So the economic analysis of law has had many good ideas. It’s had one great idea — like, world-transforming idea, I think. And the idea is, when you’re stuck, minimize the sum of the costs of decisions and the costs of errors. Now, that is not gripping stuff. But it’s profoundly true that if you don’t know what to do, figure out either a meta-rule or a particular decision that makes error costs low, meaning the number and the magnitude is small, and that makes decision costs low, meaning you don’t have to drive yourself crazy.

And we intuitively, I think, minimize the sum of error costs and decision costs when we decide how to handle a menu, whether it’s for, you know, a meal tonight or whether it’s for what kind of car to buy where it’s kind of equivalent of a menu. So minimalism, if it is to be defended on the judicial side, the background kind of theory is, it helps minimize the costs of decisions, costs of errors.

If you decide this affirmative action case and not every one, then you’re not going to be decisionally overwhelming to yourself if you’re a court. And more fundamentally, you’re not going to produce tremendous errors for the future. And that’s a common risk for judicial decisions, whether the question is the power of the president or the right to privacy. You can blunder terribly if you get away from the particulars of the case. And this has something to do with what judges’ informational inputs are — they’re limited.

Now, in terms of nudges, they have the same feature. They’re not always the right way to go. Sometimes you have an option of not doing a nudge, and you shouldn’t. And sometimes you have an option of doing a mandate like “Forbid murder” — that’s good.

But the analysis of nudges — when they make sense — it’s that they are decisionally less burdensome to produce, and the costs of error are lower because if you screw it up, people can say, “You know, you’re giving me some information about the caloric content of brownies and hamburgers. Thank you very much, but I like that brownie and the high-calorie hamburger. That’s my dinner tonight.”

COWEN: Instead of nudging people, what if we just pay them to do the right thing? Is that better? Worse?

SUNSTEIN: It depends on the costs of decisions and costs of errors. You could, if you want to encourage people to save more — there’s first the question whether that’s a good idea, but let’s stipulate — .

COWEN: Right, but say it is. Just pay them more.

SUNSTEIN: In Denmark, economic incentives have had significantly less effect in promoting savings than automatic enrollment. There’s every reason to believe that in an area that isn’t, you know, hugely important but isn’t trivial — that is, paper usage — if you have a double-sided default for printing, an institution will save much more money than if it jacks up — than if the price of paper is jacked up.

Often a little nudge changing the default rule, giving some people some information, will have a very significant effect on behavior, more so than tax incentives or other economic incentives. And that’s good, by the way, partly because on the cost side it’s much less; you’re not sticking the taxpayers with anything. On the other hand, there are some domains where incentives have a bigger effect.

We have evidence that taxes for cigarettes have a big impact in reducing smoking. I think presumptively that’s a very good idea — 480,000 Americans die every year; if we can cut that number, that’s a good thing. Whereas the warnings we now have on cigarettes seem to be less effective than increasing the incentive not to smoke.

COWEN: Let’s take a concrete example from real life: Jedi mind tricks. Obi-Wan comes along and says, “These aren’t the droids you’re looking for.” And what does the stormtroooper do? He goes away. Now, is that a nudge?

SUNSTEIN: No, it’s a form of manipulation. So — .

[laughter]

COWEN: OK, but how do you draw the metaphysical categories? It seems like a nudge that just happens to work all the time.

SUNSTEIN: OK. I’ll give you a quick and dirty way of getting at that. Many social scientists make a distinction between System 1, which is the intuitive, rapid processing of the brain, which sees maybe a large dog and thinks, “Oh my gosh, I’m going to get bitten,” or feels turbulence in a plane and says, “We’re all going to die,” and System 2, the more deliberative system which says, rightly, upon seeing a large dog, “This might be my best friend, and the likelihood of being bitten is super low,” and if the plane starts shaking, System 2 in the brain thinks, “Planes shake, and they hardly ever crash.”

Manipulation, we can say as a first approximation, is when the agent is appealing to System 1 and not appealing to people’s deliberative faculties. When Obi-Wan says — and we’d have to watch it in very slow motion to see exactly what’s happening. But when Obi-Wan says, “These are not the droids you’re looking for,” Obi-Wan is not appealing to the deliberative faculties of the stormtrooper. A nudge — .

COWEN: Let’s just say we follow David Hume. How much do people ever deliberate? When I do things — when I’m driving, I can end up in places I don’t even recall having driven. What I choose to eat, how much I eat — it seems 98 percent of my life isn’t deliberated. So does that really shrink the realm of nudge, then?

SUNSTEIN: No, because a nudge can be a System 1 nudge or a System 2 nudge. And whether — OK, so if it’s a System 2 nudge, it’s by definition not a form of manipulation. So, if there’s a reminder or a warning or a fuel economy label that tells you how much the car is going to cost to operate, then there’s no risk of manipulation.

If people are given a graphic warning that, let’s say, shows a smoker who has lung cancer, then there’s a discussion to be had about whether it’s manipulation. I think this is a way into the topic of manipulation.

Probably we have to say something like, if one person is appealing to another in a way that wholly bypasses deliberative capacities, there’s at least a risk of manipulation. It might be justified, all things considered.

The nudges that seem to me to be appropriate in a democratic society are either nudges that appeal to people’s reflective or deliberative capacities or that don’t exploit or inflame solely people’s non-deliberative capacities. If you’re doing that, then you owe them some stuff, one of which is publicity about what you’re doing.

On photographic warnings for cigarettes — that was preceded by a public comment period, completely transparent. There’s evidence that when there are graphic warnings for smokers, smokers actually know better, not worse, about the actual risks of smoking.

So it gets kind of complicated. But the simple bottom line is, Obi-Wan Kenobi is a great hero of the galaxy a long time ago, far, far away. Still a great hero. That moment was an act of manipulation.

On the best nudger in the galaxy

COWEN: If you were to pick one character from Star Wars who would nudge you — you get to elect them; you’re the only vote. Even Samantha doesn’t get a vote, just Cass — not your children — which character would you pick? Whom would you trust with that nudge? It’s a universe full of Jedi here, right?

SUNSTEIN: Yoda.

COWEN: Yoda?

SUNSTEIN: I trust that guy.

COWEN: But I worry about Yoda.

SUNSTEIN: I trust him.

COWEN: It seems to me Yoda is always wrong.

[laughter]

COWEN: Here’s what someone online wrote about Yoda. Let me just read. “Episode V and VI,” I quote, “Basically every single word of advice Yoda offers Luke is dead wrong. In the end, Luke was right and Yoda was wrong. There was still good in Anakin, and the death of Palpatine came about because Luke ignored his advice.

“Yoda was also wrong about what to do at the end of Empire Strikes Back. Episode I — Yoda refuses to believe that Maul was a Sith, and he refuses to allow Anakin to become a Padawan until it is confirmed there were Sith about. Then he totally changes his mind, and he badly mishandles the crisis on Naboo.

“Episode II — Yoda not only takes the bait and jumps into the trap of taking the clones to rescue Anakin and Obi-Wan, therefore starting the events leading to the death of all the Jedi and the start of the worst war in millennia,” dot, dot, dot. You sure you want to pick Yoda?

[laughter]

SUNSTEIN: Yoda had it all figured out.

[laughter]

SUNSTEIN: So it looks like he made a lot of bad decisions, but he knew, you know, “No pain, no gain,” and it all works out. Hooray, Yoda.

COWEN: He doesn’t tell Luke who his father is, right? He could’ve — he could’ve said that.

SUNSTEIN: Yeah. Another way to put it is that — I think you’re onto something actually very deep about the movies, which is that Yoda is nominally the wise person, but he makes a kind of fundamental error, which is, he thinks that detachment is good and attachment is bad. He’s the kind of Stoic or Buddhist figure in the movie, to which obviously the saga is deeply drawn.

But the Buddhist and Stoic view is defeated in the end. Attachment wins out. That’s what brings balance to the Force, because Anakin can’t bear — and he’s called Anakin, by the way, in the script for the first time after he saves Luke by killing the emperor and being in his death scene. Then he’s called Anakin again.

And it’s attachment. It’s attachment that restores him. So Yoda’s deeply wrong. I was just thinking about — you know, if the question is financial wisdom or food consumption or exercise, I don’t want to ask Luke or Leia or Han. If you ask Luke — I can’t even understand what R2-D2 is saying, and C-3PO is just going to get all anxious on me, so Yoda’s my guy.

COWEN: If you ask Luke, you’re going to get a weird chaste kiss with your sister, right?

[laughter]

SUNSTEIN: Yeah. Yeah. Yeah. And it might be not that chaste, and I love my sister, and — let’s change the subject.

[laughter]

On President Obama’s “colossal blunder”

COWEN: So, let’s take a question or two about Star Wars. I take it you’ve seen these movies. Your book is now number one on the Washington Post best-seller list. It’s on other best-seller lists. Every day I see it covered.

President Obama is also a Star Wars fan. What can you tell us about the President and Star Wars?

SUNSTEIN: Well, I can tell you a few things. First, I did have an opportunity to talk to him when I was working in the White House about many subjects — cost-benefit analysis, the relationship between regulation and economic recovery, issues involving regulatory reform and small business. And I didn’t once talk to him about Star Wars.

But very recently, post-book, I did talk to him about Star Wars. He doesn’t have a lot of time to talk at length about Star Wars, but we did talk about Star Wars. And what I’d say is a couple things.

First, Article II, Section 1 of the Constitution protects executive privilege.

COWEN: Sure.

SUNSTEIN: It’s kind of a foundation of the separation of powers, and that protects him from disclosure of anything he may or may not have said in private about Star Wars.

[laughter]

But I will say that he said publicly something which — I’m going to make a little news tonight. You know, I worked with him for four years, and people who work under the President, I think, have an obligation not to break with their former boss publicly. And I haven’t done that, but I will now. The President said that A New Hope was the best of the Star Wars movies.

COWEN: Number four.

SUNSTEIN: Number four. And that was a colossal blunder on his part.

[laughter]

COWEN: And the best is?

SUNSTEIN: And the best, of course, is The Empire Strikes Back. And I do feel that the President has superb judgment and has done many excellent things. But I’m kind of getting my mind around the fact that this person, my boss — how could he have made that level of mistake?

The President said that A New Hope was the best of the Star Wars movies…and that was a colossal blunder on his part.

COWEN: So, he’s hope and change, and you’re a darker vision of history, actually.

[laughter]

SUNSTEIN: Well, I’m wondering if that’s the nature of the disagreement. I think hope and change of the New Hope sort, whatever your political affiliation — you know, Senator Cruz is a big Star Wars fan; Donald Trump is a Star Wars fan. People who don’t like, you know, President Obama’s policies love Star Wars.

But I think that The Empire Strikes Back just is a better movie. So, if you like dark movies or light movies, The Empire Strikes Back is one of the great movies of all time. It’s probably the greatest movie of all time. A New Hope is a superb movie, it’s probably the second-greatest movie of all time, but The Empire Strikes Back is better.

On the Star Wars prequels

COWEN: Let me tell you a bit of my views of the prequels, and then you respond. I think they’re strongly underrated. Lucas was a genius. He broke with his previous mold. They’re fundamentally movies about institutions that drop with the idea of following simple personal narratives. And number one, especially, is the story of how youth grows into seeking power. And they’re deep and profound and highly original.

So from my point of view, the worst episode — seven aside, which is not even part of the canon — the worst one is number six, Jedi, which is too redemptionist, too many Ewoks, a little too cuddly. It’s a very good Disney movie. And the most underrated episode is number one. But I take it you have different views, so you tell us how you see the different pieces fitting together.

SUNSTEIN: I agree with a lot of what you said, but there’s one thing you said which is the level of colossal error of the President’s in saying New Hope is the best. And that is, you said three is the worst of the movies. And that is — forgive me, that’s a colossal error, not because — .

COWEN: Who said three is the worst?

SUNSTEIN: You — didn’t you say three? No, six is the worst.

COWEN: No. Six is the worst.

COWEN: Six is the worst, Return of the Jedi.

SUNSTEIN: Six is the worst, you said. OK. So, six is — when you said it’s the worst — I’m going to disagree with the idea that it’s the least good. But the only answer to the question “Which is the worst of the Star Wars movies?” is, there is no worst Star Wars movie. There — one might be the least amazing and fantastic, but there’s none that is the worst of the Star Wars movies.

COWEN: And which is that?

SUNSTEIN: So, with that pedantic point — so, let’s get to the fundamentals. I think you are right in saying the prequels are underrated. And we need a movement — you may have just started it — for the revival of the prequels as an object of admiration. And the reason I think they deserve admiration is, you know, multiple. One is just your point that they boldly go where — I won’t finish the sentence.

COWEN: Nor will anyone go there again, I think.

SUNSTEIN: They boldly don’t do as the standard movie of this kind does, focus on individuals. There’s individual stuff, but it’s about institutions. And they have something to say about both how people go bad — and here I think it does get deep, especially about a little boy who loses his mother and then his loved one, who was much older and in some ways a mother figure. That’s extremely interesting, I think, psychologically. And he kind of loses her, too. And it’s the threat of loss that gets to him. I think that’s super interesting.

And there’s something very similar that happens with the Republic. So, the institutional failure of a squabbling legislature leading to interest in a strong paternal leader — that’s mirrored in the democratic process as it is in the individual life. And that’s great.

Also, the visual imagination of Lucas in the prequels, I think, is unimpaired. Indeed, it exceeds the first three in terms of release. They’re fantastic. So, I think that’s completely true.

I want to say a word in favor of Return of the Jedi, which you’re describing as the least fabulous of the six.

COWEN: Of the — fabulous, yes.

SUNSTEIN: I would say The Phantom Menace is probably the sixth-greatest movie ever made, but it’s also the sixth best of the movies, which is to say the W word. It’s the least good of those movies.

But Return of the Jedi I think is terrific. And the reason it’s terrific is, the redemption scene is a triumph, where what Lucas did in the original trilogy was to borrow on Joseph Campbell’s idea of the hero with a thousand faces. Many myths and religions have an arc of a hero, and Lucas described Campbell as “my Yoda.” And that was his model.

But there’s a twist here that involves freedom of choice and redemption concretized in the idea of a father whose life course had been dedicated to terrible things repudiating that life course and choosing to save his child because he can’t bear that loss.

And that scene is, I think, one of surpassing beauty, where Vader, now called Anakin, says, you know, “Let me see you with my own eyes.” And Luke says, “But you’ll die,” takes the mask off, and Luke says, “I can’t leave you. I have to save you, Father.” And Anakin says, “You already have.”

COWEN: I think you’re more of a sentimentalist than I am.

[laughter]

COWEN: But let me get to what I view as our point of deepest disagreement in all of political philosophy, and then you respond to it.

If I ask myself, “What are these movies as a set really about?” to me the core message is how hard it is to exercise freedom of the will, and that evil is both stronger and more attractive. The central character is Darth, who is mostly evil. There’s some redemption at the end, but he never sets things right. He just stops there from being further destruction.

Even in Episode VII, there’s a terrible amount of murder. Nothing is set right in the galaxy. Episodes I through III, which we both admire — they’re all the Darth story.

Luke ended up doing voices for children’s cartoons. Even Han Solo is a bit of a scoundrel. And if you look at Anakin, right, he becomes Darth, the evil guy. He gets Natalie Portman. Luke kisses his sister once and is sent to live in some netherworld that looks like New Zealand, and then he looks like he has an opioid addiction. And that’s good.

To me it’s all about the potency of evil. And that’s why Lucas picked the Leni Riefenstahl scenes for Episode IV when it’s the triumphant rebels coming at the end. It’s taken from Nazi cinema, right? We all know that.

So I have this deep and dark view of them. And then it’s not surprising I would find Return of the Jedi, number six, to be the weakest and really admire Episode I. Now, you totally disagree with that and consider that to be absurd. So tell us what you think.

SUNSTEIN: I don’t consider it absurd.

I think one of the, you know, sources of awesomeness in these cartoonlike, improbably awesome movies is that an interpretation like the one that you offered is eminently plausible, and there’s material there that justifies it. And let me say a little bit in favor of your interpretation and then say why, in the end, it’s not mine.

William Blake said of the greatest religious poem, I think, in the English language, Paradise Lost — said of John Milton roughly this. He said, “The reason Milton wrote in fetters in speaking of God and Heaven, and at liberty when speaking of the Devil and Hell, is that he was a true poet and of the Devil’s party without knowing it.”

Now that’s a “wow” sentence. It’s about Blake’s — I don’t think this was Blake’s considered view — but Blake’s flirtation, let’s say, with the view that Satan runs away with Paradise Lost because a true poet is more Dionysian than Apollonian. And the kind of wild System 1 eroticism or something of Darth Vader or Satan is ultimately what is sublimely powerful. Something like that.

COWEN: Yes.

SUNSTEIN: That’s in your interpretation of the movies. I don’t see it that way. And I think George Lucas kind of got a little bit at why I don’t see it that way. He said in one interview, long after the original trilogy — I think long after the prequels, too — he said, “Every one of us has a choice of being a hero every single day of our lives. We can treat somebody with dignity and kindness or not. We can be a decent person on that day or not.”

And I think that kind of somewhat innocent and earnest thinking — that you are at a crossroads, you can go one way rather than the other — is basically the authorial voice behind Star Wars.

So, it may be that you’re turned off. And I don’t love the Ewoks so much, and the — you know, the way they — a little too cutesy. I agree with that.

But the idea that Luke — ok, so, I think this is one of the most powerful lines in, let’s say, popular culture in American history. “I am a Jedi, like my father before me.” That’s extraordinary. And what’s extraordinary about that is the statement is, “My father, the worst person in the universe, is a Jedi.” And that is claiming the goodness and non-Sithness of the father.

Ultimately, Luke makes it true, that the Jediness of Vader is redeemed in the end. And that’s where I think the movies in the end come down. But they do go to the dark side, so that’s why I think what you say has plausibility. They don’t, in the end, honor it.

On the moral lessons of Star Wars

COWEN: Have Episodes I through III made you more libertarian?

SUNSTEIN: I’d say writing the book has made me more libertarian.

COWEN: And how so?

SUNSTEIN: I mean, not in a way that’s fundamentally different from how I’ve been. And so, Nudge — the title for Nudge — we were committed to calling it Libertarian Paternalism. I don’t think anyone would have bought that book, but it shows that it’s — .

[laughter]

COWEN: Two unpopular words put together somehow still remain unpopular.

SUNSTEIN: But the idea that unless you’re really confident, you should let people go their own way, whoever you are — I think that’s part of American culture. And that’s — you know, that’s an essential part of American culture.

What writing the book has made me focus on maybe more is the deep truth to the fact that each of us all the time faces a crossroads. And either for welfarist reasons or for reasons of respect for dignity — and these are, you know, we could have an incompletely theorized agreement — whichever one is our foundation, to let people choose their own path is — that’s the right idea.

What writing the book has made me focus on maybe more is the deep truth to the fact that each of us all the time faces a crossroads. And either for welfarist reasons or for reasons of respect for dignity …whichever one is our foundation, to let people choose their own path is — that’s the right idea.

Now, that’s not different from what I’ve thought before, but it kind of focuses it a little more. What is it — it puts it in a little more — the font size of those sentences is a little larger in my head than before.

COWEN: One thing I find striking in the dark reading of Star Wars is that it introduces the notion that maybe slavery is almost bound to be a constant throughout history. If you look at the portrait of droids, how they’re treated, it’s quite grim. And they may be sentient to varying degrees.

There’s slavery throughout the Empire. It feels quite natural. We’re not in any way supposed to approve, but it forces us to reface the question: If there’s been slavery throughout most of human history, and we’re seeing this alternative world where slavery reemerges in an ugly, horrible way feels quite natural, does that sell you more on this dark vision of history and therefore confirming your favoritism for Episode V? Or are you back with this president guy and the, you know, the Hope and Change stuff?

SUNSTEIN: [laughs] I think the arc of history is long, and it bends toward justice. And I think that’s what the Star Wars message is. You know, the dark side is in the human heart. And chaos is very troubling for an individual or for a culture, which can lead you to authoritarian leaders. But the arc of history is on the right side. I believe that.

COWEN: And should Luke have completed his training in the Dagobah system? Take that as the central moral dilemma of Episode V.

SUNSTEIN: No, he made the right choice because of the future.

COWEN: So the nudgers were wrong.

SUNSTEIN: Well, one nudger.

COWEN: Obi-Wan and Yoda, right?

SUNSTEIN: Yeah, they were wrong.

COWEN: They were telling Luke, “Complete your training.” And he’s like, later, “Ben, why didn’t you tell me?”

SUNSTEIN: Thank God for libertarian paternalism, that Luke has a choice. The Sith, by the way, like the Jedi, respect freedom of choice. In the crucial scene in Episode III where the question is whether Anakin is going to save the person who would be emperor, he says, “You must choose.” And so there’s full respect for freedom of choice. Nudgers have that. Good for them.

COWEN: Bad guys always tell you the deal, and then they say, “Choose evil.” It seems the good guys always mislead you.

There’s this funny tension. Star Wars makes me more nervous about nudge. I’m not like this huge anti-nudge guy, but when I look at Obi-Wan and Yoda lying to Luke — “Ben, Ben, Ben, why didn’t you tell me?” How many times have I heard that in these movies? Is it an advertisement for that?

SUNSTEIN: It’s fair to ask whether Obi-Wan and Yoda had it right.

COWEN: Sure.

SUNSTEIN: OK, so, one view is that they kind of completely knew what they were doing.

COWEN: And they’re like Straussians, right?

SUNSTEIN: They had second-order stuff going on — and you know, superficial people like you and me, we kind of need to get in back of it to see the deep logic. And it all worked out, and they knew it. But on nudging, the point is, if there’s a website, it’s going to nudge. If there’s a cafeteria, it’s going to nudge. If there’s a rental car office, it’s going to nudge.

COWEN: Everything but a Sith.

SUNSTEIN: Well, a Sith nudges, too. It’s just a Sith doesn’t in this respect, a Sith doesn’t coerce. It’s a little like Dr. Faust, that your soul — you get to decide whether your soul is saved. The Sith agree with that.

On nudging in general, the fact that we can find bad nudgers, which is very true, attests to the importance of having either free markets which discipline bad nudging — so we have choice architecture, you know, much more often than not in a market society, which is in consumers’ interest — and having democratic controls on government nudging, such that if the people hate it or the government’s going in a direction that doesn’t make much sense, the democratic safeguard will kick in.

On things under- and overrated

COWEN: We have a section in all of these chats. It’s called “overrated or underrated?” I toss out some items, people, whatever. You’re free to pass on any of these if it’s not appropriate. Number one, overrated or underrated, the United States Constitution.

SUNSTEIN: Underrated.

COWEN: Underrated. Tell us why.

SUNSTEIN: Well, it’s been the foundation for probably the greatest experiment in democratic self-government in the history of the world. And there’s grave difficulty in overrating something that’s done something like that.

Whether the Constitution is, you know, a set of specific prescriptions, or whether instead it’s a framework for a society which has changed radically from 200 years — there’s disagreement about that — but whatever it is, underrated.

COWEN: If the Supreme Court had to be only three people or fifty people, which of those numbers would you prefer?

SUNSTEIN: Fifty.

COWEN: You seem to like eight, right, because minimalism.

SUNSTEIN: Fifty. Fifty.

COWEN: Fifty. More diffusion of power.

SUNSTEIN: Because — yeah. With three, there’s too great a risk that it’s going to go off half-cocked.

COWEN: The original television show Star Trek. Overrated or underrated?

SUNSTEIN: Underrated. Great.

COWEN: And what’s the difference in — think of Star Trek and Star Wars. They’re alternate growth models, right? What’s the key economic variable or political variable that differs to get you one result rather than the other?

SUNSTEIN: Meaning to go in — ?

COWEN: Is it replicators? Dilithium crystals? How good human beings are?

SUNSTEIN: Oh, the economic variable.

COWEN: Who nudges whom? Like, why do you get these two parallel worlds? What’s the comparative statics?

SUNSTEIN: I think the answer is that there’s a technological something that Star Trek captures, and there’s nothing quite like that that Star Wars gets at.

Whether it’s a little — I think it’s a little thing. It’s so small you can’t even see it — we, of course, haven’t discovered it yet — that produces replicators and ships like that. That’s what they got, and in Star Wars they didn’t. And so, the universe looks fundamentally different.

The only reason I’m hesitating a little bit here is the Millennium Falcon was able to do the Kessel Run in less than 12 parsecs. And no way the Enterprise gets there — 27 parsecs, probably, maybe more. And so there is a technological advantage. I’m struggling with this question.

COWEN: Here’s an easy one, then. James Joyce, overrated or underrated? Now, they’re watching back home, so be careful.

SUNSTEIN: I think that — yeah, yeah, Irish family. I think underrated. Ulysses is arguably the richest novel in the last 150 years. Not the greatest, but the richest.

COWEN: Richest in what sense?

SUNSTEIN: That it’s just full of multiple interpretations that aren’t an interpolation of a smart reader but are actually there in the material. So, there’s stuff from Irish history, stuff from the Bible, stuff about men and women that are, you know, extremely surprising and variable from one chapter to another.

COWEN: Now, I’m going to read forth a quotation. It’s actually a theory of regulatory reform. You’ve worked in this area. You tell me if it’s underrated or overrated. This is from Master Yoda. And I quote: “Try not. Do or do not. There is no try.” For regulatory reform, overrated or underrated?

SUNSTEIN: Overrated.

COWEN: Tell us why.

SUNSTEIN: You’ve got to try. I mean, if it’s deregulation or economic incentives or information strategies, try and test.

COWEN: Not do?

SUNSTEIN: Well, you can’t just sit there and try and stare at your Federal Register notice. You have to — you know, if the question is, “Do you regulate the airwaves in some respects or deregulate transportation?” you do, but there has to be an experimental attitude, which Yoda’s words aren’t capturing.

COWEN: But Yoda got the airlines right.

SUNSTEIN: He — well, it seemed to work out, in the sense that we didn’t see a lot of inadvertent crashes by the Jedi.

COWEN: But you wouldn’t — you wouldn’t do a Yoda for workplace safety, is what you’re saying.

SUNSTEIN: I think, try. What I’m picking up on in Yoda’s — I mean, you could read it in a way such that it’s compatible with what I’m saying.

But it seems to have — OK, so, there’s work — in fact I’ve coauthored an article on this — on action bias, which says, when you’re stuck in a tough situation, either an institution or an individual, do something. Don’t just stand there; do something. But that’s often a mistake. You might want to strike when the iron is cold. Wait. Have a chance to think.

I think Yoda — maybe that’s a headline to a more convincing account than Yoda was able to give in the confines of the movie.

COWEN: He’s the guy you chose to nudge you. Keep that in mind, right?

SUNSTEIN: Yeah, but if a question is my investment portfolio or my diet or my exercise regimen — .

COWEN: But not your regulatory reform?

SUNSTEIN: Well, I think I have more experience with regulatory reform than Master Yoda. Forgive me, Master. But on that issue, not deferring to you, Master Yoda.

COWEN: So, he’s a master, you’re a grand master?

SUNSTEIN: No, no. He’s a master who has a few pockets of limited experience.

COWEN: What’s the most underrated Bob Dylan album?

SUNSTEIN: That’s a great question. I’m going to say The Freewheelin’ Bob Dylan. And it’s a bit of a risky choice because people don’t think it’s bad. It’s in the top seven, probably, and some people would put it in the top five.

It has a terrible title, The Freewheelin’ Bob Dylan. The Freewheelin’ anyone — that would be a terrible title. There’s no one — The Freewheelin’ Han Solo. That’s awful. There’s no one for whom that’s a good title.

Bob Dylan — whatever he is, he’s not freewheelin’. He’s, you know, complicated, or mischievous or something, or troubled. But the title wrong-foots you. But I think that’s his greatest album, actually, and so it’s underrated.

On government, academia, and Gary Becker’s biggest mistake

COWEN: How did your time in government change your view of academia?

SUNSTEIN: I concluded that academics, including people like me, were in important respects clueless, and I did not think that before. I did feel as admiring, or even more admiring, of basic research by academics that produces knowledge or fresh ideas that can be put to use. But having studied administrative law for more than two decades, I was amazed by how steep my own learning curve was in an area that I thought I knew well.

So, I had written about — and I don’t mean to single myself out for opprobrium here. I, like many administrative law professors, write about stuff, and just the absence of a sufficiently thick understanding of how things happen — that really surprised me.

On the other hand — that’s the not-so-good side of academia, I think. Works about actual practical things — it’s often insufficiently informed. But if anything, as I say, the idea that you can go on the National Bureau of Economic Research website, as I did in government and do now, and find out stuff about what programs are working and what not in way that has a kind of rigor that outruns anything you could find in the newspaper or generate in a conversation in government.

That, I felt — I almost feel like it has a purity, almost like a religious purity, some of the work that academics do. And that’s one of the things I was — I had a glow. Everyone who leaves the White House, I think, has a glow when they leave. Part of my glow — and this is probably unique — was that I was getting a little more sleep, but also that I got to go back to that stuff, maybe do some empirical work, and figure out something that might be true and wasn’t known yet.

COWEN: What was Gary Becker’s biggest mistake?

SUNSTEIN: His biggest mistake was his greatest virtue, which was an unfailing commitment to the rationality assumption. I love Gary Becker as a person and as a scholar. You know, he’s in the pantheon. But his insistence on human rationality was both what made him as fantastic as he was but also led him astray.

So, I’ll give you a term for it. It’s actually recently invented by Matthew Rabin, a behavioral economist. The term is “explainawaytions.” And the term means, suppose you have a situation where people, let’s say, value a coffee mug that they’ve been given more than a coffee mug that their neighbor has been given. That’s an anomaly, that there’s an immediate increase in value once you get the thing.

An explainawaytion might say something like, “Well, there’s transaction costs in trading,” which is desperate. It’s an explainawaytion. It’s not an explanation.

And Gary Becker was, both in his writing and even more in person, a master of the explainawaytion, where he’d come up with some account which had surface credibility, so he could say it, but nah.

On the hidden assumption behind Sunstein’s work

COWEN: You’ve written a lot of different books. That’s your view of Becker. My guess is there’s some unity to those books. What do you yourself see as the semihidden metaphysical assumption behind all or most of them that most readers don’t see, but if you sit down and think real hard about it — I don’t mean that you’re trying to hide it from people, but it’s hidden, in the sense that only after writing them all have you seen that it’s there. And what is that assumption?

SUNSTEIN: I’d say that it’s a form of consequentialism that is very much focused on, “How will one or another thing make human lives better?” There’s some work on political science and law on legitimacy, as if that’s a master value.

And, you know, my work doesn’t focus so much on legitimacy. Maybe that’s a mistake. But if you look at things on behavioral economics or about nudging or about freedom of speech or about the problems with echo chambers in the Internet world or minimalism, it’s — regulation, certainly — it’s, “What will make people’s lives better?”

And this may seem kind of sentimental, but I hope it isn’t. If you’re thinking about a highway safety regulation — this was my view in government and my view now — to think about, you know, what does some subcommittee of Congress think, or what’s the Left going to think, or what’s the Right going to think, or even something about some abstraction is probably not as good as thinking, “What are the actual human consequences of doing that? Are you going to save one life or 80? Are you going to adversely affect little businesses which are trying to grow, or not?”

COWEN: This is relative to individual preferences.

SUNSTEIN: Well, I would not be preference-fixated. I think preferences are a very good clue to what is going to promote people’s welfare.

COWEN: But what adjudicates preferences versus the other stuff you want to count?

SUNSTEIN: Well, I’ll say at this point, related to our discussion of incompletely theorized agreements, John Rawls had a footnote in a book — he never published the footnote — which said, “We post a signpost: ‘No deep thinking here. Things are bad enough already.” I love that. [laughs]

John Rawls had a footnote in a book — he never published the footnote — which said, “We post a signpost: ‘No deep thinking here. Things are bad enough already.” I love that.

I’d want to be very clear on the particulars. If people have a preference, let’s say, for something that clearly truncates their life significantly, like they want to, you know, drive super fast, let’s just stipulate in a way that’s not going to endanger others — it’s just on a track — that’s their preference. To deem that sovereign is not clearly correct. It might be that they’re making their lives, you know, shorter in a way which on reflection, by their own reflective lights, is not a good idea.

And that’s a pretty stark example. But with respect to smoking, I mentioned the 480,000 deaths per year example. Each one of those — that’s the number — but each one of those people is a human being. And probably everyone who’s listening to this knows at least one — I know two — who died of lung cancer. And the preference for smoking — that’s not something that we want to be careless about.

Now, I wouldn’t want to forbid smoking. That would be too coercive, but some efforts to educate and nudge to try to help people not die — that’s okay.

COWEN: But, like, in most pluralist theories I tend to think there’s an underlying metaphysical assumption used to perform aggregation. So, banning smoking is too coercive. It’s not obvious to me why that is correct. I mean, most people feel that way, but we ban plenty of other drugs, and that’s not too coercive.

There’s some mix of costs and benefits. There’s a lot of things people eat which are bad for them. We don’t do much about that. And in the scale of preferences, autonomy, well-being, liberty — again, what’s the final principle ruling these tradeoffs? That’s like the hidden metaphysical assumption of Cass Sunstein that I want to get at it.

SUNSTEIN: OK — you’re right. OK, great. I think you’re completely right that the claim that it’s too coercive — to ban smoking — that’s a conclusion in search of an argument. And the shorthand is that the welfare consequences, all things considered, of a ban would be negative, but that would have to be earned rather than just asserted. That’s my view, but I haven’t given you data to support it.

So, what I’d like to do at every difficult point is to be able to say that whatever your metaphysical assumptions, you will be able to go in a certain direction that will be compatible with — let’s call it nonsectarian welfarism.

Now, if you push me to talk about liberty — that liberty is an ingredient in welfare, meaning being able to go the direction that you want is welfare-promoting for the people who are exercising their freedom, that’s one point.

And the other point is the Millian point that there are multiple contexts, at least, let’s say — we don’t want to make a theology of this, as I think Mill sometimes almost did — but we want to acknowledge that people know, you know, by and large, in acknowledging the behavioral biases better than third parties, what will make their lives go better.

So, to see liberty as an ingredient in welfare because of its exercise and to see it as a heuristic for what’s actually going to promote welfare — those are both good ideas.

On the benefits of a banned products store

COWEN: Let me tell you what I love about nudge and see if I can pull you into greater love of nudge.

SUNSTEIN: Even greater.

COWEN: Even greater. Take the products today which governments ban, but put aside nuclear weapons and violent products. We should unban them and, as my colleague Robin Hanson suggests, put them all in a store called the Banned Products Store. And the government will spend a lot on big signs: “These are bad for you; don’t buy them.” There will be all kinds of negative advertising, but the store will be there.

We’re going to nudge people a lot not to buy these products, but in fact we could move from current bans and mandates to having them available, but lots more nudges. So I want maybe more nudges than you do, or is that not true? Are you the nudge critic?

SUNSTEIN: No, no, you may be right, but we’d have to think of what the thing is, and then we’d have to do — .

COWEN: Everything banned that’s not violent. Heroin, cocaine — .

SUNSTEIN: Well, I worry with respect to heroin — not being an expert on heroin, but I worry that it is nearly instantaneously addictive and extremely tempting to a wide range of people in different life circumstances. To be a heroin addict is really, really rough.

COWEN: Sure.

SUNSTEIN: To nudge people and not to take the step we’ve now taken might leave, you know, a lot of tragedy around. Now, it is true that the heroin ban does not eliminate heroin, and it has ancillary consequences that aren’t good. But I would say with respect to some product — let’s say it’s a food where there’s a 1/x chance of death from consuming it, and x is not that high a number — to say to people, you know, “You can have this. Note that your death risk is 1/x.”

Why is it so great to shift from banning the thing to allowing people to have it when you’re going to see a lot of bodies on the streets?

COWEN: Say I’m dying of a terminal disease, and there’s a treatment. It probably won’t help me, but there’s a one-tenth of one percent chance that it will. And I want to use it — it’s kind of a self-defense argument. And I say, “Well, self-defense — that’s like a minimal value we all would agree upon.”

I love nudge. Let’s take the FDA out of the picture and just put it in the Banned Products Store and have big huge signs, bad music surrounding it — disco, whatever we need to do — telling that it’s not any good, but let me buy it. So, I want more nudge than you do.

SUNSTEIN: OK, you might. But I’m open to these ideas. In a case where someone has a terminal illness, and there’s a drug that has an extremely low probability of working, there’s a good argument that on welfare grounds they should get that because the chance of death without that, let’s stipulate, is a hundred percent, and the chance of despair without that is also a hundred percent. So if people’s tastes are such that they want to spend their money on a very small risk of living, it’s plausible to say that’s in the store, your store.

COWEN: Yes. Now, you’re intrigued by the John Stuart Mill–Harriet Taylor correspondence and also by Byatt’s novel Possession from the early ’90s. I think you once said it was your favorite novel. What is it that ties those two together, and what explains your fascination with them?

SUNSTEIN: OK, so Possession — .

COWEN: What does it say about you?

SUNSTEIN: [laughs] Maybe I’m a romantic.

COWEN: Sentimental. They’re both letters. There’s something dialogical about them.

SUNSTEIN: Yeah. OK. I’ll tell you, for those who don’t know Possession, go read it tomorrow. I think — it’s my personal favorite novel in any language. I can’t say it’s as rich as Ulysses, but I like it even better, and in terms of greatness I would rank it with Joyce.

What makes it, I think, so fantastic, and what gets to me about it is — and you’re correct — the letter exchange between the two lovers. And I think, for one thing, their alertness to the particulars of their own hearts and the particulars of their lover’s hearts. The ability in each of them to be kind of fundamentally in touch with what they themselves are most deeply about and what the person they love is most deeply about — that is, in those letters, I think, overwhelming. And what Byatt gets at — and I think this is what gets to me about it — probably none of us has the literary quality of the two protagonists in Possession, but every one of us has that inside ourselves, and we just see surfaces.

Even of our friends, we just see surfaces. But there’s stuff going on in them about — you know, it can be needs or fears or loves that are just inaccessible, but there’s an inside to everybody that has what Byatt gets in the protagonists. I think that’s completely phenomenal.

Now with Mill and Taylor — I wasn’t particularly interested in Mill and Taylor. I was interested in Mill as one of the great thinkers and Taylor as a very important figure and maybe a great thinker. But I wasn’t interested in their relationship until I saw that the University of Chicago Press was issuing, in its great Hayek series, Hayek on Mill.

And that seemed to me intriguing beyond belief. What would Hayek write about Mill? Two of the great liberal thinkers who are very different — but Hayek on Mill is not really Hayek on Mill; it’s Hayek’s edited edition of the Mill–Taylor correspondence, essentially.

And Mill and Taylor had a correspondence one to the other, much of which I think is destroyed, that has some of the delicacy and — I’m struggling for the right words here — what is that? Seeing the particularity of persons, the preciousness of persons and lives.

Mill and Taylor both do that. And some of those sentences, one to the other — I think they’re not quite as great as Byatt’s protagonists, but they’re really something. And when Taylor says something about how she felt when Mill left one day — and you know, we don’t even say that to each other, to people we love. To our spouses, maybe sometimes we don’t say it, but we feel it.

And Hayek, who seems, you know, both one of the great figures in liberal thought but also a cold fish — I think he seems like a cold fish. So, he’s kind of — as I respond to your question — he kind of had all that stuff in him, clearly. Why would he have gotten into the Mill–Taylor correspondence, this guy who writes about the uses of knowledge in society and the rule of law, which is — that’s great stuff, but it’s not about how it was when you left that day. But he completely got into that, so I like that, too.

COWEN: Last question, before Q&A — this is in a way about nudges. But even in the last two years, you’ve published quite a few books. I’ve lost track, myself. And normally when we have someone in for one of these chats, we pile up all of the papers they’ve written. But today we’re in Washington, DC, there are height restrictions on the buildings.

[laughter]

COWEN: So, in lieu of those papers, we have Yoda, Darth, and an Imperial walker. Those legs on the walker the were not properly regulated — that’s why they fell over so easily. So, you’ve done all this. It’s obvious from reading your book, you spend a lot of time with your children. Time management — how do you do it, and what’s your advice? How do you nudge yourself, or who nudges you?

SUNSTEIN: If — well, I have a four-year-old daughter, she just turned four. And if I don’t deliver pages to her at night — she goes to bed around 8:30 — she’s really mad. She says, “Daddy, what did you write?” And this is completely false; I’m making it up. She doesn’t have any need that I write pages. But I guess I feel every day that if I haven’t written at least something or had an idea, then I haven’t quite done my job.

Most days I feel that. I have to write something. And if I have a week or two weeks where I haven’t made a little progress on something that is potentially an academic article or a book, I feel, “Pedal-to-the-metal time. You’ve got to produce something.” So, I have kind of an internal superego or something about writing. I also really enjoy it. I have no writer’s block, but I will write a lot of stuff that no one will ever see because it’s too terrible.

COWEN: So we only get the tip of the iceberg?

SUNSTEIN: You’ve got the — my filter is probably not sufficiently rigorous, so you probably see too much, but I do have a filter. There’s a lot of stuff that I — so I tried, like “There is no try. There’s do,” but there’s also experimenting. So, there — I’m working on a book on liberty. I’ve been doing it for a few years, and I have 90,000 words, and I don’t like what’s there. I hope something will come of it. But just the advice would be — you are a living practitioner of this — is if you have something to say, write it.

And then think, “Is it worth showing to the world?” To be too critical of your own production, I think, is — at the early stages, at least — is an error. Be critical — if it’s a book or an academic article, be really hard on yourself late. But early, just assume it’s good.

To be too critical of your own production, I think, is — at the early stages, at least — is an error. Be critical — if it’s a book or an academic article, be really hard on yourself late. But early, just assume it’s good.