In government, it’s not just a matter of having the best policy; it’s about getting enough votes. This creates a problem when the self-interests of individual voters don’t match the best interests of the country.
For instance, voting researchers widely consider the presidential voting system in America to be inferior to many alternatives. But if you want to change it, you require consent from Democrats and Republicans—i.e. the very people who benefit from the status quo.
Or consider the land-value tax. This tax is considered among economists to be uniquely efficient (i.e. it causes zero reduction in the good being taxed). When implemented correctly, it can address edge cases, such as new property developments, and can even prevent reductions in new land production, like the creation of artificial islands. However, this policy is against the interests of current land owners. So any politician who advocates this policy would not only fail but also likely end their political career.
What do these policies have in common? Well, both policies yield long-run benefits, and as we’ll see, they impose short-run costs. (If you disagree that these policies are actually beneficial in the long run, I’m sure you can think of policies that you like that have long-run benefits and short-run costs. The examples I’ve given are simply for clarity.)
What if rather than asking American politicians to vote against their own interests, we ask them to pass a policy today that will only be enacted after a 100-year period? Significant advances in medicine notwithstanding, by that time, most of today’s politicians will be dead. In other words, they no longer have to vote against their own interests.
The same strategy can be applied to land value taxes. If today, we passed a policy for a 100-year delayed land-value tax, the effect on house prices is approximately zero (see the widely-accepted net present value model of asset prices).
I believe this strategy offers a significant opportunity. Policy in the EA community is often seen as too hard because of how crowded it is. Yet almost no policy makers are thinking about the future in 100 years. It might be possible to pass a lot of “unpassable” policies. We just have to ensure the policies we propose are actually good (see my unfinished series on the topic), and have large barrier to reversal, so that the politicians of the future can’t renege on the government’s commitment when the day of implementation arrives.
I have a follow-up post here: Enforcing Far-Future Contracts for Governments.
Let me start by saying I think I really should have said 50 years instead of 100. That seems to a big sticking point for people.
I haven't made myself clear. What I'm saying is create a contract to enforce the institution of a law. The government is the signatory, not any particular person. Governments can and do hold by agreements that past governments made, even if they disagree with their predecessors.
Now, sometimes they break those promises, and that's why I'm talking about creating a binding contract. As in, if you break the contract, a penalty occurs.
For example, let's say the government issues $1T of a particular financial asset. Those assets are basically inflation-adjusted perpetuities, except upon the institution of the delayed law, they cease to pay out. (Unless the law is instituted before the 50-year period, in which case they only cease to pay out after 50 years so that the perpetuity buyers aren't swindled.) If the law is not instituted, then they continue to be perpetuities.
Upon selling those "enforcement perpetuities", the government splits the ownership of land and buildings. So if you own a house, now you own the house itself, as well as a financial asset for the land underneath it. The land asset pays off a cashflow equal to the land value (if you're taxed $1000 on Jan 1st, the government pays you $1000 on Jan 1st). Now, the money raised from the enforcement perpetuities can be used to buy those land assets from all current landowners.
Maybe you'd call this an incentive mechanism, rather than a contract. Whatever, I'm not a legal expert. Whether that's the best solution or not, I don't know. Even if there's something wrong with the contract I just laid out, I would be shocked if there were not a way to do this. I'm sure there are plenty of creative solutions.
Obviously, that particular solution doesn't apply to all delayed laws. Different laws will require different solutions. For the voting system problem, make a constitutional amendment requiring a unanimous vote to overturn it.