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PaperclipPerfector  9mo ago (text post)   3200 thread views

Small-Scale Question Sunday for July 16, 2023

Do you have a dumb question that you're kind of embarrassed to ask in the main thread? Is there something you're just not sure about?

This is your opportunity to ask questions. No question too simple or too silly.

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I recently read this article, which seems to have awoken some latent bleeding heart in me. As a result, it’s got me thinking about wealth redistribution, whence the following questions:

  • What are some of the best “utilitarian” arguments against greater wealth redistribution in America? (When I say “utilitarian”, I don’t actually mean calculating out the utils involved— but I do mean arguments other than moral ones like “people ought be able to retain the results of their labor” (which argument I am particularly sympathetic to around tax season).) What are estimates of the argmax of the Laffer curve? Is there an inverse relationship between “innovation” and income tax rate that might explain why America is far more of a tech hub than Sweden? That sort of argument is what I would be looking for.
  • Are there any low-overhead charities out there where you can mostly-directly send money to poorer people? Preferably with options to filter by criteria such as number of kids, marital status, etc.

I understand that this post betrays a real naïveté in both economic knowledge and worldly experience— so I’ll admit that I’m a decent bit embarrassed about making it, but I figure that a Small-Scale Question Sunday thread is the best place to ask this.

What are some of the best “utilitarian” arguments against greater wealth redistribution in America?

I am generally pro-redistribution, but a couple of posts by Bret Deveraux about premodern agriculture made my thoughts about the purpose of inequality coalesce into a much clearer picture:

  • the land is split between subsistence peasants and landowners
  • subsistence peasants have lots that are just large enough to feed their family
  • the rest of the land belongs to the local landowner
  • the peasants work the landowner's land either as sharecroppers or as corvee labor
  • the landowner extracts the surplus from the land and uses it to support the middle class of warriors and craftsmen
  • there's a thin class of people that are supported by the peasants (blacksmith, miller, some traders), but the rest derive their livelihood from the surplus the landowner extracts from his land

Everything here is not circumstantial and explains why the system works:

  • why don't the landowners own all the land?
    • because they need peasants to work it
  • why don't the peasants own all the land?
    • because they would have no surplus to maintain an army to defend themselves
  • why don't the peasants save up and buy bigger plots to create a surplus?
    • because they have to split their wealth between their children. When there's no wealth to share, younger children are encouraged to leave the village, but when there is, the lots are split until the peasants are barely feeding themselves again
  • what proportion of land belongs to the peasants?
    • as little as possible, as long as there's enough hands to work the landowner's land
  • how much land belongs to a single landowner?
    • as much as it is possible to defend by force. When it's easier to defend your wealth, then the number of landowners grows and their latifundia dwindle. When it's easier to take over other landowners' wealth, the number of landowners dwindles and their latifundia grow

If some landowner deviates from the current optimum, they lose against their neighbors: either they don't have enough land to extract the surplus from, or they don't have enough hands to extract the surplus with. And even if we imagine a peaceful future where no one will threaten anyone with violence, the more equal community will lose against less equal communities because they will "waste" their surplus on a more comfortable life or a more numerous community instead of science, technology or even art.

If you squint really hard, this looks like it applies to modern societies as well. I once wrote a post about the direct economic effect of "eating the 1%" and the overall boost is just not worth it.

Now when Jesus was in Bethany, in the house of Simon the leper, There came unto him a woman having an alabaster box of very precious ointment, and poured it on his head, as he sat at meat. But when his disciples saw it, they had indignation, saying, To what purpose is this waste? For this ointment might have been sold for much, and given to the poor. When Jesus understood it, he said unto them, Why trouble ye the woman? for she hath wrought a good work upon me. For ye have the poor always with you; but me ye have not always.

If we are made in Lord's image, why can't we say the same?

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