Political arguments often start with a conclusion someone wants to defend. He comes up with an argument to defend it. Sometimes the argument, carefully examined, leads to the wrong conclusion. Examples:
Income Redistribution and Initial Appropriation
Justifying ownership of things made by human beings is easy: I made it, I own it. That does not work for things such as land that were not created by human action. Locke’s solution was that one makes unowned land into your property by mixing your labor with it, clearing the forest or digging out the boulders — provided that there is as much and as good land left for other people.
Eventually we will run out of good unowned land, so each person who propertizes a piece of land is depriving some future person of the opportunity to do so: The exception swallows the rule. Some libertarians solve this problem by converting Locke’s “as much and as good” to the requirement that nobody is made worse off by the conversion of land from commons to property. They conclude that anyone who is made worse off is entitled to compensation — a libertarian justification for welfare payments, that being the conclusion they wanted an argument to justify:
The problem that appears here is that, although the regime of private property obtained in the process of original appropriation leads to social prosperity and, by this, to the betterment of condition for many members of that society, the Lockean proviso is deeply individualistic and there may be cases – or even a generalized phenomenon – in which some individuals are actually worse-off as a result of the original appropriation.
(Zwolinski, Matt, “Property Rights, Coercion, and the Welfare State: The Libertarian Case for a Basic Income for All.” The Independent Review 19, no.4.)
The argument may justify income transfers, but the wrong ones. Someone blind or crippled may be deserving of help, but his odds of survival in the world as it is are much better than they would be in the much poorer world we would be in if land had never been treated as property, so he is entitled to no compensation. Someone big and strong and good at living in the jungle, with the skills to enslave weaker people and make them serve him, on the other hand, might well be worse off when the jungle is converted to private farms.
I do not think that is the conclusion people who want a libertarian justification for welfare payments or a basic income were looking for.
Reparations for Slavery
Black slavery in America was a massive wrong by almost
anyone’s standards, so it is natural to ask whether anyone is owed compensation for it
and from whom. Present African-Americans have not been enslaved and are better off than their ancestors’
descendants would be if there had been no slavery, but arguably they inherit their ancestors' claims.
Who are they claims against? Most present-day Americans are descended
from people who never owned slaves, mostly people who came to the New World after
slavery was abolished. The people who initially captured the slaves, on the other hand, had at least as much responsibility as the people they sold them
to, arguably more. The slaves were captured by Africans. Given eight or nine generations from then to now, it’s safe to conclude
that almost everyone in the relevant parts of Africa has some slave hunting ancestors. So if the basis for compensation is
inherited debt, the argument for taxing the present inhabitants of West Africa
to compensate Afro-Americans is stronger than the argument for taxing the
present inhabitants of the U.S., making reparations on net a transfer from poor to rich rather than the other way around.
Not the conclusion that people making the argument wanted.
A weaker form of the same problem occurs when the argument supports the conclusion only if you are very selective in which parts of it you look at. I encountered examples recently in Markets Not Capitalism, a book of essays by people who self identify as left libertarians. Their project, implied if not stated, is to persuade socialists that they should be libertarians by showing that most of what socialists dislike about present “capitalist” societies is the product of government intervention and would not exist, or at least exist much less, in a “freed” economy.
Leftists dislike Walmart:
The funding of public highways through tax revenues, for example, constitutes a de facto transportation subsidy, allowing Wal-Mart and similar chains to socialize the costs of shipping and so enabling them to compete more successfully against local businesses; the low prices we enjoy at Wal-Mart in our capacity as consumers are thus made possible in part by our having already indirectly subsidized Wal-Mart’s operating costs in our capacity as taxpayers. (MnC Chapter 20).
They also dislike urban sprawl, aka suburbs:
A good analogy is subsidies to freeways and urban sprawl, which make our feet less usable and raise living expenses by enforcing artificial dependence on cars. (MnC Chapter 40).
The subsidy is real, since only part of highway expenditure is paid for by transportation taxes and fees, but it is only part of the story. Until 1980, eighteen years after Walmart was started, trucking was cartelized by the ICC, greatly increasing its cost. Further, the highway system is built and maintained by governments and libertarians expect governments to produce goods and services less efficiently than private firms. One effect made transport less expensive, two made it more expensive. That leaves the question of whether Walmart would do better or worse in a freed market open — unless you take care to only mention the one effect that fits your argument.
There is a further problem with the anti-urban sprawl part of the argument. The subsidy to highways, if entirely allocated to passenger transportation, was about one cent a passenger mile. The subsidy to mass transit, the urban alternative to automobiles, was about a dollar a passenger mile. Insofar as government subsidies affected the choice between automobiles and transit it biased it in favor of transit, suggesting that abolition of government would lead to more suburban living, not less — although of course there might be other effects in the opposite direction.
Very nice, tight reasoning. Thank you.
The argument against Walmart is defective in other ways as well.
"[T]he low prices we enjoy at Wal-Mart in our capacity as consumers are thus made possible in part by our having already indirectly subsidized Wal-Mart's operating costs in our capacity as taxpayers."
This argument is not quantitative enough. If I pay $1 in taxes in order to save $20 at Walmart, then it's still a good deal for me. The guy who hates Walmart needs to cover this point.
The tone of the anti-Walmart argument makes it sound as if Walmart is at fault for the roads being partially subsidised by general government funds. Yet, government, not Walmart, sets the tax rates.
So the roads are partially subsidized by general revenues. It is relevant who pays the taxes that contribute to these general revenues. Most taxes are paid by rich guys. Who benefits from the low prices at Walmart? Mostly lower-income guys. So there may well be a flow from rich to poor via these road subsidies. The tone of the anti-Walmart argument makes it sound as if Walmart (its shareholders?) are ripping off the average guy, via the road subsidy. Doubtful. The guy making the anti-Walmart argument bears the burden of proof to establish his own point.
Elizabeth Warren did a similar spiel about how the success of the rich man is paid for by the "rest of us". "You moved your goods to market on the roads the rest of us paid for." Etc. The problem with her argument is that the rich factory owner, through his higher taxes in the progressive tax system, probably has already paid for more than his share of the roads, education, etc. She claims that the "rest of us" paid for the road, failing to credit the contribution of the rich man himself, through his taxes. When you fix Warren's incorrect accounting, her argument vanishes.
The distortion in favor of automobiles is in not charging marginal cost (including congestion) for use of streets and roads including.
I think the Lockean argument for redistribution or reparations is really just a refutation of the argument that "what I have was obtained without fraud or violence." OK Now let's START the conversation about redistribution.
"The subsidy to highways, if entirely allocated to passenger transportation, was about one cent a passenger mile. The subside to mass transit, the urban alternative to automobiles, was about a dollar a passenger mile. Insofar as government subsidies affected the choice between automobiles and transit it biased it in favor of transit, suggesting that abolition of government would lead to more suburban living"
Doesn't the effect depend on how many subsidies are actually taken and used, as well as how much people use public transit?
There are definitely effects in the opposite direction - large ones, I think.
Overtime pay rules (50 to 100% wage premium/hour) drive a lot of urban sprawl. Many hourly employees would like to work more than 40 hours/week, but employers are unwilling to pay the jacked-up overtime wage rates.
So, instead of working more hours, employees commute long distances from suburbs, where housing is cheaper. It's a way of trading time for a larger disposable income that's not effectively prohibited.
I’m willing to bet that the growth of urban sprawl closely tracks the introduction of wage-and-hour regulations.
(I must credit my lovely wife for this theory, who discovered it by experience with her own employees.)
One could argue reparations has to do with unjust enrichment. If this is so white America would probably pay more than Africans who were less enriched.
Fruo: The subsidy per mile depends on how much is used — it's the total subsidy divided by the number of passenger miles. The effect is to make the cost of urban transit lower by a dollar a mile, of highway driving by something under a penny a mile — since some of the subsidy should be allocated to trucks.
Mugwump: Interesting point. California requires overtime for anything more than eight hours in a day — the Federal rules is more than 40 hours in a week. So the California rule punishes a four day/40 hour week, which would be attractive for someone with a long commute.
Martin: The Africans who captured the slaves were enriched by selling them. It isn't clear that anyone, African or American, is richer now due to slavery having happened.
Thomas: Motor fuel taxes are charged per gallon to pay for highway maintenance. These taxes exist on both the state and federal levels. Although the per-gallon tax is not directly related to road usage, there should be a significant correlation. So, Walmart's fleet of trucks is definitely contributing a lot of taxes as they move goods over the highways.
Obviously, any road funding beyond these excise taxes would not have the same features, and your comment would still apply.
I was giving the figure for the net subsidy — goverment expenditure on highways minus highway taxes and fees.
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