Now look who’s talking — someone who can’t see the forest for the grass!

I have made clear, many times and in addition to Dr. Hsieh, that the point is not the alleged benefit, “social” or otherwise of the “nudge”, its about the moral prerogative thereof. I am saying that no one has that prerogative, government or otherwise. No one has the moral right to turn the ant into a grasshopper without his consent (which is opt-in, by definition).

That is my primary point of disagreement. Your arguments about the alleged benefits of “nudging” presumes that it is morally OK to do so. Why is nudging moral? That’s ball’s been sitting in your court since Dr. Hsieh put it there, but you’ve been ignoring it while fanning at empty air ever since.

You raised the specter of the “Hobbesian battle for resources” story, intoning that if we didn’t “nudge” people into 401(k)’s, they’d simply loot us for it via the vote. Nudge — or else!

Is that what you think passes for a moral point?

I probably should have ignored this tangent, but I nonetheless pointed out that this potentiality was a consequence of democracy, itself born of that same wider paternalistic principle which underlies “nudging”.

You have not answered that… you instead circle back to your “subtler points” of nudging, all the while projecting ideological blindness upon me…. while carefully not seeing that my original moral challenge is still sitting there, waiting.

In point of fact, I favor a complete privatization of Social Security and the abolition of Medicare. I think that all government subsidies for consumption should come in the form of loans, at best.

Square that circle with your perception that I’m some kind of “paternalist”.

It’s not my perception; you have indicted yourself as one right here. You favor “nudging” in principle (and now, government loans? Slipping and sliding already!)

You clearly haven’t thought these things through with any degree of thoroughness. You should just quit now.

Projection is not an argument.

What? They make endless demands, by organized political means, for limitless tolerance and respect for their own sexual practices. How could we ask for more?

Worse – it creates an unfunded obligation on you to endlessly check new regulations and to spend your own time – that’s money, Mr. Sunstein – to study, weigh the consequences, make your decision, and ensure that the proper agency is clearly informed of your decision. Mind you, that’s the necessary procedure for every such mandate which comes out of formal laws AND/OR informal ‘regulations’ from bureaus with regulatory power.

Who told them that it worked that way? Who taught them that they were morally *entitled* in that fashion? Who fed them these lies? The paternalists did. You did, sir. This “nudging” is an expression of the same altruistic “for their own good” morality that set the problem up in the first place!

This is another great example of your inability to see the subtler points of the argument for making the default option for 401ks “contribute” versus “don’t contribute”. In point of fact, I favor a complete privatization of Social Security and the abolition of Medicare. I think that all government subsidies for consumption should come in the form of loans, at best.

Square that circle with your perception that I’m some kind of “paternalist”.

It’s like you took the saying “Give a man a fish and you feed him for a day, but teach him to fish and you feed him for life” and turned it into “Give a man a fish and you feed him for a day, tell him that fish are delicious and point him toward the ocean and that’s the best he can expect”. It’s stupid and it negates all of the benefits of even having something called “society”.

In the context of a 401k, what do you think not having someone defaulted into the program is other than a “choice” being made by the government, when it originally designed the program. The thinking was that people would recognize their self-interest and voluntarily opt in. The results is that the average Baby Boomer has less than $50K saved for a retirement that will last an average of 30 years (I know all the actuarial projections behind all this stuff, but feel free to look it up yourself) and will run out of money from savings before 7 of those years in retirement are over, even after utilizing home equity. These are the results of a “choice” that the government made to set up 401ks and not allow employers to auto-enroll their employees.

Oh, and by the way, one of the groups that pushed for auto-enrollment was the employers, even though it costs them more because now they have to match a much-larger group of employees’ contributions. Why did employers want this? BECAUSE THEY DIDN’T WANT TO SEE PEOPLE WORKING FOR THEM STARVE TO DEATH IN RETIREMENT, YOU NITWIT!

you are telling us that if the grasshopper decides to loot the ant, it’s the ant’s fault.

In all seriousness, you are so blinded by ideology that you don’t see the bigger picture. The ant and the grasshopper is a zero-sum game. The “nudge” in the 401k example is not. Essentially, the “nudge” turns the grasshopper into an ant, thus precluding the Hobbesian battle for resources described in the parable.

You clearly haven’t thought these things through with any degree of thoroughness. You should just quit now.

Over time, libertarian paternalism will become less “libertarian” and more “paternalistic.”

There absolutely is no libertarianism in the paternalistic policies recommended by Sunstein. He and others deliberately co-opted the word “libertarian” in order to destroy its meaning. This is similar to the destruction of liberalism, which now means something totally different than it did fifty years ago. Libertarians gets smeared in both directions: Sunstein says a libertarian government can direct individuals’ choices, and others say that libertarianism is the same as anarchy.

The one agreeement I have with Sunstein is that we are a country of Homer Simpsons. But, a big problem for the nanny-statists among us is that many of those Homers work for the government. So, why should the government become our parents?

I would say that the argument that “nudges” can be helpful does not answer the argument that government restrictions in individual choice are immoral.

I know I understood what you said, because I recognize the exact same premise in your latest post as in the earlier one: that the possibility that some people may act against their own self-interest is sufficient moral justification for government to make choices for them for their own good.

What you are doing is avoiding the moral problems and trying to argue for it on the basis that it is “practical”. That is the fatal flaw in your argument. If it is immoral, it is also impractical — the immorality of “nudging” and the wider ideology behind it, is why they fail in practice.

And that’s the point here: this is not a problem of “intelligence”, but one of morality.

The people who refuse to act in their own self-interest are not doing so because they are too “stupid” to know. They do so because they expect someone else to handle it for them. They have been told all their lives that we have moral obligations to each other, obligations that transcend our right to choose… so they expect to pay their taxes and then have everything taken care of for them when they get older.

Who told them that it worked that way? Who taught them that they were morally *entitled* in that fashion? Who fed them these lies? The paternalists did. You did, sir. This “nudging” is an expression of the same altruistic “for their own good” morality that set the problem up in the first place!

The ones who set up the conditions for mob rule are the paternalists of all stripes who encouraged generations of people to expect others to catch them when they fall… and the ones who substituted democracy for freedom, handing over to the mob the club of government.

So of course, when you then say

You don’t seem to realize that your the one setting up the conditions for mob rule with your absolutism.

… you are telling us that if the grasshopper decides to loot the ant, it’s the ant’s fault.

Such are the logical results of an inverted morality.

The problem you describe with “starving Boomers” is a real potential. It is the built-up legacy of paternalism going back as far as Herbert Croly. Pushing more paternalism as the solution is the same kind of insanity as pushing more debt as the solution to excess debt.

….

Fortunately, people are *not* stupid, and those who militantly expect to be taken care of are not a physically large group, nor are they particularly dangerous if they have no access to government power. Most Boomers I know, including my fiance, know to expect Social Security to be effectively nonexistent by they time they reach retirement age. Those who don’t have a solid retirement fund in place, expect to work longer.

I’m worried that you are misrepresenting what “nudges” are all about. What I’m hearing is that “Government pushes (and worse) are really bad, so I don’t like nudges.” I don’t think many people, including Cass, would argue that government “pushes” and restrictions on choice lead to optimal behavior.

The whole essence of a nudge is that the private choice is beneficial and must be preserved, that context and defaults (which must be set to some option anyway) have an illegitimate influence on people’s choices, and that even when defaults are set, it must remain absolutely *easy* to opt out in order to preserve choice.

The principle really only comes into play when there is evidence that people are actually making choices without really putting their thinking caps (acting on auto pilot, and we all do it).

You may be right that the slope may slip–any good thing taken to excesses and extremes can be–but arguing that government *restrictions* on private choice are bad does not answer the argument that nudges can be helpful.

As a libertarian familiar with Cass’s work, I don’t think Obama could have (let alone would have) appointed a better individual for this position. Sunstein is much more of a Chicago School thinker than you give him credit for (he spent less than one year at Harvard, and nearly 30 at the University Chicago).

By the way, I’m a big fan of your “Geek Press” blog–keep up the good work.

I’m not completely convinced you understood what I said. I said that the reason it makes sense to auto-enroll (the technical term for what is now allowed in 401k plans) employees into these plans is that young people do not seem to realize the potential for compounding gains and apply too high a personal discount rate to consumption over savings. So long as the plan also allows you to opt out if your employer auto-enrolls you, which they all do, that is fine to me. You don’t seem to realize that your the one setting up the conditions for mob rule with your absolutism. Unless you have some convenient way of disposing of millions of starving Baby Boomers (and, in the future Gen Xers) who have failed to save for retirement and are no longer needed in the workforce, asking people to set aside a small amount of choice today for a more secure (cue up your quote about those seeking security over liberty deserving neither) tomorrow is the more prudent choice for someone setting public policy. Seriously, as a thought experiment, ask yourself what the situation is going to be like in 15 years when there are 30 million Boomers in retirement who’ve just run out of money. What do you think they are going to do, just lay down in their beds and die off peacefully? I’m not pandering to Boomers at all, I’m saying that what’s going to happen with the Boomers is already baked into the cake precisely because when 401k plans were first implemented, no one realized that the people who get the most benefit from them, i.e. the young, were not using them fully. That’s why Sunstein’s proposal to make saving in a 401k plan makes sense. People don’t really miss the 3% of their pay that gets auto-defaulted into the plan, but it pays huge dividends to them in the future.

KPO’M,

Guaranteed returns can be built into 401k plans by making annuities one of the investment options. I’ve actually studied this quite a bit, too. Other alternatives to annuities are starting to come onstream, like guaranteed minimum return mutual funds where an insurance company partners with a mutual fund, they design a portfolio that can be hedged in the derivatives markets so that if the portfolio goes down, the derivatives hedging it go up by a nearly equal amount (there is no such thing as a perfect hedge). In the near future (provided the government doesn’t do something stupid like convert our 401ks into guaranteed return plans run by the government, which some have proposed),nearly all 401ks will have more limited investment options that can be guaranteed to provide a minimum return, in exchange for paying a fee to the company providing the guarantee.