Stuck with choice

I had a plan for today’s post, which was to go back through this blog to find where I had used various news stories to make a point and to revisit those stories asking: what happened next? As I began to do so, I found that it was a completely overwhelming task. Over the last three years I have written about under-employment, corporate tax avoidance, outsourcing, immigration and refugees, global supply chains, public sector reform, economic insecurity, pensions, corporate takeovers, air crashes, the NHS, the Greek crisis, the British establishment, the war in Ukraine, the Chinese economy and many, many other things.

So I have given up on that idea (for now) and instead will return to just a couple of things I’ve written about which are in the news again. In my post More on Power (November 2013) I wrote about the ludicrousness of consumer choice in the electricity ‘market’. Wind forward to today, and the price comparison sites that would supposedly enable such a choice are mired in scandal. In my post Pensions (March 2014) I wrote about the deregulation of personal pensions, a reform supposedly freeing up pensioners to make choices about their pension pots. Wind forward and we find that already scandals are emerging as pensioners are ripped-off or conned into making dangerous investments.

The fallacy that links both these cases (and another current story, that of the need to shop around for the best bank account) is that consumer choice is both efficient and morally impregnable. It is a logic in which corporations and consumer rights associations are complicit (see also my post on The Benefits of Work in July 2015). Choice isn’t an unqualified good.

Of course the neo-liberals are right when they point to the absence of choice as being one of the failings of State Communism. But that Cold War rhetoric doesn’t take us very far because the issue isn’t ‘no choice’ versus ‘unlimited choice’: there are degrees in between. Moreover, as these various examples show, choice in many markets is fairly meaningless. I sometimes think that market ideologues genuinely believe that ‘the market’ always and everywhere has the same form as wandering around fruit and veg stalls, looking at the quality and price of produce before buying. If so, it’s wholly unrealistic.

The reality across huge swathes of products – not just energy, pensions or bank accounts but also mobile phones, insurance or university courses – is nothing like the Economics 101 textbooks. It’s all but impossible to compare products and prices, and even if you did so once then within a few days or even minutes things would change again. Choice in these circumstances is meaningless, and the constant invocation of choice as a cardinal value is in fact an attempt to make as central the idea that we are all ‘choosers’. And the significance of that is not that it is a good thing to be a chooser, but that if choosers make the wrong choice – as some or many will - then they have only themselves to blame.

Writ large, this means that whatever happens to anyone, good or bad, is to their own credit or reflects their own fault. And so any social situation, no matter how unfair or wrong it may be, is not just unavoidable but, actually, right. This grotesque moral spoonerism is the ultimate consequence of the benign or even positive spin put upon choice.

In political philosophy, the most sophisticated expression of this valorization of choice as central is to be found in Robert Nozick’s book Anarchy, State and Utopia (1974). It is a beautifully written and intellectually elegant book that I would recommend to anyone. At its heart (as regards choice) is the ‘Wilt Chamberlain example’ (Chamberlain being a famous basketball player). Nozick argues that if before Chamberlain plays a game everyone agrees that the distribution of income in society is fair (even, say, if it is equal); and if, then, everyone who pays to watch Chamberlain play does so as a free choice; and if, then, as a result Chamberlain has more money than everyone else; then that new unequal distribution of income must also be fair, as everyone has chosen it.

There are two flaws in this argument. One is that it is only Chamberlain and those who paid to see him who have consented to the new income distribution. What about everyone else? If consent is the key principle for fairness then how can it be fair when they haven't consented? The other is that if Chamberlain and everyone who paid to see him had known that his extra income was to be taxed at 100% and redistributed, and he had still chosen to play and they had still chosen to pay, then the resultant equal income distribution would also be fair, on the logic of choice.

So choice doesn’t work, even at the most sophisticated theoretical level, as a guarantor of fairness, and it doesn’t work at the demonstrable empirical level of how choice actually works in markets. Which doesn’t mean that it is of no importance if people don’t have choices. On the contrary, choice is vital for both economic and political well-being. It’s just that it is not the only thing that matters, or the thing that matters above all else. It's not a kind of trump card that beats every other aspect of human existence.