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Posts Tagged ‘Morality’

I don’t like coerced redistribution. When the government uses the threat of force to take from Person A to give to Person B, it simultaneously reduces Person A’s incentives to produce while also luring Person B into dependency.

But not all coerced redistribution and government intervention is created equal.

I don’t like welfare programs, for instance, in part because taxpayers are writing huge checks to support a plethora of programs, but also because there is very strong evidence that the modern welfare state has caused more poverty.

Nonetheless, I understand that there are well-meaning people who support these programs. Their motives are pure in that they simply want to alleviate perceived suffering. And since they’ve never learned about the adverse indirect effects of government intervention and presumably haven’t given any thought to the ethics of government coercion, I don’t think of these people as being bad or immoral. Just uninformed.

But there are some forms of redistribution and intervention that are so self-evidently odious and corrupt that you can’t give supporters the benefit of the doubt. Simply stated, there’s no justifiable argument for using government coercion to hurt poor people in order to benefit rich people.

Let’s look at two examples.

First, the Export-Import Bank is a quintessential example of corporate welfare. The program forces taxpayers to guarantee the contracts of big corporations and foreign buyers, and there’s now a fight over whether it should be extended.

Needless to say, ordinary voters don’t want their money being used enrich big companies.

So if you were one of the beltway insiders who benefited from this corrupt institution, how would you try to get the program extended? Would you be upfront and argue that big companies like Boeing deserve tax dollars? Would you argue that politicians are really smart and wise and that they should interfere with the free market?

That would be the honest way of supporting the Ex-Im Bank. But you won’t be surprised to learn that advocates instead have resorted to lies. Here are some excerpts from a Reuters story.

The U.S. Export-Import Bank has mischaracterized potentially hundreds of large companies and units of multinational conglomerates as small businesses, a flaw in its record keeping that could undermine the export lender’s survival strategy. …A comparison of some 6,000 businesses characterized by Ex-Im as “small” with information supplied by corporate data collector Dun & Bradstreet, which Ex-Im also uses to vet applicants, and other sources turns up some 200 companies that appear to be mislabeled and many more whose classification is uncertain.

Um… I would say they lied rather than characterize it as a “flaw in its record keeping.” But let’s set that aside and look at some of the “small businesses” that had their snouts in the Ex-Im trough.

…analysis showed companies owned by billionaires such as Warren Buffet and Mexico’s Carlos Slim, as well by Japanese and European conglomerates, were listed as small businesses and Ex-Im acknowledged errors in its data in response to those findings.  …A division of Austria’s Swarovski jewelers shows up, as does North Carolina’s Global Nuclear Fuels, which is owned by General Electric and Japan’s Toshiba and Hitachi. …The list of small businesses in Texas, for example, includes engineering and construction company Bechtel, which has 53,000 employees.

Gee, Warren Buffet and foreign conglomerates don’t exactly sound like my idea of small businesses.

Hopefully this will provide more ammunition of those fighting to wean big companies from the public teat.

Bank officials and supporters have used the Ex-Im’s support for American small business as a first line of defense against a campaign by conservatives to shut it down as an exponent of “crony capitalism.” …“Rarely does Ex-Im miss a (public relations) opportunity to claim that it primarily helps small business, but Ex-Im is again playing fast and loose with the facts,” said Representative Jeb Hensarling, a Texas Republican who chairs the House Financial Services Committee. “The bulk of Ex-Im’s help indisputably goes to large corporations that can finance their own operations without putting it on the taxpayer balance sheet.”

For our second example, we have the absolutely horrifying spectacle of the Obama Administration trying to shut down Wisconsin’s school choice system.

Why? Well, because currying favor with union bosses is more important than improving educational opportunities for students from disadvantaged communities.

George Will explains what’s happening in his Washington Post column.

It is as remarkable as it is repulsive… Eager to sacrifice low-income children to please teachers unions, the Justice Department wants to destroy Wisconsin’s school choice program. Feigning concern about access for disabled children, the department aims to handicap all disadvantaged children by denying their parents access to school choices of the sort affluent government lawyers enjoy. …Wisconsin’s school choice program was pioneered by an American hero, Mississippi-born Annette Polly Williams, who died Nov. 9 at age 77. During her three decades in Wisconsin’s legislature, she overcame the opposition of fellow Democrats to offering education choices to low-income parents. At the end of her life, however, she saw an African American attorney general, serving an African American president, employing tortured legal reasoning in an attempt to bankrupt private schools that enlarge the education options of disadvantaged children. …Closing the voucher program is the obvious objective of the teachers unions and hence of the Obama administration. Herding children from the choice schools back into government schools would swell the ranks of unionized teachers, whose union dues fund the Democratic Party as it professes devotion to “diversity” and the downtrodden.

By the way, you probably won’t be surprised (given the White House’s cavalier approach to the rule of law) to learn that the Obama Administration is using is utterly nonsensical legal theory.

…federal lawyers argue that because public funds, in the form of tuition vouchers empowering parents to make choices, flow to private schools, the schools become “public entities.” …this is like arguing that when food stamps are used for purchases at Wal-Mart, America’s largest private employer ceases to be private — it becomes an extension of the government. Inconveniently for the Justice Department, the U.S. Supreme Court has said the fact that a “private entity performs a function which serves the public does not make its acts state action.”

The preposterous legal reasoning is a farce, but that doesn’t get me overly upset.

What does bother me is the way the White House is acting like the modern-day equivalent of George Wallace, standing in the schoolhouse door to prevent low-income (and largely minority) students from getting an opportunity for better education.

I guess that a black President (who sends his own kids to private school) consigning black children to the back of the proverbial bus shouldn’t surprise me too much. After all, some divisions of the NAACP also have decided that being politically allied with union bosses is more important that educational opportunity for minority kids.

But that doesn’t make it morally acceptable. Put yourself in the shoes of a low-income parent. Wisconsin’s school choice programs gives you some hope that your kids can break free of poverty. Imagine what it feels like, then, when some of the politicians who claim to be on your side then decide that your children are expendable pawns. How disgusting.

Since we’re talking about things that are disgusting, let’s shift back to the Ex-Im Bank. I’ve actually had some Republican types tell me that corporate welfare is okay because it “helps to offset” some of the redistribution from rich to poor.

I confess that I’m dumbstruck by such arguments. It’s sort of like hearing someone say it’s okay to murder, rape, and steal because other people are doing it.

This is why it’s not easy being a libertarian. Yes, we believe in small government for utilitarian reasons such as faster growth, higher living standards, and more jobs. But we’re also motivated by morality, by the belief that there’s right and wrong and that good people should strive to uphold the former and fight the latter.

That’s not a popular view in Washington, which is best characterized as an incestuous racket for the benefit of interest groups, politicians, cronyists, lobbyists, bureaucrats, contractors, and other insiders.

P.S. On a completely separate (and non-political) issue, I can’t resist seeking some sympathy after what happened to me this morning. I took two of my cats to the vet for their spay and neuter appointments. Some of you pet owners already know that most cats don’t like car rides, so you might have some inkling of what I’m about to report.

In happier times

About five minutes into the drive, one of the cats vomits in the little cat carrier. That obviously wasn’t a happy development, particularly since it left me with an unpleasant choice of enduring a very unpleasant smell or having the window open and enduring a very bitter chill. But then, a few minutes later, the other cat…um, how should I phrase this…loses control of her bowels.

Which means that the next 20 minutes was almost as unbearable as watching a state-of-the-union address. I was running late for the appointment, so I couldn’t stop someplace and try to deal with the mess. And the two cats kept moving around in their carrier, making things worse. Trying to breathe through my mouth, even with the window down, was at best a pitiful attempt to mitigate my suffering.

An utterly miserable situation. Almost 1/10th as bad as an IRS audit.

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Normally this blog focuses on big issues such as the economic damage of government spending and the self-defeating foolishness of high tax rates.

Today, though, it’s time for another edition of “You Be the Judge.”

In this game, we look at stories and issues that require us to balance common sense, the principles of a free society, and justice.

Previous editions of this game include: Putting politicians on trial, vigilante justice, brutal tax collection tactics, child molestation, pay levels at government-owned firms, sharia law, healthcare, incest, speed traps, jury nullification, and vigilante justice (again).

Our latest example comes from Alaska, where someone with very questionable judgement was busted for floating down a river while consuming vast quantities of alcohol. Here’s some of the story from the Fairbanks Daily News.

A Juneau man faces a rare DUI charge for allegedly having a 0.313 breath-alcohol content as he floated through Fairbanks on an inflatable raft Sunday night. Alaska’s driving under the influence law applies to people operating motor vehicles, water craft and airplanes. …when Alaska State Troopers received a report of a “heavily intoxicated” man floating down the Chena River near the Parks Highway bridge at 6:40 p.m. Sunday, a wildlife trooper boat responded and arrested 32-year-old William Modene. …At 0.313, Modene’s breath-alcohol content was almost four times the legal limit for operating a vehicle, 0.08. …Under Alaska’s DUI law, operating a water craft means to “navigate a vessel used or capable of being used as a means of transportation on water for recreational or commercial purposes on all waters, fresh or salt, inland or coastal, inside the territorial limits or under the jurisdiction of the state.”

So here’s the issue we have to decide: Mr. Modene doesn’t sound like a model citizen, and he may be swimming in the shallow end of the gene pool, but the question on the table is whether the government should have arrested him for DUI?

From a legal perspective, is it accurate to say that he was “operating” a water craft or “navigating” a vessel?

I’m not an expert on such matters, but it seems to me that he was doing nothing more than floating down a river. There’s nothing in the story, for instance, to indicate he had a motor on his raft.

From what we know, Mr. Modene posed zero danger to other people. He was merely a drunk, minding his own business as he floated along.

My gut instinct is that this case should be tossed. The government would be in a much stronger position if it had charged him with “being drunk in public” or something like that. But even in that case, floating down a river may not meet the test of being “in public.”

There’s a separate issue, of course, about whether the government can and should intervene if someone is engaging in self-destructive behavior. If there’s a report that someone has just taken a bottle of sleeping pills, most of us presumably would agree that it would be okay for the government to break down his door and tote him to a hospital to have his stomach pumped.

But the self-destructive behavior has to pose an immediate danger. We’d hopefully all reject, for instance, the notion of some Bloomberg-esque ban on unhealthy food because people sometimes shorten their lives by overeating.

Since I probably average one beer a month, I’m not competent to make sweeping statements about alcohol, but it’s my understanding that a blood alcohol level of .4 is when people begin to die. Since Mr. Modene was already above .3, perhaps there’s some argument for police intervention.

But set that aside. Pretend you’re on the jury and you have to vote on whether Modene is guilty of DUI. What’s your verdict? And if you also want to weigh in on whether the government had a right to interfere with his raft trip, don’t be bashful.

For me, that second question is more challenging. That’s why I like sticking with simple questions of right vs. wrong, such as whether I side with Switzerland or France on the issue of whether fiscal sovereignty and financial privacy should be undermined to help high-tax nations impose their bad tax laws on an extraterritorial basis.

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A couple of months ago, I discussed a column by Arthur Brooks, in which he explained that libertarians and conservatives need to make a moral argument for capitalism and not just rely on statistics and economic analysis.

This is correct, I believe, and I cited myself as an example. When the flat tax became an issue in the 1990s, I gave lots of speeches, and I pontificated about lower marginal tax rates and getting rid of double taxation. I quickly learned, though, that people were most excited about getting rid of the corruption in the current system.

Brooks now makes his case for the morality of capitalism in a new video.

A superb job. His insights on earned success are very important. Indeed, this is why the dependency culture is misguided for both taxpayers and recipients.

President of the American Enterprise Institute

And it’s also why I try to stress that bloated government is basically a racket that either allows people to obtain unearned benefits or makes it harder for people to achieve earned success.

P.S. Brooks also is more than capable of making traditional economic arguments, as you can see from what he wrote about Europe’s collapsing welfare states.

P.P.S. And he has produced some first-rate research on the loss of ethics in Europe compared to the United States.

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We know that the United States and most other developed nations are in deep trouble if we leave government policy on auto-pilot. And we know the painful day of reckoning will arrive even faster if we continue the Bush-Obama policies of expanding the burden of the public sector.

All this sounds very depressing, but the good news is that we know the types of policies that will solve the problem.

The bad news is that we often don’t do a very good job of convincing people of the changes that are needed.

Part of the answer is that libertarians and small-government conservatives are probably too utilitarian. Not in our hearts, but in the way we talk.

Arthur Brooks of the American Enterprise Institute addresses this problem in a column for the Washington Examiner.

…many who strongly believe in free enterprise steer clear of all public “moral” arguments. This is a mistake and a missed opportunity. A great deal of research shows that people from all walks of life demand a system that is morally legitimate, not just efficient. …Privately, free enterprise’s champions…celebrate capitalism because they believe that succeeding on merit, doing something meaningful, seeing the poor rise by their hard work and virtue, and having control over life are essential to happiness and fulfillment. But in public debate, conservatives often fall back on capitalism’s superiority to other systems just in terms of productivity and economic efficiency. …The dogged reliance on materialistic arguments is a gift to statists. It allows them to paint free enterprise advocates as selfish and motivated only by money. Those who would expand the government have successfully appropriated the language of morality for their own political ends; redistributionist policies, they have claimed to great effect, are fairer, kinder, and more virtuous. …Average Americans are thus too often left with two lousy choices in the current policy debates: the moral Left versus the materialistic Right. The public hears a heartfelt redistributionist argument from the Left that leads to the type of failed public policies all around us today. But sometimes it feels as if the alternative comes from morally bereft conservatives who were raised by wolves and don’t understand basic moral principles. …There just doesn’t seem to be a good alternative to the “statist quo,” and as a consequence, the country is slipping toward a system that few people actually like.

I think Brooks is correct. Most libertarians and conservatives are not motivated by GDP numbers. They believe in small government because it is morally sound (no government-imposed stealing) and fair (you don’t get rich without offering something of value).

During public policy debates, though, we rely on utilitarian arguments.

I offer myself as an example. When the flat tax became a big issue in the 1990s and I started giving lots of speeches about tax reform, I would make dry and technical arguments about marginal tax rates and capital formation. But I quickly learned that much of the support for the flat tax was motivated by a belief in a fair and moral system – no cronyism, treating everybody equally, ending corruption, shutting down loopholes, etc. So I modified my speeches and gave much more attention to the moral arguments.

That being said, there’s no silver bullet in public policy fights. We probably need a combination of morality and utilitarianism. And it’s obviously important to put things in terms ordinary people can understand. That, I believe, is what made Reagan so effective. And it’s what I try to do with this blog (albeit on a much more limited level).

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As a libertarian who became interested in public policy because of Ronald Reagan, it won’t surprise you to know that I’m more of a “right libertarian” than “left libertarian.”

I fully agree with positions that motivate left libertarians, such as the war on drugs doing more harm than good, foreign entanglements such as NATO no longer serving America’s national security purpose, and the importance of preserving constitutional protections of civil liberties. But since I’m a fiscal policy economist, I normally consort with conservatives.

And my frequent interactions with conservatives sometimes lead me to wonder why we aren’t closer allies. Well, maybe we can be if both sides read what Tim Carney wrote for today’s Washington Examiner.

His column is about Rick Santorum’s inability to unite proponents of limited government, but that’s secondary to the insightful analysis on how conservatives and libertarians can be natural allies. Here are key passages.

For many of today’s liberals, if something is bad — like the traditional light bulb, a very high health-insurance deductible, a gas-guzzling car, or a lack of racial diversity — the government ought to outlaw it. Maybe they can’t comprehend the mind-set of many of today’s conservatives, who revere both individual liberty and traditional morality as the necessary conditions for human happiness and thus say that certain behaviors are immoral but shouldn’t be illegal. Not only are traditional morality and limited government totally compatible, today they are intimately linked, as the Left uses big government to subsidize abortion providers and force all employers to pay for their employees’ contraceptives. …the moral law should guide our personal actions, and individual liberty should guide our political decisions. …When liberals cry that conservatives are trying to legislate morality, that’s typically projection and misdirection from liberal attempts to legislate morality — they say we’re trying to outlaw buying contraception because we oppose their efforts to mandate buying contraception. …More often than not, in the United States these days, it’s the secular Left imposing its morality on the religious Right. Don’t want to photograph a gay wedding? You’re fined. Don’t want to sell the morning-after pill at your pharmacy? You’re driven out of your job. Don’t want to pay for your employees’ sterilization? You’re a criminal. Don’t want to subsidize Planned Parenthood with your tax dollars? Tough, pay up. An alliance between libertarians and conservatives is natural and right today. …The proper conservative response is to fight for the liberty of all Americans, including religious conservatives, to manage their own affairs according to what they believe is correct. Increasing the size of government, even in the name of a more moral society, simply gives the Left more weapons to turn on the Right in the culture war — Obamacare is the perfect example.

Maybe Tim’s column makes sense to me because I’m somewhat of a social conservative in my personal life. I’ve never smoked, never done drugs, don’t like gambling, rarely drink, don’t deal with prostitutes (other than the non-sexual ones serving in government), and have a traditional view on the importance of family. But I’ve never thought my boring personal preferences should be part of the law.

But as Tim explains, leftists believe in imposing their views on everyone else. And the last sentence in the excerpt shows why conservatives and libertarians should be united in opposition to statism. Big government gives the left the tools to advance an agenda that undermines both morality and liberty.

So with that in mind, I’m going to do something similar to Mitchell’s Law and Mitchell’s Golden Rule. But in this case, I’ll actually give credit to someone else. As shown in the picture, libertarians and conservatives should unite behind Carney’s Fusionist Theorem.

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Along with many others, I complained a couple of days ago that Mercedes-Benz was morally bankrupt for using the image of a notorious racist, communist, and murderer as part of a marketing gimmick.

Well, the company has backed down. We won. It’s only symbolic, but let’s enjoy a small victory.

Here are some excerpts from a Foxnews.com story.

Daimler AG, the German company that manufactures Mercedes-Benz luxury cars, called its promotional use of an image of Marxist revolutionary Ernesto “Che” Guevara a “thoughtless” and “stupid” decision that was not intended to offend people. …In a statement sent to FoxNews.com, Daimler said it “was not condoning the life or actions of this historical figure or the political philosophy he espoused.”

That’s probably not the most heartfelt and sincere apology ever issued, but it will have a positive impact. Somewhere at Daimler AG, there’s a marketing executive that is going to lose a bonus (and maybe even a job). Other people in the fields of advertising and public relations will have seen the backlash and be much less likely to make similar mistakes.

And perhaps a few people who were ignorant will actually learn a bit about history and begin to understand the evil nature of communism.

I doubt this will have any impact on the empty-headed kids who wear Che t-shirts, but you can’t have everything.

From a personal perspective, the best thing about this episode is that I’ve been attacked by a water-carrying apologist for totalitarianism.

In my line of work, one way to measure whether you’re doing a good job is the degree to which you get criticized by bad people.

Being called a “dickhead” by this tool may be even better than the time a left-wing British columnist called me a “high priest of light tax, small state libertarianism.”

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Since starting this blog, I’ve cited several columns by Walter Williams (see here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, and here), in large part because he’s so good at explaining economic concepts, but also because he’s very effective when demonstrating how big government undermines both freedom and prosperity.

His latest column, though, is now among my favorites since he succinctly explains the moral difference between markets and government.

In a free-market system, in order for one to get more for himself, he must serve his fellow man. This is precisely what Adam Smith, the father of economics, meant when he said in “An Inquiry Into the Nature and Causes of the Wealth of Nations” (1776): “It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest.” …Free-market capitalism is relatively new in human history. Before the rise of capitalism, the way people amassed great wealth was by looting, plundering and enslaving their fellow man. Capitalism made it possible to become wealthy by serving one’s fellow man.

I’ve tried to make similar points, particularly in my post about government coercion vs. private charity. But Walter has a way with words.

I also like the way he closed his column. After explaining that big businesses often oppose capitalism, he then shows the similarity between tyrants and other statists.

Free-market capitalism has other enemies — mostly among the intellectual elite and political tyrants. These are people who believe that they have superior wisdom to the masses… Tyrants do not trust that people acting voluntarily will do what the tyrant thinks they should do. They want to replace the market with economic planning and regulation. The Wall Street occupiers and their media and political allies are not against the principle of crony capitalism, bailouts and government special privileges and intervention. They share the same hostility to free-market capitalism and peaceable voluntary exchange as tyrants. What they really want is congressional permission to share in the booty from looting their fellow man.

If you want to learn more about this remarkable economist, here’s a video about Walter’s life and here’s an interview about his latest book.

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