What would Pigou do?

Arthur Brooks, in today's Wall Street Journal (subscription required), highlights an externality without an obvious solution:

The strange fact of the matter is that the hard-core liberals and conservatives in America are actually some of our happiest citizens. According to the National Opinion Research Center in 2004, in spite of all their bile, 35% of people who said they are "extremely liberal" also reported being "very happy" with their lives -- versus 22% of people who were just "liberal" and 28% of moderates. At the same time, a whopping 48% of people who were "extremely conservative" were very happy (compared with 43% of non-extreme conservatives)....

The trouble is that, while radicals may be happy, they undoubtedly lower the happiness of the rest of us through their intolerance and antisocial ways -- spewing out what economists call "externalities" with every insulting bumper sticker and obnoxious street demonstration. Political nastiness is something akin to pollution.

Extreme political views need not go hand in hand with intolerance (Milton Friedman being a good example a tolerant extremist), but unfortunately they often do.

To foster tolerance, what we need is more interaction among people with opposite viewpoints. How about a student exchange program between Harvard and Liberty University? Or an affirmative action program to hire more Republicans for the Harvard faculty? Now that would be real diversity.