Obama makes the 'nudge department' official and embraces the science of coercion

Last year, more students went to college and more graduates managed to make student loan payments than in previous years. If you were among these responsible citizens, pat yourself on the back… but not too hard. Your good decisions might not have been entirely your own.

Your financial maturity may have been the result of a government ‘nudge,’ in the form of a well-timed text message about college matriculation forms you needed to fill out or an email alerting you that your loan payment was overdue.

Those prompts were part of an experiment by the Social and Behavioral Science Team, a group started in February 2014 by President Barack Obama. The team of behavioral science experts are using inexpensive techniques drawn from psychology, criminology, economics and cognitive science to manipulate people into making better decisions. (They prefer the term “nudge.”) The goal is to save money.

In its first year tackling 15 government programs, the team says it ‘nudged’ more veterans into taking advantage of their benefits, more farms into getting loans, and more families into signing up for health insurance coverage. The team’s text-messaging campaign to remind low-income high school grads to fill out paperwork for colleges to which they were already accepted upped enrollment from roughly 66% to 72%.

The group’s first annual report, released this month, is basically a victory lap, saying their efforts have led to billions of dollar in economic value (calculated by adding up nudges that, for example, got people to pay their taxes and save for retirement).

Now, thanks to these early successes, the government’s ‘nudge’ department is expanding. Last week, President Obama issued an executive order directing government agencies to adopt findings from behavioral sciences in their daily operations, with the goal of “deliver[ing] better results at a lower cost for the American people.” Obama elevated the Team from an experimental novelty to an integral part of the White House and the 2016 budget.

Not everyone loves a good nudge. Critics have called the program a mind-controlling scheme. Some see hints of Big Brother, an all-knowing entity that keeps tabs on us, but over which we have no control. Public health experts have argued that nudges are short-term bandaid fixes to long-term problems that need more thoughtful solutions. Last year, critics within government voiced concern that the data might be cherry-picked to highlight successes and play down the failures of nudge programs in the U.K.

Mark D. White, a College University of New York philosopher, wrote an entire book in 2013 about the problems with nudges called The Manipulation of Choice. “It is unseemly for policymakers to use people’s decision-making flaws to manipulate them, subtly and secretly, into making choices that policymakers want them to make, rather than the ones they would have otherwise made themselves,” he wrote.

Who’s to say these fixes are always well-intentioned? The feds’ motivations behind the nudge—which work in part because they’re imperceptible—might not always be completely transparent, or have citizens’ long-term interests in mind, as Carnegie Mellon University statistician Cosma Shalizi and Elliot School of International Affairs political scientist Henry Farrell pointed out in a 2011 editorial in New Scientist. “When, for example, Obama’s administration temporarily cut taxes to stimulate the economy, it did so semi-surreptitiously to encourage people to spend rather than save,” they wrote.

Whether we like it or not, we’re going to have to get used to nudges. The Obama program is part of a larger, global push to use behavioral sciences—and big data—to get people to act in certain ways. Bad decisions are costly and we will sometimes make really dumb ones if left to our own devices. Think about the last time you deliberated between going to the gym or staying in to eat pizza and ice cream while Netflix-binging. We don’t exercise regardless of how unhealthful our diets might be, so our health suffers. We don’t save for retirement although we know that Social Security won’t cover our expenses in old age. We text while driving despite the fact we know it’s dangerous.

Employers, tax payers, or both end up paying for our irresponsible actions, all because we’re not always rational. But data is, at least in theory.

The U.S. is actually following in the U.K.’s footsteps in creating a nudge unit. In 2010, British Prime Minister David Cameron set up the Behavioral Insights Team to improve public services, while simultaneously cutting costs. The program increased the number of organ-donor signups, doubled applications to the army, helped improve password strength, and helped decrease tax evasion, among other wins, according to the most recent report of BIT’s undertakings.

For example, BIT scientists hoping to cut down on tax evasion found that the people who owed the most money were more likely to pay up after receiving messages that reminded them their taxes mattered to the community. A little guilt-tripping goes a long way.

In another project aimed at increasing diversity in a town’s police force, data showed that 40% of black and minority applicants were passing an online test assessing their judgment in different situations while roughly 60% of white candidates passed it. So in an email sent to candidates before the test, the BIT scientists added a note prompting candidates to think about why they wanted to be part of the force and what it would mean for their communities. That increased the passing rate of black and minority candidates to almost 62%.

The U.K.’s nudge unit has been so successful that in February 2014—the same month Obama set up the Social and Behavioral Sciences Team—BIT was spun out from government into a “social purpose” company to “respond with greater flexibility to the growing demand for ‘nudge’ services,” according to The Guardian. Now, it boasts the World Bank, the National Health Service, the United Nations, the Mexican, German and Singaporean governments, Bloomberg Philanthropies, as well as some local police departments, among its clients. Since the launch of the commercial company, BIT has grown from 14 to 60 employees.

What the U.S. and U.K. are doing for their citizens is something tech companies have been doing to their employees for years. Google, for example, has a team of people, dubbed the People & Innovation Lab, who focus on behavior-molding at the company. In Google’s snack-filled microkitchens, you’ll find fruit stocked in front of sugary treats, to make the caloric options slightly less accessible. That simple tactic resulted in millions fewer consumed calories.

In health care, nudging is also en vogue. For instance, an insurer will only pay for a colonoscopy if a patient gets a second opinion. Employers will give employees a gift card or lower premiums if they participate in wellness programs, with checklist-style goals like going to the gym a certain number of times per week. Sure, you can opt-out, but it’ll cost you. These types of practices go by the less trendy name “process-based benefit design.”

“They’re a way to bend the cost curve,” said Bob Kocher, an investor with venture capital firm Venrock who specializes in health care. “These are all new features that are Cass Sunstein designs.”

Sunstein is co-author of the book Nudge: Improving Decisions about Health, Wealth, and Happiness and has been advising Obama since 2009. His book jumpstarted the nudging revolution. He’s a believer that people can be incentivized to make “good” decisions under the right conditions or in the right environment.

The web is filled with so many devious nudgers there’s a whole website called darkpatterns.org dedicated to tracking some of the worst examples, like duping people into buying insurance or annoying newsletters, by using clever website designs.

Then, of course, there’s Facebook, the master nudger. The social network “knows” that if your friends are doing something, you’re more likely to want to do it too. It’s applied that logic to prod people to vote, become organ donors, and unwittingly spread sadness or happiness.

Data-driven behavioral science means figuring out the exact right way to change a particular person’s actions. It’s a power that could be used for good… or evil. Under the Social and Behavioral Science Team’s guidance, the U.S. Department of Education sent several different versions of an email to low-income people with student loans they needed to pay back. They found (surprisingly) that peopled preferred longer, rather than shorter, emails, and the Team then used that information to make sure people stayed current on their loans so their credit scores wouldn’t suffer. That’s great, but that insight could also be used nefariously by predatory companies to target low-income people with high-interest loans or exorbitant fees. Similar things have happened. Policies based on behavioral science may magnify inequality in unforeseen ways.

Transparency is important as well. If we’re going to be nudged—sometimes without our explicit consent—we should have the right to know about it. The U.K. nudge unit is now a private company meaning it’s not subject to Britain’s freedom of information acts. Keeping citizens in the dark about how they’re being manipulated or coerced by government seems like a dangerous precedent to set.

Daniela Hernandez is a senior writer at Fusion. She likes science, robots, pugs, and coffee.