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The Forum > Article Comments > The economics of equity and justice > Comments

The economics of equity and justice : Comments

By Kasy Chambers, published 30/6/2009

The traditional distance between ethics and economics - or between the community sector and business - is artificial.

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This thread has become somewhat intimidating to anyone not grounded in an understanding of philosophical theory, so I approach it with some trepidation.

But - attractive as the discussions on the foundations of ethics have been so far - I'm not sure we are addressing the essentially practical nature of Ms Chambers' piece.

The quote at the beginning of the article is important. It encourages us to examine our own role in the current financial mess, and our laissez-faire approach to governance and government.

An attitude of "What they do suits me fine, so I'll go along with it" has been behind a number of habits that would have appalled the post-1918 generations, who necessarily lived more thriftily than we do. And whose commerce leaders were - largely - less inclined to look for the friction-free profitability of, say, interest arbitrage, and more interested in building dynastic businesses.

It is important for us to question the fundamentals of what we want out of life, why we want it and what we are going to do about it. Because it is that contemplation, whether inbred, instinctive or taught, that guides our attitude (read: ethical motivations) towards work, family and society.

It was this important point that the article made. That there is the emergence of a glimmer of a scintilla of a tiny spark of evidence of this, in a speech by the Head of Treasury.

And I hate to say it, because I have genuinely enjoyed the discussion to date, we are not going to make progress in this direction by educating the masses in the art of philosophical discourse.

We need to start using, as Ms Chambers points out, a language that reflects some new level of ethical dealing between people, that does not automatically assume that being wealthy is the same as being clever, or that profit, both personal and corporate, is an absolute measure of value.

Having said that, I haven't a clue where to start.
Posted by Pericles, Friday, 3 July 2009 8:36:53 AM
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Yes, I see now it was nasty of me to use a circular argument to describe a linear progression (spanning centuries, describing a progression of birthrights to allow the exploitation of the less fortunate by the fortunate).
Do you believe it is ethical for someone who just happened to be born strong, to dominate the weak? Or someone who was born the son of a strong man, to dominate the weak? In bygone times, such a person might claim 'Ius Primae noctis' at your daughters' wedding, or your own.
Is that your concept of Liberty?
Do you believe it is ethical for someone who is fast with a gun (and willing to kill) to dominate the weak?
The point is, these people didn't earn the right to their genetic inheritance. There is no such thing as a 'self made' man. No one gets to choose whether they are going to be strong or fast; and certainly no one chooses to be unintelligent.
Our current society supports, even encourages 'type A' personalities; those who are insecure, and need to prove themselves, driven overachievers who are ambitious, ruthless and greedy.
It appears to be becoming more and more true that 'nice guys finish last'.
Unless you are a God botherer, who believes it is God's will that the strong are born to dominate the weak, the only justification for one opinion supplanting another, is that there are more people agreeing with the first opinion than the second.
This is called 'Democracy'. It ain't great, it's just better than the alternatives.
And the law (democratically written) is supposed to stop the strong from exploiting the weak.
Taxes are a function of Law.
Posted by Grim, Friday, 3 July 2009 8:43:30 AM
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You did manage to come up with one thing I agree with, Wing:
“You have not given any reason to think that the law will not itself be used as an instrument of exploitation.”
Very true. Currently, all the lazy bludgers who make the median wage (35k) are going to get a whopping 6 bucks cut from their tax bill, while the poor hard workers unfortunate enough to share the same tax bracket as our legislators (over 100k) will have to struggle along with a lousy 30 bucks cut.
There is very little chance the Law will protect the (economically) weak, when laws are written by the (economically) strong.
As to the question of redistribution of taxes, this is obviously a hangover from an earlier, more chivalrous age, which is quickly being 'corrected'.
Or is it a hangover from an age when legislators were more representative of their constituents, instead of career lawyers, and money managers?
Either way, it is simply a recognition of the fact that the more fortunate have some simple obligation of Humanity, to support the less fortunate.
Particularly as in most (arguably, all) cases, their fortune comes from the labour of the weak.
Is it ethical to 'coerce' the rich into giving up some of their wealth to support the poor?
Perhaps not. Perhaps it would be more ethical to wait for the rich to donate that money freely.
Yeah, that's going to happen.
Pericles, hear hear. (You snuck your very worthy post into the middle of my tirade.)
As I have indicated, I believe going back to representative government, rather than elitist government, would be a good start.
As you say, getting people engaged is the problem.
Posted by Grim, Friday, 3 July 2009 8:52:12 AM
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Ozbib
“[I]t does not follow that people are entitled to do whatever they wish, whatever the consequences.”

No-one is arguing that. Rather, people are entitled to do whatever they wish, so long as they are not aggressing against the person or property of others.

“[I]t is easy to show that the principle of liberty is not the foundation of ethics.”

Maybe so, but you haven’t shown it.

The Deontologists et al. *do* accept that they own their own bodies by the very fact of their speech-acts – that’s the whole point. Everyone does. They prove it by their actions, whatever their words may say.

Obviously you don’t own your body in the same sense that you own your computer, but that doesn’t mean you don’t own your body. But if you don’t, who does? Answer? A majority of whatever group manages to get the weapons to call the shots? Because that is what the redistributionist argument comes down to.

“…no matter how poor those who helped [people] get [property] are.”

This idea is problematic. The state’s forced re-distributions do not give to ‘people who helped one get one’s property’ but in the sense that they are members of human society. This provides just as much justification for the rest of mankind to participate in the forced redistributions. In fact obviously, those in Africa, India etc would be more entitled than Australians.

Also, you assume that the poverty of others has got nothing to do with the actions of the re-distributionists. But in fact the main practical argument against such interventions is precisely that they are the main cause of the poverty and disadvantage that they are intended to remedy; they actively worsen it. A classic example is with the Aborigines.

Also, in asserting a claim to other people’s property based on inequality, it is arbitrary where, short of equality, this claim could end. Such equality is impossible in practice but even if it were not, it would spell the end of human society, because no-one could obtain any advantage from associating with others.
Posted by Jardine K. Jardine, Saturday, 4 July 2009 4:50:54 AM
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In short, the idea is bad in principle and bad in practice.

“People rarely get to own property substantially more than that of others by their own unaided labour.”

They also rarely get it without giving valuable consideration. The consent of the person they got it from answers all ethical issues *so far as force is concerned*.

You have not established any moral title in anyone else; nor have you shown how, if others use force to get it, it can be ethically distinguished from robbery. The fact that a robber is in a position to declare his own crimes legal is no justification.

Grim
At least you recognize that political action causes injustices that cannot be fixed by more political action.

If 12 men and one woman vote whether to have sex, and the men vote for, and the woman votes against, so they coerce her into it, that doesn’t mean it’s okay, and it doesn’t mean it’s not rape.

Democracy adds nothing to the ethics but majority opinion. However majority opinion is not capable of supplying the ethical justification for violating someone else’s person or property.

It is the redistributionists, not the advocates for freedom, who are contending for the idea that the strong, by that fact, have a right to dominate and exploit the weak.

Pericles
No-one is suggesting that being wealthy is the same as being clever; nor that profit is an absolute measure of value.

But what profit does show is that the person who made it was able to adjust the factors of production in such a way that the result, the product, was better at satisfying the most urgent needs of the people, *as judged by themselves*, than was the arrangement of the factors of production before he got involved. He should not be vilified or suspected for this contribution to human welfare. It is not anti-social; he is not hurting anyone; he is not exploiting anyone; he is not exercising “power” as against them. Their consent answers the ethical issues.

All
No-one has justified forced re-distributions.
Posted by Jardine K. Jardine, Saturday, 4 July 2009 5:21:11 AM
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ISTM that the principle reason for redistribution of wealth is to minimise the potential for unrest caused by a resentful or inadequately housed/clothed/fed underclass. Yes, the amounts may be arbitrary and what constitutes "adequate" may be debatable, but without the effort being made, such resentment has boiled over frequently throughout history, creating much upheaval.

The redistribution needn't be a forced one, it may be entirely voluntary, such as Gates with his foundation or Buffett with his, but to do so with force is arguably more "fair" in the sense that not all who may gain from the increased social stability may be prepared to contribute their part to the redistribution. Furthermore, if they don't, it may well lead to upheaval among those high-wealth groups, inevitably defeating the purpose of the redistribution.

Where it breaks down, ISTM, is when there is fostered a sense of entitlement to someone else's wealth, based on a nebulous claim. It is much easier for that to occur in a forced-redistributive system, since the people making the decisions as to the "worth" of a claimant for support are not personally linked to the outcome of their decision. For example, if a beggar comes to me in the street and says "please give me $10", I may smell the grog on her breath and refuse: if she goes to centrelink and says "I need the dole", no such problem exists, merely a set of easily-negotiated barriers that can be set aside if the person processing the claim wishes.

The same applies to all sorts of activities that are taxpayer-funded but would be unlikely to have gained support from individual philanthropists. In extremis, such as we now observe in Australia, it leads to an enormously large class of people who see themselves as "entitled" to some of someone else's hard-earned. It has lead to the ridiculous situation in which personal income tax is a net $5billion loss to the state after all the redistributive measures have been applied.
Posted by Antiseptic, Saturday, 4 July 2009 8:15:25 AM
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