Matt Zwolinski writes that “a Basic Income Guarantee would be much better than the current welfare state.”
Now in the first place, this argument would be instantly condemned by Rothbard who understands libertarian strategy this way:
The transitional demands, then, must be framed while
(a) always holding up the ultimate goal of liberty as the desired end of the transitional process; and
(b) never taking steps, or using means, which explicitly or implicitly contradict that goal. …
For example, libertarians may well push for drastic reduction, or repeal, of the income tax; but they should never do so while at the same time advocating its replacement by a sales or other form of tax.
The reduction or, better, the abolition of a tax is always a non-contradictory reduction of State power and a step toward liberty; but its replacement by a new or increased tax elsewhere does just the opposite, for it signifies a new and additional imposition of the State on some other front.
The imposition of a new tax is a means that contradicts the libertarian goal itself. (EoL, 262)
If Rothbard is making sense, then Zwolinski’s argument fails on its own strategic grounds.
Further, we need to realize that the welfare system by reason of its own Byzantine structure deters people from getting on welfare. It is arguable that the vast and difficult-to-navigate bureaucracy exists for precisely this reason.
For the easier and less costly the looting process is, the more will be looted. It is true that the money that goes to the bureaucrats now might go to the poor, but the total cost of the system need not decline by much and may even increase, depending on the elasticity of demand for welfare.
Zwolinski argues against both the “conservative judgment and progressive condescension” toward the poor:
Conservatives want to help the poor, but only if they can demonstrate that they deserve it by jumping through a series of hoops meant to demonstrate their willingness to work, to stay off drugs, and preferably to settle down into a nice, stable, bourgeois family life.
And while progressives generally reject this attempt to impose traditional values on the poor, they have almost always preferred in-kind grants to cash precisely as a way of making sure the poor get the help they “really” need.
Shouldn’t we trust poor people to know what they need better than the federal government?
No, we should not! Suppose Jones, having been touched by Smith’s plight, gives Smith some money expecting that Smith will buy food with it. Instead, Smith goes to the nearest casino and gambles the gift away. Is Zwolinski serious in asking Jones not to be upset over this?
The general principle upon which charitable giving is based will be further discussed below.
Zwolinski’s second argument proceeds as follows:
In a world in which all property was acquired by peaceful processes of labor-mixing and voluntary trade, a tax-funded Basic Income Guarantee might plausibly be held to violate libertarian rights.
But our world is not that world.
And since we do not have the information that would be necessary to engage in a precise rectification of past injustices, and since simply ignoring those injustices seems unfair, perhaps something like a Basic Income Guarantee can be justified as an approximate rectification?
My first rejoinder is to point out that Zwolinski’s justice is a variant of the collectivist “loot the looters” principle. Contrast it with the careful discrimination by Rothbard:
… for any property currently claimed and used:
(a) if we know clearly that there was no criminal origin to its current title, then obviously the current title is legitimate, just and valid;
(b) if we don’t know whether the current title had any criminal origins, but can’t find out either way, then the hypothetically “unowned” property reverts instantaneously and justly to its current possessor;
(c) if we do know that the title is originally criminal, but can’t find the victim or his heirs, then
(c1) if the current title-holder was not the criminal aggressor against the property, then it reverts to him justly as the first owner of a hypothetically unowned property. But
(c2) if the current titleholder is himself the criminal or one of the criminals who stole the property, then clearly he is properly to be deprived of it, and it then reverts to the first man who takes it out of its unowned state and appropriates it for his use. And finally,
(d) if the current title is the result of crime, and the victim or his heirs can be found, then the title properly reverts immediately to the latter, without compensation to the criminal or to the other holders of the unjust title. (EoL, 58)
… as in all cases of alleged theft or other crime, every defendant is innocent until proven guilty. (124)
A recent popular article by Robert Higgs noted that it’s not the “1%” that the left should inveigh against, for the vast majority of these super-rich, quite despite our interventionist economy, obtained their wealth lawfully, that is, without government subsidies or bailouts and by providing genuine service to the consumers. It’s only perhaps 0.1% of the richest folks, Higgs concludes, who are sucking the government’s tit and can be condemned from both the leftist and the libertarian point of view. But Zwolinski would have us loot the 90% of these super-rich who are entirely innocent.
Further, Zwolinski seems to imply is that the present poor are poor because of past injustices rather than their own failures in the specific sense of this term; as Mises points out:
… so far as the operation of the market is not sabotaged by the interference of governments and other factors of coercion, success in business is the proof of services rendered to the consumers.
The poor man need not be inferior to the prosperous businessman in other regards; he may sometimes be outstanding in scientific, literary, and artistic achievements or in civic leadership. But in the social system of production he is inferior.
The creative genius may be right in his disdain for commercial success; it may be true that he would have been prosperous in business if he had not preferred other things.
But the clerks and workers who boast of their moral superiority deceive themselves and find consolation in this self-deception. They do not admit that they have been tried and found wanting by their fellow citizens, the consumers. (HA, 314)
Mises goes on:
Private property is a human device. It is not sacred. It came into existence in early ages of history, when people with their own power and by their own authority appropriated to themselves what had previously not been anybody’s property.
Again and again proprietors were robbed of their property by expropriation. The history of private property can be traced back to a point at which it originated out of acts which were certainly not legal.
Virtually every owner is the direct or indirect legal successor of people who acquired ownership either by arbitrary appropriation of ownerless things or by violent spoliation of their predecessor.
However, the fact that legal formalism can trace back every title either to arbitrary appropriation or to violent expropriation has no significance whatever for the conditions of a market society. Ownership in the market economy is no longer linked up with the remote origin of private property.
Those events in a far-distant past, hidden in the darkness of primitive mankind’s history, are no longer of any concern for our day.
For in an unhampered market society the consumers daily decide anew who should own and how much he should own. The consumers allot control of the means of production to those who know how to use them best for the satisfaction of the most urgent wants of the consumers.
Only in a legal and formalistic sense can the owners be considered the successors of appropriators and expropriators. In fact, they are mandataries of the consumers, bound by the operation of the market to serve the consumers best.
Under capitalism, private property is the consummation of the self-determination of the consumers. (683)
We live in America in a more-or-less free market economy and have been for hundreds of years. To ascribe the failure of the presently poor to oppression may serve to relieve the guilty individuals of responsibility, but as Michael Levin argues, “the flip side of [indiscriminate] absolution for vice is disrespect for virtue.” The presently successful must then be such because they are the oppressors. Combine this ideology with Zwolinski’s collective guilt, and you have a particularly vicious form of craving for socialism.
In general, socialism for the rich cannot be cured with socialism for the poor.
Alright, let’s move on to Zwolinski’s third argument. He asks, “Could there be a libertarian case for the basic income not as a compromise but as an ideal?” And answers by giving two quotes of Milton Friedman and Hayek.
Now first, let’s get clear on the problem of poverty. As Mises has argued,
We may depict conditions of a society of agriculturists in which every member tills a piece of land large enough to provide himself and his family with the indispensable necessities of life. …
The inherent weakness of such a society is that the increase in population must result in progressive poverty.
If the estate of a deceased farmer is divided among his children, the holdings finally become so small that they can no longer provide sufficient sustenance for a family. Everybody is a landowner, but everybody is extremely poor. Conditions as they prevailed in large areas of China provide a sad illustration of the misery of the tillers of small parcels.
The alternative to this outcome is the emergence of a huge mass of landless proletarians. Then a wide gap separates the disinherited paupers from the fortunate farmers.
They are a class of pariahs whose very existence presents society with an insoluble problem. They search in vain for a livelihood. Society has no use for them. They are destitute.
When in the ages preceding the rise of modern capitalism statesmen, philosophers, and lawyers referred to the poor and to the problems of poverty, they meant these supernumerary wretches.
Laissez faire and its off-shoot, industrialism, converted the employable poor into wage earners. In the unhampered market society there are people with higher and people with lower incomes. There are no longer men, who, although able and ready to work, cannot find regular jobs because there is no room left for them in the social system of production.
So, we are clear that the “poor” today include only two sorts of people: (1) those who through no fault of their own in are imminent danger to their lives; and (2) permanently disabled.
Regarding (1), there is indeed a duty of society to rescue people. For example, there ought to be an organization charged with rescuing mariners in peril on the seas. As for the poor, this duty takes the form of not letting the poor literally starve to death. The market produces pleasure, but dead people cannot pursue their happiness. Survival is prior to enjoyment of life, and I agree that we all have a duty to ensure that no one starves. But so insignificant is this problem that private charity can surely handle it. Beyond that, once their survival is assured, the poor are on their own, just like everybody else. The fact that the poor cannot afford nice things does not mean that other people are obligated to remedy that.
Let me further disagree with David Friedman that there is any public goods problem associated with charity. It is not a goal of the Friedman’s bureaucrat-god to help all the deserving poor. People help the poor out of love for them; the givers, too, benefit, as the receivers’ happiness overflows into them, as they themselves feel to an extent the receivers’ joy at the gift given. Regarding this goal, every dollar given helps. Charity is a consumer good for the givers, so whatever is given is the “right” amount.
And this argument takes care of case (2).
The Hayek’s quote in particular seems to me destructive of the family and local community ties, things the left has always hated as intermediate institutions commanding people’s devotions as opposed to the state or “great society,” whatever that means.
It also looks as though Basic Income Guarantee equalizes the moral status of parasitic life with that of productive life. A person is “guaranteed” to receive money for doing no work. This is repugnant to natural law which states that one must either provide for himself (or indeed, starve) or have a person who loves him provide for him, such as parents for their children.
Finally, Zwolinski should consider the disincentive effects not only on the receivers of welfare but also on the taxpayers.
In sum, Basic Income Guarantee is both an uneconomic and unjust policy.
To forestall an objection, the point of the long quotes in this post is to instruct everyone that full-featured and devastating arguments against Zwolinski’s position are found in the major classics. There is no need to reinvent the wheel, and Zwolinski needs to go back to the drawing board, if even canonical works refute him so effectively.