I dont know: I think "the poor is needier than the rich" leads nicely into a discussion that all the greatest value exchanges originate from newly fulfilling most urgent demands rather than superficial ones
I suspect that if economics really understood this basic construct of development the world would not only be better but richer; partly because most people put a lot more of their discretionary energy into making a vital difference than one for serving the mores of rich people; and partly because connecting the disconnected has always been a fundamental driver of how the net could achieve new economies; and this hasnt begun to look at how much money we would save from having less risk globally and locally by just caring more about the needier; and how we need to clean up professions that add so much cost to the world by advising companies how to evade or litigate rather than just be transparent in the first place Of course -as the title of the book implies - understanding of what intangibles really are is needed to fully develop this preferred future case chris macrae, www.valuetrue.com Transparency Community [EMAIL PROTECTED] london 0208 540 5304 Europe Union Knoeldge Board sig-editor http://www.knowledgeboard.com/community/zones/sig/kmei.html http://www.normanmacrae.com/intrapreneur.html http://www.normanmacrae.com/netfuture.html ----- Original Message ----- From: "Bryan D Caplan" <[EMAIL PROTECTED]> To: <[EMAIL PROTECTED]> Sent: 27 November 2002 1:38 AM Subject: A Short Review of *Hard Heads, Soft Hearts* > I just finished reading Alan Blinder's *Hard Heads, Soft Hearts* and > thought I would post a few of my thoughts. The book is quite good > overall. It is basically the liberal economist we all know writes the > typical econ textbook, with the mask of neutrality pulled off. That's > all for the good - it's far better to argue with positions stated > explicitly rather than insinuated. > > Blinder begins by stating his two big principles: the Principle of > Efficiency ("more is better than less"), and the Principle of Equity > ("the poor are needier than the rich"). > > To be finicky, Blinder doesn't seem to realize that his first principle > is normative while the second one is positive. I think he *meant* to > say something like "helping the poor is better than helping the rich," > which is a very different claim. This would seem like nit-picking, > except that the one time Blinder tries to argue for the Principle of > Equity, he really does act as if the near-tautology that "the poor are > needier than the rich" is in dispute. > > I can only hope that Blinder would consider me a fellow "hard-headed" > economist. He did approve my dissertation, so I have hope. But I am > sure that Blinder would label me as one of the "hardest-hearted" > economists he knows. While he recognizes the existence of such, it is > very hard for Blinder to get inside of our heads. Why would anyone > choose to be "hard-hearted"? > > There are two main reasons. > > 1. The less fundamental reason to be "hard-hearted" is that soft- > hearted people - even comparatively reasonable ones like Blinder - are > hypocrites. They fret and fret about "poor" Americans, but barely even > remember the existence of absolutely poor foreigners. There is not a > word in Blinder's book about admitting more immigrants. And all of the > "soft-hearted" social programs we have for domestics are one of the > leading arguments for restricting immigration. > > I am confident that Blinder sees our current policy as much more > compassionate than that of the 19th century. But that's just wrong. > There was little government charity, but almost unrestricted > immigration. Native-born "losers" (as Blinder calls them) got little > help, but the world's poor had an amazing escape route from poverty. > Few people in the 19th century narcissistically lauded their own > "compassion," but policy did a lot more for the truly poor. > > Perhaps Blinder might say that these remarks indicate that I merely > disagree with the *application* of the principle of equity. I wonder. > Can somehow who says "Tough luck, low-skilled Americans. From now on > you'll be competing with Haitian immigrants" ever be called > "soft-hearted"? > > 2. The more fundamental reason to be "hard-hearted" is that the > Principle of Equity fails to recognize differences in MERIT. If there > were no efficiency consequences, why not equalize incomes? The answer, > I maintain, is that more able and hard-working people deserve more. > They earned it. It is insolent for the less successful to gripe about > it (or for the more successful to gripe on their behalf!). > > Thus, my opposition to the "soft heart" is not based on pure > malevolence, as Blinder occasionally implies. The problem is that > equality conflicts with merit. In his discussion of protectionism, > Blinder approvingly quotes Murray Weidenbaum: > > "Some of my conversations with business and labor leaders whose > companies are hit hard by imports remind me of the gripes of students > who cut class, do not do their homework, and then complain when you give > them a low grade." (p.118) > > What is wrong with such students is that they do not *deserve* good > grades. The same would be true, of course, if the students were > hard-working but stupid. Efficiency aside, if they do F work, they > should get an F. The "soft heart" would council mercy, but it would be > wrong to heed to it. > > People give merit its due in academic competition, athletic competition, > artistic competition, and more. Why not economic competition? What is > so hard about showing respect to the "winners," and expecting the > "losers" to keep their disappointment to themselves? > > Blinder obviously has little sympathy for people who favor tax cuts for > the rich and spending cuts for the homeless. They just seem "mean." To > paraphrase a Deep Thought by Jack Handey, "If it is 'mean' to think that > smart, productive people don't owe drunken beggars a living, then yes > Mr. Softie, I am a Big Meanie." > > I tend to think that the ramifications of merit are so wide-ranging that > little room is left for Blinder's Principle of Equity. Only if > resources "fell like manna from heaven" (as Nozick puts it) would > equity be relevant. But I am less certain of this extreme conclusion > than of the weaker one that merit matters *to some degree*. > > Blinder puts forward the plausible position that if a new policy > improves both efficiency AND equity, we should do it. I would suggest > as an alternative that we should look for policies that promote > efficiency, equity, and MERIT. > > I am willing to argue about the exact weights, but I do think that if > Blinder had considered merit at all he would have written a quite > different book. His chapter on protectionism would have been basically > unchanged - subsidizing failing firms looks as bad in terms of merit as > it does for efficiency and equity. But his analysis of taxation and > several other issues would have been quite different. > > Well, I've really only reviewed chapter 1 of Blinder, but in many ways > it is the most stimulating. Signing off. > > -- > Prof. Bryan Caplan > Department of Economics George Mason University > http://www.bcaplan.com [EMAIL PROTECTED] > > > Mr. Banks: Will you be good enough to explain all this?! > > Mary Poppins: First of all I would like to make one thing > perfectly clear. > > Banks: Yes? > > Poppins: I never explain *anything*. > > *Mary Poppins* > >
