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Trade-offs
If Governor Spitzer wanted to have sex with a younger woman then instead of hiring a prostitute he could have gotten a divorce and remarried, just like so many other rich and powerful men. Or he could have had an affair. Of these options hiring a prostitute is the least threatening to marriage but it's the only option which is illegal. In contrast, getting a divorce and remarrying a younger woman is so common it doesn't even stop a man from running for President.
Trade-offs are everywhere, whether we choose to acknowledge them or not.
In closely related news, Eric Zitzewitz says that although Spitzer may have hired a prostitute he was not himself for sale. Justin Wolfers reflects and like me thinks our moral compass is off kilter.
Posted by Alex Tabarrok on March 13, 2008 at 07:47 AM in Current Affairs | Permalink
Comments
Speaking of trade-offs, what I find so striking is the contrast between the second picture, in which she is actually attractive, and the third picture, which is more likely to earn her money: http://www.nytimes.com/2008/03/13/nyregion/12cnd-kristen.html?_r=1&oref=slogin
Posted by: Tyler Cowen at Mar 13, 2008 8:00:58 AM
Why don't we just legalize prostitution? Prostitutes would be better empowered and they would fare better. Their clients would pay less. Society would be more peaceful and STD rets may decline as a result of the legal market.
Posted by: Chairman Mao at Mar 13, 2008 8:33:09 AM
Zitzewitz's analysis is highly incomplete in calculating the costs and benefits of Spitzer's actions.
- Key missed benefit: increase in systemic integrity due to the examples he made of "market timers" and the firm's that harbored/encouraged them.
- Key missed cost: legal and human resource costs associated with selective prosecution and criminalization of business activities better regulated by civil enforcement.
To my mind the latter costs are more significant than the former benefits, but that's my bias about the benefits of predictability (or lack of arbitrariness) in the exercise of state power.
Posted by: M. Hodak at Mar 13, 2008 8:43:01 AM
Alex, your post reminds me of Dwight Lee's old article, "Marriages, Mistresses and Marginalism" which places the decision to have an extra-marital affair in the same category as the water-diamonds paradox.
Posted by: jason voorhees at Mar 13, 2008 9:00:28 AM
If the rules of the game require strong prosecutorial activity to keep people in line then it's the rules of the game that are not well written and should be questioned. Spitzer not for sale? Well maybe not to private interests, but surely he had sold his soul to the state. Is that any better?
Posted by: Unit at Mar 13, 2008 9:01:16 AM
Another missed cost: Spitzer's actions have cost him his career. (Whether they should or not is moot. No one, least of all the man himself, is claiming that he hired a prostitute as an act of civil disobedience. They have, and it was knowable ex ante that they very much could.)
Posted by: Cyrus at Mar 13, 2008 9:04:58 AM
"Of these options hiring a prostitute is the least threatening to marriage but it's the only option which is illegal."
It may be illegal in New York, but not elsewhere. For the kind of jack
Spitzer was spending it would have been easily affordable to transport
himself to a location where prostitution is legal. Was it indicative of
his arrogance that he did not avail himself of the opportunity to
have sex with prostitute in places where it is not prohibited? Spitzer,
we must not forget, is the guy who threw his weight around: "I'm a
f---ing steamroller . . . etc." Again, he could have cheated on his wife
with a prostitute legally, just not in New York; but why should the self
acclaimed "steamroller" have to? No it was not that the intersection of
his budget set and the legal constraints of New York conspired to make
Spitzer an unwitting victim of an unlibertine system. In spite of his
clear ability to purchase sex legally elsewhere HE CHOSE to
abrigate HIS SWORN OATH to uphold NY laws (not to mention the violation
of whatever wedding vows HE SWORE TO be true to).
And while I'm steamrolling, why is it that minimizing the "threat to
marriage" is important in the wake of infidelity (whether with a
prostitute, legal or illegal, or a partner who does it without monetary
compensation)? Marriage is a contract that people agree to voluntarily.
Whatever the legal status of prostitution, if vows of fidelity are made
then the violation of the vows are, by definition, a violation of
contract. The classical liberal position is not, I do not think, that
people are freer when contracts are more often clandestinely violated.
I don't think there would be anything to celebrate if Spitzer had cheated
his wife with a "younger women" in any case, even a legal bordello.
Posted by: indiana jim at Mar 13, 2008 9:49:29 AM
It wasn't just prostitution. His financial manipulations tripped the alarms of the anti-money laundering sysem. You need the whole story to sum up the costs and benefits.
Posted by: jorod at Mar 13, 2008 9:52:38 AM
How about the obvious? Both hiring a prostitute and having an affair mean the guy was cheating on his wife. If he does this to his wife, supposedly one of the people he loves most, why should the public at large have any trust in him?
With an affair there is still the chance that he really loves this other woman. By hiring a prostitute, he makes very clear that his personal pleasure is the only factor, and apparently more important than the people close to him. It means he's a dick.
Posted by: greatzamfir at Mar 13, 2008 9:57:49 AM
All good points Alex. Doesn't negate the fact he made a career out of prosecuting crimes, including a number of prostitution rings. Our moral compasses might be off kilter, but he made a career profiting from it.
Posted by: Mark at Mar 13, 2008 10:22:26 AM
Mr Spitzer's crime wasn't really engaging the services of prostitute. After all soliciting is considered such an insignificant crime that in some places it isn't even illegal. Mr Spitzer's real crime was hypocrisy.
There are very significant political benefits to be derived from projecting an upstanding, righteous image. Of course, as Mr Spitzer has discovered, there are very significant political downsides if the image diverges from the man.
Interestingly, a law abiding persona is not necessary for success in politics. Dana Rohrabacher (Rep, CA) has been re-elected nine times despite quotes like, "I did everything but drink the bong water". Of course, this might not have been so popular if he had been standing for attorney general.
Posted by: Deepish Thinker at Mar 13, 2008 10:40:44 AM
"If he does this to his wife, supposedly one of the people he loves most, why should the public at large have any trust in him?"
So, since John McCain admitted to repeatedly cheating on his first wife and mother of his children, should the public have no trust in him? Or, as the article implies, do we have different standards for different types of adultery (and/or different politicians)?
Posted by: A student of economics at Mar 13, 2008 10:47:35 AM
Finally. Something on which I can agree with Alex. What an oddly prurient country we live in.
Posted by: martin at Mar 13, 2008 10:52:41 AM
Concur with the above who say the real problem is his hypocrisy. In my ideal more-libertarian world, prostitution would be legal, and who sleeps with who under whatever consensual conditions is their own business. But I can still respect someone who cracks down on prostitution in the honest conviction that it is damaging to society and no one should ever do it. However, once that same person is exposed as wanting to hire prostitutes for himself, his integrity is shot.
Posted by: Kat at Mar 13, 2008 11:35:54 AM
"Men such as those in Spitzer's position do not so much pay for women to have sex with them; they pay for women to go away AFTER having sex with them," said evolutionary psychologist David Buss
An affair has a different kind of maintenance cost and logistics than going to a prostitute, although as frequently as Spitzer went to the escort service, and the paper trail of his escapades grew, perhaps there was a point in time when he should have switched to a mistress.
Posted by: bronxilla at Mar 13, 2008 11:44:04 AM
Or is it possible that sexual behaviors do not follow a strict rationalistic cost-benefit analysis?
Posted by: Slugger at Mar 13, 2008 12:37:08 PM
Regarding Wolfers' analysis, it's interesting to speculate what Spitzer may have been selling.
For instance, Spitzer prosecuted some other prostitution rings at the same time he was patronizing the Emperor's Club - one would assume this gave the Emperor's Club more market share and allowed for higher pricing for customers and lower payments to its employees. It's interesting to speculate what, if anything, may have caused Spitzer to focus on those other prostitution rings while leaving the Emperor's Club to service its constituency.
Posted by: CJS at Mar 13, 2008 1:23:18 PM
One reason prostitution (and soliciting) remain unlawful is the influence of female voters who are or wish to become wives and regard prostitutes as competitors for males' time and resources. Prostitution is not an appealing career for most women-- they would rather be wives.
Wives and prostitutes are partial substitutes. Wives sell large amounts of time at low hourly rates and provide sexual favors of steadily declining value. Wives demand payment in time and attention, not just cash.
Prostitutes sell small amounts of time at high rates and provide sexual favors of high value due to novelty. Prostitutes accept cash compensation, allowing men to spend time on activities they value more than squiring women around or listening to them prattle.
Since married women have a residual claim on their husbands' assets, wives don't want husbands spending any money on prostitutes. Unmarried women who wish to become wives need to entice suitors by offering sexual favors, but since such women wish to trade sexual availability for "commitment," they would rather not compete with prostitutes who will trade sexual favors for mere cash.
Laws forbidding prostitution just represent rent-seeking by other women. Such laws are like those which forbid people to braid hair without a "cosmetologist's license" that requires 1,600 hours of "training" in things like eyebrow plucking. Wives and would-be wives don't want prostitutes selling unbundled sex.
Two kinds of societies legalize, or at least tolerate, prostitution: those in which women have little political power, and those which adopt socialist/feminist institutions that substitute State support for husbands.
Posted by: Vorpal Blade at Mar 13, 2008 2:04:01 PM
The biggest meltdown in history is happening after "The Sheriff cleaned up the town." Thank God he was taken down before he could capture the Presidency.
Posted by: anon at Mar 13, 2008 2:04:19 PM
Vorpal Blade wins the "most obnoxious and cynical" award for loveless and misogynistic use of economic reasoning. Hopefully it was a joke.
Posted by: liberty at Mar 13, 2008 2:58:37 PM
This is a joke, from another message board:
But I’m not sure you people appreciate the various forms and nuances of “The Spitzer.” You’ve got the “Flying Spitzer,” which, I’m told, can be quite exhilarating. There’s the “Spitzer Blitzer,” but at least one of the participants must have a beard for that........hopefully the male participant. Then there’s the “Rusty Spitzer.” Kinky. There’s the “Half-Spitzer,” which is better than nothing if you’re on a budget I guess, but most people find it quite unsatisfying. There is, of course, the classic “Full Spitzer,” which is referred-to pretty much universally simply as “The Spitzer.” You don’t mess with a classic. There’s the “Spitzer-and-a-Half,” which some think is not really worth the extra money, and then there is the rarely observed “Double Spitzer,” which everybody should probably experience at least once in their lifetimes, just so they can say they have. There are, of course, stories of a “Triple Spitzer,” and many experts consider it to be nothing more than urban legend, although one Ms. Rose Pilgerfahrt of Mundelein, Illinois, claims to have performed it on two occasions with some unspecified Baldwin brothers, whilst vacationing in Los Angeles.
Posted by: bronxilla at Mar 13, 2008 3:07:01 PM
Notwithstanding my previous comments, I have to disagree with "liberty" that Vorpal Blade's post is nothing more than a cynical joke. Vorpal's detached scientific approach, complete with testable predictions, is certainly more than cynical (and/or misogynistic if you like) goofing.
Posted by: indiana jim at Mar 13, 2008 3:14:53 PM
indiana jim,
detached scientific approach? If that is what science is these days, we have some serious problems.
You have what I see as absurd assumptions:
1. "Wives sell large amounts of time at low hourly rates and provide sexual favors of steadily declining value."
Underlying assumptions: (a) Net income flows from man to woman
(b) net sexual favors flow in the opposite direction, (c) sexual favors decrease in value over time, (d) sexual favors are given not for intrinsic value to both parties but in exchange for the monetary value of the income flow
2. "Wives demand payment in time and attention, not just cash."
Underlying assumptions: man doesn't enjoy giving time and attention to woman, or enjoy the value of the attention given him, but does it in exchange for sexual gratification or other contractually based exchange value.
There are probably more. Now, some marriages may look like this, but I feel horribly sorry for both parties involved, if they do. Despite stereotypes, some couples actually are in love and enjoy each others company; women like sex; women sometimes contribute more financially to the marriage; etc. The assumptions are sad and bigoted, and it is a lonely man who wrote it. (Or at least someone playing one).
Posted by: liberty at Mar 13, 2008 3:37:43 PM
"Since married women have a residual claim on their husbands' assets, wives don't want husbands spending any money on prostitutes."
Ah, that's why wives don't want their husbands to visit prostitutes.
Someone's read too much economics, and interpreted it too narrowly.
Posted by: LemmusLemmus at Mar 13, 2008 3:49:15 PM
liberty,
There are testable implications; if the implications don't hold up, THEN we reject the refuted hypotheses. This has always been the scientific approach, to my knowledge.
As Armen Alchain discussed, it may be that successful businesspersons behave "as if" they were attempting to maximize profit, regardless of whatever statements they might make suggesting otherwise. The "as if" is the thing that lots of people seem to miss in hypotheses like this.
Posted by: indiana jim at Mar 13, 2008 3:57:55 PM
