The Evaluative Worthlessness of Happiness

I've been dipping into the literature on the measurement of happiness, and the most stunning thing about happiness is that it is so incredibly robust. It seems that there is almost nothing one can do to significantly and permanently alter one's natural temperamental disposition to happiness. Most people in most places are pretty happy. Income means very little. People who suffer horrifying disfigurements and disabilities usually bounce right back to their happiness “set-point.” The Minnesota twins studies show that hedonic tone is to a large degree genetic. It seems that even people in prison aren't a whole lot less happy than people not in prison. Freedom and democracy mean something, but not that much. If you're on good terms with your family, have close friends and meaningful work, you're probably doing about as well as you're going to do.

All this implies that any form of happiness-consequentialism is pretty much useless as anything more than a very brute standard of evaluation. I have yet to fully process what this really means. (It does mean that the Objectivist subjective-happiness-as-barometer-of objective-life-success view is plain false.) I do think this pushes me to a more Scanlonian view according to which our reasons for action are not even close to exhausted by considerations of “well-being.” If being more free, more healthy, and so forth do not cash out in terms of happiness, then so much the worse for cashing out value in terms of happiness.

Additionally, I think the methodological implications of the happiness research on measurement problems in economics have yet to be digested. Consider the concluding paragraph of Krugman's excellent essay “Viagra and the Wealth of Nations“:

In other words, as soon as you try to think seriously about how to measure Viagra's effect on the nation's wealth, you realize what a dubious enterprise such comparisons are. I have nothing against calculating real G.D.P. as accurately as possible; we need that number for all kinds of purposes. But the rather vulgar case of Viagra reminds us that, in the end, economics is not about wealth — it's about the pursuit of happiness.

Krugman seems to be saying that “problem of Viagra” is not simply a problem for calculating the effects new innovations have on material wealth, but a problem for determining the effects of innovation on happiness (which is what wealth really amounts to). But if we take the happiness research seriously, almost nothing has much effect on anyone's long-term happiness. So if we are to say what makes it better to have Viagra than to not have Viagra (or whatever), then we're going to have to say something about our reasons to value more possibilities, more choices, and enhanced abilities. But what we have to say is not going to be much about happiness. That is to say, “wealth” isn't a measure of happiness, either. My intuition about what wealth is: a garden of forking paths leading to multitudes of possible lives.

  • John V

    Yes. Nice. I’m not a “supply-sider”. I don’t like the term. I’m simply a classical liberal who acknowledges that we all do better individually as well as a group (insofar as “a group” even matters) when we operate, work and live under less tax burden. The $80K household, from OK and MI to NYC and DC does better when it keeps more than $50-55K of its income….as does the $130-150K household…who are not “rich” by any means when they live in an expensive metro area. I’m sure Will can vouch for that. Corporations and small businesses also do better with lower tax rates.

    After all, it’s about individuals minding their own business and providing for the welfare and happiness of their families.

    The huge burdens placed on our government budgets are self-inflicted by those people…just as many of the high costs we have to endure are rooted in the same source.

    Arsonists make poor fire fighters.

  • muirgeo

    “Today, there is a mismatch between social and private returns. Unless they are closely aligned, the market system cannot work well. ”

    From; The end of neo-liberalism?

    By Joseph E. Stiglitz

    http://www.dailystaregypt.com/article.aspx?ArticleID=14905

  • mk

    I asked Tyler Cowen about this a while ago. Doesn’t it seem like tax cuts should always help in the long run? A slightly raised growth rate will eventually more than pay for the initial 2,5,10 years of reduced tax receipts.

    Now I take it the financing aspect (borrowing so extensively from future revenues) is problematic if the projected gains are very far in the future. So running massive deficits today because taxes are at 1% is probably too theoretical to be workable.

    Nevertheless at a minimum this line of argument does provide medium/long-term support, besides the usual short-term argument, that cutting taxes can be good even without immediate spending reductions.

    Practically speaking, the problem is that an experiment or comparison along these lines takes a very long time to complete (maybe 50 years or more), because the primary mechanism is the compounding effect of growth. So it is hard to get a scientifically rigorous picture of the situation.

  • jumbolachi

    What would have been “nice” is if the author had cited somebody who thinks that tax cuts are always bad. This shouldn’t be a difficult task, since the author seems to be claiming that such sentiments are becoming ubiquitous.

    I am afraid that the author could be confused about the difference between people who think that all tax cuts are bad for the economy (these people are probably few and, if they exist, in need of mental help) and people who think that tax cuts are a bad idea when government debt is ridiculously high and growing faster than ever, our infrastructure is in dire need of maintenance, and fee-based services (such as publicly-provided higher education) are becoming more expensive.

  • muirgeo

    John V wrote,

    “I’m simply a classical liberal who acknowledges that we all do better individually as well as a group (insofar as “a group” even matters) when we operate, work and live under less tax burden.”

    Well as I understand you got your wish and the marginal tax rates have successively been cut since Reagan. So how’s that working out for the economy? Well, I mean for the other 99.9% of us?

    http://www.visualizingeconomics.com/wp-content/uploads/income_top_0_1_marginal_tax.gif

  • muirgeo

    “A week ago, Bridgewater Associates, a research firm, estimated that losses from the credit crisis we’re now mired in might amount to $1.6 trillion when all is said and done.

    We’ll have to wait years to see if this is accurate. But whatever the number is, it will also represent, in stunning red ink, the cost to society of financiers who are shortsighted and greedy and regulators who don’t regulate. ”

    From;

    http://www.nytimes.com/2008/07/13/business/13gret.html?_r=2&hp&oref=slogin&oref=slogin

    So what explains the current market failure? Well at least the total failure that was preempted by government intervention. Taxes have been cut and so have regulations. How does the libertarian keep his ideology alive in such a hostile environment?

    I know the likely answer is we haven’t really cut taxes and regulation enough. But the practical question begs an answer. Every time we seem to take even baby steps toward liberaltopia we get our asses kicked. So what gives?

  • WilsonF

    Muirgeo: Pretty freaking well I’d say.

    Median Income in 1980 (2006 dollars): $41,258
    Median Income in 2006: $48,201

    17% growth. . .what a disaster since Reagan.

    Pithy yes, but no more so than your own reply. My data is certainly more meaningful for the well being of the ‘rest of us’ than your data.

  • muirgeo

    Wilson,

    Productivity increased 70% and individual and family work hours went up significantly to compensate.

    http://www.stateofworkingamerica.org/tabfig/01/SWA06_Fig1E.jpg

    http://www.hartford-hwp.com/archives/26/077.html

    And Reagan, yeah he was a disaster. And a criminal selling arms illegally to the Iranians. And he massively/ regressively increased social security taxes. He started amnesty for illegals. He set us back on the path to oil dependency. The economy we are seeing now is pretty much the long term results of his vodoo economics.

    http://zfacts.com/p/318.html

  • He started amnesty for illegals.

    Wait, you consider this a bad thing? What a fucking hypocrite you are, muirgeo. Your professed concern for income inequality is a complete joke now that you have admitted you really only care about people lucky enough to be born in America.

    And for the record, you still have not done your econ homework, muirgeo. Until you understand what Hayek means by central planning, you have no room to talk about anything resembling the subject.

  • Dynamic scoring is pretty mainstream now, so if “supply side economics” just means that tax rate increases do not result in proportional increases in revenue, no one economically literate denies it. Nor would anyone disagree that there must be some peak to the Laffer curve — at some point increasing tax rates decreases revenue. Unfortunately, “supply side” is irreversibly associated with the idea that the contemporary US is at that point, so that tax cuts pay for themselves. So there’s no tradeoff between taxes and expenditures — just party like it’s 1999. Cheney’s “Reagan proved deficits don’t matter” comes to mind. That’s what people mean by “supply side economics” and it really is discredited.

  • $54123764

    I agree with Pithlord. The phrase “supply side economics” has become taboo, and its use distracts otherwise reasonable people from giving your arguments a fair shake. We should abandon the term, but continue to honor the credible ideas associated with it.

  • mk

    But if we agree that we can raise the growth rate by some delta by lowering taxes, doesn’t it straightforwardly follow that all tax cuts ultimately pay for themselves?

    The argument is simple math; it may be wrong for some reason but I don’t see how.