Our Fair Share

Mr. Foley, a partner in Schwabe, Williamson, Wyatt, Moore & Roberts, practices law in Portland, Oregon.

A constant cry peals across the land: “give us our fair share.” A variety of results is expected by these claimants. For example, advocates may seek “a fair share” of manufacturing profits or insured employment for the workers, a reduced rate for utility users, “tenant rights” for inhabitants of rented premises, subsidized bus fares and public transit systems, guaranteed health and medical insurance coverage, and a whole host of other demands. This essay proposes an analysis of the meaning underlying this clamor.

Initially, reflect upon the contention that the public or a segment thereof deserves “a fair share.” First, the call presumes that the speaker merits a different or additional right. Second, the proposition presupposes that such right belongs to the seeker as a matter of entitlement and as a principle of fundamental justice. Third, the appeal posits the propriety of limiting the corresponding rights of other persons in favor of the orator, or fails to recognize that such an exchange necessarily takes place in the stated situation. These three presumptions generally prove incorrect.

Stripped to bare essentials, proponents of the concept of “a fair share” rely upon the doctrine of entitlement to justify transfer payments and transferred rights. The foundation of entitlement rests upon what Dr. Gary North so aptly describes as “the politics of envy.”[1] “A” desires something possessed by “B.” The strictures against coveting seem less enforceable than those condemning theft, so “A” dreams and schemes for a method of relieving “B” of his liberty or his property.[2] The modern method is disarmingly simple: “A,” alone if he possesses sufficient power, or in league with companions similarly situated if he does not, effects his dreams and realizes that which he covets by force of law. He converts his desires into edicts, secures the stamp of official approval upon them and enjoys the fruits of someone else’s labors.

Unfortunately for “A,” the human creature contains innate social-moral-psychological responses against wrongdoing, even when sanctioned by law. At least some of the “A’s” of the world feel uneasy about their gains achieved at the benefit of others. To alleviate these symptoms, they turn to the medicine cabinet for some doctrinal relief. There they discover “entitlement” which, if not possessing the curative powers of penicillin, at least offers the temporary relief of aspirin.

The Doctrine of Entitlement

Entitlement refers to the postulate, expressed in varying ways and with differing degrees of intensity, that in addition to the propriety of state-mandated transfer payments to achieve egalitarianism or some other purportedly good end, both the state and the creative segments of society owe these distributions to the recipients as a matter of right. One can debate whether the term “right” is connotative or conclusive in nature. Whatever the outcome of that controversy, those who benefit from the productive efforts of others tend to demand continuation and increase of these payments in the grand names of fairness, justice and equality. Reduced to essentials, this justification translates into a concern for their own position with no consideration for “fairness and justice” to the unwilling donor.

The doctrine of entitlement contains two conceptual errors: It assumes propriety of the transfer and it presupposes the right of one to take from another. Neither assumption proves valid upon reflection and analysis.

First, contemplate propriety. What analysis deems it proper to take from a producer a portion of the value he has created for transfer to another? The concept of propriety conjures up notions of justice or fundamental fairness. One cannot condone such a taking or label it “fair” when viewed in light of the position of the producer except in situations where the producer has breached a voluntarily-entered agreement, carelessly caused a calamity to occur to another, or initiated aggression against some peaceful person. If fairness connotes equal and proper treatment of all parties to a transaction,[3] then the creator becomes the victim, and loses his property (created value) and a part of his freedom to boot. One can only conclude that the egalitarian wealth- spreader employs fairness and propriety in quite a one-sided and unreal sense reflecting his own social value judgment coercively applied to others.

Second, examine the concept of the overpowering right of the donee to deprive his victim of the product of the latter’s labors. Propriety concerns the appropriateness of governmental action; right relates to the appropriateness of individual action. No convincing argument can be offered in support of deprivation under the doctrine of entitlement in the absence of a consensual bargain or a negligent or intentional prior initiation of force by the current transferor.

Transfer Payments Deny Property Rights

Transfer payments consist of “property,” a brief means of expression defining value created by the efforts of the producer-owner. Property thus represents an extension of one’s very life, his power to create, his ability to choose his own destiny. Elimination of the potential to create and to retain human output necessarily enslaves an individual and reduces his humanity, his essential nature, which consists in part of the ability to make meaningful choices. The essence of all entitlement contentions must rest upon the proposition that the taker is more properly entitled to goods, services, and ideas than is the creator of those products.

What possible reason justifies a coerced transfer? In the lexicon of the modern egalitarian, equality as a principle mandates transfer payments to even out existing natural or artificial differences. Passing for the purposes of this essay the possibility of achieving enforced equality by any system of redistribution,[4] focus upon the philosophical aspects of the equation reveals the barrenness of the purported analysis.

The fair share advocate perceives the inequality of appearance and talents naturally attendant upon the human condition; he decries this individuality, which he views as unfair disparity, and urges dull and desolate sameness, the absolute of reduction to the lowest common denominator. Down with Haydn and Monet, with Voltaire and Confucius! Seek the gray identity of those crea tures who contribute little or nothing to creativity and culture. Unconsciously or intentionally, his every action leads necessarily and convincingly to this cheerless end.

At the base, two aspects undergirding egalitarianism appear: a presupposition to power and a denial of essential humanity. First, the seeker after enforced equality wishes to impose an orthodoxy upon everyone about him to fit them into his subjective mold. He knows only power; persuasion and rationality dissatisfy him because they lead inflexibly to consequences contrary to his preconceptions. Second, the egalitarian dislikes what he sees when he looks at humanity. He wishes not to alter those things within his puny power, such as the uplifting of man’s material and spiritual existence by the development of new labor-saving devices or the composition of a beautiful work of art. Instead, his quest is to achieve the opposite, by beating down those about him who display any degree of innovativeness or originality. Yet reflection reveals that the egalitarian position amounts to a stubborn denial of the essence of humanity: the awe of unique creation and the mechanism of meaningful choice which unavoidably leads to differences in outlook, ability, goals, and appearance.

The Statist Position

A root misconception colors the fair-share approach to entitlement: the belief that individual differences derived from the nature of man and by virtue of his individual choice-making attribute constitute a malevolence demanding eradication by collective coercive action. The statist presumes to know the course of action best suited for each person in society. He assumes the role of modifier of human nature, he imposes his own subjective standards upon unwilling citizens who fail to conform to his view, and he decides who in society deserves (is “entitled to”) a given share of production or created value. Nevertheless, he displays no special knowledge or training which qualifies him for this momentous task of decision-making which, in final analysis, should be better left to each individual actor as it affects his destiny.

Reduced to fundamentals, the traducer exhibits the modern tendency to elitism. No longer does mankind seek a Jeffersonian aristocracy of talent and virtue; the current aristocrat seeks power to the end of control of human lives. He understands the political and practical means of communication, manipulation, and subjugation, and he applies this knowledge to direct others to do his bidding. Whether well-or ill-intentioned, the elitist, a “dictocrat” in Leonard Read’s phrase,[5] reduces people entitled to a counting choice to pawns on a giant chessboard or puppets on a Pyrrhic stage.

The egalitarian becomes the elitist precisely because he pretends to possess the ability and the right, in addition to the power, to quell creativity and to channel human conduct into prescribed forms and institutions—and he does so by application of charged code-words such as entitlement which lend a degree of justification, authenticity, and validity to his endeavors. Entitlement is the mask, egalitarian is the appearance and the elitist is the reality in the play we witness today.

Those who quest for a fair share opine that they are entitled to something more and greater than that which they have produced—they wish to control part (or all) of the fruits of the labor and ingenuity of others. Thus, witness the teeming hordes who envy the entrepreneur who constructs a power plant, transformers and distribution lines in an effort to bring the wonders of electricity within reach of a fingertip. The multitudes convert this envy into a shrill or harsh insistence that they—the consumer—deserve special favors in the sense that they should pay less than market prices for the output generated by the dint of effort, stored labor and native genius of other individuals.

Or consider the prattle of renters who summon landlords to the dock in an effort to change the nature of the place of habitation without paying the price. Natural law decrees that every price must be paid, either by the buyer or the seller, by the producer or the user, by the owner or the tenant. Fair share advocates shunt the payment to the shoulders of others by employment of a juridical talisman.

Distributive Justice

The legal amulet employed consists of the distributive theory of social justice, the dogma devoted to effectuating entitlement in the satisfaction of envy. The distributive theory of social justice supplies the rationale “explaining” why income and value should be redistributed among members of a community. It suffers from the same root fallacies as the doctrine of entitlement and it partakes of the identical mistakes as the current corruption of equality into egalitarianism.

Whatever the intention of the purveyors of the doctrine, “distributive justice” cannot be classified properly as “neutral”—it implies to the reader or the listener that distribution of income, assets, resources, or things of value must take place by means of market intervention, and it further implies that some such distributive scheme relates to a concept of justice.

Society—that informal consensual grouping of persons—always determines the distribution of things of value. The propounder of the distributive theory uses force to mold recipients and their destiny; the believers in natural justice (respect for free nonaggressive choice) prefer the voluntary antics of the market. Under any term employed, the political-economic concept of distributive or social justice carries with it a meaning which implies both a power and a right residing in actors who do not produce a product to determine its ultimate use and enjoyment.

Even some avowed supporters of liberty needlessly “concede” that no rational method allows determination in the abstract of a superior method of distribution.[6] To the contrary, both abstractly (rationally) and empirically, a market system of creation, production, and delivery proves superior to any other scheme.[7] Really, only two possibilities exist:

(a) A market system wherein each participant “votes” his subjective value structure in a dollar democracy, by bidding the excess value he has created for the excess value he desires which someone else has produced, thereby determining not only what is produced but also how assets (incomes) are distributed;

(b) A command economy, wherein some or all choices are made by persons other than the producers and users, thereby artificially distributing or deflecting choices, assets, and income from those directly affected to those in power under the political apparatus.

Fair share egalitarians suffer from a dilemma which follows from two central facts: (1) Economic distinctions in an open society occur as a result of differences in aptitudes, motivations, and circumstances, but (2) government action to eliminate the differences entails such exclusive coercion that society ceases to be free:[8]

In an open society, attempts to eliminate, or even substantially to reduce, income differences extend coercive power, i.e., inequality of power between rulers and ruled. This also implies politicization of economic life, a situation in which economic activity depends largely on political decisions, and in which the incomes of people and their economic modus vivendi are prescribed principally by politicians and bureaucrats. How far-reaching is the required coercion and politicization of economic life will depend upon the degree of economic equality the rulers intend to achieve; they will depend also on the various aptitudes, motivations, and circumstances of the groups and individuals among whom economic differences are to be reduced.[9]

Thus, the egalitarian faces two counterproductive forces: first, political programs designed to level incomes or assets generally do nothing of the sort; instead, they shift income and assets from the productive to the politically powerful; second, redistribution of income and assets necessarily entails the use of force—because it contra-indicates the natural tendencies of human beings—to such a degree that it destroys the free society which makes possible the production of excess goods, services, and ideas to permit life at levels above poverty or mere existence.

Equality of Opportunity

Some thinkers supporting the “fair share” position rail against an inequality of opportunity. Such a contention merits attention despite its ambiguity and intended emotive appeal. By and large, human beings seize their own opportunity; it cannot be conveyed to them by an omnipotent government, any more than a loving father can insure that his progeny will perform well in business or the arts. In many instances, inequality of opportunity merely restates the natural and necessary uniqueness of human beings in ability, desire and other features.

In some instances, the challenge to inequality of opportunity conceals a dislike for inherited assets. Assets merely represent labor which has been stored and capitalized (made productive of future goods, services, and products) rather than consumed. The modern leveler, much like his seventeenth-century forebear, desires elimination of such differences so that each person in each generation starts afresh. Such a scheme presents a superficially appealing charm obscuring quite a wicked interior.

First, consider the absurdity of an extension of the leveler position: Would such a theorist require each individual to develop all machinery and all ideas from scratch, without building upon the accumulated wisdom of the past? If so, who among us could reinvent the wheel or even a pencil?[10]

Second, consider the necessary practical implications of the artifice: Would the egalitarian destroy all accumulated wealth (a great waste of costly and finite resources) or would he transfer it to someone else? The obvious answer, and one reflecting actual practice, is the latter alternative. Inheritance and estate taxes generally shift saved assets from the object of the producer’s affection to other, unrelated members of society who often do not create but do consume and, more importantly, vote for the political officials who undertake distribution. The doctrine justifying this social distribution of property: entitlement.

“Might Makes Right”

A more salient inquiry arises regarding the transfer of accumulated or inherited wealth to effect a leveling and “equality of opportunity,” when one considers the propriety of these transfers. Only one justification exists for a transaction which takes created value from the producer against his will and gives it to another more favored by the law—the doctrine of power or might-makes-right.

One accumulates wealth in one of two ways: by coercion or by contract. If a thug steals one million dollars from an individual or an enterprise, he has acquired great wealth by force of plunder.[11] If a creative man or woman renders services or produces labor-saving devices desired by many others and thus acquires one million dollars in trade value, he or she has acquired great wealth by contract—by bargains freely entered between individuals, each seeking to satisfy his desires according to his particular subjective value structures. The law can justly demand the return of loot to its rightful owner; it should not affect an involuntary transfer of freely, fairly, and nonfraudulently accumulated property to someone who did not create it.

Seemingly, the traducers of the market decry the entitlement of creators of value to their own creation. Instead of recognizing that accumulated wealth derived contractually usually results as the product of better choices, these myopic transfer agents attribute foul and malevolent deeds to the creators or their descendants. Yet the creation of wealth occurs precisely because man must predict what his fellow man will subjectively value, and some individuals prove more able predictors than others.

The person who makes the best usage of a finite resource, who offers the surest service, or thinks of the most innovative idea, by and large, will receive more trade goods (“money”) from his consumers (traders) than will someone less motivated and lacking in some qualities of prescience. While someone may suggest, subjectively, that a certain scion of one who has accumulated property does not deserve, or make good use of, that property, it does not lie within the rightful power of that other person to make that choice. The creator of value should be able to choose how to use his created value, who shall receive it, and under what circumstances. What other person possesses a higher claim?

The Moral Factor

A moral factor overrides the entire question. If every human choice constitutes a moral act, then the essence of morality (making the right choice between good and evil) resides in the power to choose meaningfully between alternatives. To the extent that the fair-share advocate obviates other individuals’ power to choose, he commits an immoral act even if his choice can be labeled “right”—and no one can apply that label effectively because no one other than the victimized actor who lost his choice can assess his subjective value under his conditions.

In comparing and contrasting justice and social justice, one writer finds them antithetical:

So-called social justice is man’s greatest injustice to man, anti-social in every respect; not the cement of society, but the lust for power and privilege and the seed of man’s corruption and downfall.

Finally, social justice in no way fits the claim of its advocates: an expression of mercy and pity. These virtues are strictly personal attributes and are expressed only in the voluntary giving of one’s own, never in the seizure and redistribution of someone else’s possessions.

Morally and ethically motivated citizens can condone a philosophy of so-called social justice only if they fail to see its terrible injustice.[12]

Social or distributive justice deities force and coerces peaceful people, robbing them of their choice-making ability. True justice expresses concern and respect for an individual’s non- aggressive free choice. Social justice exudes false sympathy and prattles about equality, all the while exhibiting the clenched fist of force. True justice accords with the ultimate morality of choice. What, then, is “our fair share”? It is precisely that which we create and acquire in non- aggressive manner during our tenure on this earth. It is nothing more and it is nothing less. []

1.   See Gary North, III Remnant Review (No. 19, October 6, 1976), p. 114; (No. 7, April 7, 1976), p. 38.

2.   He seldom seeks to deprive “B” of life any more because the “A’s” of the world recognize that death of a producer finally terminates production of those coveted goods, services, and ideas. So much better then to keep “B” alive and producing.

3.   Such a definition amounts to a tautology, given the common usage of the terms, e.g., what is proper is what is fair, and what is fair is what is proper.

4.   Professor Cotton M. Lindsay, in an introduction to Two Essays on Income Distribution and The Open Society (International Institute for Economic Research, Reprint Paper 4, January 1977), p. 1, writes: “And yet, detailed analysis of redistributional results of many government actions indicates that the direction of this income transfer is the reverse of what most people are alleged to regard as ‘fair.’ From the Social Security System and minimum wage legislation to government support of agriculrural prices and higher education, one sees an array of programs which generally end up serving individuals in the middle and upper-middle classes as primary beneficiaries. Taxes fall upon both the rich and the poor, but the poor are disproportionately underserved by these programs.”

5.   Leonard E. Read, The Love of Liberty, (Irvington-on-Hudson, N.Y.: The Foundation for Economic Education, Inc., 1975) especially Chapter 8, “The Roots of Concord and Discord,” pp. 46-52.

6.   Irving Kristol, “What is ‘Social Justice?” Wall Street Journal, August 12, 1976.

7.   This paper may not present the optimum place to debate this particular issue in depth. The works of Mises such as Human Action and the Bastiat trilogy seem apt places to commence a defense on this point. Ludwig von Mises, Human Action, 3rd rev. ed. (Chicago: Henry Regnery Co., 1966); Frederic Bastiat, Economic Harmonies, Economic Sophisms and Selected Essays on Political Economy (all published Princeton, N.J.: D. Van Nostrand Co., Inc., 1964).

8.   Peter T. Bauer, “Egalitarianism: Art of the Impossible,” The Times Literary Supplement (London, England: July 23, 1976).

9.   Ibid.

10.   See Leonard E. Read, “I, Pencil,” reprinted in The Freeman, November 1983.

11.   Strangely, the same opprobrium does not seem to attach to plunder achieved by operation of the law, as where those in authority employ the Federal Reserve System and the Treasury Department to milk citizens’ savings of several trillion dollars over forty years by means of the tax commonly termed inflation.

12.   Leonard E. Read, “Justice Versus Social Justice,” Who’s Listening? (Irvington-on-Hud-son, N.Y.: The Foundation for Economic Education, 1973), p. 97.