supreme Court by a 5–4 vote, but still opposed by many critics, who seek to portray it as a form of unacceptable paternalism.2 There are related controversies over anti-smoking initiatives and the “food police,” allegedly responsible for recent efforts to reduce the risks associated with obesity and unhealthy eating, including nutrition guidelines for school lunches.

Mill offered a number of independent justifications for his famous harm principle, but one of his most important claims is that individuals are in the best position to know what is good for them. In Mill’s view, the problem with outsiders, including government officials, is that they lack the necessary information. Mill insists that the individual “is the person most interested in his own well-being,” and the “ordinary man or woman has means of knowledge immeasurably surpassing those that can be possessed by any one else.”

When society seeks to overrule the individual’s judgment, Mill wrote, it does so on the basis of “general presumptions,” and these “may be altogether wrong, and even if right, are as likely as not to be misapplied to individual cases.” If the goal is to ensure that people’s lives go well, Mill contends that the best solution is for public officials to allow people to find their own path. Here, then, is an enduring argument, instrumental in character, on behalf of free markets and free choice in countless situations, including those in which human beings choose to run risks that may not turn out so well.

2.

Mill’s claim has a great deal of intuitive appeal. But is it right? That is largely an empirical question, and it cannot be adequately answered by introspection and intuition. In recent decades, some of the most important research in social science, coming from psychologists and behavioral economists, has been trying to answer it. That research is having a significant influence on public officials throughout the world. Many believe that behavioral findings are cutting away at some of the foundations of Mill’s harm principle, because they show that people make a lot of mistakes, and that those mistakes can prove extremely damaging.

For example, many of us show “present bias”: we tend to focus on today and neglect tomorrow.3 For some people, the future is a foreign country, populated by strangers.4 Many of us procrastinate and fail to take steps that would impose small short-term costs but produce large long-term gains. People may, for example, delay enrolling in a retirement plan, starting to diet or exercise, ceasing to smoke, going to the doctor, or using some valuable, cost-saving technology. Present bias can ensure serious long-term harm, including not merely economic losses but illness and premature death as well.

People also have a lot of trouble dealing with probability. In some of the most influential work in the last half-century of social science, Daniel Kahneman and Amos Tversky showed that in assessing probabilities, human beings tend to use mental shortcuts, or “heuristics,” that generally work well, but that can also get us into trouble.5 An example is the “availability heuristic.” When people use it, their judgments about probability—of a terrorist attack, an environmental disaster, a hurricane, a crime—are affected by whether a recent event comes readily to mind. If an event is cognitively “available”—for example, if people have recently suffered damage from a hurricane—they might well overestimate the risk. If they can recall few or no examples of harm, they might well underestimate the risk.

A great deal of research finds that most people are unrealistically optimistic, in the sense that their own predictions about their behavior and their prospects are skewed in the optimistic direction.6 In one study, over 80 percent of drivers were found to believe that they were safer and more skillful than the median driver. Many smokers have an accurate sense of the statistical risks, but some smokers have been found to believe that they personally are less likely to face lung cancer and heart disease than the average nonsmoker.7 Optimism is far from the worst of human characteristics, but if people are unrealistically optimistic, they may decline to take sensible precautions against real risks. Contrary to Mill, outsiders may be in a much better position to know the probabilities than people who are making choices for themselves.

Emphasizing these and related behavioral findings, many people have been arguing for a new form of paternalism, one that preserves freedom of choice, but that also steers citizens in directions that will make their lives go better by their own lights.8 (Full disclosure: the behavioral economist Richard Thaler and I have argued on behalf of what we call libertarian paternalism, known less formally as “nudges.”9) For example, cell phones, computers, privacy agreements, mortgages, and rental car contracts come with default rules that specify what happens if people do nothing at all to protect themselves. Default rules are a classic nudge, and they matter because doing nothing is exactly what people will often do. Many employees have not signed up for 401(k) plans, even when it seems clearly in their interest to do so. A promising response, successfully increasing participation and strongly promoted by President Obama, is to establish a default rule in favor of enrollment, so that employees will benefit from retirement plans unless they opt out.10 In many situations, default rates have large effects on outcomes, indeed larger than significant economic incentives.11

Default rules are merely one kind of “choice architecture,” a phrase that may refer to the design of grocery stores, for example, so that the fresh vegetables are prominent; the order in which items are listed on a restaurant menu; visible official warnings; public education campaigns; the layout of websites; and a range of other influences on people’s choices. Such examples suggest that mildly paternalistic approaches can use choice architecture in order to improve outcomes for large numbers of people without forcing anyone to do anything.

In the United States, behavioral findings have played an unmistakable part in recent regulations involving retirement savings, fuel economy, energy efficiency, environmental protection, health care, and obesity.12 In the United Kingdom, Prime Minister David Cameron has created a Behavioural Insights Team, sometimes known as the Nudge Unit, with the specific goal of incorporating an understanding of human behavior into policy initiatives.13 In short, behavioral economics is having a large impact all over the world, and the emphasis on human error is raising legitimate questions about the uses and limits of paternalism.

3.

Until now, we have lacked a serious philosophical discussion of whether and how recent behavioral findings undermine Mill’s harm principle and thus open the way toward paternalism. Sarah Conly’s illuminating book Against Autonomy provides such a discussion. Her starting point is that in light of the recent findings, we should be able to agree that Mill was quite wrong about the competence of human beings as choosers. “We are too fat, we are too much in debt, and we save too little for the future.” With that claim in mind, Conly insists that coercion should not be ruled out of bounds. She wants to go far beyond nudges. In her view, the appropriate government response to human errors depends not on high-level abstractions about the value of choice, but on pragmatic judgments about the costs and benefits of paternalistic interventions. Even when there is only harm to self, she thinks that government may and indeed must act paternalistically so long as the benefits justify the costs.

Conly is quite aware that her view runs up against widespread intuitions and commitments. For many people, a benefit may consist precisely in their ability to choose freely even if the outcome is disappointing. She responds that autonomy is “not valuable enough to offset what we lose by leaving people to their own autonomous choices.” Conly is aware that people often prefer to choose freely and may be exceedingly frustrated if government overrides their choices. If a paternalistic intervention would cause frustration, it is imposing a cost, and that cost must count in the overall calculus. But Conly insists that people’s frustration is merely one consideration among many. If a paternalistic intervention can prevent long-term harm—for example, by eliminating risks of premature death—it might well be justified even if people are keenly frustrated by it.

To Mill’s claim that individuals are uniquely well situated to know what is best for them, Conly objects that Mill failed to make a critical distinction between means and ends. True, people may know what their ends are, but sometimes they go wrong when they choose how to get them. Most people want to be healthy and to live long lives. If people are gaining a lot of weight, and hence jeopardizing their health, Conly supports paternalism—for example, she favors reducing portion size for many popular foods, on the theory that large, fattening servings can undermine people’s own goals. In her words, paternalism is justified when

  1. 1

    It is important to emphasize that Mill was concerned with coercion of all kinds, including those forms that come from the private sector and from social norms. 

  2. 2

    To be sure, the individual mandate can be, and has been, powerfully defended on nonpaternalistic grounds; above all, it should be understood as an effort to overcome a free-rider problem that exists when people do not obtain health insurance (but are nonetheless subsidized in the event that they need medical help). 

  3. 3

    See, for example, Shane Frederick et al., “Time Discounting and Time Preference: A Critical Review,” Journal of Economic Literature, Vol. 40, No. 2 (2002), p. 351; Stephan Meier and Charles Sprenger, “Present-Biased Preferences and Credit Card Borrowing,” American Economic Journal: Applied Economics, Vol. 2, No. 1 (2010), p. 193; Hal E. Hershfield et al., “Increasing Saving Behavior through Age-Progressed Renderings of the Future Self,” Journal of Marketing Research, Vol. 48 (2011), p. S23. 

  4. 4

    For neurological evidence, see Jason P. Mitchell et al., “Medial Prefrontal Cortex Predicts Intertemporal Choice,” Journal of Cognitive Neuroscience, Vol. 23 (2010), pp. 1, 6. 

  5. 5

    Amos Tversky and Daniel Kahneman, “Judgment under Uncertainty: Heuristics and Biases,” Science, Vol. 185, No. 4157 (1974), p. 1124. Kahneman summarizes this work in his book Thinking, Fast and Slow (Farrar, Straus and Giroux, 2011). 

  6. 6

    See generally Tali Sharot, The Optimism Bias (Pantheon, 2011). 

  7. 7

    See Paul Slovic, “Do Adolescent Smokers Know the Risks?,” Duke Law Journal, Vol. 47, No. 6 (1998), pp. 1133, 1136–1137. 

  8. 8

    See Colin Camerer et al., “Regulation for Conservatives: Behavioral Economics and the Case for ‘Asymmetric Paternalism,’” University of Pennsylvania Law Review, Vol. 151 (2003), p. 1211; George Loewenstein et al., “Asymmetric Paternalism to Improve Health Behaviors,” Journal of the American Medical Association, Vol. 298, No. 4 (2007), p. 2415. 

  9. 9

    Richard H. Thaler and Cass R. Sunstein, Nudge: Improving Decisions About Health, Wealth, and Happiness (Yale University Press, 2008). 

  10. 10

    See President Barack Obama, weekly address (September 5, 2009), announcing initiatives to increase participation in IRA s and match retirement savings. 

  11. 11

    See Raj Chetty et al., “Active vs. Passive Decisions and Crowd Out in Retirement Savings Accounts: Evidence from Denmark” (December 2012), available at obs.rc.fas.harvard.edu/chetty/crowdout.pdf; Eric J. Johnson and Daniel G. Goldstein, “Decisions by Default,” in The Behavorial Foundations of Public Policy, edited by Eldar Shafir (Princeton University Press, 2012), p. 417. 

  12. 12

    A detailed account appears in Cass R. Sunstein, Simpler: The Future of Government (forthcoming 2013); see also Cass R. Sunstein, “Empirically Informed Regulation,” University of Chicago Law Review, Vol. 78 (2011), p. 1349. 

  13. 13

    The official website states that its “work draws on insights from the growing body of academic research in the fields of behavioural economics and psychology which show how often subtle changes to the way in which decisions are framed can have big impacts on how people respond to them.” See The Behavioral Insights Team, Cabinet Office, www.cabinetoffice.gov.uk/behavioural-insights-team. 

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