Simpler | Cass R. Sunstein

Summary of: Simpler: The Future of Government
By: Cass R. Sunstein

Introduction

Welcome to the world of ‘Simpler: The Future of Government’, where Cass R. Sunstein unveils the inner workings of the Office of Information and Regulatory Affairs (OIRA) and its role in shaping regulatory policy. In this compelling summary, you’ll learn about the concept of ‘nudge’, an effective tool that helps facilitate better decision-making without tampering with one’s freedom of choice. Additionally, explore the intricacies of ‘choice architecture’, and gain insights into how our cognitive abilities influence the decisions we make. By the end, you will have a deeper understanding of the thought processes behind government regulations and policies.

Revolutionizing Regulation

The Office of Information and Regulatory Affairs (OIRA) has been the proverbial thorn in the side of conservatives in the US. Created in 1980, the OIRA under the Reagan administration expanded its regulatory responsibilities. In 2009, Cass Sunstein became the administrator for the Obama OIRA and brought in his cost-benefit analysis principles, which facilitated the creation of “Regulatory Moneyball.” This regulation technique is based on data and scrutiny, avoiding gut instincts. This process involves nudging. Nudging is a gentle suggestion that does not interfere with daily life. People choose among alternatives against a backdrop known as choice architecture, which exists in every store layout and website design. Effective nudges can enhance choice architecture by offering clear explanations, revealing pertinent information, and making decisions easier. Sunstein’s OIRA aimed to make regulations less bewildering, repetitive, and onerous. Staff members based regulations on careful analysis of “behavioral economics,” investigating how people react to what they are told.

Nudging People to Make Better Decisions

The book explains how people make decisions using two cognitive systems: System 1 and System 2. System 1 makes quick and instinctive decisions which can be prone to errors, while System 2 works more thoughtfully. Governments can use functional nudges to encourage people to use System 2, which helps them focus on the long-term costs and benefits of their behavior. These nudges work best when they offer a clear and easy way forward. People make decisions based on framing, salience, loss aversion, and social influences. Regulators need to consider both systems and their phenomena when crafting policies.

Plate, Not Pyramid Approach

The US government’s efforts to promote healthful eating and control healthcare costs were unsuccessful with the initial food pyramid design. However, after modifying it to resemble a plate, the new graphic provided clarity in the path to better food consumption. The plate-style graphic ensures disclosure and satisfies three regulatory objectives: to improve performance, offer accessible facts, and gain feedback from the public. Public input played a significant role in developing measures like the Affordable Care Act and Consumer Financial Protection Bureau. Therefore, the government should implement the “Plate, Not Pyramid” approach in all its regulatory initiatives.

How Automation Helps Government to Make Things Easy for People

The effectiveness of defaults as a way of making things easy for people is discussed in this book. It is suggested that governmental agencies can streamline processes and create defaults that people opt out of, such as automatic enrollment in 401(k) plans and electronic paychecks. Defaults work because of inertia and endorsement, but they can be ineffective if people actively oppose them. In these cases, active choices may be more effective. Streamlining processes and making action simple is crucial to government attempts to create better choice architectures.

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