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I'm reading Thomas Sowell's "Intellectuals and Society," and while I disagree with a lot in his arguments and his view of the world, I think he nails a key poin
by ellius 8y ago
I'm reading Thomas Sowell's "Intellectuals and Society," and while I disagree with a lot in his arguments and his view of the world, I think he nails a key point about the philosophy behind free market economies. He says that conservative intellectuals don't view inequality and other social tragedies as mainly the consequence of policy, but rather as an inherent part of the human condition. Markets may act as a mechanism that conveys those inequalities, but they are not necessarily their cause. Prices are his first example. Commanding a higher salary doesn't mean you're a harder or even more skilled worker, it just means that you produce something that is judged by buyers (employers) to have a higher positive impact on their well-being.
- closeparen 8y ago>Inequality and other social tragedies Poverty is a social tragedy. Inequality is an inevitable consequence of choice.
- ellius 8y agoPerhaps not a direct consequence of choice, though. Certainly whatever poltical and economic system we choose has implications for inequality, but it's not simply a matter of "we choose to have less inequality –> less inequality." Redistributive choices have complex interactions and results.
- _jal 8y agoRight. Intuitively, it is obvious that political choices impact inequality, as does perusing world data sorted by GINI coefficient, or even just a review of the US over time. I do find it darkly funny that so many folks seem to throw up their hands - it is obvious that inequality will always exist, so just live with however much we currently happen to have and shut up about it. (Inflation, however - we can totally micromanage that!) Humans have an innate sense of fairness that becomes offended at some point, and they start punishing even when doing so harms themselves. The peasants get restless at some point, the tumbrels come out, and there's your natural law in action.
- ellius 8y agoSure, people do that, but you're reading things into my post if you're implying that that attitude exists anywhere in it. I didn't say anything about throwing up our hands, and as far as I can tell neither does Sowell.
- _jal 8y agoApologies if I gave that impression - I wasn't trying to attribute that to you (or Sowell). Just riffing off your comment.
- golergka 8y agoSome people are more influenced by fairness. Some people are more influenced by their desire to compete and win. Both are built into humans. Don't judge the whole humanity by your personal temperament.
- _jal 8y agoIronic bit of advice there, given how personal you're making things. I'm talking about behavioral phenomena that's not even specific to humans. But since we seem to be advising each other, don't personalize things so much; the world's bigger than both of us.
- closeparen 8y agoWhat I mean by choice is that as long as people can make decisions that affect their outcomes, people will experience different outcomes.
- mpweiher 8y agoI read that less as "inequality is a choice", but rather as "if we allow choice, there will be inequality". So you can't easily choose to have less inequality, unless you also choose to eliminate almost all (other?) choice.
- closeparen 8y agoExactly what I meant. I mean, you could still permit some choices, but they couldn’t meaningfully influence outcomes.
- specialist 8y agoWhich choices lead to inequality, and by whom?
- closeparen 8y agoChoices about what profession or business to go into, whether to buy things and how much to pay for them, what goods/services to provide and how to provide them, etc.
- sooheon 8y agoOr choices about the socioeconomic status of your parents, or your intelligence, or the country you are born into, etc. There is nothing unjust about inequality, because in a free market universe, everything is a choice and being left holding the shorter straw is due to your choices.
- closeparen 8y agoSure, a variety of factors lead to inequality, some of them unjust. It is those unjust factors, not the inequality itself, that must be eliminated.
- golergka 8y ago"Justice" is the ultimate social construct – that everybody constructs to his or her needs.
- sampl 8y agoFunny, I was just reading that same example of his in his book “basic economics”, and it makes sense. Still, couldn’t you say the same for a feudal structure? That nature has power imbalances, and the role of king only conveys that inequality? Instead, we’ve intentionally built a more egalitarian system (and we’ve all prospered because of it), seemingly against nature.
- ellius 8y agoThat's kind of his point though: that we have managed to get this far, but we shouldn't take it for granted and expect that we can just "turn up the equality dial" and get more equality. These are complex systems and barbarism is always at the gate, because that's the default state. It's not that equality isn't a laudable goal or worth pursuing, it's that it's an extremely hard goal that must be approached thoughtfully and often indirectly.
- sampl 8y agoInteresting point, and well put--thanks. Maybe there's a distinction to be drawn between "inherent part of the human condition" and the "default state", as you have described it. Attempting to change something "inherent" seems worthless, but default is merely waiting to be overwritten with something better. For ex: death is inherent in the human condition, we cannot avoid it and must deal with it. Nakedness is only the default state, and is pretty easily solved. Back to economics: maybe scarcity is inherent, but "social tragedy" may be merely a very solvable default.
- TeMPOraL 8y agoNot the best example :). Death seems inherent on the timescales of the lifetime of the universe, but on our timescales, it's merely a default. There's nothing in physics or biology saying we can't solve that; it's just an extremely difficult challenge that we didn't solve yet. I mention it because if we classify it as default, not inherent, it means we can and should be doing something about it. But keeping appropriate timescales in mind, I agree with the conclusion - for given constraints, there are things that are inherent and not worth attacking, and then defaults that are merely attractors for the system state.
- jadedhacker 8y agoThis is far too celebratory of markets. Markets pay for things that people of means want. If I make a useless toy that delights a rich person I am paid lavishly. If I make a useless toy that delights a poor person I get next to nothing.
- ellius 8y agoI didn't "celebrate" them at all, I just said that in a market system a purchaser of labor pays more when they determine some skill is worth more to them than another skill.
- pdonis 8y ago> Markets pay for things that people of means want. No, markets pay for things that are worth more than it costs to make them. Only a very small fraction of those things are useless toys that delight rich people.
- bobthepanda 8y agoThis is a bit of hyperbole; desire and need are direct contributors to "worth" because you can extract more profit for it. That being said, profit is a notoriously crude way of measuring utility, given that a lot of tragedy-of-the-commons type problems don't have "profitable" solutions without some type of government intervention. (See: pollution, public education and health, childcare, working week limits, etc.)
- pdonis 8y ago> profit is a notoriously crude way of measuring utility There are no non-crude ways of measuring utility among different people with different, often incompatible, preferences. > a lot of tragedy-of-the-commons type problems don't have "profitable" solutions without some type of government intervention. They also don't have good solutions with government intervention, because the downsides of government intervention (regulatory capture, increasing power of the state, micromanagement of all aspects of people's lives, political power being used to benefit some instead of all) more than outweigh any increased benefit in a particular area.
- petra 8y agoIn the past, the ancient past, a great actor would have gotten a measly salary. Today, Some actors(not necessarily the good ones), get lucky and become filthy rich. So is their luck an inherent part of the human condition ? or is it the result of technology, TV/Cinema ? And do we have a right, as a society, to choose how technology will shape us, or not ?
- sorokod 8y agoit just means that you produce something that is judged by buyers (employers) to have a higher positive impact on their well-being My partner is a nurse, she gets payed peanuts while daily ensuring that people don't die. Literally. What judgment exactly is exercised to have life saving jobs be payed order of magnitude less than "plumbing" jobs? The argument of "higher positive impact on their well-being" is laughably naive.
- golergka 8y agoSupply.
- sorokod 8y agoYou are wrong - the supply of corporate software developers outstrips the supply if qualified nurses - in London at least.
- golergka 8y agoThen it smells like an ineffective market, compared to software development. Let me guess, which one has more red tape, regulation and government involvement?
- sorokod 8y agoIt's always those pesky free market saboteurs isn't it? Consider this - it takes years of formal training to produce a qualified medical professional and pretty much nothing to produce a software developer.
- pkaye 8y agoDoesn't the government set the rates for nurses in the UK? Also you need to compare the supply to the demand. Perhaps more software developers are needed than nurses.
- yadaeno 8y agoThe utility of the software engineer scales with the number of people using software vs the number of patients for the nurse. If the software engineer is able to provide more utility, this roughly translates to more demand which means higher salary which means higher supply
- swifting 8y agoIf you’re reading Sowell. I would recommend Wealth, Poverty and Politics. :)