Is Poverty Real?
It’s hard to overstate how different India is from the United States. There is a continuity between a ranch in Texas and Disney World that does not exist between New York and Chennai. There are no cows on Fifth Avenue.
Such was the setting when I first learned poverty was a thing. I have a vivid early memory of leaving a store in a shopping square to get back to our car and a full two dozen people in tattered clothing and various stages of leprosy following us asking for money. Or at least that’s what it felt like. Safe in the car, I asked my mother about it. I don’t remember what she said, but I ended up believing they were not actually poor but trying to trick us into thinking they were.
The contempt made seeing them easier.
On another trip, when we got to our car being followed by the same two dozen people, my mother lowered the window a couple of inches and told me to pass through a banana to one of the beggars before we drove away.
Scared, I push it out the crease of the window without risking being touched by him or anyone else out there out there.
The beggar had no fingers.
In fact, I think one of his hands was a stub, perhaps an elbow. I saw him struggling to hold on to it, but the car had already started moving.
As we drove away, I realized he probably would not be able to hold on to the banana, let alone peel it.
I don’t know whether my stomach felt worse then or now when I am sharing the story for the first time. It was a singular horror of the world wordlessly revealed to my young mind.
And let’s just not think about all the other people to whom I gave nothing.
I’d like to say that that was the day poverty became a real, tangible thing for me, but knowledge of poverty has always been ephemeral. It is an inconvenient truth whose truth does not fully compensate for its inconvenience.
Disbelief
I do not know, but I suspect that many of you similarly disbelieve in poverty. And by “disbelieve”, I do not mean you deny poverty. I mean that you act as if there were no poverty. And perhaps you never even considered acting as if poverty exists.
Let me explain. Take a look at GiveWell’s assessment of their top-rated Against Malaria Foundation:
Using the 2012-2013 cost per LLIN, we estimate the cost per child life saved through an AMF LLIN distribution at just under $2,300 using the marginal cost ($5.15 per LLIN) and just under $2,500 using the total cost ($5.54 per LLIN).
This does not include other potential benefits of LLINs (non-fatal cases of malaria prevented, prevention of deaths in age groups other than under-5 year olds, prevention of other mosquito-borne diseases, etc.).
Let’s go ahead and ignore the benefits in the second paragraph and take the higher estimate in the first paragraph. If you actually believed that you could save a human life for $2,500, how would you act from now on?
Let’s make it a bit more explicit. Some sort of deity who is able to demonstrate his powers to your satisfaction tells you that from now on, every time you fail to find an opportunity to save to spend $2,500 on mosquito nets, you will find the corpse in your bedroom closet of the person you failed to save. The body will vanish at the end of the day without inconvenience or legal issues. You would nevertheless endeavor to avoid finding corpses in your closet.
If that were to happen, your creativity in finding $2,500 would become unbounded. You’d scrap most expenses, trade in your collection of crap, negotiate a higher salary, and get a second or third or fourth job until you stopped finding corpses. You would start companies in your time off. You would structure your whole life around your knowledge of poverty.
I am guessing that you (like me) have not actually done this. Some of you have may have thought about it, but you probably thought about it in the same way that Louis CK thinks about giving up his first class seat to soldiers flying to wars and then never actually does. The purpose of the thought is to make us feel like better people without burdening ourselves with the nuisance of actually being better people.*
In reality, you don’t see the corpses of the bodies you don’t save. Our brains retain plausible deniability over the fact that we could be saving a human life for every $2500 we pointlessly spend.
How disbelief happens:
Forgive the complete lack of a basis in reality, but I posit that your brain has two parts. One part intellectualizes your decisions on blogs and is already figuring out all the reasons I’m an idiot and this is all wrong. That is the part that you will never let make any decision that matters. That part of your brain can know that people die cheaply preventable deaths that you personally could prevent but will nevertheless find a reason not to.
The other part is the part that actually controls behavior. It decides what we buy. It will sacrifice everything to avoid believing inconvenient truths. It does this by carefully compartmentalizing dangerous knowledge in the safe, ineffectual part of your brain.
This Chinese wall is how I can know that there is poverty but never act like I know it. This is how I spent 1/4 of a human life on a new iPhone, which was actually one of my more defensible purchases this year. (Most things I buy deliver far less value per ounce of flesh.)
Rationalizations:
How does the intellectual, ineffectual part of our minds rationalize these awful choices? Since our intellects are powerless to change our behaviors, we use them to generate reasons that we either cannot or should not change.
I already described my first rationalization: the supposed poor are liars trying to trick me.
The second rationalization I came up with was that I didn’t know whether charity actually helps. I took this rationalization to the point of reading about cases in which international charities caused great harm through unintended consequences of their aid. And I still internally use this excuse for not donating to charities randomly when someone asks me to.
This second rationalization falls, however, when one has the option of doing real research on a charity. The aforementioned GiveWell believes charities should bear the burden of proof and thoroughly vets the charities it recommends. They document why they come to their conclusions and detail their evaluation process. Their recommended charities offer significant opportunities for good using relatively few dollars.
My third and currently-held rationalization is that while mosquito nets can save lives, they are not transformative. For reasons I cannot entirely explain, transformative change has always come from economic development, and economic development has always come from economic liberalization. It comes from trade, economic freedom, capital formation (including education), peace, and the absence of corruption. Mosquito nets will save lives, but they will not make the poor rich.
The best ways to assist with economic liberalization are unknown to me, but by participating in world trade, we make it more attractive for countries to join in and less attractive for countries to opt out. So, the best way for me to do good is to do what I already was doing.
Which is convenient and a relief, because I was going to keep doing it anyway.
* It’s worth noting that both my confession of how I don’t help people and Louis CK’s confession that he doesn’t help soldiers is also part of the same defense mechanism. Admitting our sin feels good and permits us to continue sinning.
Photo credits: Wikimedia Commons, Flickr user Michelle Lee
I took this rationalization to the point of reading about cases in which international charities caused great harm through unintended consequences of their aid.
This is such a persistent argument. Don’t do something because the unintended consequences will cause harm. Don’t improve the nutritional value of food served in school lunches because kids might throw it out instead of eating it. Don’t limit point-source pollution because businesses might shutter. Don’t give girls vaccines to prevent PPV because it might encourage them to be sexually active. Sigh.
Here in Maine, I like it when they don’t repair the potholes in the roads, and it slows traffic down to safer levels. I like it right up to the point where those potholes damage my car, and then I’m all discomforted about the sorry state of our bad roads. That damage to my car is also an unintended consequence.
I wonder, Vikram, if the justifications you describe are a way to deflect other feelings. It’s difficult to look at someone in dire circumstances and not feel empathy; and at a certain point, that empathy can become overwhelming. We often feel we should do something, we’d want someone to do something to help if we were in such circumstances.
Economic liberalism may be the answer. But I have another: education liberalism and sexual liberalism. Educate women and give them access to contraceptives so that they have control over how many children they have.Report
In other words, not just economic liberalism, but liberalism. The freedom to get an education, to get and use contraceptives. Agreed.Report
I wonder, Vikram, if the justifications you describe are a way to deflect other feelings.
If this is true, it is probably the fact that the scope of the problem seems so overwhelming. There aren’t 10 people out there who need help. There are more people who could use help than we have seconds remaining in our lives. It’s much easier to believe there is nothing we can do than to do everything you can to help 0.00000001% of the people who you know need help.Report
Drop in the Ocean thinking overwhelms every philanthropist or charity worker at one time or another. It’s a fallacy, though. Can’t give in to that sort of thinking, ever.
No charity worker is ever truly alone, not if he’s doing his job right. The needy are not helpless, unless they’re completely catatonic. The needy are perfectly willing to help themselves. And may I add, if you encounter Learned Helplessness in the context of charity work, it must be stamped out immediately. The entire thrust of every worthwhile charity is not to solve a problem for any one person but to solve a problem afflicting many persons.
I’ve had to caution several people caught in the One Drop in the Ocean pit of despair. Either they get their shit together and do what can be done, or go the hell home. It’s a species of self-pity. The people in need are not stupid, they are not helpless, they want only to get back to their lives.Report
Agree.
Poverty is real and the key to address it not primarily through redistribution, either voluntary or involuntary.
Prosperity comes from allowing the emergence of institutions where people are empowered to create value for themselves and others. The proven paths are universal institutions which define property rights, the rule of law, and economic freedom.
In other words, what the poor need is the freedom to engage in whatever productive enterprise they choose and the freedom to interact economically with whomever mutually agrees.
One side of the coin is economic liberty. The other though is freedom from coercion — theft, involuntary redistribution and regulatory manipulation. Free people who are not exploited by others can become increasingly self sufficient and prosperous enough to voluntarily support those who are unable to help themselves.
There are lots of things we could do for the poor. I am convinced that there is nothing more important than pushing for their freedom to be as self sufficient as possible.Report
While I don’t necessarily disagree with this, I think there are a few things missing, and those things might require some ‘redistribution.’
1. A fair justice system; one that doesn’t leave those in poverty hanging in the wind if they cannot afford legal representation;
2. Access to education, and not just education, but good education that teaches cognitive process;
3. (As I said above), education of women, access to save contraception;
4. Sound environmental policies that protect the neighborhoods of the poor; providing safe water, safe soil for growing food, and safe air to breath;
5. Access to medical care;
6. Access to the financial system;
7. A voice in government.
I’ll stop there; though I could go on. But building schools, building safe water and sewer systems, building medical clinics, building banks requires both public and private investment, and some redistribution. Honestly, I prefer another word to redistribution: investment.Report
(last sentence, ‘word’ not ‘work.’Report
I don’t necessarily disagree with you either. My central point is that economic growth trumps all the other band aids. At current trends, per capita GDP is on pace to being ten to twenty times higher in developing countries by the end of the century. This is the true source of sustainable schools, medicine, roads, contraception, clean water and so on.
I too prefer investment over redistribution. A key distinction between the two is whether the interaction is voluntary or not. Another important factor is whether the action is decentralized or master planned (imposed top down).Report
Roger,
personally, I prefer charitable profitable companies. If it’s useful enough to someone, you ought to be able to convince them to buy it.Report
Zic,
Frequently those things don’t really arise until after development takes place, because that’s when people’s exoectations rise and they feel relatively secure enough materially to demand these things. It’s not that governments shouldn’t do that before development, but historically they generally don’t (because what’s their incentive in the face of insignificant domestic pressure?)
Hell, even in the U.S. legal equality for African-Americans didn’t come into being until there was a significant class of educated and middle-class blacks, despite our level of development. And consider Taiwan and S. Korea, where development occurred, then demoratization resulting from protests.
So if we want those things to come into being, we’ll probably do better to encourage development. I don’t find this particularly satisfying, since I think development per se is less important than those other things, but it seems to be the way the world tends to work.Report
@jm3z-aitch I have some problems with ordering events here. I have some concerns about the concerns of how and who brings events about, too.
From what I see, there’s always some combination of players that make legitimate progress in a region; often, it begins with grass-roots activism that produces enough energy to form partnerships with local governments and attract both private investment and public assistance and charity.
I have never, ever seen real economic growth and elimination of poverty without a combination of actors participating.Report
@jm3z-aitch, I’m not really so sure that you need an X amount of development in order to get what Zic thinks is a good idea. At least for the education of women and access to contraceptives you don’t really need an X amount of development. Even in many poor countries, where children would still be an economic boom rather than cost, the birth rate is decreasing. This includes countries with high illiteracy rates and not exactly stellar records on feminism.Report
@roger ,
What if participation in “institutions where people are empowered to create value for themselves and others” requires, at least temporarily “involuntary redistribution and regulatory manipulation”? Before people can create value for themselves, they need to be fed. What if, in the short term, the only way to effectively feed these people is through a basic social welfare system funded via a progressive taxation scheme? The goal may be to eliminate the need for such a system but what do we do in the interim?Report
Yes, Kazzy, good point, and a good question.
Here’s another question for Roger: in what way, specifically, do you think poor people aren’t currently empowered to be self-sufficient? When you use that word, do you mean it to refer to governmental institutions as depriving people of their empowerment? Do you mean it as having cultural content? Individual psychological content?
From where I sit, I agree with what you say if you by “empowerment” you mean something psychologically held by the individual. I agree less so if you believe that kicking people off social programs constitutes empowering them.Report
If the only way to feed people is via short term imposed emergency redistribution, then I endorse short term emergency redistribution.
This is of course not to imply that this is the situation today. The first world is wealthy enough that feeding people that are starving becomes relatively easy to solve in terms of economic costs (the exploitation and political challenges are much larger).
A coercive progressive taxation scheme to redistribute from the developed to the undeveloped nations risks becoming a disaster of epic proportions. It could attract rent seekers, free riders, and exploitative parasites of the worst type. Voluntary philanthropy and decentralized aid with effective feedback is a better idea with coercive redistribution as a last resort.
But again, we must not take our eye off the real, long term solution. Economic liberalism.Report
Roger never misses an opportunity to bang the bottom of his little tin pot about Economic Liberalism. The First World is not capable of feeding every hungry person. Startling idiocy, to even suggest such a thing.
No, Roger, show me poverty anywhere and I’ll show you a fucked up, corrupt nation which tolerates it. Run by your precious Economic Liberals, every last one of them.Report
do you mean it to refer to governmental institutions as depriving people of their empowerment? Do you mean it as having cultural content? Individual psychological content?
“Or”? Or “and”?Report
No, Roger, show me poverty anywhere and I’ll show you a fucked up, corrupt nation which tolerates it. Run by your precious Economic Liberals, every last one of them.
Libya.Report
It could attract rent seekers, free riders, and exploitative parasites of the worst type.
You’re dwelling in the House of Vikram’s Second Rationalization.
Bars do this, too. And grocery stores. I sell knitting patterns on-line. For every pattern that someone purchases, there are likely 100 patterns that someone downloads for free.
Fact is, rent seekers, free riders, and exploitative parasites are a fact of humanity. So being human because they exist seems incredibly obtuse to me. You end up punishing the innocent to stop a human trait that just is. Far, far better to plan for it; to find methods to eliminate it to a reasonable degree, and turn a blind eye to the parts that are too expensive to go after (meaning the cost of control far outstrip the economic damage done.)Report
Libya? Libya under Gaddafi was a welfare state. People got handouts from the oil money. Nobody starved in Libya under Gaddafi.Report
“..in what way, specifically, do you think poor people aren’t currently empowered to be self-sufficient?”
As I wrote in my initial comments their states lack fair institutional property rights and economic freedom. Included in economic freedom is the freedom from active exploitation from above, without or within. I do agree with you that there can be cultural and psychological enslavement. Though I did not address this dimension.
My definition of empowerment had nothing to do with kicking poor people in undeveloped nations off of social programs. That said, social programs that get in the way of economic growth will be counterproductive to human welfare and the long term plight of the poor.Report
Blaise,
I will repeat that I refuse to respond to someone who calls me a turd, mocks me at every chance and threatens me (as you have done more than once). Your behavior toward me is unworthy of continued dialogue.
Over and out.Report
@roger
I once discussed how I would run a soup kitchen were I so positioned. Rather than staff it with volunteers doling out food to the hungry, I would seek to train and employ those we seek to feed, paying them for their work, and helping to end their need for soup kitchens. I would probably feed fewer people overall, as I would have higher overhead due to paying wages, which is no doubt an issue. But if run well, there would be fewer people in need of a soup kitchen.
This idea received much criticism from some of our more radical liberal elements here.
I share your goal, though we might disagree on the iterative steps necessary to reach it.Report
Roger, if you don’t have anything to say, then don’t say it. I’ll say what I feel needs saying. If you don’t like it, it’s all a question of Mind Over Matter. I don’t mind and your opinion doesn’t matter.Report
Included in economic freedom is the freedom from active exploitation from above, without or within.
How do you prevent exploitation?
It seems to me that this requires a fair justice system, which rests on the rule of law, which flows from the state.
Am I missing something? Because these conversations always seem to circle around this but never really address it directly.Report
Zic,
Your reading of my comment was not all that charitable. I mentioned that voluntary actions are extremely capable of addressing poverty. For example, on Saturday my grandson and I volunteered for a few hours to prepare meals for children in Haiti. Between donations, time and coordination, we and many other “wealthy” first world people did our small part to feeding three hundred potentially starving kids for a year via a decentralized charity group with an excellent proven record of actually getting meals to humans in need.
I also mentioned (twice actually) that as a last resort, if voluntary actions were inadequate, I would support short term imposed redistribution if necessary to keep someone from starving. In other words I gave a preference ordering and supporting logic for the preference, not an excuse.
Do you disagree with my ordering… First voluntary, then imposed? Why?Report
@roger ,
How much of your voluntary effort was made possible by state efforts funded by tax dollars?
How do your meals get to Haiti? Presumably via a plane or boat. Boats enjoy safe passage because of the National Guard and Navy. Planes fly safely because of federal restrictions on air space usage and the like.Report
@roger I don’t think it was an uncharitable reading; I think the concerns over ‘forced redistribution’ overshadow much that actually takes place; particularly the partnerships between ‘charity’ and ‘government.’
Charity is a wonderful thing. But it’s also a funny thing; it tends to fashion and fad; it’s attention often shifts to the next humanitarian disaster long before the basics of economic liberation ever root. It also allows for some degree of discrimination in aid; and those who are left out due to that discrimination are left out.
You worry about top-down government and central planning; yet bottom-up planning are as likely to enable the folk who abuse aid.
Personally, I think the best systems arise when there’s a host of efforts engaging a spectrum of people; that there’s no one best way, and that there will be abuses and there will be people dropped through the cracks of any system. I think top-down planning is essential to making best use of scarce resources, and I think bottom-up activism essential to illuminating needs for those resources.
But I’m still in a quandary to comprehend how we deal with problems of exploitation without a legal system that stems from government; and I say this recognizing that system has to be able to recognize and change in the face of exploitations that it creates.Report
“How do you prevent exploitation? It seems to me that this requires a fair justice system, which rests on the rule of law, which flows from the state.”
One caveat…. I think it flows from a cultural paradigm or shared ethos. It starts with the dim awareness that we can accomplish more together playing positive sum games than we can playing zero sum ones. From this we begin to create institutions which support the rule of law, a fair justice system, property “rights” and a belief in the value of freedom and a corresponding suspicion of imposed order.
I am in no way an anarchist. I see the state providing rule of law and such as a great institution.Report
Kazzy,
I am not an anarchist. I think a coast guard is a good idea, and it seems to me we should continue to use government to provide defense and various public goods until such a time as a better method comes around (if ever).
I am not sure where you assume we are disagreeing. Could you flesh that out more?Report
One caveat…. I think it flows from a cultural paradigm or shared ethos.
Well, here’s an example of cultural paradigm and shared ethos in India, and just how difficult it is to shift the paradigms that lead to exploitation.
Be forewarned, that’s a deeply disturbing report.Report
@blaisep
See here.Report
@zic
Charity is a wonderful thing. But it’s also a funny thing; it tends to fashion and fad; it’s attention often shifts to the next humanitarian disaster long before the basics of economic liberation ever root. It also allows for some degree of discrimination in aid; and those who are left out due to that discrimination are left out.
Yes, the human is a fickle being. But, as Madison said, “But what is government itself, but the greatest of all reflections on human nature?”Report
Charities are great and noble things. From my experience behind the scenes most charities at least wryly acknowledge they are organized, institutionalized beggars. The charity i worked for was lucky enough to have sympathetic clients and was aligned with the Catholic Church so we had a good funding stream mostly. If you don’t have sympathetic clients then they are mostly screwed or if, for example, the leader of your national office is a priest who gets embroiled in a scandal regarding what priests got in lots of scandals about then all the people who you could help are screwed. On the other hand we had a Soul Asylum song on our national commercials so that is cool and all.Report
Look, by African standards, Libya is reasonably wealthy. You have to a long ways south in Libya, well into the Sahara, to find where the oil money hasn’t reached. I maintain my stance on this: Libya was corrupt under Gaddafi — and if poverty appeared, it did so as a direct consequence of that corruption.
I hate welfare states. To keep them relatively corruption-free requires so many Quis-es to custodiet ipsos custodes, you’re damned near endlessly recursing over Watchers to Watch the Watchers. You’re better off taking the money and simply giving it to the citizens, let them do what they want with the money. Most of these people will be sensible enough to invest the money in something really useful.
The very worst scheme is to wade into these situations, imposing some outsider solution to a lesser problem than the one everyone knows to be the big problem. That’s what I like about Bill Gates’ approaches, though he’s made some mistakes in this, I forgive him for all of them — precisely because he’s learning from them. See, Gates demands results for his money. Don’t expect a dime from his organisation if you aren’t prepared with a methodology for demonstrating progress.
In Guatemala, I had this little scheme going. Once you get off the main highway, it’s as if the conquistadors hadn’t arrived yet. Footpaths leading into hamlets. But there was a prestige society in place. We managed to convince two towns * it was possible to buy prestige by purchasing books to the community library. Every year, the cofradia establishes a presidente, who puts on big parties and thus garners prestige. But lasting prestige could also arise from signing his name in the flyleaf of every book he purchased for the community library. Also, we made a plaque with his name on it, put it up in the library, usually just a room attached to the cofradia building. We’d send students up there to help put in shelves and paint and suchlike.
Don’t ever pay a poor man to be poor. Welfare societies just sap the life out of a culture, rot it from within. Look at Iraq, same miserable story. Syria, yet another command economy gone down the soil pipe. Yes, you’re right, there is poverty hiding in the corners of command economies and welfare societies. But I don’t think I’m moving the goalposts, well, not very much — in saying Libya is by no means as bad-off as places like Chad and Mali and Niger Republic, where people really are starving. All such places are wide-open for business, business, that is, with the usual corrupt suspects busily looting the nation’s resources.
* Two, at first. It’s now fifteen such hamlets.Report
Not only are the cultures difficult to change, but attempting to change them from the outside is fraught with peril.Report
Cultures can be changed in a heartbeat and there are plenty of excellent reasons to change them. Putting women on refugee camp councils completely changes the tenor of those places. Putting girls in school and fighting back against attempts to keep them out. Cracking down on aggressive beggars. Cracking down on the sale of rubbish medicine. Cracking down on religious gangs and caste system enforcement. The very idea that Culture is some sacrosanct thing which shouldn’t — or can’t — be changed is complete nonsense.Report
Ah, Freedom. Anatole France once said “The law, in its majestic equality, forbids the rich and poor alike from sleeping on park benches.” I see market potential in a Libertarian approach to park benches. It’s so simple, I can’t believe anyone hasn’t thought of it before. Charge rent for park benches.Report
Roger,
I agree, but there is also charity/redistributiom that enables people to become empowered to create value. Education most notably.
Which isn’t to say identifying those opportunities is always easy, or that everything someone of good intentions claims is that type is necessarily right, or that thise opportunities are incorruptible sources of naught-but-good. But, and I don’t think you’ll disagree, that’s where we should encourage the focus for giving.Report
Agreed completely.Report
I’ve seen poverty in many places. But then, I’ve worked with refugees, a population who might be living in squalor at present but who weren’t always born into abjectest poverty.
I’ve seen beggars in the major cities of India, watched one throw some cow dung on my mother’s shoe in Delhi, just so he could clean it off for a few rupees. He cleaned it off, all right. I cornered him with my staff and made him clean it off and not one rupee did he get in compensation.
I have zero tolerance for aggressive beggars. Once you come to understand their culture, you realise there’s always a hierarchy of begging. Child beggars are forced to give their money to older beggars. It’s a vicious, depraved culture: children are mutilated to enhance their earning potential. And don’t be impressed by the tattered and filthy clothes: it’s a sort of uniform. They have nice enough clothes they wear when they’re not begging. Go into any slum, you’ll see.
You’ll never solve the world’s problems. The best anyone can do is give people the resources to change their own lives. Refugees are a natural byproduct of war: stop the war and you can empty out the refugee camps. But while they’re in operation, refugee camps must be run in an orderly, sanitary manner. Robbers and thieves must be expelled, they’re a constant problem. Refugee camps attract criminal types.
I approve of GiveWell’s approach to rating charities. But there must be more to intelligent philanthropy: there’s always a danger of creating artificial dependencies. Worse, a coterie of hangers-on develop, the “aid workers” who are in it strictly for the money and prestige thus created, people who do not respect the people in need. You’re always better to establish a local council with the power to effectively distribute the goods and services. Make sure that council has women on it or the men will seize everything. If you’re running a feeding station, feed the women and infants first, then the older children and finally the men. Any other schedule and the more-powerful will take food away from the less-powerful.
Don’t ever succumb to some Sad Story. Such stories are always bollocks, without exception. The world is full of misery. Lots of that misery is found in the homes of supposedly wealthy people and much joy is found in the “poorest” places. A proper charity can outline the problem it’s supposed to be solving.
A proper charity takes its clients seriously. The poor man craves respect more than life itself. Give him that, give his wife and children a future — you have changed the world. Anything less only makes poverty worse. It pays people to be poor and thus is the profoundest sort of disrespect.Report
I cornered him with my staff
Were you on vacation or playing D&D?
Sorry to hear about your mother’s experience. Unfortunately that sort of thing can happen. That first rationalization I mentioned does have some sprinklings of truth for some of beggars. Their level of desperation can be dangerous to others.
there’s always a danger of creating artificial dependencies
Givewell also seems to do a good job of assessing the potential for this. They pay attention to substitution effects and displacement of other aid and services.Report
My parents had come to visit me, doing a project in Bihar State. I’ve carried a wooden staff for many years in places where anything else would be considered a weapon. Pinned him down with the staff, told him to clean it off in Urdu. He got the point immediately.
I don’t approve of begging. It’s self-abasement. Desperation is one thing, need is another.Report
Often the simple staff, or walking cane, is overlooked as a powerful weapon. Everyone wants to learn the super secret martial arts moves with bare hands, or knives, or swords, or other exotic weapons.But a simple length of wood – pshaw!
I always travel with a walking cane/stick, and when airports hassle me about it, I show them the ugly scars spider-webbed across my knee. Always ends the debate.Report
MRS,
that’s because the staff was rarely, if ever, used as a solo weapon (as opposed to pikemen).
Because nobody taught it, it’s even more than a lost art.
If you ever want to learn an exotic weapon… try the yoyo.Report
@ Kim
Ever heard of Baritsu? Jojutsu? Eskrima? Stick fighting as a personal defense is taught.Report
MRS,
all of those bear much more resemblance to swordfighting. They’re shortstaffs, and wielded as such.
The longstaff, the quarterstaff was what I was referring to, I apologize for my obvious inclarity.Report
These days, people look at you funny if you walk around with a 5’+ stick, unless you are hiking.
A walking cane, on the other hand…
And Jojutsu covers short & long stick.Report
@kim It’s been quite a while, but I used to have a colleague who did battles with the Society for Creative Anachronism. The SCA had quarterstaff training and mock fights. As I recall, he told me that they didn’t let people do anything except rehearsed mock fights with the staff because it was too easy to injure the opponent when it was “for real”.
@mad-rocket-scientist Try carrying a rapier or smallsword around. You don’t just get funny looks, you get arrested (blade is longer than whatever local ordinances allow). I’ve never tried to have the conversation with a judge that starts: “Let me understand this. I can spend four hours in a classroom and you’ll give me a permit to carry a monster handgun around under my coat even though I’ve never fired a shot before. But I spend years developing the skill to use a sword properly and it’s too bloody dangerous to carry?”Report
Mike,
That’s what sword canes are for. Or umbrellas.
Some joker decided to wear a garotte onto a plane
The TSA didn’t even notice.
The SCA has “actual fights” with the quarterstaff, from what I recall, but no head shots.
I think the armor they wear helps.Report
@michael-cain Hell, I have a Concealed Pistol License, but it’s only good for pistols (& WA has no training requirement). Of course, the background check I went through to get the CPL included the State Police, the FBI, and Interpol, but I can only be trusted with a gun.
My saber is just flat out too dangerous.Report
An excellent post Vikram, possibly because I agree with it in general (and especially the last part about economic liberalism).Report
Thanks! Always good to know.Report
Your final two paragraphs, starting with “The best ways to assist…”, strike me as letting the haves collectively off the hook on a lot of social justice dimensions that I believe we ought question ourselves about more vigorously. There are themes that resonate with previous discussions about sweatshops: to what extent is exploitation involved in these transactions? Are there significant contributions to welfare we’re under-resourcing by emphasizing development through trade?
In other words, it would be convenient relief indeed to hear that consumer capitalism and current levels of charity/giving as presently constituted meet the test of what we, collectively, ought to be doing. But that perspective is worth a more rigorous interrogation, at minimum, on social justice grounds.Report
+1Report
I half-admit to this by putting it under the “rationalization” sub heading. I’m not at all confident that my choice is my choice because it is morally correct or just incredibly convenient.
If someone were to point to an effective charity that worked for economic liberalization in places where it was lacking, I would then be stuck with a big dilemma.Report
Thank you. I agree entirely.
Neoliberalism is not “transformative”, at least not in a positive way. Africa’s done worse under neoliberalism than it was doing in the ’60s, in terms of the rate of progress in human well-being. Ditto with Latin America in the ’80s and ’90s. “Free trade” more often than not means giving multinational corporations license to loot other countries while providing no benefit – and considerable harm in environmental and health consequences – to those countries’ people, and “free trade” agreements never address the ways in which developed nations bias things in their own favour (e.g., agricultural subsidies). Moreover, pretty much every nation that has become wealthy has done so by controlling its trade enough to build up an industrial base, not through across-the-board free trade agreements and absence of government action – look at Japan, South Korea (which was advised by development professionals that its comparative advantage was in growing rice and it had best stick to that) and China for some examples.
Charitable donations are valuable and useful contributions to human well-being. So is removal of the many ways in which we deliberately tilt the scales against developing nations. Complacently claiming that capitalism is working great and couldn’t possibly be improved upon does not help, and is in fact actively harmful.Report
I was hoping you’d drop by this post. I’m sure you’ve been studying Haiti with highly focused attention. It’s one of those places I’d hold up as a demonstration of some of the problems of the ‘fad’ of charity.
I admire you tremendously; going to a place where charity and aid are desperately needed, but are not necessarily fashionable at the moment.Report
Oh, FFS.Report
I dunno Katherine, poor ol’ neoliberalism is in a bit of a bind since defining it is never fun. Detractors from the right and left can alternately point out things like crony capitalism and immoral government/private enterprise partnerships and probably be on pretty sound basis.
The milder version of neoliberalism, though; trade liberalism firm development of markets with some significant government meddling in the form of safety nets and some redistribution remains pretty much the only model that has worked with regards to turning developing countries into developed countries. The traditional left models of pity/charity have been abysmal failures have they not with Africa the classic poster child. You mention several east Asia examples but none of them have improved their living standards through protectionism, heavy charity or command economies; it’s been through trade liberalization and economic development (often with good government* lamentably showing up after the development rather than before) that any progress has been made internationally has it not? I don’t see how some form of neoliberalism can’t be called transformative, especially in the case of Asia. Do we have any non-neoliberal alternative examples? I’m drawing a blank myself.
*As opposed to merely adequate government.Report
Katherine,
You have redefined economic liberalism to mean cronyism, the “freedom to loot,” and privilege — rather than liberty, freedom (to engage in mutually voluntary transactions) and the rule of law. You then label it capitalism and “neoliberalism”. Then you argue that this crony capitalist beast is harmful to human development.
It is not considered fair play to redefine your opponents terms to mean the exact opposite of what they intend. For the record, I too agree that giving someone looting privileges is contrary to economic development.Report
Katherine,
Might I recommend Charles Kenney’s Getting Better. He argues that while GDP per capita remains low (and not rising) for much of Africa, important factors are improving, including education (especially, perhaps, for womem), basic medical care, and sanitation/clean water.
And I would question whether we can meaningfully define as truly economically liberal any country with a fundamentally corrupt government. Or at the very least, we could certainly question whether the cause of on-going underdevelopment is economic liberalism or bad governance and corrupt government.Report
Africa’s done worse under neoliberalism than it was doing in the ’60s, in terms of the rate of progress in human well-being. Ditto with Latin America in the ’80s and ’90s.
Assuming arguendo this is true (that whatever mechanisms we are using to measure ‘rate of progress in human well-being’ are valid, and have apples and not oranges in the relevant columns, and that rate really has slowed significantly) isn’t it also possible that the 60’s were a time of low-hanging fruit, and that once a few of the easiest problems were more or less knocked out, the remaining ones were much more intractable/slower to respond to alleviation, thus slowing the rate of improvement? Or, that other factors were also involved (third-world population changes, poor economic policies, wars, etc.)?
It seems strange to seemingly lay the bulk of the blame for any stalled third-world progress primarily on increased trade with the first-world nations that seemingly have increased both their own wealth AND their willingness to share that wealth with others “not like them” during the periods mentioned. My (admittedly-unscientific) feeling is that first-world nations are less xenophobic and protectionist (and more internationally-charitable, as far as foreign aid and the like) than they used to be. Am I misunderstanding your comment?Report
You’re talking about liberalism generally, not neoliberalism, North. Neoliberalism isn’t strategic government action to benefit the economy allied with strong social safety nets; it’s government inaction and minimization, privatization of everything that can be privatized, deregulation, and disassembly of social safety nets in favour of cutting taxes. It’s been a disaster in eastern Europe, in Africa, and in Latin America; and it struck a major blow to East Asian prosperity when insistence on financial deregulation seriously damaged the ‘Asian tiger’ economies.
Countries have developed by managing and controlling their trade according to how they wanted their economies to develop, not by practicing unrestricted free trade. They’ve become decent places to live when they construct redistributive social safety nets. They’ve been able to have functioning governments when they’re able and willing to tax corporations and the wealthy, and to benefit from their natural resources rather than letting them be removed with no benefit to their citizens.
The left, and I, do not advocate pity. We advocate justice. We advocate ending exploitation of developing nations, ceasing to undermine their economies through agricultural dumping, ceasing to push trade agreements that involve them giving up their right to regulate the environmental activities of foreign companies. We argue that corporations which poison the land and water of developing nations and murder labour activists ought to face justice and be made to end these activities. We argue that loans to poor countries should not require them to increase unemployment and destroy their social safety nets, as those given by the World Bank and IMF have done. We argue that developing nations should be allowed to produce generic versions of life-saving drugs, which would save thousands if not millions of lives. We argue that deposing leaders that try to ensure their countries see some profit from their own natural resources has been, unsurprisingly, bad for those countries.
The large-government policies in immediately post-independence Africa that neoliberals love to deplore were more successful than neoliberalism. From 1960 to 1980, per capita GDP (constant 2005 USD) in sub-Saharan Africa rose from $650 to $900; from 1980 to 2000 it fell to $771. And the early progress was despite US interference whenever a leader seemed too left-wing for their taste (such as CIA-assisted assassination of Patrice Lumumba in the DRC and his replacement with Mobutu). Development professionals who worked in Africa over those periods describe the neoliberal ’80s and ’90s as disastrous, not just seeing an end to the progress that was being made, but active regression. Similarly, Latin America saw substantially greater economic progress during the 1960s-70s under import-substitution industrialization – which economists have chosen to declare a failure – than it did under the 1980s-90s neoliberalism, and has seen progress resume with a return to more left-wing economics in the 2000s. This is just raw correlation, but it’s at least sufficient to show that neoliberalism has certainly not been more successful in the developing world than other, more economic-interventionist, policies.
If people also want to donate money, that’s effective in improving the lives of individuals, even when it isn’t sufficient to develop the economy of a nation. It’s effective when it’s given to organizations that ask the local people what they want to achieve, and what they need in order to achieve their goals, rather than imposing our own goals on them.
For larger-scale achievements of aid, it can be credited with the elimination of polio and some other diseases (the Carter Centre, with other partners, is on the edge of eliminating schistosomiasis, an extremely unpleasant disease that involves worms incubating in people’s bodies and crawling out through their skin, and is caused by parasites in unclean water), and be given a decent amount of credit – with substantial credit also going to African governments – for the fact that despite continuing overwhelming poverty, the vast majority of African children get at least a primary-school education.
Your last point in a good one, though. The latest fad in aid by nations and international organizations is that we need to focus on “good government” rather than on education, health, and such, because good government is a prerequisite for development. Good government, even non-corrupt government, isn’t a prerequisite. Britain was the world’s dominant economic power when its civil service was still chosen based on family connections rather than merit.Report
Roger – I define capitalism as the policies pursued by capitalist nations, and neoliberalism as the policies pushed by nations and organizations that argue for small government and ‘economic freedom’. I prefer to speak about policies that actually exist, rather than an idealized version that exists nowhere in the world, but only in your mind.Report
Africa — like “America” and “Europe” — is one of those terms which ought to be used with more precision. Some African nations are doing reasonably well, others are just horrible. Furthermore, some of those Doing Well nations, notably Rwanda, have some serious human rights problems.
I knew Nigeria before and after oil. Oil hasn’t brought prosperity to Nigeria. Been something of a curse, truth to tell. But Nigeria’s a textbook case in corruption. Niger Republic is in terrible shape. Curiously, global warming has pushed the Sahara back a little bit. More hectares under cultivation now. Again, Niger Republic is horribly backward and corrupt, a staging ground for Boko Haram now afflicting the northern parts of Nigeria.
Neoliberal governments all start out with the best of intentions. That’s the problem. Good intentions lead to horrible results. They all end up degenerating into crony capitalism and nobody’s yet worked out how to stop this transformation.Report
I think I get your point Katherine and ya know what? I like it! The DLC did close up shop primarily because all the good parts of their agenda had been internalized by the entire mainstream left and they had nothing left to advocate that they could sell. The right and the GOP have gone wingdings at least partially because the better economic ideas of the moderate right have been appropriated from Clinton on to Obama so they were left to run off the reservation to the right. I’m down with defining what the successfully developing countries did as liberalism even if it wasn’t what constituted liberalism at the time they did it.
Now my quibbling: I do not think that large government policies in Africa can be described as successful when they ultimately led to bankruptcy, collapse, war and misery. I don’t think it’s plausible that all those nations were tipped over by malevolent neoliberals or conservatives. A lot of them did it themselves.
Beyond that quibbling I don’t have much to take issue with you over.Report
@North, Japan was able to modernize and industrialize in the 19th and early 20th centuries because it had a policy of protectionism rather than free trade. This wasn’t a perfect, it resulted in economy dominated by a few large and powerful conglomerates but it prevented Japan from suffering the same fate as other Asian countries. The United States also made good use of protectionism during the 19th century but arguably needed it less.
The problem isn’t protectionism per se, its how protectionism was used. If you combine protectionism with a more or less competent and not corrupt government like that of Meiji and Taisho Japan, you get decent results. When you combine protectionism with a corrupt and inefficient government like Brazil under the military dictatorship than the results are sucky.Report
“I prefer to speak about policies that actually exist, rather than an idealized version that exists nowhere in the world, but only in your mind.”
Um… I argued for property rights, the rule of law and economic liberalism (defined as freedom to produce and trade and interact with those mutually agreeing). Your argument is now that the rule of law, property rights and economic liberalism are figments of my imagination?Report
@north, I do not think that large government policies in Africa can be described as successful when they ultimately led to bankruptcy, collapse, war and misery. I don’t think it’s plausible that all those nations were tipped over by malevolent neoliberals or conservatives. A lot of them did it themselves.
I think that there’s also some demonstration of the opposite — large government preventing tribal warfare (I’m actually thinking Iraq and Libya, there are probably other examples).
@leeesq , didn’t the US have much to do with Japan’s industrialization after WWII?Report
The freedom to produce and trade and interact with those mutually agreeing — is even more ridiculous than Marxism. At least the Marxists understood the nature of power.
Freedom to do what, exactly? Agreeing with whom, precisely? Weasels will eat cornflakes before Freedom ever put a dime in a man’s pocket or fed his child or paved the road to his house.Report
Lee,
Correlation isn’t causation. All we can say for sure is that protectionism didn’t prevent Japan from developing.Report
The freedom to produce and trade and interact with those mutually agreeing — is even more ridiculous than Marxism.
That’s odd. I thought that was how you made your living.Report
North – Can you give specific examples of what you mean when you speak of large-government policies in Africa leading to bankruptcy, collapse, and war? The debt crisis in Africa (as in Latin America) wasn’t due to debt levels that were inherently unsustainable, but to the US sharply raising interest rates in the late ’70s to combat stagflation, which led to high interest accruing extremely rapidly on debts that were previously fairly manageable. Plenty of African countries remained stable up until the conditions IMF and World Bank loans forced them to cut back government expenses to the point where they couldn’t afford to maintain minimum levels of stability and security. (Even the IMF and WB have now recognized that there is such a thing as too little government, and that forcing African countries to have excessively weak governments produced serious negative effects.)
There were certainly problems with the governance of many African countries in the ’60s and ’70s – in particular, an excessive level of personalist rule by independence-era leaders, and often ethnic favouritism – but Africa was making substantial progress under their more left-wing, state-involved, independence-oriented economic policies, in contrast to regress under right-wing minimal-government policies. Reforming flaws in the early independence-era policies would have done far more good than repudiating them outright.Report
Heh. No, James. I promise not to lecture you on professoring if you won’t lecture me on consulting. Freedom is an illusion. Necessity, my friend, is the MoFo of Invention. Freedom means Unemployment. Air pudding for dessert.Report
@jm3z-aitch, you can’t ignore examples that you don’t like by saying “correlation doesn’t equal causation.” I think that considering the geo-politics of the time, protectionism was a good way for what we would call developing states to go. If the Japanese government did not go the protectionist route, they would have been flooded by cheap, foreign goods and its unlikely that modern industry and business would have developed at the level they did.
@zic, Japan was already on industrialized nation on the eve of WWII. What the destruction of WWII allowed was for Japan to rebuild its industries with the most modern technology all at once rather than doing a slower transition like other developed countries.Report
Lee,
Sorry, you csn’t prove protectionism was necessary for development. That just about every state had done it that way only proves that it can be done that way, not that doing it that way is necessary.Report
Blaise,
So which party in your consulting is not freely making an exchange? Are you the one who’s not free to make the exchange or not? Is the party hiring you not free to make an exchange?
Don’t hide behind vague and abstract statements. Be explicit and clear about which party is not freely participating in your exchanges.Report
There’s no hiding. What part of contract don’t you understand? Sure, there’s all that business about Freely Entering into a contract. Most of a contract deals with how that Freedom is constrained. It’s perfect nonsense to say otherwise.
I’m not free to just do as I like in the context of my job any more than you are. I work because I have to work. I work at the best rate I can obtain, often through pimp middlemen who get a cut. Where the sam hell does Freedom enter into that? What makes you think I can just quit, either? In consulting, you fart once and everyone will smell it. Get a bad rep and nobody will hire you.
The Libertarian concept of Freedom is completely uninformed. It’s criminally absurd. Nobody just walks away from one job and into another without consequences. I have to take what’s on offer at rates on offer. I have to provide more than mere value for money, I am also a designated blame-taker, ad-hoc trainer, alligator wrestler, middleman and general butt boy. If I’m lucky, sometimes I get to code.
Really, James, you haven’t defined Freedom adequately. Get around to Market Forces, competition, lying assholes who will underbid me then attempt to bring you in once they’ve got the contract. Dude, there’s no Freedom in anything I do. I don’t get to do the work where I’d like. I don’t get to determine who I’m reporting to. What the hell is remotely implied by Freedom? You might as well try defining Grace or Predestination or Original Sin.Report
What part of contract don’t you understand? Sure, there’s all that business about Freely Entering into a contract. Most of a contract deals with how that Freedom is constrained. It’s perfect nonsense to say otherwise.
Yeah, all that business about freely entering a contract? That’s about the freedom to decide whether what you get out if it is worth the constraints. Nobody is talking about unconstrained freedom to make money without having any contractual constraints.
Either you know that and are deliberately misrepresenting what we’re saying, inwhich case you’re despicably dishonest, or you don’t know that, in ehich case you’re shockingly ignorant. Eithet way, you’re not actually addressing what we’re talking about, so your criticisms are pointless and off-base.
It’s really just a college bull session argument and no more. “Dude, like you have freedom to enter a contract, but the contract limits what you can do, so you’re not really free. Like, freedom leads to unfreedom.” “Whoa, that’s heavy dude. Hey, don’t bogart the bong man!”
THat’s all you’ll gey from me. I’m done wasting time on this particular one of your little sophomorisms.Report
Are you implying dishonesty on my part? You get this way when you’re cornered. You need to define the axes of Freedom here, buddy. I say Freedom by your lights equals Unemployment.Report
No, Blaise, I’m done wasting time on your sophomore bull session.Report
Well of course you’re done. As always, when you’re out of argument, you resort to insult and bluster, James. I know you well enough. I wish every would-be Libertarian would be forced to work as a solo contractor for two years. Cure his stupid ass of every trace of Galt-ism.Report
@katherinemw
Funnily enough, I’m working on my next trade sequence post that addresses this very argument.Report
…Or, to put it most simply: at the end of 2011, we would have predicted a certain amount of tax avoidance in 2012 (despite the absence of a significant tax-hike that I’m aware of – though maybe some Obamacare taxes were going to kick in – so, make it 2006 predicting for 2007, or any year where there was predominantly continuity in tax rates from year to year). What’s not to complain about?Report
Oops, that comment is in the wrong place.Report
Creon,
I kind of agree, but am leery of your use of the phrases “collective,” and “collectively off the hook.” If this means using peer pressure and persuasion to encourage more aid, then I am all for it. If this means you imposing your will and values and definitions of justice upon me, then I disagree in principle.Report
Roger,
I agree with you that peer pressure as an important piece in the puzzle. It would be great if we had more “to die rich is to die disgraced” Andrew Carnegie’s out there in the world. However, we can’t be sure that the haves of the world will take up their responsibility to aid the have-nots. So yes, collectively we need to tax away some of their wealth (while they’re earning it and in estate taxes) and devote it to investments we as a society value. If that means some fat-cat has to fly first class instead of taking the G-IV out for a spin, well too bad. I care dramatically less about that millionth dollar consumption decision than I do about the thousandth, or hundredth, or second dollar consumption decision of the working poor, poor, and those in extreme poverty.
Moral suasion is not the only tool in the kit for society, and thank goodness for that. Being a member of the community, to me, means reciprocal rights and duties. Your perspective, as I’ve encountered it in the past, tends to be heavy on the individuality/rights from society element and light on the duties element, especially when discussing redistribution by fiat (I understand this is a feature, not a bug by some lights). I respect the claims the wealthy have to their wealth, but to me their are significant countervailing claims: social justice, social and economic rights, an obligation to ensure everyone leads a life with dignity. In the end, my principles can withstand that that millionth, or billionth dollar going to a social good as directed by the state rather than sometimes highly dubious consumption choices of the wealthy.Report
And though Emperor Creon has a nice ring to it, I think as an output of liberal democracy taxation to achieve the aims I described is wholly legitimate.Report
Creon,
That the rich person probably pays more overall in taxes (including property and sales taxes) even with flat rates, and is frequently more responsible for the creation of wealth enjoyed by others than anyone else indicates a person who is not meeting their social responsibilities?Report
@jm3z-aitch
I’d say judge whether the rich are meeting their social responsibilities by the well-being of the poor.Report
That the rich person probably pays more overall in taxes (including property and sales taxes) even with flat rates
Percentage or fixed amount? Are you considering the utility of money — that is, a dollar is effectively worth far more to a poor man than a rich man?
and is frequently more responsible for the creation of wealth enjoyed by others than anyone else indicates a person who is not meeting their social responsibilities?
Assumes as fact something that is not established as such.
Paris Hilton is ridiculously rich. How has she created wealth? The Walmart family is ridiculously rich — but it’s quite arguable that the creation of their wealth destroyed it for many.
And then there’s the financial sector — what wealth was created in the 2000s as house flippers got rich — then got underwater? As banks went bankrupt even as their owners or CEO’s walked away with fortunes? Where was the wealth creation?Report
James,
rent-seekers, those who profit from other people’s investments (primarily their parents), have no right to insist that they’re More Responsible for wealth creation than the next bloke.
Their investments are made by some physics geek (or maths nerd), who they pay to do it. CALPERS could do the same with its money. If it did, would it magically become “more responsible” and thus less deserving of taxation?Report
“That the rich person probably pays more overall in taxes (including property and sales taxes) even with flat rates”
Percentage or fixed amount? Are you considering the utility of money — that is, a dollar is effectively worth far more to a poor man than a rich man?”
Why does percentage necessarily matter? If someone’s contributing more they’re contributing more. And why does utility to the person matter? I thought you were talking about value of contributions, not value to the individual, so shouldn’t we just focus on the rich man’s dollar having the same utility to the public coffers as my dollar? Or are we not contributing equally until we feel it equally, and what would be the logic supporting that?
“and is frequently more responsible for the creation of wealth enjoyed by others than anyone else indicates a person who is not meeting their social responsibilities?”
Assumes as fact something that is not established as such.
Bill Gates is more responsible for wealth creation than you and I and a very large number of other people combined. I don’t think there’s a serious case to to made against that.
Paris Hilton is ridiculously rich. How has she created wealth? The Walmart family is ridiculously rich — but it’s quite arguable that the creation of their wealth destroyed it for many.
I reject the Wal Mart argument, no matter how many times I hear it, because it’s never really persuasive. Yes, in a competitive market you can financially destroy someone by outcompeting them. But you cannot normally do so without creating a net gain in wealth.
Paris Hilton is an interesting case. Assume she’s created no wealth–are you willing to set up a standard for distinguishing between the wealthy who’ve not created wealth and those who have, and charge the latter less?
But really, do either os us know whether she’s created wealth or not? What does she do with her wealth? Is it investedr under her mattress? If it’s invested, others are borrowing her money and being productive with it, so she is creating wealth (although the borrowers are doing the heavy lifting, of course).
And then there’s the financial sector — what wealth was created in the 2000s as house flippers got rich — then got underwater? As banks went bankrupt even as their owners or CEO’s walked away with fortunes? Where was the wealth creation?
So, bubbles happen, so nobody ever actually creates wealth? Or just that sometimes bubbles happen and no real weakth is created by them? I don’t deny the latter. But at best what you’re doing is providing exceptions to the general case. If you want special rules to deal with the exceptions, I’m willing to listen.Report
@creon,
I’d say judge whether the rich are meeting their social responsibilities by the well-being of the poor.
If you want to go that route, why limit it to the rich? I’d say follow Jesus’s standard, or like Bikram you’re still making excuses.Report
Creon,
“However, we can’t be sure that the haves of the world will take up their responsibility to aid the have-nots. ”
You are assuming they have a responsibility, and assuming that we all agree what that responsibility is. If they do indeed have a responsibility then I expect us to be able to persuade them of it.
“So yes, collectively we need to tax away some of their wealth… and devote it to investments we as a society value.”
I agree there may be public goods and such which are best provided publicly.
That said, what you are really saying is that you believe the master planners can as a rule allocate resources wiser than individuals. That we replace the decentralized priorities of the millions and replace it with the benevolent wisdom of our betters. You are saying that rather than me investing in a firm building a factory in Thailand, that I should hand my money to a group with better ideas.
You are quick to note that the haves may not choose to allocate their money as you want them to. You are less adept at noting that your master planners may not send it where we want either. You also miss that they (or the collective we) may not be capable of knowing where best to invest/spend it. You miss that the planners may not actually be benevolent, indeed they may even be selfish and power hungry. You miss that redistribution influences incentives and reduce the size of the pie. You miss that redistribution also creates dependency both of those receiving it and of those making a living off facilitating it. Finally you make the economic mistake of counting only what is seen and ignoring what is unseen.
Honestly, Creon, I wouldn’t trust anyone you would empower with a nickel of my money. I am absolutely sure they would make the world a poorer and less desirable place. I would conscientiously try not to earn a nickel just to keep their pathologically altruistic hands off it.Report
@jm3z-aitch
What’s fascinating to me is the extent to which some of these propositions comfort the consciences of the already incredibly comfortable. We have the initial post, “the best way for me to do good is to do what I already was doing.” We have your rich as “frequently more responsible for the creation of wealth enjoyed by others than anyone else”. The have-nots encountering serious difficulties meeting basic needs, never mind them, because we are already doing enough to alleviate their suffering. How? By consumer capitalism! How incredibly convenient for us that our social/moral/ethical responsibilities have been satisfied by a system that (locally, nationally, globally) advantages the already advantaged so very much. These the status quo is a-okay answers, and their ilk, are profoundly unsatisfying to me. So yes, perhaps there is good reason to turn to religious texts – if you want to get your faith tradition involved, I’m perfectly happy to pose these questions absent any faith – and ask ourselves some difficult questions about social justice, human rights, and the haves claims to desert.Report
Weighing all in the balances, Microsoft have done as much or more harm than good. Here’s a sovereign case in point. Microsoft Word.
Two separate problems emerged with the personal computer: displaying things on a screen and printing them on paper. Editing a document would be considerably more straightforward if these weren’t such separate problem domains.
Two separate approaches must be considered. One, such as TeX, goes down the typesetting paradigm, wonderfully exact printing. The other, HTML/CSS, is meant to control layouts for browsers but doesn’t do such a great job of controlling printers.
I am not a technology zealot and despair of those who are. Things ought to be much simpler than they are. The untold billions of wasted man-hours spent wrestling with a badly-designed tool which never mastered either layout or printing weigh heavy in the other pan of the scales of wealth creation. Microsoft was a troll under the bridge, collecting a tax every time someone tried to cross it.
Let’s not even get into the pernicious effects of PowerPoint on business culture.
Competition is good, while it’s a force at work in the market. These things sort themselves out: soon enough one player comes to dominate the space. When that player appears, evolution gets very weird. Then all sorts of cosmetic differences determine natural selection, nothing fundamental. The benefits accrue to fewer and fewer. Barriers to competition arise.
Microsoft raised such effective barriers to competition the only one to really survive was Linux because it was free. And don’t say Apple. Microsoft dominated the Mac applications software market for years — with Microsoft Office.
When the issue of wealth concentration arises, we’re told Bubbles will solve the problem. They don’t. The sharks have been the top predators in the ocean for half a billion years.Report
Creon part two,
“If that means some fat-cat has to fly first class instead of taking the G-IV out for a spin, well too bad.”
You just justified taking from those people and actions you have disdain for to give to those you prefer. This is morality paid on another mans’ dime.
You also ignore the economic development of paying the working class family like my daughter’s who is employed in the aircraft construction business — let alone the countless unknown people she pays out of her salary.
You have allowed envy to blind you to the positive sum nature of free enterprise. When I go to the movies, or you eat at a restaurant, or the hated fat cat flies his jet we are not harming anyone. We are creating positive sum value. We are generating utility for all parties, utility which can later be voluntarily given to save starving kids in Haiti. I reject the role of anyone to elevate their opinion to a privileged position of dictating which trivial pursuits are socially acceptable or not.
” Being a member of the community, to me, means reciprocal rights and duties.”
Oddly, we are actually talking about transferring duties outside the community, from the first to the third world destitute poor. But to your point, I am hunky dory with rights and duties. I ask that they be fairly agreed to. Let me know the package deal and give me the freedom to choose behind a veil. I choose liberalism, which includes property rights, economic freedom, safety nets and government delivery of public goods. I also choose the ability to defend myself from those wishing to force me to renegotiate the terms of the agreement.
Are those rights and duties acceptable to you?Report
Nobody begrudges the Fat Cat his bizjet. But when that Fat Cat then howls about the inequity of giving his workers a raise, you will excuse me a little sneer, won’t you? The lacemakers of France were all in a tizzy when the Revolution came along. Fashions changed somewhat. Lace ruffles were Right Out, for most of the necks which sported them were severed.Report
Roger,
You are assuming they have a responsibility, and assuming that we all agree what that responsibility is. If they do indeed have a responsibility then I expect us to be able to persuade them of it.
I’m going to use a variant of the age old, “if you live in my house, you’ll obey my rules” here. If the haves are to go on living in this political community, they’ll have to abide by a set of decisions we make together. I don’t necessarily have to convince them to do right by the have-nots. For the foreseeable future your locality, your state, your country, the United Nations system, the international community… we will be making resource allocation decisions. Convince enough participants in the system and the scale shifts towards more resources towards some particularly significant public goods. So I may never convince Peter Thiel, or the Koch brothers, or the Waltons that they have responsibilities to the community that’re currently going unmet. That’s fine. As a self-governing political community we’ll have a dialogue about it, make competing arguments and that process will yield a result. (And in two, four, or six years time we’ll have the fight all over again.)
what you are really saying is that you believe the master planners can as a rule allocate resources wiser than individuals.
Master planners as a rule wiser than individuals, what a bold claim! It is a good thing I didn’t make it. Government can sometimes do things more efficiently, individuals can sometimes do things more efficiently, and probably the reality of day-to-day life, the government and individuals (or private entities) work cooperatively to achieve all kinds of laudable goals. On balance, I probably do trust the state to take on more responsibilities, and I probably do draw the circle of public goods wider than you would.
I think something you might fail to appreciate is that I can point to a bunch of functioning states that take on some of these tasks: national health, early childhood education, some publicly owned financial institutions… All these functions being carried out without dystopian, totalitarian, nightmarish calamity. The US on the other hand, for such a wealthy society, has some extremely perverse outcomes on some crucial social welfare measures: infant mortality and medical bankruptcies immediately spring to mind.
The specter of selfish, power hungry (so-called) master planners looms less large with the knowledge that so many other developed countries have managed to get positive outcomes with more government involvement.
I wouldn’t trust anyone you would empower with a nickel of my money.
It is a good thing Obama’s already in office then. Though I do find him a bit timid on the progressive agenda score…
I would conscientiously try not to earn a nickel just to keep their pathologically altruistic hands off it.
Now you just sound kind of spiteful. “[P]athologically altruistic”, that’s an interesting criticism. I’d be curious what institutions you’d put in this category, the ICRC? UNICEF? IRC? UNHCR?Report
Roger, part two,
Regarding G-IV’s, I was attempting to offer a vivid example of how the kind of sacrifice the wealthy will be forced to make in the course of belt-tightening does not compare to the kinds of sacrifices the have-nots have to make, continually. It is not a big sacrifice to move from G-IV to first class, while it is a big sacrifice to be unable to afford tuition to primary school. Similarly, building a $1 billion+ home deserves a critical look.
morality paid on another mans’ dime.
Well you’ll note that I am not, much to my chagrin, currently Emperor of the world. I’m merely offering an opinion. So that billion dollar manse in India is standing, and the haves are free to go for joy rides on G-IVs. I do object to the envy criticism. First, I’d never be so gauche as to build a billion dollar home. Secondly, according to the self-same economic theory, were I to inhibit certain kinds of conspicuous consumption, the resources would be directed to to other ends. Maybe they’d be ends I’d continue to disagree with, bidding up the price of some already overpriced artwork. But it is also possible that the resources would go towards something of more benefit to more people. I am not convinced by the “there are average people in the luxury goods industries” line of argument; were I to close LVMH by fiat tomorrow (not that I’m advocating for it), those people and their skills could be used elsewhere in the economy.
When I go to the movies, or you eat at a restaurant, or the hated fat cat flies his jet[…]
I’ll also note, there is quite some distance between, movies and restaurants on the one hand and G-IVs on the other. At some point a difference in degree becomes a difference in kind. I haven’t argued we all need to lead ascetic lives. I began with merely calling for questioning a status quo that didn’t call upon us to do much besides consume.
we are actually talking about transferring duties outside the community, from the first to the third world destitute poor.
I’m not sure I’ve understood this correctly. But I’d say that it isn’t a competition between poor in various settings and circumstances. We, the state, the community, the international community, etc… ought to help the have-nots in all these circumstances. Ideally, irrespective of geographic boundaries.
Are those rights and duties acceptable to you?
Once you take it up to a certain level of generality, sure the list as you’ve described it is fine with me. But we likely have large differences as to particulars. For instance, when you say rights, do you mean second generation, freedom from want, economic and social rights too? How far is the government free to go in ensuring second generation rights are met? And then when it comes to particular policies we may end up being even further apart. Or put it this way, there was a discussion not too long ago about pay-day lending. I found it exploitative and abusive of people with few alternative financial options, and I’d suggest a public option, a publicly owned bank whose mission includes serving those who’re currently unbanked. You good with that?Report
@creon-critic : UNICEF and UNHCR are great money-wasters. In terms of bang for the buck, they’re not very good. Badly administered, prone to graft and internal theft. UNHCR in particular can’t run a refugee camp: cases in point, the Palestinian, Lebanese, Chadian and Pakistani refugee camps. The Palestinian camps are especially bad: controlled almost exclusively by gangs and militants.
It’s not as if they don’t do any good, they do. But they don’t do nearly as much as they could do with the money they’ve been given.Report
I can’t speak to every charity work’s particular problems. I can speak to refugees. It’s been my observation most of humanity’s observable problems, the ones where we end up sending aid, have underlying societal components. Hurricane Katrina, case in point. Yes, it was a terrific natural disaster, an Act of God as they say in the insurance business.
But much of the resulting suffering arose from building in flood plains and inadequate planning for an entirely foreseeable disaster. Wars produce refugees: people are still displaced from the Iraq War. Syria has produced over a million registered refugees.
It’s not enough to feed people, bandage up wounds, run a sanitary refugee camp. Humankind must learn another sort of charity, one which pushes back against the criminal madness of war and bad governments, a sort of charity which can strike down the causes and not merely the effects. Three generations of Palestinians have grown up in refugee camps. Lebanon won’t allow them to even work in their country. Hamas can haul out suspected “collaborators” and shoot refugees in the streets, right under the noses of the supposed Refugee Camp Administrators.
The dialectic of Haves and Have-Nots is irrelevant. The millions of Have-Nothings in the refugee camps of the world used to be Have-a-Littles. The nation-state is failing. Something or someone must eventually step in. Can’t be the USA, we’re getting tired of being the World’s Policeman. What’s more, the USA won’t make itself subject to the International Criminal Court. Until humanity evolves some methodology for dealing with the fallout of these conflicts and disasters, confronting the Haves who start these wars, the rest is kinda pointless.Report
These the status quo is a-okay answers,
I hope you’re referring to either Roger or me, because that would be a real mischaracterization of our positions. That you would not necessarily like pur proposals does not mean we advocate the status quo.Report
@creon-critic
Similarly, building a $1 billion+ home deserves a critical look.
Heh, I can’t understand how someone could really want a house like that, but that’s irrelevant. The relevant question is where does that $1 billion go? Is not putting that money into the pockets of local contractors something we should appreciate? Or do you find it a better thing to take the money and redistribute it without the billionaire putting people to work?
I had to replace a rotten foundation beam this summer. The quote was $1700, which was more than I wanted to pay, so a friend and I did it ourselves for less than $100 bucks in material and equipment rental. Who did more for others in their local society, me, or the guy who built a $1 billion house.Report
@jm3z-aitch
I’m not trying to capture the totality of your (or Roger’s or Vikram’s) positions in that shorthand. I’m saying, insofar as the analysis presented yields such untroubled conclusions I’m wary. Your question’s attributing a good deal of wealth creation to rich people connects up quite nicely to a broader justification of current economic/social arrangements. Certainly more than to a challenge of such arrangements.Report
@jm3z-aitch
Is there any conceivable ultra-luxe expense that doesn’t pass your test? I’m sure with some time I could think of quite a few charitable institutions, not least in India, that could better deploy $1 billion, rather than for building a home for six people.Report
Your question’s attributing a good deal of wealth creation to rich people connects up quite nicely to a broader justification of current economic/social arrangements. Certainly more than to a challenge of such arrangements.
It all depends what alternative we’re talking about, doesn’t it? What I’ve seen so far from some folks here–although primarily folks who aren’t you–sure reads as an attack on the wealthy as non-wealth producers, as keaches on society who are probably overall wealth destroyers. That logic justifies an alternative system all right, but not the kind that’s ever done a good job of making people better off.
If you’re just arguing for an increase in marginal tax rates, I have no real objection. We’ve had higher rates before without killing the golden goose. But the standard given for determing whether they’ve paid their share–whether there are still people in poverty–necessarily leads to higher tax rates than we ever have had before, and I think there are both pragmatic problems and problems of justice there.
And frankly, there seems to be a bit of he who has sinned casting stones. If we–you, me, the middle class–are not doing our share (and if there are still people in poverty, how can we say we have?), then how are we justified in focusing on the upper class? It really does strike me as another way of excusing ourselves from doing more.Report
Is there any conceivable ultra-luxe expense that doesn’t pass your test? I’m sure with some time I could think of quite a few charitable institutions, not least in India, that could better deploy $1 billion, rather than for building a home for six people.
Creon,
I can think of countless things I pesonally think are better. But I’ve got two qualms about your question.
First, you haven’t really addressed the question I’m pushing you on. Is the rich guy doing good for other people, making them better off with his billion dollar house or not? And is he doing more or less good than middle class me who only spent $100 in my community rather than the $1700 I was quoted? Which of us has already done more forvthe well-being of others?
Second, do we really want to go down the path of “If I can think of a better use for your money then we’re justified in taking it from you?” Because there are kids dying of malaria and/or malnutrition, or who can’t get an education, or don’t have safe drinking water, and if you tell me you don’t have any luxury items that are less important than that I’m going to doubt you, so why shouldn’t we take a lot more from you in taxes?
Why is it only about the rich? Why not apply your standard to all of us? That trip to Harry Potter World at Universal Studios I’m taking my kids on for Christmas? Even though we’re going frugally, that’s not as important from saving even one kid from malaria. So why are you giving me, and yourself, a pass and only holding the rich to account? Not one argument you’ve made so far is logically restricted to the wealthy, and as I am arguing, the wealthy guy who spends money on a billion dollar house has already done more for other people’s well-being than I. So I’m struggling to see where your argument is really principled, and not just based on dislike of the wealthy.Report
@jm3z-aitch
Part of the reason for the focus on the wealthy is they possess so much of the wealth nationally speaking, and even more so globally speaking. More inequality, more gains from productivity going to the wealthy, and a stagnating middle are all reasons for concern to me. But I did not exclude anyone from my comment at 12:47pm.
I wouldn’t put it in “leaches”, “wealth destroying” terms. I do accept some arguments about the kind of exploitation that goes under-remarked upon if we’re all meant to be celebrating free trade, sweatshops, and (so-called) voluntary exchanges. To the extent that trends continue towards substantial gains for the already wealthy while the vast majority of the populace stagnates and falls behind, I worry about social cohesion.Report
while the vast majority of the populace stagnates and falls behind
I’ve made my position on this clear before, so I won’t reiterate the arguments, but I don’t agree with this claim. So while I don’t dispute that you believe it and that it motivates you, it falls on deaf ears with me. And it still slunds to me like you’re seeking to excuse the middle class’s 2,500 square foot houses and big screen TVs.Report
I wonder what Africans think about how bad the middle class has it.
Seriously, if we’re talking about where money is “best spent” in the spirit of humanity, not only are our own consumer choices suspect, but our government spending is, too. Think we should spend money helping Americans go to college? How many Africans can’t read? Food stamps in an obese nation? Whatever you think the government should be doing for poor and middle class Americans, I can guarantee you that I can find a more urgent use for that money.
The only reason we don’t do this is a recognition that the wealthy are allowed to be ridiculously wealthy by somebody else’s standards. Which, by somebody’s standards, we all are. It’s a tricky balance, wanting to do justice but not going crazy at the injustice of it all and your own complicity in it. Focusing on the primary complicity of those wealthier than you is a bit too simple.
So is my own response, which is to just shrug at my selfishness and bigotry.Report
@jm3z-aitch
Is the rich guy doing good for other people, making them better off with his billion dollar house or not?
Yes, he is doing some good for other people.
And is he doing more or less good than middle class me who only spent $100 in my community rather than the $1700 I was quoted?
Yes, when judged by economic impact he has done more spending $1 billion than you did spending $100.
Now, my point was that every luxury item purchased (priced more than $100) passes this test. To me this is a low, low bar. A bar by which the Bourbon monarchs become worthy humanitarian for Versailles, look how much good they did for the peasants who furnished their rich lifestyle. How much good did he do and how much more good could he have done for people in more dire straights with that $1 billion? Those are also questions that I’m keenly aware of. Also, I’ve mentioned it earlier in the thread, “At some point a difference in degree becomes a difference in kind.” Your or my $50 can not make change the way $1 billion can. Your vacation with your family, still not at the $1 billion worth of change level.
Or put it this way, suppose prior to spending the $1 billion on a house for 6 he had written to you. Professor I would like to do good for the word with my billion dollars, what would you recommend? Do you think anywhere on that list you’d put, build a 27 story (60 conventional stories) house for yourself and five family members? In India no less!
do we really want to go down the path of “If I can think of a better use for your money then we’re justified in taking it from you?”
Not quite the path I’m taking but yes, my path leans towards a “soak the rich” argument. That is where the money is. Because a generic fat cat has so much and so many have so little, we are justified in taking some from billionaire A and giving some to $2 dollar a day Indian citizen B (for my purposes that taking occurs in the context of a liberal democracy and that giving can be in the form of services like schooling, health care, etc.).
so why shouldn’t we take a lot more from you in taxes?
Yes, we ought to tax more. Especially those who can most afford it. The broadest shoulders should bear the greatest burden.
Why is it only about the rich?
It isn’t only about the rich, but in this case their shoulders are really broad. I’m not advocating taxation out of animus towards the wealthy, I’d advocate taxation because, again, that’s where the money is.Report
Africa’s developing a middle class. Nigeria’s got a thriving middle class.Report
Creon,
I’ve already said I’m comfortable with higher marginal tax rates. But I’m not clear how far you’re willing to go to soak the rich. Bill Gates is worth $72 billion. How much should we take?
When someone wants to spend a billion on a house, what should we do? Should we say no and confiscate a bilion?
I really don’t know what your alternative consists of, whether a return to pre-Bush era tax rates, a >100% marginal tax rate for incomes over a million dollars, confiscation of the property of the rich to auction off and redistribute the proceeds, or…? I’m just hearing “more” (and possibly, “they shouldn’t be allowed to build mega-mansions”), but I have no idea how much more.Report
@mal-blue , @jm3z-aitch
Regarding not excusing ourselves and the middle classes, I suggest for your consideration a Crooked Timber post What sorts of intellectuals should there be? by John Holbo. Maybe the bit particularly relevant to this discussion, Holbo quoting George Scialabba,
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I don’t know, Creon. I suspect telling a nation of middle class people that the rich need to pay more isn’t the hammer blow that telling them the middle class needs to pay more would be. Pointing to the rich is not new, unusual, or shocking. The Bible verse I quoted? That was Jesus talking to the rich. It seems to have been a hammer blow for that guy, but 2,000 years later? Heard itl al before.
And pragmatically, keep in mind that by virtue of being rich, the rich have more means to hide their income than we in the middle class do. Soak them, sure, but don’t complain when they act as predicted and find means of tax avoision. You have some room to operate, but not as much as you would like.Report
Was a day, back in feudal times, when the rich quite sensibly feared the poor. The key to feudalism is coming to grips with loyalty structures, which went both ways, from high to low and low to high. Masters always feared slaves and serfs, knowing the true score kept the lords and masters on their toes.
Once enough disaffected people gather in a mass, they will form a mob. That’s bad business for authority structures of any sort. Both sticks and carrots, threats and rewards, would keep things in line.
Been a while since America has seen a mob in action. Late sixties, by my measure of things. A few disastrous episodes, the OJ Simpson trial comes to mind. When the rich overstep their bounds, they’ll learn the lesson of feudalism again. The hard way.Report
The key to feudalism is coming to grips with loyalty structures, which went both ways, from high to low and low to high.
An important distinction with slavery, as it is feudalism’s one saving grace.
(As opposed as I am to rigidly hierarchical social structure, I often wonder if human nature isn’t most well-suited to feudalism. Hopefully that’s just an unearranted pessimism.)Report
@jm3z-aitch
Higher marginal tax rates is a good start.
Bill Gates is worth $72 billion. How much should we take?
I like the French solidarity tax on wealth, 1.5% on wealth about €10 million, with certain exemptions. The US keeping the estate taxes is a good idea.
When someone wants to spend a billion on a house, what should we do?
Break out the guillotine.Excoriate them in the press.a >100% marginal tax rate for incomes over a million dollars,
No, but I do have to say I was heartened when I found out the top rate of tax in the UK, during one of the world wars, was 99.25%. Overall, the whole Reagan-Thatcher revolutions have gone pretty far in the direction of lowering taxes. We’re overdue for a pendulum swing in the other direction towards the rich paying their fair share. Also, the Bush administration’s whole fighting wars while cutting taxes, very bad idea.
As for tax evasion and avoidance, I’m glad there have been gestures towards greater international cooperation in cutting back on that sort of thing at the G-20. It is well past time to take steps to curb (and punish) international free riding by tax havens.Report
So, basically, we’re just asserting that the wealthy do or do not create due to their wealth, using whatever examples come to hand. Argument by anecdote.
I’ll happily admit that. Will you? And if you do, and admit that “the wealthy create wealth as they amass wealth” is supported only be anecdote and belief, how does your thesis stand?
Mine’s fine with the notion of the wealthy creating — I still think utility of money is a huge factor, that a large middle class does far more than a wealthy elite by simple math in terms of pushing economic growth (a wealthy man will invest his 10% increase in income, a middle class man will likely spend it — and if there’s anything the US has a glut of, it’s investment funds).
I also dispute the notion that the wealthy pay the same in taxes, even if you ignore utility of money — I know a bunch of hedgies that are laughing about that as they light their cigars with 100 dollar bills.Report
Though Jefferson channels Rousseau in saying “all men are created equal” — they sure don’t stay that way, do they? What about women? At the time, nobody even contemplated equality for women, though a few women were doubtless muttering through their clenched teeth about the inequities they suffered. I’ve always admired John and Abigail Adams: there’s a husband who understood the brilliance of his own wife.
If humankind is to harness the power of capitalism to the benefit of everyone, including our fellow travellers, the animals of this planet, seems to me we need to change our outlook on nations and economies Zoos were once horrible places. Marlon Perkins took a different approach. That hugely enlightened man turned the zoo inside out, making of it a Noah’s Ark, a place where animals could thrive. The yardstick for thriving is reproduction: a sentient creature like the great ape can only reproduce where he’s reasonably happy.
What if we took the same view of our fellow men? Life has already confined us to our super-specialised perches and economic ecosystems. Might as well treat the poor at least as well as we would zoo animals, believing they deserve humane treatment. For one, we imprison too many of each other for frightfully stupid things. I have no patience for those who pity the violent criminal, he really must be kept locked up, with every rational expectation he’ll bite to kill, as surely as a Siberian tiger. Crime must be viewed as society’s failure at some level. Either the crime itself is stupid, the criminal is stupid — or we’re stupid. Looking at the human experience all wrong. Bad inputs, bad outputs. Our efforts should be applied to little kids, turning them into productive tax payin’ family-raisin’ citizens and not jailbirds.
We know who fills the prisons. It’s the poor. One of the wrongest conclusions people reach about American crime statistics is how disproportionately black people are locked up. It’s not because they’re black. It’s because they’re poor. The white and black poor — all the poor appear in prison with statistical congruence with their poverty. They can’t afford good lawyers, that’s the main reason.
Pity is contemptible. Mankind has always lived in hierarchical societies, whether or not he wants to admit they’re hierarchical. In an ideal world, the philosophers do become kings, reluctantly and modestly assuming the burdens of leadership. This ain’t an ideal world. If we are to enjoy the blessings of Liberty, a good deal of Structure is required to support it.Report
You know, both things can be true at the same time.
Rich people create opportunity for other people. I’ve helped launch companies that have created hundreds of jobs and are growing with investments. Key to this, I think, is high-growth. Once you reach a certain point of big; you’re just floating and probably go both ways in all sorts of ways. But holding at 30,000 jobs is holding, not growth. And a lot of money goes there; into big companies that are floating, and often times crowing out smaller competition.
And rich people sometimes suck money out of the system that they don’t put back in.
They also see wealth destroyed quickly, usually without being devastated by it; they’ve got comfy cushions, and recover quickly, though not always to their previous levels.
Morat20 mentions hedge funds; that’s troublesome. High speed trades. They just suck value out of the system from small investors without creating growth. They strip wealth away from the middle class. And yeah, I know the argument about revealing things to the markets.Report
@zic : both are true. My son did some work on this problem, saying for the poor to be lifted out of extreme poverty, the rich will have to become astronomically rich. It’s all quite possible, it’s not a zero-sum game. The key, he says, and he’s a better mathematician than I’ll ever be, is to watch the movement of money in the economy. Poor people spend every dime: they don’t have much of a choice.
Now he says, still astonishes me, the best use of taxation is to give let the poor a stipend and let them blow their money on whatever they want. It all ends up back in the economy and makes the wealthy wealthier. Encourage the poor to game the system for a good long while, go get some two-bit part time job, won’t affect their stipend. No subsidised this ‘n that, they get cash, that’s it. Gets the poor rolling down the runway. Soon enough, they’re making more money in the private sector, it starts showing up in bank accounts, they’ll be able to retract their landing gear and start flying around on their own. Whatever it takes to turn the poor into taxpayers is a wise investment. But such schemes always tend to make the rich — richer. In fact, he says, if the rich don’t get richer, it’s a sure sign the scheme is failing. It’s like turning up an amplifier. If the amp is really good, it accurately reproduces the entire waveform at low or high levels of amplification.
The dumbest approach, he says, is to distort markets and soak the rich. They’ll take their money elsewhere, invest in everyone else’s economy. The rich don’t mind taxation. What they won’t tolerate is unprofitability.Report
Morat,
No, I won’t, because I have broadly accepted economic theory on my side. Paul Krugman sides with me on this as a general rule, so it’s not simply a libertarian position.
Creon,
I can live with most of that–even though I think the estate tax is pure jealousy politics, I don’t find myself particularly exercised by it. Your being cheered by the high marginal tax rates Britan had, though, makes me question your wisdom on this matter. Here’s an excerpt I believe I’ve quoted here before, from The real James Herriot a biography of the british veterinarian and author:
James Herriot stayed and paid the tax until it was lowered by the Thatcher government (ironically, in all other ways he despised her), but he was the only best-selling author in England not to seek tax refuge during those Labor years. Likewise, Bjorn Borg left Sweden to avoid their taxes.
So the moral here is twofold. First, you can call people free riders if you want, but the point of free riding is that it’s entirely rational behavior. So if you go to soak the rich, be aware that you are actually creating an incentive for them to avoid giving you what you’re seeking. Second, you may say you’re only targeting the rich because that’s where the money is, but if you target them at a rate that leads to income flight and reduced collections, you’re actually targeting them out of malice, not out of pragmatism.Report
Blaise, it sounds like your son was talking about a negative income tax, or a variant on it?
I support that approach. The only real problem with it seems to be political. Conservatives can complain we’re subsidizing Twinkie purchases, Liberals can complain we’re not helping people eat more healthily. (And libertarians can conmplsin we’re giving anybody anyone else’s money for anything, but numerically I don’t know that they matter in this debate.) it’s a crazy messed up political world we live in.Report
@jm3z-aitch
Until the pips squeak! Yes! Not sure that was the lesson that was to be taken from that example…
Fortunately, the US taxes citizens globally. I think even if you give up US citizenship, you are still liable for taxes for an additional 10 years.Report
@jm3z-aitch : Yes, I suppose it would fit the bill of a negative income tax. He called it a citizen stipend. Said the farther down the dollars were pushed, the better the total multiplier effect.
Politics be damned. Every time you turn around, some Nagging Nellie is finding fault with someone else’s choices. Lookit that kid in California, buying a lobster with his SNAP card. Heavens! That boy should be eating something healthy — like those extra-good-for-yez hot dogs. You betcha. Tell that to the lobstermen of New England, you preachy lunkheads.
Libertarians should get on board the proposition of sound numerical analysis. Whatever it takes to turn people into responsible citizens, I’m all for it. Human beings thrive when they’re given enough power to make decisions on their own. That’s why I hate command economies, they create passive, sullen, cynical un-citizens whose every move is controlled by ever-increasing and ever more powerful bureaucracies. Poverty of spirit is the most devastating form of poverty.Report
Expatriation isn’t the only form of legal tax avoidance. Start taxing at 97% and you’ll find yourself getting 97% of a much, much lower yield. Why try to make money if you only get to keep 3% of it?
Or, having made the money (because it’s something you just out-and-out enjoy doing or whatever, I can think of lots of things I would do with it before turning almost all of it over the Uncle Sam.Report
Creon,
The question is how best to provide better lives to those living in extreme poverty in third world nations. I agreed with economic liberalism, which has a proven track record of pulling one billion people out of extreme poverty in just the last generation, and which is on pace to increase the standards of living in developing nations by TEN FOLD or more this century. I supplemented economic liberalism with voluntary aid, and in emergencies imposed aid across national borders.
Your response comes strikingly close to recommending we solve the problem of extreme third world poverty by taking from those you envy, dislike or who disagree with you politically. If I read you correctly, you support virtually unlimited marginal taxes of the wealthy. I provided various reasons why this is a terrible idea. You skipped these. Let me spell them out again….
1) Massive taxes discourage productivity and pervert economic efficiency. All you are doing is guaranteeing less wealth will be produced. You are cooking the golden goose.
2) You assume those you empower are benevolent, are able to allocate investments better than private investors and that they will agree to actually use any money in ways which even you agree is wise. I think all three are laughably naive assumptions. (In a battle between billionaires, corporations and starving people in India if you think Obama cares more about the interest of the Indians… )
3) You are ignoring the dependency of coercive redistribution. These people need jobs first, not handouts INSTEAD of jobs.
4) You are ignoring what is not seen. You ignore the “fat cats” investments and bank deposits. You ignore the millions employed making luxury goods. You ignore the efficiency gains of competitive private solutions forced to outperform the herd, vs monopoly bureaucrats trying to grow their personal fiefdom.Report
And pragmatically, keep in mind that by virtue of being rich, the rich have more means to hide their income than we in the middle class do. Soak them, sure, but don’t complain when they act as predicted and find means of tax avoision. You have some room to operate, but not as much as you would like.
Why wouldn’t we complain about that just because it was predicted?Report
if you target them at a rate that leads to income flight and reduced collections, you’re actually targeting them out of malice, not out of pragmatism.
Not necessarily true. You’re only doing that if you do that knowing it will have that effect. if you’re trying rates out to see what the collection effect will be under present circumstances (it’s not like it’s a hard and fast rule that’s independent of various factors that change with time), then that’s what you’re doing.Report
@michael-drew
Why wouldn’t we complain about that just because it was predicted?
Well, you can if you want to be stupid. Because if you can predict the unwanted consequence but commit the causal act anyway, you’ve done a stupid thing. To complain about said stupid thing turning out just as badly as you predicted only compounds the stupidity.
Or put another way, “Those damned people are behaving rationally instead of how I want them to act” isn’t an utterance designed to get one cited in the annals of wisdom.Report
There’s an intervening agent making a decision how to respond the stimulus. A person can take an action that he expects another person to respond to in a particular way and still disapprove of and complain about the response. The examples of the situations where that disapproval remains a valuable social response are frankly too numerous and obvious to need pointing out.
Separately, you, a particular person, can call any particular thing that you want stupid.Report
To put it a different way, say we raise taxes on the rich an amount that in fact raises revenue overall despite a considerable amount of additional tax avoidance. That has worked out rather well – I don’t regret anything; nevertheless I’m not too excited about the tax avoidance. I wanted to raise taxes because I think people with more have a patriotic duty to pay more and said so, and I’m complaining about the unpatriotic action avoiding my successful revenue-raising tax hike. The tax-hike worked out well and I’m annoyed at some people’s response to it, which I knew some of them would take. I wish they’d do their patriotic duty and pay their damn taxes (and a not-inconsiderable number of them were taking considerable pains not to do so before the hike in any case). None of that is remotely stupid.
Maybe you meant it would be stupid to complain about the revenue-decreasing nature of a revenue-decreasing tax hike that I knew would be revenue-decreasing. That’s not what you said, but if that’s what you meant, yeah, that would be stupid.Report
There’s an intervening agent making a decision how to respond the stimulus.
It’s the agent who responds as predicted–I wouldn’t really call them an intervening variable.
The examples of the situations where that disapproval remains a valuable social response are frankly too numerous and obvious to need pointing out.
I disagree. Rather, the cases where people do disapprove, despite disapproval’s lacknof value, are numerous. Unfortunately we have a tendency to make policies that promote these outcomes, and our predictable response to predictable policy failures is to express our dismay and disappointment that people behave exactly as we would expect them to do, instead of saying, “gee, we were dopes to expect/hooe people would respond in unexpected ways; maybe next time we should craft policies that might actually produce the results we want, instead of being carefully crafted to produce the results we don’t want.”Report
Or, to put it most simply: at the end of 2011, we would have predicted a certain amount of tax avoidance in 2012 (despite the absence of a significant tax-hike that I’m aware of – though maybe some Obamacare taxes were going to kick in – so, make it 2006 predicting for 2007, or any year where there was predominantly continuity in tax rates from year to year). What’s not to complain about?Report
Michael,
Actually, when I first broached the subject I was quite clear that I meant a revenue decreasing tax hike.
But even with one that’s high enough to spur some avoision, but low enough to still be revenue enhancing, being upset that some people respond as predicted and find ways to avoid it is not a particularly wise attitude.Report
It’s the agent who responds as predicted–I wouldn’t really call them an intervening variable.
It’s an agent who responds the way it was predicted some agents would. Why can’t we predict that all agents in similar circumstances would respond that way? Agency! I view the agency of tax avoiders as a variable worth reviewing and commenting upon.
The cases where people do disapprove, despite disapproval’s lacknof value, are numerous. Unfortunately we have a tendency to make policies that promote these outcomes, and our predictable response to predictable policy failures is to express our dismay and disappointment that people behave exactly as we would expect them to do, instead of saying, “gee, we were dopes to expect/hooe people would respond in unexpected ways; maybe next time we should craft policies that might actually produce the results we want, instead of being carefully crafted to produce the results we don’t want.
All false choices. That people frequently disapprove when it’s of little or no value says nothing to whether there are numerous times when people disapprove and there’s value in it. That we disapprove of certain predictable responses to policy, whether well-designed or poorly designed policy, doesn’t speak to whether it’s well or poorly designed, or whether we can design or are designing policy well. As I say, a revenue-increasing tax hike will spur avoidance; we can disapprove of the avoidance.
Actually, when I first broached the subject I was quite clear that I meant a revenue decreasing tax hike.
Somewhere way up there you mentioned a revenue-decreasing tax hike; it was not remotely clear that was the condition on this statement: “And pragmatically, keep in mind that by virtue of being rich, the rich have more means to hide their income than we in the middle class do. Soak them, sure, but don’t complain when they act as predicted and find means of tax avoision.” And since this is your attitude:
But even with one that’s high enough to spur some avoision, but low enough to still be revenue enhancing, being upset that some people respond as predicted and find ways to avoid it is not a particularly wise attitude
I’m inclined to think I was not at all wrong to think that you might very well mean the statement, “Soak them, sure, but don’t complain when they act as predicted and find means of tax avoision” to mean what it says without a hard condition of a backfiring tax hike on it.
Though: no one said anything about being upset (until you did). What I said had value was complaint. Public calling-out. I’m not upset about it because, indeed, I expect it (though there are probably things we get used to and come to expect that shouldn’t ever stop upsetting us). I tend to think getting upset doesn’t usually help anyone, though it might have utility for some.
So to be clear: are you issuing the injunction: “Don’t complain about tax avoidance resulting from a tax hike on the wealthy that successfully raises revenue?” It seems like that’s, after all, the most applicable-to-real circumstances question to address in all of this, being that we are in the midst of exactly that policy, if any tax hike on the wealthy is ever likely to fall into that category. If the answer is yes, I’m inclined, frankly, to ignore you.Report
My time in Somalia in the early 90’s showed me poverty. People begging, selling anything & everything for some hard US currency, including themselves. Heartbreaking, and unlike in the US, I truly believed these people had nothing. The fighting between the warlords (for lack of a better term) just took Mogadishu apart.
I recall landing on the beach one day to offload some Marines, & by the time we were done, a small crowd of locals had gathered behind the LCAC to have a look. I had to chase them off before we could take off, because the people were so malnourished that the wash from the main props would send them flying into the ocean.Report
For reasons I cannot entirely explain, transformative change has always come from economic development, and economic development has always come from economic liberalization.
The second proposition is empirically false, but when it has been false, the alternative route has tended to be either extremely violent (early Soviet Union) or extremely exploitative (much of the early industrial revolution, particularly outside of the U.S., which ultimately resulted in massive labor movements and ultimately large-scale socialism and communism).Report
The second proposition is empirically false,
At the risk of being stripped of my official libertarian membership card, I second this statement. An excellent source on this is Dani Rodrik’s One Economics, Many Recipes. Or one can just take a gander at the USSR’s forced mobilization of industrial labor, taking people out of agriculture and putting them into factories. It doesn’t have to be quite that ugly, though.Report
Russia’s a poor example. Jumping straight to the extremes of human psychology does one no favors.Report
At the risk of being stripped of my official libertarian membership card
Eh, just mail the card in if you feel like it, and get a chance. Or not. It’s up to you, really.Report
James, you and I agreed about something in economics. I’ve just printed this screen, and am getting ready to have it framed ;).Report
Eh, just mail the card in
Using UPS or FedEx, of course.Report
Using UPS or FedEx, of course.
Well, yeah. Living in Galt’s Gulch sans Amazon Prime would be a non-starter.Report
Chris,
I’m proud of you. ( ducks)Report
Since the topic is poverty, how those in poverty help themselves also matters. I’m particularly enamored of this example:
http://www.youtube.com/watch?v=UJrSUHK9LuwReport
I’m not offering this as a rationalization so much as an idle thought: How many years does “saving a life” actually get you, in the context of malaria in Africa? Preventing a fatal case of malaria doesn’t guarantee, or even make it likely, that the person saved will live to the age of 70. It just means that he’s not going to die from malaria right now, but he still has to contend with HIV, violence, malnutrition, and all the other perks of living in Africa.Report
In the case of malaria, an infant infected with malaria will sustain brain damage from the high fevers. If the child survives, it will usually be underweight, of lower stature and less-active.Report
This is a reasonable question. After all, for now, everyone dies sooner or later. But I think the estimates are low enough that the benefits clearly outweigh the costs even if not everyone you “save” is going to live a full life till they are 80.Report
Longevity is one problem. Productive lifespan is another matter entirely. It’s a tricksy thing, mapping malaria fever to brain damage in infants because the brain is so plastic at that stage. I’m not a pediatrician, I probably shouldn’t make such a statement. But malaria does damage people, far more than it kills — and it kills plenty of children.
My measure of such efforts and initiatives ought be be how they measurably affect quality of life and productive lifespan.Report
we can save half a hundred children, and pull them into the realm of “not quite dead”.
Or we can make one genius.
Which do you choose?Report
@mad-rocket-scientist
Dude… our most basic fundamental rights are being violated if all GMOs aren’t labeled as such, preferably in big, red lettering, to make sure everyone knows just how scary they. Are you saying poor people lack these same rights? The right to know that the food they’re eating is the same food their ancestors aid thousands of years ago, untainted by the evil claws of science?
(Before reading, please be sure to turn on your sarcasm detector)Report
@kazzy 😛Report
$10 of shots will get you a child who doesn’t go blind before he’s five. That’s vitamin A, quick and easy.Report
Or we can produce staple foods with higher Vitamin A contents and provide the seeds to subsistence farmers, thereby removing the necessity for the shots. And that’s sustainable, and prevents the costs of having to send doctors round to every village every year.
GMOs have a lot to offer in this area.Report
Sorry Katherine, GMOs are evil & must be destroyed, all of them, everywhere, doesn’t matter if they were made by Monsanto or a University lab trying to help people, the Crusaders will not be thwarted!Report
Just so long as their labeled. Starving people have the right to know if that food that is keeping them alive is really Frakenfood.Report
@kazzy Do you really think the people starving or going blind from Vitamin A deficiency really care if their Golden Rice is a frankenfood. If you hand them a bowl a say, “By the way, this was modified in a lab to provide you with essential nutrients your diet regularly lacks.”, do you think they’ll ask any questions beyond, “Is it tasty & safe? Yes? Good, pass the butter please.”
Especially since almost all of our food is genetically modified, the only question is if the modification was done under carefully controlled lab conditions, or selective breeding (which involves a great deal more random chance).Report
@mad-rocket-scientist, the problem is not having a choice. Particularly when someone else owns the genes involved. I have very serious issues with people owning the genetics of the food supply.Report
Or we can produce staple foods with higher Vitamin A contents and provide the seeds to subsistence farmers,
Yes, by all means let’s help ensure subsistence farming remains a primary ocvupation. That’ll really help the poor.Report
@jm3z-aitch,
Yes, by all means let’s help ensure subsistence farming remains a primary ocvupation. That’ll really help the poor.
Farmers work hard, and there’s absolutely nothing wrong with being a small-scale farmer and feeding people in your neighborhood. A little more respect is due; these are often women tending family plots, and what they do is essential to their communities. Despite the existence of frankengrain.Report
Jesus, zic, you think I was disrespecting them? I’m not the one romanticizing the happy life of the subsistence farmer. Why do you think so many people are cramming into the cities in developing countries? Because subsistence farming sucks and they know it. I respect them enough to want to help those who want to get out of it have better opportunities, not develop programs designed to help keep them in an oppourtunityless economic status.Report
I don’t think this is fair.
Katherine argument, appears to me, to be to provide more nutrition dense seed stock to farmers rather than simply give them vitamin shots. That in turn would, in theory free up more labor to do non-subsistence farming stuff, so it’s not as much about ensuring that it’s their primary occupation as it is about giving them a means of supporting themselves.Report
James – If subsistence farmers are able to gain the means to pursue another livelihood, and wish to do so, I’ve no objections. I don’t see why that precludes trying to make the lives of subsistence farmers better – if people are better nourished and better-off, then they’ll have more access to a range of choices about what they want to do with their lives. If better crops and methods can make subsistence farming more profitable, so that farmers can sell some of their products in addition to eating some of them, then that benefits both the farmers and their customers. I don’t see why you would object to that.Report
Zimbabwe. Used to be mostly cash crops under the white regime. Mugabe took over, expropriated much of the land, a few of his “generals” took over some of the best estates. The whole thing degenerated into a huge mess. Zimbabwe used to be relatively self-sufficient. Now it’s a clusterfugg. People are now starving.
Subsistence farming is the worst possible use of farmland. If people could actually “subsist” on subsistence farming these days, there might be some justification for it. It’s just too inefficient to ever work in the modern world. Even in the ancient world, it was quickly abandoned once societies grew sophisticated enough for farmers to specialise.Report
Subsistence farming is the worst possible use of farmland.
This.
@nob-akimoto and Katherine,
Many people make their living picking through garbage dumps. Would you be satisfied with a proposal that just says “give them boots so they can pick trash more safely”?
Subsistence farming is much like garbage scavenging, except because it has a connection “to the land,” we’re less likely to recognize how fucking horrible it is. Subsistence farming is not idyllic family farms. It’s desperately hoping the rains come so your family doesn’t starve; it’s frequently bare subsistence, malnutrition, year upon year. People move to the cities and live in shit and count themselves better off, and send money back home to their rural families.
Give them healthier seed and we’ve relieved them of a single deficiency and can feel good about what we’ve done while they continue to live at the edge of starvation. Yay for us. Our conscience has been assuaged, and that’s the most important thing.
Yes, I’m laying it on thick, and yes, I’m not being remotely fair. But anybody who just wants to make subsistence farming a little better is, IMO, overlooking just how bad it is, and how desperately we need to help societies move past it. It’s not much different from Vikram giving the leper the banana, imo.Report
I’m not the one romanticizing the happy life of the subsistence farmer. Why do you think so many people are cramming into the cities in developing countries
I think that the ability of farmers to farm disrupts regions. The drought in Somalia, for instance. And that helps lead to chaos and actual subsistence farming. Or displacement.
More importantly, seed stock was the topic. That matters. To have farmer’s concerns over seed stock degenerate to subsistence farming is, in fact, disrespect; for it shuts the conversation down about farmers ability to lift away from the edge.
When we leave no room in the conversation for a space between industrial farming and subsistence farming, we take the things that flesh out a meal, that make it nutritious and wholesome off the table. Nobody wants to tell a subsistence farmer she has to stop farming. But if she’s farming, and she would like to do it better, I got no problem with that, and I’d like to invite her to the conversation.
There’s also a disrespect on looking down on someone who works the land as unskilled. Which is actually not true. In my experience, people who don’t have those skills don’t value them, don’t realize how valuable they are. I’ve learned an awful lot from college professors in writing about land use. First and foremost is to listen to the local farmers.Report
When we leave no room in the conversation for a space between industrial farming and subsistence farming, we take the things that flesh out a meal, that make it nutritious and wholesome off the table.
If you’re selling your produce, you’re no longer just a subsistence farmer, you’re really an industrial farmer. It’s just a question of scale. I love going to farmers’ markets. There’s plenty of room for raising your own vegetables and livestock to put in your own larders and freezers. But even the Amish raise cash crops.
True subsistence farming is a nightmare.Report
If you’re selling your produce, you’re no longer just a subsistence farmer,
Bingo.
Nor, despite what zic seems to imply, did anyone in this thread at any time talk up what I suspect she means by industrial farming, or imply it was the only alternative.
@zic,
There’s also a disrespect on looking down on someone who works the land as unskilled.
Whomever this is directed to in this thread, it’s a surprisingly uncharitable reading. I’m sure nobody has said this, And I don’t read where anyone has even implied it.Report
Eh. Uncharitable readings seem to abound, given that you basically accused Katherine and I of wanting to keep subsistence farmers subsistence farmers, or feeling smug and self-satisfied by just giving them fortified staple crops.
You don’t have a lot of ground to stand on about unfair statements here, friend.Report
Well, @zic really does have a point. Case in point, Just Me and I were looking at a grass-fed beef operation in Louisiana. Takes an extra year to raise the cattle but there was already a waiting list for the beef on the hoof. They had this rotating grazing scheme going, put all the cattle in a section of a field, graze it down, move them along to another area. Better grass.
Organic commands a high enough margin, organic eggs especially, to entirely justify that grass-fed beef operation following the cattle around with a chicken wagon. The chickens eat the grubs which grow in the cattle droppings, run up into their wagon to get away from hawks and find roosts for the night — none of this was any sort of Granola Do Gooderism. It was all hard-nosed profit. The margins justified everything.Report
On a broader point, though, your general post is what bugs me about the pro-abusive labor crowd. (And I’m NOT, and I repeat emphatically NOT suggesting you’re part of it)
The fact that the alternative is garbage picking or scraping a living off subsistence agriculture supposedly excusing abusive labor practices that exploit weak rule of law, lower standards in supervisor accountability, maximizing per unit costs over worker safety, etc.
The improvement does exist between that and the worse form before it, but to pat yourself on the back for say sweatshop abuses in Bangladesh because the alternative is worse is scarcely a symbol of moral superiority, and what grates me is the self-satisfied smugness of that position.
My posts on the subject have always been clear that most of this is a cultural, not a government issue. Consumers need to hold the buyers of products (who are in general monopsony or at least oligopsony buyers from contracted factories) to higher standards. Especially since the buyers would still have extensive leverage to get favorable deals from it.Report
There’s only one thing “wrong” with small-scale farming. Unless you can find a niche market you can supply adequately, there’s no way to make it profitable. Here’s the dilemma: on a small scale you can reliably bring your product to market. It’s damned near impossible to expand your market. It’s not just economies of scale, it’s straight supply and demand. If you can’t keep up with demand, people simply can’t buy any more of it and you can’t sign long-term resupply contracts.
It’s a constant problem with startups. The prototype works great, the manufacturing process isn’t quite ready — then you get flooded with orders. Now what? If you can’t ramp up production reliably, you’re literally better off building your market slowly.Report
@nob-akimoto, speaking of picking dumps, I hope you watched the video I posted in this comment.
You know that my dad used to run the dump when I was a kid; he did it for a couple of years. (I have said I grew up poor, right?) He came home once with this record player that on played 78 vinyls and a stack of records about a 1/4″ thick. All of them were WWII propaganda. The only one that played well was this horrific song with a refrain, “You’re a sap Mr. Jap, you don’t know Uncle Sammy.” First record player I was allowed to touch, I must have been about 5, and I played that record to its sorry grave back in the dump from which it came.
If you haven’t yet, please watch that video. It’s a far better musical interlude than my sorry lament, grounded in all the privileges of being poor in the USA.Report
Nob,
The complacency with which subsistence farming is being discussed here is every bit as vulgar as what you’re critiquing. “Let’s make subsistence farming a little bit better” is not fundamentally different from “Picking the dump is a little better than subsistence farming.” It’s why I used the boots analogy–it clearly highlights how ridiculous it would be to only talk about giving garbage dump dwellers boots, and not even demonstrate awareness that nobody should have to be a garbage picker (or a subsistence farmer). I found it a bit shocking.*
As for smug, maybe the “pro-abusive-labor” crowd, as you call them is smugly self-satisfied, but if you think they outsmug the “we care, you don’t crowd,” well, friend, Roman, countryman, I’d like to lend you my ears.
As for uncharitable readings, at least I was upfront about mine. A bit of hyperbole, no?
________________
*Shocking enough that I have to wonder if there’s a misunderstanding of what subsistence farming is; perhaps equating it with simply small-scale farming?Report
@jm3z-aitch
“Shocking enough that I have to wonder if there’s a misunderstanding of what subsistence farming is; perhaps equating it with simply small-scale farming?”
I wonder if this is going both ways, with some people believing they are talking about small scale farming, but used the unfortunate term “subsistence,” and are now being critiqued as if they’re talking about subsistence farming. I guess we have to go with what people actually say and not what they “might have meant,” but that could be a source of the confusion and something that could be resolved with a clarifying question or two.
And for what it’s worth, subsistence farming strikes me as a miserable life. But I imagine that if someone is stuck in that life, then a short-term way to help might be to provide seed, especially if the alternative is not to help at all. There may be even better ways to help, either through direct assistance or creating new opportunities for leaving subsistence farming altogether, as you seem to be suggesting.
(And as for providing a new pair of boots to help with dumpster diving, perhaps a better analogy is to change zoning requirements to make it easier for cheap thrift stores to open up in poorer neighborhoods.)Report
Small scale farming is not subsistence farming. Nor is subsistence farming someone putting in a garden to avoid buying the produce down at Bigco Grocery. Subsistence farming is a truly ugly thing where it’s found. Even the Hausa didn’t practice it: often as not they’d be growing peanuts as a cash crop. Subsistence farming happens beyond the end of the road, where people can’t get a crop to market. It’s usually slash and burn, terribly wasteful and a great destroyer of forests and savannahs — and a major source of air pollution.
There is no defence for subsistence farming and especially not slash and burn.Report
Oh, sure, picking through garbage. That’s what a rich man does, in America, ya? *rich being defined by his community.
Tell me again how fucking rich America is?Report
@pierre-corneille,
I wonder if this is going both ways, with some people believing they are talking about small scale farming, but used the unfortunate term “subsistence,” and are now being critiqued as if they’re talking about subsistence farming.
I am probably guilty of this, but in a backward-sort-of way. Here’s a definition of subsistance farming:
The type of farming BaiseP is referring to may be part of it; I’m certainly not singing it’s praises, and there’s some pressure from the demands of cheap food here that push some of this (particularly in the Americas).
A more accurate reality is one of people shifting back and fourth, having years where they have cash crops because things went well and years where they don’t because of a host of tribulations including drought, flooding, pests, war. There is not bright, clear line between the sorry lot of the subsistence farmer and the happy small cash-crop farmer in much of the world. And no matter where you are in the world, lack of something — water, tools, viable seed stock, medical care for animals, social stability — can push you across that line quickly; a little luck can pull you to the bright side, at least for a few months or two.Report
We seem to be talking around subsistence farming while ignoring the larger truth. Economic liberalism virtually by definition eliminates subsistence farming.
The central insight of economics is that we can produce more better by specializing and then trading our output with other specialists. A subsistence farmer (or a forager) is a throw back to a pre liberal era, and is something most rational adults not in love with impoverishment and misery would leave if they could.
Over the last twenty years or so, Economic liberalism (division of labor and exchange) has empowered a thousand million people to pull themselves out of extreme poverty, making today the best year ever for average human prosperity and well being.Report
I’ve seen an awful lot of farming in Africa, Central America, India, Af/Pak, other more industrialised places, too. I’ve never seen people retreat from cash crops back to subsistence farms. Old Hausa myth.
How the Turtle Got his Cracked Shell and Why the Pig Roots in the Ground
In the days of old when men and animals could yet speak to each other, the Turtle borrowed millet seed from the wealthy Pig. The Turtle’s crop failed and the Pig came looking for repayment.
Now you should know the Turtle had a human wife, who would grind millet for tuwo between two stones. The bottom stone is long and flat. The top stone is hemispherical. Hausa wives choose that top stone carefully for it will serve them all their lives, grinding millet.
The human wife, seeing the pig coming from afar, took her grindstone off its base stone and put her husband on top, in its place. The Pig arrived and asked to speak to the Turtle. His wife said the Turtle had gone on a trip but the Pig did not believe it.
“If you do not tell me where your husband is hiding, I will break your grindstone.” Despite the wife’s protest, the Pig picked up the “grindstone” and threw it into a distant, rocky field. The turtle sailed end over end, crashing to the ground, fracturing his carapace. The turtle survived and slowly crawled away, into the weeds.
“Now you’ve well and done it! If you do not return my grindstone, you will never be repaid” shouted the wife. And from that day to this, the turtle has a cracked shell and the pig is forever rooting in the ground, trying to find that grindstone.Report
@zic (Boy did this thread get long…)
I also have issue with patenting genes, such things should fall under Trade Secret rules, not patents. I also have issue with how a lot of the big GMO seed producers behave regarding their products.
Neither has much to do with the original point Kazzy baited me to, which is labeling GMOs as if they are somehow worse than other food items, even though AFAIK, there is no research to support this idea. It also has little to do with my reply to Katherine, regarding the dogmatic resistance to GMO crops, even when those crops are being created to help. Such as the incident in the Phillipines where activists destroyed a large crop of Golden Rice.Report
Brandon,
Low life expectancy is predominantly a function of infant and child mortality. Get the kids to adulthood, and they’ve got a pretty good shot at a reasonable life-span.Report
Ah, you’re right. I was under the impression that Africa was pretty tough on adults, too, but looking at the life expectancy curves I see that it’s not that severe.Report
Can we list a fourth reaction to a wealthy person confronting the reality of poverty a form of paralysis? Every pathway in response to confronting the reality of poverty that is open to me is one in which I am guilty of some sort of moral failure. So no matter what I choose, I am morally condemned, and I am not good at judging between varying degrees of moral culpability at this point. Therefore, I do not change my actions at all. Or would this be a variation of the second reaction, rationalization, relying on the maxim, “damned if I do, damned if I don’t”?
In another sense, I must somehow move on in and act within the world. Does not the shunting away the knowledge of poverty, or rationalizing that I am not at fault for its existence, or rationalizing that I am powerless to change it, not merely give myself the moral latitude to enjoy my luxuries but also to the ability act at all?Report
Yes, we can add another rationalization. I wasn’t intending my list to be a complete one. It’s just my third one.
The description you give sounds quite a bit like choice overload actually! You don’t know the perfect moral solution, so you go with the War-Games solution of the only way to win being not to play.
Does not the shunting away the knowledge of poverty, or rationalizing that I am not at fault for its existence, or rationalizing that I am powerless to change it, not merely give myself the moral latitude to enjoy my luxuries but also to the ability act at all?
I’m not sure I totally follow that, but I think the answer is “yes”. The bug is the feature and vice versa.Report
I think its also very important to point out that many of the developing countries chose socialism, protectionism, and planning over capitalism, free trade, and economic liberalism because they associated the latter with the colonial governments that dominated them in late 19th and early 20th centuries. To them capitalism and tyranny were practically synonyms.
This might not have been the best policy decision but it was an inevitable one. The United States was in position to provide an alternative example, capitalism as a beneficial source, because we were viewed in league with the imperialist powers. The tendency to overthrow governments or assassinate leaders we felt were too socialist or communist during the Cold War did not help.Report
many of the developing countries chose socialism, protectionism, and planning over capitalism, free trade, and economic liberalism because they associated the latter with the colonial governments
That’s an interesting idea that I’ve never actually heard before. There is a certain tragic logic to it.Report
Andrew Sullivan quoted your “corpse in the closet” idea, and that inspired me to come here. I think the suggestion that I would spend a lot of time and effort trying to spend my assets to raise $2,500 to save the life of the person whose corpse would otherwise be delivered to me is false. Whilst the first few corpses that I received would presumably disturb my emotional equilibrium, I think I’d probably get used to the corpse delivery service after a while. I’d be far more likely to keep my suit on a hanger and not open my wardrobe, or just get into the habit of standing to one side when I opened the wardrobe doors to dodge the gently toppling cadaver. After all, it’ll vanish at the end of the day. My point is that your deity doesn’t seem to be applying any sanction, he’s just appealing to my supposed natural sense of humanity. The problem with this is that history shows us, over and over again, that people can easily become desensitized to the suffering of others. To be honest, even if I had a spare $2,500 (which I certainly don’t) I’d rather spend it on myself, or on someone close to me. I might try to save the life of someone in my family, but that’s as far as I am likely to go.Report
The lack of any sanction was necessary, because I didn’t want anything to change other than your having verifiable knowledge of the consequences of your actions.
You might be right about what would end up happening. After all, I think everyone would sooner or later get at least one corpse and perhaps learn that it isn’t as bad as they might have imagined.
That is a pretty sad thought though.Report
I’m not sure that “sad” is the right word. If I’m right (and I’m not sure that I am), it’s simply an observation about human behaviour – my own and other people’s. Empirical observation is just facts, and these facts only become emotionally charged when people start imposing some sort of moral or ethical or emotional framework on them. You think it’s sad because you think people “should” engage in some particular behaviour pattern. This strikes me as being simply a personal preference. The fact that the world doesn’t behave as you would prefer it may be regrettable for you, but that’s just the way the world is.Report
Also coming in through Andrew Sullivan’s link (hope we’re not crashing the servers…)
“Let’s make it a bit more explicit. Some sort of deity who is able to demonstrate his powers to your satisfaction tells you that from now on, every time you fail to find an opportunity to save to spend $2,500 on mosquito nets, you will find the corpse in your bedroom closet of the person you failed to save. The body will vanish at the end of the day without inconvenience or legal issues. You would nevertheless endeavor to avoid finding corpses in your closet.”
We have a test case for this: how much do affected governments actually pay for mosquito netting? No deity required (unless we are the “deity”), and the corpses don’t even have the courtesy of disappearing at the end of the day.Report
crashing the servers
I have no idea who does the hosting here, but they seem to do a good job on that sort of thing.
how much do affected governments actually pay for mosquito netting
The GiveWell link’s research seems to indicate that in general nets will probably not be supplied absent donations. In fact, that is among GiveWell’s explicit criteria. They want charities to do things that would not otherwise be done, not to substitute for some other mechanism for accomplishing the same thing.
But since when do we stoop to the standards of governments?Report
@vikram-bath
I realize you put economic liberalization under “rationalizations” and concluded with a parting shot about how convenient it is for you to believe it. But even after reading some of your clarifications in the comments above, I still think you’re giving economic liberalization too much credit.
I’m increasingly on board with the idea that economic liberalization is probably the best single way to combat poverty systematically. I don’t, however, think it can do it alone. I can imagine a scenario in which the unfortunate people you saw as a child would be helped by an increasingly liberalized economy, but they still might need some redistributionist help, too, even after economic liberalism has taken off. And personally, I’d like to see a mix of economic liberalism with a social guarantee of basic necessities, with the definition of what counts as “basic” rising with the new wealth and possibilities that economic liberalism can bring.
Now here I’m engaging in rationalizations. The first, probably most obvious, is that my hybrid-preferences will probably be most applicable at the national level and not at the world level. So the very very impoverished will still not be helped.
The second, related to the first, is that I haven’t really addressed the problem you bring up in the OP. The truth is, I tend not to think about the very very poor of the world and it helps that I don’t live amongst them. Even the poor here in Chicago, it’s either an out of sight, out of mind thing, or I adopt the sort of rationalization that your mother apparently did: some de facto belief that “they” are lying or at least not being fully truthful when they ask me for money.Report
Economic liberalization and redistribution have a complicated relationship. It is not my particular research area of expertise, but my mental model goes that economic liberalization in the presence of certain other factors (e.g. low corruption, a stable government and legal system) will later help pay for redistribution.
India in particular has long tried to redistribute before development, and it hasn’t worked, but I admit that might be more due to corruption than to a lack of development.
It is an admittedly simplistic thought, but I think the focus should be on building wealth first where there is not enough. You can always go in later and redistribute it later.Report
I pretty much agree, Vikram.Report
Open question…
In my discussion with Creon, he expresses something which I completely fail to understand, but which I hear repeatedly from the far left.
“If the haves are to go on living in this political community, they’ll have to abide by a set of decisions we make together. I don’t necessarily have to convince them to do right by the have-nots.”
My take on the issue, is that Creon and others believe that if a democratic majority decides to confiscate the assets of a wealthy person, that this is proper. I do not get the argument.
This seems to me to confuse two levels of justification… Procedural and consequential.
If half the population votes Hitler into office and the Jews into concentration camps, then we may very well have according-to-Hoyle procedural justification. But consequential justification? A bad decision arrived at by the agreed upon process is still a bad decision.
If the majority votes for apartheid, then should blacks “have to abide” by the “decisions we make together?”
NO. Procedural justification does not pardon immoral acts. We can still debate whether it is right or wrong, wise or foolish to confiscate wealth from others. But hiding behind procedural justification is bogus. It is not right to do a wrong thing the right way.Report
I wonder, can you point to some other examples of precisely this sentiment expressed by members of the “far left?”Report
LWA has used it repeatedly. More importantly, as our resident Socialist, do you agree that procedural justification is inadequate?Report
That depends. It’s vague. I believe it’s meant as a sort of reaction to the notion — a true one, it should be said — that money has so much influence on politics that the few, the wealthy, are making the rules rather than the many, the non-wealthy. I could be wrong though, as CC’s is the only explicit instance that I’ve seen. Unless you mean to include people saying things such as that they, the majority, will be heard and they will change things so that the wealthy do not wield an undue amount of influence on policy and politics, in which case I don’t think it means what you’re interpreting it to mean here (though CC may actually mean what you are interpreting him specifically to mean).
I do agree that any strictly procedural justification is inadequate, ethically. I also agree that straight, unencumbered majority rule will inevitably turn bad. I suspect, though I cannot speak for him, that CC would agree with us on this, and that he actually means something different.Report
Chris is a socialist?Report
Chris is generally non-committal when it comes to the specifics, at least ’round these parts, but Chris is almost certainly not the sort of socialist Roger thinks of when he thinks of Socialists with capital-S’s and such. Chris is also not quite sure why he’s referring to himself in the third person.Report
I am under the impression you told us you were a socialist. If I am mistaken, please feel free to correct me. You are also free to change your label. It is all good, bro.Report
Roger, I am a socialist, but again, probably not in the way you represent them. That is, I am not a state socialist, at least not ideally.Report
No sense in assuming I misunderstand you. Please feel free to clarify what type of socialist you are. Then we will have no confusion, right?
As a start, what are the distinctions between a state socialist and your ideal?Report
Roger, the difference between the two would be the state.Report
Still cryptic… I do not know what non state socialism is. Is it an ethos? An ideal? Is there a good link on it?Report
Roger, this will probably get you started.
As you may be aware, there was a fairly drawn out, at times violent battle for dominance in the 19th and early 20th century between state and non-state socialists, ultimately won by the state versions in the form of the Bolsheviks (who benefitted greatly from the intervention of RIAU against the Whites). State socialism is only one of many types of socialism, and is historically one of the younger types.Report
This seems to me to confuse two levels of justification… Procedural and consequential.
I don’t think it confuses them at all. In one sense of “proper”, devolving from the type of government we in fact hve here in the US, any bill that’s passed consistently with procedural requirements and is signed into law by the President is a “proper” law or policy. In another sense, if a liberal were to advocate for the confiscation of wealth, they would argue – at least according to the hypothetical – that such a confiscation was proper, while you would argue that such a policy is improper on consequential or principled grounds.
That dispute is called a “disagreement”.
So I think you understand it perfectly.Report
I know it is a procedurally proper law. So is confiscating the assets of Jews and sending them to labor camps according to the same procedures. Procedural justification is necessary, but not sufficient. Right?Report
I think you’re arguing a straw here. Or maybe I don’t understand your worry/criticism.
It’s irrational to advocate for a law or policy simply because it’s procedurally permissible. Any advocacy, it seems to me, is based on a substantive end-goal, not mere procedural consistency.Report
Pseudo-philosophical gibberish. Justification arises from many quarters. You can justify something on the basis of their relationship to other beliefs. You can justify something on the basis of reason chains. Or fact-based reasoning, a troublesome old thing, what with facts never taking sides.
Ultimately, justification is what’s provided when anyone questions a decision made on the basis of power. I can do as I please and you can’t stop me. On the cannons of Louis XIV were cast these words “Ultimo ratio regum”, the last argument of kings.
What you think is proper is of no consequence beyond your right to cast a ballot. You get a vote, I get a vote. Consequentialism says elections have consequences. Apartheid was never a majority opinion, the whites of South Africa were a distinct minority. They had the power. Ultimo ratio regum. Your feeble protests about immorality may be taken up atop your own little soapbox and there they’ll stay. The Haves in a given society have the power, right up to the point where people vote in a government. Wrong is what you say is wrong. In a working society, the powerless are protected from harm by rules you might not like. Get over it.Report
Roger,
Let me get this straight, in your view higher marginal tax rates are immoral? Not only immoral, but immoral on the level of the Holocaust and apartheid South Africa?
Second, I specifically linked to the wikipedia article “liberal democracy” (at 1:54pm, though in my infinite wisdom I apparently failed to include http:// so the link doesn’t work) because I didn’t want to get sidetracked into a long exposition on the safeguards in place to protect rights (and minorities) in the political community. So no, there is no procedure by which genocide is appropriate; similarly, there is no procedure by which state sanctioned deprivation on the basis of ethnicity is appropriate. Those acts transgressing against the human dignity of others are not comparable, in my mind, to raising tax rates.
Taxation is not a crime against humanity. Frankly, it says quite a bit about your perspective on labor, wealth, and desert that you could put my remarks on taxation in the same comment box as some of the most obscene crimes ever committed by humanity.Report
More about his lack of perspective. A common enough problem for the one-eyed man. But he is king of the land of the blind.Report
I was not equating anything with confiscating wealth. I floated a hyperbolic example to flesh out the distinction between procedural and consequential justification.
My reading now is that you do not approve of procedural justification alone. Thanks for clarifying. Chris and I seem to agree with you.
Stillwater and Blaise seem to disagree with us. They will chime in if they disagree (one will do so in a demeaning, rude, school yard bully tone).Report
Self correction, Stillwater above agrees with us too. My bad.Report
Stillwater and … seem to disagree with us.
Wrong.Report
Creon,
As you have already argued, sometimes differences in degree become differences in kind. The “fat cat” argument above clearly reveals that you dislike, are envious, or fearful of the wealthy and that you do not approve of how some spend their money and that you believe those in power could spend it wiser than them and SHOULD. We agree that using democratic process alone is inadequate justification for confiscating their wealth.
I for the record can clearly see how we could all (even the wealthiest) agree to progressive taxation behind a Rawlsian veil. So we are not discussing voluntarily agreed to progressive taxation. You appear to be advocating up to 99% marginal taxation and seem to argue that if you could get a democratic majority to prevent wealthy people from owning mansions and jets that you would do so. This is a difference in kind, not degree.
So. What is your moral and or consequential argument?Report
Roger,
The first use of the term “fat cat” is by you at 3:58pm, not by me. Feel free to do a Ctrl+F search of the page for all the uses of “fat cat” in this discussion and check. If the term “fat cat” is so loaded, so freighted with dislike, envy, and fear, then maybe you shouldn’t have used it. For my part, I don’t think fat cat is such an offensive term, but I can cease using it if you wish. If that is the case and I ought refrain from using the term “fat cat”, you might want to apologize for introducing such (supposedly) offensive language into the dialogue to begin with.
It is as though a red mist descended once you used the term “fat cat” and you’ve not read my (admittedly lengthy) replies. I made several major lines of argument, some fairly anodyne, some slightly more controversial. None deserve the ridiculously over the top labels you’re attempting to affix.
1. We need to interrogate consumer capitalism (aka current economic/social arrangements) on social justice grounds.
This was the crux of my first comment on the thread. That this whole discussion ensued is telling. The vociferous defense of the wealthy, the personal attacks (repeated accusations that I’m “envious”), and the near cloying praise for the wealthy. How dare I (or others) criticize the sainted wealth creators.
2. Every one of the 300 million+ individuals in the US is not a veto point. I do not have to personally convince the Waltons, Kochs, and Thiels of the world to raise their taxes. By way of liberal democratic processes, we as a community can legitimately raise their taxes.
This is not a controversial point of sociology or political science. Large groups with many veto points means no decision is reached. The US political system, present circumstances notwithstanding, comes to decisions on resource allocation (taxing and spending) with or without the assent of every individual citizen.
3. The wealthy have claims to their wealth, sure. There are also countervailing claims on these grounds: social justice, social and economic rights, an obligation to ensure everyone leads a life with dignity.
More controversial than my initial, interrogate the current arrangements, as here I’m supplying counterclaims on individual wealth that I believe are worthy of consideration.
4. The marginal dollar is less valuable to millionaires and billionaires than it is to the working poor, poor, and extremely poor.
Again, not controversial. This is just a fact.
5. Because a generic fat cat has so much and so many have so little, we are justified in taking some from billionaire A and giving some to $2 dollar a day Indian citizen B (for my purposes that taking occurs in the context of a liberal democracy and that giving can be in the form of services like schooling, health care, etc.). [By the way, this comment of mine at 8:26pm was my first use of the term “fat cat” when not quoting you Roger]
The most controversial statement I’ve made in the thread perhaps. But not the bizarro-land thing you think I’m claiming: “You[, Creon Critic,] appear to be advocating up to 99% marginal taxation and seem to argue that if you could get a democratic majority to prevent wealthy people from owning mansions and jets that you would do so.”
I said in passing I was heartened that during a world war the UK’s top rate of tax was 99.25%. I offered some criticism of a billionaire who built a $1 billion home in India – I referred (at 1:40pm) to “the sometimes highly dubious consumption choices of the wealthy”. I further said:
Again, still not the dictatorship of the proletariat levels you appear to be taking this conversation to. I feel like I’ve had a perfectly reasonable discussion with J@m3z Aitch; by no means do we agree on everything, but we explored some of the boundaries of our positions in a perfectly sensible manner. I hope, Roger, we can do the same and that you can reply to things I actually said as opposed to what a red mist says I said.
For instance you write,
Here’s what I wrote (at 4:40pm ):
Report
My first use of the phrase was from a quote of yours at 1:40 above, the one where you said to die wealthy should be considered a disgrace. But I agree that it is silly to tussle over who said what when.
Would I be presumptuous then to assume that you agree that the wealthy deserve the same respect, treatment and rights of everyone else?
I will answer the rest of your comment below.Report
“The wealthy have claims to their wealth, sure. There are also countervailing claims on these grounds: social justice, social and economic rights, an obligation to ensure everyone leads a life with dignity.”
I take it this is the heart then of your argument, as point one seems to be a plea for keeping an open mind and point two is a restatement that we need to arrive at these decisions in a procedurally justified manner, something we have already agreed is necessary but totally insufficient.
The problem is that you just threw out a bunch of ill-defined terms. Hyperbole alert: If the majority believes justice is apartheid and that dignity requires the lesser humans to become chattel, then is it morally acceptable to do so? Of course not. So it is unacceptable to just proclaim that taking from the wealthy leads to more justice and dignity. You must first argue why. I am sure you have an argument. You just have not presented it. At all.
My counter-argument will be consequentialist in nature. I will argue that confiscatory levels of taxation will reduce positive sum voluntary transactions and thus lower total utility. I will argue that the nature of any economic transaction is win win and that by definition any money freely earned by a wealthy person implies a corresponding utility increase for each person on the other end of each economic transaction. Thus the wealthy do millions of time more good for their fellow man, by definition, than the poor (this assumes they did so under the rules and conditions of free enterprise). This also implies that you are taking capital from those generating the most utility for fellow humans and diverting it to politicians. More on that below.
I will argue that confiscatory taxation reduces the incentive to earn money in that market. It reduces the incentive to invest, it reduces the capital to invest. Reduced capital lowers productivity, it lowers the incentive to risk money, to test economic hypotheses, to create new products, build factories, expand markets. This argument is absolutely fatal to your cause. It effectively eliminates the productivity enhancements of the last two hundred years. You are arguing for the confiscatory policies of emperors and kings who always stopped economic progress dead in its tracks. Confiscation of wealth is effectively confiscation of capital and the elimination of prosperity as we know it. Your search for justice and dignity would lead to the impoverishment and death of billions, along with the golden goose you seek to sacrifice.
I will argue that politicians are the worst possible people to entrust with resources taken from those with a proven ability to create human prosperity. Politicians and those in government agencies lack the benevolence of helping the poor rise out of dependence. It is contrary to their interests as they thrive not on solving poverty, but continuing it so they can continue to control the resources (by the way, cultural evolution implies this can occur without any evil intent) Furthermore they are incentivized to distribute not to those most in need, but those most able to help them politically. We want aid to kids, we get ethanol subsidies. The politicians and their administrators lack the knowledge of what is needed, where and often have perverse incentives which are contrary to human flourishing.
I will argue that redistribution creates dependence on those receiving the aid. That it reduces their incentives to work, to study, to invest in themselves, to save for the future and most importantly to focus ones economic efforts at adding the most positive sum value to fellow humans. Thus it effectively grows an economically inefficient and dependent class lacking dignity and self sufficiency.
I will argue that the marginal utility argument is questionable for several reasons. First it ignores the unseen marginal utility created by the other win in every win win economic transaction. You see the dollar taken from the billionaire, you miss the job, the factory, the new car and the other utilities created by that money in the billionaire’s portfolio. Second it makes the naive assumption that a dollar earned by someone focusing on wealth creation is the same as a dollar handed out to someone less focused on wealth as a priority. It also neglects the well known psychological in-equivalency of gains from losses. Studies show a dollar lost is valued twice as much as a dollar gained.
In summary, I think your scheme to confiscate wealth from the rich would result in widespread catastrophe of a kind never before experienced by the human race.
Please do not misread me. This is not an argument against a two percent higher marginal tax rate. Nor is it an argument against social safety nets or shared responsibilities to help the needy. My argument is simply that confiscatory taxation from the wealthy would be economic suicide. It would hurt everyone, not just the rich and it would hurt the poor the most. Indeed it would probably lead to most of our deaths.Report
Roger,
First, hands up, you’re absolutely right and I was wrong (I’m sure you’d like me to stop there, alas more to follow) – I used fat-cat and I searched “fat cat” and failed to catch “fat-cat”.
Second, I’ve been looking in vain for a long, long, ago exchange we had on economic and social rights, freedom from want and all that. I think it would go a long way towards answering your question on “ill-defined terms”. Having failed to find the exchange, and spent far too long looking through League archives for it, I’ll just offer a précis: generations of rights are interconnected, second generation rights matter at least as much as first generation rights – relatedly, the rights of the wealthy to their wealth confront an equally compelling set of social/community-based claims about the well-being of everyone else. That’s the “why” of my argument.
Part of our substantial disagreement is the level of injustice, if any, committed when taxing the wealthy. Maybe this would help, could you define confiscatory tax rates? Do you think current US tax rates are “confiscatory”?
Looking at the past hundred years of taxation in US history (Wiki), top income tax rates have varied from 7% to 94%. For some extended periods of time with substantial US growth the top income tax rate has been 89-91%.You offer quite a few taxation vitiating investment arguments that don’t seem to have manifested themselves during these decades of US history.
Beatification for the wealthy! Really, “millions of time more good for their fellow man”!?! Let’s bring the wealthy down from the music of the spheres. There was some individual agency involved in the wealthy becoming wealthy. And there was also a good amount of plain old luck. Lucky who their parents where, lucky the society they were born into, lucky they are literate and numerate, lucky the physical-social-political infrastructure supports their endeavors, lucky the society values their particular mix of skills… Good fortune for the wealthy (excuse the pun) goes on and on. Suffice it to say, being sympathetic to luck egalitarianism, I’m much more skeptical of the wealthy’s claims to desert than you are.
any money freely earned by a wealthy person implies a corresponding utility increase for each person on the other end of each economic transaction
Here’s where we disagree in this case. I’d say I’m a soft-communitarian. The transaction is embedded in a broader context and that context needs examination before we reach conclusions about the welfare of the person at the other end of the transaction. You, rightly, add some of that context back in when you note “this assumes [the wealthy] did so under the rules and conditions of free enterprise”. For me there’s even more context still about the relative positions of the individuals involved in the transaction. Ground covered in prior sweatshop discussions, desperate exchange, power differentials, and so forth.
You tip over into some pretty interesting claims; the “elimination of prosperity as we know it” and the “death of billions”! I’m transformed into a Maoist counseling a Great Leap Forward in this reading. Except, no, I haven’t been arguing for the dictatorship of the proletariat’s supremacy. Here’s a Krugman’s blog post I’ll reproduce in its entirety:
The fact of existing social democratic states also undermines your arguments about politicians and dependency. Apparently politicians, government, can also create structures whereby more people have access to more opportunities. In a nutshell, child poverty rates in the US are, and should be, a national embarrassment. To simplify what ought to be longer and more nuanced reply: US peers perform better on that (child poverty) score, among others, and part of the reason many of they do it is social welfare spending and yes, redistribution. They manage to do so without their economies collapsing around them and without billions of deaths. The US should follow their lead.Report
@creon-critic
I owe you an apology. You have been the one taking the high road and you deserve better. I am surprised you didn’t just bail. I apologize.
.”… generations of rights are interconnected, second generation rights matter at least as much as first generation rights – relatedly, the rights of the wealthy to their wealth confront an equally compelling set of social/community-based claims about the well-being of everyone else. That’s the “why” of my argument.”
I do not recall, but my memory is in the pre Alzheimer level. Sounds fascinating. Let’s circle around to it again in the future.
My take on justice is more of a modified Rawlsian. People should be allowed to agree to the rules of the game, including pros and cons, benefits and duties wherever possible.
I would agree up front to the idea of progressive taxation, especially of the variety of let us say a thirty percent flat tax with a fifty thousand dollar exemption. Thus the rules are fair and apply equally to everyone with no opportunity for vindictive exploitation. Those most able pay more, those less able pay nothing. I do not think our current rates are anywhere near confiscatory. Though I do think that the government takes in and wastes way too much already.
In terms of income taxes, it is important to look at effective rates, not gross rates before exemptions and deductions. Today’s rates are more progressive than the past and more progressive than many other developed nations. The top earners pay a higher share and the low earners (such as me) pay nothing. The relative progressiveness is fine by me, however, economic growth would be higher if we collected even less in taxes.
Studies consistently reveal a strongly negative correlation between tax rates and economic growth:
http://taxfoundation.org/article/what-evidence-taxes-and-growth
And here are Average federal taxes by quintile since ’79. The trend is not free riding by the wealthy, it is lower tax rates for all with increasing progressivity. Both are trends which I endorse.
http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=456
Do allow me to clarify the value of the wealthy. I am in no way saying they are not lucky. It is entirely possible that they are rich because they were in the right place at the right time. I am also not saying that they deserve it on some moral plane.
My argument is simply that in economics, as per Adam Smith, every mutually voluntary interaction implies two consenting adults expecting to gain. We cannot compare and measure utilities or surplus, however in a reasonably competitive and free market, we can assume broadly that both gained. An expected “utile” was created on both sides of every transaction. Furthermore, higher returns are expected where scarcity (higher utility) exists. From this it follows that in a relatively free market those that create billions of “utiles” for themselves likely also created billions of “utiles” for others. The wealthy could be lucky jerks. However, their market rewards reflect the value they added.
As to “just deserts” my only comment is that according to the rules of the game these are the expected rewards. Furthermore, any state not following these rules is going to be relatively poor, especially over time, all else equal. Any difference in economic growth rates leads over a number of generations to huge multiples in terms of average prosperity. Growth rates trump all long term.
I do not think it is debatable though that if we ELIMINATED the worldwide ability to make large profit that we would in effect dismantle our economies. Nobody invests or risks millions to earn thirty thousand a year after taxes. In the positive sum view of economics as above, anything which discourages investment, capital improvement, business expansion on one side of the ledger also kills it on the other side. We would be crippling ourselves to get the rich. The only alternative to the invisible hand is top down planning. Any arial night picture of the Korean Peninsula shows how that works.
In brief, I totally disagree with the ability of a monopoly coercively requiring customers to pay for service — unless absolutely necessary. This tends to lead to large, unresponsive bureaucracies which resist change and milk their customer base. The growth rates of economies link above reveals that resources are being diverted inefficiently.
We provide almost one trillion in need based aid in America (an amount which I do not object to). Poverty statistics are before income transfers, so are basically totally useless to judge actual living standards, which have increased substantially even in the last generation (links available on request or google consumption standards) If we still have a problem with child poverty after providing a trillion in aid, then you are in effect proving my case. The government is not even able to redistribute money efficiently and effectively to those really in need. Our schools are twice as inefficient as other advanced economies, and especially unfair to the poor and disadvantaged. Again not a success story for big government.
I will add on a post script on Sweden in a few minutes….Report
Creon,
Last I checked, Sweden’s economic freedom index was comparable to ours. Better in some ways, worse in others. Are you implying that they have confiscatory taxes? If so, they are much better in other ways. Do note that some states are economic followers and others are economic leaders. Someone has to lead for the others to draft. Market innovation has been coming out of a narrow set of leaders. I can expand on this if you would like.
On Sweden, if this link works, it presents a different view of the situation…
http://www.iea.org.uk/publications/research/the-surprising-ingredients-of-swedish-success-–-free-markets-and-social-cohesi
“Executive Summary:
Sweden did not become wealthy through social democracy, big government and a large welfare state. It developed economically by adopting free-market policies in the late 19th century and early 20th century. It also benefited from positive cultural norms, including a strong work ethic and high levels of trust.
As late as 1950, Swedish tax revenues were still only around 21 per cent of GDP. The policy shift towards a big state and higher taxes occurred mainly during the next thirty years, as taxes increased by almost one per cent of GDP annually.
The rapid growth of the state in the late 1960s and 1970s led to a large decline in Sweden’s relative economic performance. In 1975, Sweden was the 4th richest industrialised country in terms of GDP per head. By 1993, it had fallen to 14th.
Big government had a devastating impact on entrepreneurship. After 1970, the establishment of new firms dropped significantly. Among the 100 firms with the highest revenues in Sweden in 2004, only two were entrepreneurial Swedish firms founded after 1970, compared with 21 founded before 1913.
High levels of equality and favourable social outcomes were evident before the creation of an extensive welfare state. Moreover, generous welfare policies have created numerous social problems, including high levels of dependency among certain groups.
Descendants of Swedes who migrated to the USA in the 19th century are characterised by favourable social outcomes, such as a low poverty rate and high employment, despite the less extensive welfare state in the USA. The average income of Americans with Swedish ancestry is over 50 per cent higher than Swedes in their native country.
Third World immigrants have been particularly badly affected by a combination of high welfare benefits and restrictive labour market regulations. In 2004, when the Swedish economy was performing strongly, the employment rate among immigrants from non- Western nations in Sweden was only 48 per cent.
Since the economic crisis of the early 1990s, Swedish governments have rolled back the state and introduced market reforms in sectors such as education, health and pensions. Economic freedom has increased in Sweden while it has declined in the UK and USA. Sweden’s relative economic performance has improved accordingly.”Report
Amazed there is so much traffic on such a topic There is no way i could read all of the responses on this single article, but hope my article addresses some issues I found with the blog.
http://piercegordon1.wordpress.com/2013/10/20/questions-with-obvious-answers-the-danger-of-reframing-and-oversimplifying-poverty/Report