The Persistence of Poverty

by on August 7, 2007 at 6:16 am in Economics | Permalink

…paying the first bill in a stack of overdue bills does little to relieve a guilty conscience.

That is from Charles Karelis’s truly intriguing The Persistence of Poverty: Why the Economics of the Well-Off Can’t Help the Poor.

If your car has lots of scratches and dents, getting rid of just one doesn’t help much either.

More generally, if pains and troubles are high enough, extra pain and trouble just isn’t so bad.  You hardly notice it.  But that overturns standard economic assumptions of diminishing marginal utility, and the rest of Karelis’s model follows directly. 

Poor enough people will accept risk in the downward direction rather than smoothing consumption, so they buy lots of lottery tickets.  They also commit more crime, so they can have at least some joyous times, and they take lots of "stupid" chances.  Yet the poor are not irrational or necessarily dysfunctional in terms of procedural rationality, but rather they are optimizing given constraints.  They are taking the Friedman-Savage model very very seriously.

"Getting tough" with the poor through policy is more likely to backfire than succeed, as it just encourages more mean-reducing, risk-taking behavior.  At some level the marginal utility of consumption for the poor fits the standard model, so income effects will more likely bring normal behavior than will substitution effects.  That’s one reason why the EITC works relatively well.

The more the poor regard themselves as lagging the rich (rather than doing better than, say, their peers back home in Gujarat), the more stupid risks they will take.  That’s why poor immigrants are more value-maximizing than the poor that have lived in America a long time and adapted to American norms and expectations.  The immigrants don’t regard their burdens as insuperable and they are on standard downward-sloping marginal utility curves.

It can make more sense to give money to people on the verge of leaving poverty, rather than people deeply mired in poverty.  The former transfer will get people onto "normal" marginal utility curves, but the deeply poor will just squander their new wealth, as it doesn’t much alleviate their unhappiness.

This short book is a wild ride.  The absence of traditional evidence makes it hard to evaluate these hypotheses, but it is one of the more valuable and stimulating contributions of the year.

Andrew Flowers August 7, 2007 at 7:08 am

Fantastic post!

mcwop August 7, 2007 at 8:23 am

Come to Baltimore. Stubborn crime and poverty. In this case, one cannot even blame it on Republicans, as the state (and city) is overwhelmingly run by Democrats, and is one of the wealthiest state’s in the US.

Giedrius August 7, 2007 at 9:22 am

If you define poverty in relative terms (such as bottom 10% of income), then you cannot make someone “leave poverty” without pushing someone else into it. And if you define it in absolute terms (PPP adjusted), then what about the folks in Gujarat (or 19th century for the matter)?

shawn August 7, 2007 at 10:10 am

So then, if your neighbors, your friends, people you see on TV are noticeably richer than you, and you can see no way to get to their level, you’re pretty likely to give up, rather than taking steps to be more like ‘that nice family down the street’?

Well, that explains rap.

irtisaam August 7, 2007 at 10:58 am

“That explains rap”? I really wonder if a musicologist would arrive at the same ignorant, dismissive, and likely bigoted, conclusion.

Bill Harshaw August 7, 2007 at 11:04 am

Sounds interesting. I like the strategy of analyzing the behavior of people as if they were rational. It’s not true, but it should work as well for the poor as for hedge fund managers.

shawn August 7, 2007 at 11:47 am

Might someone dismiss the ‘that explains rap’ comment as racist? Perhaps. Might someone believe that the prevalent ‘rob to get ahead, and as the only way to get ahead’ theme in rap is related to these very themes of “a too-scratched car” and “commit more crime, so they can have at least some joyous times”? More likely.

Or, is any criticism of a form racism?

Anderson August 7, 2007 at 11:57 am

where below that point, they’ll only squander the money

Where “squander,” I guess, means “buy something one needs, rather than paying one of the 100-odd debts one owes.”

I don’t think you can talk about poverty meaningfully while still using words like “squander.” Indeed, I had thought that was one of the points of the book under discussion.

hrh August 7, 2007 at 12:00 pm

hmmm:

The EITC affects a large fraction of the workforce. Depending on family size, one can earn $30K per year and still be getting something from the EITC. Also, EITC disbursements are increasing in income until a nontrivial earingings threshold (It’s on the order of $10-15K depending on family size*), afterwards there is a phase-out region. Thus the two paragraphs make sense if people earning $15K or so per year can be said to be “on the verge of leaving poverty.”

*See http://www.econ.ucdavis.edu/faculty/hoynes/working_papers/TaxPolicyEconomy_ConferenceDraft.pdf page 22.

eric August 7, 2007 at 12:11 pm

If impatient, self destructive behavior is rational, I guess everything is rational. Discipline, hard work, that’s a preference, like preferring the color blue over green.

Steve Sailer August 7, 2007 at 12:46 pm

The worst problem with being poor in America today is not that you can’t afford to buy enough stuff but that you can’t afford to get away from other poor people.

Jacqueline August 7, 2007 at 1:36 pm

Anyone who objects to the use of the term “squander” to refer to how many poor people spend windfalls and other extra money needs to spend more time with actual poor people. I’ve never seen so much drinking, smoking, and marijuana use than in the homes of poor people living off of welfare and/or disability, housing assistance, and food stamps.

Another great example: A woman who used to work with me complained frequently about her teeth and how they hurt and blamed them for why she couldn’t eat healthy food and thus was morbidly obese. She also had difficultly getting to work reliably because her car had broken down and she didn’t have the money to fix it. When she received a large year-end bonus she spent it on buying a set of very fancy bowling balls instead of on going to the dentist or fixing her car. Also, she complained that she couldn’t afford to buy health insurance, but she seemed to have plenty of money for parties, fireworks, her cell phone, and getting new tattoos.

Richard August 7, 2007 at 1:59 pm

Good article,

“Consider only macro policies and ignore the fact the public is made out of people.”

My mother thinks I’m a heartless b*****d since I sided with my dad’s employer when they modernized, causing my dad to loose his job. I was trying to explain to her that society was now better off because the plant’s economic output, per unit of labor input, had gone up. The workers who lost their jobs (and they did receive a modest buyout packages) were now free to work elsewhere with no loss in production at the plant. Any additional work they did decide to do translated into a net, per capita, increase in economic output for society. She didn’t appreciate my analysis.

John Dewey August 7, 2007 at 2:14 pm

robertdfeinman: “By the way, I’m willing to state that the US can currently afford to eliminate all those living a sub-standard life style.”

How do you propose we do that, Robert?

We’ve been redistributing wealth to the poor for at least 40 years now. And we’ve successfully created a culture of dependency. We failed when we took charity out of the local institutions and created state and federal programs.

Fred August 7, 2007 at 2:39 pm

In a long term non scientific study, i.e. looking at the kids I grew up with in the fifties, I find that the impulsive, aggressive, and not too bright haven’t done as well as the good kids. Being bright was a bonus to some of the good kids but, being a good kid and average was enough for a successful life.

John Dewey August 7, 2007 at 3:11 pm

Robertdfeinman,

Not too many things really piss me off. But one of them is the way liberal idiots try to assume they have some right to the name my parents gave me – just because some long-dead philosopher that no one cares about happened to have the same name.

My last name has been owned by my ancestors for at least 300 years and probably much longer. There are tens of thousands of people with that same last name.

My first and middle names were given to me to honor my two uncles. These men were pilots in World War II who gave their lives in defense of their country – so that even liberal do-gooders such as you can continue speaking your mind.

If it offends you that my name – which honors two dead patriots and generations of my family – is the same as some useless hero of yours, well, sir, you can kiss my A**.

Shirkuh August 7, 2007 at 3:18 pm

Cowen (or Karelis) is close to some of the stuff Becker/Murphy and Becker/Mulligan have done, but not quite as stringent.

1. The first part is about convex utility functions. I think this is what Cowen means where he writes they understand Friedman-Savage too well. Obviously an F-S utility function can be convex, we only assume it’s usually not. You could explain a lot of poor people behavior by assuming they have convex utility in the relevant regions, even rationally so.

It is completely wrong to think “If your income < < c(0), a marginal increase doesn't have an effect†, in a world where you have uncertainly. However below E(c(0)) the rational agent will become risk loving (convex preference function). This is by the way known from evolutionary biology. An animal that is starving should and does tend to go for 10% chance of killing a pig pray instead of a 100% chance of killing a small pray that will not last him until the next hunt.

The implication is not that the poor will stop caring altogether, only that they go for the small probability-life altering get quick rich track, instead of the more positive expected value decision. That includes both lotteries AND as someone pointed out the rap culture (“Get rich or die trying†).

http://ideas.repec.org/p/fth/chices/160.html

http://ideas.repec.org/a/ucp/jpolec/v113y2005i2p282-310.html

2. While much of the behavior fits the theory the application to American poor is actually wrong.
The poor do act as if they have convex utility functions, but not because it makes sense for them (it doesn’t), but due to bad norms, weak cognitive abilities and a high discount rate.

http://ideas.repec.org/p/fth/chices/98.html

In fact poor Americans are not starving, and easily could drag themselves out of poverty, if they wanted to. The “rationally risk-loving† poor behavior may be true for people who are starving or who have no reasonable chance to improve their lives in time through work and savings. This is not true for unskilled American poor, who have a reasonable chance of earning 15-20.000 dollars per year, more than enough for a decent life compared to 80% of the planet.

Paying the first overdue bill seems meaningless to some people because of low consciousness, they can’t imagine and take into account the future, or follow norm-based rules that act as a proxy. Hardwiring the rule “always pay your bills† into your preference function is pretty important for low skilled people who can’t rely on their abstract rationality.
But the poor today have had these bourgeois norms eradicated. With the norms transmitted by peers (as Sailor points to) the poor re-inforce each other’s bad behavior and bad priorities.

3. “Yet the poor are not irrational or necessarily dysfunctional in terms of procedural rationality, but rather they are optimizing given constraints.†

The problem here is that this constraint is not external, but endogenous. The poor can be taught to be rational and not just maximizing. Giving them incentives to work is a good start. “Getting tough† can very well work, since the problem was never the low income to begin with, but the short time horizon and bad preferences.

What Cowen also ignores is this: the poor are NOT below zero utility. Starvation is not the margin they are behaving idiotic around. They are doing it somewhere above industrial country subsistence level and middle class incomes (say between 10.000 and 40.000 k per year).

Very few people buy lotteries if they are hungry. They buy lotteries instead of paying the phone bill after they have paid for food, some housing and other minimal requirements.

4. “That’s why poor immigrants are more value-maximizing than the poor that have lived in America a long time and adapted to American norms and expectations.†

Wrong wrong wrong. It was never the low consumption level or comparison with the rich that caused the bad norms among American poor. The bad norms caused poverty.

The 10% or so poor in the US are a self-selected group, that couldn’t make it despite external opportunity due to bad norms, weak character or low IQ (obviously the three enforce each other). The poor from India are really the opposite, those with particularly good norms. The behavior and mobility of poor immigrants *shows* material povery is in itself not self-reinforcing (unlike povery of value).

Let me use another example: Americans 100 years ago. They were materially poor, and yet quickly rose from poverty through hard steady improvements, the method that works the best. The income inequality was higher back than, and they were hardly comparing themselves with Indians (remember 90% were US born).

5.
“The absence of traditional evidence makes it hard to evaluate these hypotheses,†

You should look at economic and psychological experiments regarding self-command. The poor/low IQ tend to have the postpone small consumption even briefly for small rewards. This indicated the convex utility function theory is wrong (waiting for another candy-bar will not make you rich, so it can’t explain 50% discount rate per day).

Anderson August 7, 2007 at 3:52 pm

the US can currently afford to eliminate all those living a sub-standard life style

Now, *that* would be harsh. And probably unconstitutional.

mpowell August 7, 2007 at 4:06 pm

I noticed that too, Anderson :). An unfortunate slip, there. Honestly, I’d just like to see decent healthcare, a better minimum wage and an end to the war on black people(drugs). And hopefully not by elimination. If we could get those, well, then we’ll see.

thehova August 7, 2007 at 4:34 pm

John Dewey does not strike me as being too liberal.

he belonged to a small group of intellectuals who actually took a firm stand against communism.

and although Hegel and even Marx fascinated him, at heart, he was a Lockean.

John Dewey August 7, 2007 at 5:36 pm

robertdfeinman: “I suggest you read one of his more accessible works “Democracy and Education”"

I suggest you read Thomas Sowell’s “Race and Economics” or “The Vision of the Annointed”, and get a real education. Perhaps you may realize somewhere along the way that being a talented artist doesn’t make your condescending suggestions any more welcome.

sidereal August 7, 2007 at 6:35 pm

“the prevalent ‘rob to get ahead, and as the only way to get ahead’ theme in rap is related to these very themes of “a too-scratched car” and “commit more crime, so they can have at least some joyous times”? More likely.”

Don’t listen to much hip-hop, do you? Most of it is about getting laid and getting respect, sort of like the music of Elvis and Johnny Cash. Course, they were white. . .

robertdfeinman August 7, 2007 at 7:44 pm

John: Thanks for taking the time to read my goals essays, but I don’t support socialism. I don’t know what would make you think that. Government regulation of markets is not socialism which is government ownership.

I don’t consider programs like Social Security and Medicare as government owned. I consider them as government-administered. The money is collected from special taxes, put into a special fund and reserved for a specific purpose. How it is paid out is determined by the enabling legislation. The government just performs the clerical tasks of collection and disbursement.

I favor entrepreneurship in a democratic society. Only entrepreneurs (or those acting like them) innovate. Established firms only innovate in response to competition, otherwise they prefer to try and control the market to maximize their profit.

Only democracy allows people to control their own destiny. This permits mistakes, but I can’t think of a better approach. The philosopher-king hasn’t worked out too well in practice.

Having said all that, I still think that the world will need to transition away form the capitalist/consumerist/growth model currently in favor. I don’t know what the new model should or would look like, but I don’t think it is out of place to hold discussions about the topic.

jacob August 7, 2007 at 9:18 pm

@robert

Not Socialism. That is a sad joke, and its even sadder still if you believe it. Tell me when do I get to choose to contribute or not? Oh wait I don’t. I get robbed, and compelled against my will to fund someone elses life. How is that not socialism? If it isnt socialism, how about government sponsored slavery. We tax labor in america. Labor is the life I lease to someone else. So Social security STEALS MY LIFE, the very time I am born with. Its the most hateful crime against humanity outside of full bondage. Instead we just graze off the top just enough. Its not even slavery, slavery does not do it justice. Its human agriculture.

joeo August 7, 2007 at 9:37 pm
John Dewey August 8, 2007 at 12:19 am

JSK: “@John Dewey: Relax. It’s just a name which happens to be yours.”

Yeah, well I guess I did overreact. I don’t care that much about the undesirable name association. I just really get irritated with do-gooder liberals who want to take my hard-earned money and give it to some “disadvantaged” drug addict – especially when such a liberal directs a sentence toward me that starts “You do realize …”.

shawn August 8, 2007 at 7:49 am

@ sidereal

“don’t listen to much hip hop, do you?”

yep, I do, among a lot of other things…though, I have more gangster rap (50, eminem, obie trice, boyz), which would tend to skew my perceptions that way. …I’m kinda surprised that you wouldn’t think that crime is a large percentage of the source for rap.

As a professor of mine once said, “you can’t say everything when you say anything. If you try, you won’t say anything, because you’ll be saying everything else.”

You can’t say everything that every rapper is writing about, and I’m not trying to. The themes that I talked about are there and are at least widespread enough to be known (they’re certainly not fringe incidents by one or two guys). We can argue about the percentage of rap that have ‘rob to get ahead’ themes, but that’s not really the point.

Is it, or is it not, true that that’s a theme in rap? Does it, or does it not, interestingly correlate with this article?

“Well, that explains rap.” = “Well, I can see those themes in rap music.”

It’s utterly irrelevant if some of the themes are also sung about by white singers like Cash and Elvis (of which I have neither).

TGGP August 8, 2007 at 11:24 am

robertdfeinman, I just came across this, and it is pretty interesting. It fits with the variance explanation.

Louis Proyect August 8, 2007 at 12:06 pm

In the 1980s, when Wall Street yuppies were at their most obnoxious, they were fond of lecturing homeless beggars why they would not advance them a penny. Odd that a tenured professor would encapsulate the same boorish mentality.

robertdfeinman August 8, 2007 at 12:48 pm

The dictionaries I just consulted pretty much give this sort of definition:
Socialism:
“a theory or system of social organization that advocates the vesting of the ownership and control of the means of production and distribution, of capital, land, etc., in the community as a whole.”

If you want to create your own definition for the term you will have to explain what it is.

Libertarians may think that they can do better by doing things on their own and avoiding communal structures like Social Security, but we have a democracy and over time the people have decided that they prefer to dedicate part of their earnings to a government-administered insurance program.

This is just the way democracy works, not everyone is happy with the decisions of the majority, but that is one of the “defects” of democracy – the “tyranny” of the majority.

If you have a solution to this defect, please enlighten the rest of us.

TGGP:
I frequently use Lee as a successful example of a philosopher-king. What the people gave up for rapid economic growth was the ability to participate in politics or policy making. The defect is that the choice of the next leader is made arbitrary. So one can just as easily end up with a Mugabe as another Lee.

I still hold out for democracy, warts and all.

shawn August 8, 2007 at 3:25 pm

Nathan…doesn’t your lending example assume that the ‘late payer’ will actually eventually be a ‘full payer’? As in, they won’t default completely on the loan, or enter bankruptcy?

And…I’m glad your Dad’s not coaching us anymore. :) (Sorry, stupid UF joke there)

Jane2 August 8, 2007 at 8:25 pm

And I just read the post claiming there are nearly no poor people in this country. Come on! You need to get out more before you post, your ignorance is embarrassing.

TJIT August 8, 2007 at 10:56 pm

robertdfeinman,

The poor would probably benefit if more effort was spent trying to figure out how to move them from engaging in personally destructive behavior and less justifying said destructive behavior.

Nathan Zook August 9, 2007 at 8:43 am

Jane2: I’ll say it again. There is almost no poverty in this country by historic or even global standards. Even my definition (being chronically uncertain about the source of your next meal) is probably high. Historically, the poor suffered chronic malnutrition (not due to eating junk food). If you think that this standard is met by a significant number of people in this country, then it is YOU who need to get out. Out of Hollywood and collective pipe dream of the left. I made a conscious decision to remain poor rather than to avail myself of government handouts because in my view a young, healthy, single adult male had no business accepting such money. That is, I was not willing to stoop to thievery. Ten years later, I met another man who was in the middle of a similar situation. He actually was malnourished.

The definition we use for “poor” in this country includes having a TV, car, and cell phone. Give me a break. It is effectively impossible to be poor by historic standards if you are on welfare in this country.

robertdfeinman August 9, 2007 at 10:59 am

jacob:
You are so caught up in repeating the libertarian bullet points that you avoided discussing the way democracy works. I went into this in detail.

The majority creates the rules for society. Those who don’t agree must take their lumps. If you feel that the social security tax is a forced taking you have several choices, you can move to a country without any such forced takings (if you can find one), or you can use the mechanisms of the democratic process to get your ideas adopted as the law instead.

As 70+ years of experience have shown, your vision continues to be rejected by the vast majority of citizens which is why social services continue to expand over the decades.

Perhaps it is unfair, perhaps SS should be voluntary, but this is what we have and you can rant all you like, but to what end?

robertdfeinman August 9, 2007 at 12:31 pm

Jacob:
Exactly which system are you talking about that “could not trample on the rights of the minority”?

Do you mean the US? The US has lots of road blocks to prevent rash actions, but they are not fool proof. A determined group can pretty well get anything enacted it wishes, it may just take a bit longer. The hope of the founding fathers was that cooler heads would prevail before the worst was enacted. They were only partially successful.

So please explain in more detail. Do you feel that the US tramples the rights of the minority? If so how would you remedy this? Can you point to a society which does a better job that we can learn from? Which democracies have ended up in violent chaos? Chaos usually arises in nominal democracies like the Philippines under Marcos where there were only rigged elections.

I’m having a problem understanding your point.

robertdfeinman August 9, 2007 at 2:03 pm

TGGP:
This has gone on too long to make the thread easy to follow, but one more time.

There is more to a democracy than that it holds elections. There is the rule of law and the mechanisms to ensure that it is adhered to. Germany under Hitler was not a democracy. The “law” was enforced by brown shirts and the legislature a rubber stamp. Hitler wasn’t even elected.

I’ll point you to the writings of the legal philosopher Franz Neumann. Here’s a quick version of his principles for the rule of law:

1. All men are equal before the law.
2. Laws must be general, not specific (this rules out bills of attainder).
3. Retroactive laws are illegitimate.
4. Enforcement must be separate from the decision-making agencies.

I think you will find that Germany didn’t follow these and neither does Singapore.

I think dragging in Germany is a red herring. Let’s stick to the US. The majority has caused social service activities to be adopted as a government function. You don’t like this. What are you going to do about it?

robertdfeinman August 9, 2007 at 4:21 pm

Yancey:
Actually I think the US is violating all four, I even wrote an essay on this:

Saving Democracy

Yancey Ward August 9, 2007 at 4:30 pm

Robertdfeinman,

So, you think progressive taxation is a violation of principle #1?

Yancey Ward August 10, 2007 at 9:44 am

Robertdfeinman,

Your definition of “equal before the law” is nonsense, which explains some of your other positions regarding democracy and a host of other issues. You are not attempting to live by a principle, but defining the principle to suit your own views. A system where I give up 50% of my work time to the state while another gives up only 10% is inherently unequal before the law. It is clear that you view “equal before the law” as whatever the majority wants it to mean, as long as you are part of that majority. It leaves one with no recourse for dissent, and, by the way, explains your frustration with libertarians. Libertarians are more interested in a priori principles, especially freedom from coercion. Such principles do not have their foundations in the quicksand of majoritarian will. You really should reflect on the silliness your admonitions to libertarians to stop holding out for their ideals- it reveals a shocking degree of immaturity that is exactly identical to the command “shut the f**k up”.

Yancey Ward August 10, 2007 at 1:15 pm

Robertdfeinman,

Where did I spew obsenities? I was comparing your insistance that libertarians stop their advocacy of their positions to what an earlier commenter told you. Why don’t you learn how to read before spouting off.

However, the first principle you laid out requires that each man be equal before the law. You then immediately made an exception that the law treat differently men of different means. How can one complain that the law treated the aristocracy differently from the common man, and then proceed to advocate exactly the same thing, but now based on one’s income? One might as well accept that the law treat a black man differently from a white man because they are not “in the same situation”. In other words, you have a principle made out of clay- malleable to fit any situation one desires. Or, I would describe it as no principle, whatsoever.

Gina August 10, 2007 at 4:22 pm

You should advise the current administration. . . .

TGGP August 11, 2007 at 1:12 am

Nazi Germany was not a democracy. Why do you pretend otherwise?
It’s a reductio ad absurdum. You justify certain policies (like Social Security or progressive taxation) on the support for them on the part of the people. I show that line can justify Nazi policies I already know you find abhorrent. From that you can conclude that popularity does not justify policy, so we must shift to examining the policy itself. Mein Kampf was a huge best seller. Hitler’s party gained a plurality of seats in normal democratic fashion, attained a majority through the standard proportional-parliament method of a coalition (as did Allende, whom we never forget was popularly elected) and remained immensely popular with the Germans throughout his tenure. All the plebiscites annexing more territory were immensely popular with the voters, who after all were ethnic Germans. The main opposition to annexation in Austria were the fascists, who held the power and didn’t want to be replaced by the Nazis!

There is a large literature of intellectuals who fled Germany and went on to use their experience and study of the period to formulate political philosophy.
I’m most familiar with the Austrian School and Erik von Kuehnelt-Leddihn, but probably more famous are the Frankfurt School. I think we (and Popper) can both agree Marxism is absolute bunk and skip over them.

Let’s assume the you and I agree an some ethical norms.
As an emotivist, I don’t believe norms have any truth-value. Saying “X is good” is like saying “Hooray X!”. It is a sentiment that disagreements over cannot be settled objectively. I try to be Bayesian-rational and gain more information to correct my false perceptions about the world. That is one reason why I read a lot. Because I don’t believe in normative truths I cannot believe I hold false normative beliefs or that there are any true ones I need to learn, so I have less incentive to read philosophy, which I regard as largely devoid of truths. This position (which post-dates my libertarianism but coincides with my loss of faith in God) deprives me of the defense of capitalism on the basis of virtue rather than efficiency, as Albert Jay Nock and Frank Knight (along with others, but I’m not sure which of them weren’t also confident in its efficiency) made. If you want to change my mind about something, it would best be done with data about the world I was unaware of or an analysis that would give me an additional perspective on such data.

Something about all men are created equal and the like.
That sounds like a positive rather than normative statement. I’ve taken far too many mathematics courses to throw around the word “equal” that loosely. In geometry we even had to put squiggly lines over any equals sign because equality actually meant identity. The me of right now isn’t even equal to the me of yesterday. In a positive sense all men, including identical twins, are different and therefore unequal.

Now we have to create an operational government to assure that they are enforced.
Says who? You’ve just ruled out anarchy without any justification. Note that for reasons Randall Holcombe explains here, I’m not an anarchist. It’s just that you skipped over it too lightly.

What are the choices?
Certainly more expansive than you’ve made them out to be. Most of human history has been characterized by neither of your alternatives, and you don’t even address the question of how wide the franchise should be in a democracy. You might be interested in Mencius Moldbug’s formalism.

As I’ve said before I don’t know how to fix this. It’s a flaw in democracy. I’m hoping for some ideas from somewhere.
We could go back to the Constitution, as Ron Paul advises. That would prevent a whole host of stuff. I prefer the articles of confederation, but the Constitution is plenty good in comparison with the status quo. Bryan Caplan has some suggestions, but you seemed pretty dismissive of them.

conchis August 13, 2007 at 9:22 am

TJIT, “The poor would probably benefit if more effort was spent trying to figure out how to move them from engaging in personally destructive behavior and less justifying said destructive behavior.”

Well, the point is that, if you want to change people’s behavior, you might want to spend some time figuring out why they’re acting the way they are. This is the whole point of Karelis’ book. If their actions are rational responses to their circumstances, then attempting to get them to act “more rationally” is unlikely to help much unless you do something about the circumstances.

More generally, I don’t see why people see the need for either/or explanations here. My (unsupported) intuition is that both convex utilities, and certain elements of irrationality are likely to be at work (and may interact in interesting ways).

dougnn August 22, 2007 at 7:46 pm

1. There is absolutely no scientific basis, considering the latest genetic and evolutionary research, for believing that all human geographic / ethnic populations have the same overall IQ, or the same distribution of personality types, and so on. Some groups are very likely to be adapted to modern highly abstract high growth economic strategies than others. There is large and mounting evidence that very significant brain evolution occurred esp. in some areas in the last several thousand years, and even in the last thousand esp. among some groups.

2. Cultures and genes do in fact tend to co-evolve. I’m not talking cultural fads and other very short term ephemera here, but longer term cultural basics. Lactose tolerance (drinking milk and eating cheese and butter into adulthood, for example, but there are many others). It’s likely they do so far more finely than we now appreciate.

AlexanderOliver September 12, 2007 at 2:24 pm

Karelis’ point is that there’s a difference between pleasure and relief of pain.

Poor people are in pain, and until they get out of it to somewhere a little more neutral, their decisions are not going to jibe exactly with someone whose goal is to increase their pleasure.

xicao November 13, 2007 at 8:36 pm

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