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Government Promotes Irrationality
on February 8, 2015
Interesting books. Indeed, people are often irrational. But Ariely misses one of the obvious and major reasons people make SEEMINGLY irrational decisions, that are actually quite reasonable and rational from an individual perspective. Our society has increasingly alienated people from individual responsibility and from other citizens, and it has taken the risk out of making decisions. For over 60 years now, citizens have been detached from the effects of their negative decisions, whether concerning lifestyle or the effects of bad financial choices. With a constant barrage of government-sponsored propaganda; emotionalism and group-politics have replaced rationality as the bases for decision-making. And modern U.S. government propaganda is the most effective in history, as it employs all the lessons learned and techniques of behavior manipulation from the disciplines of sociology, psychological warfare, and psychology over the past 100 years. There are ongoing propaganda programs promoting government provided medical care, unemployment insurance, welfare and social security benefits, free monthly income even for young people, and the chance of filing a lawsuit or getting the government involved when investments go bad. The government conditions citizens to incorrectly believe that correlation is the same as causation; and that appearance and emotional intent are the same as results. The government's goal: promote reliance on government and avoidance of individual responsibility, thought and judgment. Why? To insure ease of public manipulation and the political power of certain groups.
For example, during the recent "subprime mortgage crisis," which Ariely cites as an example of irrationality, all parties behaved rationally and reasonably, EXCEPT the supposedly rational U.S. Government. Homeowners who could not afford houses knew the government was guaranteeing the loans and, given their minimal down payments, they knew they had little to lose from foreclosure if they could not make payments. Thus, it made perfect sense from their perspective to risk buying homes they could not afford. Similarly, lenders knew the loans were government guaranteed, and the government was threatening lenders with lawsuits and fines if they did not make loans to unqualified buyers, so the lenders knew they had little risk in making imprudent loans. In fact, lenders faced greater risk from government harassment if they did NOT make imprudent loans. Investors in those loans also acted rationally. They understood, correctly, that the government would not allow homeowners, lenders and investors to lose billions or trillions of dollars on a program the government forced on the country. Thus, investors bought loans they knew would probably go into default, because, even if they received no payments from borrowers, the government would rescue financial institutions and investors, which it did. Finally, the only party that did not act rationally was the U.S. government. First, it "incentivized" imprudent economic activity by taking the risk from lenders, borrowers and investors. Then, to make matters much worse, it actually rewarded and has now promoted imprudent financial activity by rescuing all parties to the government created mortgage "crisis."
Over the past 60 years, governments have aggressively promoted irrational risk-taking (which is actually rational for the individual, since he risks nothing), which has spread to all areas of individual human endeavor. Citizens are increasingly losing their good judgment, since the world in which they live is a fiction created by the government, bearing no relation to the real world of finance, economics, and survival based on good decisions. Thus, contrary to Ariely's thesis, the forces of "irrationality" are not hidden. Irrationality is a necessary part of modern government. In fact, many of the programs created by the government have the irrational and exact opposite effect than the one intended. For example, the 1960s "Great Society" and "War on Poverty," created more poverty. The War on Gun Ownership has resulted in more violence by criminals. The welfare system designed to help families, destroyed families, and created several generations of illegitimate children. Despite billions spent on education; Math, Science and intelligence testing scores are in decline. This is because foolish government bureaucrats and academics have confused correlation with causation. Education does not make people successful. Rather, successful intelligent people are more likely to finish their education and continue to be successful. It is a waste of money to try to over-educate an unintelligent individual, who should be directed to trade training. Instead, politicians tell us it is preferable students receive diluted, fake degrees. There is insufficient space for a complete list of government irrationalities.
It is enough to note that modern government employs techniques similar to the "Cargo Cult" islanders who, by using sympathetic magic, thought that creating the superficial appearances of a system (fake airport and planes), would bring material reward (delivery of cargo). Like modern politicians, the Cargo Cult confused correlation with causation. Citizens have learned the lessons of government irrationality and it has conditioned individual behavior. Many academics and intellectuals, such as Ariely, have lost sight of the fact that human beings are animals that respond in ways that are similar to organisms and other animals. That is, they seek the easiest path to satisfaction of needs and emotions, and avoid effort and thought whenever possible. This is particularly true of individuals subjected to prolonged government propaganda campaigns. Government cannot force one to be successful, but it can set up conditions promoting irrationality and failure, as the U.S. has done. The best antidote to predictable government irrationality is to place individuals back in touch with reality, that is, with the true effects of their decisions. Despite Ariely's faulty analysis, he does unwittingly show the many ways in which government directly and indirectly promotes irrationality.
As long as they receive government benefits and hand-outs, most citizens will not look behind the “wizard's curtain.” Nevertheless, modern U.S. Government is unlike any before. Citizens can observe that government is now nothing more than an unsustainable Ponzi scheme. A broad tax base of new taxpayers is needed every year just to pay basic government expenses. Yet, each year, the tax base shrinks (population of taxpayers decreases) and government expenses rise. In the face of this disaster, has government made an all-out effort to cut expenses? Of course not. Government is raising taxes to dangerous and debilitating levels, borrowing huge amounts of money from foreigners, and INCREASING EXPENSES. Obama has quadrupled-down on failure, creating the largest deficit ever. If a private citizen or corporation ran its affairs in this manner, it would be criminally procescuted for fraud.
Citizens have internalized the government's ongoing propaganda-of-irresponsibility, and they observe the government's example of irrationality and emotionalism. And now the People are behaving just like their government. This is what government “nudging” has created.