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Have you looked at the psychology of decision making when poor and struggling? It might open your eyes as to why people don't make the optimal choices (financia

Have you looked at the psychology of decision making when poor and struggling? It might open your eyes as to why people don't make the optimal choices (financially or others). And a lot of people literally do not know any better. They've never had someone teach them how to manage money and potentially had bad role models growing up. So its easy for you to say, with the knowledge it seems like you have, this is what you need to do. It's much harder to put into practice. Especially when you consider there are many folks that do manage their money well, don't splurge on non-essentials, work multiple jobs and still cannot make ends meet.

gruez 5y ago
> Have you looked at the psychology of decision making when poor and struggling? It might open your eyes as to why people don't make the optimal choices (financially or others). Where does "psychology of decision making when poor and struggling" stop and personal responsibility begin? Can every suboptimal decision be excused because of "psychology of decision making when poor and struggling"?
- baq 5y ago
  You’ve got some reading up to do on behavioral economics. Humans (real ones, not model economic actors) can’t and don’t make optimal decisions except in very special circumstances.
  - gruez 5y ago
    That doesn't answer my question at all.
    - baq 5y ago
      Of course. Never meant to, just pointed to a direction that you seem to be unaware of.
      - gruez 5y ago
        >Never meant to, just pointed to a direction that you seem to be unaware of. What gave you that impression? In my initial comment I acknowledged the concept of excusing suboptimal decision making due to "psychology of decision making when poor and struggling". How is that different than what you're saying?
        baq 5y ago
        You call it 'excusing'.
        gruez 5y ago
        That seems like the right characterization to me? Definition from wiktionary: >3. (transitive) To provide an excuse for; to explain, with the aim of alleviating guilt or negative judgement. Earlier in the thread there was definitely a tone of negative judgement. ie. "people show up all the time with a litany of complaints and a litany of awful, awful budget mistakes they have no interest in fixing"
        baq 5y ago
        Negative judgment is exactly what is off mark. Real humans make mistakes. No whys or buts or excepts. They just do and they shouldn't be blamed for what is essentially being human. IOW people can't be reasonably expected to make rational, self-interested choices. (It's actually amazing this is almost a Nobel-prize worthy observation in economics. This is psychology 101.) If you ask why or what kinds of mistakes they make, now that is where the books go deep. Suffice to say those mistakes are not unpredictable and people can be nudged to make a better (dare I say correct) choice.
        gruez 5y ago
        >Negative judgment is exactly what is off mark. Right, but I'm not the person giving the negative judgement. I specifically recognize the possibility of "excusing" them (ie. not negatively judging them) in some cases, and ask whether they should be excused in some cases or all cases. After this long conversation it appears you believe in the latter. Is this correct?
- medvezhenok 5y ago
  If you were put in that position and stripped of all of your privileges, you would also be likely to make similar decisions (not exactly, but we can observe given medians). That's why we need a UBI - to give the poor people leverage. We saw it a bit with the unemployment bonuses - companies are having to raise their wages finally and are complaining about it, and we might finally see inflation. Every keeps treating it like a bad thing, but in reality, the late 70s with high inflation were the most "equal" times historically, since inflation with wage indexation is actually more akin to a wealth tax on the rich, which I totally support.
- LocalPCGuy 5y ago
  There is a difference between "explaining" and "excusing". There is a level of personal responsibility that needs to happen. But we also, as a society, need to understand the reasons that people make sub-optimal decisions and work to provide valid ways people can learn to make better ones. I'm not excusing individuals making poor decisions, but rather trying to find the explanation for it in a non-judgement fashion. I'm not accusing you of this, but in my experience, the people who preach "personal responsibility" often do not take the time to understand the issues preventing people from making good decisions, and so aren't even working on the right problem in many cases. And in saying that, please be aware that I do feel there is a place for personal responsibility and it's an important factor in anyone improving their situation. Just not the only factor needed.
Viliam1234 5y ago
> They've never had someone teach them how to manage money This. If you don't know how money works, most people who offer advice are just trying to scam you. But not taking any advice is also not helpful. If I knew how to invest in index funds 20 years ago, who knows, I might have already been halfway to retirement. Before I had kids, I was able to save a large part of my salary. But everything I did with the money -- following the advice of people pretending to be experts -- only made the money disappear. If someone has a friendly person who spends a day or two helping them set up the system, so that all they need to do later is send extra money to a specific account once in a while, it can change their future dramatically. But many people do not have such friend.

gruez 5y ago

> Have you looked at the psychology of decision making when poor and struggling? It might open your eyes as to why people don't make the optimal choices (financially or others). Where does "psychology of decision making when poor and struggling" stop and personal responsibility begin? Can every suboptimal decision be excused because of "psychology of decision making when poor and struggling"?

baq 5y ago
You’ve got some reading up to do on behavioral economics. Humans (real ones, not model economic actors) can’t and don’t make optimal decisions except in very special circumstances.
- gruez 5y ago
  That doesn't answer my question at all.
  - baq 5y ago
    Of course. Never meant to, just pointed to a direction that you seem to be unaware of.
    - gruez 5y ago
      >Never meant to, just pointed to a direction that you seem to be unaware of. What gave you that impression? In my initial comment I acknowledged the concept of excusing suboptimal decision making due to "psychology of decision making when poor and struggling". How is that different than what you're saying?
      - baq 5y ago
        You call it 'excusing'.
        gruez 5y ago
        That seems like the right characterization to me? Definition from wiktionary: >3. (transitive) To provide an excuse for; to explain, with the aim of alleviating guilt or negative judgement. Earlier in the thread there was definitely a tone of negative judgement. ie. "people show up all the time with a litany of complaints and a litany of awful, awful budget mistakes they have no interest in fixing"
        baq 5y ago
        Negative judgment is exactly what is off mark. Real humans make mistakes. No whys or buts or excepts. They just do and they shouldn't be blamed for what is essentially being human. IOW people can't be reasonably expected to make rational, self-interested choices. (It's actually amazing this is almost a Nobel-prize worthy observation in economics. This is psychology 101.) If you ask why or what kinds of mistakes they make, now that is where the books go deep. Suffice to say those mistakes are not unpredictable and people can be nudged to make a better (dare I say correct) choice.
        gruez 5y ago
        >Negative judgment is exactly what is off mark. Right, but I'm not the person giving the negative judgement. I specifically recognize the possibility of "excusing" them (ie. not negatively judging them) in some cases, and ask whether they should be excused in some cases or all cases. After this long conversation it appears you believe in the latter. Is this correct?
medvezhenok 5y ago
If you were put in that position and stripped of all of your privileges, you would also be likely to make similar decisions (not exactly, but we can observe given medians). That's why we need a UBI - to give the poor people leverage. We saw it a bit with the unemployment bonuses - companies are having to raise their wages finally and are complaining about it, and we might finally see inflation. Every keeps treating it like a bad thing, but in reality, the late 70s with high inflation were the most "equal" times historically, since inflation with wage indexation is actually more akin to a wealth tax on the rich, which I totally support.
LocalPCGuy 5y ago
There is a difference between "explaining" and "excusing". There is a level of personal responsibility that needs to happen. But we also, as a society, need to understand the reasons that people make sub-optimal decisions and work to provide valid ways people can learn to make better ones. I'm not excusing individuals making poor decisions, but rather trying to find the explanation for it in a non-judgement fashion. I'm not accusing you of this, but in my experience, the people who preach "personal responsibility" often do not take the time to understand the issues preventing people from making good decisions, and so aren't even working on the right problem in many cases. And in saying that, please be aware that I do feel there is a place for personal responsibility and it's an important factor in anyone improving their situation. Just not the only factor needed.

Viliam1234 5y ago

> They've never had someone teach them how to manage money This. If you don't know how money works, most people who offer advice are just trying to scam you. But not taking any advice is also not helpful. If I knew how to invest in index funds 20 years ago, who knows, I might have already been halfway to retirement. Before I had kids, I was able to save a large part of my salary. But everything I did with the money -- following the advice of people pretending to be experts -- only made the money disappear. If someone has a friendly person who spends a day or two helping them set up the system, so that all they need to do later is send extra money to a specific account once in a while, it can change their future dramatically. But many people do not have such friend.