Justification of equality: equalitarian ends by unequalitarian means? Great inequality in the right to decide such issues and choose such means?

If one is concerned with equality, then one should also be very, very concerned with equality of power.

Would the power to create equality require inequality of power? Equality is achieved via inequality? Would it be that those with a zest for equality fail to see the inequality of means to achieve such equality? -Or- are those with a zest for equality, in essence, merely transposing inequalities?

　

“The two visions entail very different views of the relationship between members of the existing society. The unconstrained vision has tended historically toward creating more equalized economic and social conditions in society, even if the means chosen imply great inequality in the right to decide such issues and choose such means. Clearly, only very unequal intellectual and moral standing could justify having equality imposed, whether the people want it or not, as Dworkin suggests, and only very unequal power would make it possible. It is consistent for the unconstrained vision to promote equalitarian ends by unequalitarian means, given the great difference between those whom Mill called “wisest and best” and those that have not yet reached that intellectual and moral level.

Conversely, those with the constrained vision have tended to be less concerned with promoting economic and social equality, but more concerned with the dangers of an inequality of power, producing and articulate ruling elite of rationalists. In Hayek’s words:

The most dangerous state in the growth of civilization may well be that in which man has come to regard all these beliefs as superstitions and refuses to accept or to submit to anything which he does not rationally understand. The rationalist whose reason is not sufficient to teach him those limitations of the power of conscious reason, and who despises all the institutions and customs which have not been consciously designed, would thus become the destroyer of the civilization built upon them.” (1) (2)


Which then leads to this observation :


“This way lies charlatanism and worse. To act on the belief that we possess the knowledge and the power which enable us to shape the processes of society entirely to our liking, knowledge which in fact we do not possess, is likely to make us do much harm.

But in the social field the erroneous belief that the exercise of some power would have beneficial consequences is likely to lead to a new power to coerce other men being conferred on some authority. Even if such power is not in itself bad, its exercise is likely to impede the functioning of those spontaneous ordering forces by which, without understanding them, man is in fact so largely assisted in the pursuit of his aims.” - F.A. Hayek, from the essay The Pretense of Knowledge


Which lends itself to this observation:

　

[Paraphrasing] In a consciously planned economy equality of income becomes an income redistribution scheme. Once the centrally planned economy fails, the justification for the continuation of the centrally planned economy becomes equality of income. -Thomas Sowell


Notes:

(1) Thomas Sowell, A Conflict of Visions: Ideological Origins of Political Struggles, 2007 edition, page 55.

(2) F.A. Hayek, The Counter-Revolution of Science: Studies on the Abuses of Reason, 1979, pp, 162-163

Thomas Sowell - A Conflict of Visions

Elitists

In political discourse you will see a reference to “elitists”. Generally the term elitists is used to designate the few somehow, someway enlighten individuals of the political, intellectual, or academic
classes who’s particular vision of society is somehow, some way more enlightened than the vision of others.

Some award the political term of “elitist” to Karl Rove. (1) However, Rove by no means was the first to refer to the label elitist. Milton Friedman referred to an “elite class” when discussing the emergence of the modern welfare state in his classic 1979 book Free to Choose. (2) Whereas
others argue the elitist label is merely anti-intellectual.  That is, people use the term in the positive
or negative. (3)

Is there a better definition, less political /more empirical, more thoroughly researched definition of “elitist”? Yes there is such an animal. Its most likely related to Thomas Sowell’s definition of
“special knowledge” as it appears in Sowell’s books A Conflict of Visions and Intellectuals and Society.

The term “special knowledge” as used by Sowell appears related to F.A. Hayek’s discussion of central planning and the inability of any one individual to have enough information to organize economic activity and associated outcomes.

F.A. Hayek’s discussion of decentralized knowledge trumping centralized knowledge is nicely summed up by Harold Demsetz as follows:

“…the historically important central puzzle of economics was to explain how independently acting people in an unplanned decentralized, private ownership economic system allocate their resources and, in particular, to explain how it is that the uses they seem to make of resources seem to be
well coordinated”.(4)

What is “special knowledge”?

An expert might be categorized as someone who is perceived to have acquired the most knowledge in one particular field of study such as geology or mathematics. Moreover, other participants within a particular field of study consider a particular person as an expert in the field of study. “Special knowledge” is when one leaves his/her particular field of expertise and acquires a self-designated position as an intellectual.

The self-designated and self-appointed intellectual designation is an attempt to transfer particular expert knowledge from an unrelated field to another field and instantaneously acquire “special knowledge” in a completely unrelated or mildly related field of study.

Special knowledge, the self-appointed intellectual, and political-economy?

Most notably, as pointed out by Rove, Friedman, and Sowell, the self-appointed intellectual , the elite as it were, want to comment and shape opinion specifically in the field of political-economy. For example, Paul Krugman trying to transfer his expertise in trade economics to political-economy commentary on society as a whole. Bill Gates trying to transfer his expertise in the field of computers to political-economy commentary on society as a whole. Barack Obama trying to transfer his expertise as a community organizer to political-economy commentary on society as a whole.

The once expert in a particular field, now a self-appointed intellectual in an unrelated field, has somehow, someway acquired “special knowledge” in the unrelated field. That is, the expert knowledge in a particular field becomes “special knowledge” in an unrelated field. Hence
“special knowledge” is merely notional propositions of the way things ought to be of a particular self-appointed intellectual with the premise being that an expert in one field is surely an expert in an additional field, that being most notably the political-economy.

Elites as the self-appointed intellectual?

Hence the definition of “elitist” as merely anti-intellectual misses the mark. It’s not that an elitist is anti-intellectual; it’s that an elitist is a self-appointed intellectual making political-economy
commentary on society as a whole through use of special knowledge which is in fact no knowledge. That is to say, we have a group of people, self-appointed people that have no expert knowledge in the field of political-economy, making notional statements which are in fact statements of “the way things ought to be”. That is, an elitist is a non-expert, making notional comments and putting forth
the notional propositions as fact, when the actual case is the notional propositions are merely their particular non-expert view of the way things ought to be and hence painting the world in one’s own self-image or self-vision.

(1)http://www.associatedcontent.com/article/1031684/elites_elitists_and_rove_politics.html?cat=9

(2) Free to Choose, 1979, Milton Friedman, chapter four,
page 98

(3) http://www.newsandsentinel.com/page/mboard.detail/fNav/71/What-does-the-term--elitist--rea---.html

(4) From Economic Man to Economic System, Harold Demsetz.

ObamaCare: the repeal of first stage economic thinking

The government solution to a problem is usually as bad as the problem. - Milton Friedman

Thomas Sowell has written extensively that politicos have a short political time horizon i.e. the next election cycle. Politicos then match their short term political time horizon to first stage economic effects of policy proposals. Matter-of-fact, Sowell wrote an entire book regrading first stage economic thinking entitled Applied Economics, thinking beyond stage one. (1)


Government solutions and the ObamaCare Repeal vote Wednesday 01/19/2011

The vote next week to repeal ObamaCare is odd out. That is, Friedman's advice is coming home to roost. Politicos always cave-in or never can quite muster a vote on the concept: "The Government solution to the problem is usually as bad as the problem". Never quite bring ourselves to test Friedman's quote. Ah, but the evil of it all.....next Wednesday Friedman is coming to bat.

Political time horizons and first stage economic consequences

Friedman's observation above and Sowell's "thinking beyond stage one" are worth considering regarding ObamaCare and much legislation in general. The basic premise is that legislation can have immediate economic consequences that are favorable. This short term favorable economic consequence matches the short term political time horizon of politicos. However, the exact same legislation has long term unfavorable economic consequences (known-knowns) as well as long term cascading unintended economic consequences (known-unknowns).

The long term economic consequences of legislation is not a concern of politicos as their focus is on a short term political time horizon i.e. next election. Hence legislation becomes a tool to create first stage favorable economic consequences to match a short term political time horizon. The problem immediately arises that legislation in fact creates long term economic consequences. These long term consequences are what James and Jane Goodfellow, their children, grand children, and so on must live with for years and decades to come. The Politico on the other hand merely wants to win the next election.

Therefore we have policy making politicos of the short term world creating long term economic consequences for the long term world that James and Jane Goodfellow live within. Real life examples abound. Social Security had major short term favorable economic consequences and hence matched the short term political time horizon of legislators of the time. Decades later James and Jane Goodfellow find that the unfunded future liabilities of Social Security are daunting. Merely take the term Social Security in the prior sentence and plug in Medicare, Medicaid, welfare, food stamps, public sector pensions, etc., etc.. The legislation created short term favorable economic consequences followed by cascading unintended economic consequences.

Behind the curve, ahead of the curve, and the 70 year dream

An odd out item with ObamaCare aka socialized medicine is that certain political groups have been pushing for socialized medicine for decades and decades stretching back at least seventy years. The socialized medicine scheme, when debated in 2009 and 2010, was referred to as a "dream" by proponents. A seventy year old dream.

Exactly what grand scheme had been developed and tested during these seventy years of dreaming? If one wants an item for seventy years wouldn't one have developed a comprehensive plan with details? Apparently not. In essence seventy years of a dream of socialized medicine was kept right in the dream world with nothing more developed than a fuzzy theme with no plan. For a group that wants to rely so heavily on government central planning it seems odd that for seventy years they forgot to develop a central plan. You might say proponents were/are seventy years behind the curve as ObamaCare was/is a cobbled together plan that boils down to a scheme of centralized price fixing. Problem is: central planning fails miserably and price fixing schemes have never worked in all of economic history. (2) (3) Brilliant! A failed delivery system delivering a known failed result!

However, there appears to be a vast majority of James and Jane Goodfellows that have looked ahead of the curve. You might even say, that for once, politicos have been caught with their hands in the short term political time horizon cookie jar. One might even speculate that James and Jane Goodfellows have come to the point of clearly understanding and adopting the classic essay by William Graham Sumner "The Forgotten Man". That is, the Goodfellows clearly understand they have in fact become the Forgotten Man: "He is the victim of the reformer, social speculator and philanthropist, and I hope to show you before I get through that he deserves your notice both for his character and for the many burdens which are laid upon him". (4)

So many social insurance and social welfare plans have exposed themselves as failures. That their long term economic consequences and cascading unintended economic consequences are failures for all to see. That massive hulking failures such as Social Security, Medicaid, and Medicare, have shown the public that long term dire consequences await them and their children. That the dreams of certain politicos become nightmares of the first order.



Behind the curve, politico's political time horizon, and a failed delivery system with known failed results.

The repeal vote, which is a vote on HR 2, becomes an affront to proponents of ObamaCare. How could anyone want to repeal a dream they have held for 70 years? A dream that in their view has become a reality.

The repeal vote is more reality than dream. The seventy year dream was really a theme with no plan. Then the plan was cobbled together based on politico's using first stage economic thinking to match their political time horizon. With the entire plan based on using a failed delivery system with known failed results. The problem is that the plan does not even have first stage favorable economic consequences. That the plan right out of the gate failed. Hence a cobbled together plan that was suppose to have, at the very least, first stage favorable economic consequences became an immediate cascading unintended economic consequence nightmare. That is, the politico's that are proponents of ObamaCare were so silly as to produce a plan that doesn't even create the illusion of favorable results to match their very own short term political time horizon. In other words, proponents of ObamaCare by their very own design produced the stage, set the stage, and generated the momentum for the repeal vote.

Collectivism's long history of failure

One only needs to examine history to see how collectivist plans fail. First we have the dawn of recorded history up to the Agricultural Revolution that was century-in, century-out of collectivism. Yes, collectivism is the oldest of economic systems. The results of collectivism up to the agricultural revolution was that mankind lived in an environment of constant starvation. Life was basic subsistence. Basic subsistence handed down from one generation to the next.

Collectivism's results were so poor that Malthus developed his theory of the Malthusian Population Trap. That mankind was stuck in a perpetual environment of basic subsistence and starvation as population was growing faster than food production. That mankind was stuck in a never ending battle to merely sustain life.

What changed the Malthusian Population Trap? The advent of private property agriculture in the Agricultural Revolution. Private property farming suddenly produced abundance in agriculture and man could for the first time feed himself. Out with Malthus in with abundance. (5)

Along the way private property, private property rights, and the price system developed. Note that private property, private property rights, and the price system "developed". That is, no central authority decided upon private property, private property rights, and the price system. Mankind merely stumbled into the systems. The systems occurred due to decentralized means. (6)

A basic premise should appear very quickly to the reader: decentralization created abundance and collective centralized planning created never ending subsistence results.

A major source of objection to a free economy is precisely that it ... gives people what they want instead of what a particular group thinks they ought to want. Underlying most arguments against the free market is a lack of belief in freedom itself. - Milton Friedman

If collectivism is a failure why do collectivist propositions such as ObamaCare continue to be proposed?

The answer goes back to the constrained vision of mankind and the unconstrained vision of mankind.
The unconstrained vision of mankind, held by most collectivists, is that the nature of mankind can be changed, improved, and molded only by institutions of state. That a central authority [state] through governmental institutions is the only way to improve the nature of mankind.(7)


A review of the basis for repeal and first stage economic thinking

Prior to the repeal vote next week its likely a good idea to review the laundry list of basic errors within ObamaCare. Although this is not a complete list it should suffice to say that the problems are those of a plan doomed to fail:


(1) Federal bureaucrats overriding state rights and circumnavigating the McCarran-Ferguson act.
(2) The demise of consumer directed health-care.
(3) ObamaCare purposely designed to collapse into a single payer system.
(4) Another unsustainable entitlement atop of current unsustainable entitlements.
(5) A central planning scheme that is a known failed delivery system.
(6) A plan based on price fixing that results in quantitative and qualitative reduction in supply aka rationing.
(7) Ultimate third party decisions removing consumer choice.
(8) An unconstitutional individual mandate.
(9) The error of categorical risk management.
(10) A plan based on reverse risk management.
(11) A plan that fails to address let alone bend the cost curve.
(12) A plan that is based on the fallacy of universal coverage as universal coverage does not mean universal access and access will deteriorate.
(13) A plan with massive administration needs at a massive price.
(14) A plan that fails to address the allocation of scarce resources with alternative uses.
(15) A plan that fails the risk management matrix which is an axiom of insurance theory.
(16) Shifting costs to states in the form of massive increases in Medicaid that will bankrupt already stained state budgets.
(17) Massive tax increases.
(18) Lose of individual freedom.
(19) Add your basis for repeal here ---> ________.

Also, one sometimes will refuse to let issues stay settled by the adverse decision of such a procedure, specifically when the wrong decision is worse even than the disruption and costs of refusing to accept it, when the wrong decision is worse than conflict with those on the other side. - Robert Nozick

Summary

If one wishes to reform, improve, stream line, create more efficiency, allow for freedom of choice, reduce costs then ObamaCare needs scrapped. The ObamaCare plan has so many built-in failures that beginning anew is the only course of action. Ford once built the Edsel and they scrapped it. Howard Hughes built the H-4 (The Spruce Goose) and he scrapped it. There comes that point that a failed plan needs scrapped and a new course of action is desirable.


Notes


(1) Applied Economics, Thinking Beyond Stage one, Thomas Sowell.

(2)At 35, Nixon freeze still chilling, William Neikirk, The Swamp. http://www.swamppolitics.com/news/politics/blog/2006/08/at_35_nixon_freeze_still_chill.html

(3) Nixon, Price Controls, and the Gold Standard, excerpt from Commanding Heights by Daniel Yergin and Joesph Stanislaw, 1977, ed., pp. 60-64. http://www.pbs.org/wgbh/commandingheights/shared/minitext/ess_nixongold.html

(4) The Forgotten Man by William Graham Sumner, 1876 http://oll.libertyfund.org/index.php?option=com_staticxt&staticfile=show.php%3Ftitle=1654&layout=html

(5) From Economic Man to Economic System, Harold Demsetz

(6) Hayek: His Contributions to the Political and Economic Thought of our Time, Butler and Riggenbach.

(7) A Conflict of Visions, Thomas Sowell.