As I noted in my last post, some advocates of libertarian paternalism try to get around the problem of political ignorance by suggesting that their policies be implemented by government-appointed experts rather than by elected officials. This is not a new argument. Totalitarians from Plato to Lenin have argued that the ignorance of the masses can be offset by concentrating power in the hands of an expert elite. So too have some moderate liberal scholars such as Supreme Court Justice Stephen Breyer and even libertarian Bryan Caplan. Breyer, the libertarian paternalists, and Caplan would never think of taking the argument as far as Plato or Lenin. But the core logic is similar: the experts know better than the average person - and therefore they should make the decisions.
For advocates of limited government, the rule of experts is like the vampire that refuses to die no matter how often we drive a stake through its heart. We've been fighting it for 2500 years, but have never quite managed to finish it off. Nevertheless, I'm going to put on my vampire slayer hat, and take a wee little stab at it.
As a solution to the problem of political ignorance, the rule of experts has major shortcomings relative to letting individuals make their own decisions with the help of markets and civil society.
First, it is essential to recognize that individual consumers don't have to rely on government for expertise. They can hire their own experts in the market or rely on more knowledgeable friends and acquiantances. When I get seriously ill, I go to a doctor. When I decide how to invest my money, I rely on the advice of friends who work in venture capital and investment banking. The real question is not whether we are going to rely on experts to help us make decision, but who gets to choose the experts and whether or not the experts will have veto power over the final decision on what to do.
I. Who Gets to Choose the Experts?
If instead of each individual choosing his or her own experts, there is a single set of specialists chosen in democratic elections, then the quality of the decision is likely to be impaired by political ignorance - the very problem that the rule of experts is supposed to stave off. Voters' choice of experts is just as likely to be compromised by rational ignorance and rational irrationality as any other electoral decision. By contrast, market participants generally have much stronger incentives to pick experts wisely.
Of course the experts could instead be chosen by nondemocratic means and insulated from political pressure. Yet, in the absence of democratic control, it will be difficult to ensure that the experts are actually serving the interests of the people as opposed to their own. By contrast, experts hired in a competitive market have better incentives; they know that if they pursue their own interests at the expense of the consumer's, they are likely to be out of a job.
Finally, both democratic and nondemocratic means of choosing government experts have a common weakness: both eliminate the option of dispensing with experts entirely. For some people, that may well be the best choice.
II. Should the Experts Get the Final Word?
The second major shortcoming of government-appointed experts relative to those hired in the market is the fact that government coercion deprives the consumer of the right to make the final decision. If I hire an expert in the market, I retain the right to reject his advice and pursuing a different course of action. This is a vitally important option. Although the expert is more knowledgeable than I am about technical issues in his field, I am more knowledgeable than he is about my own values. An expert on smoking knows more about the health risks involved than I do. But I am in a better position to determine whether the enjoyment I derive from smoking (if any) is enough to outweigh those risks. This insight is central to Hayek's classic critique of economic central planning, and it applies also to less extreme forms of expert control.
Libertarian paternalist policies that use expertise only to "nudge" or "frame" decisions for individuals are less vulnerable to the Hayekian criticism than are more aggressive exercises of expert authority. Yet even relatively modest assertions of expert-driven coercion carry the risk of preventing individuals from applying their own knowledge by increasing the cost of doing so. In any event, as Glen Whitman points out, the libertarian paternalist agenda goes well beyond reframing decisions. In many cases, it seeks to dictate them.
Ultimately, it is a question of whether we control the experts or they control us. Personally, I prefer the former.
Related Posts (on one page):
- Whitman on Libertarian Paternalism:
- Power to the Experts! - A Solution to the Problem of Political Ignorance?
- Political Ignorance and Libertarian Paternalism:
- Political Ignorance and Muslim perceptions of 9/11 and the War on Terror:
Alas! Unfortunately there is a problem with the market for information; the buyer of the information can only assess its value after he has already bought it, and sometimes not even that. Very few patients can assess whether their family doctor is any good, aside from the fact that doctor and patient having a shared interest in making sure the patient does not die.
While the problem posed is inherently impossible to solve, I think part of the answer lies in recognising that neither liberty nor economic efficiency is the whole grail of goals. Particularly the latter, whether construed as Pareto efficiency or Kaldor-Hicks efficiency, is far from perfect. Rather, efficiency is defined so as to keep economists (like myself) away from ethical judgements that are better left to philosophers. In other words, the economic definition of efficiency, as used by Hayek as well, is meant to allow economists to indicate the economic cost of policy choices that may very wel be defensible on other grounds. As for liberty, all I can do is refer the reader to Isiah Berlin.
Putting it this way, the examples given in the Glen Whitman post can be said to be neither economically efficient nor conducive to (negative) freedom, but they may nevertheless be a good idea. (Which is why many countries in fact have laws that incorporate the rules proposed.)
I don't think this is true. There are many ways to assess the value of information before getting it. First, one can assess the value of other similar information you already have or that others have acquired (e.g. - information about the value of a house or car). Second, one can assess the track record of the expert you are getting the information from. If his information tended to be valuable in the past, that's a pretty good predictor of the future. Third, it is often possible to know how valuable it would be to get the answer to a question or a solution to problem even before you actually have it. I know how much I value information about the cure to the tendonitis I currently suffer from, for example.
Personally, I already feel inundated by experts. There isn't a news segment or talk show that does not present some "expert" to enlighten the ignorant on the subject. It is only when I know something about the subject that I detect the flaws. Most often an agenda or even ignorance. Seems to become an expert one has to be media-savvy and possess a large ego. I'd prefer expertise.
Has anyone explored if people wouldn't fare as well or better if they'd have to acquire more common sense? Might go a long way to reduce political ignorance.
Second, one can assess the track record of the expert you are getting the information from.
Sure, that works for a deliberate decision such as an investment or a large purchase. But what about all those bits of information that make up political literacy? Most of us don't have the time to weed out bad expert opinion.
Reliance on track record means establishing reputation effects, which can be analysed in terms of repeated games, and trust, which is a sociological issue. Either way, just because someone has always provided advice/information that is valuable in the past, does not mean that any information you purchase from that source in the future will be equally valuable.
Secondly, information is not in and of itself a solution. The value of having a solution to a given problem should be compared to the cost of implementing the solution. (The disutility of having tendonitis compared with the cost of medicine.) Information has value of itself if and insofar it allows you to achieve a more favourable solution to your problem, and whether it will is impossible to say until you have purchased the information.
One example of where people in the private sphere delegate their authority to third parties is in resolving contract disputes. Aside from courts and arbitration quite often contracts contain clauses to delegate certain decisions to expert third parties such as surveyors, auditors, etc. Both parties agree to be bound by the decisions of these third party experts not just because they're experts but because they have no interest in the contract themselves.
For similar reasons corporations often have outside board members. Effectively the shareholders have declared that they're too closely affected by the short term behaviours to see clearly the longer-term big picture and search out respected persons who can make tough decisions dispassionately without the pressures the shareholders feel.
Similarly politicians are often too closely affected by the short-term political effects of their decisions. They often need to find someone whom all sides of a disagreement can agree will make a dispassionate analysis and decision and agree to be bound by it.
The example which immediately springs to mind is the base closing committee where politicians can by agreeing to delegate and to limit their options they can find compromises they would never be able to reach on their own.
So far from being without precedent in the private sphere these types of arrangements do have common and important analogues in corporate and civil life. And it's not true that they always fall prey to anti-democratic tendencies either.
First, if given power, they are likely to act in their own interests rather than in the interests of the unwashed who depend on their expertise. They are likely not to function as philosopher kings. To the extent that the interests of a mandarin class were in conflic t with those of other elements of society (or of society in general) the former are likely to prevail.
Second (and more important), significant decisions involve a step beyond expertise. They involve a choice of goals. I hearken back to Hume's point that an "ought" statement cannot be derived from an "is" statement. Bryan Caplan, for example, spoke of the inability of the electorate to make rational choices that maximize economic efficiency. But he thus assumed that this was the overriding goal.
Economic equality, social stability, a rich web of relationships, and ample leisure are desiderata whose achievment might require tradeoffs with economic efficiency. Expertise might be valuable in pointing out the existence of these tradeoffs, and their magnitude, but it cannot make those choices for individuals with moral autonomy, or for a society that is governed by the prinicple that individuals have moral autonomy. Such decisions must be made by some sort of consensus among citizens.
A great example of this are those who work in the area of child protection. Most states have laws that "reasonable" corporal punishment is acceptable. The experts with child protection agencies have often defined "reasonable" as "none"--thus imposing their own values in the name of "protecting the children."
(I want to make it perfectly clear that I am not advocating child abuse and that I think there is a need in our society to protect vulnerable children--this was but the easiest example I could think of where unelected experts are setting policy).
So you do admit that there is some level where corporal punishment becomes abuse and the interests of the state in protecting the child outweighs those of the parent in disciplining their children? Apparently, Ilya disagrees with you and if he thought it was rational to send his children to work digging coal twelve hours a day at the age of five, the government shouldn't have a thing to say about it.
Ilya, your rugged individualism of course ignores the tragedy of the commons. Not everything can be privately owned. Even if you turned every single square inch of real estate in the country over to private hands, you simply can't privatize the air and the water. Some entity has to regulate that for the common good in ways that will often conflict with what the market would deem would be the most efficient way to manage it.
The answer to this isn't to try to figure out who's the smartest and install them in power, but to have a constantly churning "marketplace of ideas" where the best ideas naturally outcompete the less effective ideas, and advertises their success, while those who pumulgrate the less effective ideas are not punished so severly that they cannot attempt to come up new ideas to add to the market place later on.
Societies with democracy, freedom of speech and free markets have this sort of system (more or less) in place, and you'll note that they are the most successful societies in the world. Trying to "overcome the natural flaws in the system" isn't a step forward, it's a step backwards. At least until we have a sort of expert that is inherently superior to humanity, all "experts" are in danger of falling prey to the same flaws that all of humanity has.
Sure, you may not want to support a system where Aristotle's opinion is given the same weight as the village idiot's, but chances are, Aristotle has persuaded many people to listen to him, where as the village idiot is, well, an idiot (which is another point from that book), so few will vote his way. But rather than institutionalizing Aristotle's brilliance, we force him to think and make his point with every election, and should the village idiot stumble upon a good idea, he has the chance to be heard.
I feel that this is a good compromise between the strengths and frailties of people.
I don't see why finding experts is such a problem for you - after all we do it for both law and medicine. The government can establish or recognize an entity that monitors quality and makes sure those receiving degrees are in fact experts in whatever the necessary field is. Experts don't necessarily have to be smarter, just more knowledgeable. But those receiving graduate degrees will probably not be stupid, as they do have to get a thesis approved and then actually write it. We have "experts" in the bureaucracy - except they are political appointees, and need not be qualified. Michael Brown anyone? The idea that the consumer should make choices assumes that the consumer is in fact rational and can choose what is best for himself. But that's the problem here: he's not.
In fact, there may be no experts at all, or, no one can reliably sort out real experts from charlatans, which amounts to the same thing. Given the difficulty of finding trustyworth experts, I still believe the democratic principle is more likely to result in good decision making for the society.
Basically the idea is simple; since the acquisition of information is too costly a process for the average person, today, to make direct democracy a rational, "viable" process -- if it were possible to radically lower the threshold for information acquisition, then maybe, just maybe, the perceived need for individual "experts" would go the way of the Dodo. :)
"Anyone can make mistakes, but to really foul things up, you need an expert"
(If not, I claim it!)
"I. Who Gets to Choose the Experts?" Wouldn't the obvious response be an appeal to Schumpeter, and to Veblen's arguments in "The Folklore of Capitalism"?
"II. Should the Experts Get the Final Word?"
According to Dorf and others, who have addressed this issue quite well outside the liberterian sphere, no. "Paternalism," in their mind, should be about optimal defaults, not optimal requirements. But for others, the answer is yes, because, duh, otherwise the experts would just be like they are today - with the power to persuade, but hardly the power to determine. The concept of an "advisor," either one for legislators, or for the general public (see the Surgeon General) is hardly unique.
Everyone is imperfect.
No one is objective.
and work from there.
My favorite definition of an "expert":
'A guy who knows 200 different ways to enjoy sex but doesn't have a girlfriend.'
What I find especially interesting is the libertarian tendency to argue in a very general and abstract level, rather than address specifics. I still have not heard a real argument from Somin against 401k opt-in or a host of other specific preference reflecting proposals. This is probably because his arguments become much weaker when it comes to specific cases.
Notice that when one argues at an abstract level, it is much easier to construct false dichotomies and fail to address issues in a nuanced way.
That is because libertarian arguments lack nuance and thus are not convincing. You can continue to argue abstractions all day -- you aren't going to slay concrete beasts.
There must always be a way to judge an expert, or they are not an expert. Scientific or practical fields have goals, even if very general. An engineer can build things, a doctor can heal patients, a lawyer can work the legal system, a scientist predicts phenomena (at least more than an amateur). There is no way to gain expertise about something if you have no way of judging your performance and so judging how to improve it.
I agree with you and Guest101 that it is foolish to frame this discussion as a choice between the police state and primal anarchy. Speaking from a more libertarian perspective, I agree completely that that choice is no choice at all.
I think, however, that you oversimplify libertarian concerrns. Put simply, libertarians tend to focus on the harm that government can do, liberals on the good that it can do. Neither is particularly "wrong." Also, I think most libertarians look at the history of the 20th century and see plenty of examples of hypertrophied states abusing their power. This has occurred even in some of the most "civilized" of countries, like Germany. On the other side, we see very few examples of functioning, modern governments evolving into unfettered free-market Darwinism.
Surely you must agree that recent history teaches us to worry about the State more than we worry about the lack of one, no?
Another example of "libertarian" thinking-- what happens when large numbers of people refuse the advice of the experts? Do they just shrug their shoulders? Or do they decide that this omlet requires a few broken eggs? I mean, in theory at least, the communist regimes of the 20th century were not supposed to be as bloody as they became. It just was that the mass of "proles" rejected their prescriptions for the future (like collectivization). The experts became very angry, and very vindictive, and decided that a "new man" needed to be created. Unfortunately, that required the deaths of many of the "old" men that refused to change.
Perhaps these are overly "abstract" examples to you, but they seem like sensible concerns to me.
I can't think of anything more anti-democratic than your example. You argue that because you are unqualified, or unwilling to become qualified (or unable to become qualified), to make informed decisions, that no one should be free to make their own decisions (on subject matter specifed by you).
That's a dangerous combination of arrogance and laziness. Can't you just get a subscription to Consumer Reports and leave the rest of us alone?
I think you're just beating a straw-man here.
You define your opponents claim as the belief that "experts know better than the average person - and therefore they should make the decisions." However, this is an ambiguous statement. It can be plausibly read as referring to average persons acting in their capacity as either voters or market participants.
You seem to think it's the latter and direct your energies to rebutting that interpretation. I agree with you there, but I think you miss the point. Rule by experts was offered as a solution to the problem of voter ignorance, not consumer ignorance.
You keep referring to a "tension" between the idea that government should be ruled by experts and the idea of limited government, but I just don't see it. Instead, I would propose a simple. two-step decision-making process:
1. We first have to determine whether a given issue X must be addressed by the government, or whether it can be left to private individuals in the market. I agree with you here that issues should be left to the market whenever possible. However, if we determine that the issue requires government then there is a second decision to be made.
2. We then have to determine whether government policy on issue X should be decided by experts on X, or whether it should be decided by voters or their representatives. I would prefer to leave it to experts.
What is inconsistent or contradictory about this position? It seems to me that rule by experts is not an alternative to the private market. Rather, both are alternatives to the democratic political process and its systematically irrational results.
Serious irony alert on your post there.
I wouldn't say that these contrasting perspectives are wrong. I would question whether they are "useful" however. Both are false. Government has the potential to harm and the potential to do good. The question is thinking about these potentials with respect to specific and concrete problems. Excessive abstraction where critical features of this messy thing called reality are ignored is not convincing. Often, whether one is liberals or libertarian determines what one inclined towards the abstract focuses on and what one ignores. But neither is really engaging with reality. Abstraction is useful in many contexts, but it is also subject to diminishing marginal returns in many contexts as well.
This depends on what your definition of a state is and how the thing you call a state is structured. The United States and the former Soviet Union both might be called states. But they were very different beasts. In many African countries, the actions and inactions of dysfunctional and weak states contribute to massive problems.
Of course, there are many examples you could use to reinforce your hypothesis. One does not have to look far to find an abuses of power by state entities. But, likewise, one does not have to look that far to find serious abuses by non-state entities. In general, I think that any perspective that reifies the various and heterogeneous social institutions that we label the "state" and suggests that these heterogeneously situated social institutions are the source of all problems or solutions are very limited in usefulness.
This depends on the context. If the advice of experts that is ignored is to not to drive with a blood alcohol level above a certain limit, perhaps these large numbers of people will be subject to relatively minor criminal sanctions if and when their behavior is detected. In the case of a "nudge" (such as an opt-in provision for 401k) perhaps people who disagree will be able to make their own decision.
Do they just shrug their shoulders? Or do they decide that this omlet requires a few broken eggs?
This is, one again, a false dichotomy. In the case of a nudge, you might let those large numbers of people do whatever the judge is best. In the cast of driving under the influence, you might subject them to minor criminal sanctions and perhaps give them some jail time if they persist in violating the law. But you do not kill them (or euphemistically "break some eggs.")
I think the above illustrates how easy it is to fall into false dichotomies when speaking on a very abstract level. Earlier in your post, you agreed that false dichotomies were of limited usefullness. But here, you seem to fall into one.
A perfect example of the limitations of theory.
I agree that your concerns are sensible. However, my view is that discussion of how to address these sensible concerns (and the sensible concerns of others) is most usefully addressed with a lower level of abstraction.
That model would seem to answer your particular concerns in this post, but I understand advocates of limited government to dislike the regulatory state.
I'm sure I've missed something basic, but I'm not sure what it is.
Ilya,
Herein lies the fallacy to the question you pose. It is the job of elected officials to not only perform the tasks they have been elected to complete, but to communicate with the people who have elected them to do so. If there is a block to communication caused by what you are calling "political ignorance" then it is the responsibility of elected officials to break through that block by presenting information in a manner sufficient for the electorate to comprehend. Or else, they may not (and should not) be re-elected because they have not done the full job.
One of the rationales for having public schools was to provide the means for all citizens to understand the tenets that the government of this country is based on in order that they may participate, yes? What you call "political ignorance" is really a failing of the schools, is it not? Then shouldn't the focus of responsible elected officials be to remedy this failing?
Your response illustrates the fundamental failure to grasp the concept of a collective interest that is ufortunately common to the libertarian perspective. In my example above, I am not making a decision to delegate responsibility for promulgating food safety guidelines to an expert agency-- we, the public, are choosing to do so, and are choosing to cede a degree of our individual autonomy to our expert employees for the sake of our own individual and collective benefit. That kind of voluntary mutual acquiescence to a central authority for the benefit of all is not anti-democratic, it is the very essence of democracy.
Whether you care to admit it or not, neither I, nor you, nor any other individual, is capable of developing sufficient expertise in all areas to make rationally informed decisions about every aspect of our lives without the advice and guidance of experts. There's nothing lazy or arrogant about acknowledging that fact and delegating authority to a bureaucratic agency that has institutional expertise in a specific area for the purpose of implementing our-- i.e., the public's-- general policy preferences by means of specific technical regulations. For example, we generally want to drive cars that are reasonably safe and fuel-efficient, yet not too expensive. However, the public lacks sufficient expertise in the technical aspects of automotive engineering to know how to best pursue those high-level preferences, so it delegates the matter to an expert agency (in this case probably more than one) to work out the details. This is the common model of state and federal administrative law-- the legislature, as representative of the people, enacts a generally vague expression of the high-level policies it wants to implement, and delegates the details to an executive agency with expertise in the relevant area. So long as the legislature retains ultimate authority over the expert agencies' implementation of legislative fiat, there's no resulting infringement on any individual's liberty that can't be justified by social contract theory.
Without the FDA controlling food, every newspaper would have a column on good and bad foods and there would be plenty of magazines devoted to it. People would be able to be extra careful or to take some risks.
Some might make bad choices but today the FDA doesn't always make the right choices. Better to make our own choices than to have a tyranny impose it.
Or, rather, a majority of the public, or however these experts are chosen, are doing so. Since the majority-chosen experts will be forcing their will on the entire society, doesn't it make sense to err on the side of too few expert-made decisions, instead of too many?
In the meantime, keep slaying those vampires.
True, but on the other hand a good many "ought" statements should have been invalidated by "isn't" statements. As in, that isn't possible. When the political process goes seriously awry, often it is pursuing an apparently desirable but actually impossible goal by dubious means.
E.g., equality seems like a good goal, but what do you mean by equality? Equality before the law is perhaps achievable - if that's your only goal - but in the pursuit of other forms of equality we've often elevated officials above the laws applying to the rest of us. Social equality just isn't going to happen - like every other animal, humans naturally create a social "pecking order", and even with the dictatorial powers some school systems claim over their students, all they can do is to put someone else on the bottom of the heap for the day. But the most damage has been done by attempts to impose economic equality. Taking from the rich and giving to the poor inevitably gives tremendous power to those in charge of taking and giving, thereby creating more inequality. It also makes nearly everyone poorer, as it reduces the incentives to work hard and create products that others want to buy. Less damaging and less coercive is to attempt to raise the low end with education and training, but it's often unsuccessful because many of the low earners aren't bright enough to benefit from it, and others just won't conform to the reasonable expectations of employers (showing up on time, following instructions, not punching the foreman or stealing from other workers, etc.) And often job training programs have failed because they moved at the speed of government, so the jobs they trained workers for are long gone by the time the first trainee graduates...
Maybe that does make sense; this echoes Henri Le Compte's comment above, and is a good point, to which I would like to write a longer reply but don't have the time at the moment. As I said in my second post in this thread, obviously there's a balance to be struck between individual liberty and collective interests and we shouldn't assume that all bureaucratic regulation in the name of "the common good" is in fact a good or desirable thing. But that's just a debate about the degree to which we want to delegate authority to expert agencies, an important question but tangential to my primary argument here, which is with the libertarians who seem to view any kind of liberty-restricting market regulation as illegitimate "tyranny."
(Sane) libertarians are fine with that - if they get to pick the experts and the areas that are turned over to the expert. I'll hire a doctor, an investment analyst, or an auto mechanic when I need more knowledge or skill in a particular area than I have or can easily acquire for myself. However, most people would get pretty upset if the government said you couldn't fix your own car, and you could only take it to the auto mechanic that the town council hired for the town...
"Rule by the best" in America?
What you call "political ignorance" is really a failing of the schools, is it not?
It isn't necessarily a matter of ignorance as in lack of education, but can be also thought of as ignorance born out of apathy. If ignorance is more heavily weighted to the latter, then there is little the educational system can do about that.
Also, the more centralized (and remote) the political system is, the less any individual will feel able to impact it. In that case, what incentive does the individual have to be a better informed voter/citizen?
From my libertarian perspective, I am more tolerant of intrusive govt at the state level then at the federal level. This is not from any theoretical basis, but, 1) it flows from the original construct of our federal system and 2) knowing there are 50 different varieties, at least a few are bound to be considerably less intrusive than the average.
So long as the legislature retains ultimate authority over the expert agencies' implementation of legislative fiat, there's no resulting infringement on any individual's liberty that can't be justified by social contract theory.
Egads man, I hope you don't mean that literally and without regard for the Bill of Rights.
I had our actual administrative law system, including all of the constitutional limitations on legislative action presently in place, in mind when I made that statement, though on reflection, I think it's an open question whether a republican system that lacked the constitutional protections enshrined in our Bill of Rights would be indefensible under social contract theory. It's an interesting academic question (my initial reaction is to think that while constitutional protection of essential civil liberties is a very good thing, it isn't necessarily a sine qua non of a legitimately democratic system), but for purposes of the present discussion I'm happy to limit my comments to the context of the American legal system as it currently exists, constitutional limitations included.
Do you really think that would be sufficient? Look what happened with pet food over the last couple months even with the current regulatory standards.
On a related note, why is your links to Plato's Gorgias when his alleged totalitarian work is the Republic?
That's a cause-and-effect question; is education hampered by apathy or is apathy a result of poor educational processes? I tend to think it is rather the latter. Children don't come to schools with apathy in hand.
Do you really think that would be sufficient? Look what happened with pet food over the last couple months even with the current regulatory standards.
You proved his case. The FDA, being a federal bureaucracy was incompetent to adequately screen enough Chinese shipments. A free market of competing testers would have been more efficient and have discovered defective Chinese products sooner.
And yes, actually, I am mostly serious. I think the X-Prize concept is one of the best progenerative social behavior modification 'innovations' around. But until Ilya's blogentry I hadn't thought of expanding it to fact-checking, or generating new value mass-market dissemnatory assessments of expertise both wide and narrow, or other comparatively abstract areas. . .or. . .hrmmm. . . .
Maybe I'll just trundle this idea on over to Bill Whittle's new Ejectia! concept community, too.
"But the problem is exactly this - people are not rational. The decisions they make either fail to take into account their values (how many smokers deceive themselves, despite overwhelming scientific evidence, that they are special and will not die?)"
I would venture to say none--we know we are going to die. What we don't know is whether smoking will kill us, or a drunk driver (my 29 year old smoking brother), or Alzheimer's/general old age (my 98 year old smoking grandmother), or pancreatic cancer (my 78 year old smoking father), or a bullet/IED, or something else.
And, meaning no disrespect, you don't know, either.
To the topic, libertarian paternalism seems to be an oxymoron to me despite the efforts of Sunstein and Thaler, as the one is focused on individual liberty and free choice (self ownership), while the other is emphasizes that the state can “help you make the choices you would make for yourself—if only you had the strength of will and the sharpness of mind.
It's easy to "prove" things if you're willing to overlook a question-begging non sequitur like that one. Obviously no agency-- public or private-- is going to be able to implement its mandate with 100% efficiency; things are always going to slip through the cracks from time to time. The fact that these products initially slipped through the FDA's screen says nothing at all about whether a purely private system would be more effective.
Many will still bristle at this, but I think they ought to do so only while recognizing that Plato was highly skeptical about whether anyone could possibly be like this, and even if there were they couldn't ever be shown to be such an expert, because the masses who aren't experts of that sort won't be able to recognize that the expert's views are correct (because they're not themselves experts). Therefore, most people wouldn't be able to tell the expert from the corrupt imposter, and therefore to guard against that eventuality it's best to have the inferior form of rule, which is rule by many who are not experts.
As I said, many will still disagree with him about what the ideal state would be like, but they ought to do so not in terms of his faux view put forward in the Republic, which is really just a model that serves as an analogy for what he thinks the just person will be like. They ought to take his mature presentation of political discussion in his later dialogues (e.g. The Statesman), which are unambiguously about politics as its own subject.
Turn on your nightly news.