Freedom Transcript: Peter Van Doren on How to Think About Policy Questions
Today we have the second episode of the Freedom podcast, bringing back our good friend and fan favorite Free Thoughts guest Peter Van Dorn for a discussion of how he thinks about public policy. Here's your supporter-exclusive transcript. And be sure to check your supporter podcast feed, too, as we have 15 minutes of bonus content from our conversation with Peter.
Peter Van Doren: Being a politician means being four things because of value fights, even if it's not realistic because you lose reelection if you are realistic because people like me, if you run, I say, "Well, we're going to maximize utility given the budget constraint." Wow, that really whips the voters up, doesn't it?
Trevor Burrus: I'm Trevor Burrus.
Aaron Ross Powell: I'm Aaron Ross Powell. This is Freedom, a show about ideas that matter. Freedom is an independent, listener-supported show. If you value these conversations, please consider becoming a supporter. You'll get access to episode transcripts, bonus content, and our Discord community. Learn more at freedom.audio/join, or look for the link in the show notes.
Trevor: On today's show, we bring back our favorite guest from Free Thoughts, our friend Peter Van Doren. Peter came on Free Thoughts over 20 times and we gave him his own music as we've done again. Peter is a senior fellow at the Cato Institute and editor of Regulation Magazine. Today, we're going to take a step back and try to learn how Peter thinks about the world and how he came to those views. Well, Peter Van Doren.
Our most popular guest on the Free Thoughts Podcast and we've brought you back. This time, we want to do something a little bit different. We want to talk about how you think about things. In the discussion beforehand, you were like, "I don't really know how to talk about that, but you do," and so we'll get into that. I wanted to start with a question you just brought it up before we start our recording. Your background in terms of your academic and what you're specialized in, and how your interdisciplinary background has helped you think about questions in different ways.
Peter: Believe it or not, it starts as an undergraduate when I couldn't decide what to major in. I went to MIT and I grew up on a farm in northern New York state. Never been south of Syracuse in my life and my parents didn't have time to take-- Anyway, they stuck me on a plane in Syracuse and I flew to Boston in September of 1973. I just started taking classes. All schools, you have to decide what to major at the end of your sophomore year, and I said, "Geez, I like biology and I like chemistry."
I thought I wanted to be a biochemist. I majored in chemistry because it only had eight classes required. Second-semester, junior year, MIT also-- the labs were separate from courses. Organic chemistry and inorganic chemistry didn't have labs with them. The labs were separate. Junior year, second semester, organic lab was half my course load. It was five hours a day, five days a week. We were learning to be chemists. Oh boy, I said, "Wow, I love learning about chemistry but doing it seems boring."
Fall of semester senior year, I went in to my advisor to have him sign my course cards. I had all economics and political science classes and no chemistry because I had one chemistry requirement left, which was I would do a spring semester senior year. He wouldn't sign my card. He said, "We only have eight courses in the major because we want you to work in a lab and then you're going to go to graduate school in chemistry."
I said, "Oh, man, I don't know if I-- I need to figure out what I'm going to do here." I've taken some political science and economics classes and no one does that at NYT and really likes them. They're thought of as being in the penalty box. I actually got to know people in the Department of Political Science and Economics. I went to the undergraduate head of advisors there and I told him my problem.
I said, "I need my course card signed." Believe it or not, they cooked me up a do-it-yourself major in one year. I did not get graduated with a chemistry degree even though all my classes were chemistry and I didn't ever take inorganic. Basically, which is I like science, I like engineering, I learned a lot in economics and political science. In the policy world, that's pretty unique. I think we need more engineers and scientists that come into policy. Sadly, well, I guess, but we could make you guy-- we need fewer lawyers in policy and there is--
Aaron: Hey.
Trevor: Aaron probably agrees since he's pseudo-technically a lawyer, but never did it. Sorry, continue.
Peter: I think that, and I'm now almost 70 years old, and yet I'm still trying to figure out what I want to know. I just find lots of subjects interesting. I think in the policy world, you need, I think a technical background, as well as a social science background, is very useful. The technical background sadly is often quite lacking among many of what we call the chattering classes that we now are, that people talk about policy as if they knew what was going on about--
For example, electric vehicles or electrification of the society. I read things in the last few years and I go, "What? That's just--" There is a guy out there, you may have heard of him, Vaclav Smil, he writes books. I think he's a physicist by training and he reminds me-- I'm not up to his level but he writes books about policy in which he says, "Some of what government wants to do violates the laws of physics and thermodynamics and other things, and thus we're not going to do that. Although I don't know what we are going to do, we're going to end up in some other space."
I wrote a blog post recently summarizing all of this and I call it Policy Beyond Capability. It goes back to some of the things that environmental policy in the '70s, which we said, "We're going to have clean water by 1985. We're going to have clean air by 1975. We're going to ban the internal combustion engine in California by 1975." Those are all real things that policymakers said could happen. I have a quote from one of my mentors, Alan Altshuler, who's at the Kennedy School now. He was at MIT when I was an undergrad. He said, "Environmental activists act as if the legislature stating something means it's really going to happen even if it can't or won't."
Again, sometimes my Cato colleagues get frustrated with this view I have, which is, being a politician means being four things because of value fights, even if it's not realistic because you lose reelection if you are realistic because people like me, if you run, I say, "Well, we're going to maximize utility given the budget constraint." Wow, that really whips the voters up, doesn't it? Anyway, I'm a policy analyst with a mixed interdisciplinary background, and I think that's important. Also, the fact that I was intellectually young and aware during the '70s when the environment and energy were where it was at, and so my formative intellectual experiences were about policy areas where everyone wished and wanted the moon, even though it wasn't going to happen, and thus made me mark or--
I'm not sure, market-oriented, that came later, but it made me realize that being active or being an activist and just voting for the right people was a maybe necessary but not sufficient condition to get the world to change. That informs me even to this day.
Aaron: You said something interesting when you were talking about the value of interdisciplinary, just knowledge and training that I wanted to tease out a bit. Because I too, I really value interdisciplinary abilities and conversations. Part of my job is arranging conversations among academics and I love to have those be interdisciplinary because it's surprising how much one discipline things that they think are just obvious that another discipline has never even heard of and having those cross-disciplinary conversations. You said, when you're doing policy, it's important to have a social science background, but it's also important to have the technical training. What I wanted to tease out was, there's a couple of ways we might think about interdisciplinary training. One is what it means to be interdisciplinary is to essentially have a wide body of knowledge about a lot of things. If you're a policy person and your training is in economics, but it can be really helpful to have a strong grasp of history as well to have a sense of like, oh, this thing was tried or a version of it, or this is what happened or what's happening now looks awfully familiar to what happened back then, and so on.
It's kind of interdisciplinary as just having a lot of buckets of knowledge. The other way that we could think about it is methodologically, that the way one does research in sociology looks different than the way one does research and economics looks different than the way one does research in philosophy. It's kind of separate from the content itself. It's more like I have a different toolkit for applying to a given question. Does one of those stand out more for you or does one of those like is emphasized in the story that you're telling?
Peter: When I tell my own story, I suppose I would emphasize the buckets of knowledge view. However, you've made me realize that also in my reading, I pick up exactly what you said, which is when I read sociology for example, I go what are they do? Or then when people read when I have others read economics articles, it's like, I don't know what they're up to write this silos of knowledge that are completely separate, the language, the verbiage, the starting assumptions. My research helper at Cato, David Kemp now and I are writing, we're trying to figure out-- the working this tentative title is "What can OPEC do? What does OPEC do? What should we do about OPEC?" We have had to, despite many people that I shall not name have been whispering my ear, you don't need to figure this out, I have thought we need to figure out the chemical engineering and geology of oil production.
There's a rule in economics, it's called the hoteling rule. It's allegedly an explanation of how-- it's the path of prices of non-renewable resources over time. This rule, this theory, says a non-renewable resource, you think of it as a container, like an aquarium, and you're figuring out how much to dig or how much to suck out at what rate. You will adjust that amount as interest rates vary because that's what interest rates and economics tell you to do. They tell you to speed up or slow down because interest rates change the present value of the amount you're going to get given the rate at which you are producing from this aquarium. Then we've dug into what chemical engineers and geologists say about oil production and they don't see anything about that.
They go, "The rock underground is not like an aquarium. You don't just stick a straw in there and stuff happens. Once you stick a straw in there, you've got to be very careful about what you do because you can change the cumulative output of this reservoir." This OPEC notion of varying output up and varying it down to do stuff, which is the way people understand OPEC in the press, the more we dug into the geology, what geologists think. We actually talked to a Cato donor who was an oil geologist, and then we read a lot in oil geology and read papers from Texas A&M until we realized it wasn't just a cow college it was an oil college. Anyway, just like "Oh, okay the chattering class's perception of OPEC turning a spigot on and off the underlying technical basis of oil production wasn't like that."
I've been studying oil markets for my dissertation 40 years now. Even I didn't know enough about the technical constraints. I guess this is a long-winded answer to Aaron's question about which, so knowing buckets of knowledge. Also knowing the methodology of what oil geologists do and don't do and how they figure things out has been important to our-- and we're still figuring out how to write this paper right to get it right. One thing we realized though is the hoteling notion in economics, all economics articles about oil production say they start with hoteling and we're going until recently there's actually been some new stuff.
The interesting thing about the new stuff a guy tenured at the Harris School in Chicago is he had an undergraduate before his economics Ph.D. and an undergraduate degree in chemical engineering. He's the only oil economist I know who has that. He worked for British Petroleum. He literally brought what he learned and then said, wow economics isn't getting oil right. The reason was because they were focused on the hoteling theory as opposed to anything that geology or chemical engineering had to say about oil.
Trevor: To Aaron's question to continue off of that in terms of the methodological things, and you mentioned in your first answer that you looked at your transcript and you had tons of economics and PoliSci classes in there. Was there something about the methodology of economics in PoliSci that attracted you? The one that I'm thinking of is something like methodological individualism where-- I read historian papers or sociology papers and they don't have a methodology to approach the question of why things happen. Is there something kind of philosophically down there?
Peter: Sad. What's interesting is a lot of my intellectual well, learning more about methodological individualism and then its association with liberty actually came after I came Cato. It was not [crosstalk]--
Trevor: You were probably thinking that way. Maybe you didn't have a name for it but you [crosstalk]--
Peter: I didn't have a name, like Cato has a name, right? We're a little intellectual enclave. Remember, I would never pass the test to be a Cato intern even now because I wouldn't say or do the right things. I wouldn't talk about Anne Rand, I wouldn't use the word methodological individualism. I wouldn't use liberty, but in Liberty land, you learn those code words early on and you realize they are crucial to your future and you need to utter them, otherwise you don't get hired. I didn't know that. We've talked, me being at Cato is a big effing accident because I wasn't interviewed. If I had been, I might have failed all the tests and that's interesting.
Trevor: On that to follow up with that within the Cato context did you kind of learn what libertarianism is on the job and [crosstalk] the second question is--
Peter: No. I just [crosstalk]--
Trevor: What do you think libertarianism is now? I don't mean that in terms of political movements. When you with all the colleagues at Cato and everyone says these are my philosophical commitments. These are the biggest--
Peter: Here's what I brought. What I learned early on from economics was not necessarily was to separate efficiency from distributional issues. That's just and even at Cato, people don't, I just--
Trevor: Expand. You're going to have to explain that a little bit more.
Peter: Okay. Efficiency is about what economists call getting prices, right? Price should equal marginal cost. All of those things from Econ 101, turns out in regulation, right? Remember I started studying environmental and energy regulation. The question is what is it about energy and environmental markets that does or doesn't work using that word in parentheses? Turns out, work, to an economist, is in two parts. One is, is there an efficiency claim going on in that involves something called market failure. That the efficiency characteristics of markets optimally utilizing resources and maximizing output relative to inputs.
That's what economists mean by efficiency. Everything else, most of politics, maybe all of politics, maybe all of cultural fussing, isn't about efficiency at all. Thus economics actually has nothing to say. It's about the distribution of income and wealth. I wish the money that other people had were taken from them and given to others because I think that would be the right thing to do. Now, economists can talk about, "This tax is more efficient than that, this way of redistribution has more or less efficiency consequences," but the ultimate question of, is the distribution of income and wealth, is it something that-- something called the state or anybody ought to have the right to do something about is completely outside of economics? It's a philosophical question.
When someone says something is a policy problem, I always ask them first to talk out loud so I can figure out, when they say something is a problem, whether they are saying there's a distributional issue out there in the public or in their own minds that they would like majority rule to change, or are they really saying price doesn't equal marginal cost and we could get it, we could regulate that market or we could tax it or subsidize it to get prices closer to marginal cost? I can give an example, a current one, if you want to drift on. Electricity pricing in California. It's like "Oh boy, Aaron's going, 'Yes, I really want to talk about this,'" but it's made the papers in an interesting way because of economists at Berkeley.
First, most people don't realize that most of the costs for producing electricity are fixed. It's the wires. It's not generation. It's not the use of fuel to produce electricity. It's all the fixed costs. When fixed costs are high and marginal costs are low, how should we price the product? The answer, if you read Regulation carefully, my journal, three-part tariff. A price for use which is based on the cost of generation, a big fixed charge per month to cover all the things that are just there that don't vary with use, and then three, a peak demand charge, which is the highest use every year by everybody at the same time determines a lot of the fixed costs. All right. [crosstalk]--
Trevor: Wait, wait. I just want to translate for our [unintelligible 00:22:38]. The fixed cost is at the biggest thing at the beginning is laying out the lines, laying down, creating the power plant.
Peter: Correct.
Trevor: That's, let's say, $5 billion of the cost of this, and then the actual burning of whether it's nuclear or anything to generate the power, that's the variable cost, and that is not as much a component of the price of electricity as the wires, and then maintaining the wires. I know from an old Free Thoughts episode, actually cutting down trees around electrical wires is a fairly large--
Peter: Well, the Northeast Blackout was because they didn't keep the transmission path free of trees.
Trevor: Then when consumption spikes happen, you want to price that accordingly and make people vary their consumption. People think that the biggest component of electricity cost is the generation of the electricity, but it's not.
Peter: This comes up in California because prices are 25 to 35 cents a kilowatt hour, but the system marginal cost, including carbon pricing and pollution, estimates by Berkeley of what the pollution tax ought to be, are something around 7 cents a kilowatt hour. Think, right? You should pay, instead of $10 a month fix, the California proposal is to charge $80 a month, and this is pissing off the rooftop solar people. The rooftop solar is attractive in California because of what's called net metering. Think of it. If you produce enough on your house to satisfy all your use in a month, your electric charge under the old rules in California was $0. You were paying nothing to fix cost. Instead of paying $80 a month, the approximate probable cost, you were paying $0.
Given 35 cent/kilowatt hour charge to the big users inland California, where the San Francisco winds don't blow when it really gets hot inland, those affluent California solar installers were paying $0 a month, and then the fixed costs of the system were being shoved onto other folks, right? The California Energy Lab at Berkeley, the Severin Borenstein and his folks, proposed to raise fixed costs and lower marginal cost. Well, then they said, "What about low-income people?" Then they came up with an income-related fixed monthly charge. Well, everyone's gotten wind of this and there's hell to pay. The Post is picked, the national paper, The Post and The Times are starting to-- Conservative columnists are saying, "This is totally inappropriate." In fact, there's a Cato blog the other day by someone saying, "This is outrageous. We can't have income--"
Well, you could. There's nothing-- You got fixed costs, all right? Everyone can pay $80 or $90 a month, or the low-income folks can pay $25 and the high-income folks can pay $130. Okay. I don't know if libertarians have a-- if we ought to have a position on whether that is bad or not, but there's a lot of fixed costs. You got to charge it somehow. For economic efficiency, you need to get that price equal to what the system marginal cost is so that everyone then has the right incentive to use or not use, or conserve or not conserve. You get these idiotic arguments from conservationists saying, "Well, the 35 cent/kilowatt hour charge now really has great incentives to conserve." True, but it's actually an inappropriate incentive to conserve if a reasonable carbon tax and a pollution charge plus the marginal cost of production are somewhere like 7 or 8 cents.
You don't just charge people for the fun of it, at least in my world. Anyway, that's a complicated current example of how distributional and efficiency issues aren't well-understood and aren't separated. All the chattering classes are getting it wrong and the Berkeley people are getting pummeled for-- I told Jeff Myer, our colleague at Cato, I said, "Look, the economists never had the influence." Look, Severin's Energy Center at Berkeley got the legislature and the California Regulatory Commission to actually change the way they price electricity based on his papers, and he just catching hell for it. No good turn, or whatever the right phrase is. Anyway, that's an example of Peter's mind thinking out loud. The listeners are now saying, "Oh my God, that's so sad."
Aaron: One way of stating, I think, the takeaway from much of what you just said is that politics is not about policy-
Peter: No.
Aaron: -or not largely not about policy.
Peter: Not about efficiency.
Aaron: All of us either do or have worked in the policy arena. I am the one who has the most just gotten the hell out of public policy. Part of that was a recognition, and this got a lot worse in DC in the Trump years, that policy just didn't really matter anymore. People, the decision-makers, simply weren't interested in it. The voters had never really been interested in it. Nobody cared. You're making ammunition to reinforce decision-makers priors. They just come to you and say, "I already believe this. I want you to tell me I'm right." or, "I want you to give me things that say my opponents are wrong."
Peter: Correct. They would listen to you when you did this, even if you used jargon they didn't understand. They did not actually care about the problem intellectually. There are exceptions, but on average, getting price equal marginal cost is not how you win elections, probably, unless you're in a special kind of district with nerdy voters, et cetera, et cetera.
Aaron: I think this manifests in-- Say, this is distributional issues, and distribution matters to people in the sense that people are motivated by like, "I want more stuff," or, "I want the people I don't like to have less of."
Peter: Correct. Correct. Yes.
Aaron: That's not the whole of the non-policy concerns. There are more value-based, "I want the state to represent the values that I like and not the values of the people I don't like or enforce those values.
Peter: Certainly we're seeing that recently, and that's to a person of my background in training, it's a head scratcher because nothing in my training or being or intellect allows me to offer anything to help adjudicate those kinds of conflicts. Other than that, it turns by necessity because if you have value fights, then politics has to be zero sum and it's a fight to the death.
It's medieval in nature and we used to kill people over these things and now thank goodness we don't do that but my goodness are people riled up over, "I want to live my life my way and I don't want to have to collectively consume other people's vision of the good life and I want textbooks. I want the public sphere to reflect my way of thinking about these zero sum things rather than anyone else's because I hate them or don't like them or think to be fair to these folks."
I disagree with their values and think it's wrong for those values to be in the public sphere. Wow, nothing in my tr-- My intellectual training is that elected officials know all this in their bones and hate these kinds of issues. I was taught intellectually at least that they politicians do not want to be this way and know they can't win elections this way continuously. I literally, am puzzled and I don't have a good positive theory of why so many folks are trying this now to win elections because it seems to me, well, I'm just repeating everything in intellectually in political science in the '70s and '80s was, no, you don't, that's not how you win reelection because for every voter you might gain, there's somebody you lose and you want to cut ribbons, you want to build dams, right? That was pork beer.
You want stuff that even though it's idiotic from an economic point of view, you want stuff to give out that makes everyone happy. Happiness is getting someone else to pay for your stuff. That's what Congress used to be about. I'm old fashioned in that I think Biden is a throwback, but intellectually I get it. Which is, he may not stand for anything, but that's really good. Thank goodness he doesn't, because he's going to lower the temperature in the room and meanwhile he's going to borrow like crazy and give away the store, but we're not going to kill each other.
Aaron: Yes, to give a hypothesis, I guess to what's happened, I think it's a combination of two things and unfortunately, they are fairly intractable things. The first is the nationalization of politics that most engaged voters now get their news from national sources versus local sources. That bridge that got built in your district is not as big of news to them as the drag queen story hour 2,000 miles away, that their national talking heads are yammering on and on about and the growing power of the presidency makes that worse. Cable news makes that worse. The internet is a public sphere makes that worse because your attention is all national. If you want to stir people up, it has to be, what? Sometimes gets referred to in media is, we need a national conversation about this and I think part of this argument is, no, we need far fewer-
Peter: Exactly.
Aaron: -conversations and more local ones.
Peter: The more national conversations we have, the more we'll realize we're really different.
Aaron: No, why don't we have international conversation? Keep going out. Part two, I think just briefly is the increasing gerrymandering of districts means that the election that matters is not the election between the Democrat and the Republican. It is the primaries. It's who's going to get the Republican nomination or who's going to get the Democratic nomination because once that happens, it's a foregone conclusion and primaries tend to attract the most engaged and the most extreme voters and so, their influence is wildly outsized compared, and both of those seem like it is hard to get everybody back to looking at just local news and not caring about the national scene. It's awfully hard to un-gerrymandered because nobody has an incentive to deescalate in that.
Peter: I'll push back only a little in the intern lecture I give, I'm always looking for new papers and I found some interesting ones for the spring lecture in which-- I'm a median voter guy. The extremes are-- Again, the extremes will be--
Trevor: Clarify. Just the median voter theory is that the person right in the middle who could go either way is the one who decides the election essentially correct.
Peter: In my lecture it's Susan Collins or Joe Manchin or Kyrsten Sinema, right? It's neither the Freedom Caucus nor Bernie Sanders, and so the AOC crowd and the Freedom Caucus, they yell and scream a lot, but they're not going to matter. I've students push me, because of McCarthy's speakership and this and that. There's a good Stanford paper that shows that in the 2022 midterms, the election denialists on the Republican side did worse than Republicans who didn't deny, right?
In the primaries, you're correct but once you go to the general election, then they go, "Oh my goodness, this is crazy." Same thing on the progressive side, right? The AOCs of the world haven't done that. Outside of the districts, one would suspect representing the South Bronx is different. Again, this part, I guess we're not going to cite papers and all that, and I didn't really prepare on that front, but they're-- Then on an abortion, what was fascinating to me is when the voters seem to get a chance in referenda, even in very, very red states, they have pushed back.
My colleague Jerry Rosenberg, his dissertation, and he wrote way back when that said that the Supreme Court getting ahead of the public is the worst thing that can happen for the court. You actually want the legislature to wrestle with stuff. Even though progressives were frightened to death of legislatures wrestling with abortion, they thought it would be a nightmare. It hasn't been in the way they thought. I pushed back just a bit on.
Trevor: All right, so I have a related question. It's not totally related to Aaron's question, but there's going to be a word in this that you hate, Peter, but I want you to try and wrestle with it and you can resist. That's fine. Why, and this is a word you'll hate, philosophically, do you believe in free markets? Did you come to believe in free markets? You mentioned that you worked into market theory early on in your career, but why? Again, if you could say something that's philosophical about that, do you believe in free markets?
Peter: I learned from Cato. Remember my formative intellectual years were about how, energy, oil price regulation, energy regulation in the '70s, oil price controls. That was just stupid. Okay? It was an attempt to tax and transfer. It was a very bad-- We went to a crude oil windfall profits tax eventually, which never went into effect for various reasons, but price controls really, they weren't into price controls. They were into redistributing natural resource [unintelligible 00:38:57] from producers towards consumers. Same thing we're facing now, actually in energy, right?
Philosophically, actually learned-- I said markets work pretty well and people, I learned a value, autonomy, individual autonomy. People can relate to the notion of you get to go into the supermarket and buy what you want as long as you pay for it, and you can pollute as long as you want, as long as you pay for it, et cetera, et cetera. The important thing is you get to do what you want as long as the benefits and costs of said thing are confined as best we can tell to you. The minute you have consequences for others, we then need to have a conversation about whether it's worth it or not for the state to do something and on average, the answer is no.
In extreme cases, the answer is yes but the notion of autonomy as a value, I certainly probably felt it in my bone growing up in northern New York where people are stubborn and farmers get to do what they want, but then the philosophy and the associated intellectual apparatus associated with that didn't come about until I was at Cato and I learned from my colleagues about things I hadn't thought about in a way I hadn't thought about it. Even guns. Trevor is for shooting AK47s and I'm [crosstalk]--
Trevor: Hey, hey, hey. I just try to get you to shoot and you don't want to come shooting us.
Peter: I understand that our advocacy for gun rights and stuff. If we could get a and the constitution as a commitment device. I'm actually into that from a game theory, economics perspective. Because we all would try to raid everybody all the time if we didn't have commitment devices and the constitution is an attempt at a commitment device.
Trevor: I would just note real quick on the learning from the-- One of my favorite PVD moments was when you wandered into my office and just said, "So, can you tell me what this Cont guy thought?" It's a big question, Peter.
Aaron: This is why the wording philosophical, I was very afraid of using it, yes but I think you've gotten better over the years.
Peter: My humanities requirement at MIT was satisfied with economics. That tells you a lot. All the things you take for granted. All the liberal arts education that is the basis for everyone at Cato except me. I needed to pick up those things as a middle aged and beyond middle aged adult from my colleagues like you and John Samples who would come into my office and shake your respective heads and say, "You just don't know this stuff too, no."
Trevor: I have a question. We cut you off but we can get back to that but as I mentioned to Aaron, I think way before, just in text before we were recording this. What do you think a right is? Because many economists [crosstalk]--
Peter: It's something to be traded.
Trevor: Yes but is it-- We say that's a human right. To you are they just high cost preferences?
Peter: It's something you think the price-- It's like saying something has close to or ought to have an infinite price and to an economist that's the-- Well, then there's murder, right. Can I sell my right to live in return for a high amount of money? Yes and class maybe, but in the real world, no, that doesn't sound like a good thing. The right to die. Back to autonomy. I'm getting older and I don't want to end up not being able to have martinis and independence and they have rules in nursing homes. They don't let you do that. Am I going to be forced out living my days, having someone put a spoon in my mouth or do I get to choose? I can't do that. I need to go.
Many, many people don't like that conversation or discussion but it's autonomy. Cato will defend my right to have that choice and the Catholic Church will not. I respect their-- Their views are philosophically grounded and thus our two views, how do you reconcile them in the real world? The answer is, you can't. We have zero sum fights. Then the good news is we have states. We haven't talked about fed, right? We get to move to places that sort of-- Vermont and Maryland. Maryland is now a "Right to die" state. My brother lives in Vermont. I thought I was going to have to go up to his house to put the kibosh on me someday. Then looks like I'm going to be able to do it at home. It's just my [crosstalk]--
Trevor: You are correct. It's a way of thinking about it. Yes, I agree.
Peter: My aunt just died. She was 96 and she was rung up by the nursing home people for having beer and her doctor gave her a prescription for boxed wine through [unintelligible 00:44:50] because she was getting in trouble. Then an administrator come in and said, "No, we're confiscating everything." And it's like "Oh, come on."
Trevor: Did someone go? This is like a weird aside, but did someone go to a CVS and give a prescription to buy box wine? Who do you give a prescription box wine?
Peter: No, it was just in a nursing facility. This was a standing health order written by her physician that she could have Chardonnay. Then an administrator said, "No effing way. Not on my watch." One reason is the cousin-- My aunt wasn't married and so there were 37 nieces and nephews and second cousins once removed and all that. One of them brought a cooler once with beer and be stuffed under Clara's nursing home bed. Then it leaked and we forgot about it and then it got found out. We create just like the dorm party that went awry, but in your own home there's no administrator that's going to do that so, anyway. It's important.
Trevor: This has been a wide ranging conversation, obviously.
Peter: Yes.
Trevor: In terms of the way you approach a problem. Where you're asked about, "Hey, Peter, what do you think about--" People at Cato ask you about just about anything too. You'll send me papers about something to do with gun rights or something. Is there a way that you think about how to look at the good and bad papers, the good or bad ways of thinking about things when you encounter a problem?
Peter: We should have a discussion about love versus other things. I'm not trying to be negative here but lawyers tend to be into procedure as solutions to stuff. I get a lot of papers from lawyers that say, "Here's this tricky little thing I'm going to enact to make Congress have fewer rules," because I study regulation. My journal Regulation. The question is whether what's more useful? A Congressional Review Act as a solution to too much regulation or more articles by economists saying, "This doesn't make sense." In other words is the history of law such that, and here's my view. That clever people arbitrage around anything. The recent debt ceiling and the Budget Control acts that have occurred over time.
Is there any evidence they've really constrained Congress' behavior. Can we procedure people so that they lose? Well, they don't want to lose. They'll figure out a way to try to win.
I tend to be suspicious of solutions to policy problems that involve strictly procedure as opposed to trying to change people's preferences and or understandings of things from a substantive point of view. If I were to criticize legal solutions, they emphasize procedure, then to my mind at least, and you can correct me if you think I'm wrong, which is the history of procedural solutions, is that clever opponents to the outcomes procedure their way out of the procedural solutions. Thus, it's a never ending Full Employment Act for lawyers. It's not really a solution.
Trevor: I would agree, but the lawyers tend to either-- Some of them realize that a given law is just a complete boondoggle for people fighting over the meaning of the law. Some of them think as you said earlier in this podcast that the law that says X happens means X happens. That's a thing that I've always thought and you taught me over the years in a very-- That that is not the case. The law that says X happens. The Clean Water Act does not mean the water will be clean. The Gun Control Act does not mean guns will be controlled. What I've learned from you is that that approach to saying, what actually ends up happening, how is it enforced.
That's where we should be talking about this. But as you pointed out, no one really wants to hear about that. They don't want to hear about the nitty gritty. They want to hear about the signaling and the virtues. I always loved how, you've said for years that trying to get you to go on a Fox News broadcast to talk about something for three minutes is not your favorite thing to do because in three minutes one can talk about anything that matters or is important, really. People like Cato do a lot of that, and so trying to actually have conversations like this is what we should be trying to do, but are we going to influence voters with the Freedom podcast? Not in any significant way, and so we don't matter [laughs] [crosstalk]
Trevor: I don't know. I guess we've talked-- All the students I've had over the years, some of them can stay in touch with me, and they say I'm-- one of my favorite was he's the director of budgets, or director of Chief Economics. I forget his title, but he works for BART in San Francisco. He said, "I'm in there trying and I remember your class. I remember what you taught me, and it stuck with me. It helps me, I'm different than other people in the room, and that means they get to hear what I have to say and then that matters a bit at the margin," and so that's all worked.
Bernie Sanders is trying to do the same thing. We have to-- it's if you-- I think liberal, I don't know. These, for me, I think there's certain things that we don't talk about a lot because when confronted with things, it's not clear our views offer the answer. As you know I'm always, I'm most uncomfortable about the market distribution of income and what to do about poverty. I know enough about history to know that ever since the peasants lost their rights and the enclosure movement, there are people in markets in urban areas who have always-- who have done terribly for 500 years, and it's over and over and over again. Yes, markets are good, but for some people, things don't work out.
Then, what should we do about that? We say charity., and then, how do we-- I think we haven't fleshed out a robust charity state or charity thing and how a Salvation Army that was blown up or was bigger than it is now, somehow would do the job. Maybe for mental illness, we just, I don't know what to-- remember autonomy and if individuals are incapable of deciding in the way that I think we agreed, deciding means, was the old institutionalized state hospital system and it was horrible, but we are now on the other end of the continuum in which we do not know what to do with people living their lives out in their schizophrenic and they aren't housed and they live on the street. What do we do about that? Anyway, I don't know.
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Trevor: Thank you for joining us on Freedom. This is a listener-supported show. If you'd like to get access to episode transcripts, bonus content, extended conversations, and/or Discord community, go to freedom.audio/join.
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