Faced with radical uncertainty, rationally ignorant actors are more likely to fall back on conventional, emotionally satisfying beliefs than complex theories advanced by professional economists
In a previous post we argued that the current obsession with the UK’s budgetary position, far from being the result of a rational debate about Britain’s economic problems, is best seen as an example of ‘political bullshit’. We used the term in the conceptually precise way proposed by Harry Frankfurt: that is, that bullshit is qualitatively different from lying, in that it betrays a lack of concern for the truth, rather than a conscious decision to tell an untruth. The result is that British politics is characterised by a ‘deficit fetishism’ that has trapped almost all of the political elite in a discourse that appears unconcerned with the real problems we face and the policies that could address them.
Here we look beyond the identification and definition of the problem to consider the reasons why bullshit is so successful politically, and what can be done about it. As we noted in our previous post, much of the discussion of the deficit makes no economic sense; yet large numbers of British voters appear to have been convinced by the argument that deep spending cuts are the best way to improve the economy, even though most economists agree that excessive austerity has actually hindered the recovery. Why is political bullshit popular, even when the policies it underpins have clearly failed?
The first point to establish is that, if politicians are rarely attuned to the kind of rigorous analysis that Keynesian economists such as Krugman and Wren-Lewis deploy to ridicule ‘deficit fetishism’, then ordinary voters are even less equipped to make informed judgments about the causes of economic problems and the likely effects of policy responses. Not only do most lack the knowledge and critical skills necessary to such a task, they also lack the time and motivation to engage in serious political and economic analysis. Instead, they have every reason to settle quickly on the political narrative that sounds most plausible to them and, once that is done, to update their view only if discordant information becomes overwhelming. Even then, the power of cognitive dissonance can prevent them from truly engaging in any serious revision of their views.
However, this receptiveness of ‘rationally ignorant’ citizens to a bullshit discourse of economic problems could potentially favour a variety of alternative ideas. Why should voters be more amenable to austerity than Keynesian counter-cyclical spending or indeed, central bank printing of ‘helicopter money’? Does bullshit have a conservative bias? Interestingly, experimental research by psychologists in the United States has found that Republican voters were more likely than Democrats to prefer news from partisan sources that confirmed their prejudices. This is consistent with other research that suggests that conservatives, on the whole, are less comfortable with complex or ambiguous information and, consequently, are more likely to conform to the values expressed by authority figures.
However, there is no need to advance a partisan interpretation of the rejection of Keynesian thinking. Many voters on the left of the spectrum are equally suspicious of alternatives to austerity, with opinion surveys showing that large majorities of citizens in Italy and Spain (though not in Greece) support austerity measures – despite their devastating effect on Southern European economies.
In a sense, little has changed since the 1930s, when calamitous policy mistakes plunged the world into deflation, depression and ultimately the devastation of war, even as politicians and central bankers, on both the left and right, fretted over the need to restore ‘sound money’ and ensure all debts were paid in hard currency. Despite decades of research inspired by Keynes’ insights, failed economic ideas – what John Quiggin calls ‘zombie economics’ – never seem to die.
The irony is that contemporary politics is supposed to be more driven by rational, evidence-based, judgements than ever before. The vogue for regulatory agencies and rules-based policy managed by non-partisan experts has removed ever more political decisions from the hands of the professional politicians, who are of course the prime purveyors of bullshit. Moreover, the entrenching of mass education is presumed to have made public opinion – at least in rich democracies – better informed and more analytically skilled; a process Ronald Inglehart described as ‘cognitive mobilization’. Surely democratic institutions should be immune to bullshit by now?
However, there are other recent developments which point in the opposite direction. The ICT revolution and the spectacular multiplication of online sources of information accessible to almost everyone have placed citizens under huge cognitive strain. Presented with a variety of conflicting opinions, but also conflicting facts, Western publics are increasingly required to make their own individual judgments about the veracity and plausibility of political and economic arguments. Most, indeed perhaps all of us, are ill-equipped to do so. Even academic specialists can be hoodwinked into accepting nonsensical arguments, simply because they are presented in plausible manner. Yet we are all encouraged to trawl the internet for information and make up our own minds. As Cass Sunstein presciently argued a decade and a half ago, the rise of the internet has led to a fragmentation of sources of information and analysis and has increasingly generated the coexistence of multiple perceived realities in the minds of citizens. In short, we no longer can even agree on the facts, never mind what we should do about them!
If this state of collective confusion has paralysed attempts to address the relatively straightforward (at least scientifically speaking) problem of anthropogenic climate change, there would seem little hope of resolving our rather less well understood economic problems on the basis of rational analysis alone. After all, the Keynesian prescriptions of monetary and fiscal expansion, or indeed more radical proposals of debt monetisation and manufactured inflation, are themselves based on uncertain scientific knowledge. Traditional political science theory based on actors’ calculations of their material interests runs into the problem of uncertainty: how do we know if our economic well-being is best served by Keynesian reflation or sound money and fiscal retrenchment? The simple answer is that we don’t, for sure, although we could make an educated guess.
In this situation of radical uncertainty, rationally ignorant actors are rather more likely to fall back on conventional and emotionally satisfying beliefs, based more on the store of reassuring tropes with which we make sense of the world, than the sophisticated theoretical and empirical tools developed by professional economists. The current language of economic policy may constitute bullshit in that it is not rooted in serious concern for the truth, but it is not carelessly framed. On the contrary: it deliberately evokes the apparently timeless values of stability, safety and rewards for hard work and sensible financial decision-making. Deficit fetishism draws strongly on fables (‘fixing the roof while the sun is shining’), strong ideas of individual desert (‘hard-working families’) and association with desirable future states (‘aspirational voters’) to justify its economic choices.
In sum, in a world of competing realities as well as competing theories, the power of rhetoric is more likely to settle an argument than evidence and logic. Opponents of austerity need to think more about the theatre of the public sphere, rather than trying to reason the status quo into submission. Perhaps the only hope is to fight bullshit with bullshit. There is no a priori reason why deficit hawks should have the monopoly of politically attractive words. What’s certain is that, if we fail to take bullshit seriously, there will be no hope of laying the ground for more growth-oriented and socially progressive approaches.