David R. Henderson  

A Better Analogy for David Friedman

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Motorcycles, not Cars

Yesterday, in my Cost/Benefit Analysis course, I covered the highlights of public choice. One of the pieces I like to use is a short chapter from David Friedman's modern classic, The Machinery of Freedom. The chapter is titled "And, as a Free Bonus."

Here's a key paragraph:

When you elect a politician, you buy nothing but promises. You may know how one politician ran the country for the past four years, but not how his competitor might have run it. You can compare 1968 Fords, Chryslers, and Volkswagens, but nobody will ever be able to compare the Nixon administration of 1968 with the Humphrey and Wallace administrations of the same year. It is as if we had only Fords from 1920 to 1928, Chryslers from 1928 to 1936, and then had to decide what firm would make a better car for the next four years. Perhaps an expert automotive engineer could make an educated guess as to whether Ford had used the technology of 1920 to satisfy the demands of 1920 better than Chrysler had used the technology of 1928 to satisfy the demands of 1928. The rest of us might just as well flip a coin. If you throw in Volkswagen or American Motors, which had not made any cars in America but wanted to, the situation becomes still worse. Each of us would have to know every firm intimately in order to have any reasonable basis for deciding which we preferred.

This was originally written, by the way, in 1973 or earlier, which explains the presence of American Motors and the absence of Nissan, Toyota, Honda, etc.

A student of mine, Kurt Celis, said that there was a problem with the analogy. A better analogy, he said, is that both of the major candidates for President are like motorcycle companies. So, for example, being a U.S. Senator is like producing motorcycles. In 2008, we got to choose between two guys who had been Senators (producing motorcycles.) We can look and see how good they are at producing motorcycles. But then, on that basis, we must decide how good we think they would be at making cars. In other words, the choice we must make is even tougher than David Friedman said.


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CATEGORIES: Public Choice Theory



COMMENTS (9 to date)
Saturos writes:

But we can compare the simultaneous performance of separate parties in different states.

joeftansey writes:

"We can look and see how good they are at producing motorcycles. But then, on that basis, we must decide how good we think they would be at making cars. In other words, the choice we must make is even tougher than David Friedman said."

Shouldn't that make our choice easier? Motorcycles and cars are both vehicles. The Senate and Presidency are both political management organizations. Performance should translate at least a little...

And even if motorcycle construction had nothing to do with car manufacturing, it's still a strong signal of competence.

David R. Henderson writes:

@joeftansey,
I’m guessing you didn’t read David’s chapter.

Ken B writes:

joeftansey:

And even if motorcycle construction had nothing to do with car manufacturing, it's still a strong signal of competence

Could Luciano Pavarotti do your job Joe? Because he was a very good operatic tenor, and surely that's a strong signal of competence.

Jeff writes:

This may be the dumbest thing you've ever posted. Manufacturers of cars and motorcycles try to make things people will buy. You can say that politicians also do this, but in their case the product is promises they hope you'll buy. But the whole point of public choice is that because politicians are really pursuing their own interests rather than yours, the promises they make are worthless.

Tom West writes:

But the whole point of public choice is that because politicians are really pursuing their own interests rather than yours, the promises they make are worthless.

Isn't the point to choose politicians whose interest is to do a good job? Oddly enough, having no practical way of comparing future performance (or even past performance), I choose which professionals to employ by exactly the same mechanism - specifically their promises and my judge of their character.

I have to say, I find it odd to imagine a life where the assumption is that pursuit of one's interests is equated with extracting the maximum one can from a relationship without getting caught. Certainly doesn't match my experience with all but the thinnest slice of humanity.

Jeff writes:

But politics as a career selects for that "thinnest slice of humanity". A good liar has a huge advantage in politics. The last president I can think of who doesn't seem to have made a regular practice of lying for political or personal advantage was Dwight D. Eisenhower. Admittedly, that was before my time, but he does seem to have confined his lies to national security matters like the U2 flights.

And no, the point is not to choose politicians whose interest is to do a good job. The point should be to sharply limit the amount of power you give these bums and thereby limit the damage they can do. There are a few politicians who say they agree with that point of view, but they are the exception, not the rule. And you don't know until they are in power whether or not they are lying about it.

Kurt Celis writes:

I don't know that it would make our choice more difficult. In fact, it might make it easier. I think that we can gauge future success based on past success. So if motorcycle manufacturer A produces better motorcycles than motorcycle manufacturer B, I would venture to say that manufacturer A would also be better at manufacturing cars.

In the same regard, if Senator A is better than Senator B, I would venture to say that Senator A would also be better at being President. This compares them doing a similar job at the same time, as opposed to a similar job at different times.

Going further, I think that if manufacturer B has already proved to not make very good cars, we should probably give manufacturer A a shot at it. The cars can't get much worse, can they?

Seth writes:

It's more like picking an NFL head coach based on who's the best looking TV weatherman.

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