Unfortunately dishonesty is a fact of life, and the best we can do is create institutions that generate incentives for reputation and honesty. We all know the typical Public Choice arguments for why politicians lie - they can get away with it because it's in no voters interests to monitor them - and yet there's no information problem. Possibly something subtler is going on. The "efficiency" argument for democracy has to conclude either that:
- Liars get voted out eventually, it just takes a little time (for efficient reasons)
- Lying isn't a bad thing (or at least it's compensated for through necessity)
I'm willing to accept the possibility of either. But note that this isn't a debate about where the truth actually falls - it's common knowledge that Gordon Brown is a bare faced liar. As Bagehot reports:
Part of the problem is—how to put it politely?—the prime minister’s proclivity, under pressure, to be prudent with the truth. It isn’t only his tricksiness with statistics, his fondness for misleading historical comparisons (for example, on inflation) and self-serving exaggeration (such as his wild rounding-up of poverty-reduction figures): all that is more or less routine, and passes unnoticed by most voters. Much more damaging have been his periodic assertions that black is white—as in his claim that Wendy Alexander, Labour’s leader in the Scottish Parliament, had not urged a referendum on Scottish independence, despite her call to “bring it on”, or his avowal that no inducements had been offered to Unionist and backbench Labour MPs this month in return for their votes on his counter-terrorism plans.
The mother of all such incredibilities, however, was Mr Brown’s insistence, after he called off the general election he almost held last autumn, that his decision had nothing, repeat nothing, to do with alarming opinion polls. As tends to happen, it was this cover-up, as much as the minor crime of cowardice, that hurt him. Probably Mr Brown believes that his higher moral purpose justifies such distortions. But they have cost him the respect of political journalists, and through them the faith of the public.
For sure, he'll probably get voted out next time around, but I don't understand how defenders of democracy can be so complacent about having a PM that will knowingly lie. Perhaps it's because it's part of the job. In the US we see Presidential candidates say one thing in the Primaries, and another in the Presidential race. Obama's economic advisor briefs people not to take his claims too seriously. As Bryan Caplan says,
Politicians predictably lie to get elected (and unless winning primaries somehow "causes moderation," lying is precisely what Westen [author of 'The Political Brain'] is describing)...
What's hard for me to understand on an emotional level is how Westen - or anyone - can recognize the above and remain an enthusiastic partisan
There's two recent examples of corporate dishonesty, that have swiftly been dealt with. Severn Trent have been fined £2m, and Virgin Media have been 'rapped' by the ASA. We might have a discussion about whether this is a triumph of regulation, but surely it's clear that there are market punishment mechanism also at play. I just had a look at the Virgin share price which fell significantly on July 1st with a spike of heavy trading. I assume this coincides with the news. The city investors that I know (and I do know a few) do not like false accounting. In business lying creates criminal proceedings, in politics it does not. In politics it's part of the job.
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