28 September 2015

Government Paternalism: Nanny State or Helpful Friend?

Julian Le Grand and Bill New
2015, Princeton University Press, 232 pages, £19.95
ISBN 9780691164373

Reviewer: Neil Reeder, Head and Heart Economics

Julian Le Grand is one of the UK’s most notable social policy theorists, not least for his work in clarifying the mix of motives and incentives that characterise the providers (‘knights and knaves’) and clients (‘pawns and queens’) of public services. That blend of expertise combining with a refreshing, simplifying breeziness is evident in this book, which seems to be aimed at the same readership that took so strongly to Sunstein and Thaler’s 2008 book Nudge.

Le Grand and New fully acknowledge that paternalism frequently has a bad name (indeed, as far back as 1830 the historian Macaulay argued that England’s progress was due to the ‘prudence and energy’ of the people, rather than the ‘intermeddling’ of a would-be ‘omniscient and omnipotent state’). The authors, however, remain optimistic, despite those commentators, such as Micklethwait and Wooldridge (in The Fourth Revolution), who argue that governments make too many promises, try to do too much, and frequently do it in a bloated, mediocre and bureaucratic way.

The crucial stepping-stone for analytic progress is Le Grand and New’s definition of paternalism as supporting people to overcome failures of judgement for their own good, providing that their aims and values do not entail harm to others (in a nod to the libertarianism espoused in Mill’s On Liberty). Thus, Le Grand and New depict a strategy that falls mid-way between a government that micro-manages, and one that minimizes its role.

The authors’ approach is shaped by a context in which behavioural psychology has shown that people make – or can be manipulated to make – poor choices. Such rationales clearly drive the arguments contained in Nudge and indeed, on Le Grand and New’s definition, paternalism encompasses ‘nudges’, but allows for a broader range of actions that can infringe autonomy – providing that the disbenefits to autonomy are clearly outweighed by social benefits.

Moving from concepts to practice, paternalism is applied by governments in many different ways, from enforcing ‘cooling-off’ periods for contracts, to requirements for listing information (‘shares can go down as well as up’) and outright bans. The examples that the book includes – smoking bans, which are one of the most powerful levers for public health improvement according to the World Health Organization; pensions opt-outs, which have the potential to address much of the crippling effects of poverty amongst pensioners – are of fundamental importance to many people’s wellbeing.

Yet paternalistic actions also have limits. The authors grapple with the weightiest of moral principles, when contending that laws banning assistance for suicide for those in pain facing terminal illnesses go beyond what can be justified on the basis of a purely paternalistic approach. Whether right or wrong, this represents a brave, reasoned attempt to set boundaries for a secular State.

The book covers far more difficult terrain than its predecessor in this tradition, Nudge. The drawbacks to its solutions are more obvious, not least in terms of hindrances to autonomy, and unrealistic expectations among the public that the risks they face in transactions can be reduced to minimal levels. Even so, the book convincingly clarifies when paternalism arguments underpin policy perspectives, and hence clarifies the true extent of justification for such perspectives. And so in turn this book is an important contribution to public policy.