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I know I don't do these every day or even every month, but perhaps if I say so it will make me do it - it could be a cool feature perhaps.
Say everyone earns the same wage, $100. The Government taxes income (and income only) at 20%, and has a choice of two policies - A and B.
Policy A lowers the income tax to zero with no other effects (I suppose the Government isn't doing much to start with). So people now earn $100 after tax (up from $80).
Policy B raises the national income level by 25%, meaning an after-tax wage of $100, however it violates people's rights slightly by doing so, perhaps by forcing them to work as slaves for 10 minutes every day.
Which policy would you prefer? In this case it's easy, as they both give the same income level but one has us working as slaves. So you would choose policy A.
But what if I change the numbers? What if policy B doubles the national income, at the cost of 20 minutes a day of slave labour?
The reason I ask this is that I think the majority of deontological theories of political justice (like that of Rawls) take into account consequences at some level (Nozick and Kant being the two obvious exceptions, and even Nozick allowed some ad hoc consequentialism). What is often less clear is how they determine the tradeoff - at what point do we bite the Kantian bullet and just say that rights are too important? At 3 hours of slavery per day? At 8? Or vice versa, at what point does welfare override basic freedoms? What if you could abolish scarcity by putting cameras in everyone's house (don't ask me how) without telling them?
This seems like an obvious question but it is one I think that is rarely spoken to. In particular, most people tend to believe in the fortunate coincidence that their favoured policy is both welfare-maximising and non-rights violating, at least to a certain degree. But if that is not the case, how much welfare is worth one rights-violation?
Notice that I am defining considerations of redistributive justice out of my thought experiment, I think that would overly complicate things.
Update: BK Drinkwater shares his thoughts. He promises he will talk less in the abstract in the future - I make no such promise.
Friday, August 7, 2009
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Meh. Can you point to an example of Policy B that would actually boost national income?
ReplyDeleteGovernments can't do anything to push production upwards, because production comes from individuals and businesses operating in a free market.
So basically, until you can point to a real example of 'wealth creation' or 'boosting national income' by the government, this thought experiment doesn't get off the ground for me.
It's really just a thought experiment, and the point of those is that they don't have to actually happen, but we can draw principles from them and apply them to things that do. If the thought experiment was a perfect mirror of reality, it wouldn't be a thought experiment any more!
ReplyDeleteThat said, I do think provision of public goods and internalising externalities help with economic development. But that's kind of irrelevant.