What Does Madison Teach Us About Wealth Redistribution?
President Obama’s unapologetic redistributionist philosophy, which he informally unveiled with his comments to Joe the Plumber, has brought class warfare to a heightened level in this country. His other statist and anti-capitalist proclivities have generated, in a sense, a national debate about socialism – not that many people will openly defend it. But there do seem to be more open expressions of contempt these days for the inequitable distribution that inheres in a capitalist system. Obama appears to favor equality of outcomes over equality of opportunity. Liberals increasingly employ both taxing and spending policy to equalize outcomes.
I think the Obama Democrats’ flagrant advancement of socialism, and the explosion of national debt to which it has significantly contributed, have, more than any other factor, driven the Tea Party protests. On the other end of the political spectrum, we have seen a bit of a backlash from leftists who stubbornly cling to socialist ideas -- to the point that they believe Obama has betrayed the cause.
Whether or not you can get Democrats to directly condemn capitalism, more of them are out of the closet lamenting its alleged excesses and challenging the moral underpinnings of the free market. Some still romanticize socialism, as we saw recently with Kate Zernike’s piece in the New York Times challenging the view that American colonists experimented with, then rejected, socialism (it would be more accurate to describe it as communalism). Professor Rahe posted his informative piece setting the record straight.
All of these developments have caused me to think about this more than usual. That’s why I was intrigued when glancing through a book that has been in my library for some time – James Madison and the Future of Limited Government, edited by John Samples and published by the Cato Institute. It was these few sentences from Samples’ introduction, in which he discussed Madison’s Federalist No. 10, that particularly caught my attention:
Madison would be shocked by a federal government that consumes one-fifth of national wealth and regulates most economic activity. He would be less shocked that the federal government is largely in the business of redistributing wealth. Federalist No. 10 argued that redistribution arose from a flawed human nature and tended to destroy republican liberty.
This prompted me to reread Federalist No. 10, whose profundity, in my view, cannot easily be overstated. I was quite curious as to whether Madison indeed argued that redistribution arose from a flawed human nature and tended to destroy republican liberty. If so, it occurred to me, this would serve as additional proof (for those who need it) that our ancestors were indeed philosophical enemies of communalism and that the very father of our Constitution himself rejected it on moral grounds. For if there is one pressure point on which credulous people are vulnerable to the deceptive allure of liberalism, it is the notion that liberalism is more compassionate than conservatism. More than anything else, this is the hook by which the liberal intelligentsia, especially in academia, shame so many of our kids away from conservatism.
For those who don’t want to read the entire 3,000 words of Federalist No. 10, despite the fact that you will be quizzed on it at the end of this post, Let me share a few selected gems from it.
As long as the reason of man continues fallible, and he is at liberty to exercise it, different opinions will be formed. As long as the connection subsists between his reason and his self-love, his opinions and his passions will have a reciprocal influence on each other; and the former will be objects to which the latter will attach themselves. The diversity in the faculties of men, from which the rights of property originate, is not less an insuperable obstacle to a uniformity of interests. The protection of these faculties is the first object of government. From the protection of different and unequal faculties of acquiring property, the possession of different degrees and kinds of property immediately results; and from the influence of these on the sentiments and views of the respective proprietors, ensues a division of the society into different interests and parties. …
The apportionment of taxes on the various descriptions of property is an act which seems to require the most exact impartiality; yet there is, perhaps, no legislative act in which greater opportunity and temptation are given to a predominant party to trample on the rules of justice. Every shilling with which they overburden the inferior number, is a shilling saved to their own pockets. …
Hence it is that such democracies have ever been spectacles of turbulence and contention; have ever been found incompatible with personal security or the rights of property; and have in general been as short in their lives as they have been violent in their deaths. Theoretic politicians, who have patronized this species of government, have erroneously supposed that by reducing mankind to a perfect equality in their political rights, they would, at the same time, be perfectly equalized and assimilated in their possessions, their opinions, and their passions.
What an eloquent defense of private property and economic liberty and a rejection of communalism. Madison not only doesn’t apologize for differences in capacities among human beings, but celebrates them, going so far as to say that protecting these differences is the first object of government. Wow. Would such a statement not be countercultural on our college campuses, among other venues, today? Not only that, but he seems to connect the government’s protection of these “different and unequal faculties of acquiring property” to the inevitable consequence that men will possess “different degrees and kinds of property.” So he’s saying that differences in outcomes is not a necessary evil, but something to be desired and protected. I infer this is not because he believes it's inherently wonderful that some people will prosper more than others, but that a system that allows for it is essential to liberty and the greatest prosperity. How utterly refreshing – (refreshing, though penned some two and a half centuries years ago).! As an extra delicious smackdown of modern liberalism, Madison clearly denounced here, as elsewhere in the Federalist, pure democracy for the additional reasons that it is incompatible with liberty and a more equitable division of property.
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Jun '10
Re: What Does Madison Teach Us About Wealth Redistribution?
Thank you , Mr. Limbaugh. In discussing socialism with liberals, I often times find. in lieu of our great founder, Madison, that Darwin helps to gain their ear and mind. However one believes that life initially began, one cannot deny that at some point during the process evolution did occur. Liberals love Darwin much more than Madison, so using one of their own icons is helpful. Pointing to the natural phenomenon of survival of the fittest, it is logical to stipulate that any economic /social system that bends against Man's natural desire to achieve and overcome goes against His very DNA. As such it is anti-nature and bound to fail. Capitalism, even with its flaws is by far the most natural system for Man who inherently strives for freedom and independence. It is noble to wish to help those with lesser abilities and certainly with afflictions, but if we allow that the majority of mankind is of this weaker nature and actually encourage this weakness by subjugating our strongest to their will and needs, we will, by choice, relegate mankind into a weaker species by the same evolutionary process that made us kings of our Earth.
Edited on Nov 27, 2010 at 6:17pmOct '10
Re: What Does Madison Teach Us About Wealth Redistribution?
It is also true of all systems, really. That any bias introduced tends to restrict the system from finding its optimum balance. By not protecting the differentiation, you prevent the best outcome. Madison says it much better than I, obviously.
Sep '10
Re: What Does Madison Teach Us About Wealth Redistribution?
Mr. Limbaugh - What an eloquent defense of private property and economic liberty and a rejection of communalism. But I'm wondering about several practicalities. Do professional libertarians concern themselves with the hollowing out of America's middle class? Or that the fellows on Wall Street seem to extraordinarily benefit from globalization while much of the country suffers from it.
Re: What Does Madison Teach Us About Wealth Redistribution?
Patrick: Thanks. I am not a Libertarian, btw. But I have long been skeptical of the left's mantra that the middle class is shrinking (not to deny the overall economic decline of the past two years). Clinton employed that general theme to denounce the Reagan years, and libs ignored all evidence of robust economic growth during W's years simply by saying the rich were getting richer, the poor poorer and the middle class was shrinking. Let me give you a few links and also suggest that such criticisms implicitly contend that counter-capitalistic and other lib solutions would improve the lot of the Middle Class -- which is highly suspect. On that point, see this piece. And, see this, this, this, this and this, challenging the assumption that the Middle Class is worse off than before.
Sep '10
Re: What Does Madison Teach Us About Wealth Redistribution?
Thanks for this great piece on Madison and his arguments against commulism. Just this weekend I took "The Federalist" off my bookshelf and began reading the introduction. Haven't gotten to #10 yet, but you have certainly whetted my appetite to do so.
Unfortunately, this kind of thinking does not end in the market place. It also pervades in the classroom at all levels of education. We can't make little Johnny feel bad because Bill is smarter or simply works harder to achieve, so lets keep Bill from achieving his potential academically.
Politically, one problem we have is that a rather large ratio of the electorate do not pay taxes and receive some kind of entitlement from the government. This is why we have a lot of work ahead of us to turn to tide of socialism in this country back to capitalism.
I believe our best hope is by educating the public, but how can we get them to turn off the TV, put down their blackberries and actually read something of value? Must we do it one person at a time, or is there a way to reach larger numbers of people?
Re: What Does Madison Teach Us About Wealth Redistribution?
Even the warnings about paper money seem uncannily prescient, don't they.
Sep '10
Re: What Does Madison Teach Us About Wealth Redistribution?
David Limbaugh
Patrick: Thanks. I am not a Libertarian, btw. But I have long been skeptical of the left's mantra that the middle class is shrinking (not to deny the overall economic decline of the past two years). Clinton employed that general theme to denounce the Reagan years, and libs ignored all evidence of robust economic growth during W's years simply by saying the rich were getting richer, the poor poorer and the middle class was shrinking. Let me give you a few links and also suggest that such criticisms implicitly contend that counter-capitalistic and other lib solutions would improve the lot of the Middle Class -- which is highly suspect. On that point, see this piece. And, see this, this, this, this and this, challenging the assumption that the Middle Class is worse off than before. · Nov 27 at 8:30pm
Thanks. I've skimmed the last five links and, as you say, they challenge the notion that the middle class has been hollowed out. But skeptic me needs to think more about them.
Re: What Does Madison Teach Us About Wealth Redistribution?
Patrick in Albuquerque
Thanks. I've skimmed the last five links and, as you say, they challenge the notion that the middle class has been hollowed out. But skeptic me needs to think more about them. · Nov 28 at 8:11am
Yes, and I acknowledge I'm no expert on this middle class issue and realize there are two sides to this. I want to study it more too. I'm a bit surprised more hasn't been written by conservatives to refute the charge. I briefly researched this to find the links, but couldn't find much from Heritage, though I may be looking in the wrong places. I've e-mailed one of the gurus there and asked him if he could edify. I await his response. My friend Larry Kudlow should write about this, if he hasn't already.
Edited on Nov 28, 2010 at 9:07amRe: What Does Madison Teach Us About Wealth Redistribution?
Patrick: In one of the comments above I tried to make the point that libs have tried to distract from Republican led economic successes by singling out one particular category or statistic by which they could undermine the balance of the positive evidence. That, I believe, is what they have done with this middle class argument. When you think about it, it's just another variation of their class warfare. And I think it's based on skewed data and distorted analysis, as noted.
I wanted to make provide another example that is analogous. This is purely from memory, but didn't Dems deny the Bush "goldilocks" economy (to borrow from Larry Kudlow), by pointing to what they called a "jobless recovery?" How is that working out for them now?
Edited on Nov 28, 2010 at 9:33amJun '10
Re: What Does Madison Teach Us About Wealth Redistribution?
I think it was the first year or two after the tax cuts were passed, the Dems and their media counterparts called the resulting end of the recession a "jobless recovery". Unemployment was between 6 and 7 percent in 2003/2004. After the full effects of the tax cuts on ALL Americans took hold, unemployment dropped to below 5% for '05,'06',and '07.
I believe the country would love to see even that terrible 7% rate at this point.
Sep '10
Re: What Does Madison Teach Us About Wealth Redistribution?
David Limbaugh: Patrick: In one of the comments above I tried to make the point that libs have tried to distract from Republican led economic successes by singling out one particular category or statistic by which they could undermine the balance of the positive evidence. That, I believe, is what they have done with this middle class argument. When you think about it, it's just another variation of their class warfare. And I think it's based on skewed data and distorted analysis.
I wanted to make provide another example that is analogous. This is purely from memory, but didn't Dems deny the Bush "goldilocks" economy (to borrow from Larry Kudlow), by pointing to what they called a "jobless recovery?" How is that working out for them now? · Nov 28 at 9:32am
Edited on Nov 28 at 09:33 am
I'm a fan of Kudlow and am interested in what he has to say. OTOH, I remember that he was saying how great the economy was doing far into 2008.
Not to pour gasoline on the fire, but the left is also talking about the growth of income inequality. And using words like plutocracy and oligarchy.
Aug '10
Re: What Does Madison Teach Us About Wealth Redistribution?
Patrick in Albuquerque
Not to pour gasoline on the fire, but the left is also talking about the growth of income inequality. And using words like plutocracy and oligarchy.
Are those talking about income inequality acknowledging the difference between the income distribution as a statistical artifact and the income history of real people? Do they acknowledge that income is not the same as wealth?
As for the words plutocracy and oligarchy, well, they've always been using those words, haven't they? Are the words more true now than they usually are, and if so, is it the result of too free a market or too unfree a market? (There is nothing quite like a big government's typical incestuous relationship with favored businesses for creating plutocrats and oligarchs.)
Also, I wonder as a purely general issue: to what extent is "middle class" merely an economic category and to what extent is it also a cultural category? If it is in large part a cultural category, haven't leftists been doing their best to undermine the middle class ("narrow-minded bourgeois values") for years? And if so, why should they lament, rather than celebrate, its "demise"?
Edited on Nov 28, 2010 at 12:19pmRe: What Does Madison Teach Us About Wealth Redistribution?
Midget Faded Rattlesnake
Patrick in Albuquerque
Not to pour gasoline on the fire, but the left is also talking about the growth of income inequality. And using words like plutocracy and oligarchy.
Are those talking about income inequality acknowledging the difference between the income distribution as a statistical artifact and the income history of real people? Do they acknowledge that income is not the same as wealth?
Midget: Thanks for the link to the great Thomas Sowell column, or should I say, the column by the great Thomas Sowell? Yes, the latter. Anyway, I urge everyone to read it -- it sure does make a difference when you consider that people move in and out of tax brackets. The more meaningful data are those that track real people, as opposed to income categories, as Midget points out.
And, at the risk of incurring the wrath of (and a reprimand from) the hyperbole Nazis, let me answer the final question in your post, "why should (leftists) lament, rather than celebrate its 'demise'?", thusly: Their lament is most likely just political opportunism.
Sep '10
Re: What Does Madison Teach Us About Wealth Redistribution?
Midget Faded Rattlesnake
Patrick in Albuquerque
Not to pour gasoline on the fire, but the left is also talking about the growth of income inequality. And using words like plutocracy and oligarchy.
Are those talking about income inequality acknowledging the difference between the income distribution as a statistical artifact and the income history of real people? Do they acknowledge that income is not the same as wealth?
Also, I wonder as a purely general issue: to what extent is "middle class" merely an economic category and to what extent is it also a cultural category? If it is in large part a cultural category, haven't leftists been doing their best to undermine the middle class ("narrow-minded bourgeois values") for years? And if so, why should they lament, rather than celebrate, its "demise"? · Nov 28 at 12:15pm
Edited on Nov 28 at 12:19 pm
Once I get children on airplanes I'll spend more time with the links provided by you and Mr. Limbaugh. But in contrast with the links provided by Mr. Limbaugh, a quick skim of the Sowell article leaves me with a feeling of obfuscation rather than illumination.
Sep '10
Re: What Does Madison Teach Us About Wealth Redistribution?
As for Dr. Sowell, he falls prey to the same difficulty with statistics that he bemoans. He says "Income, for example, is not the same as earnings, and neither is the same as the economic resources on which people's standard of living is based." The problem for his argument is that the higher a person's income/earnings the higher will be his (lifetime) economic resources. (individuals are well capable of screwing that up of course.) Thus income inequality in earnings/income will result in wealth inequality. Second, consider his argument toward the end of his piece about income transfer to the poor. If the argument is true - and I don't concede the truth of it - then it is the income transfers that are lessening the inequality of income. Would we on the right want to take away the income transfers? For this conservative, it's not black and white. Bottom line: IMHO Sowell's piece is not supportive MFR's position.
Aug '10
Re: What Does Madison Teach Us About Wealth Redistribution?
Patrick in Albuquerque
But in contrast with the links provided by Mr. Limbaugh, a quick skim of the Sowell article leaves me with a feeling of obfuscation rather than illumination.
If you've only skimmed the article, it's no wonder you feel confused. I found that in these pieces, it helps to follow each word carefully to be sure of what's going on.
I don't think Dr Sowell is as easy prey as you take him for. There is no problem with differentiating income, earnings, and economic resources.
Saying that they are different is not saying that there can be no relationship between them. The relationship may also be more complicated than you appear to be supposing.
(1/2)
Edited on Nov 28, 2010 at 4:37pmAug '10
Re: What Does Madison Teach Us About Wealth Redistribution?
Here's an easy example, Patrick, of how income and wealth may end up different. Pardon me if it's too simple for you -- perhaps if you're rushed in your writing, you sound more confused about the issue than you really are:
Suppose my neighbor's annual income is consistently only half of mine, but through his thrift and ingenuity, he manages to save (invest) twice as much as I do every year. Over several years, my neighbor's wealth easily outstrips my own, despite his having an income only half of mine.
Here's another example distinguishing income, investments, and financial resources:
Suppose I'm the child of a reasonably well-off family, and through some disability or sickness, or because I'm a girl who goes straight from school into stay-at-home motherhood, I never hold a paying job. Also suppose I have no investments in my name. I remain a financial dependent of my family my whole life, with access to the economic resources they share with me. So I have zero lifetime income. Zero investments. But I do have economic resources.
(2/2)
Edited on Nov 28, 2010 at 5:11pmOct '10
Re: What Does Madison Teach Us About Wealth Redistribution?
Do you want China to continue flooding us with imports? I'm guessing you live in one of the coastal cities--you live in an economic surplus, and thus feel entitled to play with us deficit people like God.
There is no difference between our situation with China--where we get poorer and they richer--and liberal's approach to solving economic imbalances. You can only redistribute wealth if it raises productivity; education and healthcare are pretty much all you can do.
(And for the record, I happen to believe China is doing a lot to reduce it's imbalance with us, and in general is being very nice--especially compared to, say, Germany vs Europe. The Chinese analogy is just the most convenient to use)
Oct '10
Re: What Does Madison Teach Us About Wealth Redistribution?
And yes, I support universal healthcare.
I also have a lot of friends from the many nations that practice consumer-oriented, private universal healthcare (even Briton is trying to creating a "social enterprise sector" of non-profit HMO-type foundations).
Conveniently, liberals always leave that part out (most nations have decided they dislike government-run healthcare--why do we keep discussing the few that haven't?)
Oct '10
Re: What Does Madison Teach Us About Wealth Redistribution?
Or: Trade is mutually beneficial *when balanced.* I.e. when it involves two goods or services, not a disproportionate amount of debt.
People do not get wealthier if you flood them with money. I.e. they aren't producing anything, and real wealth (and incomes) are tied to productivity. Those of us from "deficit" communities really, really hate the way liberals treat us like peons, and each other like Gods.