For Your Own Good

A friend of mine lent me a copy of Robert Frank's "Falling Behind: How Rising Inequality Harms the Middle Class" and, starting last might, I blitzkrieged my way through it. The basic premise is simple - rising income and wealth inequality is bad for everyone, and that it harms the middle class in particular. It's a very interesting book, lightly and deftly written. It avoids a lot of jargon and going off into the weeds, although this does make it seem a bit unsupported at times. A number of Frank's ideas have gained some mainstream traction so I was familiar with them already - even so it was interesting to see them in a complete intellectual context.

The basic jist of the book can be summed up this way. The spending habits of people at the upper end of the wealth and income distribution tend to foster a certain level of necessary imitation - not only from their peers, but from people farther down the ladder, as we do not judge solely in relation to our own circumstances, but have to "keep up with the Joneses," as it were. As the distance between the top and the bottom increases, the people at the lower end of the ladder find themselves spending more and more simply to try to stay in the race; and it is a race that they cannot voluntarily drop out of, because there are very real social, economic and physical consequences for not playing.

One of the major tenets of the book is that we often engage in behaviors that are very smart from an individual perspective, but pointless or even counter-productive when we all engage in them. The common explanation of "the Tragedy of the Commons" is an example. If I share a common pasture, it makes sense for me to utilize as much of this "free" resource as I possibly can. But when everyone does the same, the pasture is quickly overgrazed, and there is nothing for anyone. Accordingly, conservation of the pasture only makes sense if everyone else does it, otherwise those who conserve are simply leaving resources on the table to be exploited by others who will overuse them, and the overgrazing still occurs.

By the same token there are activities that are "smart" when everyone engages in them, but have nasty potential consequences for the individual. These examples are the ones where Mr. Frank devotes most of his energy. One is that we'd all be better off if we bought smaller cars - but if I have a small car, and you have a large one, I have a much greater risk of dying if our cars collide, so the smart thing for me to do is buy the largest vehicle I can afford (where size is roughly correlated with cost). Such scenarios are important to the book, because they establish the necessity of spending that we would otherwise consider to a function of conspicuous consumption, and thus, purely discretionary.

It was all very interesting, but I started to sour on it towards the end, when Frank began making policy recommendations. Mainly because Frank falls back on the common refrain of the committed social engineer: When confronted with behaviors that are socially desirable, but lose out to behavior that are individually desirable, the way to promote the socially desirable behaviors is to artificially poison the individually desirable behaviors. In other words, you promote the behaviors you want not by making those behaviors more rewarding, but by making the ones you don't want less rewarding.

I understand the strategy, but not only does it demand a high degree of control over people's lives and circumstances, but it presumes that you've accurately covered all of the possibilities. Making "A" less attractive to promote "B" presumes that there is no third option "C" that people will find more attractive than "B." Making "B" more attractive than "A" on it's own merits seems like a better choice. But no-one ever seems to advocate for it. Part of it seems to be a focus on outcomes, crossed with a dualistic world-view. If all I want is more of "A" and "B" is the only viable alternative, promoting "A" or discouraging "B" aren't functionally different. In the end, I think a lot of it comes down to: "Once we've done this, people will see the benefits and then they'll come on board. But right now, it's too hard to explain it to them, and getting it done is more important than garnering public support." I've never felt that this was a winning strategy. People don't support items that they don't perceive as being in their best interests, regardless of how often someone else declares that it is. And when something they don't support is foisted upon them, they start looking for ways to get around it. But I am starting to really wonder why it's so common, considering the limited number of scenarios in which it would be the optimal path.