Sanford flies high on taxpayers' dime

According to the article "Sanford flies high on taxpayers' dime,"

While running for governor in 2002, Sanford zeroed in on travel spending, criticizing Democratic incumbent Gov. Jim Hodges for “lavish spending” on airfare and hotel rooms.
“If I become your governor,” he asserted in a radio ad, “I’ll fix that problem in Columbia.”

Yet, records indicate Sanford has been spending lavishly for personal benefit at taxpayers' expense.

Absolute power corrupts absolutely? Or just another example of political hypocrisy? Does this suggest a need for political or regulatory reform?

The Economics of Adultery

In the National Public Radio (NPR) story "After Sanford's Affair, Putting A Price On Adultery," Chana Joffe-Walt explains how economists can do a cost-benefit analysis of marital infidelity:

All Things Considered, July 9, 2009 · The Republican Party in South Carolina this week voted to censure Gov. Mark Sanford for his extramarital affair with an Argentine woman but stopped short of a formal call for his resignation.

Sanford's marital infidelity may not have cost him his job, but it certainly was a costly choice.

This is the kind of human decision economists love to study. Tim Harford, author of the Dear Economist advice column in the Financial Times, points to an economic model that can help make rational sense of what's usually an emotional issue. The model appears in a paper called An Economic Theory of Extramarital Affairs (PDF) by Ray Fair of Yale, and it focuses on how much time it takes to conduct an affair.

"This must be one of the things that weighs on your mind a lot," Harford says. "And if you're a busy person, like, say, the governor of South Carolina, it's going to be very difficult to clear your schedule and make time for some quality affair."

An Expensive Proposition

The dilemma of finding time sounds familiar to Chris Proctor, a married man who admits to having had an affair. "When you're as busy as I am, it is difficult to find the time," says Proctor, a marketing representative in St. Louis.

Three years back, Proctor met a woman from Virginia at a weeklong gathering. The affair lasted for nine months. Looking back on it, he says, it was expensive. He ticks off a list of costly items.

"The cell phone plan, I hadn't planned on," he says. "So that was 60 bucks a month by the time you get text messaging; the phone calls [are] on top of that." He figures he spent up to $5,000 traveling to see his lover. "So it wasn't cheap."

Proctor started to add in other costs — a potential divorce, the cost of his kids not growing up with two married parents — and decided the affair wasn't worth it to him.

Or as Harford would say, the utility Proctor was receiving from the affair was not worth the money or the opportunity cost — that is, what he was giving up in order to have his dalliance.

The Happiness Rule

Economists tend to think about any problem or any choice in terms of preferences. You can't satisfy all your desires at once, because you've got constraints on your budget and your time. Given all your varying preferences, you'll tend to maximize your happiness. You'll rationally choose the best option for you.

People who've had affairs do talk about a measure of rational decision-making at some point in the process — just not always at the outset.

Katherine Johnson works for a law firm in Washington, D.C. She's single, but she encountered a certain married man at the gym who caught her eye. They had both lived in Indiana and hated it, she says. He asked her to lunch, and that lunch was followed by another, and another, until they were having a full-blown affair.

Johnson wasn't betraying a personal commitment of her own. The affair didn't cost her a lot of money. But she did factor in other costs.

"You can't go out on dates," she says. "I couldn't really tell my mom about this. My own integrity was at stake."

She names the benefits.

"It's exciting," she says. "The thought of it is definitely very exciting. For me, the benefit was the companionship and the camaraderie and having someone to talk to throughout the day."

Those benefits outweighed the costs for Johnson for almost a year. When that equation shifted, she ended the affair.

When Your Spouse Is Cheating

Any affair necessarily involves at least three parties: the cheater, the person being cheated with, and the spouse being cheated on. That last person must weigh his or her own costs and benefits.

Harford, the economics advice columnist, hears from this kind of person frequently. In his role as columnist, Harford adopts a persona of someone who finds all of life's answers in economics papers.

A "Mrs. F. in Oxford" might write, "I'm starting to suspect my husband of having an affair. How can I find out?"

Harford says this is a typical "information problem." Mrs. F probably knows people who know whether or not her husband is having an affair, but they don't want to be the one to tell her.

Thus she must to set up what's known as an information market. She can ask her friends and acquaintances to make bets on her husband's fidelity — and those bets should carry real financial consequences.

"She should issue a bond that would pay money if [her] husband [is] caught by a certain date," Harford proposes. "Another bond would pay money if her husband was not caught by a certain date. By looking at the price of these two bonds, she gets a sense of whether there are people out there who think her husband is betraying her."

Obviously, Harford's idea sounds crazy. His plan is also, perhaps, brilliant. It seems to strike people as absolutely one or the other.

Economics is helpful in lining up the rational, measurable benefits of cheating. Proctor says if he had listened to his internal economist, he probably would have determined that $5,000 was more than he wanted to pay for an affair. But he didn't listen.

For politicians, the costs are huge — so much so that they would seem to clearly outweigh any benefits. But every few months, another politician offers another apology.

It may be that these precise economic models can't survive contact with the unpredictability of human beings. If only we could work the passion of X into the utility function — ah, forget it.

Is the U.S. Economic Decline Obama´s Fault?

An unsigned comment on Ben Smith's Politico story about Mark Sanford's marital infidelity is representative of the attitude many critics have toward Barack Obama:

This is a great story to chase to avoid taking about the failures of Obama's economic package. Warren Buffet declares Obama's economy is in shambles and no sign of being fixed. More and more people believe Obama will tax them to death and the coming depression is Obama's fault. Too much spending and too much taxing.

Posted By: | June 24, 2009 at 02:50 PM

Our current economic recession began in December 2007, long before Barack Obama became President on January 20, 2009. Most economists agree further decline was inevitable, regardless of who became the U.S. leader. Obama does favor higher taxes on the wealthiest members of society. Republicans, by contrast, tend to pursue policies that shift the tax burden to the middle and lower classes or to future generations. When talking in broad generalities, many people favor the reduction of government spending. Yet, few (if any) politicians publicly declare the specific government programs they wish to cut. If the American people are unwilling to support politicians who will reduce government spending, then the moral obligation to future generations is for current citizens to pay more in taxes. The author of the above comment seems unwilling to face that reality.