Economic equality is a pipe dream

by judahlevi

examples of this type of economic system are the former East Germany and Soviet Union where “fairness” and “equality” were the government’s economic goals

There are many people who are arguing for “fairness” in economic wealth in the country. But what is fair and who decides?

Two economic principles describe fairness in economic terms. One is called the “utilitarianism principle” and the other is the “symmetry principle.” One tends to be a forced solution where you are forcing all incomes to become equal by the government taking wealth away from the productive members of society until all incomes across society are equal. The other is completely voluntary where the only legitimate, and legal, way of distributing property is by voluntary transfer.

Utilitarianism is the principle of forced re-distribution of wealth from those who have more to those who have less. Government power is at its peak. Wealth confiscation by government agents, whether the IRS or other agents, is forced upon those who have worked hard and created more wealth than others. From an economic viewpoint, and also individual rights viewpoint, this has severe problems. In the short run, it may create more economic equality for more people. In the long run, it would be an economic disaster.

Utilitarianism will disincentivize the producers of society since any excess wealth they create will be taken from them. They no longer have an economic reason to be creative or work hard. Although not all people are motivated purely by money, the vast majority work harder than they normally would for the incentive of a better life. Their reduced motivation to work will contract domestic GDP so that you may have everyone getting a equal slice of the pie but the pie will be much smaller. It also has the problem of the huge costs involved in creating a bureaucracy to administer such a wealth transfer which would be an economic burden to the country. The examples of this type of economic system are the former East Germany and Soviet Union where “fairness” and “equality” were the government’s economic goals.

Symmetry is where all exchanges of property of any kind are done voluntarily. Everything of value is owned by someone and the only way to exchange it would be a voluntary exchange between two parties. Government’s only role would be to enforce private property rights and preserve the sanctity of legal contracts. From an economic perspective, this principle would produce the most efficient allocation of resources in a society. An economic example of this is a democratic society with a fully free market economy which does not currently exist anywhere in the world today. The United States economic system comes close but is not as free as the symmetry principle proposes.

It seems clear that economic equality is a pipe dream. Just as people are different, their outcomes in life will be different. You cannot force equal outcomes on all people without a police state type of authoritarian government which has no respect for private property or individual rights. Yes, we should have a social safety net that prevents any citizen from falling through but we should never try to equalize wealth in the United States. To do so would be to economically destroy the country.

Share
  • Drurylane

    True. Compassion is birthed in the heart, not Washington D.C.!

  • valley person

    So you would like to end Social Security and Medicare?

    • Drurylane

      Sure. Just give me my contributions, with interest, and I’m fine with that! Ever the contrarian, aren’t you valley phantom person!

      • 3H

        Are you on the Koch brother’s payroll?

        • Drurylane

          Ooooh, good one!!

          • Drurylane

            Must be why I am struggling to hold on to my house! I am out front as to who I am. Are you?

          • 3H

            Out front? I’m not sure what you mean. If you mean do I use my real name? No. Obviously not. That would be true of the majority of the posters – both liberal and conservative. What is your point?

          • Drurylane

            Why obviously not? You afraid of something? All you have to do is read my post to know who I am!

          • Drurylane

            And troll master, I am not talking to you.. You have not graced me with your idiotic rhetoric. Goodbye!!

          • Drurylane

            You all take your cue from your grand master. Lie, deceive, deflect, distort. Sleep well!

          • 3H

            You are… trolling yourself now. That is just too funny.

          • Drurylane

            Good night.

          • Drurylane

            And yet no reply why you are afraid to use your own name. Why am I not surprised?

          • Drurylane

            Anything you say means nothing if you’re unwilling to put your name behind it. The difference between you and me.

          • 3H

            I disagree.. the meaning is in the content, not always the person making the comment. The Federalist Papers, to cite a famous example, was originally written under a pseudonym. I’m not comparing myself to Hamilton, Jay and Madison by any means, I’m just noting that the content of the Federalist Papers isn’t changed by knowing the authors. Sometimes it forces the reader to address the material, rather than the author. This is not a hard and fast rule.

            I just feel it is better to remain anonymous, as many others on here do: both conservative and liberal.

          • valley person

            Is drurylane actually this guys name?

          • 3H

            Who knows? Maybe his parents liked nursery rhymes.

          • 3H

            Well, if you really want to know, my name is pretty uncommon and I’d be easy to find and harrass. I don’t necessarily trust everyone on here (although I’m certain that most on here are fine). And, given your outbursts, I think it is a wise decision.

          • guest

            Guessing there’s at least two Guest monikers mongering here ‘sides an occasional little troll*op guest.

            Soros to say, d’oh, it’s brunnmigi like vp and 3H, propped up by ardbed, attempts at bergtagning the truth in politics posted at OC.

          • Drurylane

            Hahaha! Obviously not. Of course! Grow some cajones!

          • Drurylane

            The point is you know who I am! I am not ashamed of who I am. Why are you?

          • 3H

            No, not really. Just not any less silly than your comment about being on Soros’ payroll.

      • Drurylane

        So, no reply?

      • valley person

        Because I’m on Soros payroll, he had me working all day. A real slave driver that one.

        Personally I’d be happy for the government to hand you your SS contributions, plus interest, give you a voucher for medical care, and let you fend for yourself at 65, 66, or when you choose. I’m all for an opt out.

        But based on the story you posted the other day, I wouldn’t be so quick to take it if I were you.

  • HBguy

    I try, I try, to be sort of nice. But this post……

    I’ll save you five minutes of your life and summarize this post for you.

    …..There are two types of economic systems. One that takes all your money and gives it to lazy and stupid people. And another that lets you decide how to spend all your money. We should let people keep all their money and decide how to spend it because that would be better….

    Of course, The author then destroys his own message by admitting….we should have a safety net. Why? Why should we have a safety net? Because the author thinks it’s fair?

    And, Not sure who is supposed to decide what that safety net should be, or how we raise the money for it. Not sure how we pay for bridges, for public health emergencies, military, fire protection, prosecution of polluters who dispoil public waterways, etc, etc, etc.

    This post would get about a C- grade in a community college freshman philosophy class.

    • Drurylane

      VP and 3H must be part of the Occupy mentality. They have all the time in the world to rail against successful people in our country, and have nothing to offer other than tired rhetoric. Please, you guys, your mind numbing idiocy makes us all have a laugh before bedtime. At least I can thank you for that!

      • valley person

        Mr D, I don’t want to be the one to break this to you, but either 3H or myself could probably buy and then re-sell you.

        • Dean Apostal Lies

          You can barely pay your bills dean. If it wasn’t for your piddly pension, you’d be living on the street instead of that crappy little dump in Damascus.

          • 3Hall

            Perhaps he should ask Soros for a raise?

          • valley person

            Hell with the raise. I’m wondering where that pension check is.

          • Dean Apostal Lies

            So, what kind of illegal stuff does one have to pull to lose one’s USFS pension?

          • valley person

            One has to be old enough to collect it.

  • Drurylane

    Hey trolls! You’re toast! History!! Done!! (sleep well)

  • Judahlevi

    For those who had a hard time understanding this post, the first clue is that it is not about “philosophy”, it is about economics. For the same person who made that mistake to then go on and “summarize” the post is like the blind leading the blind. It doesn’t work well.

  • guest

    Where’s ardbeg on this?

    • ardbeg

      Did you miss me? Someone has to pay the bills around here.

      • guest

        Gosh, yes, you’re missed! You’re the third and likely sturdiest member of the tripod, er, triumvirate ‘couched’ by fellows VP and 3H.
        Yet as you say, someone has to pay the bills around here – pity or pithy – while your amigos take to chasing their tails or cars. >;~)=)