So, I’ve started reading again: What money can’t buy

Recently I’ve cashed in some book vouchers and started reading “What Money Can’t Buy: The Moral Limits of Markets” by Michael Sandel. I am not an economics student, but reading about the way markets work and how deeply it has penetrated our lives was disturbing and interesting, but ultimately convincing me that it was a good decision I did not take up economics.

Here’s some interesting arguments Sandel makes:

1. Why should we worry about commercialisation of almost everything in our lives? In the past commercialisation stopped at the extent of luxury items, like a yacht or car or jewellery, and while that was bad because it put inequality on display (heck it even flaunted it), affluence now extends to buy basic accesses like medical care, home, education and political influence. A Birkin bag won’t cause any reduction in your neighbour’s quality of life, but the rich representing a disproportionate amount of basic accesses will deplete the poor’s resources and direct quality of life. Not only does it entrench inequality and causes unhappiness to the underprivileged, commercialisation also corrupts value and makes the rich unhappy too because “money can’t buy happiness” if intangibles like happiness becomes irreversibly corrupted. For that reason, we don’t sell children because that would corrupt the love/commitment/innocence that childhood represents.
2. The market is non-judgmental, which is fundamentally different from the way our society has always been organised by social norms and judgments. A market society is attractive because it doesn’t judge what you are selling, only asks how much, and that provides a relief for everyone no matter where your preferences lie. Only until recently did this particular anti-judgement school of thought become prominent in a society – prior to this societies rely on moral limits to condemn actions (since humans are social creatures our punitive methods correlate) are judgmental. Market society is attractive because it simplifies the conflicts arising from debating about the flimsy thing that is morals, and instead of making it difficult to find a unified answer to what is the better way to determine an object’s value rather than monetary, it simply embraces all things and appeases everyone.
3. The study of economics is transitioning from explaining market systems (demand and supply) to explaining human behaviour (everything we do is a choice may they be explicit or implicit). The invisible hand that acts upon items and commodities now becomes a heavy hand when we try to use incentives to motivate and shape human actions and decision making. This to me is the interesting portion of economics.
4. Economists object to gift giving because it is a social practice that doesn’t make utilitarian sense. Apparently, a study found that there is a 20% drop in satisfaction from receiving a gift compared to getting the same item yourself, and economists believe that rather than waste economic satisfaction, giving people cash maximises the utility and happiness derived as we get to choose the items ourselves. However, the fact that there is strange standoff-ish attitude towards thrusting people money as gift point to the fact that money can’t solve everything. Rather than giving cash, gift giving is expressive and sentimental, signalling the thoughtfulness of understanding a person rather than buying your way out of it. There are things that don’t make economic sense but are worthwhile in its own rights.
5. The market is insidious because it can shroud itself in a cloak of “good intentions”. There’s a rather interesting form of eco-tourism where legalised Black rhino hunting with a quota is used to encourage breeders and locals to preserve the endangered species in order to receive high compensation from trophy hunters. It is a strange market where you feel good for saving a species, but have to sacrifice the moral inhibitions of trophy hunting, albeit being controlled. Consider another conflicting market: Viatical, an industry where a third party buys off the life insurance of rich elderly and receive their payout upon their death, while compensating them handsomely in the time prior to their deaths to allow them to live their last moments wealthily and freely. It hides itself behind the social good of “look I’m helping the lives of dying people” but does not change the fundamental concept of having someone bet on you dying sooner so they could collect their payouts faster. Furthermore, this industry means that if a cure is developed for an illness, there’s actually people who stand to lose from it and would curse the medical development, as what happened with the AIDS outbreak (the investors who invested on the death of AIDS patient now lose big time with the life-prolonging cocktail of drugs). These industries trigger our moral gag reflex if you will, because it indicates that our moral baseline is enough to recognise how insidious it is, and highlight why all the more we need to struggle with moral dilemmas so as to maintain that baseline.
6. Insurance is commonplace now, but it used to be met with a cultural rejection of the commodification of death. Up till 19th century no one saw insurance as necessity because insurance originated in bars and pubs where people gamble on someone’s lives and when they will die. The exchange of money for death is marred by the association to winning something so flippant as a gamble. Eventually it evolved to becoming insuring to protect our loved ones, and now even a form of investment to withdraw large amounts of money for property and the likes and became as normal and commonplace as it is today. Notice how the inhibitions were overcome by justifying getting money upon death with doing some form of social good. Again, points towards how the economists’ mindset of cost benefit analysis shouldn’t be universally applied because it can change our attitude towards a subject (commodification of death) by repackaging the intent without changing its fundamentals. Even in death, you can be commodified. There is a type of insurance called the COLI insurance or janitor insurance, where employers get a payout upon an employees’ death. The employees are worth more dead than alive. Why should a corporation own a part of your life and profit off your death, especially when these insurances tend to make employers disregard workplace hazards (since they could get money from you dying anyways)? It is also morally distasteful because your life is being treated as commodity, truly degrading our individual sentient existence into cogs in the machinery of money-making corporations that are in themselves an illusion disconnected from an objective reality.

Here’s some things that I have some opinions on and thought it’d be interesting to examine:

1. Fast tracking is unfair
   1. In London, apparently the lines are ghastly and make for an absolutely horrendous experience, hence the invention of pricier tickets that come with a fast pass. In contrast though, Singapore is another one of those airports with high international traffic but praised for the experience and efficiency – there’s hardly any obscene waiting times and I’ve never understood the need for a fast pass. It goes to show that in policy-making, throwing money by adopting the market formula (buy the fast-pass) isn’t solving the root issue and instead breeds more inequality. The airport fast-tracking is the least offending inequality.
   2. An economist loathes waiting because it is inefficient, so the idea of fast tracking is to pay to cut the waiting time. Take how in America, the queues to get as seat during congressional hearings could be packed with people who were simply paid to stand in line to “chope” the place for officials who are too busy to waste their time queueing. Even though it is clearly unfair and irks people – it breeds a bullying attitude where it seems only money can make the world go round and accepting unfairness as a norm – it is difficult to argue against fast tracking because it can be argues that if one cared enough they would be willing to pay the price for the queue (either in money or in time). The market wants to delegate resources to those who value (and in this case it is a monetary value) them most highly afterall.
   3. Scalping for doctor’s appointment in China is another practice of fast-tracking where people without medical emergencies queue for appointments and sell their spot to the rich paying for line cutting rights in the packed hospitals. It is such an unfair practice because those queueing to sell their waiting number are congesting the queues for those in dire need but no financial means to access timely healthcare. Other than being unfair, this fast tracking industry is problematic because it rewards the middlemen and not the doctor or the patient, which if we were to allow the invisible hand to work its magic, would propel us towards lower skilled jobs that are more lucrative (like the middle-men who just had to be opportunistic enough to exploit these markets and willing enough to waste their time). Apparently, the middle-men earns more from a single consultation slot than the doctor and that’s saying something.
   4. A society run by these market rules of fast tracking ultimately forces an individual to make the decision, whether they value the extra money or they value their time. The common assumption is that the rich are busier and hence are poorer on the latter resource, but nothing about this apparent discrimination isn’t fairly applied because the inverse isn’t true for those short on monetary resources. The poor usually are also busy trying to make ends meet and aren’t swimming in obscene amounts of time. In fact, time is something equally limiting for everyone – 24 hours a day that’s all we get, whereas there isn’t a limit to how much money one can possess. Perhaps when we think about how “inequality looks like”, especially in a city like Singapore, we shouldn’t’ think of the visually striking segregation in Brazil of the slums and high-rise divide, but think about an amusement park on weekends where some skirt by the plebian masses with their pricy express queue while the rest watch on enviously. Or, we could approach it from a different perspective: all that rant about unfairness is just us playing into the palms of large conglomerates who soothe our impatience with a “balm of fairness” as a business tactic and less as a well-intentioned social good.
   5. The only sectors that haven’t yet succumbed to paying in our willingness to wait is in selling a house (waiting or paying more doesn’t convince people to let up their estates faster), universities’ admissions (everyone has to take standardised tests and ideally are qualified by merits) and hospital ER (it’s a matter of life and death). Housing, education and healthcare are public goods and we can only hope that they will stay free of the perverse market reasoning.  
2. Economic principles seeping into our incentive reward system in the forms of bribery should be approached with caution.
   1. There are the harmless ones, like paying kids to score well is a form of bribery and conflates motivation for studying with economic incentives. We don’t see much problem with it, nor do we bat an eye at scholarships (especially in Singapore) that is essentially rewarding students for good performance. How about health incentives in America where they pay obese people to lose weight or smokers to stop smoking – when does it become manipulative and corrupting of the attitude we should have towards our body? Why should we be paid to do what is the bare minimum of keeping ourselves healthy? Here I think: it is even against the spirit of natural selection for governments to try to cradle these people who refuse to take care of themselves without economic incentives, but evolution and devolution goes hand in hand.
   2. How about paying for the right to immigrate such that the financial barrier will attract the “right” type of immigrants we want? Or a refugee market where all countries are obligated to take in refugees (thereby contributing to a social good) but countries can sell their refugee quotas to economically disadvantaged neighbours (thereby contributing to an economic good)? These are increasingly morally ambiguous and should prompt us to answer why we should have a moral stance with regards of using economic means as incentives.
   1. An interesting concept of why economic incentives don’t work is because fines become fees instead and corrupts the original purpose. A fine and fee are both monetary in nature, but the former is different because it carries along the baggage of moral judgement. An Israeli study found that childcare centres that implemented a charge on parents who are late to pick up their children saw a large increase in parents who were late because now instead of the guilt of being late for their child, they treated the “fine” as a price to pay for the childcare centre to look after their child a little longer. See, without morality working in tandem with our incentives system, deterrence doesn’t work. Most of the time governments implement fines but it’s the citizens who have adopted the market view point that treat it as a fee. China’s punishment for couples breaking the one child policy was initially a fine, but with rich enough parents who don’t mind paying up to have another child, the government soon found that they had to resort to defaming and affecting these couple’s public image as a form of dissuasion. Monetary punishment no longer works.
3. A market society corrupts our idea of humanity, and I think it is a great irony that economics should be considered a part of humanities.
   1. On a physical level, money demeans the value of a body. This person called Barbara Harris wanted to save children who were born into families with a drug addict, and hence paid drug addicted women to be sterilised. While it helps solve the problem, it corrupts the idea of babies and fertility, and one might even think of Singapore’s campaign to increase fertility as the other side of the coin. Advertising companies that pay people to tattoo a brand onto their forehead or other body parts, or paint a house, or paste stickers on cars, degrades our privacy and ownership over every aspect of our lives.
   2. On a more symbolic level, money corrupts the meaning of intangible values. Websites that allows one to buy an apology or wedding toast might do the job better, but does it make it better or less sincere? And would you then appraise the value of the apology/toast by how much it costs? Money can’t buy friendship either, no matter how much a you pay a person to be your companion because it corrupts the meaning of friends. The idea of good citizenship can also be degraded by money. The government in Switzerland wanted to build a new Swiss nuclear disposal ground which is understandably unpopular because of the health implications, but 51% of local residents agreed to the plan out of civic responsibility. However, once monetary compensation was brought in, the resident’s acceptance dropped by half because to them it seems like the government is bribing them to give up their land. When compensating most citizens prefer it being in a form of a public good such as school or other amenities as it aligns with their civic responsibilities and motivation. The commercialisation effect, or crowding out effect, demotivates people when money is brought in to corrupt intrinsically good or charitable deeds
   3. The very central idea of public service is also in jeopardy if we run ourselves purely on economic reasoning. American states gain a new means to finance community projects or neighbourhood upgrade through municipal marketing and selling out naming rights of beaches, train stations and parks. However, how should a citizen feel if these public amenities were part of a trade with a corporation who wants to plaster the location with their own advertisement rather than keeping their interest in mind? KFC could buy fire hydrants to advertise their flaming hot chicken. Even police cars were once proposed to be provided to the state on a $1 rental vs the cost of $28000 to acquire a new police car if corporations were allowed to plaster their advertisement on the cars. Eventually that was rejected because the meaning of law enforcements and value of public good is demeaned Look at advertising in school, having corporate sponsored publications intruding upon the sacred space for learning. There was even once where Campbell’s spaghetti sauce was gifted to schools as part of a “science kit” but really was just an advertising tactic to target the palettes of students. It makes us deeply uncomfortable to see the market over-reaching into these aspects of our public life.
4. Economics pose a very fundamental question on how we want to move forward as a society because choosing the market solution can be startlingly efficient but takes away from our moral baseline. Terrorism futures market is a type of market proposed by the Pentagon, for the rich and powerful to bet on terrorist attacks or fall of political leaders. Since money is on the line, the market will work its magic and people will look for intelligence that they can trust and the vote of confidence in betting for a particular outcome must suggest some likelihood. It would surely do a lot of national security because the market is a great intelligence pool. The easier question is: does it work on political events that are by nature a second level chaos (which means the outcome will react to predictions such as people betting money on it)? The more important question is: isn’t it morally repugnant for a government to endorse betting on tragedy, death and violence, and is this really a sacrifice we are willing to make? Sure it could efficiently gather intelligence, but that means the government has to openly endorse such under-handed methods (I’m sure in politics they have their dark underbellies but it is rather depressing if our society becomes one where these dirty laundries can be shamelessly and openly displayed as common knowledge). What are we willing to sell for money? And what can’t money buy? I choose to resist making a decision purely because the solution is more efficient and to consider the moral implications of making that endorsement. Perhaps this clinging onto the relief of having a moral compass might inhibit our progress, but as humans we should all have something that would make us balk and stop to think and say “no” to.