Here’s part II of my comments on Tomasi’s Free Market Fairness for the Pacific APA. Much of this material today will be familiar to regular readers of this blog. Tomorrow I’ll post some newer stuff you haven’t heard here yet.

The Exclusion Problem

            For Rawls—at least most of the time—the first principle of justice has lexical priority over the second principle. The liberties described by the first principle take priority over the form of social justice described in the second principle.

David Schmidtz illustrates this by asking us to imagine that, bizarrely, Jim Crow laws turned out to be to the economic advantage of African Americans.[i] Instead of the American Deep South, imagine a property-owning democracy just like the kind Rawls describes, except that it has Jim Crow laws. Now suppose, contrary to actual economic fact,[ii] that segregation was so economically efficient that blacks do better under segregation than under non-segregation in this property-owning democracy. Suppose, weirdly, that segregating certain least-advantaged classes actually makes them more economically advantaged overall. Schmidtz explains that for Rawls, because liberty comes first, segregation would still be unjust, even in these circumstances.

Or, alternatively, suppose we determined through sociological studies that outlawing a particular religion, say Rastafarianism, would lead to greater economic efficiency, which in turn would improve the situation of the least-advantaged class. Suppose it would even make Rastafarians richer. Still, freedom of religion is protected by Rawls’s first principle. Thus, according to Rawls, we cannot outlaw Rastafarianism, even if doing so would help us realize goals of social justice. The basic liberties come first; social justice comes second.

You can see where this is going, because it’s the obvious objection. Surely, the more firmly and broadly we entrench capitalist economic freedoms in the first principle of justice, the less space there is for us to realize social justice through the second principle. At the extreme, imagine that we put in the first principle the very same economic rights that Murray Rothbard believes us to have. In that case, no amount of institutional tweaking of property rights, economic redistribution, taxation, etc., would be permissible. Thick economic liberty excludes social justice.

Now, one response to this criticism would be to accept this extremely robust conception of economic liberty, but then argue that at the level of ideal theory, a Rothbardian anarcho-capitalist society or a Nozickian/Randian minimal-state capitalist society could realize Tomasi’s version of justice as fairness. In fact, I think both of these societies can realize justice-as-fairness at the level of ideal theory, because “realizing justice at the level of ideal theory” is a fairly easy test for regime-types to pass, though not all pass it. One can then just say that full, complete justice requires us to give everyone an extensive sphere of personal and economic liberty as well as to realize certain distributional goals. At an ideal level, robustly anarcho-capitalist institutions can do this. In the real world, maybe they won’t, but that’s a defect of the people, not the institutions. (Justice requires anarcho-capitalism with voluntary charity, etc., but people are too despicable and evil to make it work.) Tomasi doesn’t go this way, but he could, if decided to write a Gerald Cohen-style version of Free Market Fairness. I’ll return to this point below.

Tomasi doesn’t go this route, though. His conception of basic economic liberty is more robust than Rawls’s, but not as robust as Nozick’s or Rothbard’s. But just how do we draw the line? Why does Tomasi think certain welfare-state programs are compatible with robust economic liberty, but others are not? My hypothesis is we can see what’s really going with Tomasi by noticing that the typical social democracy (such as the United States or Norway) is a hybrid of two different things, what I will call 1) the administrative state, and 2) the social-insurance state. For Tomasi, the administrative state is a big threat to our rightful liberty, but the social-insurance state is not, at least, not until the taxes get too high. Tomasi’s book is an internal critique of one half of social democracy, but not the other half.

The administrative state tries to run everyday economic affairs. It treats the economy as if it were a machine, and it runs on the premise that it can engineer this machine to improve its output. It manages and regulates the economy. It issues licenses, controls imports and exports, determine who can produce what and what terms, and controls the money supply. It might set prices or make it illegal to sell certain products. And so on. The basic idea is that the administrative state has its fingers in everything, constantly manipulating the economy through ad hoc rules and regulations, in order to attempt to generate the preferred outcomes.

The social-insurance state on the other hand provides tax-financed social insurance and welfare programs of one form or another. It might provide schools or vouchers for schooling, basic income or unemployment insurance, and the like. By itself, the social-insurance state lets market do what the market wants to do. It just tries to ensure that the losers on the market still have the means to lead decent lives.

Consider countries such as Denmark or Switzerland, which have effectively separated their welfare state from the administrative state. The Wall Street Journal and Heritage Foundation annually rank countries by their level of economic freedom. On nearly every measure associated with the administrative state, Denmark rates as having equal or much higher levels of economic freedom than the United States. Denmark ranks much higher than the United States on property rights, freedom from corruption, business freedom, monetary freedom, trade freedom, investment freedom, and financial freedom. (Denmark rates 99.1 in business freedom, 90.0 in investment freedom, and 90.0 in financial freedom. In comparison, the US scores 91.1, 70.0, and 70.0 respectively on these measures.) Luxembourg, the Netherland, the United Kingdom, and many other countries beat the US on these measures as well. Yet Denmark also has a remarkably effective welfare state. Hard libertarians would regard Denmark as unjust because it taxes some to provide for others. Neoclassical and classical liberals in contrast may look favorably upon Denmark or Switzerland.

Tomasi’s basic idea, I think, is that respecting our fellow citizens as authors of their own lives means giving them a large sphere of freedom in which to construct themselves and in which to pursue their conceptions of the good. The administrative state gets in the way. To cede power to the administrative state just is to limit the freedom of citizens. But the social insurance state is different. The social insurance state could help make sure that everyone is in a position to benefit from the wide range of economic freedom Tomasi’s favored arrangements leave them. Now, Tomasi probably believes that at some point, taxes become so high that they are confiscatory and a real threat to freedom, but he doesn’t regard all taxation as inherently a limitation on people’s economic rights. Taxes for just purposes aren’t theft. A person’s economic rights are about giving her large sphere of unimpeded action—a sphere in which she doesn’t need to go around begging for regulators’ (or coworkers’) permission—not about protecting her from the dreaded 1040. For Tomasi, taxes are not automatically presumed a violation of economic liberty, though many government regulations (aside from those actually needed to prevent us from harming each other[iii]) are.

On Brown and Yellow People [Or: I use the workshop as an excuse to discuss freedom of immigration]

            Imagine a libertarian saying, “This program would greatly benefit the bottom 90% of income earners, but it might, in the short term, come at the financial expense of the 91^st-93^rd percentiles. It might in the short term cost the people in the 91^st-93^rd percentile as much as 8% of their income. So, I oppose it. Also, it might mess up our culture—making it so that two few of us speak French, and so I oppose it.” Actually, no libertarians say that, but many Rawlsians do.[i]

            Tomasi doesn’t have much to say about immigration in Free Market Fairness. He notes (p. 202) that many people on the Left (including orthodox Rawlsians) and Right call for increased immigration restrictions in order to maintain social welfare programs. He briefly discusses issues of free immigration on p. 262, noting that most economists believe that free immigration would greatly benefit the world’s poor. I want to comment briefly here on the issue of immigration and ask Tomasi to say more about what his theory really has to say about the issue.

Let’s be really frank here. The typical left-liberal or left-non-liberal regards the typical libertarian as morally backward. They see libertarianism as a rationalization of disregard for the needs of the poor. Many classical liberals similarly look down upon the typical left-liberal and left-non-liberal. Many on the Left in American and European politics claim to care about the poor. But their hearts bleed for the American and European lower classes—that is, for people who are wealthy by world standards—not for the world’s poorest people. Most people on the progressive left actively try to restrain the world’s poorest and most vulnerable people from making life-saving and life-changing trades with willing employers. They thus condemn the world’s poor to death and misery. In my view, unless you advocate open borders and free immigration, than any claim to be concerned with social justice is mere pretense. I read Rawls’s Law of Peoples as a communitarian, conservative attack on social justice.

The consensus among economists is that 1) immigration restrictions are tremendously inefficient, with an approximate deadweight loss of 100% world GDP,[ii] 2) immigration massively benefits the world’s poor, and 3) the main losers from free immigration, in the short term, but not the long term, are uneducated, unskilled first world workers. (In contrast, other workers see their wages rise, not fall, from free immigration.[iii] It’s worth noting also that, contrary to commonsense misconceptions, immigrants do not increase crime.[iv])

However, many Rawlsian philosophers say we need to keep people out in order to keep our societies just. After all, we can’t afford to give them all the welfare they need, nor can we afford to modify property rights the right way. If they’re poor on that side of the fence, that’s okay (provided we send a little international aid), but if they come over to this side of the fence, become 10 times richer, but remain poor compared to us domestic-born people, then their presence converts our just society into an unjust one. So in the name of justice, we have to keep them out.[v]

Briefly, my view is that this is really really rotten. Philosopher Michael Huemer explains this with a thought experiment: Imagine starving Marvin heads to the market looking for food. Marvin has little to trade. However, suppose there are people at the market willing to trade food for whatever Marvin has. Imagine that unless someone stops him, Marvin will successfully get to the market, make the trade, and eat. However, now imagine that you forcibly prevent Marvin from getting to the market. You post guards to keep him out. The guards continually capture Marvin and turn him away. Marvin can’t barter for food. He starves and dies.

In this situation, Huemer says, you have done something morally comparable to killing Marvin. His blood is on your hands.

In another version of the story, imagine Marvin is not starving, but is instead desperately poor. Imagine that if Marvin makes it to the market, he will make some trades and instantly become ten times richer. Imagine Marvin will be able to send large amounts of money back to his poor village to feed his entire extended family. However, again, you post guards, who turn Marvin away. In this case, you force Marvin to stay poor. It was not your fault Marvin was poor to begin with, but it is your fault he remains poor.

In these thought experiments, you do not simply fail to help Marvin. That is, you are not doing something equivalent to walking by a beggar without donating spare change. Instead, you actively hurt Marvin by using violence to prevent him from making a trade with a willing partner. It is as if you saw someone else offering a beggar $5 to wash a car window, but you scared the beggar and the driver away with your gun.

Immigration restrictions are morally equivalent to keeping Marvin from the market in the thought experiments above. Some people in rich countries want to hire poor foreigners. The foreigners want the jobs. These jobs make the difference between life and death or prosperity and poverty. Immigrants to the United States usually see their income rise by an order of magnitude or more—they go from desperately poor to relatively wealthy almost overnight. But the United States and other countries post armed sentries around their markets. They use violence to stop foreigners from making life-saving or life-changing trades with willing partners. This is morally equivalent to killing the foreigners or forcing them to stay poor.

What could possibly justify this? I won’t rehearse Rawls’s Law of Peoples here, because I suspect Tomasi does not accept this piece of Rawlsianism. One virtue of Tomasi’s theory is that it might be in a better position than Rawls’s to say the right thing here. But I’d like to hear more from him.