Column: Your tax dollars at work: $5 bribes to take a government survey

Sometimes a scam seems so obvious it’s almost not worth looking into.

Pasadena resident Eileen Ritchie contacted me the other day to ask about a letter received by her 92-year-old mother. The letter, purportedly from the U.S. Census Bureau, was an invitation to take a survey about the recipient’s spending habits.

Included in the envelope were a $5 bill and what was claimed to be a $40 gift card.

“I thought the $5 was extremely peculiar,” Ritchie, 71, told me. “Even when the government sends you a refund, they don’t send cash.”

I replied that none of this passed the smell test. Sending a letter like this to a 92-year-old woman seemed like a typical racket targeting seniors. The “gift card” was probably a worthless piece of plastic.

Most tellingly, Ritchie was correct in her suspicion about a government agency sending cash up front for voluntarily filling out a form. Had to be a scam.

I was wrong. It was legit.

I’d stumbled onto the Gemini Project.

That’s what the the federal government’s Bureau of Labor Statistics is calling an experiment aimed at improving its Consumer Expenditure Survey, which helps determine the inflation rate. Participation is falling, so officials are turning to good old-fashioned payola to see if that lights consumers’ fire.

“We’re trying to incentivize response rates and motivate respondents,” explained Laura Erhard, a bureau economist overseeing the Gemini Project.

Of course, I asked straight away why the government gave such a sinister, B-movie name to a statistical program.

“We were just trying to come up with something catchy,” Erhard said. “It makes it sound big and important, doesn’t it?”

Disappointingly, she acknowledged that the Gemini Project doesn’t involve spaceships, time travel, cyborgs or sentient computers. But let’s be honest: If it did, would they tell us?

The Consumer Expenditure Survey uses face-to-face interviews and written records to measure on a quarterly basis how people spend money on such things as housing, food, transportation and healthcare. That data is used to help create the consumer price index, which tracks the cost of living.

Erhard said bureau officials wanted to see if they could improve participation in the survey while at the same time save a buck by performing fewer face-to-face interviews in people’s homes every three months. So in 2009 they dreamed up the Gemini Project.

Here’s how it works: Survey recipients, who are selected by address in order to sample specific areas, have been divided into four groups.

The first is receiving a $40 gift card but the PIN only will be provided after the survey is completed. They get an extra $20 gift card if they hang on to their receipts for utility bills and other household expenditures.

The second group gets the two back-end gift cards but, like Ritchie’s mom, also receives five bucks up front with the invitation letter, no strings attached.

The third group gets the $5 and the $40 gift card, but no extra $20 for record-keeping.

The fourth group gets bupkis, just the satisfaction of performing a civic duty.

So you’re probably wondering: How many $5 bills are being mailed out, and does the Bureau of Labor Statistics have like a drawer full of cash?

“No, it’s the Census Bureau with the drawer full of cash,” Erhard said.

The Bureau of Labor Statistics is paying the Census Bureau to do all the field work. A spokesman for the Census Bureau referred all questions back to the Bureau of Labor Statistics.

In any case, we’re talking about a fat stack of cash. The $5 bills were mailed to 2,700 households.

Erhard said the Gemini Project is being conducted through December. Officials will take what they learn and rejigger the Consumer Expenditure Survey accordingly.

I predict they’ll discover something like what Ferris Bueller once so wisely observed: “See what a finski can do to a guy’s attitude?”

However, marketing experts say the jury’s out on whether baksheesh is the best way to influence consumer behavior.

“The usual objection is that people will just pocket the $5 and dump the survey, since they don’t have to complete it to keep the money,” said Oleg Urminsky, a marketing professor at the University of Chicago.

“But people have a strong reciprocation motive. If someone gives us something, it taps into the social norm that as long as it’s reasonable, we should do what we can in return.”

In simpler terms, he said, “you helped me, so I’d be a real jerk not to help you.”

There may be something to that. But Kelly Goldsmith, an assistant marketing professor at Northwestern University, said the opposite may be true.

“Lots of academic research has identified situations where giving people small amounts of money for completing the task can actually reduce their likelihood of complying because it undermines their intrinsic motivation,” she said.

“When I see myself as doing something for a small amount of money, I infer that I’m not really interested in doing the task for its own sake, and this can ultimately decrease the odds that I’m willing to do it at all.”

As a taxpayer, I’m a little alarmed by the notion of the government sending out cash to bribe people into taking a survey. We’re only talking about $13,500 in this case, but still.

Erhard said funding for the Gemini Project was “scrounged” from the bureau’s existing research budget, and the hope is that taxpayers will save money down the road by reducing the program’s annual cost.

I asked how the project is going. Erhard said official results won’t be available for months, but that right now it looks like greasing the palms of survey recipients “is improving response rates, but maybe not as much as we hoped.”

I also asked if officials from other government agencies snicker whenever the spooky-sounding Gemini Project gets mentioned.

“Not to our faces,” Erhard said.

David Lazarus’ column runs Tuesdays and Fridays. He also can be seen daily on KTLA-TV Channel 5 and followed on Twitter @Davidlaz. Send your tips or feedback to [email protected].

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