Maude is Confused About Nudge

Francis Maude writes about the nudge policy.

In 1921 there was a spate of road accidents in Sutton Coldfield, near Birmingham. Rather than banning cars, introducing police fines or erecting barriers, a white line was painted in the centre of the road. Accident levels plummeted, and painting white lines on roads spread across the UK. This was not a central government initiative. It was a local experience that turned out to be a highly effective way of guiding traffic without legislation – and an early example of a “nudge”, a prompt to our behaviour that most people consider helpful and generally unobtrusive.

This is a classic example of nudge. It is simple and effective and at its most basic, requires no government legislation.

We can encourage behaviour through price, such as when leaded petrol was taxed at a higher rate. And we can change the default options individuals are given in areas like pension schemes, so that citizens are given the choice to opt out rather than opt in.

And here we have it –  the “we” being the all knowing all benevolent nanny state. What he describes here is not nudge, it is state interference in our lives. It is not up to the state to encourage us to opt in either direction. And as for pensions choices, if I had my time again, not one penny piece of my hard earned would find its way into such a scam. When it comes to opting, there is only the one ethical position to take and that is opt in.

Over recent weeks, there has been criticism of the government’s interest in behavioural economics (the academic discipline associated with nudging). The criticism is that nudging behaviour is either ineffective or represents a cop-out from the proper business of government to legislate and enforce change.

He misses a fundamental objection here –  that much of what the state wishes to nudge is none of their damned business.

 But legislation has its limitations.

True and we have far, far too much of it already.

Is the answer to rising obesity a law restricting citizens to one chocolate bar a week? Should we ban TV in households with underachieving children? Of course not.

Absolutely. The answer is to leave well alone and allow individuals to make individual decisions. If their choices shorten their lives, well, look at it as evolution in practice.

We spend over £100bn every year on healthcare, yet only a tiny fraction of that money is directed at the behavioural causes of ill health – smoking, drinking and diet. As we seek to reduce costs, we must look for better, cheaper ways to do the job.

As we pay for universal health care, we should expect it when needed, even if we have caused the problem in the first place. We pays our money and we takes our choice as it were. We do not need the state to be involved. The smoker, the drinker and the obese are no different to the skier and the rugby player who need patching up from time to time. Individual choices with consequences and solutions that the individual has paid for through punitive taxation.

Behavioural insights can deliver benefits to citizens and save money. Changing the default of pensions schemes to an opt-out system has been shown to greatly increase savings rates, for example. An opt-out system is due to be implemented in 2012. We will be introducing cool-off periods for those taking up store cards too, as well as looking at new ways of encouraging organ donation and helping smokers who want to quit, and focusing on how consumers can save money through energy efficiency measures.

The policy junkie writ large. Either Maude is an interfering busybody or there has been a senior civil servant whispering poison into his ear. None of these things are the business of government. You see, I suspect that “encouraging organ donation” for example will be a reintroduction of the idea floated by the previous administration –  presumed consent. A highly unethical assumption that people who do not sign up can be assumed to consent without actually asking them. This logic is based upon the principle that people do not bother checking or un-checking the little boxes on forms they fill in. So the default is left at the one the government wants –  i.e. you have to actually make an effort to opt out. That is why it is so unethical, it actively takes advantage of peoples’ inbuilt tendency to inertia –  or failure to read the small print. Either way, it is sharp practice.

At this time of tight resources, it is essential that policymakers get value for money…

Indeed so. I would suggest slashing all government funded quangos and getting rid of all but absolutely necessary government departments. Stop wasting taxpayers’ money on wasteful junkets such as the Olympics and trying to host corrupt sporting events across the board –  and then stop pouring money into wasteful overseas aid except for immediate emergency relief.

…and in ways that enhance rather than restrict personal freedom.

Simple –  just get out of our lives. Stop telling us how to live. Stop stealing ever more of our money and pissing it up the wall. Stop assuming that you know best –  because you don’t.

Oh, but that isn’t what he means, is it?

That is why we set up the behavioural insight team, which will draw in expertise from across the world.

Oh, my gaaaawwwd! What was that I said about pissing money up the wall?

Yet one thing we can be certain about: between banning and doing nothing there are many choices.

And one of those choices is to leave us alone, but you won’t, will you? You just can’t help yourself.