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Jovan has asked me to reflect on how to determine the “public interest”. As a lazy skeptic I’ve shied away from the subject. It is at the crossroads of epistemology, chaos theory, political science, and consciousness – and much more. I feel like the old man in the movie: The Pink Panther. It is night, and the Pink Panther jewel has just been stolen from Princess Dalah’s villa. A bevvy of blaring cars rushes about in hot pursuit of the villain. Their frenzied paths all cross in a venerable square: out of the night cars emerge, and rush into the darkness at the other end under the bemused eyes of old man who is trying to cross in order to go home after the bar has closed. As the cars all crunch up on a pile of smoking metal, blaring away in impotent urgency, as the old man dodders back to the chair in front of the bar. Such is life in the world of “the truth”.
Put it another way: the blog entries are no more than the chattering guide’s comment to your visit to the Disneyland of public philosophy….
Is there an objective and true “public interest”? – this is the first thing one ought to discuss upon undertaking such a quixotic quest.
Plato (and goodly part of Western philosophy) argues that there is a public interest, which is –as all truth – transcendent. Transcendent means “perfect and eternal” – out there in the distant world of ideas – and therefore unchanging while contingent reality changes. It is incumbent upon the philosopher to seek the truth.
Other philosophies – in particular Asian ones – would also argue for true, albeit immanent public interest. Such truth unfolds in time, forever evolving and changing – but revealing itself. The dialectic of yin and yang yields chi – the “spirit” or the “way” – which is harmonious. Here the philosopher observes (and at best facilitates) the emergent truth.
Unchanging perfection or harmony – both worldviews converge in the belief that there is order underlying the chaotic disorder we observe on a daily basis. The only question is whether this order is static or dynamic. Either way, both worldviews provide legitimacy for authority (be it personal or traditional).
In Plato’s worldview error – sin – is confirmation of distance between reality and ideal. In the Asian worldview error is betrayal of the mandate to seek harmony – leading to “loss of face” – and then “loss of mandate”. In the West “original sin” is at the beginning, in Asia it is “impending”.
In both cultures visual art provide metaphors for the respective worldviews. Western paintings are “windows” on reality. Standing before (and away from) the painting the observer perceives the truth – the artist being the philosopher who has traced the path. The vanishing point, which organizes the painting’s perspective, is the ordering truth.
Asian painting invites the observer to enter into reality and partake of the revelation of the truth. In many such paintings there is even a small human form, to which our gaze is mysteriously attracted, and we feel like joining.
Adam Smith and the “Vienna School” of philosophy implicitly build a synthesis between the two worldviews. They observe the “invisible hand” at work, which emerges from human interactions – it is also an immanent reality. On this emergent property they bestow transcendent “harmony” – attempts to meddle with the “invisible hand” are counterproductive and doomed. So the “public interest” is both affirmed and denied – it exists, but is beyond reach.
These worldviews posit a global framework – they aim to present a coherent and consistent view of reality. At the same time they place themselves at a distance from reality as we experience it. The empiricist’s uneasiness with worldviews, which start from “first principles”, lingers on.
There is a more modest empirical worldview – consequentialism – which sees reality as “evolving through local modification”. Life is contingent and chaotic. At any point in time humanity can modify it – by trial and error, for we have no a priori way of determining the direction of the modification – to achieve what it perceives as an improvement over the previous condition. Such change might be justified – but accumulation of such changes does not necessarily lead to progress. An analogy would be to observe that as hippos mutate into wales one cannot say that the outcome is in any way “better” or closer to an ideal, or harmony.
The fundamental difference now becomes evident. Authority is dethroned and becomes the contingent outcome. “Public interest” is nothing more than the will of the participants as expressed at any point in time – subjective “will” of the public.
“Will” is neither unfettered nor perfect – it is not Nietzschean. It is subject to all sorts of constraining conditions ranging from the imperfection of the human brain to our being embedded in our social system. Authority is dethroned and replaced by “good enough” and “best efforts”. Not much to go on – so we should use it lightly, with lots of modesty, and more than a touch of self-deprecating irony.
It has not escaped my slothful attention that the consequentialist point of view – I would hardly call it “worldview” – could dispense with much metaphysical rumination. Pass Occam’s Razor, please.
 See: C. P. FITZGERALD (1964): The Chinese view of their place in the world. Oxford University Press, Oxford.
 See: Hans BELTING (2009): Florenz und Bagdad. Eine westöstliche Geschichte des Blicks. H. C. Beck, München.
 See: Brian ROTMAN (1993): Signifying nothing. The semeiotics of zero. Stanford University Press, Stanford.
 See: François CHENG (2008): Cinq méditations sur la beauté. Albin Michel, Paris.
It’s over 40 years now that I’ve encountered Arrow’s Impossibility Theorem and the Theorem of Second Best. I’ve toiled under them with the likes of AKERLOF, McFADDEN, MALINVAUD – no, I never did set foot in DEBREU’s den: too many floors up Dwinelle Hall for my economically weak legs. To make matters worse, Blue Meanies were loose on campus at the time.
I’ve long left the area of welfare economics to better economists than myself. Amartya SEN spent well over a decade trying to undo ARROW – he failed. He got a well-deserved “Economics Nobel Prize” anyway. My loss.
In economics one is told that individual wishes and desires can be made to fit one into the other like Russian matrioskas – this mysterious thing called “utility”, which is based on absolute if not perfect rationality. The real world is something else, which means it has precedence over fatuous Platonism, which I demolished gently.
Public goods? According to your definition intellectual property would be a public good. That’s why Art. 8 of the US Constitution stipulates a bounty – an exception from the market mechanism to reward the inventor, without depriving the society as a whole of the invention’s benefits. Try arguing this at the Annual Meeting of the AEA.
Where the “utilitarian” view can mislead I have shown in some past blog entry of mine – when I argued against what I call, tongue in cheek, “The Fallacy of the Commons”. I also published a comment on the whole subject in World Economics, a couple of years ago. Never was more absurd an article written by utterly an incompetent demographer more influential (which stems from the fact no one ever read it, I suspect). I predicted the failure of Copenhagen – in writing. Jan TINBERGEN (another “Economics Nobel Prize” Winner) had done so over fifty years before: that’s why I could be so bold.
My gentle conclusion – consequentialism – leads directly to another “Economics Nobel Prize” Winner: Ms OSTROM, who has made mincemeat of Hardin and the maximizing crowd. Go for a local solution – it focuses usually on an institutional setup, which implies feasibility – and forget “social optimum”. “Social optimum” is uplifting dust thrown into the eyes of the public while the rent is absconded. COASE had said as much, but more eloquently, decades ago (from an efficiency point of view it does not matter whether the railway pays the farmer or the farmer pays the railway – it is a convention).
You want to know how it works in practice? Fast rewind to 1900. Both Russia and the USA then had lousy farmers. Both worried about “feeding future generations”. The Russian took the road of central planning, social choices, and Soviet agriculture. The USA created the USDA-Extension Service. It wanted simply to teach farmers better ways of growing food. The “future generations” are today’s consumers. Guess who is feeding them?
And if you want me to get really worked up, take (Lord) STERN’s “social interest rate”, which is supposed to arbitrate between present and future generations (one subject you seem concerned about).I’ll skip lightly over the implied paternalism of the whole approach, and the underlying circular reasoning. Remember SAMUELSON: “DON’T do onto other what you’d like to be done to you – they may have different tastes”. No matter which decisions you take now you create a “path-dependent outcome” for the next generation just as much as the last generation did for us – pace poor old MISHAN (“The costs of growth”) who wanted the cake and eat it too. As for the “costs”: if the industrial revolution had not polluted on its way to economic development, we would still be living in shacks for want of growth. Now that we are rich we have the means to clean up the mess our forefathers bequeathed to us together with their wealth.
Where I get tiresomely critical is where (Lord) STERN selectively uses his “social interest rate” to push his pet topic – preventing climate change. Were we to use the “social interest rate” in a coherent and consistent fashion, you’d see projects like the elimination of enteric diseases (clean water etc.) take top priority. My heart bleeds for those who want to “save future generations”, but won’t lift a planning (or budgetary) finger to save one million lives each year – NOW.
This is a bit of background to my “philosophical description”. At any point in time you may either query the (mostly silent) assumptions, or verify and develop deductions from the axioms. No amount of ingenuity will help you when axioms are essentially wrong. Which is the case. Our Western categorical mind-set stands on the weakest of reeds – that we are rational, and that the world is a “closed” and non-contradictory system.
As Marx said: Revolt against conventional wisdom – you can only lose your “intellectual” chains.
Just liked this philosophical
Just liked this philosophical description and indeed derivation of ‘public interest’. However coming from a different ‘Worldview’ of the economists – we tend to understand public interest more in terms of welfare or ulitity maximisation. Public interests contrasts private interest and generate the need for social good. While private interests concerns making rational decisions about individual choices say maximisation of utility form consumption of a good or a combination of goods, public interests considers replication of such choices by a group of individuals. The public interests, can be better illustrated through consumption of what economists refer to as “public goods” – those whose consumption by one individual does not stop or deprive others from enjoying the same eg. using public utilities like roads, rails or public water points. Public interest is a key consideration under natural resource economics to assist in preservation of “common property resources” such as water bodies and reserved forestry land. It prompts collective action and collective responsibility over these resources. Finally, sustainable development – a development that takes care of needs of the present generation without compromising on those of the future generation cannot be a reality minus public interest. Thus is assists in making inter-temporal choices as well!!! Hope you will enjoy this viewpoint