(The third in a series of interviews with the great philosopher)
[Aristotle returns from the pub to which he retreated for a well-earned respite after discussing Robert Constanza's suggestion that we value nature as "natural capital", in "Aristotle shows up in Ecology 101" (http://environmentalvalues.blogspot.com/2007/09/aristotle-shows-up-in-ecology-101.html).]
The truth in natural capital
A: Well that was quite refreshing.
H: Yes indeed.
A: Three Philosophers Ale is quite a brew. Do you think that I'm one of those Three Philosophers? I mean, you could make a much better case for me than for Plato. With all due respect to my mentor, I'm skeptical that even a Philosopher King could truly enjoy the Form of Beer. Me? I'd rather just quaff some sensible suds, hang out in a cave — Philosophy Corner would do just fine — and debate the merits of valuing nature as natural capital. The Form of Beer will never tickle anyone's taste buds...
H: No doubt, a debate to have with Plato over a few more brews. But right now, we're anxious to get back to what we discussed last time — you know — Mr. Constanza's project of valuing natural places as natural capital.
A: Yes, this is one of the most important and most urgent topics of the day.
H: Mr. Constanza and his colleagues undoubtedly lack neither good intentions nor intellectual prowess. And a great many other equally well-intentioned and brilliant thinkers — some of our most eminent scientists and economists — have joined his project. It's so seductive to think of natural places as capital investments. It all seemed such a promising, even natural way to demonstrate the stupidity of reckless disregard of our natural resources — until you pointed out that it leads us to such absurd conclusions.
A: Yes indeed. I propose that we inquire into assumptions that underlie the natural capital valuation project. Perhaps we shall find that that RompInASwamp DevCo aren't the only ones building on a quagmire.
H: That's exactly what we were hoping for...
A: That will help set us up for a time when we might find a more satisfactory way of valuing nature by exploring some elements that are missing from the natural capital picture.
H: Splendid! Well, why do you think that Constanza's project is so appealing?
A: I think that there are many reasons. But the one I'd like to focus on first is that there is undoubtedly some truth in it.
H: Whoa there, Mr. A. I thought that you were going to help us see just the opposite. I mean, how else would it endorse such crazy things as casually trashing deserts or turning every swamp into a condo complex when that presents the greatest economic benefit?
A: We shall see about that. But I'd like to start by acknowledging the truth of one of Mr. Constanza's most fundamental premises — namely that nature provides a host of resources that we draw upon to satisfy a great many human needs. It provides the raw "stuff" for us to make many of the things that we desire and to satisfy our many and varied preferences.
H: That's certainly true.
A: No one can doubt that we "make a living" from nature...
H: Right.
A: ... or that nature has value to us because of that.
H: So Constanza didn't get everything wrong...
A: Not at all.
H: Then why not go with Constanza's project of setting the right price for nature and her services? Isn't it better to have some number that represents the value of a natural system than no number at all? Won't that at least give us some way to ask whether we'd be better off by going ahead with the next project that destroys part of our natural heritage?
Consequences for human welfare = the true measure of an act?
A: Excellent questions! I sense an inquiring rational soul at work.
H: Thank you, Mr. A. Coming from you, that's quite a complement.
A: Perhaps the most fundamental question we should ask is whether the consequences of an act, and particularly, the state of human welfare that derives from it, should be its true and only moral measure. Some might say that we sometimes, often, or even always should choose to act in a way that fulfills our duties and obligations to others, and that honors the just demands of others on us — even we thereby decrease overall welfare. I think that my buddy Manny might say something like that.
H: Sure, sometimes it's more important to just keep a promise to a friend — even if it might mean forgoing some significant preferences of our own and even if they likely outweigh the benefits for our friend.
A: An excellent example. And there are others who, when considering a particular act, might wish to focus on whether we would want to be the kind of person who would do it. I can't imagine who might want say that. But that doesn't sound totally crazy, does it?
H: I wouldn't have thought of that. But now that you mention it, I sometimes find myself thinking in just that way, too.
A: A man after my own rational soul. But let's begin by assuming that the outcome for human welfare is the right way to evaluate our actions.
H: Well, ok. Though you've made me pretty doubtful...
A: Does it follow that the price that such an outcome commands is the true value of the welfare that it provides?
H: Why wouldn't it be?
Price = Value?
A: An astonishing question. My first question would be, "Why in Macedonia would you think that it does?"
H: Gee, how could you not think that?
A: Let me tell you about a chat that I had with a bloke in that brew house. Called himself "Adam". Beat us Theatetus, could he belt down those Scottish ales.
H: Adam..., Adam..., common last name? Rings a bell...
A: In between pints, and before he slipped under the bar, he managed to write this down for me:
The word VALUE, it is to be observed, has two different meanings, and sometimes expresses the utility of some particular object, and sometimes the power of purchasing other goods which the possession of that object conveys. The one may be called "value in use"; the other, "value in exchange". The things which have the greatest value in use have frequently little or no value in exchange; and on the contrary, those which have the greatest value in exchange have frequently little or no value in use. Nothing is more useful than water: but it will purchase scarce any thing; scarce any thing can be had in exchange for it. A diamond, on the contrary, has scarce any value in use; but a very great quantity of other goods may frequently be had in exchange for it (Book I, Chapter IV)... The real price of every thing, what every thing really costs to the man who wants to acquire it, is the toil and trouble of acquiring it (Book I, Chapter V).
A. Smith, "An Inquiry into the Nature and Causes of the Wealth of Nations", 1776 (http://www.econlib.org/LIBRARY/Smith/smWN.html)
H: Ah, so he's saying that there's no real relationship between price and utility for people. The price reflects the amount of labor...
A: ... a "factor of production"...
H: ... not its effect on welfare. That puts a pretty big dent in the theory that the price of something is a measure of its value for human welfare.
A: Exactly so. On the one hand, there's value in use -- the true utility of something — its true significance for human welfare. On the other hand, there's its value in exchange -- in the marketplace. What Adam wrote down for me shows us why we shouldn't expect any particular relationship between the two. Of course, that's the old labor theory of value -- the classical view. Modern economists — the neoclassical dudes that I call "econo-consequentialists" — don't buy it... so to speak.
H: Damn. I thought we had that one nailed.
A: Yeah, well, when I brought up the neoclassical view, poor auld Adam slid off his stool and slipped under the bar.
H: He felt kind of marginalized?
A: Hah! Exactly! Talk to any self-respecting neoclassical economist these days, and she'll say the price of water isn't a matter of how much labor went into its production. The price isn't even a matter of the total value of all the water in the world.
H: No?
A: Not at all. What counts is the water's marginal utility. The price for a unit of water is what a person is willing to pay to satisfy her last and least important desire for it. With abundant supplies, one needn't worry about its vital role in human survival. Instead, its price comes down to what we're willing to pay to use it to wash off sidewalks. But diamonds are so scarce that those who want them are willing to pay a way higher price for one than for a glass of water. A diamond's marginal utility, hence its price dwarfs that of water.
H: Amazing.
A: What I find amazing is that, if poor auld Adam hadn't had quite so many ales, he would have realized that those neoclassical dudes just take a different route to the same conclusion. The price of a thing does not reflect its value for human well being — not even insofar as that well being is a matter of how needs and preferences are satisfied. Economic theory — either classical or neoclassical — refutes that interpretation.
H: Wow.
A: Why do you find this surprising? Consider how, according to Stuart Pimm, Constanza and friends place the astounding $17 trillion price tag on nutrient cycling by the oceans. According to Pimm,
If the oceans were not there, re-creating their nutrient cycling would require removing the nutrients from the land's runoff and returning them. The estimate of this service's $17 trillion value is arrived at by multiplying the cost of removing phosphorus and nitrogen from a litre of waste water by the 40,000 cubic kilometers of water that flow from the land each year.
S. Pimm, "The value of everthing", Nature, 387, 15 May 1997, p. 232 (http://www.nature.com/nature/journal/v387/n6630/abs/387231a0.html)
There's a problem, though.
H: Which is...
A: ... that, according to Pimm, at least "In the short term, many would not notice (and perhaps not care) what happens to the elements as they flow into the ocean." (p. 232) So by the principles of preference consequentialism that underlie this valuation, that price grossly overestimates its true value for welfare. But say that we devise a wondrous technology that reduces the cost of P and N removal and recycling by a factor of 1,000,000. The price would then be a mere $17 million/yr. — a veritable bargain. Are we to think that such technological innovation reduces the value of the oceans for us? That a breakthrough technology would make the oceans dispensable? Would that make it ok for us to start heaving all our waste into them? Would we be free to stop worrying about eutrophication? Would that be the signal to start building pipelines to convey all our toxic wastes to the ocean?
H: That doesn't seem right.
A: I think what you feel is that, even if part of the value of the oceans has to do with nutrient cycling, not all its value derives from that. In fact, viewing the oceans simply as a resource for our use may fail to capture the most significant values of the ocean for us.
H: But wait a minute.
A: Hey man, I don't know about you, but I've already been waiting for two and one-half millennia. I can spare a few more moments or so.
H: We really appreciate your patience, Mr. A.
A: It's rather embarrassing, but we philosophers are not known for the speed with which we solve problems.
H: Ok, you've convinced me that price is pretty shaky stand-in for welfare value. As you've pointed out, economic theory itself — both classical and neoclassical — undermines that interpretation.
A: It's rather worse than that. Not only are Constanza and Pimm in error by presenting the supposed market price of nutrient cycling as its value for human welfare, they don't even get the market price right. I confess that Environmental Economics was not in the Lyceum curriculum. But I'm pretty sure you'd flunk the Stanford course if you used Pimm's substitution logic. To determine the true market price of a thing or service, a modern economist doesn't ask "What would it cost you to do that?" That's pretty much auld Adam's cost of labor theory. Instead, the neoclassical economist figures out our willingness to pay using contingent evaluation interviews. She would ask, "If it cost you $17 million to cycle N and P, would you buy that service? Yes? Ok, how about $17 billion? Really? How about $17 trillion?" if the economist's interlocutor says, "Jeez, Socrates; I'm gonna take my $17 million and buy myself 17 million lottery tickets instead — then that's the market price. A pretty crummy dialogue by Plato's standards. But I guess that modern economists doing contingent evaluation don't have his panache.
H: Ok, so let's make those ecologists take Environmental Economics before we let them publish again in "Nature". In the meantime, let's look at the bigger picture. Water and diamonds and nutrient cycling are only a tiny part of all the myriad things that we need and want. Aren't welfare economists just finding a way to express our preferences — and with a very satisfying mathematical precision, at that? Doesn't our welfare increase to the extent our preferences are satisfied? Can't we quantify our preferences for things or states of affairs by how much we're willing to pay for them — at the margins, as you say — by determining or estimating their price?
A: There are a raft of further assumptions behind those questions and we should look into them. As we've already seen, the market price of a thing has no necessary or even empirically observable connection with its value — considered as the importance of that thing for human well-being or flourishing.
H: But I can't help thinking that we could find a way to reconnect them.
A: Let's look at some other assumptions first — to see if that's the only problem.
Needs = preferences?
H: Ok, Mr. A, what's the next assumption?
A: That preferences and needs can be considered as one. Economists lump them into the basket of market "goods" that we might be willing to pay for.
H: How do you mean?
A: We all have a need for water and food. The nutritive part of our soul, which we share with all other organisms — plants and animals alike — and which is the source of our natural capacity to grow and reproduce, cannot flourish without food:
The nutritive soul then must be possessed by everything that is alive, and every such thing is endowed with soul from its birth to its death. For what has been born must grow, reach maturity, and decay-all of which are impossible without nutrition. Therefore the nutritive faculty must be found in everything that grows and decays.
Aristotle, "De Anima", Book III.12, tr. J.A. Smith (http://classics.mit.edu/Aristotle/soul.3.iii.html)
H: Can't get any more basic than that!
A: Right! And because we humans are social animals, certain kinds of relationships with other persons are also necessary to us. For example, we cannot flourish without friendships — for we need friends to develop and exercise our natural capacities as the kind of social animal that can take another's interests as one's own:
[Friendship] is a virtue or implies virtue, and is besides most necessary with a view to living. For without friends no one would choose to live, though he had all other goods; even rich men and those in possession of office and of dominating power are thought to need friends most of all.
Aristotle, "Nichomachean Ethics", Book VIII.1, tr. W.D. Ross (http://classics.mit.edu/Aristotle/nicomachaen.8.viii.html)
H: That's a pretty strong claim. But I'd be hard pressed to contest it.
A: There's no possibility of a person flourishing in the absence of these sorts of things. In fact, we would suffer serious harm without them. They are independent of beliefs and position in life and even our ongoing projects in life because they arise directly from the very kind of living being, the kind of animal that we are.
H: But preferences...
A: ... are unlike needs in key respects. They depend on beliefs and on one's position in life. We can be mistaken about our preferences and prefer things that are not at all good for our well-being. We may mistakenly think that drinking six pints of ale every night with two scotch chasers bolsters our spirits and is good for us.
H: Like poor auld Adam, it seems.
A: Ah, he barely got to his third. But there's a related distinction that may be even more important.
H: And that is...
A: ... that our preferences, in contrast to our needs, can develop and change -- sometimes in profound ways -- as we develop our natural human sensibilities and become aware of relationships or new dimensions in relationships that we have to other things, other organisms and creatures, and to other persons in our world. Where the real estate guys at RompInASwamp DevCo see only a mosquito-infested and inconveniently water-saturated tract of land on which to build lucrative condos, the trained ecologist sees a vibrant community of plants and animals interacting with the "stuff" of an increasingly rare kind of place that presents conditions in which that kind of community can flourish. The developer sees a resource, a means for satisfying her preference to enrich herself. The home-buyers see a prestigious home site that satisfies their preference for the offered amenities. But the ecologist sees a place with a special kind of bio-geological history that gives it a correspondingly special place alongside and in relation to human beings.
H: In other words, ecology scientists such as Constanza and Pimm should see some kinds of value in swamps that have nothing to do with the services that they perform for us?
A: Yes, and it's a pity that they, of all people, don't insist on including such non-market values in their discussion of the value of places.
H: So we need to take care that we don't lump preferences together with needs. What else do we need to be wary of?
Willingness to pay = justice?
A: Remember that notion of "willingness to pay" that we mentioned?
H: Sure. That's how neoclassical economists measure the strength of our preferences.
A: Right. So we need to ask what "willingness to pay" really measures. Consider this. Economists ask themselves whether or not it's ok for people to die as the result of proposed policy — say to allow an industry to dump toxins into a river at a certain level.
H: Gee, doesn't that already violate the distinction between needs and preferences that you already discussed?
A: It does, indeed. But there's another point to be made. As Stanford economist Lawrence Goulder explains ("Benefit-Cost Analysis, Individual Differences, and Third Parties", Februay 2007, paper prepared for the conference, “What We Can Do To Improve The Use Of Benefit-Cost Analysis?” University of Washington, May 18-19, 2006), "The key statistic in this context is the value of a statistical life (VSL), which is calculated based on each affected individual’s willingness to pay for the change in the statistical probability of death that applies to him or her." And guess what? Rich people are far more willing to pay to increase their survival chances than poor people.
H: Well Plato's tomatoes, they've got the money to do that, and the power to make it happen.
A: Of course. So on the watch of the neoclassical economists, the life of a poor person is worth less — often considerably less — than the life of a rich person. Of course, when we say that, we mean the "the value of a statistical life". But actuarial tables play out in the real world with real human lives. By economists' evaluative rules, it's better to pay for toxic pollution by cutting short the life of a poor person than of a rich one.
H: I can see why you're not too keen on econo-consequentialism. Doesn't it have some sense of justice?
A: Perhaps, as an afterthought. Goulder, for example, claims that rich people have a preference for the poor not to suffer unduly. Taking that preference into account would even things up a bit.
H: So we are to find the value of poor people in rich persons' sympathy for their suffering? There's something even more appalling in that response than the obvious injustice of discounting poor lives in the first place.
A: What we are observing is the retreat by neoclassical economists from the principle of equal consideration. That principle was maintained by their classical utilitarian forerunners such as good old Jeremy Bentham. On his account, the pain of every person — perhaps even every sentient creature — counts equally.
H: Now that sounds fair.
Maximizing welfare = justice?
A: Fair in the respect that all are considered equally, but still not fair in how goods and harms may be distributed.
H: How so?
A: In the bad old days of classical utilitarianism, consequentialists took themselves to be simple-minded utility accountants. For the consequences of some act, add in Meno's increase in utility. Subtract the decrease for Zeno. Do that for all positively affected Meno's and all negatively affected Zeno's |
The naked Archimedes (c 287-212 BC) running through
the streets of Syracuse shouting 'Eureka!'
From the title page of:
'Notizie istoriche e critiche intorno alla vita,
alle invenzioni,ed agli scritti di Archimede siracusano'
(Historical and critical information about the life,
inventions and writings of Archimedes of Syracuse)
by Count Giammaria Mazzuchelli (1707-1765),
published 1737, Brescia, Italy. |
and ηὕρηκα, um, voilà (that babelfish is quite something) you have a rating for that act and possibly one very excited economist running around naked holding up a sign with that number. Another economist takes another possible act, does the Meno's/Zeno's calculation for that alternative, and there, you've got two naked economists running around, each with their own number. Pretty soon, you have a mighty ugly sight. But barring the unlikely outcome of a tie, only one of those economists will be running around with the highest number and the others will have to get dressed and go home.
H: Whew. I was worried that things might be getting out of hand.
A: There may be disagreement about the ingredients for utilities in these calculations. My buddy Jeremy Bentham would keep it simple, restricting the calculus to pleasures and pains. John Mill would muddy the waters by throwing in most preferences (including the preference to experience pleasure and that to avoid pain), with some kind of, if you'll pardon the expression, preferential preference ranking. But in the end, it's basically a matter of addition and subtraction — modified only by weighting a pleasure or pain by its strength, or by weighting a preference by strength and type. The total welfare that is results from a choice — the summation of its consequences, both positive and negative — is what counts in comparing that choice to others.
H: Without using willingness to pay to measure preferences?
A: Right. The pleasures and pains of all count equally; or if you prefer, the preferences of all count equally.
H: How could that be unjust?
A: Injustices may result when some persons derive more utility from a choice than others. If the choice that maximizes the utility does so by providing enormous benefits to some, and the sum of those enormous benefits far outweighs (in the calculus) an enormous suffering that it inflicted on many, but fewer others, then classical utilitarianism would endorse it.
H: Even if the sufferers were in the minority, that would not be very just, would it?
A: Especially not in that case. That is what some would call the tyranny of the majority.
H: Yes, I can see that. Where do you think the calculation goes awry? It seemed such an unassailably good idea to choose those acts and policies that maximize welfare.
A: Ah, the question of justice brings us to yet another major question.
H: Which is...
Additivity of utilities?
A: Why, in the first place, should we think that we can we can meaningfully add and subtract the pleasures and pains of different people, or their preferences for different goods that they suppose are constitutive of their well-being?
H: Well, if Bentham is right, and our welfare is just a matter of pleasures and pains, it doesn't seem too hard to think of adding and subtracting them.
A: Even restricting our attention to pleasures, aren't there a plethora of different kinds? Do you really suppose that you can compare the pleasure of one person in being awarded a degree in philosophy with another person's pain in knowing that a departing friend will never again be seen?
H: I see what you mean.
A: Going beyond Bentham's simple world of pleasures and pains, consider the infinitely more diverse set of goods that might be the subjects of our preferences. Consider, for example, a preference to have good and fast friends. Can that be added to or subtracted from a preference to lead an autonomous life, free from the shackles of slavery? Can we say that a slave living in the most ignominious conditions is compensated by the fast friendships that, in her position, she can and does develop with her fellow slaves?
H: That would seem to be a tough proposition to endorse. But couldn't there be a way to compare two preferences without having to have some absolute rating of each?
Maximization and rights
A: Willingness to pay is one way to do that. That concept is, among other things, a tool that may appear to make possible a comparative measure, a ranking of all preferences. But we saw how quickly it leads us to an unjust distribution of the satisfaction of those preferences. There is yet another problem with "willingness to pay" that perhaps I shall leave for the end of today's interview.
H: Gee, Mr. A. It doesn't take too hard a glance at utility maximization to make it crumble before your eyes.
A: Yeah, it's kind of the reverse Gorgon effect. We philosophers are pretty good at it.
H: Are there any more questions on your list?
A: Well, our discussion of the utility arithmetic used in utility maximization serves well to introduce what may be our final question for today — which is, in fact, the first question we asked. Even if it makes sense to add some persons' preferences according to its strength and type, and to similarly subtract the preferences denied others, why should we think that maximizing preference values is the only thing that we should value in our moral considerations?
H: Well, I guess we've already shown that the distribution of goods counts. And man, maximization can really screw that up.
A: Yes, and the injustice of maximization doesn't end with the inequitable distribution of utilities. What about respect for basic rights — such as the right to autonomous existence, free of physical and intellectual enslavement? What if a system of enslavement maximized total human welfare? And what about the right to satisfaction of basic needs? Remember how we distinguished them from mere preferences? In considering one person's need for water directly against another person's preference for a 5-bath, 6-bedroom house instead of much more modest but perfectly adequate shelter launches us into morally troubled waters. Placing both on an equal footing inside the same calculus makes it possible to violate the basic right to satisfy such a basic need in the interest of maximizing preferences (broadly construed to include needs).
H: Well that seems to be all the more reason to get away from this maximization thing — this business of adding your utility and subtracting mine.
A: Spoken like a true neoclassical economist. Such an economist would say that you are onto something.
H: Really?
Justice of efficiency?
A: Indeed. Efficiency and Kaldor-Hicks compensation.
H: Huh?
A: The method of choice — the test of so-called "efficiency" — that neoclassical economists propose in place of maximization of welfare.
H: How does it work?
A: Maximization calculations are made on the problematic assumption that the preferences of Menos and Zenos can be assigned numeric values that can be added and subtracted in the preference calculus. Latter-day economists have invented the notion of economic efficiency precisely to avoid that — and thereby avoid the concomitant problems that we've unearthed.
H: That may not be a bad thing.
A: Not at all. So let's see how it works. This notion of efficiency builds on the notion of Pareto improvement. That's a change resulting from some act or policy which at least one person prefers but to which no one objects. One reaches Pareto optimality when no further Pareto improvements are possible.
H: Right. No adding or subtracting in that.
A: Exactly. But the Kaldor-Hicks criterion of efficiency sneaks interpersonal comparisons back in.
H: Then why would it be better than the maximizing calculus?
A: Well, the comparisons are less direct. The Kaldor-Hicks criterion broadens the simple notion of a Pareto improvement to allow, not just improvements to which no one objects, but ones that are so great to the beneficiaries that they can pay off the losers and still come out ahead.
H: It sounds as though we're also sneaking back to measuring preferences in terms of willingness to pay; or, in the case of the losers, willingness to accept compensation for their loss.
A: I'm afraid so. Interpersonal comparisons are back, though perhaps in a more limited way. Equal consideration is back out the door, because poor losers will tend to accept a pittance for their misery. And that's not even the worst of it.
H: It already looks like a pretty bad idea. It's hard to see how it could get worse.
A: Notice I said that the winners could pay off the losers.
H: Right?
A: Kaldor-Hicks does not say that they actually do that!
H: I'm stunned.
A: It's stunning, indeed. Kaldor-Hicks requires us to believe that justice is served when winners merely contemplate compensating the losers.
H: It's hard to believe that would sit well with the losers.
A: Or anyone with even a modest sense of justice.
H: Well, Mr. A, where does that leave us?
A brief synopsis
A: Not with much — at least, insofar as consequentialism and its incarnation as "natural capital" in valuing nature is concerned. Consequentialism in its various forms starts with one worthy insight — that the consequences of our actions and policies count in our moral assessment of them. Unfortunately, that insight is betrayed by the raft of assumptions that follow. There's the assumption that only consequences count. Close behind it is the assumption that the moral meaning of an act is entirely captured by how it affects human welfare. There's the flawed theory about how needs and preferences enter into human welfare. We have seen that it seems unlikely that we could make sense of comparing and adding interpersonal preferences. And it seems equally unlikely that we could find a just way to evaluate the aggregative consequences for welfare — whether we maximize utilities or apply an efficiency criterion. But even if we could do those things, questions about those first two basic assumptions would remain.
The grip of econo-consequentialist thinking
H: So how did such a problematic theory of moral value get such a grip on us?
A: I'm a philosopher, not a sociologist. But I'm willing to speculate...
H: that...?
A: ... there's a lure to the apparent mathematical precision of economics — so great a lure that we find it hard to overlook the possibility that the numbers may be meaningless. Economists aid and abet our urge to have a satisfyingly complete ordering on our choices. Of course we need the additional fiction of complete predictive ability and complete knowledge of human preferences for that. But nonetheless, the total ordering is hard to resist. All conflict dissolves away In a world in which all goods are completely ordered and comparable. There are no tradeoffs, really — just the choice that maximizes welfare for a maximizing consequential; or the most efficient choice for the modern economist. There's no tradeoff in choosing more welfare over less or more efficiency over less.
H: That would be too good to be true.
A: And I'm afraid it is. The unfortunate but real truth is that weighing the moral implications of an act is an extraordinarily imprecise and difficult practical art — not something that admits precise calculation. In the realm of natural value, part of the illusion of econo-consequentialist precision comes from its truncated account of that value as a set of resources and services from which we live. As we have already suggested, there's certainly more to natural value than that. Ethical considerations must embrace a wide variety of irreducible goods — not just how preferences are satisfied. Those goods tend to intertwine and conflict in agonizingly complex and difficult ways.
H: Yeah. I guess it's a mistake to try to make a simple thing out of something so complex.
A: Well said.
H: Do you think that there's anything else that makes econo-consequentialism seem so attractive?
A: Perhaps there's another attraction in how that view falls comfortably into the tradition of democratic liberalism. That tradition demands neutrality on the question of what we "should" prefer. We don't have to question one person's preference for a gigantic house over basic but entirely adequate shelter any more than another person's "preference" (or really need) for adequate drinking water. We take each preference at the same face value, as each person reports it to us. Even though we have seen that preferences are sometimes ill-conceived, to challenge such claims as less legitimate or illegitimate is vexingly difficult. Econo-consequentialism let's us avoid confronting this problem.
H: This has been an illuminating and most interesting discussion, Mr. A., but I don't think that I can cram more than one more thought into my head right now. Is there one final thought that you'd like to leave with us?
A: I've suggested that modern economic thinking has gone fairly far astray by failing to find and question some of its basic assumptions. That's not at all uncommon in ways of thinking that are institutionally ingrained. Nor is it uncommon for such ways of thinking to ignore obviously conflicting evidence. I'd like to bring one such case to your reader's attention — the problem with willingness to pay that I deferred 'til this point.
A final thought: Ignoring the evidence
H: Sure, shoot, Mr. A.
A: I have in mind the phenomenon of "protest zeros" in the contingent evaluation studies that economists use to find preference strengths for goods that are not traded in a market. These are answers that interviewees give as a way of refusing to assign any value to, say, preserving an area as wilderness. Economists quickly dismiss and throw out these "votes" on the grounds that they cannot be a true reflection of preferences: As they would say, "Nothing has either zero or infinite value." The evidence is discarded simply because it doesn't fit the theory. That, I would suggest, is as irrational as insisting that the premises "result of necessity" from the conclusion of a syllogism.
H: Pretty bad, I admit.
A: You should look at my discussion of bees. I honestly admitted that I didn't yet grasp all the facts and that
... if ever they are [sufficiently grasped], then credit must be given rather to observation than to theories, and to theories only if what they affirm agrees with the observed facts.
Aristotle, "On the Generation of Animals", Book III.10, tr. Arthur Platt (http://ebooks.adelaide.edu.au/a/aristotle/generation/complete.html)
Doesn't anyone read what I have to say about the proper role of evidence in theory?
H: I guess not nearly enough.
A: Unfortunately, in discarding these "protest" data, economists discard an invaluable clue about the nature of value.
H: What is that?
A: That some goods are such that no price is acceptable. Not that such goods are worth zero dollars. Or an infinite number of dollars. Rather, as we philosophers like to say, there is a category mistake. Stipulating a price is a social act, entirely appropriate as part of the social interaction for exchanging certain kinds of goods in a market, but entirely inappropriate as a way of conveying the true worth of others. To say that one is willing to pay for certain kinds of goods, or to say that one is willing to accept payment for certain kinds of harms is to fundamentally mischaracterize, and mis-categorize those goods and harms. Consider interhuman relationships. How much would you be willing to accept to sell your child into slavery?
H: Good grief, Mr. A! How could I even consider that?
A: Or how much to betray your best friend? We also think of certain environmental goods in this way, places and non-human beings with which we also have relationships. So you might not be willing to say how much you're willing to accept for...
H: ... paving over the rim of the Grand Canyon for a Walmart parking lot?
A: Aha; you catch on quickly.
H: And how about such things as the constitution that sustains the social organization of a polity; or the biophysical underpinnings of life on the planet? We looked at those in "A Benefit-Cost Analysis of the Bill of Rights... and beyond" (http://environmentalvalues.blogspot.com/2007/08/benefit-cost-analysis-of-bill-of-rights.html).
A: Yes, that was a wonderful piece of rhetoric.
H: It certainly felt like a category mistake to apply BCA to the fabric of society and then to life itself. But I think that you may have put your finger on the root cause of that category mistake. Categories such as costs and willingness to pay are not the ones that we use, or that even make sense to use in evaluating the sustaining and organizing principles of life and society.
A: You know, we have openings at the Lyceum for promising students such as yourself. And the tuition is a pittance next to Stanford's.
H: After hearing what you had to say today, I'm pretty sure that the difference in price is no indication of a difference in educational value.
A: You can be sure of that! And check out the new, Ethically Enlightened Environmental Economics course that we'll be offering.
H: I hope that's not an oxymoron.
A: We shall see.
H: Well, thank you again, Mr. A. We hope you can return to give us some better ways of thinking about value, particularly environmental value.
A: I'd be most pleased to do that. In fact, I'm off to begin preparing right now...
H: Ok, helioskiagrablog readers. There you have one more in our series of exclusive interviews. Aristotle, the philosopher with the theory of everything, thinks that natural capital is most definitely not the natural theory of natural value.
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