"On a core emotional level, the left is anti-market."
I don't think this characterisation is fair for Bruenig, he gave practical and philosophical reasons for disliking aspects of markets and conceded market orientated supply side solutions could work in some situations. Someone who was emotionally opposed to markets wouldn't have conceded that.
If he's more concerned about redistribution than over-regulation it just shows that he views one as a more serious problem than the other, not that he rejects market-solutions on principle, which he explicitly didn't.
It it actually true that means tested benefits are cheaper than universal ones?
Means testing itself it expensive. People have to evaluate claims, and there will inevitably be fraud, and this all requires bureaucracy which will be self-interested and a target for corruption in its own right. And then the means test itself deters some of the people you want to help because completing it has a cost to them too. And the more precisely you try to target benefits, the larger these costs become.
If you contrast that with UBI, the implementation of UBI in the ideal case is just a program to submit a bunch of bank transactions. The amount of money being moved is much larger, but moving money in and of itself isn't expensive, and much of the money is being given straight back to the people who paid it in taxes, and you can encourage people to remove themselves from the actual payment system and claim a tax credit instead, which alleviates any concern about borrowing costs.
I’ve always found the dispute regarding the moral justification of property to be largely a distraction. Even if it turns out that we aren’t really sure what the most plausible justification for private property is, we don’t even have a good definition of private property as of now. There are more and more opportunities to obtain wealth without productive property in the traditional sense. Secondly, private property is a solution to a coordination problem that generally enables mutual benefits. It’s a stable solution such that disrupting would do more harm than good. So even if we lack a moral justification, we still have a normative concern to maintain institutions that maintain and even enhance mutual cooperation.
No that’s not utilitarianism. Nothing I said here implies utilitarianism. The badness of harm is widely agreed upon by every moral theory. Consequences matter to every moral theory. The difference is that utilitarianism says *only* consequences matter, but nothing I said above commits me to that.
I didn't say you were utilitarian. I said as long as you are a utilitarian, that's your moral justification, nothing else is needed. A utilitarian does not lack moral justification for private property.
1. "Without the welfare state, resistance to immigration would be markedly lower, so immigration would be markedly higher." This neglects to mention that without the welfare state inducements, immigration would be lower. This neglect happens so often in pro-immigration discussions that one begins to suspect it is an inconvenient truth.
2. The idea that property either does not exist or is immoral and should be strictly limited by government is an argument for slavery. If I make chairs for a living at 10 hours per chair, there is no practical difference between someone stealing a chair I had already made (theft) and someone threatening to shoot my family unless I make a new chair (slavery). Theft is slavery after the fact, and slavery is theft before the fact. They are one and the same. When the government denies property exists as a concept, or authorizes stealing "excess" property, it has enabled enslaving me.
The supply of immigrants would reduce sure. In other words, the amount of people wanting to immigrate would be smaller. But given that immigration is heavily restricted, if you both reduce the supply but also relax the constraints, it's not obvious what would happen. Intuitively for me the constraints are much more significant than the welfare incentives.
I look back at the pre-WW I immigration as the best available guide to immigration without government restrictions or inducements (ignoring criminal and health restrictions and familial and charity inducements). There’s no way to prove anything, which makes most arguments about it pure speculation. Pre-WW I immigration was the closest we’ve ever had, but now cheap and safe air travel make return visits possible, and the internet and cell phones allow instant communications. That makes immigration a lot easier and risk-free, especially compared to pre-1850 sea travel without steamships.
The hypothesis of welfare state as migration magnet is very weakly supported in the existing research. What matters more is the employment opportunity & the network (e.g. same ethnic groups) in the host nations.
This notion that people are not entitled to their endowments also needs to be debunked. To the extent that a person has good genetics, a good upbringing, or monetary support from their family, they deserve these things in the same way they deserve any other gift. We respect their claim on these gifts because we respect the property rights of the gift givers to do the giving.
I also find it funny how most of the "you didn't build that" crowd would balk at the suggestion that a family should be able to force their children to provide 30% of lifetime income as compensation for benefits provided but don't bat an eye when the government makes the same demand for the same reasons.
1. "Bruenig grants that socialism is a continuum. Which allows me to ask, iIf full socialism is at one end of the continuum, what’s at the other end?' The obvious answer is something like “laissez-faire capitalism,"
Not necessarily. This pedantic and maybe semantic, but the question is whether Bruenig said socialism is *on* a continuum or *is* a continuum. If it *is* a continuum, then laissez faire doesn't necessarily have any place on it. I don't think that's good framing of the real political-economic world, but it's way a socialist could think.
2. “taxing everyone to help everyone.”
Socialists have a profound analytical problem with this, and if any have really dealt with it, I haven't seen it. It's worth spelling out clearly. 1. Somebody has to handle the transfer process, and they have to be paid. This may be minimized by a negative income tax, but it doesn't disappear. So there is necessarily a net loss in the process (unless we consider paying someone merely to handle transfers a productive task). 2. So the argument must be that the net good done for the recipients of the transfer outweigh the deadweight cost, whether we measure that in increased productivity from the spending of the recipient (dubious) or in ethical terms (harder to measure either way). But the more that transfers become between people of the same economic class, the more impossible it becomes to say they do either economic or ethical good. 3. So the possibility for the transfers to have either economic or ethical net value must be for the transfers to go just from the well off to the not-well off. And while socialists will state this as their goal, they nonetheless fall into the trap of supporting within-class transfers. And they implicitly - although I don't think they ever are open about this - must assume that somehow the within-class transfer passing through the hands of the government officials handling the process actually gains in value. They seem to implicitly believe that there is some purely government addition in value - whether they think money can come purely from the government or through some other magic.
3. "on the morality of property itself"
I think this is an easier issue than most people - including property defenders - realize. Simply, all societies have had some degree of private property. The anthropological literature makes this clear. It's not always a full regime of possession that we westerners are accustomed to, but there are no fully communist societies in the literature - there is always some degree of "this is mine; that is yours," and at an absolute minimum guarantees right of first use claim (if I am not using my fishing boat today, then, and only then, may you use it without explicit permission). So, simply put, property rights are natural, and they arise simply through social agreement to respect others' claims to resources, within whatever bounds that society has developed from the ground up, through what we might call Ostromian spontaneous evolved order. It cannot be inherently unjust to have property, then, even if we argue that there are some conceivable property claims that would be unjust.
4. "no one deserves his place in the distribution of native endowments, any more than one deserves one’s initial starting place in society."
I think this is true, but it does not follow that any human devised and operated system can make initial distributions or starting places *more* just. We have to remember that just because an abstract proposal seems plausible, does not mean that we understand its actual full effects or that there is any real prospect that it will become the actual system devised and evolved over time (the product of human action, not design) will achieve that ideal.
If socialism *is* a continuum, then one end is less socialist than the other, and you must be able to define a variety of socialism at the very least socialist end. Then imagine its immediate neighbor across the line which you call the limit to socialism. What separates the two? What do you call the non-socialist economy that is just one teensy tiny bit separated from the least socialist economy, if not capitalist? Or do you posit some other economic system than socialism and capitalism?
Capitalism is a particular kind of system that evolved in Europe. Europe wasn't capitalist in Middle Ages and neither it was socialist.
There is state-coordinated system which one may call capitalism in practice. Even it the 19C heyday of free enterprise, there was always a good deal of coordination with the state, Eg railways.
I strongly disagree that means tested welfare is better then universal welfare.
Let us compare two states:
1) A Scandinavian social insurance state where there are a lot of transfer payments, but they are mostly from the middle class to the middle class and basically smooth lifetime income without changing it much.
2) A machine politics welfare state where the total amount of transfers is a bit lower, but the middle class is looted and given nothing in return while there an indolent welfare class gets a bunch of free stuff paid for by others.
#2 would have less total "transfers", but they would more meaningfully be transfers. One group pays and gets nothing in return. The other group receives and pays little in return.
#1 would have more total "transfers", but would mostly just be people paying taxes to themselves and ending up in the same overall position
I was annoyed with Bruenig arguing that because one didn't make the natural resources, one can't fully own products made with such resources.
It's true that if I publish a book, I didn't create the wood that went into the paper. But I also didn't really profit from the sale of the wood. The customer ultimately gets the wood for basically free - what they are paying for is all the human labour that went into converting a tree into an entertaining book.
The bottom line is that welfare statism (and in particular Social Security and Medicare) both *deters* and *consumes* thrift at the expense of productive investments. Supply side freedoms are necessary, but not sufficient, to make capitalist production work--one needs the on-going creation of capital goods too.
The empirical record over the past sixty years is absolutely clear about this (see for example: https://cdn.mises.org/inline-images/image_271.png )--the welfare state has been growing at the expense of net savings, the latter marked by declines in both the share of national income devoted to private net savings and by the savings share remaining after government deficits have been subtracted.
Private thrift (i.e. voluntary restraint of present consumption) is essential because capital formation requires factor inputs (labor & natural resources) be diverted from the present formation of final consumption goods. While a more capital-intensive structure of production can ultimately achieve greater factor productivity and higher quantities of consumer goods produced, it takes *time* to realize this increase in the quantity outputs. The time required to transform inputs into outputs is itself a factor of production, so luring people into not saving with promises of free stuff or squandering their savings on purchases of government bonds creates shortages of time and reduces the productivity and incomes of labor, etc.
Goosing credit markets with monetary stimulus is not a substitute for thrift; while it provides the demand-side financing of investments (and of government deficits), it doesn't furnish additional factor inputs on the supply-side. The result is capital-wasting boom/bust cycles and in the long-run higher prices for capital goods, not increased supplies of capital goods over the long run.
If you lose $X and then you are given $X back, how is that wasteful? Unless the administrative costs of doing it are high. But that doesn't seem to be your argument against universal benefits.
Curiously, the libertarian writers do not offer adequate definition of property themselves. Sometimes, they write as if initial acquisitions of property were mostly unjust but it does not matter now. But even this statement presumes a concept of just acquisition and thus an implicit definition of property. But there is a reluctance to make it explicit.
Perhaps, the topic does not interest them or perhaps they fear that the definition of property would necessarily involve society in some form or other and lead them to conclusions not very friendly to libertarianism.
For instance, a problem posed by Milton Friedman -- how much does a property property extend in air above land? There is no way to answer this except by a decision of the society.
Most of us subscribe to Lockean theories, but trying to define property rights isn't fully necessary.
There is a near universal intuition that property rights exist, whatever the reason is for that. Bruenig also believes in property rights, since he would reject my ability to take his money as I please.
Your point 3. at the top of this article sounds like a simple restatement of Alchian & Demsetz' property rights economics paradigm, aka the UCLA School of Economics approach to economic analysis and reasoning.
"On a core emotional level, the left is anti-market."
I don't think this characterisation is fair for Bruenig, he gave practical and philosophical reasons for disliking aspects of markets and conceded market orientated supply side solutions could work in some situations. Someone who was emotionally opposed to markets wouldn't have conceded that.
If he's more concerned about redistribution than over-regulation it just shows that he views one as a more serious problem than the other, not that he rejects market-solutions on principle, which he explicitly didn't.
It it actually true that means tested benefits are cheaper than universal ones?
Means testing itself it expensive. People have to evaluate claims, and there will inevitably be fraud, and this all requires bureaucracy which will be self-interested and a target for corruption in its own right. And then the means test itself deters some of the people you want to help because completing it has a cost to them too. And the more precisely you try to target benefits, the larger these costs become.
If you contrast that with UBI, the implementation of UBI in the ideal case is just a program to submit a bunch of bank transactions. The amount of money being moved is much larger, but moving money in and of itself isn't expensive, and much of the money is being given straight back to the people who paid it in taxes, and you can encourage people to remove themselves from the actual payment system and claim a tax credit instead, which alleviates any concern about borrowing costs.
I’ve always found the dispute regarding the moral justification of property to be largely a distraction. Even if it turns out that we aren’t really sure what the most plausible justification for private property is, we don’t even have a good definition of private property as of now. There are more and more opportunities to obtain wealth without productive property in the traditional sense. Secondly, private property is a solution to a coordination problem that generally enables mutual benefits. It’s a stable solution such that disrupting would do more harm than good. So even if we lack a moral justification, we still have a normative concern to maintain institutions that maintain and even enhance mutual cooperation.
"It's a stable solution such that disrupting would do more harm than good."
That's your moral justification, as long as you are a utilitarian.
No that’s not utilitarianism. Nothing I said here implies utilitarianism. The badness of harm is widely agreed upon by every moral theory. Consequences matter to every moral theory. The difference is that utilitarianism says *only* consequences matter, but nothing I said above commits me to that.
I didn't say you were utilitarian. I said as long as you are a utilitarian, that's your moral justification, nothing else is needed. A utilitarian does not lack moral justification for private property.
1. "Without the welfare state, resistance to immigration would be markedly lower, so immigration would be markedly higher." This neglects to mention that without the welfare state inducements, immigration would be lower. This neglect happens so often in pro-immigration discussions that one begins to suspect it is an inconvenient truth.
2. The idea that property either does not exist or is immoral and should be strictly limited by government is an argument for slavery. If I make chairs for a living at 10 hours per chair, there is no practical difference between someone stealing a chair I had already made (theft) and someone threatening to shoot my family unless I make a new chair (slavery). Theft is slavery after the fact, and slavery is theft before the fact. They are one and the same. When the government denies property exists as a concept, or authorizes stealing "excess" property, it has enabled enslaving me.
The supply of immigrants would reduce sure. In other words, the amount of people wanting to immigrate would be smaller. But given that immigration is heavily restricted, if you both reduce the supply but also relax the constraints, it's not obvious what would happen. Intuitively for me the constraints are much more significant than the welfare incentives.
I look back at the pre-WW I immigration as the best available guide to immigration without government restrictions or inducements (ignoring criminal and health restrictions and familial and charity inducements). There’s no way to prove anything, which makes most arguments about it pure speculation. Pre-WW I immigration was the closest we’ve ever had, but now cheap and safe air travel make return visits possible, and the internet and cell phones allow instant communications. That makes immigration a lot easier and risk-free, especially compared to pre-1850 sea travel without steamships.
The hypothesis of welfare state as migration magnet is very weakly supported in the existing research. What matters more is the employment opportunity & the network (e.g. same ethnic groups) in the host nations.
The magnitude may be in dispute, but not the sign. No one ever refused to immigrate because of welfare.
This notion that people are not entitled to their endowments also needs to be debunked. To the extent that a person has good genetics, a good upbringing, or monetary support from their family, they deserve these things in the same way they deserve any other gift. We respect their claim on these gifts because we respect the property rights of the gift givers to do the giving.
I also find it funny how most of the "you didn't build that" crowd would balk at the suggestion that a family should be able to force their children to provide 30% of lifetime income as compensation for benefits provided but don't bat an eye when the government makes the same demand for the same reasons.
One does not "deserve" any gift. Thus, there is no sense in being "entitled" to one's endowment. One simply possesses the endowment.
A small handful of thoughts.
1. "Bruenig grants that socialism is a continuum. Which allows me to ask, iIf full socialism is at one end of the continuum, what’s at the other end?' The obvious answer is something like “laissez-faire capitalism,"
Not necessarily. This pedantic and maybe semantic, but the question is whether Bruenig said socialism is *on* a continuum or *is* a continuum. If it *is* a continuum, then laissez faire doesn't necessarily have any place on it. I don't think that's good framing of the real political-economic world, but it's way a socialist could think.
2. “taxing everyone to help everyone.”
Socialists have a profound analytical problem with this, and if any have really dealt with it, I haven't seen it. It's worth spelling out clearly. 1. Somebody has to handle the transfer process, and they have to be paid. This may be minimized by a negative income tax, but it doesn't disappear. So there is necessarily a net loss in the process (unless we consider paying someone merely to handle transfers a productive task). 2. So the argument must be that the net good done for the recipients of the transfer outweigh the deadweight cost, whether we measure that in increased productivity from the spending of the recipient (dubious) or in ethical terms (harder to measure either way). But the more that transfers become between people of the same economic class, the more impossible it becomes to say they do either economic or ethical good. 3. So the possibility for the transfers to have either economic or ethical net value must be for the transfers to go just from the well off to the not-well off. And while socialists will state this as their goal, they nonetheless fall into the trap of supporting within-class transfers. And they implicitly - although I don't think they ever are open about this - must assume that somehow the within-class transfer passing through the hands of the government officials handling the process actually gains in value. They seem to implicitly believe that there is some purely government addition in value - whether they think money can come purely from the government or through some other magic.
3. "on the morality of property itself"
I think this is an easier issue than most people - including property defenders - realize. Simply, all societies have had some degree of private property. The anthropological literature makes this clear. It's not always a full regime of possession that we westerners are accustomed to, but there are no fully communist societies in the literature - there is always some degree of "this is mine; that is yours," and at an absolute minimum guarantees right of first use claim (if I am not using my fishing boat today, then, and only then, may you use it without explicit permission). So, simply put, property rights are natural, and they arise simply through social agreement to respect others' claims to resources, within whatever bounds that society has developed from the ground up, through what we might call Ostromian spontaneous evolved order. It cannot be inherently unjust to have property, then, even if we argue that there are some conceivable property claims that would be unjust.
4. "no one deserves his place in the distribution of native endowments, any more than one deserves one’s initial starting place in society."
I think this is true, but it does not follow that any human devised and operated system can make initial distributions or starting places *more* just. We have to remember that just because an abstract proposal seems plausible, does not mean that we understand its actual full effects or that there is any real prospect that it will become the actual system devised and evolved over time (the product of human action, not design) will achieve that ideal.
If socialism *is* a continuum, then one end is less socialist than the other, and you must be able to define a variety of socialism at the very least socialist end. Then imagine its immediate neighbor across the line which you call the limit to socialism. What separates the two? What do you call the non-socialist economy that is just one teensy tiny bit separated from the least socialist economy, if not capitalist? Or do you posit some other economic system than socialism and capitalism?
Capitalism is a particular kind of system that evolved in Europe. Europe wasn't capitalist in Middle Ages and neither it was socialist.
There is state-coordinated system which one may call capitalism in practice. Even it the 19C heyday of free enterprise, there was always a good deal of coordination with the state, Eg railways.
I think Bruenig has criticized Bryan's support of the Success Sequence. Has Bryan replied anywhere?
I strongly disagree that means tested welfare is better then universal welfare.
Let us compare two states:
1) A Scandinavian social insurance state where there are a lot of transfer payments, but they are mostly from the middle class to the middle class and basically smooth lifetime income without changing it much.
2) A machine politics welfare state where the total amount of transfers is a bit lower, but the middle class is looted and given nothing in return while there an indolent welfare class gets a bunch of free stuff paid for by others.
#2 would have less total "transfers", but they would more meaningfully be transfers. One group pays and gets nothing in return. The other group receives and pays little in return.
#1 would have more total "transfers", but would mostly just be people paying taxes to themselves and ending up in the same overall position
I was annoyed with Bruenig arguing that because one didn't make the natural resources, one can't fully own products made with such resources.
It's true that if I publish a book, I didn't create the wood that went into the paper. But I also didn't really profit from the sale of the wood. The customer ultimately gets the wood for basically free - what they are paying for is all the human labour that went into converting a tree into an entertaining book.
The bottom line is that welfare statism (and in particular Social Security and Medicare) both *deters* and *consumes* thrift at the expense of productive investments. Supply side freedoms are necessary, but not sufficient, to make capitalist production work--one needs the on-going creation of capital goods too.
The empirical record over the past sixty years is absolutely clear about this (see for example: https://cdn.mises.org/inline-images/image_271.png )--the welfare state has been growing at the expense of net savings, the latter marked by declines in both the share of national income devoted to private net savings and by the savings share remaining after government deficits have been subtracted.
Private thrift (i.e. voluntary restraint of present consumption) is essential because capital formation requires factor inputs (labor & natural resources) be diverted from the present formation of final consumption goods. While a more capital-intensive structure of production can ultimately achieve greater factor productivity and higher quantities of consumer goods produced, it takes *time* to realize this increase in the quantity outputs. The time required to transform inputs into outputs is itself a factor of production, so luring people into not saving with promises of free stuff or squandering their savings on purchases of government bonds creates shortages of time and reduces the productivity and incomes of labor, etc.
Goosing credit markets with monetary stimulus is not a substitute for thrift; while it provides the demand-side financing of investments (and of government deficits), it doesn't furnish additional factor inputs on the supply-side. The result is capital-wasting boom/bust cycles and in the long-run higher prices for capital goods, not increased supplies of capital goods over the long run.
If you lose $X and then you are given $X back, how is that wasteful? Unless the administrative costs of doing it are high. But that doesn't seem to be your argument against universal benefits.
7 angels on the head of a pin. Not one more or less!
Curiously, the libertarian writers do not offer adequate definition of property themselves. Sometimes, they write as if initial acquisitions of property were mostly unjust but it does not matter now. But even this statement presumes a concept of just acquisition and thus an implicit definition of property. But there is a reluctance to make it explicit.
Perhaps, the topic does not interest them or perhaps they fear that the definition of property would necessarily involve society in some form or other and lead them to conclusions not very friendly to libertarianism.
For instance, a problem posed by Milton Friedman -- how much does a property property extend in air above land? There is no way to answer this except by a decision of the society.
Most of us subscribe to Lockean theories, but trying to define property rights isn't fully necessary.
There is a near universal intuition that property rights exist, whatever the reason is for that. Bruenig also believes in property rights, since he would reject my ability to take his money as I please.
This is incredible progress from what libertarian-left debates commonly looked like 10 years ago.
Your point 3. at the top of this article sounds like a simple restatement of Alchian & Demsetz' property rights economics paradigm, aka the UCLA School of Economics approach to economic analysis and reasoning.
I thought Bruenig was a woman. THAT is how lost I am in all this.
I apologize (to the rest of you).
Matt Bruenig and Elizabeth Bruenig are married and are both public figures, and she seems to be more famous, so that's why your mind though of her.
Thanks! I (male) still prefer her.