Libertarianism, In Theory and Practice

redistributing wealth removes the incentive to earn and create wealth.

Assume, for the sake of argument, that the statement is true, in maximal form; if there is no incentives, from full egalitarian redistribution, there will be no wealth production. It does not necessarily follow that partial redistribution will produce an absence of wealth-production, merely a marginally lower rate. If a greater level of egality is desired and agreed, even if the aggregate product is lower, this seems within the realm of rational social choice. Our utility function may include (as many do) the disutilities emergent from extreme wealth concentration; the Spirit Level being the empirical book du jour for advocates of this egalitarian approach.

Only because inequality of wealth is possible in our social order, only because it stimulates everyone to produce as much as he can and at the lowest cost, does mankind today have at its disposal the total annual wealth now available for consumption.

I find this quote pernicious as a logic; the same justification could be made for slavery, or any coercive social institution. I'd apologize for the slavery analogy, but 'produce as much as he can at the lowest possible cost' fairly begs it. The Whip is justified, because the Product obtained by using the Whip is so much the greater, so complain not of its stings and lashes, for your pain serves the Higher Good. As a position, I find this incompatible with liberty, as I conceive it.

Were this incentive to be destroyed, productivity would be so greatly reduced that the portion that an equal distribution would allot to each individual would be far less than what even the poorest receives today.

Apocalyptic rhetoric indeed. Note first incentive must be destroyed utterly for this to hold, rather than an efficient level of inequality or incentive, and no other possible incentives for production of any kind must exist, an ontological claim that the only possible motivator for human action is self-interest within a profit-maximising framework. Then and only then, we might be forced to agree.

Unfortunately or happily, dependent on your taste, not all of these assumptions seem robustly tenable, and the conclusion less forcefully foreordained.

It's not a necessarily obvious one, and the conclusion you assume as given would require demonstration. If the story were that simplistic, social democracy would no longer exist, having been poached out of existence long ago. It's resilience requires explanation, which you appear unable to provide.

I apologize for misquoting Mises (sloppy Kama no banana) though I'd note that your disapproval here does not extend to a response to the argument itself: the coercivity required and the similarity of logic between Mises here and collectivist utopian projects, of an element of duress as necessary for an end product. One man's 'stimulation' is a anothers 'sting'.

I'd be with KickOutTheJams on this: we are always constrained by our options. Your freedoms are viewed as coercive by others, and vice versa for their freedoms; a Marxist mash-up might call rechristen it 'The Road to Wage-Slavery'.

Take away self-interest and the profit-maximizing framework, and the results are not pretty.

Valorize it into a moral system, prioritze it to the detriment of other values, and the results are also somewhat ugly. Unlike some others, I am no cheerleader of the Soviet system, but neither do I find morally acceptable extremes of wealth on the libertarian lines you advocate. Hence, the (to me) far more fertile question of what an efficient level of inequality is. I assume here that costs are imposed both by enforced egalitarianism and by an unrestrained inegalitarian system.

donegalfella wrote:

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You put forward a model, that 'Lib' regimes will inevitably outcompete 'SocDems' in a pretty one-way dynamic. I asked how you accounted for there still being any, if the story was this 'naively' straightforward. The response was that it hasn't happened yet, but still, inevitably, will.

My argument would be that there must be some kind of advantage in the SocDem framework you are not factoring in, or in the evolutionary ecology of international regime-types, they would have long died out, and the liberal fittest be the only survivors. And yet, regimes other than the model you espouse have continued, with many of the worlds richest countries within them, which suggests to me some advantage of some kind must be present.

I suspect your position on this to be, perhaps, that all the varieties of social democracy are a late-stage parasitism on successful liberal societies, the feckless butterfly to the liberal larva.

The notion of the person who, born with nothing, can choose to live from cradle to grave on the redistributed wealth of others is a fairly modern idea.

Indeed. While the notion that the person, born with far more, can choose to live off the accumulated advantages of their position is at least as old as the Pharoahs. Redistribution of some kind mitigates these initial inegalities; meritocracy requires somewhat of a level playing field not to be a sham.

You may not find it "morally acceptable" that a person should expect to keep the fruits of his or her own labour, creativity, inventiveness, and investments.

To a large extent, I do. But I'm heavily opposed to rentiers and the ability to reproduce wealth from posessing an initially privileged position. As often recurs, meritocracy proper would require 100% inheritance tax, a highly 'illiberal' position.

I don't find it "morally acceptable" that some social democratic states deploy effective tax rates of close to 40 percent on someone making $100,000 a year.

They do their business within a territory, and avail quite willingly of the benefits provided by others, and by previous generations, who have developed the infrastructure of the country. The entirety of their product is not self-generated, but required inputs which they did not pay for; they eat the meal daily, yet whinge about the bill.