Government's Knowledge Problem


Reason Foundation Senior Analyst Shikha Dalmia recently posted a witty and provocative article suggesting that sometimes very smart people in government can produce really bad policy. This is not to suggest smart people are bad—quite the contrary. However, Dalmia points out that really intelligent policy makers are not exempt from making poor decisions. One of my favorite quotes from the article: 

But the bigger reason for this anti-intellectual animus is that every time really smart people run the country, things go spectacularly wrong … So why do intelligent people consistently make such a hash of things? Because they are smart enough to talk themselves into anything. Ordinary mortals don't engage in fancy mental gymnastics to reach conclusions that defy common sense. But intellectuals are particularly prone to this.

In response to this article, a friend of mine said: "Right because we all remember the disastrous administrations of Thomas Jefferson, Theodore Roosevelt, Abraham Lincoln, Franklin Roosevelt, and Dwight Eisenhower. God, I hate smart people!"

He makes a good point: in fact, we like smart people and they don't do everything wrong. However, the article did not intend to suggest we should not want smart people in government. Instead, the point of the article is to point out a problem with a particular kind of governing. Specifically, many very smart individuals, academics, policymakers, etc. often wrongly assume they have enough information (about the economy, details specific to environments, regions, people, industries, the list goes on) to adequately model behavior and enact plans centrally. For example, MIT hosted a panel on the federal budget deficit this week. Someone asked why the stimulus projections were incorrect. The panel professors, including Harvard's Greg Mankiw and Jeff Liebman, and MIT's Peter Diamond all admitted that either the baseline assumptions or growth projections or both were wrong. Nevertheless, few were apologetic for Washington imposing failed economic models on Americans. Often, very smart policymakers and academics overestimate their own abilities to anticipate how their policies will work in practice. Smart people are wonderful. However, individuals who overestimate their capacity to have adequate knowledge to plan for others also overestimate their ability to implement their ideas without negative externalities.

Indeed, smart individuals in government often are prone to this incorrect assumption that they have enough information to make plans for other people. It is not too much to ask that policymakers take a more humble approach and recognize what they do not know and what they cannot achieve in government.

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  1. Dwight Eisenhower? Wasn’t he stereotyped as the guy who would rather play golf instead of being that intellectual, Adlai Stevenson?

    But that’s the point, of course. Smart is good, but having the wisdom to know your limits and when to both trust other people (and trust the embodied wisdom of other people that is the market) can be more important.

    1. “Smart is good, but having the wisdom to know your limits and when to … trust other people … can be more important.”

      Sounds like a central part of the libertarian premise

    2. Did he play as many round as the current Retard-in-Chief?

  2. I think the problem can be summed up thusly: Smart people believe they know better than others and therefore are more prone to want to control others’ behavior. There have been smart people in history who haven’t bought into that fallacy, but not in modern-day government.

    1. Intelligence untempered by wisdom leads to banality.

  3. Thomas Jefferson – Acquired Louisiana Purchase, but also imposed a commerce-destroying embargo on trade with Europe.

    Theodore Roosevelt – Eugenist and warmonger.

    Abraham Lincoln – Under his watch, the U.S. became just about the only country requiring a war to get rid of slavery. Also: paper currency, violation of civil liberties, in general, federal centralization.

    Franklin Roosevelt – you got to be kidding!

    Dwight Eisenhower – smart, but stereotyped at the time as dumb by the folks who yammer about the need for smart people in politics. Also, perpetuated FDR’s abuses.

    1. Thomas Jefferson also praised the French Revolution as a battle for liberty. Lincoln did not anticipate secession or civil war.


      1. Lincoln knew there was going to be succession. And the French Revolution was a struggle for liberty. The ancien regime was horrible. It got what it deserved. The Revolution just went insane.

    2. Yeah my first thought was, are they trying to prove our point?

    3. Reagan – portrayed as a fool because he wanted everything reduced to a 3 x 5 card, but wise enough to understand that “government is not the solution to our problem, government is the problem”.

    4. Beat me to it.

  4. Ordinary mortals don’t engage in fancy mental gymnastics to reach conclusions that defy common sense. But intellectuals are particularly prone to this.


  5. There is a difference between being “smart” and being “wise”.

    Someone can become intelligent about a certain field just by studying the facts and data associated with said field. But wisdom comes from experience, and the most valuable experience comes from failure and trial and error.

    The supposedly “intelligent” brain trust that Obama surrounded himself with was in fact extremely intelligent, but not very wise.

    I would much rather the country be run by people with wisdom gained through experience than intelligence granted from collegiate accomplishment, or more simply as Buckley put it “I’d rather entrust the government of the United States to the first 400 people listed in the Boston telephone directory than to the faculty of Harvard University.”

    1. “There is a difference between being “smart” and being “wise”.”

      Yup, I saw this my first year in college. Some very brainy people doing some very very stupid things. It was a true revelation.

      I mentioned a variation of the Buckley proposal to a Ph.D at a recent meeting, who proceeded to chew my head off, and could not be made to understand that it’s not governments place to wipe every nose and kiss every boo-boo.

    2. Eh. Look at that MIT seminar example. If I, as a chemical engineer, were responsible for devising a model for some process that had similarly disastrous effects on a company’s finances, I’d be fired, hounded by lawyers, and never work in the industry again. (Also, we’d do scale-up testing, but that’s outside the scope of the analogy.) These guys applied an unproven model with admittedly wrong assumptions (we still don’t know what the right ones are, but theirs were wrong) and continue to host each other at conferences funded by the Feds. It’s fucking infuriating.

    3. I call it the difference between knowledge and intelligence. All it takes to have knowledge is a book to read and some time. Intelligence is something you have to work at. Knowledge lets you know what happened, intelligence lets you know why it happened.

  6. Many intellectuals are brilliamt and yet totally lacking in common sense. Is that so hard to grasp?
    Lenin was probably a genius but he could not tell right from wrong.

  7. Hey, it’s Ekins not obscured behind a Reason-Rupe survey! Welcome to the jungle…

  8. Every one of the presidents mentioned expanded the scope of government in massive and unprecedented ways (ways we all arguably benefit hugely from).

    1. Sure, you can argue anything.

      1. Everyone does in fact benefit from less freedom. After all, which has the healthier, more secure, longer life, the lion in the zoo, or the lion out on the African savannah?

        1. Which one paces, or starts pulling its own fur out, or does any number of things to indicate that it is slowly going insane?

        2. That has got to be a spoof.

          1. You would think so, but not necessarily. Tony really is that dumb.

            His ideal state for humans is to have them locked up in cages at the whim of his dream-lover Obama.

  9. It all goes back to Socrates–Wisdom consists in the awareness of ignorance.

    1. +1,000

      There are few wise people…and likely fewer who know what wisdom is.

  10. Lincoln wasn’t really a micromanager.

    He bitched at his generals, but there was no real content to his bitching besides “Attack! Would you fucking attack already?” It’s not like he was out there planning the Peninsula campaign or trying to do every brigade commander’s thinking for him (the way they say Johnson did).

    Lincoln’s expansion of government was impressive, but it didn’t really run up against the Hayekian information problem the same way that, say, FDR’s programs did. He centralized and expanded traditional government functions, but didn’t think to himself “I can run every farm, factory and general store in the country better than the guy doing it now” the way Roosevelt did.

    1. And his expansion of government related to the Civil War. The government shrunk back to a normal size after the war ended. Whenever I hear the “Lincoln ruined everything neo confederates” I always want to ask them “so you wouldn’t give your left nut to have the federal government return to the size it was in 1870?”

      1. The issue of not allowing states to secede has likely hurt human progress.

        Imagine if Texas and California both seceded in 1975. California would likely be in great shape by now as it failed and then was forced to emulate Texas’ obvious success.

  11. “So why do intelligent people consistently make such a hash of things? Because they are smart enough to talk themselves into anything.”

    I must wonder if people will ever find in themselves the ability to admit the obvious: Anyone who keeps making the same mistakes over and over and over — despite the clear lessons of even immediate history — is not smart at all. Plain and consistent inability to process basic information about the world marks impaired cognition.

    1. The problem is, it may be the same group doing it over and over again, but it’s constantly new individuals who think they have the magic touch to make it work. Even Obumah might get the hang of being an ok president after 20 or 30 years.

  12. A lot of smart people are really bad at starting and successfully maintaining businesses, too.

    All the book-learning, street smarts, and engineering prowess can’t cover the fact that government is basically overhead. Nobody became wealthy or even maintained his wealth by making it a point to expand overhead at the expense of everything else.

  13. To borrow the example of Steve Jobs from the next thread: he was brilliant, but he wasn’t “just” brilliant. He had something more that combined with his brilliance to produce amazing success.

    1. He carried out his own ideas about the best way to do things without checking around to see what all his competitors were doing.

      That’s a risk that wouldn’t have paid off if he hadn’t happened to have better judgement than his competitors.

  14. Lincoln was a tyrant with a lot of blood on his hands.. Smart or not.

    1. But his actions resulted in freedom for millions. Smart or not.

      1. The freed slaves? Only because it was politically expedient, otherwise, he did’t give a rat’s ass about their freedom.

        1. So results don’t matter? You have to do things with a pure heart? So what? He freed the slaves and the antebellum South will be forever remembered for that horrible institution.

          1. Fine, 10 points awarded for result of freed slaves, but the other 90 points were for how he got to that point, and what else it cost (short and long term).

            1. We got to that point because the South was a horrible corrupt slave owning culture. If the South hadn’t had slaves, there never would have been a civil war. If the South hadn’t had Jim Crow, there never would have been a civil rights act.

              The racist south, which is thankfully dead and gone, deserves the blame for nearly all of our long term problems.

              1. If the South hadn’t had Jim Crow

                You mean southern cities like Milwaukee? and Boston?

              2. Slavery was a function of the technology and economics of the time. The fact that it was (relatively) easy to see who was a slave based on skin color is a historical accident. It could have just have been all folks with red hair and a tendency to burn even on a cloudy day, had indentured servitude continued and morphed a just a wee bit.

                1. Slavery was race based. That is how people justified it to themselves. They were saving the heathen Negros from hell. That is what they thought. They would have never enslaved other white people.

                  1. Ask an 18thC Irishman or Scot how much legal status he had under the English.

                2. Slavery was a function of the technology and economics of the time.

                  Yes, it was entirely due to economics, had nothing to do with the notion that the black was primitive, “degraded”, malevolent, cunning, savage and childlike, without the firm, loving, and intelligent hand of the white man to guide him to docile tranquility in the fields and the house.

                  Some people just plain like ruling over others, with rationalizations either before or after.

              3. Because, of course, there were no slaves or racism in the wonderful, uncorruptable north? Many, including Lincoln, abhored slavery but still didn’t consider the slaves, asians, indians, or much of any non white to be equals. Slavery was a evil and hateful institution that was slowly dying in most “civilized” countries just as it was here. However, the South had become so economically dependent on it so there was a vested interested in putting on the blinders and believing that the slaves were no better than beasts of burden. I personally believe that mechanization and morality would ultimately have doomed slavery even without the war. Sadly, one of the things that helped perpetuate Jim Crow was the death of Lincoln. He favored reconciliation in an effort to move forward as a single nation and after his death, punishment of the South became the order of the day. This just helped ingrain the prejudices and race hatred and made it that much harder to overcome. My point is that while the South certainly deserves it’s share of blame for our troubles then and now, political wrangling and well meaning attempts at limiting it’s influence contributed as well.

              4. You do realize that the Southern economy was based on cheap labor at the time and the Northern economy was not?

                Imagine if the South was the predominant power and it said: you can’t have factories to the North.

                Slavery should have been dealt with at the founding of the country; it wasn’t, for many substantial reasons.

                By the Civil War, it was past time for it to go, but it’s a drastic simplification to say that the South was completely wrong and the whole war was all about slavery.

            2. Fine, 10 points awarded for result of freed slaves, but the other 90 points were for how he got to that point, and what else it cost (short and long term).

              Could have just done the smart thing and waited Lincoln out.

      2. But his actions resulted in enslavement for all Americans. Smart or not.

        1. Silly hyperbole is silly.

  15. NAL is exactly right. Smart and “selfish” are two different animals. One can be smart and have their individual values sorted perfectly, yet be markedly ignorant on the preferences of others. In fact, even trying to guess the preferences of others is intrinsically ignorant. Only one man needs be quoted here…William Wallace said it best: “FREEDOM!!!!!!!!!”

  16. Someone asked why the stimulus projections were incorrect. The panel professors, including Harvard’s Greg Mankiw and Jeff Liebman, and MIT’s Peter Diamond all admitted that either the baseline assumptions or growth projections or both were wrong.



    Right in this casino?

    1. “Someone asked why the stimulus projections were incorrect..”

      Because the people making the projections would suffer no personal sanction for being wrong ?

  17. Many of the smart people who go into politics have backgrounds in economics, law, or political science.

    For the most part, you can make your own rules in these areas. Economists model the economic system, but the economists are the ones making the rules the model follows. The only way to test how good the model is is to implement it in reality. Only then, do they find out that their model fails and they’ve made false assumptions.

    In my mind, law and political science are much the same. The people working in those fields are the same people who are making the rules. Congress makes a law with a certain purpose in mind, and then reality takes it and exposes all of its weaknesses.

    The juxtaposition would be a field such as physics, where the physicist doesn’t have any say in the rules, he’s just trying to figure out what they are. Economics should be viewed in the same way, but that’s not how it’s taught.

    (TLDR) The “smart” people in politics come from fields where the theories aren’t testable until they’re actually applied in reality. As a result, they spend their education simulating their theories with false assumptions – but they’re never educated on what those false assumptions might be. Reality quickly exposes the weaknesses in their theory. Some people will take that as a clue that they don’t know as much as they think they do. Others will take a Procrustean view and try to make reality fit their model instead of vice versa – hence trying to control the way people live their lives.

    1. The problem with that theory is that lots of really smart scientists have really stupid political views. If scientists make better political leaders, explain our current Nobel Prize winning energy secretary.

      1. That wasn’t exactly what I was trying to say. China’s a good example. Most of their leaders having an engineering background.

        But, scientists are constantly being put in a situation where they can see how they perceive the world isn’t how the world actually works. “Oh gee, my hypothesis is wrong.”

        People in many other fields of study can make an argument for anything they want, and there’s no way to prove them wrong until that argument turns into policy.

        So, I wasn’t saying that scientists would make better political leaders, just that many our current political leaders come from a background where reality doesn’t often challenge their perception of the way things work.

        1. The problem is that scientists only change their views of the areas they work. When it comes to politics and economics, they are just as prone to the type of behavior you describe as anyone else.

        2. The Chinese are also not above using a failed politician as a heart transplant donor.

          …sort of gives a guy a reason not to f*ck up.

  18. That smart-talkin’ friend of yours is certifiably dumb, Reason person. Every one of that list of presidents, even Jefferson, was denounced as an ape-skulled hick by all his right-thinking, better-bred, analogous-to-people-who-call-themselves-“smart”-now contemporaries. I’ll just pick one from the list, because I don’t want to write a book here, and because it’s, like, ironic:

    The Eisenhower’s-retarded campaign/culture/meme/theme of his time (which (theme) was really only based on Ike’s not being properly, fully Northeastern; the guy was approximately a genius, but…Texas!) is in fact the historic fount of the particular style of Republicans-R-Dum dumbness that the smart have kept us ever since?and that generated this particular H&R back-and-not-forth.

    Ike’s most-cited (then and now) proto-Palin moment was his saying probably the most intelligent thing any president has ever said: “Things are more like they are now than they ever were before.” Too subtle, I guess? Like Rumsfeld’s “known knowns” remedial epistemology lesson, which was totally LOL, because WUT?

    It was Ike’s idiocy?not his policy, which was pretty much indistinguishable from his “smart” predecessor and successor?that necessitated, in its wake, the taking over of American politics by students. From school. Which is the opposite of Texas.

    So, the ’60s. Brought to you by IKE = DUM. That’s how big it was.

    1. They called the White House the “Tomb of the Well Known Soldier” during his time. Of course as you say Ike was anything but stupid. And unlike his successor, JFK, who damn near destroyed the world during the Cuban missile crisis, IKE got the country through the worst parts of the Cold War and instituted the first steps towards Detente.

      1. JFK made the career enhancing move of dying young. The myth of Camelot persists to this day, to our national detriment (and my nausea). Every Dem wants to be seen as the next incarnation of the smart, good looking, glamorous JFK. In fact the talk of how glamorous Michelle Obama is seemed, to me at least, willful blindness to reality.

        1. I always thought the Michelle Jacki Kennedy talk was outright patronizing racism. Michelle Obama is an average looking middle aged mom. She is not ugly by any means. But there is nothing glamorous about her. They never called Laura Bush, another reasonably attractive but unglamorous middle aged mom, glamorous. They only called Michelle that because she is black and they were desperately trying to compensate. To me the media comparing Michelle Obama to Jacki Kennedy is like telling the down’s kid what a great basketball player he is after he hits a free throw.

          1. She’s not ugly on the outside, but inside is a different matter.

  19. Add one “with,” above, please, quirrels.

  20. “Right because we all remember the disastrous administrations of Thomas Jefferson, Theodore Roosevelt, Abraham Lincoln, Franklin Roosevelt, and Dwight Eisenhower. God, I hate smart people!”

    In their times Lincoln and Eisenhower were not considered the intellectual choice for President (not to say they were dumb, but Douglas and Stevenson were popularly perceived as the intellectual superior choices). Part of the problem here is that whether you accept certain controversial precepts right now are markers to whether a politician is considered intelligent. Under this, left wing politicians operate under the assuption that they are intellectual giants by the punditocracy. Part of this is also supported by the fact that the Right at this point is not necessarily impressed by academic creditionals as a measure of intelligence as the Left is.

    1. The left has sold itself as a brand. It is just what smart enlightened people believe rather than all those unwashed masses. It some ways it has been very successful for doing this. The “brand” culminated with the election of Obama, a candidate who stood for nothing really other than being smart and cool and who right thinking people support. The problem is that by becoming a brand, the Left is killing itself intellectually. If you are a brand, it is pretty hard to have new ideas or incorporate or co-opt the ideas of your opponents. You are stuck thinking one thing that is the brand and what everyone else thinks.

  21. Shika’s article suggests an epiphany-

    Tax The Reich- punitive taxation of government employees could deter government growth .

    Crime should not pay , and imposing sin taxes on turf building and the propensity to regulate on the perps might work if their salaries were taxed at rates indexed to the size of bureaucracies and deficits .

    Providing bureaucrats with refunds and bonuses only if and when they shrink their operations would drive talent into the private sector, leaving only the worst and dullest would slouch to the public trough.

    The most draconian way to intellectually defund the left is to face wannabe solons bent on bloating the federal code with taxes of the sort the Labor Party imposed on postwar plutocrats.

    When Supergrade feds see their take home pay docked with every uptick of the national debt, communitarians busybodies will think twice about careers in government .

    1. Just to complete the circle: We should also have a surtax on the surplus earnings former government employees make after they leave the fold. They’re trading on their government experience and access, after all; qua Elizabeth Warren, they should be taxed on it. Good and hard.

      1. I think Instapundit’s recommended rate on this is 50%. I believe that’s 50% of the difference between what they earned as a govt employee and what they earn after.

        1. That’s who I stole it from.

  22. It’s not so much just smart people but smart people who think there aren’t any other smart people in the world with them.

    How many times do you see someone comment on a current problem and say “why doesn’t X just do Y?” As if no one else has thought along the same lines. It doesn’t occur to them that there may be good reasons why things are the way they are. There is just the assumption that the people handling the situation are stupid or irrational.

    When you combine this with a coercive system with little accountability like the government it makes for a toxic mix.

    1. Although to be honest, sometimes X doesn’t do Y because “there’s no way that could work”. Sometimes intelligent people over-think a problem so much they miss the simple solution sitting right in front of them.

      1. Definitely true. It’s a problem I have from time to time myself.

        I think your example also further illustrates the idea that no one else is as smart as they are and reject “simple” solutions mostly because it didn’t occur to them. Because of course “everyone else is stupid or irrational.”

      2. Hmm, government as Rube-Goldberg machine… I like it.

      3. Which is why the only way that works is to let different people try different ideas out. And sometimes fail.

    2. “why doesn’t X just do Y?”

      Sort of like telling the petroleum engineers to just “plug the damn hole”.

      Well yes…we never thought of THAT.

  23. Basically this says smart people think they are smarter than they really are. That’s not very smart.

    1. There was some research published recently which showed that truly smart people know their limits while not-quite-smart people overestimated theirs. Basically, truly smart people know when they don’t know something and are smart enough to not try to fake it. Not-quite-smart people, believing they are smarter than they really are, don’t realize they’ve gone beyond their ability and just start winging it as things go downhill.

      1. Whereas we really do have all the answers.

        1. Don’t mistake me for someone pretending to be a Libertarian or thinking I have all the answers. I’m smart enough to know that I don’t.

        2. Whereas we really do have all the answers.

          Quite the opposite. We know that nobody has the right answer for everybody, every time.

        3. Libertarians don’t have all the answers. They’re just good and recognizing the obviously wrong answers.

          1. They’re just good and at recognizing the obviously wrong answers.

      2. OK, it’s not as recent as I thought.

        Dunning-Kruger effect

      3. “Not-quite-smart people, believing they are smarter than they really are, don’t realize they’ve gone beyond their ability and just start winging it as things go downhill.”

        Politicians lauded as intellectuals are usually the not quite so smart people, the truly smart do more productive things with their lives.

  24. Top. Men.

  25. One thing that many of the most destructive and incompetent presidents have in common is an adult life entirely devoted to government and/or public policy. I give Ike a bit of a pass on that because his government experience was, shall we say, a bit more “hands-on”. Carter is possibly a counter-example, since he had farming experience.

    It gets worse at the Harvard Wonk level because those folks seem to have even less practical experience than the person who works their way up from the local school board.

    I would prefer that national politics not be a career at all, but a temporary calling.

  26. The problem is not there’s too many ‘smart’ people in government.It’s the fact that they belive everyone needs to live as they say.The beauty of the constitution is it placed limits on the amount of control over peoples lives.Now when your entire life has been in government you look for ways to expand your reach and influnce.Just like a business looking for market share,except the rulers have no moral hazard when their ideas fail .They don’t pay for their mistakes.

    1. Should be possible to put much bigger “pay for their mistakes” feedback loops into government. Much, much bigger.

  27. “It is not too much to ask that policymakers take a more humble approach and recognize what they do not know and what they cannot achieve in government.”

    Paging Gary Johnson.

  28. Critics of libertarianism often misunderstand and think that libertarians don’t believe that the same thing goes on in the private sector.

    I can give you story after story about the stupid, overconfident decisions made at the places where I have worked. The only difference is a few of those places aren’t even around anymore because of it.

    1. Yep. Poor allocation of resources in the private sector equals failure. In government, this is known as Tuesday.

  29. By the way,I’ve have always wished everyone in the country could spend at least 1 year being selfemployed.Paying all your taxes,rent,utilities,permits,ect really shows how wealth is created and how no one person or group can have all the answers.

    1. can’t that is

  30. Stupid is as stupid does…..

  31. If I may summarize (four days late):

    The problem with smart people is that they aren’t nearly as smart as they think they are.

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