Thursday, 20 November 2014

Why Re-distribution of Wealth is Immoral

(From the archives: August 19th, 2003)

All governments today re-distribute some people's money to others. Or, as it is more commonly known, re-distribute wealth. No matter whether of the political right or left, they all take lots of our earned money away from us productive people – far, far more than the dubious services they provide are worth to us.

How they spend the product of their pillage does, indeed, vary from one place to another. Some like to pour money into grandiose social schemes like the British NHS, that consume vast amounts of resources without ever properly delivering the services they are supposed to provide. Others prefer to create and expand huge bureaucracies to enforce ever more onerous regulations, and to collect heavy fines and penalties from those who disobey them. Increasingly, though, governments are learning from each other, and doing both.

This forced re-distribution of our earned money must have some moral basis. Mustn't it? It would be interesting, I thought, to look at some of the ideas, which are brought up as supposed justifications for re-distributory taxation.

I will begin with "the brotherhood of Man.” (And sisterhood, too). This idea is a very old one, going back at least to the Stoics. We human beings are supposed to be, in a sense, one vast family. And it is incumbent upon us to behave towards each other in a sprit of brotherhood.

I myself am a strong supporter of the brotherhood-of-Man ideal. But I add an important rider: Brotherhood is a two-way process.

This shows up in the moral concept I call negative brotherhood. If you don't commit acts that harm me, I won't commit acts that harm you. A well-known formulation of negative brotherhood is Confucius' Golden Rule: Don't do to others what you wouldn't like to have done to yourself.

There is a positive side to brotherhood as well. By our actions, we can make ourselves valuable to others. And they, in turn, can make themselves valuable to us. Different people are good at different things, and different people desire different things. Hence this process of positive brotherhood – in other words, trade – can greatly improve life for everyone.

The brotherhood of Man, then, does indeed provide a good moral basis for a society. But such a society will not re-distribute money or wealth. For re-distribution is not a two-way, brotherly exchange, but a one-way drain on those who suffer it. Indeed, a society genuinely based on the brotherhood of Man will have two characteristics, which we lovers of freedom admire. One, the rule of law, to underpin negative brotherhood. Two, no restraints on positive brotherhood. In other words, free trade in a free market.

Next comes the idea that the strong should support the weak. For this idea to justify re-distribution, it must be taken in the enforceable sense. That is to say, not only do the strong have a moral obligation to help the weak, but this obligation is sufficiently powerful that it is morally OK for others to force them to do so.

This principle, if applied only to economics, might appear to justify re-distribution of money from the rich to the poor. But, if this principle that the strong can be forced to support the weak is generally valid, it should apply in other areas of life as well. For example, the socially strong – those who find it easy to make friendships and relationships – should be forced to help the socially weak, those who find these things difficult. There is no evidence of this happening. And the politically strong, those in power, would be required to support the politically weak, the powerless and unrepresented. But this is not what actually happens. Indeed, re-distribution of money by governments, being oppression of the politically weak by the politically strong, is a direct contradiction to the principle.

There remains, however, the possibility that the strong have a moral obligation to support the weak, but not one so powerful that anyone has a right to compel it. This is, indeed, the ideal of charity. But several conditions must be added. For charity to be possible, the helpers must have an idea of who it is they are helping. If possible, there must be personal contact between helpers and helped. The helped owe the helpers, at the very least, thanks and appreciation in return. And, if there is something more tangible that they could do to help those who help them, they should offer what they can give. But today's systems of re-distribution of wealth meet none of these conditions. They are not in any way charitable.

On to the third candidate. This is the idea that those who are in need have a prior claim on us. That we have an obligation to do what is necessary to get their needs satisfied. And, by implication, that they have a corresponding obligation to help us when we are in need.

This candidate seems more promising. But there are still questions. First, what does "in need" mean? To answer this, we need to ask, what are human needs? I will give my own list, but will try not to depart too far from the conventional view.

First, there are physical needs, such as food, air, water, sleep, shelter, health, sex. Second, psychological needs, including privacy, security, dignity and the freedom to use your own common sense. Third, social needs, for example appreciation and recognition, sense of community, trust, love and sense of justice. Fourth, personal development needs, such as challenge, achievement and growth, leading towards fulfilment of your human potential.

The question now arises, which of these needs are so important that they justify forcing others to satisfy them? Plainly, some can't be that important. Governments do not, for example, force people to provide sex lives for those who can't get them for themselves. And rightly so. To force people to prostitute themselves would be an abomination, a denial of all respect for human beings.

So, helping the needy in the wide sense cannot be the justification we are looking for. Perhaps, then, it is only those in economic need who have a claim on us? Perhaps it does not matter if some people are denied satisfaction of needs such as freedom, justice, community, appreciation, love (and sex), as long as the economically poor are helped?

But this idea, that the economically poor have a claim on others overriding the satisfaction of those others' own needs, has a practical flaw. For, if those that purport to take this view genuinely believed it, they would order their own lives, and devote their own energies, for the benefit of the poor. They would try to emulate, for example, what Mother Teresa did in India, or what Quintin Hogg did in London in the 19th century. Do they? Not.

There is another question to be asked, too. Why is it, that people are – or become – poor? There are many reasons, but they all fall into one of three classes. First, things which are their own fault. Second, things which are no-one's fault. Third, things which are someone else's fault.

If individuals' poverty is due to their own fault – for example, if they are persistently too lazy or too dishonest to earn a living in a free market – then the question must be asked, why should we worry? If they won't behave as our brothers, why should we care about them? Their welfare certainly should not be at the top of our priority list. And what if, on top of these failings, they are surly, bigoted, disruptive, violent, or criminal? Or if they promote or support political policies that harm or inconvenience us? We would be better off if they starved to death – and not only financially.

Failure to earn, which is due to no-one's fault, is a completely different matter. Accident, illness, unemployment or disability can hit anyone. But it is easy to conceive of mechanisms to help people in these situations, which do not require any re-distribution. Historically, the extended family has provided one solution. Mutual aid societies have provided another. No-one should mind paying a reasonable insurance premium to ensure that they are not left destitute if they suffer an injury, or something else which stops them earning and is no-one's fault.

The third, and actually by far the commonest, case is that in which individuals' poverty, or failure to earn, is caused by someone else's fault. People may be exploited, for example by the violent or the fraudulent. Or there may be obstacles, such as bureaucratic permits and regulations, placed in the way of their earning a living through honest business and trade. Or politicians may make policies that depress the economy. In these cases, the perpetrators of the exploitations, obstructions or policies are the ones that ought to compensate the people who are impoverished by them. Re-distribution of the fairly earned wealth of innocent third parties is neither necessary nor right.

Our third candidate has failed. Approacheth the fourth. This is exemplified by the Old Labour election slogan from the 1970s, "Let's make the rich squeal.”

If there is any moral basis at all for soaking the rich, it must be that their gains were ill-gotten. If their riches were acquired through violence, or fraud or manipulation, or abuse of political power, for example, then clearly they are criminals, and due process of law gives us a right to take those riches away from them. If they inherited Daddy's millions, or won the Lottery, some of us may perhaps feel a little envious towards them. But no-one has any right to take anything away from them. If, on the other hand, their wealth was gained through their own efforts, through developing and using their talents and making themselves useful to others, they deserve to be congratulated and cherished, not robbed.

Besides which, re-distribution today does not hit just the rich. No-one can be considered rich, for example, who cannot see their way to a comfortable retirement. Yet today, saving for our own pensions, far from being made easier, is being made harder. To the extent that, unless there is radical change, most people aged under about 55 today are never going to get pensions sufficient to live on.

Our fifth and final candidate is St. Paul's dictum, "The love of money is the root of all evil.” Just a little consideration shows this is nonsense. There is nothing evil about wanting to be comfortably off. There is nothing evil about wanting to use your fairly-earned money to enjoy life, and to safeguard your own future and the future of those you care about.

Our five candidates have been and gone, and the vacancy is still not filled. There remains one possibility.

Could it be, perhaps, that there is no moral basis for re-distribution at all? Could it be that all the stuff about brotherhood, the strong helping the weak, the needs of the (sigh) needy, is no more than smoke-screen or rationalization? Could it be that the main reason those that favour re-distribution do so, is simply that they want to take away our wealth? (Recognizing, of course, that they may also have subsidiary reasons – for example, vote-buying, feathering their own nests and rewarding their henchpersons).

Could it be, as our fourth and fifth candidates seemed to suggest, that the driving force behind the re-distribution of our earned wealth is hatred – hatred of money, hatred of wealth itself, and hatred of those who earn it? Could the re-distribution of our wealth be, in essence, a kind of quasi-religious persecution?

This explanation seems to fit the facts. It explains why we never get any thanks or appreciation for all the money we are forced to pay. It explains why all the politicians' plans for institutions like the NHS are always the same; just throw lots more tax money into the pot. It explains the unreasoning hatred that many supporters of re-distribution show towards business, industry, and the free market. It explains why politicians like to make lots of tough new laws with harsh financial penalties attached to them. It explains, too, why more than half a century of welfare states hasn't solved the problem of poverty.

Once we accept this explanation, our attitude towards those responsible hardens. We see through their rationalizations to the huge fraud that lies behind them. We see that they are not our brothers. We see that they have, persistently and maliciously, failed to live up to one of the most ancient and important of all human moral rules: Thou shalt not steal.

Where do we go from here? Traditionally, the response to religious persecution has been to go somewhere else more tolerant. That is hard in this case. For practically every government in the world re-distributes wealth away from those who honestly earn it. We need a more radical solution.

Whatever the eventual solution, I think the first step is obvious. We need to help good, productive people understand how badly they have been hoodwinked. And we need to help them identify the culprits.

One final question. Just why is it, that so many of those that favour re-distribution of our wealth show such a fear of the free market? I offer for your consideration one possible answer. In a truly free market, they would be surplus to human requirements.

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