Moral Hazard and International Aid

Approaches to global justice like Nussbaum's are simply inadequate until they can seriously address the problems of moral hazard that seem to me to utterly swamp considerations in favor of large-scale global redistribution. This simply recapitulates the moral hazard argument against certain forms of welfare programs at the domestic level. The best work on this is David Schmidtz's writings on “Guarantees.” Nussbaum is very cavalier in her talk about “entitlements.” She needs to address Schmidtz's argument that we need to not be guaranteed all that we need in order to even begin to approach an answer to Peter Bauer.
Nussbaum is also facile about institutions:
The third of Nussbaum's Ten Principles for the Global Structure is: “Prosperous Nations Have a Responsibility to Give a Substantial Portion of their GDP to Poorer Nations.”
Well, OK. Earlier, with regard to institutions, she says:

In the domestic case, we can easily say quite a lot about what institutions bear the burden of supporting the capabilities of the nation's citizens: the structure of institutions laid out in the nation's constitution, together with the set of entitlements prescribed in the constitution itself. This structure will include legislature, courts, administration and at least some administrative agencies, laws defining the institution of the family and allocating privileges to its members, the system of taxation and welfare, the overall structure of the economic system, the criminal justice system, etc.

The difficulty is that almost no amount of money does much good unless domestic institutions are robust enough to actually facilitate their citizens' “entitlements.” Clearly, citizens of rich countries have reason to reject policies that throw their money down a hole. And how do you build minimally acceptable institutions? Well, that's the problem folks like Mercatus's Global Prosperity Initiative work on, and it's hard. GPI isn't very sanguine about the effectiveness of aid in the absence of certain institutional prerequisites. (Check out the critical public interest comment on the Millenium Challenge Account.)
So what is Nussbaum even saying? We already know that most aid is ineffective, and that there is no good reason to believe that more aid will be significantly more effective in the absence of deep institutional reform. And deep institutional reform cannot simply be bought or willed into existence, but, barring colonization, must generally emerge from within? So what is that bigger chunk of our GDP supposed to be doing?
It's not at all clear to me that Nussbaum even has a positive argument for her prescriptions. She strikes me as offering little more than a set of normatively toothless utopian aspirations.

Author: Will Wilkinson

Vice President for Research at the Niskanen Center

7 thoughts

  1. That picture reminds me of one of the irritating traditions New York has come to embrace, and one which I am happy to have left behind … CRITICAL MASS!!! In case you haven’t heard of this, it is a day (a holiday, if you will), when all of NYC’s self-righteous bicyclists get together and bike up and down the length and width, every which way of the city’s boroughs. The idea is that so many accumulate that they stop motor traffic from proceeding in a virtual deadlock, and they widely disregard any and all traffic laws. We all knew not to drive (or attempt to even walk) on that day. It amounted to nothing more than countless hipster Luddites standing athwart commuters, shouting “Nannie-nannie-pooh-pooooh!” Now I’m all for spontaneously organizing anarchy, and all that noise, but it’s a different story when I’ve got to sit in my car for about a half an hour at a light in otherwise light traffic because some Williamsburg graphic designer wants an interesting story to tell on his website.

  2. So lawlessness is the proof for lawlessness? That’s intellectually lazy, and has no merits in any grounds of Libertarianism.
    Let’s go through your weak (pathetic?) attempt to justify your breaking the law everyday on your bike:
    – Speed Limit: I follow it, it saves me gas and prevents tickets
    – Turn signals: I use them on all lane changes
    – Right on red: Only when legal
    – Double parking: Never
    – Jaywalking: Not in the last 30 days
    How about you? Does your illegality make anyone else not following the law more acceptable? Logically, I should shoot someone on the streets if someone else does it, after all, one crime is equal to another similar crime, therefore we shouldn’t follow the law. (your logic, not mine)

  3. God you people are assholes. It’s like he said, “I had a spliff last night” and y’all cry “I hope you fucking die face down in a puddle from an overdose after a drugdealer assrapes you you fucking lawbreaking scumbucket. Because, you know, MJ is not LEGAL, which is like the end all and be all of every fucking thing, isn’t it? Fuck all of you fucking coplickers in your diamond-manufacturing recta. So you never smoked a joint or jaywalked or pissed in an alley. Your holiness fucking humbles us all.

  4. I’m with you until you bring up double parkers. They’re the worst of the worst, and I refuse to believe that they’re making an honest evaluation of the possible effects of their actions. Them folk need shot.

  5. Ahh, double parking. The mark of latte-grabbing jerks the world over. (No offense to the latte-grabbers who may administer this blog, of course.) And in that vein…
    It has long struck me as odd that we largely decline to regulate one of the transgressions with the most consquences for the most people: late merging. I’m talking about those who race up to the front of a slow traffic line to cut in, apparently oblivious — or indifferent — to the fact that it’s the likes of they who make the whole thing long and slow to begin with.
    Ugh. It’s infuriating just typing about it.

  6. If you aren’t deliberately provoking people, Will, I’ll explain. There are situations where scoffing at the law is more rational on an actuarial basis than others. I could explain to you why you’re putting yourself at greater risk by doing some of the things you say you are doing than I do if I go 10 mph over the limit on most roads, but I think it would be wasted.
    It would make little difference to me but for the fact that people like you (1) scare the bejesus out of me when I come within a hair of killing you; (2) you disrupt traffic; and (3) sue no matter how at fault you are in your injury. The sense of entitlement and victimhood of bicyclists add salt to the wound.
    A guy like you runs a red light–if there is oncoming traffic, and both you and the drivers are lucky–they stop or slow down. You show up early–wonderful! I slow up and miss a light and show up LATE. In order for you to show up 30 seconds early, I and every other driver who missed the light show up 5 minutes later. At that point, you’ve FUCKED US DRY AND WITHOUT A RUBBER.
    Cyclists have so convinced themselves of their righteousness that they go beyond entitlement–Critical Mass riders are bullies disguised as do-gooders. I have been stuck in a crowd of these motherfuckers and I think I burst a bunch of blood vessels not plowing through them.

  7. Montreal is a city that takes pride in its jaywalking ways. In my time walking there, I have never looked at a traffic light as anything more than a suggestion to pay a bit more attention when crossing the street.
    I remember a bit from a course at the Architecture School at McGill that came up with a perfectly rational explanation for this pedestrian “anarchism”: in downtown Mtl. the width of east-west blocks times the average walking speed of an average adult equals the traffic light timing cycle. If you obey the law you always hit red when you come to the corner, therefore the system is against you, ergo screw the system.
    I have never received a jaywalking ticket (unlike say Harorld Lee), and haven’t heard of anyone who has. I assume this behaviour against some piece of legislation, but it is the basic law of walking. Just do it.

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