26 April 2014

Democracy in danger

Multivariate analysis indicates that economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while average citizens and mass-based interest groups have little or no independent influence. Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens (pdf), Martin Gilens and Benjamin I Page, 9 April

The authors came to this conclusion after reviewing answers to 1779 survey questions asked between 1981 and 2002 on public policy issues. They broke the responses down by income level, and then determined how often certain income levels and organised interest groups saw their policy preferences enacted.

There's little prospect of this changing so long as policymaking is conducted in terms of things that alienate ordinary people. Sometimes our politicians speak eloquently of lofty, high-minded goals whose time lines stretch so far into the future that they can be sure they will not be held accountable for their failure to realize them or that are otherwise unverifiable because they are just too vague. More often, though the stated goals of policy have to do with dollars spent, institutional structures and composition, legalisms, regulations or outputs - all of which are too arcane, complex and obscure for anyone other than lawyers, lobbyists and ideologues to follow closely. The only people who understand policymaking today are those who are paid to do so, and the only people  who influence it are those who have the millions of dollars necessary to pay them. These are Gilens' and Page's 'economic elites and ... business interests'. They continue:
When a majority of citizens disagrees with economic elites and/or with organised interests, they generally lose. Moreover, because of the strong status quo bias built into the US political system, even when fairly large majorities of Americans favour policy change, they generally do not get it.
Yes, our societies are complex and highly aggregated. But people's goals are far more easily articulated than the alleged means of reaching them. One solution to the problem described by Gilens and Page, and felt by almost everyone, could be to express policy goals in terms of outcomes that are meaningful to ordinary people. Things like pollution levels, crime rates, poverty rates, literacy standards. There wouldn't be universal agreement about target levels and priorities, but there would be engagement by the public in the policymaking process. With such engagement, there would be influence and buy-in.

A Social Policy Bond regime would start by expressing our social and environmental goals in terms that people can understand and influence. Government, instead of trying to guess how best to achieve our goals (which it is not good at doing) would instead concentrate on articulating society's goals and raising the revenue for their achievement (both of which democratic governments can actually do quite well). The other essential element of a Social Policy Bond regime is to inject the market's incentives and efficiencies into the achievement of our social goals - something that rarely happens nowadays. (For more, see my SocialGoals.com website.)

The alternative? Gilens and Page conclude:
Americans do enjoy many features central to democratic governance, such as regular elections, freedom of speech and association and a widespread (if still contested) franchise. But we believe that if policymaking is dominated by powerful business organisations and a small number of affluent Americans, then America's claims to being a democratic society are seriously threatened.

24 April 2014

Mickey Mouse targets: gargantuan impact

From The Economist:
Like almost every other local government in China, Xianghe’s has an urbanisation target: 60% by 2017, up from around 50% today and ahead of the national target of 60% by 2020. Since the global financial crisis in 2008, governments have been hardening such objectives as a way of stimulating growth, and have been borrowing heavily to meet them. Emerging from the shadows, 'The Economist', 19 April
Targets such as these, including especially the universal (apart from perhaps in Bhutan) and much-revered de facto target of governments everywhere, Gross Domestic Product, are Mickey Mouse in conception and in their relationship to ordinary people's well-being, but not, unfortunately, in the impact they have on us all. They are top-down targets, favoured by the political caste and their functionaries. They become the sole focus of bureaucrats' attention to the exclusion of anything else. When it comes to urbanisation in China, the impacts are socially and environmentally disastrous: local governments scramble to meet the targets by throwing peasants off the land they and their families have been farming for generations. One result, The Economist continues, is...
 ...the rampant urban sprawl encouraged by local governments’ ability to seize rural land at will. Such unrestrained expansion may work in parts of America where there is plenty of empty land (albeit at a cost to the environment and often to the quality of life). In China, where urbanisation has forced around 40m farmers off their land over the past three decades, usually with little or no compensation, it will not.
There's a stark contrast between the ad hoc, spurious, almost random nature of targets like urbanisation rates, and the serious negative impacts they have on everyone other than the people who dream them up. 

People who make policy for large societies need to rely on some sorts of numerical indicators of society's goals and how quickly we are reaching them. But indicators and targets should be well thought out and as consensual as possible. They should be in themselves, or be inextricably linked to, things that we actually want to achieve. In other words, they should not merely have (perhaps) been associated with social well-being in the past. They should be outcomes that are meaningful to ordinary people, because that's what matters most and that is what will encourage people's engagement with policymaking and hence buy-in to policies that affect us. Mickey Mouse indicators like urbanisation, or GDP are just not good enough. They speak of a growing and dangerous alienation of rulers from ruled.

17 April 2014

Non-random incentives for world peace

The average person is now roughly 20 times less likely to die violently than the average person was in the Stone Age. The Slaughter Bench of History  Ian Morris, 'The Atlantic', 11 April
How did this come about?  According to Professor Morris:

For most of our time on earth, we have been aggressive, violent animals, because aggression and violence have paid off. But in the 10,000 years since we invented productive war, we have evolved culturally to become less violent—because that pays off even better.
I can't argue with Professor Morris. Human beings are rational, and respond rationally to the incentives on offer. It's tragic, though, that the incentives not to prosecute war seem to have come about quite randomly; through experimentation over millennia with every sort of conflict, fought with ever-improving technology, at calamitous human cost.

I think we can do better - and we should. Instead of relying on the slow, random and painful process of learning through direct experience, we could actively create or magnify the incentives for peace. We could, simply, make a conscious, deliberate decision to increase the incentives for people to avoid war.

How? We could apply the Social Policy Bond principle to violent political conflict. We could issue World Peace Bonds or, say, Middle East Peace Bonds. We don't have to know how people who invest in these bonds will use their expected returns from bondholding to reduce the chances of conflict breaking out. Nor do we need to know who, exactly, will buy the bonds and undertake peace-building activities. What we would do, by issuing Peace Bonds, is motivate people who are currently pre-occupied with other, probably less socially beneficial, concerns, to get involved in peace-building and explore, refine and implement the most efficient ways of ending war. 

War has been a curse for generations and remains an existential threat: the full title of Professor Morris's piece excerpted above is: How war created civilization over the past 10,000 years—and threatens to destroy it in the next 40. Peace Bonds could generate bigger incentives to end war far less randomly and at lesser human cost, than through the the current process of random blundering accompanied by painfully slow, fitful, learning; a process that may yet culminate in unrestrained nuclear conflict with the deaths of millions.

12 April 2014

Metrics for peace

Social Policy Bonds have their most marked advantage over conventional policy when trying to solve complex solutions for which there is no single, knowable, solution. Climate change (or some of its impacts), crime, or infant mortality in the poorest countries are examples of such problems, as too is violent political conflict: war or civil war.

For issuers of World Peace Bonds, or Middle East Peace Bonds the challenge is not how to achieve peace - that will be left to bondholders - but how to define it in such a way that its achievement will robustly and verifiably have brought about societies in which most of us would be happy to live.

A start would be to issue bonds that would become redeemable when there has been no nuclear explosion that kills more than, say 100 people before 1 January 2050. We could of course issue bonds targeting nuclear peace for decades beyond that date. Similarly, we could target sustained periods of peace relative to today's world: bonds that would become redeemable if the annual numbers of people killed in conflict fall below 50 percent of the average levels from 2007-2012, say, for a period of 10 years.

But a ruthless and powerful dictator could impose those sorts of peace by simple blackmail. We could perhaps therefore combine our main peace goal with other conditions that will have to be satisfied for the bonds to be redeemed. These could include broad quality of life indicators, including the well-being of all communities in a population. It might also be worthwhile to classify as outcomes such essentials for war as weapons, or the sums spent on them, or the number of men and women under arms, and target these for reduction too. We might also want to target attitudes of people towards people of different countries, ethnicities or religions, in ways that will discourage politicians and others from provoking conflict.

Feeding into such attitudes, or possibly as another target to be considered by bond issuers might be to encourage intermarriage between communities that are currently antogonistic. For most governments, advocating or even discussing such an idea would be political suicide. But for holders of Middle East Peace Bonds, for example, it would merely be another tool that can choose to use or not, depending on their view of how effective it will be. Under a bond regime targeting the end of violence between communities in conflict, no official programme of sponsored intermarriage need be contemplated. Bondholders, though, could do, or cause to be done, things that governments cannot do. There would be no sinister motives underlying their actions; their motive, clear and comprehensible to all, would be explicitly mercenary with no sinister overtones: to raise the value of their bond holdings. As human beings, most of us agree that anything that resolves conflict peacefully and at a bearable cost should be encouraged. Apart from fanatics, even the devout on both sides of most conflicts, away from public fora and in their cooler moments, would put human survival above ethnic purity or identity politics. Even a little intermarriage between two warring factions could go a long way.

Most likely, under an enlightened Peace Bond regime, intermarriage, rather than being directly encouraged, would be the happy outcome of a range of projects aimed at increasing informal contacts between two sides of a conflict, including such trustbuilding measures as lower barriers to trade, school exchange visits, or mixed sports teams. One of the benefits of the Social Policy Bond concept is that it can stimulate actions like these including, if necessary, the direct sponsoring of intermarriage, or the birth of mixed-ethnicity children which, if governments were to undertake them directly, would be met by near universal disdain and opposition.