In September, California passed a bill regulating the gig economy. The worker status bill, which goes into effect on January 1, 2020, redefines âemployeeâ to include freelancers. Progressives hailed the new law as providing needed worker protections.
After the law passed, Veena Dubal, a law professor at the University of California, Hastings, and prominent supporter of the bill tweeted, âI have tears in my eyes and goosebumps on my limbs.â
As 2020 approaches, it is the gig workers who are crying.
Vox Media announced âit would end contracts with hundreds of freelance writers and editors in California.â Vox is the same media company that hailed the passage of the bill as âa victory for workers everywhere.â
A Predictable Outcome
One of Voxâs fired employees, Rebecca Lawson, tweeted: âCalifornia, youâre breaking my heart (and taking my money),â adding:
I am heartbroken that the state I love so much has forced a company I love working for to cut formal ties with people who are doing amazing work — and who are able to help themselves and their families with the extra income that a passion project or side hustle can sometimes provide.
Another freelance writer, Andi Loveall, tweeted:
Just lost my ability to earn a living because of California Assembly Bill No. 5. My freelance brokerage company says they have to let California authors go. Almost a decade of hard work gone in an instant. I can’t stop crying.
The consequences for freelancers were hardly unanticipated. The law of unintended consequences prevailed: âactions of peopleâand especially of governmentâalways have effects that are unanticipated or unintended.â
Dubal and other supporters of the worker status bill could have read hundreds of articlesâincluding here and here, at FEEâthat predicted the dire outcomes for freelancers. As Elizabeth Nolan Brown writing in Reason pointed out:
Mainstream politicians and pundits love to cite “unintended consequences” when their preferred policies cause harm in the exact ways libertarians said they would. It’s a brilliant way to get credit for trying to Do! Something! about a problem while absolving one’s side of any blame for the negative consequences of that action.
I doubt if Dubal, who is regarded as an expert on the gig economy and technology, will acknowledge the consequences of her mistake.
Smart but Biased
Itâs all too easy to dismiss Dubal as stupid; chances are, she is intelligent.
Keith Stanovich, emeritus professor of applied psychology at the University of Toronto, writes,
We have an implicit [but wrong] assumption that intelligence and rationality go togetherâor else why would we be so surprised when smart people do foolish things?
Stanovich, coined the term dysrationalia âmeaning the inability to think and behave rationally despite having adequate intelligence.â
In his book, The Intelligence Trap, David Robson explores âwhy smart people,â such as Dubal, âmake dumb mistakes.â
Robson reports on research conducted by professors Norbert Schwarz and Eryn Newman, who study how our emotions influence our decision-making.
Consider this question: âHow many animals of each kind did Moses take on the Ark?â
Since it was Noah, not Moses, who built an ark, the answer is zero. Robson writes, âYet even when assessing highly intelligent students at a top university, Schwarz has found that just 12 percent of people register that fact.â
According to Schwarzâs and Newmanâs work,
truthiness comes from two particular feelings: familiarity (whether we feel that we have heard something like it before) and fluency (how easy a statement is to process).
Robson explains further:
The problem is that the [ark] questionâs phrasing fits into our basic conceptual understanding of the Bible, meaning we are distracted by the red herringâthe quantity of animalsârather than focusing on the name of the person involved. âItâs some old guy who had something to do with the Bible, so the whole gist is OK,â Schwarz told me. The question turns us into a cognitive miser, in other wordsâand even the smart university students in Schwarzâs study didnât notice the fallacy.
Try this thought experiment. Imagine you are a politician, professor, or a concerned citizen interested in workersâ rights. You have a pre-established cognitive bias that government is the best protector of workers. Thus, a statement such as Californiaâs Worker Status bill is needed to protect the rights of freelancers would likely meet with your approval. Given your cognitive biases, the statement has âfamiliarityâ and âfluency.â Youâve cheered a thousand times before for statements that begin with: This bill is needed because… Such statements are easily cognitively processed.
Elaborate Arguments Hide Mistakes
If you need âintellectualâ firepower for your bias, Dubal and other experts are ready to assist. In her essay, âRegulating the Gig Economy is Good for Workers and Democracy,â Dubal presents elaborate arguments:
Poverty is not a suspect classification under our Constitution, but it is an affront to life and dignity and to democracy more broadly. With the evisceration of the U.S. welfare state and the judiciaryâs deference to political outcomes in the area of âeconomics and social welfare,â employment is the primary legal and political means to address economic inequality. In turn, employment isâfor better or for worseâkey to our democracy. It provides access to the tools for basic sustenance in modern America: the minimum wage, health insurance, safety net protections, and even the right to organize and collectively bargain. Our capacity to participate in life and partake in politics, depends, in no small part, on our employee status. In the words of political theorist Judith Shklar, âWe are citizens if we âearn.ââ To this observation, I might add that we are citizens if we earn enough.
If you are a true believer like Dubalâconcerned about an âalarming trendâ of âthe use of app-based technology to proliferate work outside the regulatory framework of âemploymentâââperhaps like Dubal you shed tears of joy that politicians passed a bill you believed would save democracy and solve the problem of inequality. Huzzah! If heaven is reached by having good intentions, surely your ticket has been punched.
Reading carefully, though, we see that the interests of the gig workers were buried under Dubalâs many other concerns. Perhaps gig workers such as Rebecca Lawson and Andi Loveall mean nothing to those who want to expand the role of government. Perhaps Dubal told herself she was helping the gig workers, while her ideology sought to expand the role of the government at the expense of gig workers.
Being smart is no protection against foolish ideas. We can expect to hear more elaborate arguments from smart people, justifying the worker status bill mistake. As Robson observes:
Intelligent and educated people are less likely to learn from their mistakes, for instance, or take advice from others. And when they do err, they are better able to build elaborate arguments to justify their reasoning, meaning that they become more and more dogmatic in their views.
In other words, dysrationalia needs to be defended. When we think we are smart, Robson explains, we ârationalize and perpetuate our mistakes, without recognizing the flaws in our own thinking.â The result is âbuilding âlogic-tight compartmentsâ around our beliefs without considering all the available evidence.â
Robson offers an antidote to dysrationalia:
Besides cognitive reflection, other important characteristics that can protect us from the intelligence trap include intellectual humility, actively open-minded thinking, curiosity, refined emotional awareness, and a growth mind-set. Together, they keep our minds on track and prevent our thinking from veering off a proverbial cliff.
Dysrationalia is not limited to progressives, nor is it limited to politics. We ignore the intelligence trap at our own peril.
In his 1710 essay, âPolitical Lying,â Jonathan Swift wrote,
Falsehood flies and the truth comes limping after it, so that when men come to be undeceived, it is too late; the jest is over, and the tale hath had its effect.
Swift gives as an example âa physician, who hath found out an infallible medicine, after the patient is dead.â
Californiaâs gig economy is suffering from the consequences of dysrationalia. The âmedicineâ in this case is a repeal of a law that is already putting many out of work. No elaborate arguments are needed. Before the gig economy in California is dead, what is needed is a large dose of humility to admit a mistake.
Barry Brownstein
Barry Brownstein is professor emeritus of economics and leadership at the University of Baltimore. He is the author of The Inner-Work of Leadership. To receive Barry’s essays subscribe at Mindset Shifts.
This article was originally published on FEE.org. Read the original article.