Updating the Governmental Reward Function

COVID19 has revealed considerable weakness in the way governments are incentivized to serve citizens. I propose some updates.

source: The Economist

Today, governments are incentivized as follows:

reward = f(votes)

I propose we transition to:

reward = f(mental health, GDP/capita, votes)

The top priority of a government (and of those aspiring to reach government) is to acquire votes. Since the minds of voters are actually quite easily programmable (read Influence by Robert B. Cialdini PhD), this reward function presents a certain risk of perversion. The period we are living through, for those who dare to think for themselves, has evidenced this.

For instance, cast your mind back to 2018. As you were getting on with your life, thousands of people were likely dying from the flu in your country, per month. This reality would have been stored somewhere in the back of your head, but you would have only thought of it here and there, despite how severe a flu you could catch that year.

If the media had vigorously begun to cite each single death and if a large scale testing operation had been initiated (to spot anyone with hints of the flu), then fear would have gradually settled in your body. Add some immobilization / isolation and some quite large fines for exercising basic rights and you would reach a near helpless / hysterical state of mind quite quickly, as an average citizen. I dare say you would even lose track of the initial non-magnified underlying reality. You would probably lose the ability to think beyond the reality that the above methods would spin up in front of your eyes.

The situation would have pivoted from normality (mostly elderly co-morbid people dying from the flu) to some sort of “new normal craze” and in fact, all that would have been necessary is a series of efforts by media and governments in a certain direction, for period long enough to permeate the collective psyche.

Now, the situation we are living through today is not 2018. This is quite likely a real pandemic and so measures to curb it and protect people are justified. The discussion here is not about ignoring the pandemic, but rather adequately incentivizing our “leaders”. However, this is where the perversion of the above reward function comes in:

  1. If you manage to get a population to live in a state of fear, then as a government you can do what you please with them. Almost everything will be justified.
  2. As you do what you please with them, the only thing you have to do to keep the votes coming in is to scare them even more. Like this, regardless of how much you over extend yourself, you will come across as a hero to many.

I am currently living in Spain and here, I am seeing a number of things which greatly worry me:

  1. Citizens are being economically impoverished very fast. Fines for exercising basic civil rights account for a large % of the average salary. Businesses are totally subject to the latest regulatory ideas of people who have likely never worked a job, created a company or invested their own money in a business.
  2. Public servants are doing alright. The salaries of public servants are not correlated to the real economy and so they are free to continue perverting the reward function with no real immediate cost for them.
  3. General mental health is deteriorating fast. A quick conversation with 20 random strangers you may encounter in the street will evidence this. You may even be experiencing this yourself.

Surely, if the salaries / rewards of goverments were pegged to the above, they would not feel so free to ramp up levels of fear / put their hands into the pockets of their citizens to the degree where perhaps the ailment is worse than the problem. If you talk to anyone today, some will have lost some loved ones (and my heart goes out to them), but most people will be suffering more from the effects of the media + government combo than from COVID19 itself.

For this reason, we need to find in ways to factor in the things we care about into the governmental reward function.

Investor, Technologist. Post opinions, not financial advice. Do your own research. Follow me at TW:alc2022

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store