Hurricane Katrina and the Perversity Thesis

In Albert O. Hirschman's brilliant analysis of conservative responses to progressive social programs entitled The Rhetoric of Reaction, he identifies and critiques three reactionary narratives that conservatives use to critique governmental programs -- the futility thesis; the jeopardy thesis; and the perversity thesis. The futility thesis posits that governmental attempts to cure social ills or to correct alleged market imperfections are doomed to fail because the government cannot possibly identify the problem with sufficient clarity, predict the future with sufficient accuracy, and devote resources sufficient to "make a dent" in the problem. The jeopardy thesis argues that "the cost of the proposed change or reform is too high as it endangers some previous, precious accomplishment." The jeopardy thesis thus subjects governmental interventions to a cost-benefit analysis and finds them wanting because the gains to the beneficiaries never exceed the costs to society of putting existing social arrangements at risk. According to the perversity thesis, "any purposive action to improve some feature of the political, social, or economic order only serves to exacerbate the condition one wishes to remedy." The perversity thesis is pervasive in conservative critiques of government programs. On any given day, the reader of the Wall Street Journal's editorial page is likely to find one or more applications of that thesis. Perhaps the most common target of the perversity thesis is the perennial call for an increase in the minimum wage. As the Journal's editorial page told us on August 11 in an editorial entitled "Another Minimum Wage Backfire," minimum wage increases inevitably harm the very low income workers that their supporters foolishly mean to help by providing an incentive to employers to replace low-wage employees with computers or machines.