Election day has passed; America has a new president elect. Specifically, America has a president elect who seems completely ignorant of economics. Thus, regardless of whether one agrees with his economic objectives, he is unlikely to be able to realize those goals. Why, then, did so many vote for him?
I see several alternatives. The first is that the voters are simply bad decision makers, unable to tell what lies in their best interests. But this seems inconsistent with what we see elsewhere. The American entrepreneur is the quintessence of the type. Americans are elsewhere condemned not for their naivety, but for their excessive self-interested calculations. So Americans are not bad decision makers normally.
Perhaps Americans are simply ignorant. But how can this be, when we have been bombarded by election propaganda for over a year? There is certainly no lack of information, and one would have to expend great effort to avoid it. But perhaps this information is faulty? Perhaps the candidates are not revealing their true beliefs? But I condemn not some arcane policies of Obama, unknown to any without exhaustive research; instead I condemn that which is held with the greatest pride, his fundamental faith in government and mistrust of the market. The voters know him for whom they vote.
What, then, remains to explain Americans’ bad decisions with regard to politics? Voters are normally good decision makers, and have good knowledge of the issues at stake. Clearly, if both of these factors were true with respect to elections, voters would make a good decision. But they did not. Clearly, then, one must not hold with respect to elections. The second was proven specifically with regard to this elections. So we must change the first, holding that voters, while normally rational, make poor decisions in elections.
But nothing happens without cause. Why do normally rational voters vote poorly in light of available information? Unfortunately, I can see no means of proving one cause to be predominant in an event so complex as elections. But one fact does grab my attention: that while in business and consumption one reaps the full effects of one’s decision, both material and psychic, in voting one does not. Specifically, one’s rewards are divided, into psychic benefit inherent to voting for a candidate, which is guaranteed, and material benefit (what one gains from having the preferred candidate in office) deriving from having a better politician in office, which is achieved only if one’s vote influences the results of the election (for even if one votes for the winning candidate, if that vote was not the decisive vote, then one would have achieved the same material well-being had one voted otherwise). Thus, if psychic and material utility work in opposite directions, one could rationally vote for a candidate with harmful policies, as the low probability of one’s vote being decisive would cause that harm to be an insignificant factor in his decision. So bad voting could be rational. Why, then, should we condemn it? Because the material effects do not go away. Its lack of impact on the voting decision does not mean that people do not care. In fact, I think that most voters would rather have a president with proper policies than have any psychic utility achievable in voting by a substantial margin.1 Thus, in an election, each voter pursuing his own interests can lead to a result extremely harmful to the entirety.
How does this work? The best description I have encountered is Bryan Caplan’s term “rational irrationality”. In pursuing psychic interests, voters are acting rationally to maximize their utility. But at the same time, they are acting irrationally, for this process inevitably involves a suspension of judgements and false views of reality.
What is the general tendency of rational irrationality? Unfortunately, I think that it is towards large government. Government interference with the free market can achieve very few goals (such as the wanton exercise of power, or destruction of the economy); it cannot lead to increases in efficiency, nor can it redistribute wealth without great harm. Thus, almost everyone should want a small government, regardless of whether they wish to help the poor, protect the environment, or enrich themselves. But there is something peculiarly unsatisfying to saying “Help end poverty; vote to end welfare”. Thus, I think that someone truly interested in helping to end poverty would be much more satisfied if given the option of doing something much more concrete, particularly if he could pass off the costs through government (as opposed to doing something on his own initiative). Thus, he would derive greater psychological utility from voting for a candidate who promised to fight poverty than from an advocate of the free market (so long as he actually believes the claim of the first; his irrationality is believing this claim not because it is true but because he derives greater psychic utility from acting on it than from acting on the truth).
Voters are normally rational, but have a fit of temporary insanity in the voting booth. How else are we to account for their persistent bad decisions?
1. This is not an accusation of egotism; I do not assume that voters care only about their own interests. Rather, I am saying that candidates would like to have their goals actually realized. Thus, if one were interested in helping the poor and thus favored policies harmful to one’s private interests that could nevertheless be expected to help the poor, this would exhibit no trace of irrationality.