There is widespread agreement on the proposition that people act according to their self-interest. Marx went further to suggest that people subscribe to ideologies conforming to their class interests. For example, agricultural laborers would believe in land reforms, while big landlords would believe that small farms are inefficient. Gradually the weight of strong empirical evidence has led me to understanding that this proposition is false. Large segments of the population can be brought to believe in, and act according to, ideologies extremely harmful to their self interest. As Dani Rodrik has written in “How the Rich Rule”, political scientists Gilens & Page found that on issues where there was a conflict between the interest of the elite and that of the public, Congress voted in favor of the elite and against the public interest. In the past, the elites have enforced their interests by the use of power. In a democratic age, the same effect is achieved by the use of propaganda. This is striking because the propaganda must convince the public to act against their own self-interest, in favor of the ruling elites. It would seem that you can fool most of the people most of the time. Here is some empirical evidence for my thesis:
- At a time when social services were being cut, and the budget was termed insufficient to repair decaying infrastructure, the public was persuaded to spend trillions of dollar to fight the non-existent threat of weapons of mass destruction, and Al-Qaeda in Iraq. One obvious result of this folly was the destruction of New Orleans by Katrina, widely judged to be a disaster which could have been prevented with sufficient spending on repairs of existing infrastructure for flood prevention.
- When widespread defaults on mortgage backed securities led to a threatened collapse of the financial system, the public was persuaded to spend trillions of dollars bailing out the bankers who had caused the crisis. As Mian and Sufi have shown, bailing out the distressed homeowners could have been done at much lower cost, and would have prevented the Great Recession which continues to this day. However, media hype generated strong sentiment against bailing out the “irresponsible” borrowers (but not the criminal bankers). Thus the public was manipulated into taking actions disastrously contrary to their self-interest.
- Clever propaganda has created an allergy to the term “socialized medicine,” when such a system would be hugely beneficial to the vast majority of the public. In Canada, UK, and Europe, far more cost efficient systems take care of virtually 100% of the public, while health outcomes of the poor in the USA compare unfavorably with third world countries in key areas like infant mortality and life expectancy. Despite the disastrous outcomes documented in “Sicko” by Michael Moore, the public continues to favor private healthcare system due to false propaganda.
- A highly inefficient and unequal educational system ensures perpetuation of inequality, since local funding ensures that public schools in poor neighborhoods have fewer resources. This contrasts with nearly all advanced countries which make efforts to equalize educational resources in public schools. Strong correlation of educational outcomes with income and race shows that an effective but invisible class and race based apartheid maintains solid barriers between the rich and poor. The trillion dollar plus debt owed by students who received a higher education ensures that the poor who borrowed to get a higher education will slave their lives away working for the wealthy who loaned them the money.
All four of these examples show that on issues of critical importance, the public opinion has been molded to ensure majority support for positions which are against the public interest, and favor a tiny elite – the top 0.1%. Thus the public believe in ideologies, and take actions (like voting in Republican representatives), which are highly damaging to their collective interests.
Studying how this is done, and how it can be reversed, is essential. The title of the book by Mian and Sufi is illuminating: House of Debt: How They (and You) Caused the Great Recession, and How We Can Prevent It from Happening Again. (see also, Review & Summary of House of Debt). Basically, manipulation of public opinion led to our collective assent to a trillion dollar banker bailout, instead of bailing out of the distressed mortgage holders. This is like applying medicine to the knife which caused the wound, instead of the wound. By failing to address the cause, the wrong remedy led to the Great Recession which continues to this day. We can only cure the recession by learning the causes, and taking collective action to achieve effective policy goals, which center on debt forgiveness.