If you’re worried about the state tracking your phone calls, as it’s apparently been doing for years, how would you feel about it playing with your head?
Yet, that is essentially what some policy-makers are proposing to do in “nudging” us into making what they consider better choices. Since we’re no good at it, they want to shape our decisions for us. You see, as free citizens, we’re making a mess of our lives and the planet. We eat and drink too much. We don’t save enough and waste tons of energy. We’re just plain lazy about figuring out what’s best for us.
But don’t worry. The nudgeniks intend to save us from ourselves. By enlisting the theories of behavioural economics, they say they can get us to act in our own best interest. What’s more, they say they can do it without resorting to heavy-handed regulations or taxes. So, what’s not to like?
U.S. President Barack Obama, British Prime Minister David Cameron and New York Mayor Michael Bloomberg are big fans of nudging. And now comes news that bureaucrats at the Department of Finance are considering nudging Canadians – for our own good, of course.
The nudgenik-in-chief is Cass Sunstein, a Harvard Law School professor who served as Mr. Obama’s regulatory czar for three years. Mr. Sunstein co-wrote the book on nudging, (appropriately entitled Nudge, authored with University of Chicago professor Richard Thaler). And during his short White House stint, he claims to have brought about a “large-scale transformation of American government.”
In reality, Mr. Sunstein’s most lasting legacy may have been to do away with the food pyramid.
“We now have a food plate, which is more intelligible, and we believe it’s leading to more informed choices,” he recently told Britain’s New Scientist magazine.
Indeed, despite their enthusiasm, the nudgeniks have so far overpromised and under-delivered. We should probably be grateful for that, since, as their schemes gain in complexity, they increasingly risk crossing the line into outright manipulation. We need to stop them before they get really carried away.
That’s because nudging only truly works when we’re unaware of it. Once we’re on to the fact that some faceless policy-maker is shaping our decision-making process, we’re more apt to resist their attempts to direct our behaviour. There is a tradeoff between the transparency and the effectiveness of nudging that the nudgeniks seem disturbingly unperturbed about.
“I don’t think it’s very important that people support the idea of nudging in the abstract,” he told New Scientist. “I think it’s important that policies be helpful and sensible.”
But who gets to decide what’s helpful and sensible? Is it Mr. Bloomberg? He is still trying to ban large-sized sugared soft drinks in his city by appealing a recent court decision that called the ban “arbitrary and capricious.” Limiting the size of sodas served in restaurants and movie theatres is a form of nudging. It’s based on the idea that people only consume mega-sized soft drinks because they’re there.
This is what the too-clever-by-half nudgeniks call “libertarian paternalism.” Although the state decides what’s in your best interest, by not banning sodas outright, it preserves your freedom to buy multiple, smaller sugared soft drinks. It’s betting you won’t go to the trouble of ordering more than one.
But as Adam Burgess of the University of Kent noted in a 2012 paper in the European Journal of Risk Regulation, nudging of this sort “assumes a fundamentally pliant and passive population that attaches limited value to individual liberty and autonomy.”
Mr. Bloomberg’s other big nudge – forcing fast-food chains to post calorie counts on their menus – is also based on the oxymoronic principle of libertarian paternalism. If the aim was only to provide information, there would be nothing objectionable about it. But the policy gurus who came up with the idea figured McDonald’s patrons could be shamed into picking lighter options.
Guess what? It doesn’t work. A study by researchers at Pittsburgh’s Carnegie Mellon University, published last month in the American Journal of Public Health, examined 1,121 lunchtime diners at two New York McDonald’s outlets and found no link between posted calorie counts and ordering behaviour. One possible reason for that, lead author Julie Downs told NBC News, is that “the people who set these policies aren’t very representative” of the people whose behaviour they’re trying to influence.
Indeed, nudgeniks seem to think everyone has the same cognitive biases as them.
But as Prof. Burgess noted, “American schemes using nudge to reduce electricity usage are dependent upon political values. Unsurprisingly, whilst it works with liberals, it can backfire with some conservatives … Those unwilling to be nudged might be significant, even a majority.”
Ottawa would be wise to keep this in mind as it contemplates “nudging” Canadians into saving more by automatically enrolling them in pooled pension plans or a supplementary Canada Pension Plan. Workers could opt out if they want, but the nudgeniks pushing the idea figure most of us would be too lazy to bother.
We might surprise them. Nothing annoys us more than being manipulated by those who think they know better than us.