Comments on: The intellectual uses of ‘liberty’ and ‘equality’ http://andrewnorton.info/2008/04/the-intellectual-uses-of-liberty-and-equality/ Observations from Carlton's Lone Classical Liberal Mon, 01 Dec 2008 20:47:40 +0000 http://wordpress.org/?v=2.5.1 By: backroom girl http://andrewnorton.info/2008/04/the-intellectual-uses-of-liberty-and-equality/#comment-12626 backroom girl Tue, 08 Apr 2008 00:38:56 +0000 http://andrewnorton.info/blog/2008/04/06/the-intellectual-uses-of-liberty-and-equality/#comment-12626 And I definitely agree with Andrew when he concludes that "The number abstracts too far from the underlying reality to be useful in judging whether or not apparent trends are good, bad, or neither." And I definitely agree with Andrew when he concludes that

“The number abstracts too far from the underlying reality to be useful in judging whether or not apparent trends are good, bad, or neither.”

]]> By: backroom girl http://andrewnorton.info/2008/04/the-intellectual-uses-of-liberty-and-equality/#comment-12642 backroom girl Tue, 08 Apr 2008 00:37:02 +0000 http://andrewnorton.info/blog/2008/04/06/the-intellectual-uses-of-liberty-and-equality/#comment-12642 I'd agree with you Leopold, I think Australia is travelling pretty well compared with a lot of other comparable countries (not that I have the benefit of first hand experience in most cases, more's the pity). And even if we have more "inequality" than at some halcyon point in the past, I reckon that's compensated by increased freedom to choose in many spheres of life (including how much income you earn). Now I'm the first to admit that I am speaking from a well-educated, well-remunerated middle-class standpoint, but I really don't believe that today's working class really have that much worse a life now than the working class in the good old days. And on measures of real income and some measures of relative income, the non-working class are largely better off as well. I’d agree with you Leopold, I think Australia is travelling pretty well compared with a lot of other comparable countries (not that I have the benefit of first hand experience in most cases, more’s the pity). And even if we have more “inequality” than at some halcyon point in the past, I reckon that’s compensated by increased freedom to choose in many spheres of life (including how much income you earn).

Now I’m the first to admit that I am speaking from a well-educated, well-remunerated middle-class standpoint, but I really don’t believe that today’s working class really have that much worse a life now than the working class in the good old days. And on measures of real income and some measures of relative income, the non-working class are largely better off as well.

]]> By: NPOV http://andrewnorton.info/2008/04/the-intellectual-uses-of-liberty-and-equality/#comment-12641 NPOV Mon, 07 Apr 2008 23:47:00 +0000 http://andrewnorton.info/blog/2008/04/06/the-intellectual-uses-of-liberty-and-equality/#comment-12641 Well it's not a problem that Australia is suffering from at the moment anyway, as I understand it. But if a change in immigration policy were to attract a large number of low-skilled workers willing to work at much lower wages than existing native workers, then I think there is a role for the state to play in ensuring that lower-paid native workers are not left worse off - after all, they're working just as productively as before. Logically, the money to compensate them (or to pay for their training into better paid jobs) should come from those that are benefitting the most from the cheap labour - which is probably the consumers purchasing the end products at lower prices: i.e. pretty much all of us. Well it’s not a problem that Australia is suffering from at the moment anyway, as I understand it. But if a change in immigration policy were to attract a large number of low-skilled workers willing to work at much lower wages than existing native workers, then I think there is a role for the state to play in ensuring that lower-paid native workers are not left worse off - after all, they’re working just as productively as before. Logically, the money to compensate them (or to pay for their training into better paid jobs) should come from those that are benefitting the most from the cheap labour - which is probably the consumers purchasing the end products at lower prices: i.e. pretty much all of us.

]]> By: Leopold http://andrewnorton.info/2008/04/the-intellectual-uses-of-liberty-and-equality/#comment-12625 Leopold Mon, 07 Apr 2008 23:43:49 +0000 http://andrewnorton.info/blog/2008/04/06/the-intellectual-uses-of-liberty-and-equality/#comment-12625 I think your paraphrase is better put than my original phrasing, Andrew! ---- I agree constructing indices is difficult, as is determining an acceptable 'absolute' level of equality. Personally, I have to admit I tend to fall back on comparing us with other countries with similar cultural backgrounds (UK, USA, Canada, Ireland, New Zealand) and my feeling (based on various measures) is that, compared with other countries with a similar cultural/social bedrock to us, we are doing pretty well, mainly because of the good policies we have followed for the last 25 years. As to whether or not we should have more or less equality - depends on the costs and benefits of any particular measure as far as I'm concerned. I think your paraphrase is better put than my original phrasing, Andrew!
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I agree constructing indices is difficult, as is determining an acceptable ‘absolute’ level of equality. Personally, I have to admit I tend to fall back on comparing us with other countries with similar cultural backgrounds (UK, USA, Canada, Ireland, New Zealand) and my feeling (based on various measures) is that, compared with other countries with a similar cultural/social bedrock to us, we are doing pretty well, mainly because of the good policies we have followed for the last 25 years. As to whether or not we should have more or less equality - depends on the costs and benefits of any particular measure as far as I’m concerned.

]]> By: backroom girl http://andrewnorton.info/2008/04/the-intellectual-uses-of-liberty-and-equality/#comment-12624 backroom girl Mon, 07 Apr 2008 23:37:20 +0000 http://andrewnorton.info/blog/2008/04/06/the-intellectual-uses-of-liberty-and-equality/#comment-12624 "Yes, it will push down real wages, but with the right transfer schemes in place, it shouldn’t make anybody worse off - that’s my point. " NPOV, in Australia we do have a fairly comprehensive set of income transfers to top-up low levels of earnings whether from part-time work or sometimes full-time work. But if you want people to be no worse off if their wages go down, that implies that you favour a scheme that adjusts income dollar for dollar (either up or down). Where does that leave work incentives? “Yes, it will push down real wages, but with the right transfer schemes in place, it shouldn’t make anybody worse off - that’s my point. ”

NPOV, in Australia we do have a fairly comprehensive set of income transfers to top-up low levels of earnings whether from part-time work or sometimes full-time work. But if you want people to be no worse off if their wages go down, that implies that you favour a scheme that adjusts income dollar for dollar (either up or down). Where does that leave work incentives?

]]> By: NPOV http://andrewnorton.info/2008/04/the-intellectual-uses-of-liberty-and-equality/#comment-12627 NPOV Mon, 07 Apr 2008 21:40:48 +0000 http://andrewnorton.info/blog/2008/04/06/the-intellectual-uses-of-liberty-and-equality/#comment-12627 Yes, it will push down real wages, but with the right transfer schemes in place, it shouldn't make anybody worse off - that's my point. There's no practical reason that anything that benefits the economy as a whole shouldn't allow everybody to benefit (or at least not be disadvantaged). Whether it can be done by any means other than income redistribution I'm not sure. Yes, it will push down real wages, but with the right transfer schemes in place, it shouldn’t make anybody worse off - that’s my point. There’s no practical reason that anything that benefits the economy as a whole shouldn’t allow everybody to benefit (or at least not be disadvantaged). Whether it can be done by any means other than income redistribution I’m not sure.

]]> By: JC http://andrewnorton.info/2008/04/the-intellectual-uses-of-liberty-and-equality/#comment-12636 JC Mon, 07 Apr 2008 13:19:46 +0000 http://andrewnorton.info/blog/2008/04/06/the-intellectual-uses-of-liberty-and-equality/#comment-12636 <i>And I’d argue any modern capitalist economy should benefit from an influx of cheap labour.</i> A sudden influx if cheap labor has the effect of pushing down real wages. it may also effect the capital to labor ratio. And I’d argue any modern capitalist economy should benefit from an influx of cheap labour.

A sudden influx if cheap labor has the effect of pushing down real wages. it may also effect the capital to labor ratio.

]]> By: Brendan http://andrewnorton.info/2008/04/the-intellectual-uses-of-liberty-and-equality/#comment-12635 Brendan Mon, 07 Apr 2008 09:46:46 +0000 http://andrewnorton.info/blog/2008/04/06/the-intellectual-uses-of-liberty-and-equality/#comment-12635 If inequality of consumption is a more useful measure than inequality of income. Then <a href="http://www.springerlink.com/content/v13hw1370808/?p=5c30e366f8854046aafae4152b719985&pi=9" rel="nofollow">inequality Of happiness</a> must be even more useful. If inequality of consumption is a more useful measure than inequality of income. Then inequality Of happiness must be even more useful.

]]> By: NPOV http://andrewnorton.info/2008/04/the-intellectual-uses-of-liberty-and-equality/#comment-12640 NPOV Mon, 07 Apr 2008 08:42:32 +0000 http://andrewnorton.info/blog/2008/04/06/the-intellectual-uses-of-liberty-and-equality/#comment-12640 Why would Colombia have an advantage growing fruits and vegies that are bred for temperate/Mediterranean climate zones (i.e., most of them)? And I'd argue any modern capitalist economy should benefit from an influx of cheap labour. Why would Colombia have an advantage growing fruits and vegies that are bred for temperate/Mediterranean climate zones (i.e., most of them)?
And I’d argue any modern capitalist economy should benefit from an influx of cheap labour.

]]> By: JC http://andrewnorton.info/2008/04/the-intellectual-uses-of-liberty-and-equality/#comment-12633 JC Mon, 07 Apr 2008 08:40:42 +0000 http://andrewnorton.info/blog/2008/04/06/the-intellectual-uses-of-liberty-and-equality/#comment-12633 I put this up at club troppo. A couple of economists at the Dallas Fed took a different approach in determining inequality. They took the approach of measuring consumption patterns rather than income and found the US is far less unequal than what the income side of these studies suggest. I t’s true that the share of national income going to the richest 20 percent of households rose from 43.6 percent in 1975 to 49.6 percent in 2006, the most recent year for which the Bureau of Labor Statistics has complete data. Meanwhile, families in the lowest fifth saw their piece of the pie fall from 4.3 percent to 3.3 percent. Income statistics, however, don’t tell the whole story of Americans’ living standards. Looking at a far more direct measure of American families’ economic status — household consumption — indicates that the gap between rich and poor is far less than most assume, and that the abstract, income-based way in which we measure the so-called poverty rate no longer applies to our society. The top fifth of American households earned an average of $149,963 a year in 2006. As shown in the first accompanying chart, they spent $69,863 on food, clothing, shelter, utilities, transportation, health care and other categories of consumption. The rest of their income went largely to taxes and savings. …………………… So, bearing this in mind, if we compare the incomes of the top and bottom fifths, we see a ratio of 15 to 1. If we turn to consumption, the gap declines to around 4 to 1. A similar narrowing takes place throughout all levels of income distribution. The middle 20 percent of families had incomes more than four times the bottom fifth. Yet their edge in consumption fell to about 2 to 1. http://www.nytimes.com/2008/02/10/opinion/10cox.html?_r=1&ref=opinion&oref=slogin The biggest concern about the bottom rung is to determine if their level consumption is impaired compared to the upper levels of the economic ladder. If that’s the case consumption figures are showing they aren’t as badly off as the income stats present. So the real issue should not be income inequality. These studies ought to be premised on consumption. It’s not how much you have, it’s how much are you consuming compared to others that really counts…. and if that level of consumption is an acceptable standard. I put this up at club troppo.

A couple of economists at the Dallas Fed took a different approach in determining inequality. They took the approach of measuring consumption patterns rather than income and found the US is far less unequal than what the income side of these studies suggest.
I
t’s true that the share of national income going to the richest 20 percent of households rose from 43.6 percent in 1975 to 49.6 percent in 2006, the most recent year for which the Bureau of Labor Statistics has complete data. Meanwhile, families in the lowest fifth saw their piece of the pie fall from 4.3 percent to 3.3 percent.
Income statistics, however, don’t tell the whole story of Americans’ living standards. Looking at a far more direct measure of American families’ economic status — household consumption — indicates that the gap between rich and poor is far less than most assume, and that the abstract, income-based way in which we measure the so-called poverty rate no longer applies to our society.
The top fifth of American households earned an average of $149,963 a year in 2006. As shown in the first accompanying chart, they spent $69,863 on food, clothing, shelter, utilities, transportation, health care and other categories of consumption. The rest of their income went largely to taxes and savings.
…………………… So, bearing this in mind, if we compare the incomes of the top and bottom fifths, we see a ratio of 15 to 1. If we turn to consumption, the gap declines to around 4 to 1. A similar narrowing takes place throughout all levels of income distribution. The middle 20 percent of families had incomes more than four times the bottom fifth. Yet their edge in consumption fell to about 2 to 1.
http://www.nytimes.com/2008/02/10/opinion/10cox.html?_r=1&ref=opinion&oref=slogin
The biggest concern about the bottom rung is to determine if their level consumption is impaired compared to the upper levels of the economic ladder. If that’s the case consumption figures are showing they aren’t as badly off as the income stats present.
So the real issue should not be income inequality. These studies ought to be premised on consumption. It’s not how much you have, it’s how much are you consuming compared to others that really counts…. and if that level of consumption is an acceptable standard.

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