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Fighting Inequality

 November 27, 2012 11:34 AM

NYT reporter Nicholas Kristoff notes that private power generators are extremely useful given the poor quality of modern US electricity infrastructure.  This governmental inefficiency leads him to the conclusion that we need more progressive taxation. In the second century BC Cato the Elder ended each of his speeches with 'And, Carthage must be destroyed'. I think liberals should simply append all their posts/articles/editorials with "and, tax the rich and spend more" via some symbol (§)  just to save space. Everything they see supports this conclusion in their minds.

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Alas, to what end? Kristoff laments bad public schools, parks, neighborhoods, and libraries. Spending on these items, per capita, has risen over time. It seems indefensible to assert that the problem is a lack of money, given we spent half as much 50 years ago, failing districts like Los Angeles and Washington DC have some of the highest per pupil spending, I don't see how money is the problem.

The main pretext for equality is that prosperous societies have less inequality, ergo, less inequality creates prosperity. It's a pretext because I think the main reason most liberals want to tax the rich more and have bureaucrats spend it is simply to bring the wealthy down a notch, why they really don't care that historically spending on education doesn't increase learning: that's not the point.

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I'm a libertarian, but not because I think it maximizes welfare given current capital, but because it creates more capital by motivating us to act better, which helps us in spite of ourselves.

When we treat man as he is, we make him worse than he is; when we treat him as if he already were what he potentially could be, we make him what he should be. 
If I accepted our envious instincts as optimal I would be indifferent to efficiency, because in aggregate relative status is no different here as in Haiti. I'm glad I have the wherewithal to read and think about ideas, a luxury unaffordable for most of my ancestors, and this isn't possible because of appealing to the mob's instincts.

Look at how we've decided to lessen inequality through the public schools: we don't expel troublemakers, we don't fail under-performing kids, we don't encourage specialized advanced curriculum. The result are schools teaching to the lowest common denominator, and classes distracted with behavioral issues that overwhelm any potential for learning. Any parent with the wherewithal moves to districts where such anarchy has a lower level of dysfunction, and leaves this mess for those unable to move, so these inner city schools become extremely dysfunctional. Kids at poor schools realize diplomas from such institutions don't mean anything, and drop out more frequently, lowering their ultimate human capital acquisition.

The result is that while schools prioritize equality, the result is highly unequal, treating unequals the same in the school. The failure of public schools is lamented as a result of inadequate funding, which is totally orthogonal to the drivers of their poor performance.

In a totally different fashion, affirmative action creates greater inequality via mismatching minorities, putting them in groups where they are underqualified, leading to greater discouragement and switching to easier majors that aren't as helpful. In healthcare, making everyone have the same 'rights' to health care inflates our health costs. Trying to ameliorate inequality via top-down directives is invariably counterproductive at the limited objective of reducing inequality.

What makes private institutions excellent is that they have the right to exclude those who ruin it for everyone. They require an investment by their consumers so they don't take these things for granted, but rather respect their access.  This should give those at the bottom an incentive to do well, and a place to go if they do well. In contrast, by making all their public opportunities non-exclusive regardless of behavior, everything is lessened and individuals have less incentive to become better persons to get access to these better things, and also ruin it for everyone else. My city library is weigh station for noisy kids, so I never hang out there.

Most liberal think prioritizing equality in education, crime, and parks, is an obvious way to increase our wealth, which not coincidentally takes the rich down a notch, unaware that these same policies just make inequality not as much within schools as between them. Forcing everyone to have the same public school/library/healthcare will merely create a two tier systems and raises costs for everyone. There are lots of things we can do to help our infrastructure and public objectives right now, but they aren't nearly as popular because they don't take power away from the rich and give it to bureaucrats (eg, allow nurses to distribute penicillin, allow power plants to invest in the best technology, don't force refineries to use ethanol, give students education vouchers). The failure of past government policies is a poor reason for a larger government.



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