Apologists for the state often suggest that the state is essential if people are to be protected against deprivation resulting from accident, disaster, or injustice. I’m not persuaded that they’re right that state anti-poverty programs are needed to deal with the problem of poverty. The problem of poverty is systemic; but eliminating the systemic injustice of the state (rather than tweaking this or that inequity while leaving others in place) could make the problem of poverty quite manageable in the state’s absence.
For one thing, states don’t treat recipients of the anti-poverty aid they disburse especially well. It’s important to avoid comparing idealized state practice with imaginary worst-case practice in a stateless society. If we focus on actual state practice, we find that poor people are not served particularly well by the state, and that states routinely intrude into the lives of recipients of state assistance, violating people’s privacy and seeking to regulate their behavior. People pay a high price for aid from the state.
In addition, states actively make and keep people poor. Licensing laws, zoning regulations, and similar restrictions make it hard for poor people to enter particular job markets and to operate businesses out of their homes. Without the state to put these kinds of restrictions in place, people would be less likely to be poor.
States also raise the cost of being poor. Building codes and zoning regulations raise the cost of housing, and so make it harder for people to find inexpensive homes. Some people are forced to live without permanent housing at all, while others must spend much larger fractions of their incomes on housing than they otherwise would. Agricultural tariffs raise the cost of food, the most significant portion of anyone’s budget. Without the state to make meeting their basic needs unnecessarily expensive, poor people would have more disposable income and would be more economically secure.
States increase the number of poor people in part precisely through some anti-poverty programs, which can create perverse incentives both for people to remain poor enough to qualify for government funds and for bureaucrats to keep people poor in order to retain their own jobs.
And states actively take money from poor people. Many poor people pay more in taxes than they get back in services under the state’s rule. These people would have more resources, net, in the absence of the state’s demand for tax money. In addition, many people are poor, or poorer, today because the state has actively stolen land and other resources from them or their ancestors or has sanctioned such thefts committed by the wealthy and well connected. The existence of a peasant class and of a class of displaced urban workers willing to accept employment on dismal terms is inexcplicable without reference to state violence or state tolerance for or endorsement of violence by the wealthy and well connected.
Further, support for poverty relief doesn’t just come from tax funds now, and there’s no reason to think no one would support poverty relief efforts absent the state. People give money to charitable causes over and above their tax bills today, despite the huge sums the state claims. There’s no reason to think they wouldn’t do so in a stateless society. It is naïve to suppose that the wealthy and powerful are opposed to state funding for services to the poor at present; the poor have far less clout than do the wealthy and powerful, and yet the state provides minimal services for poor people. There is no reason to suppose that wealthy and well connected people willing to see the state spend their tax money to support services for the poor would be dramatically less willing to contribute to the support of such services without the state. (Why do people give money to good causes, including voluntary programs that help the poor? Why do wealthy and well connected people endorse state spending on programs that provide services to poor people. Presumably for a combination of reasons, including [in no particular order] compassion, social norms, the desire for good reputations, the desire to avoid bad reputations, and the desire to avoid social disorder. All of these reasons would be operative in a stateless society.)
In a stateless society, less money would be spent obtaining key services. Without the state, there wouldn’t be taxes, and what are now state-provided services would be available on the market and thus in most cases less expensively. The state does a range of things (notably requiring professional licenses, hospital accreditation, and prescriptions and enforcing drug and medical device patents, and other restraints on trade) to make particular services, like health care services, especially expensive. Without state interference, basic services would be less expensive and more available. In addition, some services (think a bloated military) wouldn’t be part of the picture at all. So people would have more disposable income than at present. This means both that people with limited incomes would be better off and that people with more money would have bigger disposable incomes from which to give to support good causes (recall, again, that lots of people do this today even while paying taxes).
Statists sometimes worry that the absence of the state would mean a return to the misery and squalor typical of many people’s lives in the eighteenth- or nineteenth-century; they too often attribute these condtiions to the absence of state regulation and anti-poverty programs. But it’s important to emphasize that these conditions reflected the much lower overall levels of societal wealth. People weren’t poor because of the absence of state regulations and anti-poverty programs; they were poor in part because there was very little wealth overall and thus less for those who wanted to help the poor to use to do so. (Thanks to Tom Woods for this observation.) And of course the misery and squalor weren’t natural or inevitable: they resulted from persistent—remediable—injustice on the part of elites and their political cronies.
It’s also worth emphasizing that the absence of the state would make almost everyone (apart from the state’s corporate cronies) richer. The state’s subsidies and regulations drive down the overall productivity of the economy. So, again, there’s good reason to believe that, in its absence, people, including members of the working poor, would be wealthier on average than they are today. Again, this means both that poor people would have more money and that those in a position to help them would, too.
State-administered programs are less viable, less able to help the poor, precisely because those programs feature high administrative costs. (Thanks to Tom again on this score.) Programs supported freely by people in a stateless society would not feature such high administrative costs: because donors could support multiple programs, there would be persistent pressure for administrative costs to be reduced.
Mutual aid networks could provide many of the services well intentioned statists want the state to offer. Societies in which people pooled risk and provided pensions, health care, and other services functioned effectively before the rise of state social services, and there’s no reason to think they couldn’t again without the state—and, indeed, wouldn’t function much better given that people would have access to more resources and that the state wasn’t on-hand to regulate them out of existence.
In a stateless society, rectification for state-committed and state-sanctioned wrong-doing would significantly decrease poverty. Politically privileged elites have stolen land and resources from poor, working class, and middle class people. To the extent that land and other resources were made available for homesteading or returned to those from whom they were taken, there would be a significant shift of income to people currently limited in resources.
And structural changes would make poverty less likely in a stateless society, too. Rules that made it harder for absentee landlords to sit on undeveloped, uncultivated land could open up this land for homesteading by people with limited resources and thus provide them an avenue to greater economic security. Eliminating subsidies and legal privileges for hierarchical corporations would increase the likelihood that people could enjoy the job security associated with working for themselves (with less risk than accompanies being an independent contractor in a less healthy economy) or in partnerships or cooperatives and that, when they did work for others, they could bargain successfully for better compensation.
In addition, social norms could ensure predictable, consistent support of community-wide aid programs without taxation. General acceptance of a social norm entailing regular contributions to a community income support fund, or leaving the edges of fields available (as in Leviticus) for gleaning, could ensure that poor people who needed it could rely on community assistance.
State-managed anti-poverty programs draw on tax resources taken unwillingly from people. People work less energetically and enthusiastically when they know that some of what they produce will, in effect, be taken from them at gun-point. Thus, taking resources from people through taxation to fund anti-poverty programs can function as a drag on the economy. By contrast, when people give willingly to support anti-poverty efforts, their own objectives are not being thwarted; if they wish to support these efforts, then they will be willing to work hard to do so. Thus, the existence of even quite substantial anti-poverty efforts in a stateless society need not conflict with people’s working enthusiastically to earn wealth and thus with overall economic productivity.
In short, the state often makes the problem of poverty worse, and the state is not needed to remedy deprivation and economic insecurity. Provided the full range of statist privilege for the wealthy and well connected is eliminated, people could deal effectively with the challenge of poverty absent the state.
NOTE: This post reflects my reworking of some earlier comments in partial response to Art Carden’s observations here.