Bad policy by aggregate utility

As the mathematicians in policy-making attempt to maximize societal utility in cross-section and by integration longitudinally for each specimen, one has to wonder if there are better ways to think about it. The trouble with mathematicians, engineers and economists in general is that they are too good in math but not in anything else. Such competence, albeit useful in some limited contexts, likely do not lead to good policy decisions.

Life is not a continuous function that allows integration. It shows so many Poisson jumps in both directions, any optimization longitudinally and in aggregate cross-sectionally, is bound to fail. Overlay the biases and ignorance of policymakers on top of an already bad process, you are guaranteed to get bad policies and outcomes. A simple idea that there is a significant negative skew to utility may invalidate most contemporary policy choices.

Is there a solution? Not likely in the current human state. One could imagine advanced societies where policy and decision-making are localized, dynamic and context specific. If each decision-maker is keenly aware of the negative skew to the utility function, she may make optimal decisions around her. In such a society, there is no need for centralized control nor an education of ethics. If each individual is making optimum decisions, then the achievable societal utility is likely maximized.

Humans are sitting ducks. Hopefully they are put out of their misery by a potent global pandemic or an asteroid hit.