Encouraging Failure

Posted: Aug 06, 2012 12:01 AM
Encouraging Failure

For the past ten days, Americans have watched in awe as Olympic athletes perform feats unimaginable to us mere mortals. These men and women have trained for years – some for decades – to compete at the highest possible level and represent their country.

While competing in the Olympics is an accomplishment in and of itself, true success in London is measured in medals. What patriotic fans want and what ferociously dedicated athletes strive for are medals, more specifically, gold medals.

The athletes’ hyper-competitive spirit is why many – both here and around the world – were shocked to learn that Olympic-caliber badminton players were intentionally losing their matches. Although this doesn't appear to be a gambling-induced scandal, it is an unwelcome distraction.

Interestingly, the intentionally poor play seems to be a perverse consequence of the rules. According to the Associated Press, the women “deliberately conceded points in an apparent attempt to lose their round-robin matches to secure a more favorable spot in the next round.”

The Badminton World Federation reacted swiftly, disqualifying four women’s doubles pairs – one from China, one from Indonesia and two from South Korea – for "not using one's best efforts to win a match.” The Federation went on to say the women were conducting themselves “in a manner that is clearly abusive and detrimental to the sport."

Perhaps, but the women’s strategy was apparently shaped by the rules.

Craig Reedie, the vice president of the International Olympic Committee and former head of the badminton federation, did not blame the rules, though. Instead, he said, “sport is competitive. If you lose the competitive element, then the whole thing becomes a [sic] nonsense.” Rather than declaring the rules to be nonsense, Reedie added, “you cannot allow a player to abuse the tournament like that, and not take firm action.”

On the surface, the swift response to the allegations – and widespread condemnation –is certainly understandable. No one outside the media wants a scandal-plagued Olympics. And swift action avoids uncomfortable questions about the rules of the game.

Because what would it say about the Olympics if you could lose and still get ahead? What would it say about the Olympics if success meant more obstacles?

By now, you probably see where I am going with this.

Our increasing dependency upon government creates the same type of moral hazards that caused Olympic badminton players to lose...intentionally.

According to The Heritage Foundation, more than 67 million Americans received some sort of subsidy from the government last year. From housing, health care, and food stamps to college tuition and retirement assistance, an individual could receive benefits valued at nearly $33,000 per year.

Why would anyone chose to work a minimum wage job for $7.25 an hour when they could get what amounts to $16.50 per hour (based on a 40 hour workweek) from the government?

Need more evidence?

If you have a house on a flood plain, the government will subsidize your insurance. If your below sea-level home is ravaged by a hurricane, the government will help you rebuild. If you didn’t insure or hedge against a drought, the government will bail you out.

Call it a moral hazard. Call it culturally corrosive. Call it whatever you want. The bottom line is that America cannot afford such widespread government dependence, from either individuals or businesses.

So instead of complaining about outcomes – throwing Olympic badminton matches or living off the government dole – its time to change the rules of the game. Only then will we be able to create the incentive for people to work hard and succeed.