"National Security", "family farms", "international aid" and now "climate change": a small sample of concepts that become corrupted by government and used to justify transfers of resources from the poor to the rich.
Under the current policymaking regime, politicians can get away with using phrases like these to justify setting up departments and initiating activities that sound as though they will help deal with a problem, but end up shoring up vested interests. They can do this because they absolutely refuse to reward the achievement of explicit, agreed, meaningful outcomes. Instead they channel funds into organizations whose names suggest to the naive that they are striving to achieve an outcome or deal with a problem. These can be government agencies, supra-national government organizations, or large and favoured corporations.
This came about largely because setting up bureaucracies for many social and environmental problems was originally the most efficient way of solving them. Society was less complex, the linkages less intricate, the time lags shorter. The nature of, responsibility for, and solutions to, our most glaring problems were often easier to identify than nowadays.
But times have changed. Nobody today can identify how to achieve world peace, though the need to do so is probably greater than at any time in history. Nobody really knows how to tackle climate change: the much-vaunted greenhouse gas explanation may or may not be totally wrong, and anyway cutting emissions might not be the best solution or, more likely, might just be one of many necessary approaches.
Yet we persist in attempting to solve problems only after a single cause has been identified. Once that happens, the response of government is to channel resources into bodies and activities that ostensibly deal with the cause of the problem, but whose own exists depends on failing to be efficient at doing so. Somewhere along the way, accountability is lost. So to help 'family farms' taxpayers and consumers spends billion on higher food prices to support wealthy landowners. 'National security' has become an excuse for mass surveillance, the setting up of an embryonic police state, and ruinously expensive accumulation of weapons systems. 'International aid' is a byword for corruption and waste.
Climate change looks like going the same way: becoming an excuse to set up massive bureaucracies that will allegedly cut greenhouse gas emissions - or what were thought to be greenhouse gas emissions back in the 1990s.
With Social Policy Bonds, there's no excuse for this sort of deception. Instead of vaguely targeting 'terrorism', or 'climate change', or 'rural poverty', we can specify exactly what it is we want to achieve. So if there is a societal consensus that poor people should pay more for their food so that enormously wealthy landowners can afford a second helicopter, we could choose to do exactly that. But if we actually want to help poor people, or to alleviate the problems caused by adverse climatic events, or to achieve world peace, then we can issue Social Policy Bonds that reward people only when they have achieved these goals. We do not have to wait until cause and effect have been identified; nor till the optimal solutions have been found. Under a Social Policy Bond regime it would be bondholders who would do all that; and the more efficient they are at doing so, they more they will be rewarded. Diverse, adaptive approaches are going to be necessary to solve our most urgent social and environmental problems. The current policymaking environment stifles such approaches. A Social Policy Bond regime, in contrast, would encourage them.