Tuesday, April 19, 2011

What Is Fair? An Examination Of Equality

A lot of rhetoric is being spewed about fiscal responsibility right now, from all sides (though few are actually being genuinely serious about acting on it).  It seems to me that one of the base questions that needs to be discussed is that of what constitutes 'equality' in a capitalist society.  Those on the Left would say that what really counts is equality of outcomes, meaning that everyone should be equally successful and wealthy.  Those on the Right would say that what really counts is equality of opportunity, meaning that everyone should have the same opportunities to make their own success and wealth.  The resulting difference is that we can see the overall wealth of the entire nation (all economic levels) go up across the board, but the Left will still think things are 'unfair', and continue to push for economic policies that are punitive to the top producers and the most successful people in the nation.  How?  Well, this small but crucial distinction between equality of opportunity versus equality of outcomes is something that the Heritage Foundation tackles yet again in an ongoing discussion.  Check out the whole give-and-take for an interesting debate on a broader topic, but the key point I want to pull out is this:

The left sees inequality itself as a problem. This is because equality is one of the left's highest values. The right values equality, too, but in a different sense. The left values equality in the sense of equal outcomes. The right values equality in the sense of equal opportunity. The conflict arises because equality of opportunity is incompatible with equality of outcome.

In response to Mr. Mitchell's point, let's assume for a moment that we're in an economy where the top 1 percent takes home $0.99 of every dollar (We're nowhere near that today), but everyone is still gaining. How could this be, some may ask?

If there are more dollars in the economy, everyone will gain. For example, if we had an economy that produced $100 trillion per year, instead of our current $14 trillion per year, there would be many more dollars from which everybody could take a slice. So, even though the slices of each dollar would be unequal, everyone would be taking more total slices, resulting in gains for all.

As a hypothetical, think about it like this: Would it be better to take 40 cents of every dollar in a $10 trillion economy, or to take 20 cents of every dollar in a $30 trillion economy? Alternately, assume in 1980 that the poor made $1 and the rich made $100. Assume that in 2010 the poor made $3 and the rich made $300. In this scenario, inequality has increased, but the poor have tripled their earnings. Would anyone argue that the poor aren't any better off?

Furthermore, purchasing power would continue to increase – every dollar would buy more goods and services – as I highlighted in my original post.

So how one frames this debate comes down to one's worldview: Is equality (of outcome) a goal in and of itself? If not, then why does it matter that some have gained more than others?


If all income groups have gained since 1979 – some groups by 33 percent, others by 333 percent – why does inequality matter? The answer may well depend on whether one more strongly values equality of outcome or equality of opportunity. But the statistics are clear: No matter how one slices it, all income groups have gained over the past few decades.

And yet, the Left is screaming louder than ever about the lack of 'fairness'.

In my opinion, this is one of the most fundamental differences between the Left and the Right, and a constant source of tension in terms of policies.  Think about it - the Left is constantly pushing for 'fairness' based on outcomes.  They want the poor to have more money simply because it's not fair that they're poor; the only way to equalize the situation, then, is to take money from the rich and give it to the poor.  Socialism.  The Left engineers policies toward this end all the time - just look at our tax code.  How is it fair that the most successful and the most productive members of American society are required to pay vastly higher taxes (percentage-wise) than those of lesser levels of success?  No, it's not.  It's precisely the opposite.

Similarly, reality has shown over and over that those who get a free lunch eventually demand a free lunch consisting of an all-you-can-eat buffet, alcoholic beverages, dessert, and a room to stay in afterward.  When there is no incentive to get out there, get a job, produce, and succeed...people don't.  That's why welfare is a double-edged sword.  Don't get me wrong, there's nothing inherently wrong with temporary assistance - sometimes it's necessary, and most everyone needs help from time to time.  But...that should be a VERY temporary thing, and only when genuine effort is demonstrated to get back off the assistance rolls.  That's not what we have today, however.  When people stay on welfare for 99 weeks (yes, almost two years...that's the current duration of welfare assistance), you tell me: is there really any incentive to get a job?  No.  So, unproductive people sit there, sucking resources out of those who are productive, and demanding more and more.  You can call me cold-hearted and calloused if you want, but this is the reality.  I will ask you: what's fair about simply taking money from hard-working people and giving it to people who are perfectly capable of being a productive member of society but who simply choose to be lazy instead?  Fairness??  I think not.

Unfortunately, if you play things out to their end conclusion, this is one of those game-over issues.  Don't believe me?  Look at this example from a recent Gallup poll:

Half of Americans believe the amount they pay in federal income taxes is too high, while 43% consider it about right and 4% too low.

Now, match that polling result with data from 2009 tax returns, and just take a wild stab in the dark at what percentage doesn't actually pay any federal income taxes at all.  Got a guess?  Yep: 46.9%

Shocker of a coincidence, huh?

The danger, then, is when that 46.9% crests the 50% mark and those not paying any income tax at all suddenly become the majority.  At that point, there's literally nothing stopping the majority of non-producers from simply voting themselves more goodies from the minority of producers...until there's nothing left.  This is the danger.  The Founders knew it, and did everything they could to ensure it wouldn't happen.  Their ideas have held back the tide of socialism and the Left's notions of 'fairness' -- equality of outcomes rather than equality of opportunities -- for almost 250 years, but we are rapidly approaching the tipping point at which the country begins an inevitable and unrecoverable decline.  It's up to us here and now, TODAY, to make sure this doesn't happen.  If we don't, our children and grandchildren will never experience the freedom and prosperity that has blessed us to this point in American history.

I leave you with the words of Thomas Jefferson in 1816:

"To take from one, because it is thought his own industry and that of his fathers has acquired too much, in order to spare to others, who, or whose fathers, have not exercised equal industry and skill, is to violate arbitrarily the first principle of association, the guarantee to everyone the free exercise of his industry and the fruits acquired by it."

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