Ought Implies Can
Ethical Pronouncements without Economics Lead to Diastrous Public Policies
One of the most common objections to free markets is that they ignore ethical considerations. In particular, critics argue that there are many things we “ought” to do that they believe will make people’s lives better off. We ought to “redistribute” income to the poor, they say. We ought to make health care a right. We ought to fix the economy by bailing out the financial industry.
The problem with all these “oughts” is that they eventually confront the principle ought implies can. Can the desired end (improving the welfare of the poor, for example) be achieved by the chosen means (income “redistribution”)? If not, then what does the “ought” really mean? “Oughts” without “cans”–ethical pronouncements without economics–are likely to lead to disastrous public policies.
In exploring the relationship between economics and ethics, we can start with two definitions that seem relevant here. The economist David Prychitko once defined economics as “the art of putting parameters on our utopias.” And in a particularly insightful definition, Nobel laureate F. A. Hayek wrote that “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” What both definitions suggest is that economics deals with the realm of the possible and in doing so demarcates the limits to what should be imaginable. Before we say we “ought” to do something, perhaps we should be sure we can do it, in the sense that the action is likely to achieve the intended ends. Put differently: ought implies can.
Ethicists can imagine all kinds of schemes to remedy perceived social ills, but none of the aspiring benefactors can afford to ignore economic analysis. Being able to dream something doesn’t guarantee it is possible. Too often ethical pronouncements have an air of hubris about them, as the pronouncer simply assumes we can do what he says we ought to do. By contrast, economics demands some humility. We always have to ask whether it’s humanly possible to do what the ethicists say we ought. To say we ought to do something we cannot do, in the sense that it won’t achieve our end, is to engage in a pointless exercise. If we cannot do it, to say that we ought to is to command the impossible.
So contrary to the commonly heard complaint, it is not that economists ignore ethical issues. Rather we attempt to describe the likely results of putting particular ethical rules into practice. For example, someone can argue that a living wage is an ethical imperative, but that doesn’t change the economic analysis of minimum-wage laws. Those laws increase unemployment and/or lead to reductions in nonmonetary forms of compensation among all unskilled workers, but especially the young, male, and nonwhite. No matter how much we think we ought to pass such legislation as a way of helping the poor, the reality remains that economics shows us that we cannot help them that way. Those who argue we ought to have such a law can still pass it if they want, but they should do it with eyes wide open to the fact that it will not achieve the result they wish, no matter how much they think we ought to have it.
It might be more accurate to say that ethicists ignore economics than that economists ignore ethics. To the extent that good economics shows what we can and cannot do with social policy, it is engaged with ethics. After all, if the point of saying we ought to do X is that we think it will achieve some set of morally desirable goals, then knowing whether or not doing X will actually achieve those goals is, or at least should be, a key part of moral inquiry. One of the tasks that economists should set for themselves is to engage in this sort of dialogue with moral philosophers and others who argue from “oughts.” Economist Leland Yeager’s recent book Ethics as Social Science is a good example of how economics can inform ethical questions just this way.
Studying “Ought,” Ignoring “Can”
The more interesting question is the degree to which moral philosophers are engaged with economics as they develop their theories. It might be true that introductory economics courses do not consider moral questions as often as they might, but it would seem at least as true that courses in ethics and religious studies are unlikely to confront either economic arguments or economic data that relate to their subjects. Exploring the “ought” without broaching the “can” will not get one far in designing policies that will achieve the intended results. One exception to this neglect of economics is the philosopher Daniel Shapiro’s Is the Welfare State Justified? In that book he brings to bear a good deal of empirical data and economic theory on the question of whether the welfare state can do what its proponents claim for it. From the philosophy side, this is the kind of work that needs to be done.
Can Doesn’t Imply Ought
Once we recognize the insight behind “ought implies can,” we can see that the reverse is true as well. Just as we cannot do everything people say we ought, we ought not do everything we can. We see this in the frequent calls for political actors to “do something” in the face of a crisis. There are many things politicians can actually do in a crisis, and doing them is often fairly easy, especially if the politicians can generate a climate of fear to help make the “ought” seem more pressing. But the fact that they can do something does not always mean they ought to. Even if it is true that “yes we can,” understanding the unseen and unintended consequences of what politicians are able to do should help us to decide whether they ought to do it.
Both ways of looking at “ought implies can” put economists in the position of throwing cold water on the plans and designs of social engineers left and right. This is what Prychitko and Hayek mean. Economists are thus often seen as only knocking down the ideas of others without coming up with solutions of their own. There is some truth to this claim. That is how economists spend much of their time. But it’s an important function: showing why a proposed solution would only make matters worse is a valuable contribution to the broader process of solving the problem.
More relevant, however, is that economics teaches us that solutions are much more often found in the actions of individuals and organizations responding entrepreneurially to the situations they face. The notion of a top-down solution to any social problem is going to attract the economist’s critical eye. In terms of “ought implies can,” economists are often reluctant to say what everyone ought to do because no one person or group knows what people can do. If ought implies can, and “can” is particular people in particular contexts developing solutions to their problems, then it is difficult to say what we all ought to do, especially in a crisis. This is the way that Prychitko’s and Hayek’s definitions cash out in the real world.
All the themes above have been on display in the current economic crisis. The bailout of the financial sector is a classic example of both letting the “ought” blot out the “can” and of assuming we ought to do whatever apparently can be done. The original promise of the bailout was that government would buy up the bad assets of troubled financial institutions then later resell the assets, making the real cost substantially less than the original $700 billion. Many critics, including many economists, suggested not only that this plan was counterproductive–because it only enhanced the likelihood that other firms would take unwise risks in the future–but also that the availability of those funds would lead to demands for the government to use them in other equally unproductive ways. That is more or less what has happened, as the bailout expanded to partial government ownership of banks and then demands from the auto and insurance companies to get in on the goodies. The plan changed again when the government announced it wouldn’t purchase troubled assets but instead would inject money directly into banks and other kinds of businesses. But soon all the “oughts” were crashing against the limits of what can be done via government intervention. Meanwhile, the machinery of government did many things it can do–borrow and create money, for example–without the planners thinking very much about whether they ought to do any of those things.
Social scientists who disregard ethical issues abandon one of their central roles in bettering the human condition, and ethicists who ignore social science in formulating their moral prescriptions are negligent for not asking whether those solutions will achieve their stated ends. Only when both realize that ought implies can will we get public policies based on an accurate understanding of human interaction.
Comment by Cokehead on 28 April 2009:
The article starts with a strawman, viciously attacks said strawman, and then insults the strawman\\\’s perception on issues, using nonsensical metaphores and more philosophy than anything practical..
The problem, of course, is that it\\\’s all a strawman.
Comment by Shakes on 11 September 2009:
I loved the article.
It is all about the unintended consequences.
Pingback by Can we do what we “ought” to do? : Minor Thoughts on 24 September 2009:
[...] I just read a pretty good essay over at The Freeman, discussing the difference between what we can do and what we ought to do. Too often, people talk about what we ought to do before even considering if we can do it. The essay, appropriately enough is Ought Implies Can. [...]
Pingback by Steve Horwitz on Health Care: Ought Implies Can « Daniel Joseph Smith on 13 October 2009:
[...] Steve Horwitz on Health Care: Ought Implies Can By Daniel J. Smith http://www.thefreemanonline.org/featured/ought-implies-can/ [...]
Comment by David Hillary on 20 December 2009:
Steve, this is very well argued and has a lot of force, but it seems to open a the question of scope. For example, does inability to discharge an obligation void the obligation? Does that mean that insolvent debtors no longer ought to pay their debts? I guess that is exactly what insolvency law does: it limits the ought to the can.
Does it mean compulsion is always an excuse?
Also there is the means-ends rationality issue. Before we can decide if a means is rational in attaining an end, we have to accept the end. For example if gun control was a rational means of reducing violence, would it justify gun control? Or if conscription (drafting people into the armed forces) were effective in defending the country would it justify it?
Comment by Centro Adam Smith on 15 January 2010:
Una traducción al español de este artículo fue publicada, con la debida autorización de FEE, en la Revista Digital Orden Espontáneo editada por el Centro Adam Smith perteneciente a la Fundación Libertad (Rosario, Argentina). http://centroadamsmith.files.wordpress.com/2010/01/oe7dic.pdf
Aquí pueden ver los restantes números de la revista: http://centroadamsmith.wordpress.com/revista-digital-orden-espontaneo/
Saludos.
Comment by bob on 15 April 2010:
Some of these comments severely miss the point. Steve is not laying out a moral philosophy here, describing which moral principles should be given priority over others. He is simply saying “ought implies can” while “can does not imply ought”.
In the case of debt, obviously, the debtor should pay back the debt, to the extent of his ability. If he can’t pay it all back, then there is no point in saying he ought to. A better way to phrase this is that the lender should not have lent this man money. The lender SHOULD make money – that’s his job. Should he have lent money to this guy? No. Why? Because he CAN’T pay it back.
In the case of the state using its own conceptions of morality as an excuse to use force as an attempt to realize their moral values, Steve is surely not saying that such force is just. He is simply segregating the concepts of imagined utopia and morality, based upon practical ability.
For instance, an imagined world without hunger definitely seems preferable to our current world. For this to be a moral goal, however, requires at least that it is achievable. Furthermore, it must be weighed against existing moral goals, which it must contradict.
Thus, the state’s imagined goals should not be upheld as moral goals because they are both impossible to realize and conflicting with existing moral values.
Pingback by Ought Implies Can, Ethical Pronouncements without Economics Lead to Diastrous Public Policies - Science of Virtues | A Project of the University of Chicago - News on 21 April 2010:
[...] pronouncements without economics–are likely to lead to disastrous public policies."Read the article. Posted: by cait Filed under: ethics, [...]
Pingback by Recomendaciones « intelib on 13 June 2010:
[...] Ought Implies Can, by Steven Horwitz [...]
Comment by Beth on 19 January 2011:
To the first poster Cokehead:
Exactly where is the strawman?
I just finished with a college ethics class and they indeed reflected exactly the kinds of issues that this article examined.
We participated in ethical debates and the article accurately reflected how a lot of the ethicists think.
Please provide your example of the Strawman. Claiming that parts of the article and the whole article itself is a strawman without evidence does not make it a strawman.
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