TRAGEDY THEN FARCE

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Tragedy Then Farce is focused on constructively battling the illnesses our age through creativity, curiosity, and communication. If you want any higher quality copies of my photographs to download, just let me know and I'd be happy to oblige. Welcome.

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Wednesday, April 13, 2011

Contra Carson: In Defense of The Inequality of Wealth and Income

This piece was written by my close friend, fellow philosopher, and co-worker Jacob Roundtree. His blog can be found at ww.jacobroundtree.com. I implore you to check him out. 

The notion that an unhampered market economy would feature a significantly lower degree of economic inequality than that found in our statist economic order has no foundation in the teachings of economics. The Carsonian doctrine that the market process tends towards the equalization of incomes is an arbitrary opinion founded on the whimsical preferences of its adherents. It is highly possible and I think quite probable that a more unequal distribution of income would prevail in an unhampered market economy than would in our present economic order.

The libertarian must not concern herself with the level of economic inequality, per se.
As libertarians we are fundamentally committed to erecting the social order that preserves the liberty of all persons and as such provides all with the environment in which they can fulfill their humanity. In other words we are ultimately concerned with the dignity and well-being of all peaceful people. Economics teaches us in no uncertain terms that an unhampered market necessarily tends towards the greatest satisfaction of the desires of all participants.
When discussing the issue of income distribution what worries us is a maldistribution, which is not necessarily an unequal distribution. If, for example, the state intervenes into society, so as to equalize incomes, we would have a wholly unjust distribution of income. So for the Carsonians to at all focus on the question of income inequality is for them to completely misunderstand interventionism’s devastating and corrupting effects on the market order.
Interventionism is a hazard because it disintegrates the social bond by undermining the market’s institutional framework. The inequality of income that emerges from the interventionist process is a by-product and not of central concern.
Not only do the Carsonians mistakenly see economic inequality as a problem, but they fail to recognize the essential role it plays in the market process.
As Mises argues, the market distributes income according to the contribution each individual makes to the satisfaction of consumer wants. Consequently the market aids individuals in the discovery of their comparative advantage and incentivizes them to contribute the maximum effort to the social system of production. Without such an unequal distribution, either political authorities would have to compel individuals by force to contribute their share or the system of social cooperation would completely disintegrate.
As Mises contends, “only because inequality of wealth is possible in our social order, only because it stimulates everyone to produce as much as he can and at the lowest cost, does mankind today have at its disposal the total annual wealth now available for consumption.” (Liberalism 2005, p.12)
Mises goes on to show that economic inequality performs another indispensable social function in the form of luxury consumption. Mises begins by identifying luxury as a relative concept insofar as it “consists in a way of living that stands in sharp contrast to that of the great mass of one’s contemporaries.” (Liberalism 2005, p.13)
As he argues, luxury consumption effectively subsidizes the production, innovative development and introduction of new consumer goods to the market. Consequently, luxury consumption affords entrepreneurs the means to discover production methods by which they can mass produce innovative products. Mises presents several examples of formerly luxurious items that are now mass consumer goods, including the fork, the automobile and the bathroom.
So the next time one of the newly fashionable left-libertarians wants to think he’s standing with the masses by decrying the luxurious lifestyle of the rich, he should consider the following words of wisdom from Mises:
“Luxury consumption provides industry with the stimulus to discover and introduce new things. It is one of the dynamic factors in our economy. To it we owe the progressive innovations by which the standard of living of all strata of the population has been gradually raised” (Liberalism, p.13)
Jacobroundtree.com (The Social Rationalist) CHECK IT OUT


44 comments:

  1. Well written...but I'll leave it at that.

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  2. Hm, I never thought Libertarians would be FOR luxury. Very interesting.

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  3. Interesting stuff, I may not agree but then it's good to read other points of view

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  4. Really really well written. Very inspiring and interesting.

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  5. Interesting theories, but that artwork at the end is terrifying

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  6. Luxury is so overrated, why not live below our means? We can't have everything. Interesting picture there.

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  7. very interesting read, thanks! ^^ I dont agree, I don't think luxury is over-rated at all !! If we want to live that way, we should if not, we wont pretty darn simple.

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  8. Cool pic man But i dont know if i agree, i would live off the land and do it gladly but since i dont live on a farm or anithyng like it im screwed so i need my comforts

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  9. i love the picture, do you know the artist?

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  10. Ugh elaborate political theories don't matter in practice though, especially in a country fairly split on what to do.

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  11. wow... heavy stuff... will read it later, ok? ;)

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  12. The pursuit of luxury at any cost was one of the causes for this economic downfall...

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  13. I like the dark image posted with it. Gets you thinking what was in the mind of the artist behind it.

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  14. Definitely a thinker piece. That drawing is pretty cool too. Following.

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  15. i like the fishes in the sidebar

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  16. That's some scary pic.. where did it come from?

    /awesome read, btw!

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  17. I agree with you, and I'm following you :)

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  18. Libertarian here! Loved your article

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  19. good read indeed. finding good policies to help the market is never easy. economics leads to some of the most interesting debates.

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  20. Completely agree that free markets are the way to go.However markets are rarely,if ever, truly free and the system is clearly rigged which makes it impossible for a lot of people to improve their life conditions.Capitalism might not be best system there is, but it is the best one we have so far.

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  21. ooooooooooooooooooooo That pic.....

    drtranopenmouth.jpg

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  22. Wow, I'm sending this around.

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  23. Got distracted by the picture... O.o

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  24. i think this will be alright always

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  25. Your friend is a very good writer! What's up with the picture though?

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  26. I think that's an interesting perspective, that consumers are promoting advancement in ideas and technology, is better than saying consumers simply waste manufacturing resources.

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  27. very interesting lets stay in contact for further information :)

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  28. I am wondering how you fit the image with any of this.

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  29. My communist friend (he thinks of himself as a communist (and so do I...)) is trying to convince me that a socialized economy would be beneficial in every way. I fail to see how it could, your text will serve as some more well constructed arguments against him next time I see him :) Great read.

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  30. it seems to me just impossible to move past our capitalist ways. with an aggressive mindset we have somewhere deep in us.

    utubed.blogpost.com

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  31. Im with you all the way on this. Great post by the way.

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  32. interesting...... not related but the last image is quite creepy :X

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  33. That's really deep dude, i love all your posts.

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  34. Everything you write it so interesting. Also, i do love that artist.

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  35. That artwork at the end is amazing, and I want it on my wall. That being said, most of the actual post went over my head XD

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  36. Nice Page! Very well developed, a heavy topic to conquer in a blog post, but more power to ya! Give our blog a look. I'll watch and click, please be sure to do the same on ours!

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