Reconciling self interest and the public good

The conflict between individual benefit and community gain;
The inherent problems of penalty and regulations based strategies;
Introducing the third way – Rewards for cooperation and mutual benefit.

In a world populated by more than six and a half billion people and with finite resources, the provision of public goods seems to be on a permanent collision course with the pursuit of individual interests.

It’s a conflict that has been pondered by philosophers since humans first began living in groups, but increasing population pressure and a new sense of environmental fragility seem to be exacerbating the issue in the twenty first century. Dubbed “The tragedy of the commons” by Garrett Hardin, the conflict occurs in relation to a shared, finite resource and problem that arises when an individual is presented with a choice between personal gain or one that benefits all. According to popular thought, the course of action resulting in personal gain will win out almost every time.

The classic parable used by Hardin, and before him, by nineteenth century writer William Forster Lloyd, describes the problem by considering an English village common as the finite resource. Used by herders as pasture for their flock, the common has a fixed capacity to support x number of animals beyond which overgrazing occurs and the pasture will become degraded and unable to support the flock. If individual herders wish to maximise their personal benefit from the common they will need to add to their flock before the other herders take up the commons’ spare carrying capacity. However if each herder follows this path of self interest, too many animals will be added to the commons resulting in overgrazing, ruining the opportunity for all.

Hardin concludes, “Therein is the tragedy. Each man is locked into a system that compels him to increase his herd without limit – in a world that is limited. Ruin is the destination toward which all men rush, each pursuing his own interest in a society that believes in the freedom of the commons.”

To bring the parable into modern terminology, simply substitute the phrase “public good” for “the commons”. Public Goods are items or services that share two main characteristics: non-excludability, meaning that if the good is available to one, it is equally available to all; and non-rivalry, such that consumption by one entity should not reduce the capacity for another to consume it or benefit from it. A good example is the air we breathe. It remains freely available to all and regardless of how much air one person consumes it in no way impinges on the availability of air for others. Other often-quoted examples include the defence of a nation, traffic lights and street lighting, and the content of copyright. Global Public Goods, as the phrase suggest are Public Goods that are not confined by national boundaries, such as peace and health.

The question of the Tragedy of the Commons remains as relevant today as it was in the 1800s and it has become a matter of particular concern to governments around the world. It poses a problem that stymies the provision of any public good. Consider these modern day examples.

Carbon emissions are causing major environmental problems. Even with full knowledge of the issue businesses are increasing their use of fossil fuels and many urban dwellers persist in purchasing large, fuel-hungry vehicles rather than opting for public transport. The finite public good– our quality of atmosphere – is degraded due to individual and business desire for short term personal advantage.

Water provides another example. Over the past decade much of Australia has experienced severe drought resulting in the introduction of water restrictions in every capital city. Yet throughout this period total water use continued to exceed sustainable levels. Other examples can be seen in the depletion of ocean fish stocks through overfishing; and forestry, land clearing and agricultural practices that result in erosion and soil salinity.

These resources are all freely available yet finite in quantity. Plus they are all public goods that fall within the scope of government management and administration. To date this has largely occurred in one of two ways:

  1. Regulating the use of the resource in question; and
  2. Creating and allocating “rights” to the resource.

One of the most common economic means of regulating a public good is through the imposition of taxes or levies. While the income from such taxes is usually considered part of the government’s consolidated revenue there are examples of the money being used to help rectify the negative attributes – or negative externalities – of an activity. To alleviate the problems of air pollution a government could impose a tax on those who create and contribute to the pollution problem. . Regardless of what the regulations are or how they are imposed, this approach is ultimately one of coercion.

The second approach, dividing up the commons into property rights, can be viewed as the “selfish” alternative. It attempts to preserve the integrity of the commons by restricting access to the resource so that it will not be entirely depleted. In addition it offers a limited group of individuals the opportunity for personal gain if they manage the resource correctly. The method is frequently used in relation to fishing – where limits are placed on the quantities or types of fish allowed to be caught; and in land clearing, where quotas are set specifying how much land may be cleared annually. It is also being adapted to non-traditional solutions through activities such as emissions trading.

Arguments for either approach paint a bleak picture. A major problem with systems that create rights is the difficulty of defining those rights, especially given by definition, rights to a public good are rights to something that is already freely available. The difficulty is compounded by the impossibility of the task. Because rights trading depends to a large extent on the accuracy of the measurement then its effectiveness will depend on how well it is done. In the case of a fishing trawler, how accurate is the tally of fish really going to be? Once the net has been cast is it possible to limit the catch to the exact quantity and type of species allotted to the trawler?

Moreover, an appeal to selfish interests works only if enough people share the same interest. In other words expecting people to cooperate based on financial gain works only if everyone is motivated by financial gain. It has been debated that in modern culture people are largely no longer motivated by shared interests, but instead choose actions based on values. Asking people to adapt or change their behaviour to accommodate potentially diametrically opposed values is a request that goes against one’s culture and it rarely works.

Coercion as a force for remedying the tragedy of the commons is equally limited in its effectiveness. Coercion requires the cooperation of the public, as few modern societies are able to enforce regulations in the face of sustained rebellion. And to gain the cooperation of the public requires general acceptance of the basic values behind the regulation, or a common values system. In today’s pluralistic and fragmented societies, such a values system is increasingly unlikely to be found.

As long as we remain locked in to these two approaches – regulation or rights – we will continue to grapple with public goods as neither way can be successful in the long term. The result is the decay of the common good and it is the natural outcome of a competitive mindset.

This book describes a third way that any organisation – federal, state or local government, community association or charity – can address the problem of the provision and protection of public goods. Adopting the principles of humanism, it resolves the “Tragedy of the Commons”, achieving sustainability by making cooperation in the best interests of all. Above all, it resolves the issue both equitably and democratically.

9 thoughts on “Chapter 1 – Reconciling self interest and the public good

  1. Its a very interesting framework. It seems to me the biggest problem is to explain it to people. The whole approach depends on having a population of people who are motivated to gain the ‘rewards’ but for that to happen they have to understand the framework. While this essay does a good job of explaining the issues to someone willing to read it, I think very few people will be motivated to do this.

    If I can suggest that your most difficult task is not to implement a system, but to get real people interested. You need a much simpler slogan-style pitch. What would you say if you only had 5 words? 10 words? That’s a generous length. On greenhouse emissions competing proposals are described in two words – ‘kyoto protocol’, ‘carbon trading’, etc. Your one word ‘Rewards’ just doesn’t mean anything to anyone yet.

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  2. Craig you are correct. Our biggest problem is explaining what it is all about. Both your comments and others we have received by email have given us good ideas on how to better explain things.

    Susan Dov Seidman’s ideas are very relevant. Thanks for pointing it out. One way we are applying the ideas (which will be the subject of later chapter) is how to get large organisations involved in greenhouse gas reductions by giving them ways to publicise and prove their efforts to become carbon neutral. Also we know that at the individual level if we take the effort to save water in times of shortage we are more likely to do it if we know that others will recognise our efforts.

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  3. This is a brave attempt at a difficult problem. Have you seen the work done by George Siemens at the University of manitoba where he has a theory of learning “connectivism” based on networking and ecology. He uses existing social software to link people through online conferences, and like me, in a polytechnic,he wants to transform tertiary education to be enabling more learning with less or existing resources, and creative commons is another global initative. It’s not just in K-12, but in parts of tertiary too…

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  4. I like the idea, but like the comments above I think that the problem is getting large buy in for the ideas. Here in the US so much of our society is characterized by greed and there are way too many people (leaders) who are not motivated by fairness, but by their own ideas of what is right (whether it be attacking other countries or making millions of dollars).

    One thought that I have which may be something you are talking about later is that MAYBE if we start teaching children differently, allowing them to think and make more decisions, giving them the knowledge that they need at the appropriate time when they become adults they will have held on to their strong feelings about fairness.

    One other thought is more vague, but related I think. At times I get frustrated by all of this technology in schools. I think about how much it costs and how difficult it is to get teachers to change and use it. Then I think about the future and how MUCH the existence of our own planet depends upon technology. We really need to have students using technology in creative ways and connecting beyond borders in order to solve some of our large problems.

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  5. Could you add a link about who you are on your blog so that someone who reads it will have a reference to go by? I wanted to link to your blog in mine, but I don’t really know who you are, so I can’t really describe you.

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  6. Janice my apologies. As the centre of our own universe we always forget that others do not know us:) It turns out that if you do not know anything about me you are unlikely to take any notice of what I say. You will make your judgment on this blog when you understand who I am and what others think about me. What I can do is to tell you about myself and give you references to things I have done and others can confirm so you can make a judgment. You will see the relevance to this down the page.

    I was born in 1940 and am a retired academic and software engineer who started a new life as an entrepreneur in 1998. The reason I have become an entrepreneur is that it seemed the best way to get ideas implemented, it is fun and I could afford to do it.

    I started my working life as a Civil Engineer and in 1962 started modeling complex systems using computers. This modeling of complex systems has been a continuing interest. I obtained a PhD by investigating the idea of building an adaptive learning system that would help us search better. I was little ahead of my time because the hardware was not available to build an efficient system and I did not really understand the ideas I was developing until I had finished – so perhaps I should revisit in my seventies:)

    My last real job was as a teacher in Information Systems at the City University of Hong Kong. While there I coauthored with David Walker one of the first books in user experience called “User Interface Design” which lead indirectly to my latest venture.

    Three years ago I started a company called Edentiti whose corporate goal is “to empower the individual by providing them with an electronic identity that is under their control”

    To get this idea accepted and implemented we have had to look at applications that are possible when we give people this capability. One of the applications that arose is giving people funds so they can invest in areas of community need rather than giving taxes to governments who then struggle with spending it efficiently. Another is being able to prove who you are with your telephone, another is being able to prove your accumulated achievements are true.

    If you look closely you will find this common theme running through this blog – what happens when we give people control over their electronic identities and give them the power of computers to help them in their interactions with others in society. I am now partially doing this with this comment in this blog. (That is another thing about me – I find delight in recursion:)

    At a more personal level you can have a look at some of the meals my gifted wife produces at http://mealsatourplace.blogspot.com/ and you can see some personal photos of places and people at http://picasaweb.google.com/cscoxk – which reminds me it is time I updated the pictures.

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