Nicholas Gruen is coming to town next weekend, Sunday Oct 9.

It is a long way from home so he might appreciate some convivial company.

What if we make this an opportunity for a bloggers night out?

How about the Clock Hotel in Crown Street, Surry Hills?

Any takers, any other suggestions for a venue?

I can’t quite put my finger on it, but I find the Australia Institute’s latest effort (pdf) particularly irksome. It uses data from Roy Morgan to describe the drivers of four wheel drives as unusually aggressive, lacking in community mindedness and various other things.

Sometimes the data as quoted suggests this, and sometimes it barely does but much is made of relatively small differences. A good flavour of the paper is given by this extract.

40 per cent of city drivers of large 4WDs agree with the proposition that homosexuality is immoral, compared with just over a third (35 per cent) of Australians in general. Previous research by the Australia Institute makes it clear that men are more likely to agree with this statement than women (Flood & Hamilton, 2005). Among male drivers of 4WDs in the city, 51 per cent agree with the statement that homosexuality is immoral (compared to 43 per cent of men overall)

The final section ‘Some Implications” ends as follows.

The data reported in this paper suggest that there is a self-perception of ruggedness amongst the drivers of large 4WDs in the city. They are also more inclined to a conservative, individualistic point of view. This suggests that relying on the social conscience of large 4WD owners to change to safer, less aggressive vehicles may be less effective than mandatory measures such as special licences and high taxes.

I should say I’m quite happy with charging the drivers of 4WD whatever we take their external costs to be. I don’t drive one myself, but don’t find them irksome on the road. I also haven’t found their drivers more agressive than others as the paper reports (though it seems to report ‘opinion’ to this effect.)

The paradox for me is that if I encounter people who are aggressive and anti-social I dislike them intensely. And there is probably something in the paper’s stereotyping.

Yet for me, there’s something odious about the whole exercise. As a matter of political principle I think the stereotyping of groups of people like this is nasty and divisive. It reminds me of someone I knew in my student days who was against duck shooting. Not against eating the damn things, just didn’t like the idea and wanted to ban it. I felt quite sympathetic to her view then, but got talked round by some people I respected much more who thought the idea was that of a busybody and of a snob. That’s just the beginning of what I think about this paper I think it’s quite creepy. But I still can’t fully express why.

The story in the two posts so far in which some foreshadowing of what’s to come is snuck in.

Smith’s great work in sociology and psychology The Theory of Moral Sentiments (TMS) shares a deep logical symmetry with his (now) more famous work The Wealth of Nations (WN). That symmetry can be explained in varying degrees of detail, but at it’s simplest, Smith’s bottom line in both works is this:

For humanity to prosper whether socially, psychologically or economically the power of self-love must be constrained by equally powerful forces.

In TMS the force that tames self-love is ‘sympathy’. Note however that in Smith’s hands sympathy is not ‘benevolence’. It is the need to see ourselves not just as a solitary psychological atom with feelings completely internal to ourselves but rather as a being within a social context. ‘Sympathy’ can act as a civilising counterweight to the power of self-love because, unlike benevolence which is typically weak, sympathy is an elemental and existential craving in our makeup. It is the ‘I’ that must feel part of a ‘we’ and indeed the ‘I’ that cannot exist except as part of a ‘we’.

It is only within society for instance amongst family, friends, acquaintances or strangers that the thirst for the sympathy of others (not to mention their thirst for our sympathy) can be assuaged. This in turn guides people’s psychological development and socialisation as they internalise what others might think of them. The more fully they develop the stronger becomes their conscience an ‘impartial spectator’ which passes judgement on them. Thus people and societies grow together. The filaments of culture that stretch out through a society grow from our cravings for each others’ sympathy just a cattle or sheep path grows from the accumulating effect of each animal’s footfalls.

The same communicative urges underlie the ubiquitous tendency for humans to truck, barter and exchange and it is this which dominates in the economic sphere. Again Smith is more interested in the way in which self interest is constrained in this case by others’ self interest than he is in there being any merit utilitarian or otherwise in self-interest in itself. And not surprisingly this is the foundation of Smith’s case for his system of ‘natural liberty’ and his argument that commerce leads to human betterment both materially and morally.

Why does Smith think that markets are conducive to moral improvement or virtue or rather that they each grow together?
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As readers of an earlier post will know, I’ve become interested in the arguments that suggest that greater deregulation of land usage could improve land usage and in the process lower house prices to the great benefit of those trying to buy their way into the market.

Here’s the resulting column. It’s rather less assertive than Michael Duffy’s column on a similar theme.
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Crikey outlines how much more engagement there is in political campaigning over there.

And Tim Colebatch says some things that are similar to my own thoughts about the upshot of the NZ elections – namely that the power of incumbency combined with the power of being seen to work constructively on the problems of the nation can overcome the power of dog whistling to our darker side and of irresponsible promises by an Opposition.

In 2000, out of the blue, the OECD rang me and asked me to present a paper I’d written to their senior treasury officials meeting (That’s Treasury and/or Finance Secretaries). The paper advocated refashioning fiscal policy in the image of monetary policy.

I decided to do what I could to present a similar paper elsewhere on my trip and e-mailed Demos. No reply. I e-mailed again with the same result. I then phoned and got to talk to Tom Bentley who was the much hyped 26 year old Exec Director there.

He said someone would be in touch. Alas no progress was made. I rang again and got the same assurance and the same ultimate result. I ended up giving the paper at the IEA. People were very polite but many people wondered whether it was a left wing plot – it wasn’t. (They prefer right wing plots.)

For the plane trip I bought a book by Charles Leadbeater on the new economy called Living on Thin Air. It was a nice racy read for a policy book but I gradually became impatient with it’s breezy style. When he got to the bit about how people might choose their own social security system by opting into different tax levels with different benefit levels, I wondered where the discussion of the problems was. You know, moral hazard, adverse selection the kind of thing that insurance companies have wrestled with for many a generation.

(As a not entirely irrelevant aside, you used to be able to get insurance against being retrenched. Not any more. It’s too easy to arrange. Moral hazard and adverse selection mean it can’t be offered).

Anyway the book sits on my shelf but as a small sign that I am able to learn I’m not returning to it. From memory there was no discussion of such issues. (It’s probably more likely that there are a few breezy comments. But no real engagement). It just all seemed like a good idea at the time.

At any rate I was prompted to record these recollections on encountering this profile on Demos published by The Independent Newspaper.
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