Friday, November 07, 2008

Liberaltarians and Inequality

I attended an interesting panel discussion a couple of weeks ago, titled "Liberals and Libertarians: Common Ground or Separate Agendas?" Reason magazine has a good write-up of the discussion here. I especially enjoyed hearing from blog-famous Jacob T. Levy and Will Wilkinson, the latter of whom discussed what he calls the leftist's "Inequality Road to Serfdom" argument:
According to IRS, the wealthy convert their economic resources into political resources deployed to protect their advantages. Past a certain threshold of inequality, the gap in political resources is so vast that the wealthy–by means of insidious think tanks and the Republican Party–basically capture the democratic process and effectively disenfranchise the rest of the population, leaving us with a de facto oligarchy hiding inside a meaningless husk of democratic forms. Serfdom!

Will pointed out that the empirical premise here seems questionable. Plenty of rich people vote Democrat, precisely because they are so materially secure that they prioritize their (typically socially liberal) values instead.

[This doesn't touch on the more serious problem of post-election corruption / regulatory capture. But there I guess the problem is not inequality per se, but the way that flows of money shape the legislative process. So the solution is to reform the political process, not limit wealth inequalities.]

We should of course provide a 'safety net' (e.g. a basic income guarantee). But I don't see such a need for a wealth ceiling.

2 comments:

  1. Did Will give any numbers to support his claim? A couple of minutes of googling suggests that he's wrong.

    For instance:
    http://www.opensecrets.org/pres08/donordems.php?sortby=X

    I'm a little lost on the precise details on that page (are the dollar amounts the minimum such people donated, or the maximum?), but the general message is clear: The lowest sized donations made up around half of Obama's intake, against a third of McCain's, and the largest sized donations made up around a tenth of Obama's intake, against nearly a fifth of McCain's. That seems to support the view that McCain is supported by fewer but far richer people than Obama.

    Those numbers are for individuals. I assume that matters will be worse still for Will's view if I could find some numbers on corporate donations. Likewise for think tank funding.

    As I say, this was from a couple of minutes of searching, so perhaps I'm missing something.

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  2. The ratios are misleading because Obama raised so much more (i.e. from everyone). If you look at the raw frequency values on that page, you see Obama had twice as many 'maxed out' donors as McCain.

    Will recently linked to this wsj report, but I don't recall what (if any) empirics were included in his talk.

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