How modern Liberals view Economic Justice

FDRCigarBy Jim Sullivan

The term “liberal” has a four centuries long history from the Enlightenment through today, and involves philosophies ranging from “classical liberalism,” which would be considered conservative by today’s standards, to “modern liberalism” based on the ideas and policies of Franklin D. Roosevelt.  Since we live in the modern age, we use the term to mean modern liberalism, even as we recognize that the term “liberal” continues to evolve and change.

Modern liberals see economic justice as the allocation of economic benefits to participants in an economy in a way that avoids extremes of wealth and poverty.    Modern liberals ask: Is it just (or fair) for some in our society to luxuriate in extremes of wealth, while others suffer in extreme poverty?  The conservative or libertarian answer to this question is, yes, it is fair to permit extremes of wealth and poverty because the rich have earned their wealth through thrift, hard work, and by taking entrepreneurial risks.  This reasoning is embodied in the philosophy of Social Darwinism which holds that great wealth is deserved, and extreme poverty is allowed, based upon an economic version of “survival of the fittest.”   The Social Darwinist philosophy has long been discredited, but conservatives and libertarians continue to espouse it in one form or another.  Modern liberals, while disagreeing with the philosophy of Social Darwinism, nevertheless agree that successful businessmen and women should indeed be rewarded for their hard work, but not to the degree of allowing extreme wealth or poverty.

A careful observer of American society would admit that economic success in our capitalist system involves, in addition to hard work, an element of luck.   No entrepreneur or businessperson can completely control the risks and uncertainties associated with the economy he or she lives and works in–a taxpayer funded government is required to help reduce those risks through statutes and regulations.  In addition, economic success requires that to achieve their economic goals entrepreneurs must make use of common social goods such as public roads, clean air, licensed drivers and registered vehicles, and a system of effective law enforcement funded by taxpayers.  The very economy that successful entrepreneurs operate in is created by consumer, business, and government spending supported and protected in important ways by government policies and laws, e.g., contract law, which are funded by taxpayers.   So entrepreneurs make great use of government services funded by taxpayers (except those taxpayers wealthy enough to shelter their profits via tax loopholes and offshore tax havens).  Modern liberals recognize these facts, while conservatives and libertarians choose to ignore them.

It is important to note that in some studies of selected countries, some researchers have found higher rates of health and social problems (crime, mental illness, physical illness, corruption, teen births, etc.) in countries studied with greater economic  inequality, as well as  lower rates of social goods (life expectancy, social mobility, status of women, etc.).  Thus there is evidence that inequality of extreme wealth and poverty is personally and socially harmful.

To avoid the dysfunctionality of extremes of wealth and poverty in our economy and society, modern American Liberals have created important social programs to help reduce economic inequality.  These programs include Social Security, Medicare, and unemployment benefits.  Conservatives, and especially libertarians, resent having their taxes pay for these programs and strive mightily to reduce or eliminate them.  Modern liberals view such social programs as economically just in that they mitigate elder poverty due to greatly reduced income and significantly higher age-related medical expenses, and help those unable or limited in their ability to support themselves, such as the severely disabled and long-term unemployed in severe economic downturns such as we are currently experiencing.  Supposedly the recent recession is over.  That is debatable, since the recovery is termed by many a “jobless recovery.”  That sounds like an oxymoron to me.  Either way, unemployment is still high.

Libertarians and many conservatives claim that government has no business “interfering” in these situations, and that free market individualism will sort it out.   This claim is simply false– without Social Security and Medicare legions of the elderly would live below the poverty line, and without unemployment insurance, we would have the middle to long term unemployed selling apples on street corners, as they did in the Great Depression.  Moreover, conservatives and libertarians hold that family relatives and private welfare agencies (e.g., churches and charities) will fill the economic gaps and suffering created by reduced economic circumstances and disability.  But relatives and private social welfare agencies and charities simply do not have the economic resources to assist the elderly, disabled, and unemployed on an effective and consistent basis.

Nowhere in this article have I written that modern Liberalism is by definition a better philosophy than conservatism, libertarianism, or Social Darwinism.  Nor have I presented a justification of modern liberalism based on humanitarian values.  Rather I have written an objective view of modern liberalism based on economic fact, logic and reasoned argument.   Perhaps this approach will help clear the fog surrounding the argument between those who think extremes of wealth and poverty are justified and those who do not.

Jim Sullivan is a retired businessman with graduate degrees in political science and business.  He lives in Ventura with his wife Juliette and two family cats.

Editor’s note: Mr. Sullivan chose not to address social issues in his article, because he does not regard them as something within his competence and desire to address. However, he has agreed to write a sequel to this piece to explore and contrast today’s situation to his portrayal of Economic Justice here.

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