John Rentoul: Why politicians should not be fooled into the promotion of happiness

It may be that a free market provides the best context in which happiness can thrive

Spring is here, and there is a lot of happiness about. Thanks to Anthony Seldon, headmaster of Wellington College, who wrote in The Independent yesterday about his plan to put the study of happiness on his school's curriculum this autumn. And thanks also to Professor Richard Layard, whose book, Happiness: Lessons from a New Science, has had a surprising effect on politics since it was published last year.

It was partly a tribute to the power of Layard's lobbying that Patricia Hewitt, the Secretary of State for Health, last week announced a shift in emphasis in the treatment of mental illness. Henceforth the rhetoric, at least, of Government policy on depression and anxiety will be tilted towards psychotherapy rather than anti-depressant drugs.

Layard's book has had a more subtle effect on public debate, in that his ideas have been taken up by many of those in all parties who are trying to define the shape of post-Blair politics. Some of these thinkers include people who are close to Blair and want to keep the permanent revolution of New Labour going.

I am told that Matthew Taylor, who was head of the Prime Minister's policy unit before the election, was responsible for the following paragraph in the Big Conversation pre-manifesto document: "Despite rising affluence and expanding opportunities, the people of the UK ... do not feel themselves to be any more content with their lives. One of the challenges of the future may be to rethink the very goals of public policy."

Very useful, Tony Blair might have muttered sarcastically. No surprise that such a radical thought, which might have undermined much of a Labour manifesto devoted precisely to increasing affluence and expanding opportunities, did not make it into the final document that was put before the electorate.

But the idea that British politicians might take a more direct interest in the promotion of happiness is likely to persist. It is not a new idea, after all, because it is enshrined in the US Declaration of Independence. Layard's book was one of the first that Alan Milburn read when he left the Cabinet after the election to think long-term thoughts. Its influence can be detected in David Cameron's toe-curling sound bite about the "quality of life as well as the quantity of money".

It is, indeed, a terrific book. As Andrew Marr says in his front-cover endorsement, it is "more provocative of actual thought than 99 per cent of books said to be 'thought-provoking'." Its central observation is that, above about $20,000 per year, more income is not associated with more happiness. This applies in different societies all over the world, and has done since such incomes became common enough to be measured.

Layard collates the evidence briefly yet exhaustively, including a New Yorker cartoon in which a man says to another man behind a desk: "OK, if you can't see your way to giving me a pay raise, how about giving Parkerson a pay cut?" The book deals deftly with objections such as to the measurement of happiness, before advocating the promotion of values known to produce deeper satisfactions than mere hedonism.

Some of Layard's ideas raise uncomfortable questions about New Labour policies. With more than half an eye on the NHS, he points out that reorganising large institutions may seem to improve productivity, but because "losers" feel their loss more keenly than gainers feel their gain, changes can "cause more misery than they remove".

But that is a terribly conservative argument. Clearly, there would be no need for politics unless some changes benefit society as a whole, and the gains outweigh the losses. Perhaps the only safe conclusion is that, as Layard says, "Politicians are generally more sensitive to these issues than economists, since they often know more about human nature."

There are further dangers in Layard's approach. One is that it might suggest that the values associated with profound happiness, such as trust and selflessness, are antithetical to market economics. He quotes a 1980s study by the psychologist Edward Deci, who gave puzzles to two groups of students. One group he paid for each correct solution, the other he did not. After time was up, both groups were allowed to go on working. The unpaid group did twice as much extra work. "For the group that had been paid, the external motivation had reduced the internal motivation that would otherwise have existed."

That may be interesting, but it does not suggest that an economy that separates payment from work would make people happy. It may be that a free-market economy provides the best context in which the values that nourish happiness can thrive. To take an example as trivial as Deci's experiment, you only have to take part in internet second-hand trading such as eBay or Amazon Marketplace to see how trust and mutual satisfaction can be generated by market exchange.

There is a bigger flaw in Layard's book. He says that we haven't got any happier over the past 50 years, despite getting much richer. His answer is to focus directly on the causes of unhappiness and to use what we know, such as cognitive psychology, which can be an effective response to depression, anxiety and some other forms of mental illness.

Yet the understanding of psychology, and the use of psychotherapy, has been one of the great growth areas of human activity in the past 50 years. It too has had no overall effect in making the rich societies that can afford it any happier. Layard might just as well conclude that therapy doesn't make us happier, and therefore we ought to concentrate on getting rich.

We should, therefore, beware of sweeping generalisations. Most people who study psychotherapy are careful of suggesting that its purpose it to make people happier in some simple, quantifiable way. Freud himself spoke only of "transforming your hysterical misery into common unhappiness". (Although he did suggest to a theoretical patient that, "with a mental life that has been restored to health you will be better armed against the unhappiness".)

It clearly makes sense to study and to try to understand the roots of human contentment, and Seldon should be congratulated for pursuing such an innovative policy at Wellington. But some of the implications of Layard's work, that politicians should not promise to make us richer but happier, can lead too easily to paternalistic assumptions being made on voters' behalf.

j.rentoul@independent.co.uk

The writer is chief political commentator for 'The Independent on Sunday'