Central Planning By Any Other Name...
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Harvard economist Greg Mankiw:
Here's what confuses me about manipulative government paternalism such as "getting Americans to save more": Why precisely is it so "difficult"?
If "enlightened" economists, and the politicians who hire them, really believe that Americans should save more, then why not just flat-out require it? Just force people, at the point of a gun, to save -- just as we force people, at the point of a gun, to pay taxes. Why pussyfoot around with 401(k) opt-in defaults and tax-exempt bonds and the "Save More Tomorrow" gobbledygook that Mankiw mentions?
What's that you say? People don't like being forced to do things at the point of a gun? But if that's true, then why think that they like being manipulated through public policy and social engineering programs either?
If you're going to be a central planner, then at least have the intellectual and political honesty to acknowledge it openly rather than cloak yourself with bait-and-switch terminology like "enlightened paternalism" or "behavioral economics" or "happiness research."
But stop trying to convince yourself, and us, that government manipulation is any different in principle from government coercion.
Many economists believe that it would be desirable for Americans to increase the fraction of their income that they save.The rest of Mankiw's post is ballast.
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The difficult issue is how to get Americans to save more.
Here's what confuses me about manipulative government paternalism such as "getting Americans to save more": Why precisely is it so "difficult"?
If "enlightened" economists, and the politicians who hire them, really believe that Americans should save more, then why not just flat-out require it? Just force people, at the point of a gun, to save -- just as we force people, at the point of a gun, to pay taxes. Why pussyfoot around with 401(k) opt-in defaults and tax-exempt bonds and the "Save More Tomorrow" gobbledygook that Mankiw mentions?
What's that you say? People don't like being forced to do things at the point of a gun? But if that's true, then why think that they like being manipulated through public policy and social engineering programs either?
If you're going to be a central planner, then at least have the intellectual and political honesty to acknowledge it openly rather than cloak yourself with bait-and-switch terminology like "enlightened paternalism" or "behavioral economics" or "happiness research."
But stop trying to convince yourself, and us, that government manipulation is any different in principle from government coercion.
Posted by Kip on
28 June 2006
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