Morality and Unintended Consequences
Intentions do not equal results. People have goals and act to fulfill those goals, but that does not mean they are successful. The world is a complex place and even simple actions can affect many people. Intervention in complex systems may or may not have the intended result, but may create unanticipated and undesirable outcomes. The interplay between intentions and results is interesting from a moral perspective, because the morality of an action is dependent on the both the intentions of an action and its’ consequences.
Perhaps one of the reasons why people care more about intentions than results is that intentions are controllable. It is much easier to try to do good than to do good. It doesn’t take intelligence or even much effort. Trying to figure out the likely consequences of one’s actions is difficult and unpleasent. In my personal moral system, one must have three virtues to be moral: Courage, Love and Wisdom. Love is the virtue that allows people to empathize with one another. Courage is the strength to do what is right through adversity. It includes self control, temperance and determination. Wisdom is a virtue that fewer people focus on. Wisdom is the virtue of knowing what actions to take which will lead to good outcomes. It allows us to balence our goals and methods to be effective at solving problems. For example, feeding the hungry is a very important moral goal. Collectivizing food production – that is giving each person an equal share of food no matter what they produce – seems like a good way to ensure no one goes hungry. However, virtually whenever this has been tried, it has led to mass famine. Better to allow people to reap the rewards they sow, and then if some are still hungry, provide them with enough to survive. Wisdom allows us to see past the indended consequences, and analyze the possible unintended consequences and determine if the proposed action still morally right.
If intentions are altruistic and the results are good, we call that virtue. If intentions are bad and the results are bad, we call that vice, or sin. When the intentions are good, but the results are bad, that is love without wisdom. People rarely consider the category of people whose actions are selfish, but the results are beneficial to others. Many market transactions fall into this last category. Voluntary, informed trade is mutually beneficial. Everyone who contributes to the web of trade allows others to become more specialized and thus leads to an increasing level of prosperity for everyone else.
The more society can promote good outcomes without requiring large self-sacrifice, the better, because virtue is scarce. Virtue helps society move smoothly and without it, society would quickly collapse into a Hobbsean “State of Nature”. However, not everyone is virtuous. Society has both saints and scoundrels, and so the rules of society must be able to handle the full spectrum of human action. We need both police and charities. Setting up society so that it can function with only a small amount of virtue means that it will be more resilient in times when scoundrels outnumber saints. That is why it is important to know when and if societal structures will lead to good outcomes even if there are mostly selfish intentions.
Actions with good intentions and bad outcomes are morally wrong as they lack wisdom. How then does a moral individual try to avoid them? The types of actions likely to have bad unintended consequences are those which are complex, require lots of people cooperating and affect the distant future or other hard to predict patterns. Anything that alters the incentive structure that people face will cause them to react to those incentives. “The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.” By tracing the effects of an action across a larger group, one can identify the pleading of special interests and also consider if there are any negative effects on a small group. Frequently in public policy actions, there are two groups advocating an action: those who think it is the right thing to do and those who are selfish. This phenomenon is called Bootleggers and Baptists. For example, if the government proposed to outlaw alcohol, Baptists would be in favor of it because it would reduce drinking. However, Bootleggers would also be in favor of it because banning legal alcohol would allow them to make a large profit from smuggling.
It is important to consider the impact of policies on society as a whole, not just a small group. For example, consider the minimum wage. By putting a floor on the wage, policy-makers intend to direct more money towards the poor. However, because a price floor reduces the quantity of labor demanded, unemployment increases. Depending on the slopes of the supply and demand curve, employment*wage (amount of money going to the working poor) could actually decrease if the wage increase does not outweigh the decrease in employment. The intention of the legislators is not to decrease the amount of money going to the poor, but that might be the result. Humans react to incentives. If an activity becomes more expensive, people do it less. There was a yacht tax which caused massive losses of jobs in the boating industry because buyers were able to buy yachts outside the U.S. and sail them in instead. When the government bailouts out banks which engaged in risky behavior, they avoid economic damage to the banking sector in the short run, but in the long run, risky behavior is encouraged.
Human beings are not good at thinking through all of the unintended consequences of our actions. We evolved in small, tight knit groups where actions did not have profound, far reaching effects. When things were not going well, they could be quickly changed without a big fuss. Modern society is completely different. Laws affect millions of people, and can’t be changed without massively costly litigation and legislation. There are few and slow feedback mechanisms to change poorly designed rules, which can hurt a society for decades before being changed or replaced. All the more reason to properly think through rules and actions before doing them.