Students easily understand opportunity cost. Taking a college course means giving something up. Spending $586 on tuition and $119 on a textbook to take my fall course means giving up something else — clothes, entertainment, recreation or even food.
Even those who enjoy employer education reimbursement know spending 54 hours in a drab classroom means less time at their favorite bar or in church or simply with their families. The idea that opting for one alternative inherently means giving up something else is evident in all sorts of daily decisions.
What students do not see initially, however, is the pervasiveness of opportunity cost. In an individual’s daily life, it commonly involves money and time. But it takes longer to see that the idea of opportunity cost also applies to national decisions societies make through politics. It applies to foreign policy and military decisions. And it applies to voting.
We have only 24 hours in a day. We have only a certain amount of money to spend in a month. And we only have one presidential election every four years.
Deciding what to do with scarce resources such as time, money or a vote involves weighing tradeoffs. Do we want to party with friends or get the degree? Do we want to go to Cancun or put more money in our IRA? Do we want to vote for Bush or Kerry?
There may be some individuals who agree completely with the position of one candidate. Such people are few, however. The rest of us have to weigh what is more important.
Do we want a president who wants to limit access to abortions or one who is likely to pursue a foreign policy based on traditional alliances? Do we want one who favors gay marriages or one who opposes protectionist impulses? Is a missile defense system more important than curbing carbon dioxide emissions? Do we want lower taxes or a lower federal deficit?
For some voters, one single issue is of such overwhelming importance that every other consideration pales in importance. For most of us, weighing tradeoffs is a more complex process in which we rank our own priorities on a long list of issues. We make subjective judgments about what each candidate would likely do if elected. Then we decide on the better, or least bad, candidate.
From my point of view, the choices this year are discouraging. Even so, it was not hard for me to reach a decision. A good friend has a similarly jaundiced view of the two contenders but is easily opting for the other guy. In voting, as in choosing between soft drinks, different individuals have different preferences.
Here’s another opportunity cost consideration: If our current system consistently produces nominees worse than others eliminated in the process, why is this true? What is it about our electoral laws, campaign financing or media coverage that keep thoughtful centrists from running and winning? What would we give up to change things?
© 2004 Edward Lotterman
Chanarambie Consulting, Inc.