Just got out of a fascinating, if not slightly evangelical talk by Bryan Caplan from Mason University. He believes that the greatest obstacle to sound economic policy is not entrenched special interests or rampant lobbying, but the popular misconceptions, irrational beliefs, and personal biases held by ordinary voters. Caplan argues that voters continually elect politicians who either share biases or else pretend to, resulting in bad politics winning again and again by popular demand.
With all of the tech conferences I've attended I've noticed how the audiences seem to hold broadly similar convictions. Liberal, progressive, glass half full kinda delegates. The panellists and the keynotes tend to reinforce these beliefs rather than challenge them. Caplan delivered one of the few talks I've attended where his views caused angrily reactions and tut-tutting.
Caplan broadly called into question our most basic assumptions about politics and democracy. He contended that democracy fails precisely because it does what voters want. He's been busy analysing Americans' voting behaviour and opinions on a range of economic issues. He went on to state that all non-economists suffer from four prevailing biases: they underestimate the wisdom of market mechanism, distrust foreigners, undervalue the beliefs of conserving labour and pessimistically believe the economy is going from bad to worse. Caplan came up with some broad but uncomfortable suggestions for policies that would really tackle some of today's thornier issues:
1) Raise the price of driving during peak times
2) Reduce tax on those willing to sign the organ donor register
3) Tax pollution
4) Reduce tax on consumers buying from developing nations
5) Place a surtax on the wages of guest workers
Ultimately, I find it almost impossible to believe anyone who genuinely feels that economics and the market can deliver THE answer but genuinely admired his academic fervour and unflinching look at problems that have dogged us for decades.