Happiness & Public Policy

The politics of happiness research just got a bit more interesting. British Conservative leader David Cameron is now campaigning on a happiness platform. In a speech at a conference organized by Google in Hertfordshire, Cameron said,

It’s time we admitted that there’s more to life than money, and it’s time we focused not just on GDP, but on GWB—General Well-Being.

This is interesting because up until now, the politics of “well-being” have been primarily a welfare-liberal or social democratic phenomenon. So why the happiness schtick for the Tories? Why now? The Financial Times editorial page says:

Mr Cameron’s call for the Tories to address GWB is not a coded cry for redistribution. After green issues and childcare it is another sensible step towards increasing the opposition party’s appeal by redefining popular values in modern Britain. From the Thatcher era onwards, the Conservatives have faced the charge of being cold and uncaring. Mr Cameron’s task is, in part, to persuade voters that the Tories are warm and cuddly.

Although there is much support in the happiness literature for proposals to allow individuals greater control over our lives, I worry that creating a climate hospitable to risk-taking, entrepreneurship, and greater personal control (and, necessarily, greater personal responsibility) may be perceived as bracing, but not so much as “warm and cuddly.” In his talk, Cameron dilated on the wonders of Howies, a “socially conscious” Welsh company in the mold of the US’s American Apparel, praising their lack of hierarchy and the flexibility in work arrangements.

Now, greater work flexibility is great, and that’s a big part of what it would mean policy-wise to enhance well-being by giving people more control over their lives. But what does Cameron have in mind? Is this anything more than emotionally appealing talk? If so, genuine work flexibility requires deregulating the labor market, allowing individuals to bargain terms of employment for themselves, rather than getting stuck with the terms their union (which workers in certain areas often have little choice but to join) negotiated, or with terms set by the government, independent of the desires of the parties to the agreement. A system in which a certain wage, a certain package of benefits, certain labor conditions, etc., are mandated by the government is a system in which it is harder for people to opt in and out of the labor market, or to negotiate flexible contracts that uniquely suit their individual and family needs. There is a lot to be said in favor of companies that create a hospitable, flexible climate for their employees. But as the FT editorialist points out:

Not every employer can introduce flexible work practices and not every job carries high satisfaction levels. To behave as though this were possible could invite cause for dissatisfaction.

If Cameron seeks to mandate Howie’s-like flexible work practices, rather than removing existing labor market interference from unions and government, he will end up reducing real flexibility for workers. Furthermore, as UCLA law professor Stephen Bainbridge points out, not every worker wants a non-hierarchical work environment. Not everyone likes being saddled with participation in management decisions in addition to their regular work. Companies should certainly be encouraged to create work environments that inspire loyalty and productivity from their workers—and good returns for their shareholders. And if you’re a consumer for whom the production process is part of what you’re buying, you should feel free to patronize businesses that reflect your values. But mandating flexibility, or a particular “work-life balance,” won’t deliver it. The heirs of Thatcher should know this, and it is sad if they think thay have to act like they don’t. We’ll see.

In defense of GDP, it is worth pointing out that focus on the size of the economy does not imply the state’s endorsement of a narrow-minded, acquisitive ethos. Wealth is not a morally questionable, or even a morally neutral, end. It is easy for people to imagine that the size of the economy grows magically, due to some incomprehensible ju ju down in the basement at Google Labs or something. But it’s not magic; it’s virtue. The economy grows primarily because innovations in knowledge enable us to produce more, and therefore to offer more, to others in cooperative exchange. GDP growth is the steady increase in the size of the surplus from human cooperation. Extended, peaceful, increasingly effective human cooperation is not an easy thing to sustain, and the institutions, and the habits of heart and mind, that do sustain it are moral triumphs. As Deidre McClosky draws out in the brand new Cato Policy Report :

“Modern economic growth,” as the economists boringly call the fact of real income per person growing at a “mere” 1.5 percent per year for 200 years, to achieve a rise in per capita income by a factor of 19 in the countries that most enthusiastically embraced capitalism, is certainly the largest change in the human condition since the ninth millennium BC. It ranks with the first domestications of plants and animals and the building of the first towns. Possibly, modern economic growth is as large and important an event in human history as the sudden perfection of language, in Africa around 80,000 to 50,000 BC. In a mere 200 years our bourgeois capitalism has domesticated the world and made it, from Chicago to Shanghai, into a single, throbbing city.

There has been no force in history that has done more to promote “general well-being” than economic growth. There is no force that will do more good in the foreseeable future. I hope that Cameron takes note that in cross-national econometric studies the only variable that correlates with reported well-being more strongly than GDP per capita is a society’s degree of economic freedom.

There is a politics of limited government and personal repsonsibility lurking in the happiness data. If Cameron is going to run on happiness, let’s hope he is able to find it, and allay Frank Furedi’s worries, and mine, about an illiberal, infantalizing therapeutic state.

[Cross-posted from Cato@Liberty.]