Myopic Voters and the Samaritan’s Dilemma
One of the paradoxes of representative democracy is that policies enacted with popular support may be detrimental to citizens’ interests. Recent studies suggest that voters emphasize the short-term benefits of policies over their long-term ramifications in the areas of natural disasters, social security, infrastructure, and public debt. The consequences of voter myopia are often reinforced by the “Samaritan’s dilemma”: recipients of benefits may begin to rely on free aid instead of their own efforts. However, politicians should not be insulated from electoral pressures in order to pass laws that benefit the public at large. These may be enacted by Congress if the timing is right.
An influential study estimates that every $1 spent on natural disaster preparedness saves $15 in relief spending on average. Yet, politicians do not receive much credit for preparedness efforts such as the building of dikes and levees. By contrast, relief spending significantly increases their reelection prospects. Whereas the former yield uncertain and diffuse benefits, the latter is highly visible and usually come in the form of direct payments to voters. Consequently, politicians use disaster relief strategically for reelection purposes. Relief spending tends to increase when a disaster is closer to the upcoming election, and when the latter is more competitive.
Disaster relief programs are popular, but they may set the wrong incentives if recipients anticipate the aid. Out-of-pocket insurance expenditure is very sensitive to disaster payments, decreasing by 0.2% for every per cent increase in expected disaster payments. Anticipated disaster relief may also encourage homeowners to build in high-risk areas. To be sure, the federal disaster relief program benefits the public at large because it allows the flood insurance market to exist in the first place. However, a lot of public money could be saved by improving disaster preparedness.
Voter myopia might be inevitable in a modern democracy. Voters have limited time and resources to devote to politics, and need to focus their attention on highly visible events such as natural disasters that provide information about the incumbent’s competence. As a result, however, spending on disaster preparedness and other investment programs constitutes a collective action problem for lawmakers. That is, they are unlikely to receive due credit if the investment pays off, but they might be blamed if it does not.
An often-advocated policy solution consists in insulating decision-makers from electoral pressures. However, there is no unequivocal evidence that officials are more likely to pursue good policy when their tenure is secure. While they might be less likely to pander to public opinion in order to be reelected, the lack of electoral accountability might also discourage them from pursuing ambitious policies.
The legislative process in Congress may under certain circumstances help overcome these collective action problems. While a large number of congressional districts receive funding from federal flood preparedness programs, Members representing constituencies that are particularly exposed are likely to receive credit from voters. This might encourage Members to support investment spending bills, and partially explain why major disaster preparedness programs such as the Biggers-Waters act of 2012 are enacted with bipartisan support.
However, timing matters more than anything for the enactment of long-term investments. The awareness of flood risk usually spikes after a disaster, and then incrementally returns to its low initial level as voters forget about the events. Voter myopia allows for windows of opportunity in which preparedness programs are electorally rewarded.