Sunday Review: the giving green paper

by Anthony Painter

Lying a short reach from my keyboard is a Cadbury’s Twirl. I want to eat it, as I like Twirls. Most connoisseurs of corner shop chocolate bars do. It seems a fairly logical response for me to eat it. But wait. Eat too many and all sorts of bad things could happen. I could become obese. My teeth could rot. I could end up with diabetes and heart disease. These are not nice things.

What we have here is a defective choice architecture. All the benefits of eating the Twirl are in the here and now. The costs are deferred. Our decision-making is flawed. Even the knowledge of the harm that too many chocolate bars will have is not strong enough to override the impulse to consume this Twirl. Even if we are consciously aware of the long-term cost, it is very difficult to overcome the overwhelming short term emotional benefit.

Somehow, I need a short term nudge to prevent long term pain. Essentially, this is what the Tory-Lib Dem government’s Giving Green Paper is about. How can we be nudged to do good to make ourselves and those around us more happy?

Its central argument is that those who give time and money to good causes have greater “subjective well-being” (happiness) and that they benefit those around them, who are also inspired to do good. In so doing, they will also be happier and so on. Economists call this “positive externality”. By eating this Twirl, I will make the other person in this room miserable, as there is only one (and I would consume both fingers, naturally), so there is a “negative externality” also to consider. With giving it’s the opposite – everyone’s a winner.

This all sounds great, but something quite incredible is going on here. A government is seeking not only to ensure that we have enough to live on, or that we have adequate basic services, or that we are secure, it is actually seeking to make us happier. In order to do that is seeking to initiate and secure a cultural change. A cultural change.

Without any hint of self-doubt, the paper outlines the “route to a more giving society”. It is two-pronged: how to achieve cultural change; why it can achieve cultural change. It seeks to define new social norms and tilt the “choice architecture” so that the benefits of giving are felt more immediately and the costs are minimised or deferred.

Ricahrd Thaler and Cass Sunstein call this approach “liberal paternalism”. Essentially, it means that the state intervenes subtly to correct situations where the cost is upfront but the pay-off is in the distance.

Cass Sunstein is now president Obama’s regulatory czar. His UK equivalent is David Halpern, who has been seconded from the institute for government to the cabinet office as head of the behavioural insight team. It is worth reading Halpern’s essay accompanying the green paper as it outlines the behavioural science underpinning it.

Like any oxymoronic ideology – Red Toryism, liberal conservatism, market socialism –  “liberal paternalism” should be handled with extreme care. “Liberal paternalists” can be simultaneously micro in action but wildly ambitious in terms of their goals. When it comes off, it can be elegantly effective, but it is more likely that small actions mean little change.

On some level, though, the green paper’s approach has to be admired. Rather than resting with traditional and largely erroneous assumptions about human nature, it actually tries to understand how human beings are really motivated and really act. It understands that we are faulty decision-makers, that we are heavily influenced by those around us, and that we derive satisfaction from reciprocal exchange. By attempting to apply the latest scientific understanding to real world problems, it is a radical departure from anything that has gone before.

The left has to be careful how it engages with this approach. Ridicule is easy. Twibbons are hardly going to change the world. ATM donations will certainly not add to anyone’s happiness at any cash machine I happen to be queuing at in the cold. But those who sneer will not impress anyone.

Another easy critique would be to shrug shoulders and dismiss the notion that anyone has the inclination to give more or time to do more. Since when were the left the pessimists when it comes to human nature?

Pessimism is a political dead end. It would be far more compelling to engage fully with this discussion about how the state can initiate real change based on a better understanding of ourselves. It will only really work alongside real resources and only the state can provide those with any real security. So the state and the big society actually become a combination act: without both, neither will succeed. It is great if people volunteer for their local school. However, the school also needs to be able to hire great teachers, modern equipment and teaching materials, and have suitable buildings in which to teach.

Nudge, liberal paternalism and behavioural science have an enormous contribution to make to sound public policy. They have their limits. It is an intellectual revolution that bears some similarity to post-war Keynesianism. Just as the economic technicians in HM treasury failed to use the ideas of Keynes to deliver non-inflationary growth and full employment on a consistent basis, behavioural economists in the cabinet office won’t make us particularly happy. They may, though, make some things better.

However, in the Giving Green Paper, as in so much else, this government is in danger of massively over-promising and yet falling way short. The claims are great. The tools they have chosen are limited. And very soon liberal paternalism may start to sound, well, paternalist. When everyone starts to shout about their charitable virtue in order to leverage the network effects of giving, it could become pretty tiresome very quickly.

Since you ask, the Twirl was delicious. It may not ultimately make me happy. So be it. I’ll risk long-term happiness for a bit of short-term joy. That’s just human nature, after all.

Anthony Painter’s Twitter feed is @anthonypainter

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