Unintended Consequences: Swiss Edition

[Jack McOck]

One concept in economics that the interventionists clearly don't understand is that of unintended consequences. The shorthand is that human economic behavior is chaotic, and thus it's impossible to exert an influence on one branch without affecting the whole.

An example of this can be seen in the town of Lausanne, the cultural centre of Switzerland.

Attempting to coerce people into recycling, the left has recently introduced a hefty 1000% tax on "regular trash" bin bags, to encourage people to "save money" by putting paper, plastic and glass into separate, non-taxed bins. And if you dare put non-taxed bags into taxed-bag bins, a fine in excess of CHF 400.- (~$400.-) awaits you. And that's just for a first offense.

At first glance, this would actually seem like an effective policy, as not recycling simply becomes too costly for most people. However, the unintended consequences reveal the folly of the plan:

1. People have started dumping their trash in the street.
2. Gypsies have taken to opening up the bins, empting the taxed-bags into the street, washing them, and reselling them at a cut price.

It will certainly be interesting to see how this situation evolves, specifically whether or not the left will apologize for yet another inefficacious and wasteful policy.

[Forge.]

doesn't this just show that some people are just selfish and lazy?

I can't actually even remember a time when we didn't recycle in Australia or England. Everywhere I've ever lived had has always had two bins, sometimes even a 3rd for compost as well.

[Jack McOck]

You're right, I brought a lot of presumptions with me in my initial post. My point was to demonstrate an economic phenomenon, not start a rant on recycling. We can have that discussion another time

Another example then: The Swiss voted to ban the sale of alcohol in shops past 21h in order to "preserve our youth" (albeit obviously not in alcohol); the result has been massive pre-party, binge drinking, followed by all the glorious public disorder and nudity that you could wish for.

See the trend? The state acts in order to obtain A (typically with a "moral" component), and as a direct consequence obtains non-A, and B, and C, none I which are necessarily desirable, or even predictable by anyone save the most astute praxeologist.

Incidentally, an unintended consequence string of recycling paper is decreased demand for new paper, thus decreased demand for trees, thus decreased tree production, thus fewer trees in total.

You read that right: all things remaining equal, recycling paper reduces the number of trees on the planet.

[pepezabala]

Dear Jack, of course there will always be unintended consequences as soon as you move on instead of lying on the ground and waiting for life being over. And without progress we would still sit in caves and play music on flutes made of bones. And drums made of wood and animal skin. Which isn't that bad, compared to Rebirth for iOS. Still without progress we also wouldn't have Kraftwerk, nuclear power plants and Dubstep. Which one of these is the uninteded consequence?

[Jack McOck]

Dear Pepe, forgive me, are you calling policies that directly lead to teenage delinquency "progress"?

The point is not that we should "lie on the ground", but rather that we should be aware of the fact that nothing ever goes entirely as planned; and the more complex the system we try to influence, the more unpredicatble the outcome. The point is to advocate caution. The point is to debunk the implied or even ouvert interventionist notion that you can control human behavior as easily as you can enact laws.

[8O]

Which isn't that bad, compared to Rebirth for iOS.

Tidy.

[re:dream]

Hmm, I don't know what passes for 'left' in switzerland (the social democrats?) but point is, waste disposal costs. The question is where and how do you pay for it? Allowing people to not recycle creates significant costs downstream (you either have to use up valuable landfill, or you have to pay a lot more to sort it yourself).

So you can increase rates, but that creates a huge burden. And the point is you are creating a free rider problem. There is no incentive to recycle, since everyone is paying the rates anyway.

Targeted taxes are a way of trying to shift the cost burden upstream to the polluter. The more you pay, the less you recycle. Simple.

Another strategy is moving the cost further upstream still, to the point of sale. You can put a surcharge on glass bottles, batteries etc etc. But again, you are now making buyers who recycle pay for the actions of those who don't.

On the whole, and from what I can gather, and in comparison to waste management elsewhere, the Swiss are doing very well. The recycling rate for municipal rubbish is very high, and they are able to dispose of the rest without using landfills. Far from a case study on the irrationality of the left, they could as easily be held up as an example of a country with a very well managed waste disposal system.

Compare this with my home town, Cape Town, where rubbish disposal is simply included in municipal rates and recycling is entirely voluntary.

Result: mountains and mountains of waste. We are running out of landfill sites, and in a very short while we will have an official waste disposal crisis.

That's also an unintended consequence.

[Jack McOck]

Indeed. Like I said, I don't want to start a flame war over recycling. There'll be a new thread for that when the time is right. My point is simply as stated above: Dynamic systems are tricky buggers.

[re:dream]

Yes, but you were also constructing a straw person: those nasty lefty planners who try to coerce people with taxes.

People who design tax systems generally know that they are dealing with dynamic systems, and they know that some people are going to avoid / evade / do other things. They don't sit in some imaginary lala-land, imagining everyone will step smartly into line. They implement a tax, see how people respond, revise the tax, change the fines, devise additional measures, and so on.

Now of course things can get out of hand in interesting ways. If the citizenry as a whole starts feeling overburdened or resentful, start refusing to pay taxes, or revolt against the tax system, the centre of gravity of swiss politics could change, and the dynamics of coalition politics could change radically.

A few people dumping litter in the street, or selling bin bags to mess with the system, is hardly a crisis of the system as such.

[Jack McOck]

No strawmen, those evil socialist puppeteers are real. I've even met a few in person. The rest of what you say is valid enough, although I have also met a few politicians who genuinely believe that lala-land is attainable if we could just reprogram human nature.

"A few people" is actually a huge step back in terms of our culture. We are Swiss, after all.

People who design tax systems generally have no idea what they are doing.

Fixed.

[re:dream]

People who design tax systems generally have no idea what they are doing.

Fixed.

Well, that's one way of dealing with folks who disagree with you

[Jack McOck]

People who design tax systems generally have no idea what they are doing.

Fixed.

Well, that's one way of dealing with folks who disagree with you

The last one had to leave.

[nathannn]

the left has recently introduced a hefty 1000% tax on "regular trash" bin bags,

1. People have started dumping their trash in the street.

I find this hilarious

Why didnt they just ban traditional trash and make a law that says you have to recycle?

[nathannn]

double post.

[Jack McOck]

You're asking me to speculate as to the motives of the legislators, which at best are confused. Perhaps The Finn could answer this for you; he seems to have the puppeteers—and their honourable intentions—all figured out. Cough.