The National Interest

What is in the National Interest?

• A specific policy or set of policies?– National security: But how is it best protected?– National prosperity: But how is it best achieved?

• Whose preferences define the NI:– What a single leader/dictator wants?– What a majority of informed citizens want?– What a majority of all citizens want?– What a super-majority wants?

• Arrow’s Theorem and the NI

Rational Choice

• Bare-bones rationality: People have preferences and they pursue them

• The stronger version: Those preferences are usually selfish

• Rational actors do what they believe is in their best interest.

Why Assume Selfish Rationality?

• We don’t want to base our policies on the assumption that everyone is benevolent– This is a recipe for disappointment

• If we assume the worst, we may end up pleasantly surprised

• We also don’t want to assume that people are omniscient.

• Rational choices can result in individually or socially “bad” outcomes. We want to see how to minimize this risk.

Rational Actor Preferences• Completeness: Can compare

alternatives x > y : “x is preferred to y” y > x : “y is preferred to x” x ~ y : “Indifferent between x and y”

• Transitivity: x > y & y > z, then x > z x ~ y & y ~ z, then x ~ z

A trade example with majority rule• Alternatives: Free Trade (F), Protectionist

(P), or MFN (M, Most Favored Nation Status)• Individuals/Blocs– Democrats: P >D M >D F– Republicans: F >R M >R P– Independents: M >I F >I P

• Social preference under majority ruleM >S,maj F >S,maj P

Trade example with Borda countIf N choices, top choice gets N-1 points, second N-2, . . ., Nth = 0 points: Preference-weighted voting.

P: 2 + 0 + 0 = 2M: 1 + 1 + 2 = 4F: 0 + 2 + 1 = 3

• Social preference under Borda count

M >S,bor F >S,bor P

Social Choice: Mapping Preferences to Policy Choice

• There are many ways to aggregate preferences– Majority, Borda, Plurality, Condorcet, Approval, Run-off, etc.– Not all ways lead to the same choice under all circumstances

• Plurality: Sanction; Run-Off: Destroy; Borda: Accept• Which policy choice is in the national interest?

Candidate Preference

Destroy Iran’s Nuclear Facilities

Sanction Iran’s Economy into Submission

Accept Iran’s Right to Enrich Uranium under NPT

Democratic Voters(Hypothetical 40%)

3rd Choice 1st Choice 2nd Choice

Republican Voters (Hypothetical 38%)

1st Choice 3rd Choice 2nd Choice

Independent Voters (Hypothetical 13%)

2nd Choice 3rd Choice 1st Choice

Libertarian Voters (Hypothetical 9%)

3rd Choice 2nd Choice 1st Choice

Making Social ChoicesFour Conditions to Pursue Fairness:

•Universal Domain: All preferences are admissible

•Transitivty/Pareto Efficiency: Making someone better off, makes no one worse off. If anyone is made worse off then the choice is Pareto Inferior. Pareto efficiency cannot be achieved if social preferences are intransitive

•Unanimity Principle: If everyone prefers a to b, b cannot be chosen. •Independence of Irrelevant Alternatives (IIA): If a>b, the introduction f c does not make b>a

Universal Domain• You don’t know what issues will face society in the future

• You want a rule that tells you how to add up individual preferences so as to choose what is best for society and you want that rule to perform sensibly, regardless of what issue comes up

• The aggregation rule must satisfy normative criteria for all possible collections of alternatives and preferences

• But universal domain implies social problems in choosing what to do:

Pareto Efficiency/Social transitivity

• Pareto Efficiency Social Transitivity– Social preferences should be transitive

– Remember: If X > Y and Y>Z then X>Z is a characteristic of a rational person.

– If all individuals have transitive preferences, must society’s preference (the aggregation of each individual’s preferences) be transitive?

Social Intransitivity: The Iran Example• US Congress: Hawks, Doves, Moderates• Hawks: Destroy > Sanction> Accept• Moderate: Sanction> Accept > Destroy• Doves: Accept > Destroy> Sanction

Congress: Destroy > Sanction > Accept > Destroy Social Intransitivity

• Why is this a problem: Money pump.• Society has $50 billion to spend on Iran policy. –Use $10b to support sanctions: not happy; Use another $10b to

shift agenda to Accept under NPT; not happy; use $10b to shift to Destroy; not happy . . . All $50b spent and nothing accomplished.

Unanimity & Congress Passes a Bill: The Trade Example

• US Congressional Procedure: Propose bill; offer an amendment; offer an amendment to the amendment. Choice Sequence:

• First vote on any amendment to an amendment vs. amendment; • then vote winner of above vs. bill; • then vote winner of above up or down (down = status quo).• 3 people, 4 choices: (1) Proposed Bill: Free Trade (F); (2) Amendment:

Protectionism (P); (3) Amendment to Amendment: Most-favored nation status (M, bilateral trade agreements); and (4) Status quo (Existing Law): hodge-podge policy (S)

• Pat: P>M>S>F• Chris: M>S>F>P • Dana: F>P>M>S• Congress’s Choice: M vs P P wins; P vs F F wins; F vs S S wins• But M unanimously preferred to S!

IIA: Cuban Missile Crisis• Executive Committee Debate: Blockade (B), Surgical Air Strike (A); Invade (I);

Later added Diplomacy (D)• McNamara: B > A > I• R. Kennedy: I > B > A*• Taylor: A > I > B• Bundy: A > B > I• Borda gives A 5 points, B 4, I 3 so A WinsHold preferences constant for A, B and I, but add D• McNamara: B > D > A > I• R. Kennedy: I > B > D > A• Taylor: A > I > B > D• Bundy: D >A > B > I• With D, Borda gives A 6; B 7; I 5; D 6 so B Wins

* (Latest information, http://www.unc.edu/depts/diplomat/item/2007/0709/whit/white_rfk.html)

Arrow’s Impossibility Theorem

• Suppose the following– At least 2 people/choosers/voters – At least 3 alternatives– Choosers each have a ranked preference ordering on the

options• Then:

• Only one aggregation rule satisfies– Universal Domain– Pareto Efficiency– Unanimity– Independence of Irrelevant Alternatives

• That rule is dictatorship

The (S)electoral System Matters• Under different systems – Votes are counted differently– People vote differently– Different parties form on different policy positions– Different candidates run

• Voting can be thought of as a special case of the exercise of political clout or power. Voting assigns equal weight to each voter; international politics does not. This does not diminish the problem of finding the right foreign policies and it may make it harder.

Is There A National Interest?If There Is, Can We Know That

We Know What It Is?

Policy Preferences

Free Trade

Fair Trade

Democrats

Status Quo

Lower Defense Spending Higher

Blue-Collar Independents

Republicans

Trade Policy

That Beat the Status Quo