Does an Extra Dollar Really Mean More to a Poor Man Than a Rich One?

Harvard psychology professor and world-class public intellectual Steven Pinker was recently interviewed by David Marchese of the New York Times. Here is a bit of the views of this exceedingly bright and fascinating man:

Q: “Is it possible that the rising-tide-lifts-all-boats economic argument provides the wealthy with an undue moral cover for the self-interested inequality that their wealth grants them?”

A: “Oh, absolutely. It is a danger that all democracies have to safeguard against: With wealth comes influence and power, and there’s the constant vulnerability that the wealthy will game the rules to favor themselves. Another is related: Given that we have a tax system, it’s elementary fairness that the rich should pay a greater share, that taxes should be progressive. For the obvious reason that an extra dollar means a lot more to a poor person than a rich person. So it hugely increases aggregate welfare if the rich pay a greater share than the poor. For all the debates in the United States as to whether governments should reduce poverty, should support education, support health, the debate is kind of over. We already do. All affluent societies do. It’s easy to be seduced by a kind of radical libertarian argument that the role of government should only be to help enforce contracts and maintain safety and law and order. However appealing that might be in theory, in practice it doesn’t exist anywhere. There’s no such thing as a libertarian paradise of an affluent democracy with no extensive social safety net.”

To be sure, the rich will try to “game the rules to favor themselves.”  But they are hardly the only ones we have to watch out for in this regard, nor are they even the most successful at it.  Others who have stolen a march on them include the feminist movement, the black movement, the transgender movement, the socialists, and wokesters of all other sorts and varieties.  Indeed, with the constant lament about “white privilege,” “male dominance,” and the evil rich, there is reason to believe that the wealthy are not so much gaming the system as having it gamed against themselves.

One response to the existence of taxation is that we ought to get rid of it, root and branch.  For it is the only legal element of the present system that is totally and utterly coercive.  No one else is lawfully allowed to mulct money from anyone who has not clearly and unequivocally agreed to pay.  An imaginary “social contract” would not suffice in any court of law to justify A compelling B to pay him a dime.

Moreover, given Pinker’s obviously correct assessment that this type of legal plunder will not soon vanish, if ever, who should pay what?  Does an extra dollar really mean a lot more to a poor person than to a rich one?  This Harvard professor cites no evidence in support of this contention, nor can he, given the subjectivism of this sort of thing.  It is easy to think of alternative cases: poor drunken bums, it might be contended, enjoy that last drink before falling into a stupor less than money spent by a rich man on more beneficial pursuits.  An alternative view is that interpersonal comparisons of utility are simply impossible, and anyone, such as Pinker, who engages in them is operating outside the bounds of rationality.

But let us posit, arguendo, don’t ask, that this is true.  Would this justify compelling a monetary transfer from the rich person to the poor one?  Certainly not on deontological grounds.  What about utilitarianism?  Would this handover “hugely increase … aggregate welfare”?  Superficially, it would.  But a moment’s thought will cast doubt on this contention.  Forcing rich Peter to give poor Paul money would reduce the incentives of both to be productive.  The former will emigrate, or hire tax attorneys to protect him, or spend time and effort hiding his wealth, or not take on the next project that might have benefited the entire human race.  The latter, too, will lose out.  If being poverty-stricken is the criterion for receiving benefits, why, then, there is all the more reason to slack off.

Adam Smith knew a bit more about economics than Steven Pinker.  A while ago, he wrote a book called The Wealth of Nations.  He saw, unerringly, that countries that adhered to free enterprise were more prosperous than those that greatly relied upon Pinker’s distributionist advice.

Is “the debate … kind of over”?  Pinker thinks it is, since “[t]here’s no such thing as a libertarian paradise of an affluent democracy with no extensive social safety net.”  But there is no place on earth free of COVID, murder, rape, theft, AIDS, heart disease, traffic fatalities, etc.  Pinker is attempting to draw an “ought” from an “is.”  He ought to read up on what David Hume said about that philosophical error.  Just because there is no government limited to enforcing contracts and maintaining safety and law and order does not at all mean there should not be.