Morality during COVID-19: Rent and Unemployment

Recently, I had a conversation with a client that bothered me a bit. He owns a rental property and told me that because of COVID-19, MA passed a regulation that essentially gives tenants the ability to not pay rent without the threat of eviction. He also stated that while they did not have to pay him, he was still required to pay the mortgage on the property.

I suppose that there are many unintended consequences resulting from the measures passed during this time. I read a story about a woman that owned a holistic healing facility. When she received funding from the Paycheck Protection Program (PPP), she excitedly called all her staff and told them she could pay them now, and they could all come back to work. But rather than be greeted with enthusiasm, she was met with disappointment. Her staff told her that with the current unemployment benefits, they could make more money by staying unemployed. 

So what is the right thing to do in these situations? Should the tenant pay rent? Should the staff go back to work? 

Predictably Irrational: The Hidden Forces That Shape Our DecisionsI read a book called Predictably Irrational, written by Dr. Dan Ariely, while he served as the Alfred B. Sloan Professor of Behavior Economics at MIT. Needles to say, he is a brilliant guy. His book is a fascinating series of experiments showing how irrational most people will act, regardless of their so-called intelligence. But in fact, since irrationality is the norm, one could call it both normal and predictable. 

There are a lot of great examples in the book, such as an experiment where he’d sit in a bar and provide free samples of a new “special brew.” In fact, the special brew was just a common tap brew with two drops of balsamic vinaigrette. Here’s the interesting part, when he told the bar patrons the contents of the beer before drinking, they inevitably crinkled their nose and said the beer tasted bitter. About 70% said they did not like it. However, when he did not tell them the “secret formula,” they overwhelmingly said they liked the beer, about 70%. Obviously, someone liking or not liking the beer should not be based on knowing the ingredients, but in reality, it does!

I give that example to open a dialogue on how there are dozens of ways in which people think one thing, a.ka., “I can be unbiased about how something tastes, regardless of whether or not I know the ingredients”, and in reality, they will act entirely different. If you think about it, for the sake that it makes sense that we should drink what we like, the unbiased beer tester gains nothing by allowing his bias to form his/her decision. 

Let me share with you another experiment in Dr. Ariely’s book. This one had to do with cheating. He set up an experiment using MIT students where the students would take a simple history based test, and the higher score they received, the more tokens they would receive. These tokens represented small sums of money, like 10 cents. Long story short, he set up three groups:a control, those that took the test and handed it in to be graded, a second group that took the test, but were asked to self-grade their test afterwards, but with a proctor in the room, and a third group that could self-grade the test, but without supervision. So, do you think the MIT leaders of tomorrow cheated? Of course they did. Interesting enough though, students from group three, those without supervision cheated, but at about the same rate as the second group with the proctor. 

Someone reviewing the research, which, by the way, was expansive across multiple universities – may conclude that inevitably, all people will take advantage of a situation that they deem advantageous for them. However, here is the interesting part – nobody handed in their test with a perfect score. No one! While all people may be willing to justify some “cheating”, they did so within their limits of their conscience. Such was made even more clear with the third group, while they had a greater opportunity to go all the way, they still chose some restraint. 

One last example involved Coca-Cola. Professor Ariely went around campus and slipped six packs of Coke into public refrigerators in the dorm buildings. What do you think happened here? If you said, they all disappeared, you are right. But then, he tried something else. He put a plate in the fridge with six, one dollar bills. Do you think they disappeared? If you said no, you are right. While it may be one thing to “just drink a Coke,” it’s a whole other thing to take someone else’s money. However, when you think about it, a can of Coke costs just about the same amount as the physical money. So why do we perceive it so differently? That was one of the questions posed by research. 

Now, going back to the recent examples of rent and unemployment. Should the renter pay his tenant? After all, it sure would be nice to keep that money in your pocket for another month. Let’s assume this renter was previously able to afford their rent, and that s/he is either still working, or perhaps collecting unemployment, which actually resulted in a slight raise. So the question is not really a question of money, it’s a question of… something else altogether. 

Morality Can Trump Tribalism - Pacific Standard

Should the renter just pay rent because it’s the “right thing to do?” Will the renter pay rent? According to the studies above, the renter and millions in similar poisons are likely to take advantage of the situation. However, there are two critical elements we have not yet discussed.  One, is a twist on the trivia experiment performed by Dr. Ariely. Under the same three testing conditions as previously stated, except this time, he asked the students to sign a piece of paper stating that they would abide by MIT code of conduct policy while taking the exam. The funny thing was, MIT did not have any official code of conduct policy, but none-the-less, the results were dramatic. When people voluntarily committed to this imaginary policy, they did not cheat. Nobody boosted their scores, they simply decided to pass in their tests with their original answers. Why, you may ask/ Because, the simple exercise of thinking about doing what is right, is in fact, enough for people to do the right thing. Dr. Ailey’s research showed that whether it was asking people to think of the Ten Commandments before the test, or some other arbitrary form of morals, it always resulted in the majority of people choosing integrity. 

I would like to take this notion of morality one step further. Let’s look back at the example of the holistic healing facility worker and her or his decision to file for unemployment. Certainly, some extra cash in the pocket is good. Especially when it comes with no extra work. Let’s think about it: extra cash while spending your days binge watching Netflix and taking long walks in the park with your dog. Sounds nice, right! On the other hand, let’s consider the owner of the holistic facility. Without staff, the facility cannot operate. And perhaps that center has fixed bills like a commercial lease, electricity, and perhaps even the loan the owner took to remodel the center years ago. All those bills are still due. Furthermore, the PPP money is not supposed to be used for rent or to repay loans, it is supposed to be used for payroll. While the staff may see the unemployment check as a windfall, the owner may be worried about losing the business and even bankruptcy. 

Here is what I think and here is what I know from my human experience: It feels good to do good things. It feels good on multiple levels. Let’s start with basic human physiology. Every time you accomplish a task, your brain releases a shot of dopamine, which is its way of saying, “good job, chum, keep it up” (why your brain has a British accent, I don’t know, but you can take that up with your brain). You can definitely get that sense of accomplishment at work, but much less so while sitting on the couch. 

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Likewise, when you do an act of charity or kindness, we also feel good, but in a different way. Perhaps that is serotonin. I’m not a scientist, so I’m not sure of the physiology of it, but I know this for sure – as humans, it just feels good to help another, especially someone in need or when we see our efforts as part of a cause. That cause can be as simple as “me going to work will keep this place in business.” Conversely, when we have the opportunity to help another and we don’t, we kind of feel like crap. We may not readily admit it to ourselves, but we have a tinge of regret, and think to ourselves, “I could have done something.” 

Knowing that emotionally, spiritually, we are lifted by good deeds, then the equation of unemployment vs. work looks a little different. In fact, I’d bet that if the staff went back to work, especially if s/he knew that they helped the boss, the company and the hundreds of people that relied on that healing center, they would feel terrific inside. And that feeling is worth far more than that extra money, which, all of a sudden, doesn’t look so inviting.

Well, how about the case of the renter? Afterall, aren’t all landlords evil overlords with hoards of cash? Perhaps that is true for some, but what if that’s not the case? What if the boss from the holistic center was an honest hard working person that had dedicated their life to helping people using natural healing. And what if the landlord was just another joe-schmoe, who lived in that house for years, and one day, after working really hard and saving every penny, was able to afford his dream house and could rent out his old house as an investment. What if he didn’t have millions in the bank, but truly used that rent to pay the mortgage each month. Should he really lose that rental property so you can get free rent? What if he had two or three properties, and the domino effect of multiple tenants not paying rent caused him to lose all his properties, including the house he lives in with this family? Does anyone want that? 

Here’s my recommendation: be honest with yourself and your situation. If you have lost your job or have been truly financially affected by COVID-19, then I don’t think anyone would criticize you for doing what you need to do. But if you have not been affected, then you are faced with an entirely different decision. Not one of need, but that of morality. When faced with that decision, I urge you to not just consider your pocketbook, but that of your spirit, your emotional well-being. How will this decision affect you on the inside? How will it affect others around you? Which decision is best for your community, your company, your country and most of all, for you as a person? Does this decision bring you closer to the person you want to be? Make no mistakes about it – you may have taken a Coke from a fridge before, and thought it was relatively harmless. And if you have, you are no different than those MIT students who are likely in high roles of prominence now, and I suspect, mostly good honest people. You are a good person! Make the decision that allows you to love yourself; making the decision your spouse and children would be proud of. Even if you do not have a spouse and children, think, if you do one day, what story would you like to tell them? What moral would you want to pass on to them?

I believe you will make the right choice – and feel darn good for it.

With Hope and Sincerity, 

Brad Stoler

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