Nothing to fear, oh really?


altHave you signed a petition on the Number 10 website? Did you sign this one: We the undersigned petition the Prime Minister to…resign? (As of Friday lunchtime there were currently 54,672 signatures). You could be in for a surprise in the future.

In an article on Marginal Revolution, Alex Tabarrok brings attention to a recent report from Venezuela that examined the wages of the millions of signatories to a petition calling for Hugo Chavez to be removed from office. Unfortunately for them in the proceeding election, Chavez triumphed and their names were added to a database that was distributed across government agencies. The report finds that those who signed the petition and: “...were identified as Chavez opponents experienced a 5 percent drop in earnings and a 1.5 percentage point drop in employment rates after the voter list was released. A back-of-the-envelope calculation suggests that the loss aggregate TFP (Total Factor Productivity) from the misallocation of workers across jobs was substantial, on the order of 3 percent of GDP."

Whilst this specific instance may have taken place overseas it highlights that governments can’t be trusted, especially with private data. Whilst it is hard for people to imagine something similar taking place in this country, we are singularly blind to human nature, it is entirely possible. Should Gordon Brown win the next election (hypothetically speaking) there is little to stop him implementing a subtle tweak to tax credits, or the tax system that would leave the majority of the signatories to the online petition worse off. The database state is not your friend, at some point you are very likely to become a victim of a politician disposed with a weaker human nature.

Thankfully though on this occasion, it looks likely that signatories of this petition are in the majority!