Inequality — How much is too much?

What shape is the income distribution of Andrew Leigh’s dreams? Even he doesn’t know. "I don’t have a strong sense of what the right level of inequality is", he writes. "Indeed, I’m not even sure I have the right intellectual framework for answering the question."

The question is Andrew Norton’s. In the comments threat of recent post on ‘progressive fusionism’ he writes:

…‘progressives’ tend to think that there is a correct distribution of resources that can be decided in advance. However, in practice they tend to be very vague about what this correct distribution would actually look like. Andrew Leigh, for example, has written much about inequality of income, always with the assumption that less inequality is the correct outcome, but never saying what level of inequality would satisfy him.

So how should a ‘progressive fusionist‘ answer the question? The Cato Institute’s Will Wilkinson suggests that a new alliance of progressives and classical liberals might combine John Rawls’ ideas about justice with Friedrich Hayek’s ideas about markets. From this perspective, it’s not possible to decide on a correct distribution in advance. That’s because the question isn’t a purely philosophical one. On its own, Rawls’ theory doesn’t tell you what shape the income distribution should be.

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Death to the author!

If you’ve ever been quoted out of context by journalist you’ll know what it’s like to be a fictional character. As a therapist to troubled inhabitants of fictional works, I see what happens when authors abuse characters who are often finer human beings than themselves.

The intelligent and tough-minded Mr Gradgrind is a typical example. Most of you know him only through the confused and sentimental writing of Mr Charles Dickens. In Hard Times, the hapless Mr Gradgrind can hardly open his mouth without inviting some sarcastic commentary from the author. But is Mr Gradgrind able to take the same liberties with Mr Dickens? If only.

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Speaking of Russians

The most powerful computing system ever assembled doesn’t belong to a university, a government, or even the mythical systems of the NSA. It probably belongs to Russian programmers.

I’m talking about the Storm trojan network. It is the most advanced and unstoppable system of its kind ever placed in the wild. Estimates have it in control of between 1 million and 50 million PCs. Enough to disable any internet-connected system anywhere on Earth. Enough to knock continents offline, actually.

As a libertarian I take private property seriously. Where do these trojans and bot networks fit into the picture? Partly as trespassers. But what does it mean when your property is hijacked to trespass elsewhere?

As usual, Bruce Schneier has a good summary of how it works.

Climbing the Tree of Freedom

Previously I have written about the need for libertarians, classical liberals and like-minded folk to focus efforts on “low hanging fruit” when discussing and promoting policy. That advice has largely be aimed at the Liberty & Democracy Party, whose members are sometimes given to arguing to death issues which the mainstream don’t give a rats about. While I am now considering joining the LDP, I think more thought still needs to be paid to this issue.

Now I’d like to present a related metaphor to picking low-hanging fruit; it is climbing the tree. Essentially libertarians are apt to give a lot of time and thought to developing models of ideal worlds, then measuring the real world against them. I know economists do this too, but libertarians like Murray Rothbard – more accurately he was an anarcho-capitalist – built quite detailed descriptions of how everything was meant to hang together ethically, not just economically. The contrast with present practice is stark. Stark and — this is the key thing — highly motivating to a certain sort of mind.

In 1946 a stalwart libertarian called Leonard E. Read said in a speech that if there were a button on his podium that would immediately abolish all controls and regulations on the U.S. economy, he would push it. This is heroic and it swells the chest, but it doesn’t really account for the fact that no such button exists; and if it did, very few voters would let libertarians go anywhere near it.

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Stop Slandering Ants

I know, I know. Another libertarian singing another song about markets. You’re probably sick to death of us banging on about how price signals can coordinate economic allocation across vast distances between unrelated parties. How millions of individuals focusing only on themselves can solve unthinkably complicated problems of coordination.

Well it turns out that economists weren’t the first to figure this sort of thing out. It was the ants.

Via the original megablog Slashdot comes this fascinating feature in National Geographic about swarm theory. It profiles research in the field and it’s a fascinating read.

What was interesting to me was that it seems the researchers are unfamiliar with the economic work which seems at least analogous. One by the name of Eric Bonabeau even says “We’re not used to solving decentralized problems in a decentralized way”.

Balderdash. The global economy and its billions of participants solve complex decentralized problems in a decentralized fashion every single day. It succeeds for the same reason that evolution has permitted the formation of hive societies: individuals only solve a small part of the problem and some simple rules permit the propagation of information. For the ants it’s touching feelers, for humans it’s looking at the price tag.

So, my fellow libertarians, let us stop aping Robert Heinlein. When he portrayed insectoid society as the perfect communists he was quite wrong. They are in fact shining examples of the strengths of voluntary society.

Broadband Can Wait

Last year I wrote about the idea of Citizen Audits — enabling citizens to observe the activities of government by opening up their computer systems to outside scrutiny. Now via the Dead Roo comes that news that the Federal Government is quietly lurching in that direction. Just not very well. The work to date suggests to Kieran David Bath that DOFA:

  1. Thinks senior management and executives in Australian agencies are stupid
  2. Dont have a clue what Australian agencies actually do (which is maybe because individual agencies couldnt tell them)
  3. Doesnt want a means of tracking expenditures for service delivery
  4. Wants a lot of money wasted, and go to large consultancies, mostly based overseas.

Actually, its probably a combination of all of these.

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Libertarian Distractions revisited.

One of the very great ironies of posting about angry shitfights between libertarians on other websites was that they came to Club Troppo to carry on the brawling. Now by Catallaxy standards it was a very gentlemanly affair, reaching no more than 112 comments. For the rareified (some might say stultified) milieu of Club Troppo it was a positive riot. So much for improving things.

I felt it was time to revisit on of the themes of my previous entry: the ease with which ideology can derail practical outsomes. The LDP is looking at voting policy. Unlike debates about gun laws, this one hasn’t descended into name-calling, but it does illustrate the classical flaw in ideological (particularly deontological, rights-based) thinking: failing to realise not all outcomes are possible, because there are instrumental costs for backing any policy.

It’s funny that this has to be pointed out at all. As a group libertarians are stereotypically awash with economic understanding. They refer to it and derive from it to explain many of their policy positions, regardless of whether they are deontological or consequentialist libertarians. Probably the first principle any economics student learns is that wants are unlimited, means are limited. Choices have to be made.

Otherwise put: the question of whether or not to make voting voluntary is not worth pursuing with any great energy. It is an example of what I might, to extend the analogy I’ve used before, call a “high hanging fruit”. A fruit which is difficult to obtain and in any case fairly scanty. For the libertarian program to obtain traction, focus must rest on the low hanging fruit: the fat juicy policies which have a large positive effect, are straightforward to explain, and which can at least fall within spitting range of mainstream discourse. The 30/30 tax and welfare reform package is an excellent example of a low-hanging fruit.

It doesn’t hurt to investigate these sorts of policies. Let the party draw its conclusions. Broadly speaking voluntary voting is a better fit in principle for the deontological libertarians, though yours truly has some very strong consequentialist objections to it. Indeed it can be helpful to have addressed these issues in advance, so that the fleeting opportunities and sudden moments of change which sometimes come to politics can be used to the fullest advantage.

But to do any more than this is folly. It wastes scant resources on a scant return. I would urge the LDP not to pick this policy instead of the low hanging fruit.