Clarity on How to Justify Economic Systems

Alexander writes:

Based on Z&T’s first article it seems as though there are five potential criteria for moral justification of an economic system other than one based strictly on deontic rights protection:

1. The system delivers the greatest payout to most well-off in society.

2. The system delivers the greatest payout to the average members in society

3. The system delivers the greatest payout to the least well-off in society

4. The system delivers the greatest payout to everyone in society (i.e. including the least, average, and most well-off) …”

I do not know what either #2 or #4 is supposed to mean.

In #2, does “average members” mean “median members”? If so, neither I nor anybody else I have ever heard of advocates that criterion. If, on the other hand, what it means is “the greatest payout, averaged over all members of society,” then it corresponds to one version of utilitarianism (assuming “payout” means “utility”), but his later claim that #2 is consistent with “the moral justification of free market institutions is logically independent from any claims about the effects of those institutions on the material holdings of the poor” is false, since the poor go into the average along with everyone else.

Does #4 mean “every single person in the society is better under the system than under any other system?” If so, it is unlikely that any system would satisfy it. The only other sense I can make of it is that it means “the greatest payout averaged over everyone in the society,” in which case we are back with utilitarianism and the more reasonable interpretation of #2.

As far as I can tell, either two of his criteria are identical or one, at least, makes no sense and corresponds to nothing anyone here or elsewhere is arguing for.

Alexander goes on to write “David Friedman seems to be advocating #2 with his defense of utilitarianism.”

I am not defending utilitarianism, as ought to be obvious from my earlier post—if I were, I would have to hold that the society (or act or rule) that resulted in more utility was always better. I am arguing that, insofar as something beyond respect for rights ought to be included in the views of libertarians, that something looks more like utilitarianism than like social justice.

Like Alexander, I too “am interested in asking Z&T to clarify which of these standards they think is most appropriate for evaluating an economic system. Do they want to argue that we must give greater moral weight the least well-off or do they want to argue that we should treat everyone with equal moral weight, which includes the least-well off?” I asked earlier what “social” adds to “justice,” and I do not think I have yet gotten an answer.

Also from this issue

Lead Essay

  • Matt Zwolinski and John Tomasi propose to refocus the libertarian movement. Although they agree that individual property rights are important, they propose to return libertarianism to its nineteenth-century intellectual roots. They argue that the classical liberals valued property rights for different reasons, perhaps, than we in the movement value them now: Property rights were intended to protect the least well-off workers in society. A “neoclassical liberal” would not advocate a welfare state, but would certainly value social justice; his means of attaining it would be through the institutions of property and contract.

Response Essays

  • Roderick T. Long criticizes the sharp distinctions drawn by Zwolinski and Tomasi between nineteenth-century classical liberals and the “Unholy Trinity” of Mises, Rand, and Rothbard. He suggests many areas in which the earlier thinkers were not as Zwolinski and Tomasi characterize them, as well as several where Mises, Rand, and Rothbard don’t conform either. Long stresses the importance of class analysis in the thought of nineteenth-century classical liberals and points to its resurrection as a key aspect of Rothbard’s thought in particular. This, he suggests, points the way toward a “bleeding-heart absolutism” – an ideology critical of every form of state power, yet also prioritizing the moral claims of the poorest in society.

  • David Friedman argues that the pre-twentieth century classical liberals were motivated not by a concern for the poor per se, but by utilitarian reasoning. The “working poor” were a large majority of society in their time, and authors like Adam Smith must be read in their historical context. Doing so reveals Smith to be a progenitor of Jeremy Bentham, not John Rawls. Utilitarianism brings problems of its own, of course, but it should not be confused with social justice.

  • Alexander McCobin argues that libertarians often engage in unproductive debates about who or what is “more” libertarian. One thing lost in these debates is that, across the wide sweep of intellectual history, significant libertarian figures have usually felt free to draw from a wide array of justifications and policy approaches. Each was a product of a particular historical era, and there is no reason to find fault with any of them simply on that account. To advance liberty, we should think and write about libertarian principles in terms that unbiased observers will find persuasive today.