Equity Is Not An Evil Word

I saw some conservative pundit proposing “equity” is an “evil word” that causes communism and leads to war. Made me realize bad economics in the conservative style is not the only bad take on neoclassical welfare economics. Let’s discuss that this week.

The ethical half-theory of neoclassical welfare economics famously excludes ethical considerations relating to resolving interpersonal conflicts of preferences between people, the lion’s share of ethical thinking, an issue commonly referred to as an “equity” issue. “Equity” just means fairness, justice, ethical correctness relating to resolving interpersonal conflict. It’s a general concept that doesn’t really restrict one’s thinking about ethics, the basis on which one supposes interpersonal conflict should be resolved.

Real neoclassical welfare economics, in which the normative or the ethical content is meant to be relatively uncontroversial, cannot be used in isolation to make any real policy recommendation, it must be combined with exogenous normative, ethical inputs, say from voters. Those ethical issues involve the definition of economic power, the distribution of economic power, and the use of economic power to resolve particular interpersonal conflicts of preferences (extent of the market, when to use markets, when to use other mechanisms), etc. Anti-democracy bad economics in the conservative style deals with the ethical half-theory issue by slyly slipping in exogenous normative or ethical decisions and pretending or implying they’re part of neoclassical welfare economics, uncontroversial, etc. In anti-democracy bad economics in the conservative style, particular instances of real markets are presented as normatively or ethically significant because of underlying normative or ethical views relating to the definition, distribution, use of economic power. Those normative, ethical views typically involve support for certain legal property “rights,” certain mechanisms for distributing economic power (often labor and capital markets, inheritance, etc.), use of markets to resolve interpersonal conflict, allocate scarce resources. So anti-democracy bad economics in the conservative style deals with the ethical half-theory structure of neoclassical welfare economics by transforming it into a full ethical theory by surreptitiously supplying exogenous normative or ethical inputs to address equity.

However, bad economics in the conservative style is not the only way to play games with the distinctive, unusual ethical half-theory structure of neoclassical welfare economics. Another way is to imply only the normative or ethical content in that theory has standing. That approach likely comes from the old logical positivist philosophy linked to neoclassical welfare economics under the conceit it’s science rather than a normative or ethical theory. It leads to distinctive confusion about the positive normative distinction. The typical expression is what I call “positive normative” economics, in which the positivist notion ethics is “nonsense” (because not science) is combined with the notion neoclassical welfare economics is just a positive logical analysis of some such nonsense. Under this view, economists are justified working through the logical implications of whatever ethical nonsense was there when they got there, but not in evaluating it or worrying about the role of additional ethical nonsense that wasn’t there. They’re far above that. In that view, economists qua economists are perfectly justified presenting neoclassical welfare economics as a full ethical theory on behalf of those who might hold such views, be interested in that sort of nonsense, while not worrying about the role of “equity” concerns. That rhetorical maneuver can render the conclusions of neoclassical welfare economics absurdly controversial when applied in realistic contexts, as most people will have ethical views about how to resolve interpersonal conflicts of preferences, allocate resources fairly, etc. However, under the positivist conceit, economists are not meant to discuss, evaluate, defend that normative or ethical content, help anyone determine if it’s plausible or implausible, controversial or uncontroversial, etc. That would be a job for ethical philosophers.

In contrast, the opening post suggests yet a third way to deal with the ethical half-theory structure of neoclassical welfare economics: present thinking about equity, the ethics of resolving interpersonal conflicts of preferences, allocation of resources, etc., as evil. “Evil” is a normative or ethical concept, so the argument here does not involve slipping in equity arguments, or suggesting they’re nonsense, but that correct ethics says one should be an egoist who finds any ethics relating to resolving interpersonal conflict unethical. It’s an extremely controversial ethical position many would presumably find implausible. Again, resolving interpersonal conflicts of preferences makes up the lion’s share of most ethical theory. What one does in the absence of interpersonal conflict is generally not an issue. 

The ethical half-theory structure of neoclassical welfare economics has created much confusion and conflict manifesting in a number of different ways. It’s clear academic economists have failed to adequately explain it, aggressively address it. They should step up their game.

Revolutionary Conservatism

There’s a fine line between those one might most sensibly call revolutionary conservatives and status quo conservatives, based on their assessment of our existing laws relating to the definition, distribution, use of economic power. Let’s discuss that this week.

Conservative ethics relating to economic power are all about certain property designations, certain means of distributing economic power (inheritance, returns on labor and capital markets, etc.) and expanding the extent of the market, the use of economic power. For conservatives, evaluating the ethics of status quo economic arrangements can be tricky. Does law respect ostensibly correct property “rights?” Has democratic government “interfered with” or “distorted” labor, capital markets? Blocked, provided alternatives, to markets?

For some conservatives, current laws governing the definition, distribution, use of economic power comport with conservative ethics well enough. It’s any potential change from the status quo they’re concerned about. Those are traditional pro status quo conservatives. A tricky bit is that although democratic government is arguably part of the status quo it may also serve as a means to change the status quo, so even pro status quo conservatives typically want to limit or shrink any future, potentially status quo altering role for democracy. The historical prevalence in the USA at least of this sort of conservative has led to an interesting linguistic convention in which “conservative” is often equated with support for the status quo, rather than for certain distinctive “conservative” views on economic power. It’s led to a whole cottage industry relating to defining a true “conservative.” However, it seems abundantly clear the word as currently used does not simply equate to support for the status quo, and many self-identified “conservatives” in fact do not.

For other conservatives, democratic government has already tainted the economic status quo, which they find now ethically incorrect. Among these anti status quo (in terms of economics) conservatives are pro democracy and anti democracy contingents. A tricky bit here is whether anti status quo but pro democracy conservatives are truly pro democracy in the sense of accepting the ethos of democracy with respect to addressing the ethics of economic power, or simply prefer it in some contexts as a potentially useful expedient. To the extent anti (economic) status quo but ostensibly pro democracy conservatives see democracy as simply an expedient, one may expect their support for democracy to be unreliable if they suspect some other expedient may prove more practical, successful. Anti (economic) status quo and anti democracy conservatives are what one might call revolutionary conservatives, fascists, who want both to institute ostensibly proper conservative ethics relating to economic power and eliminate the democracy they feel may interfere with it.

Interestingly, pro and anti status quo conservatives can happily work together disseminating their shared ethical views on economic power, and their concerns about, or outright opposition to, democratic government, but there are inherent limits to their cooperation. That’s because at some point any non-democratic, fascist government would have to decide if status quo patterns and use of economic power are consistent with conservative ethics on economic power or not, decide to maintain or change the status quo, by a little or a lot, etc. One might suppose in any sort of violent, authoritarian fascist showdown in favor of the economic status quo or against it, those supporting the economic status quo must surely have the upper hand due to their superior economic power, control of resources, etc. But it’s not a done deal by any means. Once fascists gain control of the legal system, the police, the courts, the military, one supposes they may be in a position to prevail over even the economically powerful, if ever they had a mind to do so. The point is they cannot both ultimately have their way, one side will eventually be shown to have been useful tools for the rise of the other, similar to the anti democracy tools helping the fascist cause of ending democracy thinking they’re creating anarchism or communism.

How can these alliances work so effectively in trying to end democracy in the USA without more general agreement on goals, objectives? Do they each simply expect to emerge victorious? Have they just never thought about it? Do they purposefully avoid discussing it? Do they truly prefer rule by other factions and their potential ossification into violent anarchy or authoritarian, repressive government to the ability to argue their case under democratic government? Do anti status quo conservatives prefer pro status quo fascism to democracy? Would either of the conservative factions prefer anarchism, or let’s say communism, to arguing their conservative views in a democracy? And similarly for those factions with respect to conservatism? Seem odd they would, but the world is full of oddities.

What’s my point? Maybe just try to understand the similarities and differences between pro and anti status quo conservatives, get over the notion terms like revolutionary conservatism or revolutionary fascism are oxymorons. More generally, when discussing the various anti democracy creeds and ideologies of the right or left, don’t just end the discussion with the perceived failings or deficiencies of democracy. Inquire about the intended alternatives, the goals or objectives being proposed.