Time for the Bah Humbug Awards

I usually wait a few more weeks to write my annual “Bah Humbug” post, but I haven’t the patience to wait this year. My first shout-out goes to the myriad of firms that claim to be doing “sustainability.” The purported recipient of their corporate largesse, Mother Earth, has not noticed the “gifts.” Maybe it is because their efforts to lessen the impact of the goods and services that flood the market can’t keep up with their drive to sell evermore of the same goods and services.
My second “Bah Humbug” goes to the advertising agencies and public relations firms that come up with the empty and misleading rhetoric these firms use in getting out their self-serving messages.
Third, I point to the scorers that claim to be able to distill the “attractive” features of products, companies, schools . . . into a single number that captures the essence of their performance. I notice that [GoodGuide](http://www.goodguide.com/), one of my targets in the past, has “improved” its methodology by generating ratings on an absolute scale. Transparency, the ease which the data Good Guide uses in calculating the scores, is now an important factor. I would be less inclined to single them out if their own process used to calculate the rating were itself more transparent. I found the amount and intricacy of the information provided on their webpages opaque and very difficult to understand, even for someone with the technical training I have. They are more up front in talking about the subjectiveness of the ultimate ratings.
> In order to provide our users with actionable, easy-to-understand guidance, **GoodGuide provides a single summary rating for a product, derived by giving equal weight to Health, Environment and Society sub-scores** (emphasis in the original).�Rational people can disagree over the relative weight to give health vs. environment vs. social impacts and there is no objective, correct solution to the problem of how to aggregate such disparate concerns.� GoodGuide opted for equal weighting because we believe Health, Environment and Social considerations should be integrated into all consumer product decision-making. Users with different preferences can select products based only on the sub-score they care most about.�
The weighting issue is not as simple as the above paragraph appears to indicate. The equal weighting is essentially a cop-out. The real choices fundamentally involve trade-offs, balancing the “score” in one category against others. Goodguide offers a filter to set your own weightings, but I wonder how many understand that and use it? The three choices–omit, critical or important–are much too general to provide the measure of precision that reporting the scores to two significant figures, e. g. 7.5, implies.
Another factor that went into my admittedly completely subjective and arbitrary (at least I admit it) scoring system was the main headline on the home page, “ Find safe, healthy, green & ethical products based on scientific ratings.” The four categories used–safe, healthy, green, and ethical–are never absolute. I do not believe one can make ethical judgments based on a scientific evaluation. The reification of qualities, like green, and the subsequent quantification simplify and mystify the real issues involved with health, environment, and society, the three categories making up the score. I also noticed that the website shows off sponsored ads, highlighting some of the products they rate. Without suggesting any connection between the ads and the ratings, the situation is very much like that where medical school professors are paid to test the drugs of a particular firm. At least the sponsors are transparently visible, but I found the presence of the ads jarring.
The next Bah Humbug goes to Walmart for the duplicity I wrote about in my last blog post. Walmart’s PR says how much it cares about people and the planet, but the company’s
lobbying activities shows that it cares more about profit. The triple bottom line is like the GoodGuide system; its meaning depends entirely on the weights given to each of the three categories. Walmart is an easy target, but only one of many companies that do the same thing. Shame on you all.
I’m just warming up, but maybe only a couple more today. A Bah Humbug award to all the climate deniers, especially those we have entrusted to govern this country and to those who are usurping the roles that our elected officials are supposed to play. These are the tycoons and plutocrats that sit behind a curtain, like the Wizard of Oz, and pour so much money into the political coffers that those who we entrust become know-nothings so that they can claim that there is no need to do anything. Unfortunately, the deniers of climate change have gotten so good at operating with their heads in the sand or other dark places that they cannot see the how badly the ship of state is listing and leaking from stem to stern.
Finally today, an award to folks that should be on my list of positive contributors but are fooling themselves and the rest of us in the process by holding on to the belief that the market can work if only we could undo all the various generic market failures. Giving everybody perfect information is the goal of every reporting initiative and every scoring system. Bah Humbug. True, this might work if the Smithian ideal of consumer sovereignty held true in today’s lopsided market place. My colleague and friend, Ron Nahser gave a lecture at Marlboro a week ago and pointed to a few classic statements that were simply restatements of consumer sovereignty. Adam Smith, J. M. Keynes, and Peter Drucker all said that consumer/customer satisfaction is the purpose of production and the overall economy. Maybe so, in theory, but customers are misled and seduced by advertising. Satisfaction, thanks largely to Walmart, has become equivalent to finding the lowest price at the expense of all other qualities. Walmart, by driving out local merchants, limits the choice available to buyers. Market purists would say that is how the system is supposed to work, creating economies of scale so all can benefit by lower costs. Bah Humbug.
If you have other candidates for this annual award, please send then to me by commenting on this post. I will publish them after the end of the year.