Hard Work vs. Luck

Will Wilkinson has an interesting post about the very different ways conservatives and liberals think about wealth and poverty. He summarizes:

Liberals tend to explain both poverty and wealth in terms of luck and the influence of social forces while conservatives tend to explain poverty and wealth in terms of effort and individual initiative.

Absolutely true; my liberal take on the social origins of wealth is here. And this is why, as Wilkinson notes, libertarians usually end up allied with conservatives in American politics, despite their very different personalities:

As long as they stick to complaining about handouts for poor people sitting on their asses and praising rich people working hard to make civilization possible, libertarians and conservatives get along fine.

I would like to insert a few caveats here. My main objection to the conservative notion that wealth comes from hard work is at the top of the pyramid, not the bottom. Think about this: do corporate executives work harder than janitors or coal miners? I submit that they do not. Or, do corporate executives work harder today than they did in 1955, when their salaries were much, much lower? No, they do not. Does anything about the way people work explain the increasing inequality in America, that is, the ever growing ratio between the salaries of CEOs and the wages of factory workers? No, not at all. Inequality is growing because the rich have gotten more shameless and more clever about exploiting their positions to enrich themselves, along with (possibly) some effects of globalization. This insight explains why I support much higher taxes on the very rich, and why I get furious whenever I see people with money congratulating themselves on how hard they work to earn it.

On the other hand I agree that at the bottom income has a lot to do with personal choice and failings. Consider the people you know who are poor, or who have fallen far below the standards of living of their parents, and you will surely see that most of them have serious problems: drugs, alcohol, divorce, poor mental health. Or else they chose to give up middle class life for a shack in the mountains somewhere. I believe that in America reasonably healthy people with normal intelligence can make a decent living if they put their minds to it.

But I still think that the conservative/libertarian critique of the "welfare state" is off base. First, in America we actually spend little money supporting healthy poor people. Conservatives seem to imagine that we spend hundreds of billions supporting lazy layabouts who ought to get off their buts and get a job. We do not. The only "welfare" program in America that spends real money is Medicaid, which pays for health care, and most of that goes to people who are really sick, or else to children. There are certainly some slackers collecting Social Security disability payments, but only the hardest core libertarians think we should abandon that program altogether, and as long as it exists some people will exploit it.

I generally accept the notion that people are poor in America because of something that is wrong with them, not some flaw in capitalism. But that something is often not their fault -- the best predictor of poverty in America is mental illness, and I think we should absolutely be taking care of people with medical problems. And even where people have genuinely screwed up -- and this is the key point -- what are we going to do about it? Many conservatives think that the existence of miserable poverty is good and important, because it motivates people to work hard. If there is no penalty for failing to get up and go to work in the morning, the argument goes, more and more people will opt out of work and society as a whole will get lazier and less productive. Liberals think that if you give people the help they need, a lot fewer of them will end up poor.

Consider a 22-year-old single mother who had a child at 16 and dropped out of high school and generally screwed up her life but now wants to get back on track. I suppose the conservative attitude would be to say, "great, work hard, we're pulling for you." A liberal asks what we as a society can do to help her and her child. What does she need? Child care? Free GED classes? drug treatment? Help finding a job? What if she want to become, say, a medical tech of some kind. A liberal wants to provide her with free or at least very cheap classes at the local community college. Is that some kind of disreputable handout that cheats the people whose taxes pay for it, or is it how we create a world in which everyone really has a chance to rise or fall by his own efforts?

My biggest complaint about conservative economics is the element of bad faith. It is simply not true that low tax, low regulation societies have more social mobility; more poor people rise into the middle class in Denmark and Sweden than here. It is not true that low taxes on the rich help to create a more dynamic economy in which poor people can get ahead more easily. It is not true that governments fail at everything they attempt, or that they are inherently less efficient than private firms. When conservatives spout these lies, I hear the desperate self-justification of greedy people who just hate paying taxes because they don't give a damn about anyone else. To create a society with real equality of opportunity -- something conservatives claim to believe in -- actually takes massive government intervention, not lower taxes on millionaires. A society in which everyone actually has the same chance to succeed or fail by his own efforts has never yet existed, and we still have a long way to go to create one.