(I’ve written about incentives in government before. Just once or twice.)
When I get to debating people who aren’t libertarians, I’m often told that the profit motive is the source of miserly, predatory, rapacious, and otherwise thoroughly unpleasant behaviour. (This is of course occasionally true.) I am then usually told that this demonstrates the superiority of public systems to private ones, as the government doesn’t care how much anything costs and is thus not beholden to the eee-ville profit motive. I then point out the stunningly obvious counterexample of the People’s Republic of China, and they change the subject.
There is, however, another side to the argument. Rather than debate the degree to which thuh gummint is subject to the profit motive, we should ask (first) what other options are available and (second) whether they’re any better.
Before we do that we should realize that there’s no such thing as “the government’s motive” — governments, like all organizations, are composed of individuals, each of whom has one or more motivations, and many of which are germane to the argument. When applied to individuals, “the profit motive” isn’t really a motive in the same sense as self-preservation or altruism: it’s an incentive. Profit is a reward for certain kinds of behaviour. Sell more widgets, or produce them more cheaply, and — all things being equal — you make a bigger profit. Things like stock options were introduced as devices to make individual employees care more about corporate profits. (And they turned out to be imperfect devices, but we could’ve seen that coming.)
Operating under the eminently reasonable assumption that rewarding a behaviour gets you more of it, let’s look at what kind of incentives are provided to government employees. We’ve already seen a dismal example from Great Britain; Radley Balko provides another from the United States’ criminal justice system:
- Five Questions for Radley Balko (The Economist)
At every step in the process, the incentive is toward putting people in jail. And there’s almost no penalty at all for state actors who overstep their authority. Police departments, for example, get federal anti-drug grants based in large part on how many people they arrest on drug charges. After the botched drug raid in Atlanta a few years ago in which a raiding police team shot and killed an innocent 92-year-old woman, we learned in subsequent investigations that officers had monthly quotas for drug arrests and drug seizures.
But the incentive problems are most apparent with prosecutors. Prosecutors get no credit for cases they decide not to bring, either because of a lack of evidence or because pressing charges wouldn’t be in the interest of justice. They’re only rewarded for winning convictions. That’s what gets them promoted, or re-elected, or gives them the elevated profile to run for higher office. Every incentive points toward winning convictions. And particularly with prosecutors, there’s really no penalty at all for going too far to get a guilty verdict. One real disservice the Duke lacrosse case did for the criminal-justice system is it put in the public consciousness the idea that bad actors like Mike Nifong are regularly disciplined for misconduct. In truth, that case was really exceptional.
(Hat tip: Andrew Sullivan)
The problem these incentives create — that number of convictions matters more than guilt or innocence* — can’t properly be understood in fairy-tale terms, where prosecutors like Mike Nifong are cackling villains in stovepipe hats and silk-lined capes who set out every day to revel in the misery of others. As Balko explains, we’ve created a system where prosecutors have a strong extrinsic incentive to maximize convictions, with no countervailing extrinsic** incentive to minimize wrongful convictions. And, guess what? They tend to follow those incentives.
Tell me again how that’s more noble than the profit motive?
* Or for that matter the apparently-trivial matter of right or wrong.
** Satisfying though it is to tar a whole profession with the simple-minded brush of stereotype, I’m gonna go out on a limb here and assume that most prosecutors do their level best to avoid convicting innocent people. See also, however, Three Felonies a Day.