Extreme libertarian Challenge

Radley Balko is a thoughtful libertarian blogger who provides particularly awesome coverage of criminal justice system misconduct. You should read it. In Reason magazine he’s issued a challenge for “lefty bloggers” to define their limits “on the size, cost, and influence of the federal government.” I think this has the potential to be an interesting exercise, but in another way it feels kinda cheap. A few lefties will bite, say dumb things, and libertarians will jump all over them in the comments and we’ll have really pushed the debate forward… I don’t consider myself “lefty”, but I guess I do find the conversation of how to provide a safety net and upward mobility for the poor more important than a debate over what level of taxation on the clearly rich represents “tyranny”.

Maybe an equally misguided but enlightening exercise could ask libertarians to define what the lower limits of government should be, assuming that the private markets and charities would (did) not serve all citizens.

  • How much poverty among the elderly would be acceptable?
  • How much malnutrition or starvation would be acceptable?
  • How much illiteracy among lower classes would be acceptable?
  • With only domestic defense, how much genocide by the Nazis would have been acceptable?
  • How much land and wealth should estates be able to stockpile over many generations?
  • How “free” would individuals be who were born impoverished in an area mostly owned by wealthy estates, had no minimum wage, and no access to public education? In other words, would areas resembling a more modern version of serfdom be acceptable?
  • Given that private “seal of approval” type agencies could not prevent large ad campaigns for dangerous products or drugs, how many deaths and injuries would be acceptable to allow the market to self-regulate? And once the product is exposed as deadly, should the manufacturer be free to continue marketing it to whomever he can fool, e.g. uneducated/poorly informed areas?
  • How many should be allowed to live with unsafe water, broken plumbing, shoddy electrical wiring or construction?
  • How much illness or death among the poor would be acceptable for those not covered by private or charity health care?
  • Should people be free to use unlicensed doctors? If a market led towards increasing numbers of people receiving care from ill-trained physicians, how many would be too many?

These questions are unfair and as arbitrary to answer as Balko’s. We should certainly aim to maintain the personal freedoms of individuals, and the federal government is an entity that can limit those freedoms, but it’s naive to believe that it’s the only one. Unchecked organizations (even without significant size and power) can have a similar potential to limit freedoms in ways that may be alien to those of us growing up in “nanny states” (in most developed countries).

I’m a fan of market-based solutions, but I think society does have the right to compel its government to solve what it sees as significant problems unsolved by markets. Certainly better solutions arise over time (and we should work to implement them), but I can’t place a ton of blame on previous generations who found it unacceptable to wait for an ideal solution. That programs and laws are hard to remove/reform is a real problem, but it doesn’t mean we should never create them when we really need to.

Maybe what this conversation is really about is health care; in which direction to move and how soon. I just don’t have the answers. Perhaps more de-regulation of the insurance market would not end up as a race to the bottom (to the state with the least regulation). I wonder if completely separating health care coverage from employment would yield a better result (it might make employment less sticky, which seems good). I think there’s some truth to the notion that the costly U.S. system provides the innovation that improves care everywhere and allows the rest of the developed world to enjoy it cheaper, but at the same time I don’t know that U.S. citizens should be forever required to bear those costs. I’d agree that whatever reform we do, getting it right is more far more important than obeying some politician’s “deadline” and I don’t have a lot of faith in either party involved to pull it off.

I’ll bite on some of Radley’s headings at least.

Progressive Taxation? For it, with capital gains and dividends considered as income, ditching the corporate tax. As many state in the comments, without payrolls considered, the system in practice doesn’t appear as progressive as the raw numbers might lead everyone to believe.

I like the Fair Tax’s incentives to save (and reuse/recycle), but have read a few compelling critiques of how disruptive and unworkable it could be, and fear the likely result would be high state income taxes in every state and a huge shock to the economy (not to mention making the total tax burden even less clear). That and the selling point of “keep 100% of your income” is clear deception.

However we fund public defenders, it’s not enough. I think Radley makes that clear.

Inflation = Bad, but deflation could be worse. I think in this instance we should audit the Fed, but I’m not sure the Fed is any more dangerous than a hard currency or political-influenced money system would be. I was against the stimulus, but now I think it will help local/state governments less painfully reorganize to keep helping the needy. I’m against another one. I wish economics was less of a guessing game.

Entitlements? Um, keep the effective ones and fully fund them? Could mandatory sunset provisions and re-evaluation requirements for large programs help them not outlive their utility?

Income Equality doesn’t really bother me if taxation is progressive and limited resources like property don’t become too concentrated.

I feel I’ve stuck my neck out here, so please keep comments respectful.

2 thoughts on “Extreme libertarian Challenge

  1. Aaron says:

    Mr. Clay,

    Thoughtful as always. Thanks for sharing. I don’t know the answers to the health insurance problem, either. The issue is a salient one for me due to my diabetes and desire to be self-employed. I’ve found the incredible cost of private insurance to me to effectively stifle my ability to innovate and start a small business.

    Anyhow, a thought about your initial list of questions: it strikes me that they aren’t valid correlaries to Balko’s. Your implied assumption is that the government is the answer to those problems. I think your questions might be improved by tweaking them slightly to ask if there would be a point at which any of those problems would be so severe as to dictate government action/policy.

  2. says:

    Your situation certainly shows where the breaks down. If all diabetes patients purchased regular treatments out-of-pocket, it might be much cheaper, but still, in general such a system would be unfair for all persons with chronic needs. If a market-based system reduced costs considerably across-the-board, it’d be easier to justify subsidizing some groups.

    If is accurate, the upcoming reforms go in exactly the wrong direction.

    WRT the questions, I attempted to pre-qualify them…

    …assuming that the private markets and charities would (did) not serve all citizens.

    …but, yeah this isn’t really a response to Balko but a reaction to some of the more extreme libertarian views. They seem to ignore the brutality of history that led people to enact some of these laws that they’d have disqualified on principle. To be fair I probably should make another post outlining where I do agree with them.

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