Belmont Club

Paying for the Black Helmet

When a politician wants to shade the truth or, not to put too fine a point on it, decides to tell a lie, he often hires a public relations consultant to help him do it. But an ethical expert on the art of the lie, if he has his client’s best interests at heart has a duty to inform him of the costs of falsehood.  It may be surprising to realize that lying carries with it an unavoidable cost. The most obvious is the cumulative cost of keeping up the lie.


Eric Bana, in an interview with TV show Craig Ferguson, provided one of the clearest examples of the price of lying. Bana explained he did not dye his hair out of fear of becoming hostage to the dread Black Helmet, which is “the thing that men get when they decide to cover their grays,” Bana said.  Nothing could be worse than wearing an unchanging slab of black hair as one grew older.  The price of keeping one’s hair youthful isn’t the price of a bottle of dye, it is the cumulative effort of keeping the rest of the face in sync with the Black Helmet as the visage beneath it ages.  That effort increases with time until it finally becomes prohibitive. Keeping reality from showing through the facade of fakery is a full time job.

It ultimately proved too much for Senator John Edwards, who found himself consumed by the increasing cost and effort of maintaining a fiction. The New York Times described the “spectacular rise and fall” of a man who once campaigned to be the President of the United States, now a prisoner in his own home, a victim of his own bottle of sexual hair dye.

a federal grand jury in nearby Raleigh is investigating whether any crimes were committed in connection with campaign laws in an effort to conceal his extramarital affair with a woman named Rielle Hunter. At the same time, Mr. Edwards is moving toward an abrupt reversal in his public posture; associates said in interviews that he is considering declaring that he is the father of Ms. Hunter’s 19-month-old daughter, something that he once flatly asserted in a television interview was not possible.


Still hoping for a cabinet position in the Obama administration, Edwards first sought to contain the secret, by asking “two of his wealthy patrons, through a once-trusted Edwards aide, [to provide] Ms. Hunter with large financial benefits, including a new BMW and lodging, that were used to keep her out of public view.” But the secret wouldn’t stay hidden; and by the end he was a pariah, his career was in ruins and truth was out anyway.

The cost of lying, according to Tobias Lindquist of Stockholm University, “increases with the size of the lie and the strength of the promise”. A classic example of “the bigger they come, the harder they fall” is Bernie Madoff; or if you are inclined to institutional examples, Fannie Mae and Freddie Mac, which everyone knows were “too big to fail”. There may be even more striking examples about, but this is not the place to talk about them.

But even if the liar is not caught, the very prize he seeks to obtain is cheapened by the falsehood. It’s not poetic justice, its economics. In a classic economic paper called “The Market for Lemons” the economist George Akerlof explained why used car lots had such a bad reputation. Buyers eventually factored the commercial patter of used car salesmen into their decisions and discount much of what they hear.

There are good used cars and defective used cars (“lemons”), but because of asymmetric information about the car (the seller knows much more about the problems of the car than the buyer), the buyer of a car does not know beforehand whether it is a good car or a lemon. So the buyer’s best guess for a given car is that the car is of average quality; accordingly, he/she will be willing to pay for it only the price of a car of known average quality. This means that the owner of a good used car will be unable to get a high enough price to make selling that car worthwhile. Therefore, owners of good cars will not place their cars on the used car market. This is sometimes summarized as “the bad driving out the good” in the market. “Lemon market” effects have also been noted in other markets, such as used computers and the online dating “market”. …

The paper by Akerlof describes how the interaction between quality heterogeneity and asymmetric information can lead to the disappearance of a market where guarantees are indefinite. In this model, as quality is undistinguishable beforehand by the buyer (due to the asymmetry of information), incentives exist for the seller to pass off low-quality goods as higher-quality ones. The buyer, however, takes this incentive into consideration, and takes the quality of the goods to be uncertain. Only the average quality of the goods will be considered, which in turn will have the side effect that goods that are above average in terms of quality will be driven out of the market. This mechanism is repeated until a no-trade equilibrium is reached.


A lying political culture does not become the playground of “The Best and the Brightest”; rather it becomes the Market for Lemons, the province of slick mediocrity. One reason there are so many shady men in politics is that the honest men avoid going into it. The ethical consultant of the lie should remind his client that lying, while advantageous in the short run, is like a drug, temporary in its effects; requiring higher and higher doses to maintain the same effect and is finally self-destructive. In that way he can hand his customer the pipe of dreams with a clear black heart. But alas! The supply of ethical spin doctors may be declining. If the media specialists and political consultants are unable to admit the truth about lying even to themselves then the sad stage is reached when there are no honest crooks left to keep the honor of the underworld.  Then they become the people they’ve been waiting for; and the medium becomes only the massage.

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The truth shall set you free

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