Comments on: The Argument for Preemptive Redistribution

By: John Humphreys

John Humphreys — Mon, 18 Aug 2008 14:59:33 +0000

Rational self-interest has never meant simply maximising material wealth. Homo Economicus is a utility maximiser… not a money maximiser. This is fairly basic economics.

By: John Humphreys

John Humphreys — Mon, 18 Aug 2008 07:59:33 +0000

Rational self-interest has never meant simply maximising material wealth. Homo Economicus is a utility maximiser… not a money maximiser. This is fairly basic economics.

By: Julian Fondren

Julian Fondren — Mon, 21 Jul 2008 07:26:00 +0000

Who Captures Whom? discusses the capture of private industry by government.

By: izforever

izforever — Sat, 19 Jul 2008 19:11:27 +0000

more power the government has to pick winners and losers, the more power rich people will have relative to poor people.

That's a faith-based belief--rooted, I think, in a hermetic theology--not a fact. To the extent that the winners that the government picks are poor people, it's a false belief.

The incentive to capture is a function of the value of the thing captured, not of the the means to do it.

The assumption here is that government is a single "thing" there for the capture. Not the case. Defense dollars, for instance, are wildly subject to capture by the rich. EITC and ADC dollars are decidedly not.

By: Jason Armstrong

Jason Armstrong — Sat, 19 Jul 2008 00:32:57 +0000

It is too bad every other society besides Denmark is heterogeneous. If they were all homogeneous, like Denmark, we might be able to deduce some general principles that would apply to them.

By: John V

John V — Fri, 18 Jul 2008 18:58:36 +0000

Muirgeo,

How do you continually see the real logic of people like WIll, Boudreaux, Russ Roberts (and me and others on this site) right in front of your face and then continually let it pass right over your head?

It's almost comical.

Consider WW in this very posting:

Why not suppose instead that when taxes on the wealthy rise, the wealthy become more interested in controlling the government?

None of this not to say that various individuals and corporate interests do not try their damndest to use the government to enrich themselves; they most certainly do.

...rent-seeking is a largely a zero-sum game that puts some rich people at odds with other rich people (and the rest of us). The billionaires...are trying to put other billionaires out of business. Etc....

The straightforward implication is that the more power the government has to pick winners and losers, the more power rich people will have relative to poor people. The incentive to capture is a function of the value of the thing captured, not of the the means to do it.

That last bold quote is the bottom line of the causal paradigm...yet you never address it. WHY? (if you respond to this, please answer that question at the very least.)

The way you say things, this construct seems to totally escape you.

Look at what you present...the Great Depression, bailouts, Wall St.

None of these things are really the same thing as what Will is talking about.

Moreover, as far as those things are concerned, sometimes it's really just a matter of the government provoking bad results from bad policy:

Cheap credit is double edged sword. And bad Fed policy is not always crafted with the rich in mind. Sometimes, it's just bad and when it is, it can create problems that would never get baseless calls for some kind of generic legislation if the bad policy to didn't provoke dangerous behavior in the first place.

By: GilM

GilM — Fri, 18 Jul 2008 14:40:55 +0000

And, after we eliminate wealth advantages to capture government power, we need to start going after the well-spoken and large cooperative organizations with policy goals. These have unfair advantages and unequal influence as well. It won't be fair until everybody is equally poor, silent and isolated.

What we can never do is to question the value of the state powers that incentivize the capture. That's crazy talk!

By: Will Wilkinson

Will Wilkinson — Fri, 18 Jul 2008 14:27:53 +0000

I think I'll add three more.

By: GilM

GilM — Fri, 18 Jul 2008 14:26:59 +0000

"None of this not to say that various individuals and corporate interests do not try their damndest to use the government to enrich themselves; they most certainly do."

I'm pretty sure this says the opposite of what you meant.

Maybe you should add another negative!

By: Will Wilkinson

Will Wilkinson — Fri, 18 Jul 2008 13:11:18 +0000

metaandmeta, I don't know of any good indices for this kind of thing. Probably indices of corruption would be a decent enought proxy. And the wealthy high-inequality countries, like UK, US, and Singapore, score pretty low (although the Singapore state HAS been captured by elites — in this case, it has turned out good for average economic well-being.)

That said, there is SURELY a correlation between inequality and capture, since capture tends to produce inequality. But the direction of causation is what's at issue here. Cross-nationally, inequality is correlated with lots of terrible things, but that's because mechanisms that produce inequality, like political predation, also cause poverty and social instability. So the mechanism is key.