Whistle-blowing on and off the equilibrium path 
Tuesday, August 6, 2013
Daron Acemoglu and James Robinson

The verdict in the Bradley Manning trial and the ongoing travails of Eric Snowden have kept whistle-blowing in the headlines.

Their critics and detractors focus on whether Manning and Snowden were seeking publicity and fame, and on the supposed damages to US reputation. They also claim the information they revealed wasn’t a big deal. Nor did it confirm the worst fears of those critical the US government’s security policies.

But this all seems to miss the point about why whistle-blowing is socially useful.

In economics, it is often important to distinguish behavior on and off the equilibrium path. Certain actions, which would have otherwise arisen, are off the equilibrium path because of the reactions or the punishments that they would trigger.

The truly useful role of whistle-blowing may be what we don’t see, the off-the-equilibrium path behavior of the US and other governments. What we see is bad enough. But without the threat of whistle-blowing, by albeit perhaps fame-seeking, flawed adventurers, much worse might be taking place.

If so, what we see on the equilibrium path might be the type of whistle-blowing that looks mundane and perhaps self-serving. But it may be precisely this sort of whistle-blowing that discourages even worse violations of privacy and more malicious cover-ups by the alphabet soup of US agencies not clearly accountable to anybody.

And what about the supposed damage to US reputation?

If the United States really has any pretense of being a beacon of respect for democracy and civil rights, it should take pride and attempt to rectify the problems, when its citizens have the courage to break the chain of command and reveal its worst behavior.

Pres. Barack Obama got it right when he said to the media, following the scandals on Justice Department’s monitoring of Associated Press and the Inland Revenue Service’s targeting of conservative groups:

My job is to be President; your job is to keep me humble.

Even more important would be to admit that the job of whistle-blowers and the media is to keep the entire US government apparatus humble.

It’s a job we should appreciate on and off the equilibrium path.

Article originally appeared on Why Nations Fail by Daron Acemoglu and James Robinson (http://whynationsfail.com/).
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