Friday, March 12, 2010

Chait on Ryan and public policy:

He's got some sharp observations about Paul Ryan's budget and tax proposal, and also writes this:
The basic thrust of liberal public policy over the last century is to keep in places the market system but use government to slightly mitigate against risk--the risk of getting sick, the risk of outliving your savings, the risk that you just won't make much money in the first place. The downside of these policies is that, in order to mitigate the downside risk, you also have to mitigate the upside benefit. If you're unusually rich, you have to pay a somewhat higher tax rate than most people. If you're unusually healthy, you have to subsidize medical care for people who aren't. If you were able to invest well enough to cover your entire retirement, some of your good fortune will be siphoned off to those who weren't. The rewards for getting rich, or merely being born rich, will remain enormous, just slightly less so than in a completely free market.

Republicans want to eliminate these mitigations of risk. Ryan would retain some bare-bones subsidies for the poorest, but the overwhelming thrust in every way is to liberate the lucky and successful to enjoy their good fortune without burdening them with any responsibility for the welfare of their fellow citizens. (...)

The core of the Randian worldview, as absorbed by the modern GOP, is a belief that the natural market distribution of income is inherently moral, and the central struggle of politics is to free the successful from having the fruits of their superiority redistributed by looters and moochers.
Chait is saying that Republicans are opposed to national insurance programs. Of all types (health, retirement, employment). And they are!

Also, is the natural market distribution of income inherently moral? Certainly not in all cases. There is luck involved, as anyone who dabbles in the stock market can tell you. Large market forces in far-away places can affect one's fortunes here, for better or worse, no matter how much talent or effort is deployed. And how do the inheritors of wealth function within a market? Then there's health, which is not market driven in any way. But for those who are in good physical shape and well off, Ryan's governing philosophy is attractive.


Also, is the natural market distribution of income inherently moral? Certainly not in all cases.

Depends what you mean by "market distribution of income."

A huge fraction of inequality created by "the market" is due to parasitic rent collection.

Thus, if we differentiate between non-rent-producing capital and rent-producing assets, much inequality is produced by the latter, and inherently in an unfair manner.

Thus, the opposition between "capitalism and freedom" and "equality of outcome" isn't nearly as strong as it might otherwise appear to be.

By Anonymous Anonymous, at 3/15/2010 7:47 PM  

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