Sunday, July 12, 2009

Unexpected Consequences

Unexpected Consequences are serious bi-products of decisions made that are not only unexpected but in many cases tied unseeingly to those decisions. In other words its hard to link those consequences to the decision and thus easier to make more bad decisions. If politicians create these consequences but the public does not see the link... they are not more likely to vote him or her out of office.

One of the most common argument made by people who favor bailouts for individuals that are going to lose their home if government (meaning tax payer) does not pitch in and help is that their loss will cause property values to dwindle and thus it is to your benefit that we bail those people out who made bad decisions. So in practical use it looks like this: You rent an apartment because you believed that you did not have the money to buy your dream house thus conserving for your future. However someone your age in the same situation does buy that house and come to find out they cannot afford that house so the government wants to use your tax dollars to help that person so that it does not hurt your property value in the future. This probably now seems immoral to be put that way but beyond that it also creates unintended consequences. In the future more people will make dumb decisions because they A) feel cheated to have had to bail out the person the last time this happened and B) I know if I can't afford it there is a good chance government will bail me out this time. Therefore the amount of people making bad decisions rises. This once shorterm problem is now gigantic and affects many million in the country. We are currently going through this in our present day economy. If no bailout in the first place... probably better decision making in the future by all people.

The other day there was two police chases that ended in car crashes in which people were severely injured and taken to the hospital. There was some news stations debating whether police should even pursue such thieves since they can result in other people being hurt on the highways due to these high speed chases. That is ridiculous on surface but lets look at the unintended consequences that could be caused by this. If a thief knows he or she will not be pursued after a hit and run or stealing a vehicle or committing some other crime then more theives will be willing to go into this practice as the chances of them getting away with it grows. What I would recommend is that if a person commits a crime like this they should take him or her out as soon as possible. yes there is a chance that the criminal might be hurt and possibly an innocent bystander although less likely than when the chase has reached well over a hundred mph. However if a criminal knows that within minutes of being pursued they are going to be taken out automatically.. they are probably going to be fewer criminals in the future taking those risks.

There are many many more examples that I have mentioned in past posts. I also recommend reading some of Thomas Sowell's writings on this. But remember costs are not just present. Costs of decisions made by politicians and individuals grow in the future if they create unintended consequences even if those consequences are unforeseen

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