Jonathan Chait writes today:
So basically, we're risking mass financial havoc so that... John Boehner can remain as House Speaker, and not have to go be a lobbyist making way more money. That sounds like a bad trade-off for virtually in the world everybody except Boehner. (Boehner's family might even take that deal.)It seems odd to me that, of all the potential pain we're contemplating here, the one sacrifice nobody seems willing to broach is John Boehner having to lose his Speakership and go be a lobbyist. Why is that?
It's really in large part a result of a generation of every-man-for-himself Republican dominance. Greed is always good; you do what's best for you. And there's been this kind of dominance in economics too over the last generation. It used to be much more economists would assume people only care about themselves as a simplifying assumption in most models. They understood it wasn't literally 100% true, and thank goodness. But now there's much more of an attitude among many economists, especially freshwater, that people should care only about themselves, and this is natural and good.
Of course it's not. When people really do think it's every man for himself, you always do only what’s best for you, trust breaks down. People will little be able to work together, and security, crime, monitoring, and contracting costs will explode. Forget about a super complicated high-tech economy with enormous increasing returns to scale when people can't come close to working smoothly together in vast highly intricate interconnected organizations because everyone knows everyone else will hurt them if they can get away with it, because you always do what's best only for you.
Why do you think altruism evolved? because a group of people who can trust each other and work together is far more productive and powerful than a bunch of individuals who all work alone because they can't trust each other.
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