brazzy comments on Rationality Quotes: June 2011 - Less Wrong

4 Post author: Oscar_Cunningham 01 June 2011 08:17AM

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Comment author: MichaelGR 02 June 2011 06:37:39PM 32 points [-]

"At one of our dinners, Milton recalled traveling to an Asian country in the 1960s and visiting a worksite where a new canal was being built. He was shocked to see that, instead of modern tractors and earth movers, the workers had shovels. He asked why there were so few machines. The government bureaucrat explained: “You don’t understand. This is a jobs program.” To which Milton replied: “Oh, I thought you were trying to build a canal. If it’s jobs you want, then you should give these workers spoons, not shovels.”

-Milton Friedman story

Comment author: brazzy 03 June 2011 09:09:01AM 25 points [-]

A few points come to mind:

  • Presumably they also wanted a canal and there may well be an optimum point where you maximize some sort of combined utility
  • Jobs programs, even those that create nothing particularly useful, are about giving people a sense of worth and accomplishment, otherwise you could just hand out money. Obviously futile make-work activities like the one suggested achieve the opposite of that and are, indeed, often deliberately used to punish and humiliate people.
Comment author: Mercy 06 June 2011 11:51:22PM *  10 points [-]

"They" is the tricky bit there. Presumably some people wanted a canal, and some people other people wanted jobs, and for that matter presumably some people wanted money to go to the construction company who've got an opening for a government liaison consultant coming up in five years time. There's little reason to think the equilibrium is welfare maximising.

Comment author: MarkusRamikin 26 June 2011 07:31:03AM *  7 points [-]

Probably, but Brazzy's explanation without adding all those other variables fits well enough to show why Milton's statement might have been missing something important. The point of a jobs program is that society pays some cost (of not using the most optimal method, i.e. more machines and fewer workers) in order to keep its members out of the unemployment trap. To propose, even as a deliberate reductio ad absurdum, that this would go just as well with spoons rather than shovels is not rationality, it's Spock-logic.

Now I'm quite willing to suppose that he understood the usefulness of such programs as an economist and overall had good reasons to see them as not worth it, or that some other measure would do better, but that particular quote fails to show it.

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