Saturday, June 4, 2011

Market theory - money as the only motivator

The theory of free markets that has dictated US policy for decades is based on the assumption that people are motivated to work and achieve almost exclusively by economic considerations, or, more succinctly, money.  So law should view money as the primary way to motivate people.


In my experience this assumption is correct as to some percentage of the population but completely wrong as the large portions of the population.


Certainly we all like money, very few of us would turn down a raise in pay if it was offered.  But some of us like it a whole lot more than others.


Many people work to make money, and where they can make the most money is the sole determinant of their job.  In some cases it is just having lots of money to play with, in some cases it is because making more money than others is the way they validate their importance.  Paying these people more as a carrot to increase productivity works if productivity goals are easily quantified (like increasing profits).  If necessary they will sacrifice family, health and endure stress to achieve their single most important goal.


But many other people have a more diverse set of values, where making lots of money may be far down the list of values.  Things like liking what they do.  Treating other people with honesty and consideration.  Having time to spend with family and friends.  Taking care of their health.  Taking pride in being good at what they do.  There is a point where once they have a reasonable level of security paying people more will not lead them to be more productive, because they are unwilling to sacrifice their other values.


Using money as a motivator generally is pretty effective in the private sector, because the goal is so easily quantifiable (make more money).  In the public sector where goals are diffuse and complex, paying too much money attracts the folks motivated by money, and crowds out very competent people whose basic inclinations are more in line with the service nature of the public sector.  Public sector compensation should be structured to provide long term security, not riches.

Tuesday, May 31, 2011

Striving to be an Armadillo

In the Washington hubris back around 2005 or 2006 a member of Congress from Texas famously sneered about middle of the road voters that they were like Armadillo's, they get run over from both sides of the road.


Ideologues from all sides of the political spectrum dislike moderation.  Their intellectual worlds are built around logical constructs built on foundations of simplistic assumptions and characterizations about human nature and the world we live in.  They like clean logic, they don't like the messy ambiguity that often characterizes life.  Once they have their logical ideology in place they can be an expert on anything thereafter by plugging into the ideology and starting to talk, without the time consuming necessity of investigating facts or considering options.


Ideologues don't like moderates because moderates always seem to want to complicate their grand ideas with inquiries into whether assumptions are true.


If your only ambition in life is to be a politician its not a bad idea to latch onto an ideology.  You can speak confidently and authoritatively on any subject, on a moments notice, while people actually evaluating options and facts are being silent.  And a big plus is most voters don't have time to evaluate options and facts, in fact they don't even have time to listen to a long spiel about facts and options.  They like a short sweet sound bite that is emotionally appealing and will often go with it.


Unfortunately, if you actually want to be a positive influence in your life, history suggests being an ideologue is probably not the way to go.  In the United States the great depression of the 1930's and the great recession we are still recovering from both followed years of conservative ideology running the show.  From 1921 through 1933 Republicans controlled both houses of Congress and the Presidency.  That didn't happen again until 2001 to 2007.  Both periods were marked by unwavering belief that cutting regulation on business, cutting taxes and cutting the size and influence of Government were the key to a prosperous future.  Of course what actually happened at the end of each period was the two worst economic crashes in the last 100 years.  


What about the Democrats you say?  Evidence suggests the ideological left wing, while it certainly exists in this country, has never come close to the kind of power the ideological right has achieved.  Unlike many Western European countries we have never had anything like socialist control of any branch of government.  We have had a number of periods when Democrats controlled both house of Congress and the Presidency, and those periods saw the passage of Social Security, LBJ's great society, and the creation of lots of consumer and environmental protection legislation, but the periods where Democrats have controlled all branches of Government also included the years during WW I, WW II and the Korean War where big legislative initiatives were on the back burner.  For whatever reason, no pattern of disaster following Democratic control reveals itself.  


I also personally believe the nature of right and left ideologies makes Democrats in the United States less extreme in their views.  Republican ideas are rooted in self reliance and personal responsibility - they are focused on what is good for the individual, and heavy with overtones of "leave me alone so I can do what I want".  They flow easily from the values from our pioneer heritage, so as a nation we are inclined to be sympathetic to those values.  The middle of the road in the United States is actually to the right of center by the reckoning of many other countries.  But the frontier is gone.  Most of us can't walk out the back door and go shoot our dinner, or chop up a downed tree to keep us warm.  We can't get up and move because we now have a neighbor a mile away and we want our space.  We are town folk, heavily reliant upon each other.  Democratic ideas are rooted in that interlinked nature of society, in the common good, in shared responsibilities and tolerance.  Democrats think consensus is a value in itself.   Republicans think winning is the only value.  So even when Democrats are in control Republicans have more influence than when the reverse situation exists.


In a functioning modern society you need both these views.  They each have strengths and weaknesses and should be complementary rather than mutually exclusive.  We need the selfishness that is at the root of Republican ideology because that is what drives much of our economic development.  But Republicans often regard government as at best a nuisance (excerpt when they getting subsidies) but in fact Government plays a key role in creating a society that allows our culture and economy to thrive.   We need the sense of group identity, or group responsibility, that underpins most Democratic ideology.  


That's this Armadillo's view.

Monday, May 30, 2011

The rewards of being "tough on crime"

For the last 35 years or so a lot of politicians have built careers on being "tough on crime".  The ideas resonated so well with voters it got to the point where no politician who valued his career would question whether the tough on crime measures, which usually mean putting more people in jail for longer periods, actually reduced crime.


Academic studies have identified factors that clearly correlate with the level of crime.  Most crime is committed by young men between (roughly) 15 and 25 years old.  When there are more of them around, crime levels go up, when the 15 to 25 year olds are a smaller percentage of the population, crime levels go down.  The better policing techniques developed in the last couple decades strongly correlate to reduced levels of crime.  But  to my knowledge no study has been able to conclusively show a link between incarcerating more people for longer and a long term reduction in crime levels.


"Tough on Crime" supporters argue if criminals are off the street they can't commit crime.  Intuitively that seems true, but evidently for that to work you have to incarcerate every criminal for life because as law enforcement professionals and criminologists have noted for years, sending people to prison is like giving them a scholarship to crime graduate school.  If those 15 to 25 year old young men aren't career criminals going in they probably will be coming out.


What is crystal clear about our decades of being tough on crime are the enormous negative consequences.  Being tough on crime was politically popular nationwide (although California seems to have done it best as we incarcerate a higher percentage of our citizens than any other state).  As a result the United States, the "land of the free", incarcerates a higher percentage of its population than any other country in the world.  The worst dictatorships in the world - countries like Cuba or North Korea - incarcerate a smaller percentage of their population.  Countries that fill their jails with political dissedents - countries like Russia, Iran, China, or African dictatorships, all incarcerate a lower percentage of their population than we do.  Advanced democracies that we think of as like us, like Canada, Japan, European countries, incarcerate about 1/3 as many people, as a percentage of population, as we do.  Mexico only incarcerates about 1/3 as many of its citizens as we do, by percentage of population.


How do we explain this?  Are Americans inherently more criminal?  Or is our approach to crime wrong?


The "tough on crime" approach of the last 35 years has unequivocally changed the nature of our society.  We were closing libraries, parks, counseling services, after school programs, and cutting funding for education as we happily threw money at building new prisons.   A few years ago we reached a noteworthy milestone where we started spending more money on prisons than we spent on higher education.


If you are reading this and busy thinking of all the reasons I am wrong, please explain to me how the following statistic (which you can easily verify in a couple minutes of research) makes any sense whatsoever:


There are about 10 employees of the California Department of Corrections that were paid more than $500,000 in 2010.  


Just to provide a little comparison, the President of the United States is paid $400,000 a year.  The Chairman of the Joints Chiefs of Staff, the man responsible for running the largest and most respected and successful military service in world, makes around $250,000 a year. 


Why do we spend more on Prisons than we do on higher education?  Why do the people who run our prisons make so much money?  Because the Prison Guards Union supported and contributed to "tough on crime" politicians,  who in turn rewarded that support.


The legacy of the past couple decades of being "tough on crime" has been to trade hope for fear, and opportunity for punishment.