The Nature of Tastes and Values

Are our tastes subjective?

Is chocolate better than vanilla? Are apples better than oranges? Is spending time in front of the TV better than reading a book? Is poetry better than push pins?

The average Westerner likely believes he has an opinion, but that there is not a lot to it. For whatever reason, whatever cosmic forces of nature and nurture have intersected in his life, oranges are preferable to apples in his own mind. That preference just is.

The minority opinion, one that often appears stifling, callous, and abrasive, is that there is an objective truth to chocolate or vanilla. It bequeaths such a negative aura because, on its face, its auspices are of an arrogant, juvenile dismissal of a perfectly reasonable taste. This opinion is associated very much with “I don’t like vanilla because it’s stupid.” Such an argument does not inspire the trust of anyone but the easily bullied.

The path much less followed is somewhere in between. The definition of “subjective” is the problem. Concurrently, “subjective” may appear to mean both “different across people” and “arbitrary and meaningless”. The two definitions are often used interchangeably, and some may accidentally use arguments in favor of the “different across people” explanation of tastes to argue for “arbitrary and meaningless”. One may suggest that since one of the factors whereby we may enjoy good is nostalgia, and nostalgia is entirely dependent on an arbitrary set of experience, that taste in turn is arbitrary.

This argument only makes sense if you assume that subjective and objective are antonyms. Can we not say that the person who feels nostalgia feels something that is objectively true and real? That taste – effectively the chosen value of vanilla over chocolate – is something both rational and meaningful.

Stairs are only useful for people who are not confined to wheelchairs. At the same time, that does not mean stairs are only useful for society because people choose to desire stairs for no apparent reason. Ultimately, values are subjective across people and the innate differences people have are not at all subjective within the choices people make. Goods effectively “choose” the consumers. The consumers have little say in the arbitrary happenstance of their life. However, the wheelchair accessible ramp was able to provide value to the “taste” of the wheelchair-bound because the supplier of the ramp allowed it to, not because the presumably non-masochist wheelchair-user decided to use it over partaking in a Sisyphean journey up the stairs.

To take it one step further, who is to say that each of these bits and pieces of nostalgia and random occurrences of life (such as needing a wheelchair) are all the matters? Why can’t these factors be the noise that must be separated from some underlying signal? Most would agree that their distaste in dog feces is not based on their arbitrary experience in life. Chocolate ice cream, on some level, is truly “better” to eat than feces. It would take an especially strong “taste” in anthropological relativism to propose an alternative scenario, wherein one can seriously prefer dog feces. Can’t it be that there is an underlying truth to the usefulness and taste of chocolate over vanilla, or vice-versa, but that there is too much noise across individuals to figure that out? Perhaps the contrived anthropological hypothetical of some society or individual enjoying eating feces over chocolate is demonstrative of the extreme amount of noise required to cancel out the signal and truth of feces being a really bad thing to eat.

A difference in a taste for chocolate, vanilla, strawberry, blueberry, raspberry, or the myriad alternative desert flavors may be a simple random confluence of factors which caused you to choose one over another. It certainly is difficult to put words to that reasoning, and when people try to, it usually comes out as “blueberry sucks” rather than something someone can reasonably disagree with. It is virtually impossible to define. Going past such haphazardly defined taste, most of us are willing to accept the notion that Star Wars is a better movie than Gigli. Among aficionados, there is a general accepted continuum of the best movies, good movies, fair movies, and awful movies. There is the occasional, though infrequent, strong disagreement among experts, but tastes are by and large remarkably similar. It is true that certain times, the general audience disagrees with these experts, but in the long run, experts are either forced to come to terms with a demonstratively overlooked movie, or more often, the general audience allows a popular film to sift into obscurity. Each of these scenarios is consistent with the notion that the underlying values are difficult to discern yet there is still an underlying truth to the matter.

Take this another step forward, to the arena of religion, philosophy, and public policy. Socialism, wicca, agnosticim, intelligent design, affirmative action, analytical psychology, and whatever else you want to throw in there have zealous supporters and arguments their own. These are the “tastes” for which we can actually come up with rational arguments. It’s not nearly as simple to construct an argument in favor or blueberries as a dessert topping as it is to construct one against intelligent design. This does not mean that intelligent design is wrong, but one can state a reasoning against it.

Our tastes, and truly, our values, are neither subjective within individuals or undeniably true. They are indefinite. Knowing this, the only option is to understand our background, whether that be as a liberal, suburban Westerner, a Conservative Middle American, a Muslim, a Socialist Central American, or anything else, has partially induced our tastes and values, and that backdrop only serves to bias us against the underlying truth. Unintuitively, even a complete rejection of our background biases us in the opposite direction, as some of the truths taught by our background, or even all of them, may be real. It is a moral imperative to figure out what value is right, fairly weighed against others, before we start fighting for it.

The popular philosophical definition of both “subjective” and “objective” is wrong. They are not opposites. They do not defy each other. True subjectiveness lies in random tastes and experiences life has dropped on us, all of which is inexorably real. I only enjoy the mediocrities of failed comedies such as Dirty Work and Mafia! because I discovered them in my early teens, the breeding ground for nostalgia. True objectivity exists, but may only hope to begin when one is willing to rend one’s vestments of happenstance, genetics, and experience down past the clothing and to the naked, bare-boned truth, if I may complete such an atrocious metaphor. While it may be beyond humanity’s communicative power to elucidate the utility of strawberry ice cream over chocolate ice cream, we can perhaps hope to reach the day where we can inconvertibly argue for mixed market economies over planned economies, or vice-versa.

Money is a Symbol

To paraphrase certain right-wing social conservatives, money is not evil; people are.

The world would be far worse if money did not exist. Look around you, at any of the goods you own or consume. This may include comparably hedonistic products such as DVDs, a TV, or a few hundred pairs of shoes. It is also includes water, the roof over your head, medical care, food, and water. From the supply side, those are completely equivalent. You would not have been guaranteed those necessities were it not for money, and the existence of DVDs, a TV, and hundreds of pairs of shoes for anyone besides the super rich is ludicrous without a simple means of commerce.

Morally there are many apprehensions associated with a love of money, because it is implied that the love in question is that of obtaining more money. That idea, the notion of increased material wealth, only interests me moderately. However, I LOVE the idea and usage of money within our economy.

If we each concentrate on what we do best, we are inexorably better off than if we all attempted to do every task ourselves. You personally may possess the instinct and innate tools required to figure out what’s wrong with your car, how to plan your wedding, or how to invest your money, but most people are not. We can take advantage of the specialties of each individual and leverage them by trade.

In an ancient economy, there was a small number of goods available, so it wasn’t unreasonable for the farmer to trade a certain number of figs for a new tool or something else. Trading still became difficult quickly since those figs weren’t going to keep forever, and the farmer may not desire to purchase that new tool until next spring, even if the current excess harvest will spoil by then. He could try to come up with an agreement with the guy who is good at making tools, but that’s inconvenient. You can see historically that once people exit a communal economy, the idea of a universal bartering vehicle is very attractive. Monetary systems were born pretty quickly in human history. Without money, how would the producer of high definition TVs pay his employees? With high definition TVs? That would hardly seem efficient, even setting aside the awkwardness caused by the modern fig grower attempting to pay for high definition TVs with figs. What if the two producers of high definition TVs in the market don’t really like figs? These are things you can get around, absolutely, but they are at the same time issues that can be sidestepped by introducing an abstract numerical value to all possible goods in the economy.

What is money? It is that facilitation allowing the farmer of figs to sell them for not some pre-specified, discrete good, but any combination of goods in the economy to be determined at a later date. To speak technically, it is a claim check for the services and goods provided by society. Money is a symbol of that.

Casual pseudo-intellectuals, a group to which I self-consciously say I belong, often claim that ownership of money is evil or if they get especially rambunctious, that money is evil. Some left-leaning Christians may postulate that Jesus said money is evil, although that little tidbit of apocrypha is not only patently false, but what was actually said is something I entirely agree with.

Money is power and the desire for power, or money, is corrupting and evil.

Thus, if you make a big fuss over money being evil, you should realize that you’re making the several-millennial old statement on the corrupting tendency of power, something that we were all made firmly aware of when we were nine years old or so. If you’re spouting such “truisms” to justify the elimination of any form of money from society, you have absolutely no idea what you are talking about, unless, of course, your goal is to set back the state of global welfare by about 3,000 years.

A tangentially similar notion that is far more commonly accepted is the appropriation of GDP, GNP, or PPP as an unquestioned proxy for welfare in the economy. Just as claiming that power is evil implies money is evil is fallacious, suggesting changes in GDP are demonstrative of a negative effect on welfare is disputable. The extreme example is the air we breathe. It is not included in any GDP calculation, but that does not mean that it is valueless. If something happens to our oxygen supply that causes half the population dies off, that would actually increase GDP per capita since the capital in place would be spread over a fewer number of people, but would anyone suggest that total welfare has increased? In truth, GDP only counts stuff that is scarce enough that we need people to sell it and that we can aggregate and calculate its sale. There are plenty of other things not in that number.

As Pope Benedict XVI said,

History is marked by the conflict between love and the inability to love, that desolation of souls that occurs when man is capable of recognizing only the quantifiable values as valuable and real.

This isn’t some rant against imaginary foes; people do really make these arguments. In a recent Pop-Econ book for which I cannot decipher the source, either The Undercover Economist by Harfod or More Sex is Safer Sex by Landsburg, this very problem is pointed out in the scope of environmental concerns. Some right-winged pundits insisted that we should never take action against pollution because it would hurt GDP. Whichever author it was correctly pointed out the ridiculousness of the argument. Yes, it would hurt our economic welfare on paper, but not necessarily our real welfare in life. The argument confused the symbol with the truth.

Please keep in mind the ambiguity the word “money” truly suggests. It can mean the physical paper. It can mean the theoretical number of dollars in the money supply. It can mean welfare. It can be power. It can be the concept of trade. Don’t fall into the trap of harping on the concept of one of these to attack the other.

A Fallacy of Economic Externalities

See here for background.

According to most political moderates, a just function of government is to serve certain functions that will maximize the greatest good for the greatest number. For certain questions, it’s possible that if we are all pay $1 into a hypothetical pot, we may all receive back $2, but only if we are actually are forced to do so, requiring government intervention. These dollars only represent our total materialistic happiness -our economic utility- and not literal money. There is an entire branch of economics devoted to finding ways to increase utility for the entire economy.

In ideal circumstances, prices reflect all costs to society. This means that if a pencil costs $0.30, it cost the rest of society $0.30 to provide that pencil to you, the potential buyer. If the pencil is worth more than $0.30 to you, you will buy it. This mechanism means that whenever trade happens, given that you will do the best of your ability to spend your income on what means the most to you, trade is good for everyone. In fact, if prices perfectly reflected the cost to society, resources would be allocated in such a way that everyone is the best they could possibly be given their income level. There would be noise involved when people don’t really know what is best for them, such as in the case of addiction to drugs, but that is beyond the scope of this question.

However, there are certain times when prices do not match the cost imposed on the rest of society. For instance, if a factory owner dumps chemicals into a river passing by, a cost that society has to deal with (a river that is less useful because it is contaminated or bearing the cost elsewhere to clean it up) is not reflected in the price charged for the good. If the industry producing this good all the sudden had to bear the cost, certain firms on the margin would be forced to shut down. Other firms would likely produce less and at a higher cost. This would not be undesirable, nonetheless. Individual purchasers of each good were not communicated all the information they needed. They did not understand with their wallets that part of the cost of producing this good was causing that pollution. The economy therefore, in free market conditions, devote too many resources for this good at the expense of others. That is to say, the labor, raw materials, and other inputs in manufacturing the good would have provided greater total utility if they were to be dedicated towards other ends. This is known as a negative externality.

Conversely, other goods may be underallocated, meaning we produce too few of them at too low of a price. Abstractly, this is analogous to how we economize our time and use our own property. Just as the polluter’s actions affect others, our personal decisions do as well. If someone keeps her house looking nice and her lawn is perfectly manicured, the values of all other houses on the block rise. The homeowner still has the incentive to make her house look nicer because it increases the value of her own property and most people enjoy living in a better looking home. However, the social benefit of her doing so, which is the best interest of everyone in society, is more than she realizes when she does it on her own accord. Homeowners thus spend less time and resources on keeping their houses looking nice than would be warranted from a societal viewpoint, ceteris paribus. This is a positive externality.

Lastly, a spin on positive externalities is when certain circumstances benefit the economy in general through a nebulous, serpentine path. Parents may usually care deeply for the wellbeing of their children. Even if the government didn’t support it, even middle-lower class Americans would spend some of the meager disposable income they have to give their children a degree of education. Despite that being the case, too few children may receive education because a more educated society benefits each and every member within that society. Take a day laborer or a cashier at fast food chain. The poorer end of society will likely take these jobs regardless, but if they are better educated, they may do them more effectively. Is it really that tough to imagine that effective communication skills may benefit the day laborer or better math skills may benefit the cashier? Of course, these are to a certain extent inevitably reflected in the wages they receive, meaning that well-meaning and scarcely financially-able parents have already considered them. Despite this, it may still stand to reason that free academic training will benefit everyone since employers will no longer need to choose between the margin (those who have the equivalent education of junior high) and the margin of the margin (those who have no education whatsoever). If everyone is able to push society forward somewhere, everyone is better off.

So, if we tax those who cause negative externalities and give it to those who either make choices that benefit everyone else or purchase products that help more people than the single consumer, we should be collectively better off. If we can say how much damage or benefit they cause society, the government would be advised to tax and subsidize so the economy will allocate properly.

The fallacy lies in treating an economy as single unified force rather than a collection of individuals attempting to maximize their own happiness with what they have. If we tax the polluter, assuming we can accurately ascertain the damage to the environment caused by his pollution, we can force the industry to begin polluting at a rate that best benefits society. If you look at the opinion of the lower 10% and upper 10% on what the true price of polluting is, you will get very disparate answers, but that is not my point here. Rather, I wish to consider who is receiving the money the taxes generate. Preferably it is “society” in general, meaning everyone equally, since that is what economists arguing for taxes against pollution assume, but it really isn’t. Instead, it’s whomever the government is spending tax dollars on at that moment, whether that be the rich, the poor, the majority, or the minority. If you believe the government should spend more on one of those groups, that’s fine, but again, it is not in the scope of this discussion.

So let us tax that polluter, while assuming the money he pays in tax equitably goes to society. He pays an extra 10% per unit, as does his competitors. An extra $100,000 goes into the public coiffures. We now may decrease taxes elsewhere. Supposedly, this $100,000 is expected to counteract the negative effect of dirtier water caused by the pollution. On the producer’s side it does reduce it, but who is reimbursed for the cost of pollution? Everyone. In reality, everyone isn’t affected by that pollution, just those who locally use the river. Through a reduction in taxes or in an increase in public services, those who use the river continue to bear costs that do not match the governmental benefits that are provided to them. Meanwhile, everyone else is able to take a very slight profit out of the situation since they feel some benefit and no cost. Considering the multitude of situations in which the government is somehow involved, these costs add up.

The total effect of averaging each situation, ignoring that the correct people are not paying or receiving societal costs or benefits of their individual actions, is a classic problem that statisticians and economists fall into. It is said that a statistician can have his head in an oven and his feet in ice, and he will say that on the average he feels fine. Slowing pollution or providing allowances to those make their houses more attractive is only one side of the problem. The neighbors are the ones who should be paying the homeowner to paint that fence, not someone across town who will never see it. Unless the nature of humanity changes, it is not a behemoth of averaged and weighted tastes and beliefs, but an unorganized mess of personal values. The goods are allocated “efficiently” as far as the society in general is concerned, but not each of the individuals.
This does not “disprove” the use of taxes and subsidies to promote welfare. In fact, as long as the externality is calculated properly, taxing and subsidizing respective externalities will unequivocally increase utility. Yet, the question is far more complex. Economists and policymakers must come to terms with the fact that unless the tax and subsidization solution is dealt with ingeniously, the government will either tax or give money away to some people for no reason at all. To put it playfully, there are externalities to attempting to solve externalities. This issue, in conjunction with several other established, applicable, economic arguments questioning the effectiveness such government intervention renders the political question far more muddled than it appears in most textbooks.