Is inequality a problem?

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Critics on the left like to talk of disparities of wealth, income or living conditions. As libertarians, we can acknowledge that inequalities exist in society and they may (or may not) be unjust or “sinful.” Inequalities among people may exist for natural, inherent reasons that are neither unjust nor remediable. Other inequalities–often caused by the state–are both unjust and artificial.

People are naturally and differently gifted and so there are inequalities of beauty, of bodily and emotional health, intelligence, creativity, and energy. A person’s motivation and ability will naturally lead to varying levels of productivity and income. Such differences have always existed. The Church neither decries nor condemns this, but rather “recognizes the inequality among men, who are born with different powers of body and mind” and which result in inequality of wealth. [Leo XIII, Quod Apostolici Muneris, “On socialism”].

There is nothing inherently unjust in unequal economic outcomes. While we are bound by our charitable duty to meet the needs of the poor, the mere fact that rich and poor exist is not the sort of “sinful” inequality that can be ended (unless it be through a universal impoverishment caused by a socialist government).

[Note: the fact that global extreme poverty has been cut in half in recent decades is a subject for another post. SeeMassive Reduction in Global Poverty Might Be the Most Important Development in the World”]

Simulated government hotdog

There are, however, many “sinful inequalities” that can be eliminated, activities that the government has no business doing at all. And there are many things that government does that need doing by someone; such as building roads, running courts, providing security, etc. These are not bad in themselves, but badly done. No surprise here; everyone knows the legislature could screw up a hotdog. Even so, there are many sinful inequalities brought to us by the government. Here are a few in a nutshell:

Crony Capitalism:

Simulated bribery lobbying

The first sinful inequalities to be eliminated ought to be those benefits enjoyed by persons, businesses, and groups whose power and money is sufficient to secure legislation favorable to themselves at the expense of everyone else.

These include government subsidies to business, protective tariffs, too-big-to-fail corporate bailouts, and the use of eminent domain which destroys whole neighborhoods and takes land for big business at bargain prices. Intellectual property lawswhich have the chief effect of protecting monopolies while stifling creativity and productivity–should also be repealed.

On top of this, product regulations and occupational licensing requirements limit competition and raise prices, all to the benefit of established businesses. Zoning and other state-mandated land-use restrictions tend in the same direction.

Barriers to self-employment:

Closer to home are the “sinful inequalities” that prevent honest work. These are regulations that purport to protect the public but chiefly serve to safeguard existing businesses at the public expense. It is time to tear down the state-erected walls that separate workers from earning a living:

● Allow street vending along the public right of way. No permits, no licenses, just food carts, trucks and flea markets, etc.

Criminal haircut

Eliminate occupational licensing. Those who can cut and braid hair, midwives, carpenters, plumbers, beer brewers, nail clippers, babysitters, funeral directors, dental hygienists, and other practitioners should be left alone to do their work without arbitrary educational requirements, testing, dues-paying and permission from the government. Even professions like medicine, law, engineering, and architecture would be better certified by private entities.

No government permission should be required to operate garage sales, grow vegetables, raise chickens or sell those goods from the same premises.

People should be allowed to practice trades out of their homes; to build things, to can food and bake bread, to cater to customers out of their home kitchens

Other reforms:

If government is going to level the employment field, it is also time to repeal the minimum wage laws. The reasons are many, but the bottom line is that the minimum wage is nothing more than a barrier separating unskilled workers from a job.

While working for a living is the top priority in raising up the poor, another way government can help is by getting out of the way of affordable housing by:

Eliminating minimum house and lot sizes and other building code restrictions that prevent the poor from owning a home.

Repealing zoning laws that prevent homeowners from creating small apartments out of basements and attics, thereby creating income and increasing the amount of affordable rental housing.

Making it easy to establish boarding houses where people can live well and cheaply.

These are just a few areas where government could create widespread prosperity with libertarian ideas by eliminating “sinful inequalities.” Of course, this is just a start.

In the next post, we will consider those who argue that Catholics cannot be libertarian because libertarians resist the welfare state.

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