I’m from the US and of the libertarian persuasion, though not so propertarian as most US libertarians.
Liberals here seem to want to help the poor and less financially fortunate.
But it seems to me that the means selected to help them always tends to be a paternalistic welfare state—more power and control for the government. I think that’s just bad market economics and political economics—the regulatory state tends to hamper production and destroy wealth, and the rich are much better able to navigate and manipulate the regulatory state. So it’s just a bad prescription for the stated goal.
For the liberals, whatever happened to good old expropriation and redistribution of wealth as the leftist solution? Why not that instead of the paternalistic regulatory state?
The problem with being poor is you don’t have money. Take money from A, and give it to B. I think there are decent arguments for this going back to Thomas Paine and Agrarian Justice, things that even a Bill Oreilly could get on board with (It was amusing and surprising to see Oreilly defending Alaska’s redistribution of oil fees directly to Alaskan citizens—“It’s our oil!” Ha! What a commie!).
I was watching William Buckley debate Milton Friedman on welfare policy, with Friedman in favor of negative income taxes (the problem with poverty is you don’t have money), and Buckley making one paternalistic argument after another why you couldn’t just give the poor money, arguing for a paternalistic regulatory state for those on state assistance.
It occurred to me that the difference between Buckley and Liberals was how many people they thought warranted this kind of paternalistic aid and interference, while Friedman much preferred to let people run their own lives.
For the libertarians, wouldn’t you, like Friedman, prefer a basic income guarantee to the paternalistic regulatory state?
I think that one of the main reasons why the US has the complicated welfare state that it does, instead of simple cash transfers, is that unconditional cash transfers to the poor are unpopular among the general public. They make a lot of people feel like they are being taken advantage of. Instead of working like we are, these people are just mooching off of us. The government is taking our hard-earned money, which we deserve, and giving it to people who don’t deserve it. That feeling was one of the main motivations behind welfare reform in the 1990s (recall “welfare queens”). When the word “redistribution” does come up in American politics, it’s almost always as an accusation by the right against the left (like in response to Barack Obama’s “spread the wealth around” comments during the 2008 election).
If you look at the various safety net programs that the US has (alternatesources), they’re designed in a way that avoids that impression that they are just giving your money to the undeserving poor. The recipient seems deserving, because the program does some combination of the following:
help people who are especially needy, sympathetic, or helpless on their own, like children or the disabled (e.g., SSI, school lunches, CHIP). They’re the ones who really need our aid. Programs for the elderly (like Social Security) might count here too.
meet people’s basic human needs, rather than giving them money which they can spend on anything that they want (e.g., SNAP, housing assistance, Medicaid). Everyone ought to be fed; giving people food doesn’t feel like you’re being taken advantage of in the same way as giving money (and similarly with healthcare, housing, etc.). In some cases, like SNAP (food stamps), this can be pretty close to a pure cash benefit since money is fungible and pretty much everybody buys food. In other cases it involves a lot more meddling.
reward good behavior, giving money to poor people who are doing something to deserve it—especially those that are working or seeking work (e.g., EITC, TANF, job training). This category has grown the most over the past couple decades, with welfare reform (making welfare dependent on employment-seeking) and large increases to the earned income tax credit. EITC is pretty much what you’re looking for—a negative income tax—but it only applies to people who are working.
are shared benefits for everyone, not special benefits for the poor (e.g., Social Security, Medicare, Alaska’s oil fund). The social insurance model fits this category. I paid into Medicare so I deserve my benefits. Anyone who gets hurt on the job and is unable to work will collect disability insurance. That’s our oil so we should share the profits. (Alaska’s program has the additional advantage of not needing tax money for funding.)
I think that all of the main safety net programs (listed on the siteslinkedabove) fit pretty cleanly within one (or more) of these four categories, except maybe Pell Grants for college expenses (which is at least loosely related to each of them, but might be better thought of as a part of the publicly funded education system).
To fit into one of these four categories, cash transfers would either need to go to everybody (which would be a huge program, e.g. $10,000 per American would require collecting 20% of GDP in taxes and then redistributing it), or only go to the working poor (which is already done with the EITC), or only go to the particularly needy (which is already done for the disabled and the elderly, and wouldn’t really work for children). Unconditional cash transfers to generic poor people just don’t poll well, and leave politicians vulnerable to political attacks.
Changes at the margin could involve increasing the size of programs that are closest to pure cash transfers (like EITC), shrinking or eliminating programs that involve more meddling (like some kinds of housing assistance), or loosening the restrictions/conditions on specific programs so that there’s less hassle in running it (e.g. eligibility requirements for SNAP). Each individual change has an obvious partisan valence. Another option is to try to make the tax system more progressive (or oppose efforts to make it less progressive) - a simple way for the government to get more money into the hands of the poor people is to collect less tax money from them in the first place. That also has an obvious partisan valence.
I think that one of the main reasons why the US has the complicated welfare state that it does, instead of simple cash transfers, is that unconditional cash transfers to the poor are unpopular among the general public.
I think that’s basically right. The unfortunate side is that lying about the nature of the programs makes the programs less effective. Rationalizations become implementations. A dishonest rationalization keeps people focused on the wrong things, and doing the wrong things.
I think there are two good arguments for a direct redistribution, one common, one not.
The common one is helping the poor. Yes, conservatives want to help the poor too.
The uncommon one is based on justice. Except for propertarian ideologues, I don’t think the proposition that everyone has an equal right to a share in natural resources is that controversial. It’s just that few talk about. As I related earlier, even a Bill OReilly can get on board with that. It’s a peculiarity that there is widespread support for the proposition with respect to “our” oil, whoever “we” might be, but few follow the implications, as Thomas Paine, Henry George, and others have.
There is a final political argument that “this is better than what we do now”. Not quite as satisfying to anyone, but it shouldn’t be dismissed thereby. Political compromise by definition doesn’t align exactly with everyone’s values—until you add in the value placed on having an agreed upon and supported solution, and not continually fighting about it.
(Although that implies something that hadn’t occurred to me before; those who want to fight always have that motivation to prevent a compromise.)
To fit into one of these four categories, cash transfers would either need to go to everybody (which would be a huge program, e.g. $10,000 per American would require collecting 20% of GDP in taxes and then redistributing it),
Much of that money is already collected in taxes, and much of the rest would be an accounting gimmick with withholding taxes. Money disappears from one account and appears in another.
It’s the net spending that matters, and how efficiently it is spent. There’s no particular theoretical difficulty in rejiggering tax rates and payment amounts.
To fit into one of these four categories, cash transfers would either need to go to everybody (which would be a huge program, e.g. $10,000 per American would require collecting 20% of GDP in taxes and then redistributing it),
Much of that money is already collected in taxes, and much of the rest would be an accounting gimmick with withholding taxes. Money disappears from one account and appears in another.
Around 70% of American safety net / welfare state spending goes to people who are elderly or disabled (including Social Security, Medicare, most of Medicaid, SSI, and chunks of various other programs). Keeping the amount of transfers to the elderly & disabled at their current level (either through the current programs or as cash), and giving everyone else in America $10,000 each, would require raising taxes by something like 10% of GDP (assuming that the rest of welfare spending was eliminated). I’d guess that plenty of people on the American left would support a proposal like that if it was on the table (although they’d probably prefer to keep some other components of the current welfare state as well, especially programs for children), but it is not currently a part of the mainstream political discussion and I do not think that Bill O’Reilly would respond favorably to it.
The basic income guarantee has the neat feature that it eliminates some of the perverse incentives of welfare as well as possibly being psychologically much more beneficial since people will know they have a secure revenue stream no matter what, while government programs often require compliance to all sorts of requirements.
while government programs often require compliance to all sorts of requirements.
Situation A: The government takes $1000 from me and gives it to you. Situation B: The government takes $1000 from me and gives it to you … then takes another $1000 from me to pay someone to go around and pry into your personal life.
Any consequentialist libertarian should agree that Situation A involves less loss of liberty for both of us than Situation B does.
Shouldn’t most consequentialist liberals too? This plan is lifestyle blind. If I want to be a bohemian artist, work pro bono full time, edit wikipedia, smoke marijuana or just play Xbox in my basement, I won’t be judged by the electorate or state for it.
government programs often require compliance to all sorts of requirements
In some situations those requirements may be nonsensical or even actively harmful. One usual harmful pattern is using the heuristics “we help more to those who need to be helped most” to detect people trying to improve their situation and then excessively reduce the help given to them. Soon it become common knowledge that if you try to help yourself, you may end worse.
For the libertarians, wouldn’t you, like Friedman, prefer a basic income guarantee to the paternalistic regulatory state?
Asked in this form, this is a request for collecting information about distribution of opinions in the form of a few self-filtered anecdotes. The data thus collected is completely useless, so it might be better to look for data collected elsewhere or by other means.
Suppose then that we do collect such data. In what way would it be useful for the purpose of a theoretical discussion? Opinions themselves may be hard to interpret: different meanings may be intended by the same simplified statement (e.g. one policy may be “preferred” if it magically worked reliably, but a different one may be “preferred” to be actually attempted given the knowledge of how reliably various policies work); the reasons for people holding an opinion may not be indicative of properties of the referents of those opinions (due to errors in reasoning like cultural status quo). Also, opinions (conclusions) are not the best form of data for the purpose of discussing properties of various policies (which would be the basis for making decisions/conclusions).
I think it’s best to avoid questions or declarations of opinion in either overly imprecise form (that would permit significantly different interpretations), or about conclusions that depend on many unclear considerations that should themselves be under discussion. A discussion should go forward from understandable facts to conclusions, not the other way around, from conclusions reached in an unknown manner, to justification of those conclusions.
Asked in this form, this is a request for collecting information about distribution of opinions in the form of a few self-filtered anecdotes. The data thus collected is completely useless,
Suppose then that we do collect such data. In what way would it be useful for the purpose of a theoretical discussion?
No, the data is not completely useless. Limited sampling of a distribution can give you information about the different clusters in the distribution, if not the relative frequency of samples in those clusters.
There are only so many basic arguments for a position. I wanted to see if the clever folks here had one I hadn’t heard before.
I was making a distinction between arguments for a position and statements of a position. The words “asked in this form” in my comment referred to the way you phrased the question, which was as stated about positions and not arguments. Thankfully, the responses were mostly about arguments, although a couple of them opened with statements of positions, which was the unhelpful bit, whose flaws were the topic of my comment.
(Nice point about limited biased samples being adequate for discovering clusters. It seems that this way you may form non-hopeless hypotheses with much less effort than is necessary to quantitatively judge them.)
I see now what you were getting at. Yes, the question as posed to libertarians lacked the request for “why” that my question to liberals did.
As was likely apparent, the libertarian question was an add on to the question to liberals. I’m much more familiar with the basic premises of people who call themselves libertarian, and consider it unlikely that too many libertarians would prefer the hyper regulatory state, though I could make a libertarian argument for it versus the pure redistributionist welfare state.
I was mainly interested in what those crazy liberals are thinking, because what they advocate doesn’t actually effectively fulfill what they say they want. IMO.
The problem with being poor is you don’t have money.
The telltale symptom of being poor is not having money. The problem with being poor is not being able to engage properly with the wealth-generating activities of society, and that happens for a variety of reasons.
Some of those (such as cyclical unemployment or childcare needs) are absolutely best tackled by direct wealth redistribution. Others (such as disability, substance dependency, a criminal record or a lack of marketable skills) by the provision of services, which government may be best placed to orchestrate. Others still (such as statistical discrimination) are most directly addressed by employment legislation, which only the government is in a position to carry out.
All of these interventions can be carried out badly. Since mechanisms of social welfare tend to be one of the big issues on the table for party politics, they usually are carried out badly. This is a problem with prevailing methods of governance, not with welfare programs in and of themselves. It’s far from clear (although quite plausible) that no welfare is preferable to bad welfare.
The problem with being poor is not being able to engage properly with the wealth-generating activities of society, and that happens for a variety of reasons.
Why should every member of a society be wealth generating? Let alone net wealth generating.
To the first approximation people want to do something about poverty because they feel sympathy for people who can’t afford various worldly goods, what they however don’t realize is that above some very low level (above which starvation and death from exposure aren’t factors) their sympathy for the poor is rooted in the poor not being able to afford status markers that if all the poor could afford would cease to be status markers.
Why should every member of a society be wealth generating? Let alone net wealth generating.
I didn’t say they should be.
I have mixed support for your second paragraph, but I’m reluctant to properly respond to it since I don’t see how this comment is a response to the points in mine.
I’m reluctant to properly respond to it since I don’t see how this comment is a response to the points in mine.
I made a poorly written post if that is the case. I hope this might clarify:
The telltale symptom of being poor is not having money. The problem with being poor is not being able to engage properly with the wealth-generating activities of society, and that happens for a variety of reasons.
I dispute this is actually the problem people have with poverty.
I wasn’t talking about the issue non-impoverished people have with poverty, but trying to characterise the sort of situation that makes someone poor. Simply not having much money is the symptom; there are many causes, generally describable as systematic obstacles to acquiring and using capital.
For purposes of this discussion, I don’t especially care why most people don’t like other people being poor. Although making the public feel better about the society they live in shouldn’t be discounted as a positive outcome, this is by no means the primary function of a welfare system.
Yes. I am in favor of an allowance being paid by the government to all citizens. The simplest way to do this would be to impose a flat tax on top of existing income tax, and redistribute the revenue equally to everybody. So that it works out as a negative tax for those making less than average (arithmetic mean) income. People making exactly mean income are unaffected. And the very rich get almost nothing back relative to what they put in.
In the short term, most people would benefit, because most people make less than average. That is, median income is less than mean income, because wealth is concentrated at the top. And net utility would increase, because the marginal utility of each additional dollar is greater for the poor than for the rich.
The long term effects of course are more complicated. But it’s not obvious that this policy would result in less productivity. In the US at least, there’s plenty of room to raise taxes on the rich without approaching historical highs. And for the very poor, having a tax structure like this replace welfare could actually make it easier to transition from complete government dependence to a low-paying job, since there’s no fear of suddenly losing your support.
Arguably if you cut existing welfare and the bureaucracy and infrastructure it requires and giving every adult say 10000 dollars a year, you may not even have to raise taxes. And if you also cut regulation on employment, like the minimal wage or what employers can fire people over (since jobs aren’t required to live a decent life in a low expense city) the economic gains probably increase tax revenue.
The numbers don’t add up. If you change a targeted program into a universal one, you either need large benefit cuts for some people or large tax increases.
The entire safety net / welfare state might be getting close to $10,000 per capita each year, if you define it broadly, but something like half of it goes to the elderly (through Social Security, Medicare, and pieces of other programs like Medicaid). It’s more like $5,000 per person (on average) for those under 65, and $30,000 per person (on average) for those over 65. So a change like yours would require either large benefit cuts for the elderly—eliminating Social Security & Medicare (and other programs they use) and replacing them with a $10,000 check—or (if you keep the spending on the elderly the same) you’d need a large enough tax increase to double per capita spending on the non-elderly from $5,000 to $10,000.
People with disabilities similarly receive a disproportionate amount of welfare spending (through Medicaid, Medicare, SSI, etc.).
Just for accounting purposes, are you liberal, libertarian, something else?
The bonus from an incentive point of view is that poor people on government assistance routinely face the highest marginal tax rates, often over 100%, as they lose benefits as they start to make money.
I’m comfortable with the label “liberal”, but support the basic income guarantee for both liberal and libertarian reasons. I think that relieving people of abject poverty and financial insecurity might make the market freer. But more importantly, it would make people freer to live as they choose, and reduce suffering. Also possibly important: it limits the share of income that the wealthiest people can control.
I suppose I qualify as a liberal for purposes of this question.
If you’re asking whether I’d support this as a political platform, my answer is mostly no. If you’re asking whether I’d support this as a way for the world to be, my answer is mostly yes.
To say that perhaps more clearly... While I don’t think a guaranteed minimum income addresses all problems related to poverty (as sixes_and_sevens points out below), I do think there are a number of poverty-related problems that we currently solve in ways far less sensible than a guaranteed minimum income. If I could wave my magic wand and replace the former with the latter in a politically sustainable way, I probably would. (I haven’t looked into this at all carefully and would have to think much harder about the details if I actually had such a wand, but I’m sympathetic to the strategy.)
OTOH, if I don’t have a wand, but rather have to work through political mechanisms to implement such a policy change, I doubt I support it… it doesn’t seem like a viable political move in my country.
I think it’s good to separate out the two problems.
What state do you prefer? What state does it make sense to work to support, given political viability?
Honestly signaling what you prefer allows the possibility of people seeing that you prefer it too. Political viability for what you’d prefer can be increased by signaling that you prefer it.
For many of the programs we are currently implementing to support poor people, I would prefer a guaranteed minimum income to those programs. If the costs of working towards such a state were not greater than the benefits, I would endorse working towards such a state.
I’m a leftist with some sympathy for libertarianism. I don’t know how typical my views are of left-leaning people on LW, but I’d guess they aren’t absurdly far from typical.
I’m all in favour of redistribution. If by “expropriation” you mean tweaking the tax rates then I’m in favour of that too, with the proviso that I’d want to take a really hard look at the relevant history and economic theory before tweaking them too hard. If you mean something more coercive—large-scale confiscation of property, say—then quite aside from the question of whether it could be just, it would be destabilizing and divisive. Not to mention that in order to do enough good to be worth even considering, it would need to be a really big expropriation.
Part of why I favour a somewhat-paternalistic regulatory state is because in many cases regulation benefits everyone overall by solving coordination problems, and governments are best placed (in status, coercive power, perceived legitimacy, resources, etc.) to solve them in this way. (This is mostly a separate issue from helping the poor.)
The other part is that in many cases where regulation doesn’t benefit everyone, it does provide a clear overall benefit, but the people it benefits have relatively little economic power and therefore markets will settle on equilibria that are worse overall. Roughly, markets solve the problem “maximize net utility weighted by wealth” and I would prefer to solve something nearer to “maximize net utility with equal weight for everyone”. An alternative way to deal with this problem would be to redistribute enough that the differences in economic power go away, but it seems like this would need a really big redistribution, much too big to look either practical or just to me. (This one is about helping the poor, and the reason why giving them money instead won’t do is that they’d need to be given an infeasibly large amount of money.)
I would love to see something like a basic income guarantee. I think it could replace a lot of existing state benefits. Not all; sometimes people suffer terrible things that are very expensive to deal with, and I think governments are well placed to act as insurers in some such cases.
[EDITED to remove parentheses, which I overuse when writing hastily. No substantive changes made.]
Roughly, markets solve the problem “maximize net utility weighted by wealth” and I would prefer to solve something nearer to “maximize net utility with equal weight for everyone”.
Heath insurance programs take extremely expensive costs in the grounds of welfare state policies. To people, is inconceivable to live with private investiments in heath. The compulsive taxes make everyone pay, and only a few are aware of the monetary costs.
Maybe in other sectors welfare state policies end well, but I doubt this happen frequently.
An interesting choice of example. The USA is just about the only otherwise-civilized state that largely leaves healthcare in private hands, and “only a few are aware” (as you put it) that the US government spends about as much per capita on healthcare as, say, the UK government—to be more precise: only two other OECD countries have more government spending on healthcare than the US—and that total US healthcare expenditure is hugely more than that of any other country, and yet its actual outcomes are pretty much on a par with all those other countries that are spending so much less. (E.g., if you order countries by life expectancy at birth, the US comes in at about #50.)
Of course this is a complicated business, obviously affected by other things besides the public/private difference. But, to say the least, the available evidence doesn’t offer much support for the idea that a welfare state providing health insurance ends up being more expensive and less efficient. The only good example we’ve got of taking a different approach goes quite the other way.
I am as libertarian as can be, once one is aware of existential risk.
I prefer a basic income guarantee to a paternalistic regulatory state. I like the NIT for its simplicity, but am opposed to high income taxes. I prefer the georgist land tax. I believe that if the land were taxed well enough, people could not just hold it and make living expensive for other people. Almost everyone would have the option of going a distance and setting up something of their own over there.
That is the taking. Now the spending.
I believe that we should aim towards a meritocracy.
So, most importantly, a strong minimal state providing justice, protection, primary and secondary education should be present. If you’re hitting marginal contribution of zero over there and still have money left, move to the next item that can help.
Basic research into intelligence and conscientiousness augmentation.
Aim to make IQ85s into IQ 110s if possible. If, as a side effect, you can boost some already existing people to higher levels, that’s lovely, but that is not the goal. The goal is to turn 80s and 85s into 110s and 115s.
Basic research into happiness augmentation without affecting effectiveness.
Aim to increase happiness set points across the board.
If you’re hitting marginal returns and still have money left, then try to institute a prize that will be given to firms that employ a large number of workers. The product of wages of the workers is a good proxy to try to aim towards. (This is actually quite hackable, but if done well, it does have the advantage of multiplying the prize amount, using dollar auction effects)
The georgist program is about people compensating others when they presume to control part of a commons. Maybe it is a preferable tax system to taxing labor, but removing the compensation part of the program vitiates the original point.
but removing the compensation part of the program vitiates the original point.
I disagree. Let me explain.
Let us consider 2 worlds. World A has strict lockean property legislation, income taxes, the government investing in infrastructure, justice and otherwise a minimal state.
World B has strict property legislation, land taxes, the government investing in infrastructure, justice and otherwise a minimal state.
In world A, anyone who has moved away from their parents’ home and is seeking their way in the world has to pay 2 charges—rent and taxes. Or if they set up a shop, the full capitalized value of the rent of the land and taxes.
In world B, they have to pay just rent, or if they are setting up a shop, the much lower capitalized value of the rent of the land.
Yes, in world B, the rent may be slightly higher, because the worlds are pretty similar technology wise. But I doubt that the total payment will be as high as World A.
That was benefit 1.
The more important point is the effect of land speculation/maintaining land idle on the margin of production. The margin of production is a georgist concept of the land that is of least value, the land that in classic economics is rent free. Anyone who works the least productive land earns the full product as wages. So, the least productive land sets a floor on the wages in a society, the margin of production.
In world A, there is a tendency to buy land and keep it idle or utilised sub-optimally because of speculation that due to publicly funded improvements/infrastructure which will happen in time, the land will gain in value and later can be sold at a higher rate, without taking any risk. Any capital investment ends up competing with this expected rate of nearly risk free return. This lowers capital investment and pushes the margin of production further and further. A further margin of production implies land of lower value, which implies lower wages. Lower capital investment implies lower wages,
In world B, where there are land taxes, anyone buying any land will buy it only with the intent of using it for a specific purpose. If it is as an investment, they will try getting cash flow out of it. If it is residential, they will calculate the minimum that they can afford and hold it there. This means a higher margin of production, higher capital investment. Both of these imply higher wages, all other things being equal.
That was benefit 2.
In a world of georgist land taxes, there can be significant savings in business from the lower costs of compliance and accounting. Yes, there will be attempts to manipulate land tax also. But there is a certain ceiling to that, because land value can be maintained as a public record. If someone files his returns showing a rate of $10/sq ft when his neighbour without any differences has filed at $20/sq ft, it is too easy to come back and force person 1 for a revision.
So, these 3 benefits are there even for a georgist tax system without any compensation redistribution, just maintaining a minimal rule of law state with investment in infrastructure.
Tax rates even now are on marginal dollars to avoid cut off effects. If the cutoff is X for a tax bracket N, and you make X+1, X dollars are taxed in the N tax bracket, and 1 dollar is taxed at the N+1 tax bracket.
That has not seemed to be the case in the US. I’d expect that to be the case for people who want to help the poor, but it seems that some chunk of libertarians support it, while liberals do not. I believe it got a little bit of play across the board in the 70s among public intellectuals across the board, but I haven’t heard it from the left in political discourse since.
Hence my question—why the regulatory state instead of guaranteed income?
Doubtless you could find people of all political persuasions who feel this way. I have some sympathy for it myself, but I’d still rather have idiots spend money on themselves than idiot bureaucrats spend the money supposedly for the benefit of other idiots.
I saw some video with Milton Friedman where he walked through the various permutations of person A spending person’s B money on person C, where to begin with A=B=C—you spend your money on yourself, and he slowly increased the distance of A,B, C in knowledge and caring, The farther you got from A=B=C, the less value C got per dollar spent.
But I asked to get liberal opinions in particular because it just doesn’t make sense to me, and they may be able to make sense of it without a paternalistic interpretation. Or, they may just endorse paternalism. Either, way, I’d consider it progress in understanding.
One of the best posts recently was a liberal just asking libertarians why they favored what they did. What a great idea. It struck me that we rarely ask; we argue against instead. Thought I’d try something new.
Question for Liberals/Leftists and Libertarians:
I’m from the US and of the libertarian persuasion, though not so propertarian as most US libertarians.
Liberals here seem to want to help the poor and less financially fortunate.
But it seems to me that the means selected to help them always tends to be a paternalistic welfare state—more power and control for the government. I think that’s just bad market economics and political economics—the regulatory state tends to hamper production and destroy wealth, and the rich are much better able to navigate and manipulate the regulatory state. So it’s just a bad prescription for the stated goal.
For the liberals, whatever happened to good old expropriation and redistribution of wealth as the leftist solution? Why not that instead of the paternalistic regulatory state?
The problem with being poor is you don’t have money. Take money from A, and give it to B. I think there are decent arguments for this going back to Thomas Paine and Agrarian Justice, things that even a Bill Oreilly could get on board with (It was amusing and surprising to see Oreilly defending Alaska’s redistribution of oil fees directly to Alaskan citizens—“It’s our oil!” Ha! What a commie!).
I was watching William Buckley debate Milton Friedman on welfare policy, with Friedman in favor of negative income taxes (the problem with poverty is you don’t have money), and Buckley making one paternalistic argument after another why you couldn’t just give the poor money, arguing for a paternalistic regulatory state for those on state assistance.
It occurred to me that the difference between Buckley and Liberals was how many people they thought warranted this kind of paternalistic aid and interference, while Friedman much preferred to let people run their own lives.
For the libertarians, wouldn’t you, like Friedman, prefer a basic income guarantee to the paternalistic regulatory state?
I think that one of the main reasons why the US has the complicated welfare state that it does, instead of simple cash transfers, is that unconditional cash transfers to the poor are unpopular among the general public. They make a lot of people feel like they are being taken advantage of. Instead of working like we are, these people are just mooching off of us. The government is taking our hard-earned money, which we deserve, and giving it to people who don’t deserve it. That feeling was one of the main motivations behind welfare reform in the 1990s (recall “welfare queens”). When the word “redistribution” does come up in American politics, it’s almost always as an accusation by the right against the left (like in response to Barack Obama’s “spread the wealth around” comments during the 2008 election).
If you look at the various safety net programs that the US has (alternate sources), they’re designed in a way that avoids that impression that they are just giving your money to the undeserving poor. The recipient seems deserving, because the program does some combination of the following:
help people who are especially needy, sympathetic, or helpless on their own, like children or the disabled (e.g., SSI, school lunches, CHIP). They’re the ones who really need our aid. Programs for the elderly (like Social Security) might count here too.
meet people’s basic human needs, rather than giving them money which they can spend on anything that they want (e.g., SNAP, housing assistance, Medicaid). Everyone ought to be fed; giving people food doesn’t feel like you’re being taken advantage of in the same way as giving money (and similarly with healthcare, housing, etc.). In some cases, like SNAP (food stamps), this can be pretty close to a pure cash benefit since money is fungible and pretty much everybody buys food. In other cases it involves a lot more meddling.
reward good behavior, giving money to poor people who are doing something to deserve it—especially those that are working or seeking work (e.g., EITC, TANF, job training). This category has grown the most over the past couple decades, with welfare reform (making welfare dependent on employment-seeking) and large increases to the earned income tax credit. EITC is pretty much what you’re looking for—a negative income tax—but it only applies to people who are working.
are shared benefits for everyone, not special benefits for the poor (e.g., Social Security, Medicare, Alaska’s oil fund). The social insurance model fits this category. I paid into Medicare so I deserve my benefits. Anyone who gets hurt on the job and is unable to work will collect disability insurance. That’s our oil so we should share the profits. (Alaska’s program has the additional advantage of not needing tax money for funding.)
I think that all of the main safety net programs (listed on the sites linked above) fit pretty cleanly within one (or more) of these four categories, except maybe Pell Grants for college expenses (which is at least loosely related to each of them, but might be better thought of as a part of the publicly funded education system).
To fit into one of these four categories, cash transfers would either need to go to everybody (which would be a huge program, e.g. $10,000 per American would require collecting 20% of GDP in taxes and then redistributing it), or only go to the working poor (which is already done with the EITC), or only go to the particularly needy (which is already done for the disabled and the elderly, and wouldn’t really work for children). Unconditional cash transfers to generic poor people just don’t poll well, and leave politicians vulnerable to political attacks.
Changes at the margin could involve increasing the size of programs that are closest to pure cash transfers (like EITC), shrinking or eliminating programs that involve more meddling (like some kinds of housing assistance), or loosening the restrictions/conditions on specific programs so that there’s less hassle in running it (e.g. eligibility requirements for SNAP). Each individual change has an obvious partisan valence. Another option is to try to make the tax system more progressive (or oppose efforts to make it less progressive) - a simple way for the government to get more money into the hands of the poor people is to collect less tax money from them in the first place. That also has an obvious partisan valence.
I think that’s basically right. The unfortunate side is that lying about the nature of the programs makes the programs less effective. Rationalizations become implementations. A dishonest rationalization keeps people focused on the wrong things, and doing the wrong things.
I think there are two good arguments for a direct redistribution, one common, one not.
The common one is helping the poor. Yes, conservatives want to help the poor too.
The uncommon one is based on justice. Except for propertarian ideologues, I don’t think the proposition that everyone has an equal right to a share in natural resources is that controversial. It’s just that few talk about. As I related earlier, even a Bill OReilly can get on board with that. It’s a peculiarity that there is widespread support for the proposition with respect to “our” oil, whoever “we” might be, but few follow the implications, as Thomas Paine, Henry George, and others have.
There is a final political argument that “this is better than what we do now”. Not quite as satisfying to anyone, but it shouldn’t be dismissed thereby. Political compromise by definition doesn’t align exactly with everyone’s values—until you add in the value placed on having an agreed upon and supported solution, and not continually fighting about it.
(Although that implies something that hadn’t occurred to me before; those who want to fight always have that motivation to prevent a compromise.)
Much of that money is already collected in taxes, and much of the rest would be an accounting gimmick with withholding taxes. Money disappears from one account and appears in another.
It’s the net spending that matters, and how efficiently it is spent. There’s no particular theoretical difficulty in rejiggering tax rates and payment amounts.
Around 70% of American safety net / welfare state spending goes to people who are elderly or disabled (including Social Security, Medicare, most of Medicaid, SSI, and chunks of various other programs). Keeping the amount of transfers to the elderly & disabled at their current level (either through the current programs or as cash), and giving everyone else in America $10,000 each, would require raising taxes by something like 10% of GDP (assuming that the rest of welfare spending was eliminated). I’d guess that plenty of people on the American left would support a proposal like that if it was on the table (although they’d probably prefer to keep some other components of the current welfare state as well, especially programs for children), but it is not currently a part of the mainstream political discussion and I do not think that Bill O’Reilly would respond favorably to it.
A basic income guarantee is also endorsed by Charles Murray in his book In Our Hands : A Plan To Replace The Welfare State.
The basic income guarantee has the neat feature that it eliminates some of the perverse incentives of welfare as well as possibly being psychologically much more beneficial since people will know they have a secure revenue stream no matter what, while government programs often require compliance to all sorts of requirements.
http://old.nationalreview.com/interrogatory/qa200603270732.asp
Interview of Murray about the book.
As per usual, he seems like a reasonable fellow.
Situation A: The government takes $1000 from me and gives it to you.
Situation B: The government takes $1000 from me and gives it to you … then takes another $1000 from me to pay someone to go around and pry into your personal life.
Any consequentialist libertarian should agree that Situation A involves less loss of liberty for both of us than Situation B does.
Shouldn’t most consequentialist liberals too? This plan is lifestyle blind. If I want to be a bohemian artist, work pro bono full time, edit wikipedia, smoke marijuana or just play Xbox in my basement, I won’t be judged by the electorate or state for it.
In some situations those requirements may be nonsensical or even actively harmful. One usual harmful pattern is using the heuristics “we help more to those who need to be helped most” to detect people trying to improve their situation and then excessively reduce the help given to them. Soon it become common knowledge that if you try to help yourself, you may end worse.
Asked in this form, this is a request for collecting information about distribution of opinions in the form of a few self-filtered anecdotes. The data thus collected is completely useless, so it might be better to look for data collected elsewhere or by other means.
Suppose then that we do collect such data. In what way would it be useful for the purpose of a theoretical discussion? Opinions themselves may be hard to interpret: different meanings may be intended by the same simplified statement (e.g. one policy may be “preferred” if it magically worked reliably, but a different one may be “preferred” to be actually attempted given the knowledge of how reliably various policies work); the reasons for people holding an opinion may not be indicative of properties of the referents of those opinions (due to errors in reasoning like cultural status quo). Also, opinions (conclusions) are not the best form of data for the purpose of discussing properties of various policies (which would be the basis for making decisions/conclusions).
I think it’s best to avoid questions or declarations of opinion in either overly imprecise form (that would permit significantly different interpretations), or about conclusions that depend on many unclear considerations that should themselves be under discussion. A discussion should go forward from understandable facts to conclusions, not the other way around, from conclusions reached in an unknown manner, to justification of those conclusions.
No, the data is not completely useless. Limited sampling of a distribution can give you information about the different clusters in the distribution, if not the relative frequency of samples in those clusters.
There are only so many basic arguments for a position. I wanted to see if the clever folks here had one I hadn’t heard before.
I was making a distinction between arguments for a position and statements of a position. The words “asked in this form” in my comment referred to the way you phrased the question, which was as stated about positions and not arguments. Thankfully, the responses were mostly about arguments, although a couple of them opened with statements of positions, which was the unhelpful bit, whose flaws were the topic of my comment.
(Nice point about limited biased samples being adequate for discovering clusters. It seems that this way you may form non-hopeless hypotheses with much less effort than is necessary to quantitatively judge them.)
I see now what you were getting at. Yes, the question as posed to libertarians lacked the request for “why” that my question to liberals did.
As was likely apparent, the libertarian question was an add on to the question to liberals. I’m much more familiar with the basic premises of people who call themselves libertarian, and consider it unlikely that too many libertarians would prefer the hyper regulatory state, though I could make a libertarian argument for it versus the pure redistributionist welfare state.
I was mainly interested in what those crazy liberals are thinking, because what they advocate doesn’t actually effectively fulfill what they say they want. IMO.
The telltale symptom of being poor is not having money. The problem with being poor is not being able to engage properly with the wealth-generating activities of society, and that happens for a variety of reasons.
Some of those (such as cyclical unemployment or childcare needs) are absolutely best tackled by direct wealth redistribution. Others (such as disability, substance dependency, a criminal record or a lack of marketable skills) by the provision of services, which government may be best placed to orchestrate. Others still (such as statistical discrimination) are most directly addressed by employment legislation, which only the government is in a position to carry out.
All of these interventions can be carried out badly. Since mechanisms of social welfare tend to be one of the big issues on the table for party politics, they usually are carried out badly. This is a problem with prevailing methods of governance, not with welfare programs in and of themselves. It’s far from clear (although quite plausible) that no welfare is preferable to bad welfare.
Why should every member of a society be wealth generating? Let alone net wealth generating.
To the first approximation people want to do something about poverty because they feel sympathy for people who can’t afford various worldly goods, what they however don’t realize is that above some very low level (above which starvation and death from exposure aren’t factors) their sympathy for the poor is rooted in the poor not being able to afford status markers that if all the poor could afford would cease to be status markers.
I didn’t say they should be.
I have mixed support for your second paragraph, but I’m reluctant to properly respond to it since I don’t see how this comment is a response to the points in mine.
I made a poorly written post if that is the case. I hope this might clarify:
I dispute this is actually the problem people have with poverty.
Right. That makes more sense.
I wasn’t talking about the issue non-impoverished people have with poverty, but trying to characterise the sort of situation that makes someone poor. Simply not having much money is the symptom; there are many causes, generally describable as systematic obstacles to acquiring and using capital.
For purposes of this discussion, I don’t especially care why most people don’t like other people being poor. Although making the public feel better about the society they live in shouldn’t be discounted as a positive outcome, this is by no means the primary function of a welfare system.
No, actually the lack of money is the problem.
Give a poor person $10mil, and his poverty problem is solved.
Are you being serious?
Yes. I am in favor of an allowance being paid by the government to all citizens. The simplest way to do this would be to impose a flat tax on top of existing income tax, and redistribute the revenue equally to everybody. So that it works out as a negative tax for those making less than average (arithmetic mean) income. People making exactly mean income are unaffected. And the very rich get almost nothing back relative to what they put in.
In the short term, most people would benefit, because most people make less than average. That is, median income is less than mean income, because wealth is concentrated at the top. And net utility would increase, because the marginal utility of each additional dollar is greater for the poor than for the rich.
The long term effects of course are more complicated. But it’s not obvious that this policy would result in less productivity. In the US at least, there’s plenty of room to raise taxes on the rich without approaching historical highs. And for the very poor, having a tax structure like this replace welfare could actually make it easier to transition from complete government dependence to a low-paying job, since there’s no fear of suddenly losing your support.
Arguably if you cut existing welfare and the bureaucracy and infrastructure it requires and giving every adult say 10000 dollars a year, you may not even have to raise taxes. And if you also cut regulation on employment, like the minimal wage or what employers can fire people over (since jobs aren’t required to live a decent life in a low expense city) the economic gains probably increase tax revenue.
The numbers don’t add up. If you change a targeted program into a universal one, you either need large benefit cuts for some people or large tax increases.
The entire safety net / welfare state might be getting close to $10,000 per capita each year, if you define it broadly, but something like half of it goes to the elderly (through Social Security, Medicare, and pieces of other programs like Medicaid). It’s more like $5,000 per person (on average) for those under 65, and $30,000 per person (on average) for those over 65. So a change like yours would require either large benefit cuts for the elderly—eliminating Social Security & Medicare (and other programs they use) and replacing them with a $10,000 check—or (if you keep the spending on the elderly the same) you’d need a large enough tax increase to double per capita spending on the non-elderly from $5,000 to $10,000.
People with disabilities similarly receive a disproportionate amount of welfare spending (through Medicaid, Medicare, SSI, etc.).
Just for accounting purposes, are you liberal, libertarian, something else?
The bonus from an incentive point of view is that poor people on government assistance routinely face the highest marginal tax rates, often over 100%, as they lose benefits as they start to make money.
I’m comfortable with the label “liberal”, but support the basic income guarantee for both liberal and libertarian reasons. I think that relieving people of abject poverty and financial insecurity might make the market freer. But more importantly, it would make people freer to live as they choose, and reduce suffering. Also possibly important: it limits the share of income that the wealthiest people can control.
I suppose I qualify as a liberal for purposes of this question.
If you’re asking whether I’d support this as a political platform, my answer is mostly no.
If you’re asking whether I’d support this as a way for the world to be, my answer is mostly yes.
To say that perhaps more clearly...
While I don’t think a guaranteed minimum income addresses all problems related to poverty (as sixes_and_sevens points out below), I do think there are a number of poverty-related problems that we currently solve in ways far less sensible than a guaranteed minimum income. If I could wave my magic wand and replace the former with the latter in a politically sustainable way, I probably would. (I haven’t looked into this at all carefully and would have to think much harder about the details if I actually had such a wand, but I’m sympathetic to the strategy.)
OTOH, if I don’t have a wand, but rather have to work through political mechanisms to implement such a policy change, I doubt I support it… it doesn’t seem like a viable political move in my country.
I think it’s good to separate out the two problems.
What state do you prefer? What state does it make sense to work to support, given political viability?
Honestly signaling what you prefer allows the possibility of people seeing that you prefer it too. Political viability for what you’d prefer can be increased by signaling that you prefer it.
I thought I’d answered that?
For many of the programs we are currently implementing to support poor people, I would prefer a guaranteed minimum income to those programs. If the costs of working towards such a state were not greater than the benefits, I would endorse working towards such a state.
I’m a leftist with some sympathy for libertarianism. I don’t know how typical my views are of left-leaning people on LW, but I’d guess they aren’t absurdly far from typical.
I’m all in favour of redistribution. If by “expropriation” you mean tweaking the tax rates then I’m in favour of that too, with the proviso that I’d want to take a really hard look at the relevant history and economic theory before tweaking them too hard. If you mean something more coercive—large-scale confiscation of property, say—then quite aside from the question of whether it could be just, it would be destabilizing and divisive. Not to mention that in order to do enough good to be worth even considering, it would need to be a really big expropriation.
Part of why I favour a somewhat-paternalistic regulatory state is because in many cases regulation benefits everyone overall by solving coordination problems, and governments are best placed (in status, coercive power, perceived legitimacy, resources, etc.) to solve them in this way. (This is mostly a separate issue from helping the poor.)
The other part is that in many cases where regulation doesn’t benefit everyone, it does provide a clear overall benefit, but the people it benefits have relatively little economic power and therefore markets will settle on equilibria that are worse overall. Roughly, markets solve the problem “maximize net utility weighted by wealth” and I would prefer to solve something nearer to “maximize net utility with equal weight for everyone”. An alternative way to deal with this problem would be to redistribute enough that the differences in economic power go away, but it seems like this would need a really big redistribution, much too big to look either practical or just to me. (This one is about helping the poor, and the reason why giving them money instead won’t do is that they’d need to be given an infeasibly large amount of money.)
I would love to see something like a basic income guarantee. I think it could replace a lot of existing state benefits. Not all; sometimes people suffer terrible things that are very expensive to deal with, and I think governments are well placed to act as insurers in some such cases.
[EDITED to remove parentheses, which I overuse when writing hastily. No substantive changes made.]
Wow, that’s a fantastic way of phrasing it.
Glad to be of service!
Heath insurance programs take extremely expensive costs in the grounds of welfare state policies. To people, is inconceivable to live with private investiments in heath. The compulsive taxes make everyone pay, and only a few are aware of the monetary costs.
Maybe in other sectors welfare state policies end well, but I doubt this happen frequently.
An interesting choice of example. The USA is just about the only otherwise-civilized state that largely leaves healthcare in private hands, and “only a few are aware” (as you put it) that the US government spends about as much per capita on healthcare as, say, the UK government—to be more precise: only two other OECD countries have more government spending on healthcare than the US—and that total US healthcare expenditure is hugely more than that of any other country, and yet its actual outcomes are pretty much on a par with all those other countries that are spending so much less. (E.g., if you order countries by life expectancy at birth, the US comes in at about #50.)
Of course this is a complicated business, obviously affected by other things besides the public/private difference. But, to say the least, the available evidence doesn’t offer much support for the idea that a welfare state providing health insurance ends up being more expensive and less efficient. The only good example we’ve got of taking a different approach goes quite the other way.
I am as libertarian as can be, once one is aware of existential risk.
I prefer a basic income guarantee to a paternalistic regulatory state. I like the NIT for its simplicity, but am opposed to high income taxes. I prefer the georgist land tax. I believe that if the land were taxed well enough, people could not just hold it and make living expensive for other people. Almost everyone would have the option of going a distance and setting up something of their own over there.
That is the taking. Now the spending.
I believe that we should aim towards a meritocracy.
So, most importantly, a strong minimal state providing justice, protection, primary and secondary education should be present. If you’re hitting marginal contribution of zero over there and still have money left, move to the next item that can help.
Basic research into intelligence and conscientiousness augmentation. Aim to make IQ85s into IQ 110s if possible. If, as a side effect, you can boost some already existing people to higher levels, that’s lovely, but that is not the goal. The goal is to turn 80s and 85s into 110s and 115s.
Basic research into happiness augmentation without affecting effectiveness. Aim to increase happiness set points across the board.
If you’re hitting marginal returns and still have money left, then try to institute a prize that will be given to firms that employ a large number of workers. The product of wages of the workers is a good proxy to try to aim towards. (This is actually quite hackable, but if done well, it does have the advantage of multiplying the prize amount, using dollar auction effects)
After all these, if you still have money left, one can try the NIT or Morgan Warstler’s variant
The georgist program is about people compensating others when they presume to control part of a commons. Maybe it is a preferable tax system to taxing labor, but removing the compensation part of the program vitiates the original point.
I disagree. Let me explain.
Let us consider 2 worlds. World A has strict lockean property legislation, income taxes, the government investing in infrastructure, justice and otherwise a minimal state.
World B has strict property legislation, land taxes, the government investing in infrastructure, justice and otherwise a minimal state.
In world A, anyone who has moved away from their parents’ home and is seeking their way in the world has to pay 2 charges—rent and taxes. Or if they set up a shop, the full capitalized value of the rent of the land and taxes.
In world B, they have to pay just rent, or if they are setting up a shop, the much lower capitalized value of the rent of the land.
Yes, in world B, the rent may be slightly higher, because the worlds are pretty similar technology wise. But I doubt that the total payment will be as high as World A.
That was benefit 1.
The more important point is the effect of land speculation/maintaining land idle on the margin of production. The margin of production is a georgist concept of the land that is of least value, the land that in classic economics is rent free. Anyone who works the least productive land earns the full product as wages. So, the least productive land sets a floor on the wages in a society, the margin of production.
In world A, there is a tendency to buy land and keep it idle or utilised sub-optimally because of speculation that due to publicly funded improvements/infrastructure which will happen in time, the land will gain in value and later can be sold at a higher rate, without taking any risk. Any capital investment ends up competing with this expected rate of nearly risk free return. This lowers capital investment and pushes the margin of production further and further. A further margin of production implies land of lower value, which implies lower wages. Lower capital investment implies lower wages,
In world B, where there are land taxes, anyone buying any land will buy it only with the intent of using it for a specific purpose. If it is as an investment, they will try getting cash flow out of it. If it is residential, they will calculate the minimum that they can afford and hold it there. This means a higher margin of production, higher capital investment. Both of these imply higher wages, all other things being equal.
That was benefit 2.
In a world of georgist land taxes, there can be significant savings in business from the lower costs of compliance and accounting. Yes, there will be attempts to manipulate land tax also. But there is a certain ceiling to that, because land value can be maintained as a public record. If someone files his returns showing a rate of $10/sq ft when his neighbour without any differences has filed at $20/sq ft, it is too easy to come back and force person 1 for a revision.
So, these 3 benefits are there even for a georgist tax system without any compensation redistribution, just maintaining a minimal rule of law state with investment in infrastructure.
Wouldn’t negative income tax be a fairly strong incentive to stay/become unemployed for those near the cut-off?
Tax rates even now are on marginal dollars to avoid cut off effects. If the cutoff is X for a tax bracket N, and you make X+1, X dollars are taxed in the N tax bracket, and 1 dollar is taxed at the N+1 tax bracket.
This is why I prefer guaranteed minimum income
I tend to associate the idea of a citizen’s income with the left—eg, the green party in the UK: http://en.wikipedia.org/wiki/Green_Party_of_England_and_Wales#Economy
That has not seemed to be the case in the US. I’d expect that to be the case for people who want to help the poor, but it seems that some chunk of libertarians support it, while liberals do not. I believe it got a little bit of play across the board in the 70s among public intellectuals across the board, but I haven’t heard it from the left in political discourse since.
Hence my question—why the regulatory state instead of guaranteed income?
Liberals feel Poor people are too dumb to be trusted with money, but no liberal is allowed to say and/or think this.
Doubtless you could find people of all political persuasions who feel this way. I have some sympathy for it myself, but I’d still rather have idiots spend money on themselves than idiot bureaucrats spend the money supposedly for the benefit of other idiots.
I saw some video with Milton Friedman where he walked through the various permutations of person A spending person’s B money on person C, where to begin with A=B=C—you spend your money on yourself, and he slowly increased the distance of A,B, C in knowledge and caring, The farther you got from A=B=C, the less value C got per dollar spent.
But I asked to get liberal opinions in particular because it just doesn’t make sense to me, and they may be able to make sense of it without a paternalistic interpretation. Or, they may just endorse paternalism. Either, way, I’d consider it progress in understanding.
One of the best posts recently was a liberal just asking libertarians why they favored what they did. What a great idea. It struck me that we rarely ask; we argue against instead. Thought I’d try something new.
Ouch. Careful; LW standards still apply here. I’d like to have this nice thread of mine, but this kind of shit can get it killed.
Everyone, please give the above comment 10 or so downvotes.