Saturday, 21 August 2010

Are The Poor Really More Charitable?

A fact that I’ve come across in a couple of different contexts in the last few weeks is that the rich give a smaller proportion of their income to charity than the poor. According to the most recent such survey by the Charities Aid Foundation (albeit from 2002), the bottom 10% of the income distribution gave 3% of their weekly household spending to charity; the top 20% just 0.7%.
It is certainly a fascinating finding. But I’m a bit wary of drawing the obvious conclusion, that the poor are somehow more virtuous and altruistic than the rich. There is some evidence that the poor are inclined to be more charitable: see Berkley psychologist Paul Piff’s recent research. Nevertheless, I am not convinced that this tells the whole story.
The crude data overlooks the fact that most people do not think about charitable donations in the same way as the study. Most people could give you a clear idea of how much money they give to charity (£10 a month, £200 a year), but few could tell you off the top of their heads what proportion of their income this constitutes.
This is significant. Imagine a rich person earning £100 000 a year were comparing their charitable activities with a poor person earning £10 000 a year. If the rich person saw that they were donating £700 a year, and that the poor person gave away £300, they would most likely see little cause for embarrassment, and little reason to change their behaviour. The chances are that they would never even realise that proportionately, the poor person is four times as generous. And that doesn’t even take into consideration that poorer individuals have to spend a higher proportion of their income on essentials, such as food and clothing. This means that their sacrifice is greater: the poor have fewer luxuries, but are still more willing to give them up than the rich.
Our ideas of our moral obligations owe a lot to how we see others behave, and to the expectations others have of us. The problem with charity, essentially, is that we are continually told that anything will do, being mightily praised for the merest contribution. Moreover, charities regularly request fixed contributions that have to be accessible to everyone. The result is that giving £2 a month leaves you feeling as if you have done your bit, regardless of whether it comes out of a monthly budget of £200 or £2000.
The answer, clearly, is to define more clearly what ‘doing your bit’ entails. In almost any other context, doing your bit involves making greater demands on those more able to bear them. There is no reason why charity should not be the same. How this is to be done is trickier: social and cultural change are invariably difficult to engineer.
Interestingly, the Conservative party’s policy paper on volunteering (downloadable here)identifies exactly this problem, and sees the solution as the ‘establishment of a pro-social norm’ of giving 1% of income to charity. They’re not particularly clear as to how they intend to achieve this (ruling out the government, of course: “in the post-bureaucratic age, governments should not first reach for legislation to pursue collective goals”).
I’m willing to be a little more candid about the difficulty of changing attitudes. However, publicising these figures and openly questioning the way we behave seem the only way.

Tuesday, 10 August 2010

Two Arguments Against Libertarianism

I’ve begun to notice that a common theme running through many of my blogposts is the assumption that there should be redistribution of wealth from rich to poor through progressive taxation. I would hope that the idea that the government is a legitimate tool for social reform or that those with a greater capacity to shoulder the burden of taxation should take on a greater share of the burden is obvious. However, the existence of libertarianism suggests that these principles need some defence.
Libertarianism is a broad and complex philosophy, and I cannot hope to cover it in any depth here. However, its basic tenets are straightforward enough: the state ought to be reduced to a minimal role of providing public goods (such as roads) that are not efficiently produced by the free market, and of protecting its citizens from crime and invasion (see Andrew Sullivan for a succinct outline)
Libertarians (like most passionate believers in any cause) easily lapse into hyperbole. Robert Nozick famously likens progressive taxation to forced labour: if we are forced to give up, say, 40% of our income to the government, it is equivalent to spending 40% of our labour time working for other people. Most libertarians accept the need for a state of some sort, but wish it to be limited to its ‘necessary’ functions, and demand that it stay clear of ‘social engineering’. Progressive taxation imports illegitimate moral values to the state; the only way around this is to impose an equal tax burden on everybody.
This line of thinking leads to unpleasant conclusions, which is why most people reject libertarianism. Yet if we are to reject libertarianism we need to know why. Any competing philosophy must find a response to the challenge of libertarianism: they must justify why it is legitimate to take money against a person’s will to spend it in a way they do not approve. In other words, they must demonstrate how, if at all, progressive taxation differs from common theft.

I can see two types of response to the libertarian’s challenge. The first justifies a certain amount of redistribution of wealth as entailed by libertarian principles. The second challenges these principles head on.

Almost all libertarians agree that it is necessary to have a state, so as to protect citizens and enforce freely entered contracts (libertarians appear to love contracts). Most also agree that the state is required to intervene in the case of market failures, where goods are not efficiently supplied by the free market. However, both of these functions can be interpreted to call for a rather more extensive state than most libertarians envisage.
Take maintaining law and order: the obvious means of preventing crime is to provide a police force which enforces the law by punishing those that contravene it. But this is not the only possible strategy. Ensuring high levels of employment and education could reduce frustration and material need, and so reduce the motivation to commit crime. Indeed, direct redistribution, especially benefits to prevent destitution, performs the same purpose. It is not immediately obvious that ploughing lots of money into policing and prisons and doing little to try and forestall reoffending is a more efficient way to cut crime than focusing on education and benefits. And if redistribution or the extension of the state into education are in fact more efficient, surely that commits the libertarian to these policies. Otherwise, they are left proposing a supposedly minimal, but actually inefficient government.
Suppose now, that the hard-ass strategy is more efficient than the bleeding-heart one. But only just. Let’s say benefits and jobs and education can cut a similar amount of crime to greater enforcement at a cost of 50p more per taxpayer. Wouldn’t most, if not all, taxpayers be willing to pay just 50p extra for a positive government policy that preserves law and order by making people’s lives better? Presumably each person has a ‘carrot premium’ – the amount extra they are willing to pay for criminality to be deterred by carrot rather than stick. Whose carrot premium is the decisive one? The lowest? The median? I imagine the consistent libertarian would have to say the lowest, since that is the only way that the expansion of the state beyond minimal limits is unanimously supported.

All this is further complicated by the fact that in real life, the choices are rarely as simple as I’ve made them out to be. There are usually multiple questions, multiple answers, and no clear binary distinction between answers (e.g. it is unlikely all of the law and order budget would go on either policing or education). As the choices become more complex and specialised, it becomes impossible for citizens to represent their views directly. People need to be employed to study all the relevant options, and to make the equity/efficiency trade-offs that most, if not all would assent to. This necessitates the employment of a whole raft of politicians and civil servants I am sure the libertarians would rather we did without.

Nevertheless, it remains unclear how far this saves redistribution from the assault of the libertarians. It is highly likely that a certain degree of redistribution is justified in the interests of everybody in society. Yet this may not justify redistribution on the scale of the welfare state, and in any case, redistribution may not be the most efficient way of achieving the goals of the libertarian state.

A more aggressive tactic against libertarianism is to challenge the premises it rests on. One of the major attractions of libertarianism is that it appears not to depend on moral premises. This is why libertarians can affect to take such offense at the ‘moralising’ of justifying redistribution in the interests of justice. Andrew Sullivan claims he doesn’t “believe that having a heart is what government should be about”. Yet if libertarians were really morally indifferent, then surely there would be no difference between taxing the rich and not taxing the rich. ‘Taxation is theft’ is not a neutral observation, it is a condemnation, a call to arms. The fact that libertarians believe that certain things are illegitimate means that they must have some values.

The obvious candidate is freedom (the clue’s in the name). But if libertarians really care about liberty then they must see that redistributive taxation actually increases it. Nozick’s famous point about forced labour, about the inability to enjoy the whole fruit of our toil, makes the relevant point about the restriction of freedom. But this is only half the story. Our freedom is measured by the size of the full set of activities that are open to us. The limitations on these activities come from numerous sources, natural and social: I cannot fly unaided because of gravity, I cannot run 100 metres in 10 seconds because of the limitations of my body; I cannot buy a mansion because of my poverty, I cannot steal a car because of the law. Nozick correctly picks out the limitation of freedom imposed by tax law. Yet he neglects the extension of freedom of money to the poor. Moreover, it is almost certainly the case that the marginal cost of freedom is increasing. £10 to a starving person buys them basic nutrition, and all the opportunities that creates. £10 to a millionaire simply allows them to buy £10 of extra stuff.
Alternatively, the value that libertarianism is founded on could be a belief in the sanctity of property. What is wrong with redistribution on this account is that it fails to protect legitimately acquired and transferred property (see Nozick’s ‘Wilt Chamberlain’ argument). The libertarian fixation with property is a bit strange. Of all the competing moral principles that humans have proposed, the imperative of respecting the belongings of others is hardly the most compelling or inspiring. There are a number of different justifications for protecting private property. Extrinsic justifications tend to emphasise the significance of property for freedom or happiness. Yet if property is merely a means to one or other of these ends, we need to ask whether these ends would not be better served through redistribution of wealth. I have already argued that the marginal cost of freedom rises; I reckon much the same is true of happiness. This is why we get the economic phenomenon of ‘diminishing marginal utility’: every extra pound we earn adds slightly less to our total sum of happiness.
I am not sure whether property can be justified as having intrinsic value of its own. I think that Locke derived property rights from some sort of covenant with God, but that theory holds little appeal if you don’t believe in God or don’t agree with that interpretation of Man’s relationship with God. Also, Hegel says some stuff about how property confers identity because of our need to realise ourselves by acting on external objects. Like most things Hegel says, it’s pretty difficult to work out exactly what he means. However, I’m pretty sure that this doesn’t mean that the government taking away our money strips us of our identity. And even if it does, if money confers identity, then surely the poor have a claim to developing their own identity?

These are all preliminary and sketchy thoughts (backed by embarrassingly little research). I might well have misunderstood libertarianism. However, I think I’ve worked out this much: libertarianism, whatever it says, does stand for something: freedom, property etc. And whatever that something is, I think that libertarians have either got their priorities wrong, or are mistaken in how best to promote their values. And that, so far, is my response to the challenge of libertarianism.