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Franklin Foer and Noam Scheiber take a look at Barack Obama’s attitude towards the political economy. The economic crisis dwarfs the other crises that Obama inherited, and his engagement of economic issues remains rather puzzling. But I think Foer and Scheiber are well onto the philosophy and process angles of this puzzle, and their piece is an essential read:
There are no grand theorists in the Obama orbit, certainly no in-house ideologists. During the campaign, Obama sold himself as a green-eyeshade pragmatist, insisting every one of his proposals was “paid for.” But, in fact, there is, if not an ideology, then certainly a sensibility that reigns in Obamaland. Perhaps the easiest place to see it is in the administration’s fondness for behavioral economics, the branch of the dismal science that recognizes that humans aren’t utility-maximizing automatons, but flawed creatures who often screw up simple calculations and struggle with self-control. The key behavioral insight is that the way we frame choices matters enormously. Take a classic behavioral example: pensions. In a fully rational world, everyone would enroll in their company’s 401(k), which provides a financial incentive to save for retirement. In the real world, we frequently put off enrollment, not wanting to weigh all the confusing options or fill out tedious paperwork. If, on the other hand, our employer enrolled us automatically but allowed us to opt out, most would stick with it. Simply by changing the “default” option from out to in, we improve workers’ welfare without limiting their freedom.
[Richard] Thaler and [Cass] Sunstein have dubbed this policymaking approach “libertarian paternalism,” and it was highly influential within the campaign. For example, in addition to the retirement saving reform, which Obama later wrote into his budget, the campaign also warmed to a proposal called “intelligent assignment.” The idea was a response to the fact that seniors enrolled in the Medicare prescription drug program are often overwhelmed by the dozens of plans they have to choose from, sometimes to the point of paralysis. The Obama wonks favored automatically enrolling many of them in the plan that best suited their needs, based on their drug-buying histories, then allowing them to switch if they found one they liked better.
In the grand scheme of things, these “nudges” were minor tweaks designed to elicit more rational behavior. But, in many respects, what the Obama administration has done these last few months is simply scale up the logic of nudging, albeit massively. Not all of Obama’s nudges fall out of behavioral economics, per se. Some involve changing incentives to encourage certain activities and discourage others. Some involve fostering competition to trigger innovation. But, as in the behavioral examples, the Obamanauts typically have an outcome they want to promote. And, like the behaviorists, they instinctively recoil from imposing it unilaterally. So, instead, they monkey around with the choices people face, seeking to influence decision-making rather than mandate decisions.
More from Scott Horton:
Conversation — August 5, 2016, 12:08 pm
Sidney Blumenthal on the origins of the Republican Party, the fallout from Clinton’s emails, and his new biography of Abraham Lincoln
Conversation — March 30, 2016, 3:44 pm
Joseph Hickman discusses his new book, The Burn Pits, which tells the story of thousands of U.S. soldiers who, after returning from Iraq and Afghanistan, have developed rare cancers and respiratory diseases.
Years ago, I lived in Montana, a land of purple sunsets, clear streams, and snowflakes the size of silver dollars drifting through the cold air. There were no speed limits and you could legally drive drunk. My small apartment in Missoula had little privacy. In order to write, I rented an off-season fishing cabin on Rock Creek, a one-room place with a bed and a bureau. I lacked the budget for a desk. My idea was to remove a sliding door from a closet in my apartment and place it over a couple of hastily cobbled-together sawhorses.
Age after which Mick Jagger has said that he’d “rather die” than still be performing “Satisfaction”:
A bioengineered lacrimal gland was successfully shedding tears.
Investigators found that a surgeon in Massachusetts accidentally removed a kidney from the wrong patient, and a former mayor in Thailand was given a six-month prison sentence for kicking his doctor in the neck.
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“Matt was happy enough to sustain himself on the detritus of a world he saw as careening toward self-destruction, and equally happy to scam a government he despised. 'I’m glad everyone’s so wasteful,' he told me. 'It supports my lifestyle.'”