Politicians have been looking for ways to return moral values to British society. It’s kind of them to bother of course. Yet numerous commentators suggest that the political class’s own “moral compass” has become unstuck. This does not necessarily make politicians poor guardians of British morality—it may even give them a special expertise. All the same, it does make them suitable guinea pigs for pre-testing their own social experiments.

THE PERILS OF STATE INTERVENTION

One of the noxious side-effects of state regulation is that it narrows the scope for personal responsibility. Official rules simplify the daily dilemma facing each of us. When figuring out whether to pursue a particular course of action, rules and regulations make it unnecessary to consider the effect on others. The issue is no longer whether a particular action is socially appropriate, but whether it is allowed: in the absence of official rules, we ask “should I?” As soon as new regulations appear, the question becomes “can I?”

In this way, new rules can unwittingly legitimise behaviour that would otherwise be deemed morally reprehensible. We seem to forget that formal laws do not have the same quality and nuance as unwritten moral conventions. We allow the former to simply replace the latter. Thanks to grey areas and loopholes in new legislation, it thus becomes acceptable to pursue goals otherwise judged immoral.

This insidious dynamic is no new phenomenon, but it has grown in salience over the last weeks. It has become a central concern in efforts to regulate the global financial crisis: It’s all very well to create new rules constraining firms’ pursuit of profits, but we all know that these rules will contain loopholes. The concern is that firms will then take advantage of these loopholes in order to behave in an immoral way, legally. Governments fear that current responses to the financial crisis will do little to bolster bankers’ sense of personal responsibility or moral instincts. Indeed, by spawning novel legal loopholes, the new rules even open the prospect of a far deeper crisis in the future.

THE APPEAL OF NUDGE POLITICS

Politicians have therefore been casting around for ideas. The notion of “nudge politics” put forward by Thaler and Sunstein, a pair of US academics, is receiving attention. Thaler and Sunstein argue that governments can encourage individuals to make good choices with only the lightest of state intervention. The state’s role is to be confined to shaping individuals’ “choice environment”.

The rather indecorous parallel that Thaler and Sunstein cite involves a urinal: by putting plastic flies in pissoirs, men are encouraged to aim. No written rules or sanctions are required. The same principles can be employed in state regulation. Governments seeking to discourage smoking might, for example, create rules about how cigarettes are displayed in supermarkets. With only the lightest of touches, individuals will be steered away from smoking.

This brand of “libertarian paternalism” may have been denounced as little more than a snazzy title, but it appears to have been picked up by the British leader of the opposition, David Cameron. Cameron’s Conservative Party has long railed against the “rights culture” in evidence in the UK: the UK’s human-rights machinery and the “universalist” elements of the British welfare system have given individuals formal leverage over society without fostering a concomitant sense of personal responsibility. Nudge politics might be a way to get people to think about their social environment in a way that formal rules cannot, but nevertheless to steer their behaviour.

WHO GUARDS THE MORAL GUARDIANS?

The trouble with all this is that the political class has appointed itself as moral guardian of British society and the economy. It is they who will decide the direction in which we are nudged. And, as commentators like Peter Oborne have shown, politicians’ own moral sense has gone somewhat askew. It is not merely that the British political class displays a distinct lack of morals itself. The really dangerous phenomenon noted by Oborne is that the political class imputes its own dubious motives to society as a whole. Disgraced politicians exonerate themselves by stating that they are just “ordinary people”—of course they will behave badly if given the opportunity.

Perhaps, then, nudge politics, or whatever means are chosen boost our moral spine, ought to be first tested and refined on politicians themselves. After all, the regulation of party funding and parliamentarians’ expenses has created numerous grey areas and loopholes. Cameron has certainly stated his commitment to cleaning up his party’s practices. However, Conservative politicians already investigated have been scrutinised according to the letter of the law and not moral values. They appear ripe for a little nudging.

It’s a tempting thought, but in reality it seems unlikely. Politicians across the EU are too much enjoying gloating at the financial world. For too long, finance was seen as the first choice for intelligent and talented individuals. Politics was the resort of those whose egos outstripped their talent. The financial crisis has exposed the artifice of the finance world and exposed it to moral opprobrium. Politicians are savouring the moment. Cameron’s experiment with cleaning up his party’s moral substance will likely be short-lived: the moral shakiness of the political class has been put firmly in the shade by the financial crisis.